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"ov^m ESTABLISHED 1S39 Re*. U. S. Pit. Office Volume 188 Number 5798 EDITORIAL v:-; New York from comes a leading motor industrialist comments on the extent to emotion—psychology—has intensified the boomand-bust cycle, and our growing inability to handle viru¬ lent inflation. For the former, Mr. Ford recommends selfdiscipline and points out, for example, that now is a better time for capital expenditures than during a boom, and regarding the latter he recommends a thorough edu¬ cation job to help achieve a general understanding of the problem and the need to stop the squeeze on necessary profits. Despite our improved ability to use skillfully fiscal and credit policies, Mr. Ford notes we have not dis¬ played the capacity to deal with prosperity as well as we have dealt with adversity. letter to Cabinet members and other insisting that they; hold their outlays within the limits entered in the budget tabula¬ tions to appear after the first of the year. These steps are described as conforming to the post¬ election statement of the President that he would all the power in his hands to eliminate need¬ iest spending by the Federal Government. The ultimate goal is, of course, a balanced budget, but no one at this moment appears ready to speculate about how long it will be before the approximately $13 billion deficit will disappear. All this, of is good news course, elements which seemed to far so a time like this blast-ofl. It seems as ? discouraging aspects of our tax ' laws as they affect foreign investment, Congressman Boggs announces that Subcommittee hearings will be '' held on Dec. 1, on this subject and, speaking for him¬ self, outlines reasons why we need a searching review ■ of our revenue laws as they apply to foreign source in¬ come. He supports such incentives to encourage foreign private investment ing foreign principal of territoriality in tax¬ income; elimination of certain dis¬ as: source criminatory and unequitable results which are said to distort business decisions and prevent our American . hear rumbles to the we a new and the formation of base companies for the conduct of foreign burfness operations in the United States itself. economic place." Now it's off with the •' I think we can accept the fact that it is the policy of the United States to promote the economic growth at the free nations of the world and to do and on with the rose colored goggles. I would like to suggest that before we go off on another binge, we ought to take a very thoughtful all that is prudently possible to help the less developed nations to achieve look at the recent past. The postwar period has been marked sible by repeated would crepe be in control of the legislation this past year will be able to exert the same degree of influence upon the newly elected members of the House and Senate. The President's attitude and position appeared this year to be, comparatively speaking, on the side of some measure of reason in adding to out¬ lays land opposing tax reduction, but he could hardily be described as a very vigorous or forceful advocate of conservatism in the handling of poli¬ cies having to do with the fiscal health of the country. Business appears to be improving (juite generally, and that sooner or later wilf mean larger revenues for the Treasury. It is safe enough to guess that a balanced budget, or some- in and have economic our been in excesses prey that momentum of progress in agri¬ culture and industry to make it pos¬ our economy thinking. We the to extremes of op¬ despair. We have been buying jags and building jags, spending jags and borrowing jags. We have made great advances in raising the general living* standard of Many of in business have allowed ourselves a little us Continued on page 34 by Mr. Ford before the Southern Newspaper Publishers Association, Boca Raton, Fla., Nov. IS, 1958. ♦A to look forward to economic growth. It equally clear that it is of our country to con¬ policy and to assist in friends our the world to the largest extent pos¬ sible by encouraging the unhampered operation of our dynamic free enter-; prise system. All agree that this can best be accomplished by providing incentives for private American capital to go American families, but we have also developed some wasteful economic habits and some dangerous economic postures. : them seem tribute on Benson Ford for substantial timism and Continued on page 26 j J Foreign Trade Policy Concerned about the scarcely weeks ago that, to quote a great mixed metaphor, "the crepehangers Vffcre crying 'wolf' in the market national ; on system from being carried abroad by our business men; Inevitably in effect that the countdown has started for it goes. There is danger that the President will have a spenders' Congress to dear with after the first of the year. Time only will tell whether the saner { Chairman, House Subcommittee which officials use By HON. HALE BOGGS* A , Copy Oi Investment Abroad Vice-President, Ford Motor Company,' Dearborn, Mich.~ Washington that the budget a The Tax Implications By BENSON FORD* making .authorities are making substantial redu£tions in departmental estimates of expenditures for the coming fiscal year, and that the President has sent Price 50 Cents Dealing With Prosperity As We See It Word 7, N. Y., Thursday, November 27, 1958 Rep. Hale Boggs abroad and take with it the vitality, skill, and the imagination that has made our system the strongest economic system in the world. Private in- the Continued address ♦An talk by on page 32 Congressman Boggs before the 45tb Annual Convention, New York City, Nov. 19, 1958. National Foreign Trade — Underwriters, dealers and investors in corpo¬ complete picture of issues now registered with the SEC and potential undertakings in our "Securities in Registration" Section, starting on page 40. SECURITIES NOW IN REGISTRATION rate DEALERS ' \ securities afforded are a State, Municipal bi¬ ■' and ll. S. Government, „ UNDERWRITERS, Municipal State and Securities telephone: STATE and and MUNICIPAL 623 So. Hope of BONDS THE FIRST NATIONAL CITY RANK Burnham and MEMBERS NEW ST..N.Y. CABLE! Underwriter w • Company San Diegb, Santa Ana, OF NEW YORK Inquiries Invited California NEW YORK 5, N. Y. • W 4-1400 TELETYPE NY MMS Teletype: NY 1-708 Bond Dept. New York Net To 1832 ESTABLISHED Members Maintained Markets Active Banks Dealers, . T.L.Watson &Co. and Brokers placer dev. ltd. Block ' ' DALLAS V - Chase Manhattan BANK (Rights Expiring January 15, 1959) "'We offer to buy - y ' * NEW YORK 4, N. DEPARTMENT DIRECT VIRES TO MONTREAL AND TORONTO Goodbody & Co. Y. MEMBERS NEW YORK STOCK BRIDGEPORT • PERTH AMBOY 15 BR0A0WAY - NEW YORK * EXCHANGE. 1 NORTH LA SALLE ST . CHICAGO current these rights at the market. 1 , For Toronto, Montreal, Victoria and Halifax S. Teletype NY 1-2270 f STREET ' Ottawa, Winnipeg, Calgary, Vancouver, ( Stock Exchange } 25 BROAD 'I:'.. Southern Correspondent—Pershing Sc Co. Direct private wires to Inquiries Invited CANADIAN American gwUhu>€4t COMPANY on Securities The Toronto-Dominion Bank New York Stock Exchange FIRST Santa Monica COIVmHAM Distributor Dealer ( THE Pasadena, Pomona, Redlands, Riverside, STOCK EXCHANGES YORK AND AMERICAN 15 BROAD STREET, j BOND DEPARTMENT Offices in Claremont, Corona del Mar, Encino, Glendale, Hollywood, Long Beach, BANK 30 BROAD '_ Members Pacific Coast Exchange SECURITIES DEPARTMENT ; ■ Associate Member American Stock Exchange CORN EXCHANGE BOND Bonds and Notes Members New York Stock Exchange INVESTMENT CHEMICAL Street, Los Angeles 17, California DISTRIBUTORS HAnover 2-3700 Public Housing Agency Lester, Ryons & Co. . * Municipals * Dojumox Securities Grporaxioti Associate M Member ol . . , DEPARTMENT „ Bttttlt of America American Stock Bxch. Tele. NY 1-702-3 . MUNICIPAL BOND NATIONALASSOCIATION Exchange Place, New- York 5, N. Y. TeL WHltehall 4-8181 California \ j 300 Montgomery St., San Francisco, Calif. - 2 The Commercial and Financial Chronicle. (2194) For Banks, The Brokers, Dealers only If it's Over-the-Counter Security I Like Best Try "HANSEATIC" participate aid give their different group of experts field from all sections of the country for favoring reasons be sure o] are Speed they to be regarded, the end of 1948. Per share The writer believes the manage- & Telegraph most delighted was to Teletype NY 1-40 SAN FRANCISCO • Many believe that it is unreal¬ to expect a wide and sub¬ istic stantial upward move in a "utility" the o YORK 5 nine other panies 2-7815 representative over A brief period 11-year an with com- * interesting facts. A.T.&T. has the longest dividend many record and its vield is equal to wie recora, ana its yield is eaual to the Trading Interest In made relation to A. T. T. & facts LYNCHBURG, VA. TWX LY 77 City to which the If $180 t + / T for- This d by I. with M. with growth 218%. NORTH DuPont, 82%; Standard Oil of N J or The Investment Bankers Br»adway,N.Y. 6 COrHandt T-56M inc. 37 Wall Street, New Ynrk 5, N. Y. Undermitars—Distributor* "tMp Dealers y ••p.pf P ;• Inrestment Securities ; , Anticipated , business from ' Canadian and Domestic Gf Opportunities Delimited :m japan the" airline industry, with advent jet transportation/ - ' " : , Write throughout veseareh anri ^ aides da^a processing, communications, increase from 50 WUh a'coun^I fT fh gh radar, missrie iguidance, etc. gomg 100% to c&mmerci^l a toM 0fit ~ jtemaraSnBriliBjCo^IlL over SI Broadway, New York 6, N. Y. business m7ch for our Monthly Sted( Digest, and our other reports K that give you a pretty clear picture of the Japanese 1 economy as a whole. . industrial , Based on these factors, alone, -'.. sales m the next two years could rievelnnment The Research and development, Telephone; BOwling Green MllST » This margins Is not an offer or Orders for any solicitation far 1 particular securitlw p * j at.f*}l Laboratories is go-.greatSffl' that it is impossible to cover ,P^poruonaieiy^ more inan lhl? article. The fact that Bell'.,Bai®s\ ' ,* " per- follows: Gulf Oil, 131%; 152%* General Electric as ■1 Laboratories developed the tranOver the past two years (1956120%' sist°r, possibly the greatest elec« 1957> income^j>er_ share oi ' Union' Tronic development of -recent common stock has averaged $0.95. this decades, speaks for itself. "Fortune Net profit in 1958 will fequal $0.90 increase in profits for A T &T Magazine" points out that: Bell *° $1.00 a share: By the end of had been carried directly down to Laboratories has had more papers-.^0 earnings may reach an .an-. : per share earnings without dilupublished ; in the "'Physical Re/ nual rate-equivalent to between ? tion, the picture would be quite view," the leading journal , of $2,00 and $2^0 per share. ... ; different. As it was, A. T. & T. had theoretical and experimental The company has -a simple cap- ' to continuously issue bonds t© Physics^ than any other industrial'italization consisting of 312,000 finance its expansion program, corporation. It had 50%. more shares of common stock. Long-;and these were convertible into Papers published than its nearest term debt outstanding is modest. more shares of A. T. & T.'s comc?mpetitor, Westinghouse, and Current financial position is mon stock. Because of this, the ®bout double the next commercial sound. Sears Roebuck Carbide, 31%. A CO RICHMOND, VIRGINIA LAMBORN & CO., Inc. STREET 17%- Of if number of shares outstanding at the of 1957 as end was 64.6 million compared with 23.3 million at Div. ■Name of Company: American SUGAR — Liquid 1 ?lectric Wuld not be too much to Continued ' on Dividend $2.23 $1.48 $13 28 1.80 1.60 3.44 18 1.46 1.00! 2.96 15 8.95 0.89 Internal'! Tel. IS <083 tWene, Power 1949 7 8.90 None 1.23 OOC Pennsylvania Pwr. & Lt. 1946 South Carolina "Electric 1946 20 2.95 1.20 3.22 2.40 8 0.74 States & Tjel. 1951 American "Tel. & TeJ, . 8 872 $1.39 $0.42: 0.50 981.. 0.63 .^50 1 -9.00. f Adjusted.^fpr rstock >dividends and jspllts; ,3' It At the company's new plant in presume fcardena which was completed ip page 33 J957 with €arns. •Price Advance 3.0°o 22.5% 2.4C 4.2 16.5 s57 2.00 2.0 310 89 380 303 1.85 3.3 18.7 56 286 ' 3.12 1.80 3.4 17.4 53 4.1 18.9 ;22 4.6 16.2 52 , ; - i'*' r Z SAm& Over-the-Counter floor area of approxi- 160,000 square feet, the engineers and manufac4 variety of specialized elec¬ tronic equipment used in testing, company Price X Yield a <0 mately Approx. (Current) 1957 Earns. Power 1910 W*ir>ia Electric.**,.^ 8825 Mfbj 4-2727 —1947 (Approximate)— Adjusted EarnDivi-l Price* * Ings 8end Consolidated Edison... 1885 Florida fower Corp 1937 General Telephone.,.. 1836 Northern Exports—Imports—Futures Elec.. Since % d and course NEW YORK 5, N. Y. Refined Brokers & f 11 (4) -Continued satisfactory vol- technical and scholastic circles. Other companies formed 'thegrest renowned 224%; followed VIRGINIA — . i craft industry which has been the are sunoorting staff'. PrinciPal source of business to of Self^^rsonril is date' " ^~ ^ engineers ^e4aliblr the was S. B. ■ Yamaichi Sacuritias Co., Ltd. j, tists g £e U. Raw (3) other A. T. & T. projects. •f CAROUN . . two-non-military Western Electric/ or work,- MUNICIPAL BONDS SOUTH CAROUN . company's specialized; testing and check-out. equipment for .the missile program. ..''iT.. • j about are greatest percentage increase of the 25 companies studied. Next was strong York, Inc. Affiliatel of i the that T in Steel of New ; newly-developed refrigeration Industrial t e s .on research, thirds is employed in must one conclusion last 10-year period. WALL r e a money market. T"; ' A study made by Capital Gains Research Bureau of the 25 largest i WEST VIRGINIA ihe grossly undervalued in the present ^^ write ecuifties Company The eurrent year'8 -expected to be marketed next,. budget for Bell totals.!,•"'■ 5 f V.r* .:7?*' %:"♦ million. About half oi tfeis G (2) fIncr easing demand-' for the is ^T^n^nrofits^in^o^Iars adv^r^er! for the has directed- or Yamaichi 1946, Mr. R. B. Sprague Laboratory/' the all shares -of A, T. & T. common i g in-in r o Call research discrepancy. in thinks not. examined, are come iff G in advances spent wide - information current ; year. decidedly STRMER and COMPANY, Inc. York by $2.82 per evaluation warranted? This writer Life Insurance Co. of Va. Commonwealth Natural Gas this Is For From-:;its .» * is suppplied by the government, the other half comes from A. T. & T.df this $180 million , New fantastic selling at the lowest priee-timesearnings ratio. Bassett Furniture Industries STOCKS Hy¬ Electronics.' -' Telephone's net: have averaged $11.82 share. This has exceeded the' „WorM,s highest. All the companies listed have American Furniture years years. to about expansion needs. For its of of draulic sand _ $tudy of the table will highlight to five last field breach offices JAPANESE ment in the young, fast-growing for our of this factor does exist, the degree Looking forward, it appears alIs considerably less. Heading the together possible that - sales and research program is Bell Labora- earnings may achieve comparable tories. Bell is owned 50% by gains, if not greater than those of American Tel. & Tel. and 50% fey the? last two years. C.' 'J Western Electric, a 99^82% ;»ub- . This estimate is encouraged by 5 r-£ 5*. TI ni* the' following" factarsr.V?; described in "Fortune IMagazine^'^ Commercial potential of the current two month series as the *-ommercKii potential 01 me ^ &"Telegrrph ican Telephone Exchange performances past is given below. Wire the success Sprague Engineering Corp. is an¬ other epic of personal achieve- . panies, the record is usually sur¬ prising. A table comparing Amer^ New York Stock Exchange Private in Direct wires to f } , of other utilities and phone com¬ —5-2527— needs established The dilu¬ NY 1-1557 ■ MmONNELl&flX LD 39 its of Exchange Members American Stock Exchange Birmingham, Ala Mobile, Ala. growth of this The 'Vimporta n t next five years should allow this Jlm'a n tifacturer dividend coverage to triple and -'of precision permit a commensurate > upward % equipment' to adjustment in the dividend. Besides * comparing f. its 'current favorably position with competitive investments on awhere annual financial and statistical -basis, r>*iDert G, Gftersen A. T. & T. possesses a substantial sales,,volume approaches $9 plus factor in its unbelievably vast research program. This plus = million. This is more - thanv'50%; factor is not present in most of higher than sales two years ago.4 the companies with - which Net, profits have shown a similar A. T. & T. is compared. Where Sain in this period. type security. This attitude is open to -serious question. When one , did dividend Since 1917 REctor much as it per Allen that examines f New Orleans, La.- Sprague Engineering Corporation earnings S. Members New York Stock ; Analyst, Stern, Frank, Meyer & Fox, Los Angeles, Calif, ^rv the past 10 years, the two not too distant future. Members Senior common & Telegraph— Merton , Steiner, Rouse & Co HAnover 2-0700 neces¬ the of cause the 75% Telephone will provide a somewhat surprising perform¬ ance in the market place over the SCRIP Meyer & Fox, (Page 2) This figure will amount feel Stock Thus, the as However, I do 120 BROADWAY, NEW the was of twice I performances, Specialists in Frank, ALBERT J. GHERSEN shares, diminishes rather sharply. Tele¬ phone should generate ^ almost remote. < - 19 Rector St., New York I, N.Y, $1,160 expansion in the next five seems & about American last RIGHTS be Like Best"— repeating Principal Cities to Stern, this Telephone CHICAGO • tion the "Security 120 Broadway, New York 5 TEL. Bought—Sold——Quoted Los Angeles, Calif. take sity for raising capital externally, which of to million for 1958. present American Stock Exchange 4-2300 estimated likeli¬ hood will rectify T. to 1948, Telephone's total re¬ earnings and depreciation totaled about $297 million. It is was The & In The so. T. steps tained Getty Oil. Member Associate do first Established 1920 American New situation. row a A. of remedial when my last ''Security I Like Best" con¬ tribution on Miles Laboratories, doubled within a year. This was Corporation . Harris, Upham & Co., York City.' (Page .2) ment I New York Hanseatic Wires * earn- ings increased by only 32%, while Sprague E.gl«ecru.g Corp bert J. Ghersen, Senior Analyst;'* net income increased by 274%. ■ .? T issue in Private Louisiana Securities Tele¬ & Al-1 the second PHILADELPHIA Telephone graph Co.—Merton S. Allen, of American Telephone than 400 OTC Issues BOSTON nor Harris, Upham 4 Co., New York City Stork Exchange Primary Markets in more - be, to Members New York Experience WOrth Alabama & Their Selections particular security. a intended are not offer to sell the securities discussed.) as an S. ALLEN MERTON Nationwide Wire System r, ' American (The articles contained in this foram " - Forum Participants end A coitmnons forum in which, each week, a ... b the investment and advisory Because you can "f- This Week's Thursday, November 27, 1958 . $49 290% 110 i -215 \ . 1.S8 108 3.2 3^ 0.98 2.9 210 21.5 33 1.53 33 325 '• 02.84 9.00 4.6 15.0 194 x16 ' fures a servicing and" maintaining of air4 icraft,' both conventional and jet| jand missiles. • - • .. Test equipment, which are : made in standard designs and cus- torn units for individual Continued on : f specificaf pjage-334 Jtkniifcif UHmAStnet ' JlMrVvkMLL i Number 5798 188 Volume . . . The Commercial and Financial Chronicle I N D E X Some Lessons of the B. SL Articles and News v / Page ^ 1 Dealing Willi Prosperity—Benson Ford By DR. ARTOUR F. BURNS* ; Some Lessons of the Recent Recession—Arthur F. Bums 3 From City President, National Bureau of Economic Research, New York City Former Chairman, Council of Economic Advisors 4 Itinerant Notebook—A. Wilfred May an From Stitches need to 7 strengthen anti-recession policies as the better way to contain price inflation. Cognizant that improved business-cycles polit des alone are not enough, Dr. Burns suggests, nevertheless, several reforms including: 1 (1) use of lax cuts instead of public spending during a recession; (2) liberalized, permanent improvement of unemployment insurance; and (3) inclusion >: of price level stability goal in the Employment Act; The econ- : VV'j omist lauds the consumers as beroes during the recession and notes such striking features during tbe downturn as: the economy's resilience, ability of personal income and consumer spending to diverge from production, wage and price inflexi¬ bility, and growth of non-price competition. - s f' > - • the • 1 discusses economist Riches—Ira U. to —: Cobleigh___ LET'S TALK TURKEY never stands still. Long-Range Outlook for Steel—Charles M. White ! _ Growth of Employee Benefits and the Trend of Inflation —W. problems as economic new to come teach Every our way. event has lessons us, W. : of know _— . _1—.1 T i • _____ 1 ^ Policy—Hon. Robert of the future. Cover —G. Arnold Hart___ ci t in g doubts or new sion warrants that special notice decline rather sharp,, shortest review in production was the F. Burns Dr. Arthur ,, recession and recovery. The recession had many features typical business slump ;of It: began with a decline of investment commitments was of the very one on the tion business over the the most fell rapidly in the industries; it fell least rapidly or not at all in the (durable goods service trades. •orders of and , Cancellation of appropriations for •capital expenditures became more frequent. Overtime work dwindled, the number of unem¬ ployed mounted, corporate profits shrank, and business failures multiplied.'The aggregate output of factories our in 13% declined of the recession, the output of mines declined 17%, construction work fell 6%, and course railroad Other traffic fell 20%. over branches of production re¬ mained reasonably stable. Never¬ the- nation's overall physical output diminished about 6%, corporate profits fell more than' 30%, and. unemployment reached the highest level of the postwar period. From the facts at hand, it would seem that the Tecent decline of production was theless, ♦An address by Dr. Rums average before the Anniversary Meeting of tbe Joint Council on Economic Education, Wash¬ 10th ington, D. C., Nov. 19, August 1957, reached a trough this April, and since then has beenr rising again. " •''-'*••• '. a , Nearly every major industry is participating in the advance. Production, sales employment, and profits are improving generally. The mining industries have al¬ The Scafuro —_______ residential both and sluggishness trade ance the stock ever, taking the current . 18 _. appears to ,t Investment _____ Cover _—___;—__ Field__--___---__-7_ll-- ,8 Notes NSTA 38 Activity— ___7—^— — Our Reporter on Our Reporter's , page - -— — Glens Falls Schenectady. Worcester San Francisco 29 Philadelphia - Securities Now in Registration— „ "a i ( I ; Los Angeles Dallas Cleveland . Chicago Permachem Corp. « 49 ■ : — Westwater Corp. 45 Altamil Corp. 34 ; . 1 18 Alsco, Inc. 2 = Electronic , 30 ■ Washington and : ihe - -•—•—■——- •—•——--—■—- s— ———;— Twice Weekly ' ' Company Reg. TJ. S. B. DANA ig42 ^ thfe post offlce at York, N. Y„ under the Act of March 8, . COMPANY, Publishers - maHnmr p. sEIBERT, editor & Dominion ' niMt WB1IIM DANA mnnw *- ? fsrmcKT wINKT, President Presiden* Thursday, "November 27,1958 . ^ records state clearings,. and Offices' Chicago 3, HI. ^n Canada, $68.00. per year. $72.00 per year. r Publications » corporation news, bank city news etc.). of other Countries, - -Every Thursday. (general . s«n« <«t_ (Telephone €Tate 2-0613). . .• *■■)'<■ 7 Subscription Rates Subscriptions in Territories possessions, . - Pacific Uranium 1879. V. S. and Members "of Publisher* * Pan-American •Union, $65.00 per year, in - > , ' REotor ^-9570 to 9576 Specialty «. . ary Patent Office ._!< J Reentered as sfccond-class matter PebruNew PUPANICLE FINAKUIAL-VMIfUniOLSi - " Copyright 1958 "by WHliam B. Dana 1 . 48 - — . !" COMMCRCiAl and riiiAyeiAl • You , ; ? Industry The State of Trade and .. / 27 39 — qJmLtioff - ' ^ — Securities Railroad CTHPUt TELETYPE NY 15 : Chicago -- . Direct Wires to 25 Governments,.--— •• 7 i . 16 —___ Report— Utility Securities—. Public ■ TELEPHONE HAnover 24300 40 Exchange Place, W. Y.: Teletype NY 1-1B25 & 1*4844 39 — News About Banks and Bankers.--^--- ' This brings me to another strikr r Mack xe, inc.; & Bargeron__— 11 Ahead of the News—Carlisle . . Singer, Bean 13 - - • 8 Reooniiriendatk>ns--____—___— Prospective Security Offerings.-^ — the resilience of our The fear of stagnation, Securities Salesman's Corner— which inhibited progress during the 1930s, has left us and our 7 The Market 7. and You—By Wallace Streete————— traditional optimism is again driv¬ The Security I Like Best —-— ing the economy forward York Stock Exdimfe Pacific Uraninm Reeves Soimdcraft 18 — to 25 BROAD ST., NEW FORK 4, N. Y. , ———21 Funds Mutual economy. Spencer Trask & Co. Ampox Corp. W. i. Max son Stocks— Indications of Current Business Thus, the brevity of the reces-; sion, the pace of the recovery, and its widespread character, all on , "City ; Elox Corp. HA 2-9000 have . Continued ; How¬ momentum. testify - - 23 _______ — Bookshelf From Washington all factors together, recovery is widely and based ; I 1 Direct wires to Denver A 21 "British Reflation Continues" Einzig: of market. 4-4970 19 — Coming Events in the Investment Dealer-Broker our export excessive .exuber¬ the and of Insurance Man's Business dential, are rising. Unemployment is still substantial, but the average length of the workweek has al¬ ready increased significantly and employment is also rising. There are, as always, _clouds on the economic horizon — among then! the and Bank WILLIAM DIgby ".. Regular Features nonresi¬ • Stack E»ch.' Exchange Pl^ Jersey City Teletypes JCY 1160 __________ _—— As We Sec It (Editorial) , lHCri.HIII.tl OlBbfll Nashville 1 Perkin- Elmer flowing to manufac¬ again advancing and of late have equaled, if not exceeded, their sales. Construction contracts;' DDCrrDDrn ■ Members Salt Lake City - > — Liquidity—Per Jacobsson_____ International are For many years we Boston J.F.Reiliy&Co.,!nc. 7 ' 17 —Roger W. Babson_„__ orders turers have r - Miller X. Published Albany * ^ f* Independent Voter and the Republican Party The <. New '♦ Program to Combat It —Joseph W. Hibben - . : Members '' * now 1958. specialized in 7 Salt Lake - 7 "7 •: " Attracting Capital for Alaskan Enterprises , „ equal to "die just about 7 Providing ^Guarantees and Credit for American Exporters —Francis aggregate began declining in • the C. —Donald 1 downswings of "the'busi¬ firms and soon greater part of the economic system. Production ready recovered more than half of generally fell as sales diminished. the earlier decline in output, du¬ But production fell more sharply rable manufactures have recovered than sales, since producers deemed two-fifths of the decline, non¬ Jrt advantageous to meet a part of durable manufactures have more the current demand, by drawing than made up the decline, and so down their inventories. Produc¬ also has the construction industry; part of spread ' ♦' Prospects 12 Inflation and 'The Danger of r the the c'7 States and the Problem of Gold—Philip Cortney— 14 '' ness sur- of H1GGINS, INC, 10 Baird B. ' cycle of which history has left a record. Economic activity in. history. Julian The United is its brevity. Although the the recession rounding 22 __L:—ui. —James J. O'Leary therefore recent L'. Angell Current Money Market Developments and reces¬ to , —rJames W. —Hon. ful of SOUNDCRAFT Treasury Faces Debt Management and Sound Dollar Policies inquiry. It may be help¬ events REEVES 29 ' : International liquidity and American Foreign Policy • the of feature first The x some 15 classical • ; BASIC ATOMICS Murphy_i—-_——6 ' sometimes e PERMACHEM CORP. 3 , _ Canada's Role in International Gomweroe and Finance Recession's Characteristics V This resolutions, ' , ; ^ Some Political Implications mii Qur Foreign Economic , the problems ! V 7 contemplate we as STREET, NEW YQRK 7 <• . most to. teach us model that have arid strengthening our opinions or Obsolete Securities Dept. Convention Gnideposts to World Trade—John J, McCloy. recession- the from 1957-58 - 9 . Tax Implications of Investment Abroad I' / —Hori. Hale Boggs dimensions, and it numerous v - L_____C Tongue 7 Heard at the National Foreign Trade The . . ; 6 .Telephone: WHltehall 4-6551 recession, however, business A .is the divergences of the confirming we V longer. has sometimes what or getting the bird obsoletes, why not 99> WALL the business con¬ preceding century during tractions of the If you're about take cask instead ? paramount decline 1 5 Current "Gold Outflow and Its Significance—M. A. Kriz Economic life That is why opportunities as well MfiXofliy ___Oover Professor of Economics, Columbia University, New York Economists' "3 (2195) Bank other and Quotation »<TnAptif\p iman INCORPORATED 39 BRCACfWAY.RCW WHltehall Reoord—Monthlji. 645.00 p»r year. I-Foreign Postage extra , ..Note—On account of the-fluctuations in the rate 0' exchange, remittances for foreign: subscriptions and advertisements must be made la New York funds. ' m v. frankei & at ' ; A - Y«WC B I 3-3960 Teletype NY 1-4046 St 4041 Direct Wire to PHILADELPHIA j 4 The Commercial and Financial Chronicle (2196) Competitive Cost Pressures - Guideposts to World Trade lu X ' V. - Frequently I find the most avid proponents of the free enterprise' system By JOHN J. McCLOY* pressing for government Manhattan Bank Chairman of the Board of Directors, The Chase ever Of A. WILFRED MAY greater with appropriations The greater restrictions on where the goods may be purchased. We to be on guard lest all we ever Advisor on State Disarmament Policy to the Department of Member, Draper Foreign Aid Committee . internationally known banker warns "we are pricing our¬ selves right out of the world market" and admonishes us to either here or on their the free enterprise No vicissi¬ the what matter tudes, no matter what the in¬ terruptions — and we have had one this year — business, if it related is foreign today to and o f index hu¬ John welfare nt a n J. McCloy well as ourselves... And across we see Britain, and better poised eco¬ nomically than at any other time in the postwar period, pressing with others for an extension of the hope for con¬ as a , principle into trade free both here and abroad wider Mid- a Then moving on to*the area. America, we see ItJs-hoth interesting and signif¬ pending still other forms of re¬ icant- that. even in this year of gional cooperation, initially recession, world trade will amount through Development Banks, to .. t tjian $100., billion, almost more bd later perhaps followed by re¬ volume of some 10 gional common markets. What This is a measure of should be the attitude of Ameri¬ can business toward these devel¬ growth that did not come about automatically. In back of it lay opments? Should we continue to a number of circumstances, not support and encourage them, even the least of which were the imagi¬ though they mean adjustments, the double ago. years nation, planning and effort of men foreign trade industry. But along with this and supporting it has been the wisdom of peoples in the together, chiefly through enlightened policies of govern¬ ment. I hardly need call off the acting list of these policies and programs —the agreements fashioned at Bretton Woods; the Marshall Plan and the OEEC; the European Pay¬ Union; ments cent programs and our more re¬ of mutual security and economic aid are among them. this But process growth, of change and challenge is neverending. I cannot help but feel that not always tion? in easy, And posi¬ our own shall how view we proposals to enlarge the resources of institutions international in reaching major phase progress, ♦From the in of end their postwar and they face many crittalk but rope, a or our own Development Loan Fund? Are we creating too agencies for many our and for the world's? These Is good policy own our questions that defy and I shall not even attempt to advance my own views on them. I would only offer two rather simple guideposts: : simple are answers, Offers Two Guideposts First, the perspective of time, I feel confident that the present will eventually be seen to have been a period in which the over economic interdependence of the Free World greatly increased. The cations, in the art of warfare and in the ability to employ nature's kind STATISTICIAN- in V' *• desires this field. as Would inter¬ have of to free from the narrow re¬ self-interest assay But, secondly, within the frame¬ this Americans interdependence, we dedicated are participation to in a eco¬ nomic life through the medium of free personal thus be the techniques which we and others devise for working more closely together. we maximum statistician-analyst. We even more strictions work of position forward It will become more expert, imaginative and effective old, with extensive experiti us man¬ necessary for us to as years pressing direction. ourselves • College graduate, 34 all are that in ANALYST tremendous enterprise. intervention We should by Please 1120, write Box Commercial riod. I & Park Chronicle, 25 Place, New York 7, economic climate and not to ration raindrops. Thus we should work for governments everywhere to facilitate the assistance which private their New York. do to build industrial enterprise can bring to peoples — through invest¬ ment, technical know-how and the unleashing of creative energy that is bound up with self-interest. Compared to government-to-gov¬ ernment transactions this field is still largely undeveloped. of long been done. maintain Now ish far importantly more I with forces, both political and new nomic. of It incumbent is we are part. a China's, successful wedging into In cement 1953 she China began exporting com- of the total imports product; it has since grown full 50%—with the Japanese a Thus far this year,, 28% ahead of 1957-1958 percentage in¬ in HK dollar shipments of (cut and We notebook enough her fortunate d'etat. during Thailand, $225-million rice crop, prime target for Red been China was to be in Bangkok the Oct. 20 coup a of which, I the Peiping's pressures; one consisted in furnishing of extra-cheap newsprint to newspapers which are sympathetic to her Communist found, even line. a large number of our friends inquiring about the stability of, whole world's trade—and I / * Some fancy need to work is not have. we Otherwise the symbol of the world. All our shall position - .. ■ < goes beyond the func¬ organizers of trade be¬ nations, and yet it is it. Our businesses are a a part key aspect of the face our nation pre¬ sents to other peoples. Americans must accept in this testing period increased re¬ sponsibility for leadership. We are in an increasingly complex and in¬ everywhere new terdependent world and the chal¬ lenges it induces demand more, rather than less, of our energy and character, even if it entails some on Saturday or a later train work to suburbia. from fulfill The board of such Controls Co., at their meeting in Richmond, Va., elected John D. Baker, Jr., senior partner of Reynolds & Co., New York, to the control firm's board. Mr. Baker replaces Thomas F. get been between or China, Ceylon major deals didn't work of Communists' because falling-down the the on quality and time of - deliveries, and their arbihold-up on payments. At the last moment Peiping tried to trary force unwanted goods as their part of the payment. Shades of Mos- $ z took Malaya is getting into "the big trade swing" with both China and the Soviet. more She is now buying goods from China than from Hong Kong, and is the third largest of Malayan rubber, Malaya has spectacularly during recent consumer And Soviet trade with grown months —Moscow's direct pur- chases of rubber from there being greater than at any time in history year. four action pressure because of the of business commitments elsewhere. . balance,' along" with $20 million more in loans for the promotion of light industry. In the face of the mostly in possibility rift, there dences growing speculation— the : of a West of are r, ; the evi- many pulling-together in the ecopomic-political spot.*' about — Moscow-Peiping surely "on area the .5.// y, Kahn Elected Director Of Hertz Foundation The Fannie and John Hertz has announced Kahn/partner H. that in Herman invest- the ment banking firm of Lehman Brothers, has been elected a director of the Foundation, Kahn Mr. also is director a poration, Dayton greater than is again defi¬ nitely in the act; with the USSR a trade mis¬ aiming to establish sion there—as a typical wedge for diplomatic representation and the John D. of founder Hertz, the Yellow Cab Co. and the Hertz U-Driv-It System, to devote the entire family fortune to the training of needy and qualified young men and women in engineering study. Mr. the Founda¬ created Hertz in gratitude the country to which allowed him to accumulate The it. within Foundation of needs ^wered to is students the grant* for make the emsus- Powerecl 10 maKe ^ranT® lor SUSj tenance as well as tuition and school other expenses, with the condition that the recipients place fh kill • t djSr>osal th of the tnem skills at tne msposai oi tne United States Government in the event of national emergency. Exchanges to Close Friday After Xmas The arrival of Russian technicians. has attitude Red Kann and pany Sutherland Paper Company. The Hertz Foundation has granted 27 scholarships for the current year. The foundation was established last year by times Politics a the trade tion z The Philippine toward Robertshaw-Fulton board trade with a communist country member since 1947 whose resigna¬ shows how to insert a wedge to tion was accepted at today's meet¬ get concessions out of the United States. ing. Mr. Staley explained that he Philippine trading with Staley, along came Communist China with a three-year credit extension to settle a $16 million unfavorable cow's shenanigans—of the past(?). last of directors of Rob- ertshaw-Fulton deals have Communist deal a —almost Baker Director barter There Ceylon, having been bought out freedom throughout . the of indeed! bartered as 12-year term for assistance." And a "development facturing Cor- * and China in rubber and rice. One be this as tween of we for ernment then Fruehauf Trailer Corn- to need we unable to maintian tion we Feb- a Rubber Company, to leisure—the question can afford what more whether is What * rubber. The rice goes from Burma and to think harder came in with year ing China, Ceylon, and Burma, for the juggling around of rice and say its whole welfare—is in real jeopardy. We need a greater sense of our own responsibility to these thing's and I firmly believe we in regard to them. this 3-way arrangements involv- such dare situation of Avco Manu- have our currency. Without a sound dollar not only our trade but the juicy which Moscow $1Q0 million grant to the Jakarta Gov- tion has rebellion in¬ the last Engineering Scholarship Founda¬ This with the of ruary polished) 114%. We need to face rate, enterprises this year. this national are diamonds and and own. the on Chinese cement at all. no low disease Dutch and other products are: newsprint 70%, % our price-cutting is By 1956, China's share 1957. Our Balance of Payment Problem of via markets of * which of of erupted * creases to develop a. sense of personal responsibility for the harmonious working of the society May into * crying "help," such imports all - high a year, Wilfred v to eco¬ upon because seizure of that to respond to this challenge: us for " Outstanding is the case Indonesia, a country vulner¬ come, other prised 37.4% a trade. " term. people, our whole nation, are great new testing period, 'a period in which all our institu¬ tions are 'Challenged' by powerful in the they were simultaneously importing the product at higher prices from Japan— surely a dumping operation under any definition of that oft-abused we need J areas. able e n- - When a as busi¬ imported our think it must be said that of of cut-rate cement efforts. own the trade ping well demonstrated place in world trade, with reasonable but limited help from government to be sure, but visitors Interesting is the Moseow-Peipartnering in political ma¬ neuvering in a growing number in front in Hong Kong. our to American Commie cap¬ and new to out (one-way) aid; our shortcomings in this regard allegedly "starving" the opposition, which we desire, to units. . of have we ing trenched Brit¬ the Free World and this has large¬ ly imports and expotential ad van- the in and out of the legislature. All ^is adds up to officialdom's point- inter¬ from ness has strength the national not the all on But tages of Commie trade to needed more Kong for ture deplore this. This an objective which we sought bring about. We set out to re¬ is ports. and " m local Hong development. oppose It has been said that the function the Financial stridesRussia field, Co., branches of the aware quirements organ¬ ized the early postwar pe¬ were in we govern ment of government is to influence the S all in " industrial where it is not clearly necessary. view. are activities insurance and have I have referred to Eu¬ .we ac- Mi-ngan Insurance have to work harder and long¬ There are dis¬ know-how. Insur¬ Co. ance the we better products and problem plays materials for the benefit of appreciate a to have ordinated? States tremendous advance in communi¬ ence of us we in respect to them adequately co¬ United Bank, one by Mr. McCloy before the 45th National Foreign Trade Con¬ vention, New York City, Nov. 17, 1958. a to squarely up to dissipate the influence among us of pressure groups which dis¬ turb our political and economic balance. We are rapidly approach¬ ing, if we have not already reached, a balance of payment which the major part—the World Fund and the peoples of the Free World are now out up that China her are out in the Two Peiping companies, the to make them. er East and to Latin tinued peace. to is items trade way keep prices and costs down, made channel stronger improve¬ in right It we the nations of the Free the than ment? man's life, always another including come an in as far-reaching implications for World, ries all trade more mountain. process, market—a venture that car¬ mon courage. ever sic are we were Highlighting the fanning-out of sugar exports is continually proflaimed by a vociferous minority find six We no longer stand out as the great trading nations banding to¬ single great supplier of goods that; gether in the beginnings of a com¬ increased has be to we are the of this in is every energy, in¬ creased imag¬ World, We peak to assail. ■ Thus in Europe creased ination, stretch There in¬ mands market. lines items Red China's expansion beyond ba- concertingly large numbers of climber who, having reached a people in the world who are work¬ plateau, must inevitably gather ing harder than we, and they are strength as he moves toward the rapidly achieving a comparable next trade, de¬ world many make it clear to all start for¬ like the they as another. on to put goods be sold either We have to face the in ourselves have to make decisions ical that fact system." ward ourselves prise system. pricing merits, the antithesis of own tax or abroad on their own merit —the antithesis of the free enter¬ preserve abroad is here the stability of our currency, and resist government subsidization in place of private initiative. Mr. McCloy declares "we have to be on our guard lest all we do is tax ourselves to put goods abroad that cannot be sold keep costs down, do abroad that cannot following quired by Mr. May during a recent trip through the Far East. - have An Thursday, November 27, 1958 ... countries is barred by rigid policy—implemented by imposition of licensing re- New York Stock Exchange announced the exchange will 26" 14 wM1 be closed remain open, however, jan 2. The ^ " American on and Friday, Wednesday, Dec. 31 " Stock Exchange The America* stock Exchange national has also announced it will be the closed on Friday, Dec. 26. Number 5798 1 188 Volume . (2197) The Commercial and Financial Chronicle . '■./ ;v-. Commodity Price Index Food Some The automotive industry last week increased its output of cars vacuum corporations in essentially sagas of are Atlas Sewing Centers are definitely not like this. They are ac- salesmanship—International Busi- tually efficrently run stores with a n e s s M a manager, and his assistant, a service manager, four in, clerical chines, Na¬ . tional Cash ^ Co.,' production, "Steel" magazine this week reported ~ Register Stanley Home that it now appears that the steelmaking rate of 75% of capacity Products, Inc., for the prior-week is near its 1958 peak. Steelmakers in October Avon Prod- / were anticipating a rate of- about 85% before the close of the year. * ucts Inc. and/ It pointed out that automakers were committed to a lot of steel / ^ , * over issues local halted production. As Fuller '; conse¬ a company " tons in October alone. ' > . Electric kilowatt output rose sharply the past week in the season and total retail trade for the country , with ;; • keeping/ over food In a survey a year ago. : the first quarter Atlas is _ made by^-Dun & Bradstreet, Inc. it disclosed that are more optimistic over sales prospects for of 1959 than at any time in the past three years. 1,548 executives polled, 72% forecast higher sales in Janu¬ ary, February amd March than in the first three months of 1958. Only 4% predicted declines. Retailers were particularly hopeful of beating figures. /" \> /:/ ./1 . , u . generous provision per- w^Tbitthe ^rt th(m and_ on the baiss Q( gha^lnd°^ith tracted a e^.nings cent cash considerable following. ~Lce se!f thl : by bonds rocketing past 215 and ln, substantial a conversion. At amount'' of Oct. 8, $476,400 par amount of debentures had already been- converted bringing the then outstanding total of com- lower at $545,000 due to a managerial decision to provide for much higher reserves on accounts and the debentures receivables.) was are the Over-the-Counter The common 1314 / President, expects annual of above common traded in Market is quoted at around ... Were For «?e. *»**.■ the projections cornorate invested corpoa an oroutlets their year-ago sales net capital of only $17,500 to ; is'best illustrated of can be no doubt that Atlas Sewdng common qualifies growth security. The growth however does not deoend nere» nqwever, aoes 110c aepena conization with fiftv within the next decade, lo 1m- 0n extensive research as in a ganization witn r y plement this optimism, Atlas is chemical or electronic enterorise (coast-to-coast .along Southern U^nintt ,nil+Wc nf ?ne™_lcai_ ?Leie. _r?nic.,a. ^nse; ~nd an original «na an original than Dun & sales tq outlet persoimel). quite 1978 in March These bonds contained in 1954 to $807,000 in 1957. (1958 813,433 shares. Both the enterprise has come from scratch overwhelming belief that sales will be up in the first Bradstreet ; ,■ _ ?rreUrshofrt%^erS$Si™eag°er " quarter reflects a more optimistic viewpoint has uncovered since late 1955. . States, with Of 1959 Cobleifb sewing machines in the United sales running at an of ' This U. Ira Sew, plan are amazing record of company growth. For the fiscal year ending 5/31/54, net sales were $3,318,003. For fiscal 1958 sales had mon shares to 670,224. Full conrocketed to over $13 million;, and version of all bonds, plus the rthey are certain to show another exercise of all warrants and leap in 1959. Net earnings have options' outstanding, would 'infollowed suit, rising from $103,000 crease outstanding common to become the second largest retailer , bates- the Centers Inc., which has now ing executives business Atlas leaders these fa!tmerniCesS salesmen, loans imICa7«Vfi%^ The overall effectiveness of this duced' :A • . slightly It was observed that noticeable gains last year were recorded in the sales of household goods and products which offset light declines in wearing apparel. exceeded that of V ; .been added Co., etc. An¬ other up-and- coming enter¬ prise/ following dynami- •; cally in the: footsteps f of delayed shipments accumulated at steel plants and one estimated that finished steel stocks increased by 700,000 quence, Brush seventeen ana As for steel strikes a they keep each other in stitches. most stories cf America this year. outstanding the of success perceptibly following a strike of white collar workers at Chrysler Corp. and a'walkout at The Budd Co. plant at Gary, Ind., a supplier of underbody components for Rambler, the week before. The increase in the number of cars turned out amounted to 20% and V ; Debentures due cleaners with exciting and profit¬ able results—Atlas Sewing Centers Inc. sewing machines and Bank of 6V2 % Convertible Subordinated effective Business Failures sales/ regularly called upon; and, to en¬ large working capital, the com¬ pany offered publicly $1,000,000 updated account of a company that has uniquely applied salesmanship and advertising to the distribution of An Index Price Auto Production and Industry output advanced by 2%. instalment Enterprise Economist Retail Trade State of Trade the major prob¬ providing the .credit steadily rising volume of lem has been for the By DR. IRA U. COBLEIGH Electric Output Carloadinffs before About finances, i Steel Production The truck .»• From Stifches to Riches .)/ v 5 |fh. million $50 .. Tn . ■ as a here ,m ShSwInstea(i. copor^ g^th is based • .United, States), over 1,400 emof retailers expected year-to-year sales 1 nlnvni and a sales drive that merale or one a month,and new> on expansion Of the number of gains in 1959's first quarter than;in any other major classification; hasrTt been equalled.since outlets and on. good old Dun & Bradstreet added. Three months ago this was the least Brush started giving away free optimistic of the groups polled, it noted. samples to open reluctant door . Colui;ibus, Fu;.ther> in arcas The job situation in the week ended Nov. 8, according to the The business formula at Atlas where it has no immediate plans in house to house selling and in United States Department of Labor, shows that the number of Sewing Centers is quite simple. lor outlets, it has franchisee! disMT Kern workers drawing unemployment compensation rose for the first They don't clutter up salesman- tributors who have exclusive goar(j chairman and Mi* Herbert time since mid-July. ^ / / •;/;.{ ' ship with a lot of d yersionary rights to sell Atlas products, and The 18,700 increase from the week before brought the total items; they stick to selling, in the benefit from sales and promo- turned in a remarkable performto 1,719,100. The agency attributed the rise to employment cuts in main, just two items, sewing ma- tionalguidance furnished by Atlas ance in salesmanship and the chines seasonal industries and commented it was normal for this time of and.vacuum cleaners. Sew- executives. ; training and building up-of an year. The rate of insured unemployment was 4.1% of those , mg machines ^ Finally, the compatiy has effective sales organization. These lions share of sales (about 80/»). eligible-in the latest week, up from 4% the week before and 3.3% jaunched a broad program of di- gentlemen are enthusiastic execuThe Product is the the like week a year ago. Atlas brand rect mail gale3 of an assortment tives, are the largest stockholders built undei patents (and witn q£ household merchandise In the week ended Nov. 15, new claims for unemployment (silver in the company and their shares dies) owned bj the' Company, aid compensation benefits from idle workers, a measurement of lay¬ fiatware, aluminum utensils, etc.) are now worth several million, to its own specnications, in Japan. at fav0rable prices and on an at- They are not only eager to make offs, declined by 9,300 to 291,000. A year ago, new claims dropped ,,. Nmety-five percent of the sewing tractive ten payment plan, to its Atlas Sewing Centers Inc. a major 7,400 to 301,500.; New claims totals are available for a later week machines than those on the number of workers drawing compensation be¬ pffe^edretail in the a e 0j(| customers. Atlas already has merchandising organization, but price range.; The wacuum■ a half million contented customei*s cause claims generally precede payments by a week. they are definitely stock-minded. / A larger proportion ohio'. - L& ^^ccount ^ t . ,.. $ 50 , • . , growing strength of the econ¬ national metalworking weekly,reported Steel orders are reflecting the omy, V"The Iron Age," yesterday./ i :• . v.. - buyers apparently are convinced that the business recovery is the real thing. Some mills report that .steel sheet orders are better than they have been all year. Orders for January delivery were described by one mill as "very heavy\y Some of the increased business is coming from the automotive ; . . .It declared- that more steel "Atlas" Atlas much broader, crossact. as though business es "It's beginning to look more and more finally snapping out of its negative frame of mind," this trade Continued We are on paqe pleased to announce that Benson B. Katz 36 Frary now associated with us products, com Va^UA?am/p At . they don't exactly prospect ambles into their branch offices looking of one a instalment their And are s° that the great majority of sales prospects are those who have responded to ads. There is no "cold canvassing" and the over 800 salesmen are supplied with about five "leads" a day—people being " to or £ f ' : 4 ' We are pleased to Retail Manager of our Sales Department ment TV advertising, has been elected mail, direct newspaper, plan the that CARMAN G. KING 15% involving in balance 12 Tht Investment Dealers' Association of and admitted as a partner of ANNETT & COMPANY efforts have been concentrated on the middle tion Joseph malker^$oit$ . FOUNDED 1855 has< income group, 120 Broadway November 26, 1958 Exchange New York 5, N. Y. Members: collec¬ experience on time payments been excellent, with credit Toronto Slock amounting to less than 1% a ten year period. Exchange losses over The words "sewing Members New York Stock be you a bit confusirig, might housewives imagine 335 center" may as a assembling from that bevy to - of mass produce a batch of aprons, blouses or curtains, buzzing with gossip, and Canada 18 Since sales monthly instalments. director of Members: down to a ANNETT & COMPANY LIMITED the pros¬ receives from the salesman enlightenment respecting the quality, efficiency and value of Atlas machines; and the ultimate sale is facilitated by a time pay¬ and announce Atlas pect as each company! expressed some products. Most sales are actually closed in the customers' homes. After respond¬ radio added are the Messrs. Kerns' partners in Atlas Sewing Centers, have fared-well with stockholders, who • who have already in coil- 12,000 new cus- over Centers Inc. an interest in earnings, dividends and porate expansion suggest a con- have much reason for viewing the tiiiuation of the quite remarkable future of'-.their, enterprise with growth rate of Atlas Sewing confidence. This is no "so-so" appliance. On the contrary, they have developed a technique of energetic advertising programs for crease month. All of these facets of cor- their stock this, year and they - Atlas, till wait and-have faithful and dependable in market price. The more than 1,250 letj tracts. £, Vomers Conn. Ninety-five percent $izu price range. ' Brit- craftsmen of New machine am, ing is built: on itsAtlas books' who are farniliar T*1^ want to see the common fiiu t with and is ana_is sPfc^c^®^r^.Lan^i_ ' proven & Clark, renowned Yare.. ' industry, particularly' sheets: and bars, but a section of the economy is getting in on the brand name to Atlas belting the coffee pot while f Bay Street, Toronto Jelephone: Empire 2-1485 6 (2198) The Commercial and Financial Chronicle The Soviet share in the joint stock Some Political Implications of Oux Fox sign Economic Policy companies long-term credit. 1956 and 1957' wit¬ massi ve injection of So¬ viet economic assistance and re¬ lief. This change of forced Top State Department economist notes U.S.S.R.'s resort to and development to the normal time lag. ing out how ; world iiow trade of investment. ' case policy, trade.' " to friendly ples our tions to free not course been world. stated lantic will It has in in economic field. I believe on bal¬ that it represents the senti¬ ment of the American people. strict Soviet 1 een as is in Kopeck" to any with the West to economic of the distress world. in s'eps taken are by - factors nations and reasons a our tactics to for lat J loves virtually all - made for are its world economic programs. of and reasons most istory. From intentional the stage This of sort, for operations which screen we have learned to a expect cynical ; We JJaec for j Massive Challenge The Soviet smoke sive ancient a screen program behind constitutes a the mas¬ challenge to U. S. policy from an tlm, to cut off his water supply, direct aggression to accomplish its been a common iobjugating ft is * f trade fuel, or ' the Soviet deadlock, Union turned to routes, to deprive him world objpetives. Economic by any other non-lethal economic means" to tration and: influence ments in its tactics. defeat him. are in¬ pene¬ key ele¬ The unknown to our Immediately; after World , ? st with a popularity recognized easy opportu¬ nities lor "economic cooperation" with its "friends" in Eastern Eu¬ rope.. First through, the..disman¬ tling. of plants, the taking of reparations, the operation of the so-called joint stock companies, and especially through the dicta¬ con- - the Russians to win the 3ove of the "uncommitted-world?" knock-down -- drag-out fight to the superiority of commueconomic statism over free I rove i ist * aterprise ^ here the capitalism there is in room other but not for come twilight sort of for tion of-terms of trade overwhelm¬ ingly favorable viet world a one both? chev i an A" to was of itself, the So¬ able to an milk the incalculable amount of real wealth. Or This yield of nourishment from economic "economic co¬ operation one enormously strengthened the Sino-Soviet capacity to dispense aid later in underdevel¬ hand, Mr.1 Khrush¬ militantly states to an Amervisitor, "We declare war oped address Union satellites or •coexistence?" On the had the smoke of battle 1945. than-tha Soviet Union . — •find ourselves: sooner cleared an country. *. It might be useful to ask our,rolves in just what kind of v olitical-economic situation do we War II, the Soviets consolidated their economic, positiorf through force. No own . . by Mr. Murphy areas, a type Peter to pay Paul" before First General Session of the 45th Na,nal Foreign Trade Convention, New York City, Nov. t te 17, 1958. leading to no guarantee that this is so. And there is very little chance that any drastic capital economies will be a r s we ^ achieved lha.,-'-; by the mid-'60's. does that nies that leave- the must -R - expansion steel Where compa¬ h major ^before the a u n c programs mid-.'60's if the economy grows as expected? Y '- , v;u>. ; ' f The best way I know to answer , , , va.te that question is to penetration, and to. drive 1 l _ . • 1 -• use __ _ . _ J. 1 1 .. T " ! J A I _ J. i wedge/hon tons of a _1 _ ... . _H"' f . i'.. new capacity per year. 11 <1 "M-ri M tr r» n rt . Ill i will cost not less than $560 gram rt' years gotiations to WOrld1 , East-West trade has bccii .• :,.T .. ;4>rtYW'hifesI'am; gazing'into., the enunciated the goal of man; and T feel about them conrrmu- as an nist Bloc, v,iets self-sufficiency; the .'SoY,engineerfeels about - steam enorganized a so-called'- "WoHd^glpes. But I .think 20^^ years .from Economic Conference" in Moscovy;> now; b e cause o rowing and; the, sale' of common stock;'.; ?"•;'..'v;Y- Y;"Y/ f technological to World this terms ;ers' and- pneumatic processes. Y;■ ail'. Eyery pftia^ of steeimak^ Soviet; finishing vvill be subjected ,to in- approach - to Countries, favorable Union. Free - genei*ally to - • the - ;>jY;:Vl9'nsiv.e; research;,;.and • Three-Point Program ' . ^ There are many contributing factors to inflation," but if we can learn make substantial progress in-three attempts to subjugatc^;1.11^^ about the physica^an^ metWestern Europe and to drive a ^inigical., problems involyedv Yhe wedge between the United States'- automation of large volume, proeand its friends thus far have ^sses, will accelerate. ^Eventually, specific areas:! think, we'll have r T h A further possibility, of to attempt to neutrijlr' course, was i^e as e or ' computer control ol processes will tuk^much bf the guesswork out ot steehnaking, and lead to marked alienate from the West the developed iwpi'Pvement m quality and a corcountries in other parts of the. responding .• improvement-; m" • <?ffiworld. The story of Soviet :ma-;-;ciency.. y . . : V/Y Y neuverings in Asia, the Middle Because these changes-will take uneommitted , or less East, Africa, and Latin America:' place; slowly, thereTwilt SeYcomis tpo complicated and devious lorr paratively little manpower disme to deal with hero. Let me * placement. tlie problem First, ernmerit. ; voa^,-^0 add realistic • individuals panies. - Y- ; Second chinG and com- we need to improve the our production Wo have made vreat in , sure -y:;:.:YYYY efficiency of ?ess gov- tax; reduction, improvement in incentives an for Q licked.- need economy in This is the only we ma- nrov aro^buYwe this harder than in ever tftan ever Instead, there will be the merely mention the example of iaCslow but steady decline in un- r,*•' • Yugoslavia where the Soviets and ^ skilled jobs," a parallel increase in T ■ » we ueed greater cooperaThe Bloc—especially the Chinese...skilled jobs; and a continuing in- tion betweenvlabor.and"manage—have gone through every- stage 1 crease m productivity, v! - ' mentto hold down wage inflation, of the hot and cold of polUical* This improvementan productiv- We've made some progress in thfe economic warfare, promising one. ity is crucial. It is the key to bet—hut "iiot* raarlV ehoiielT Prol day and taking away the:next.JLgt. . tor earnings, better*wages, and a aEea> me1 also mention tlic example qfv rising standard of living * ductiyity in. the steel industry, for sturdy Finland, another target 0Y ^ * ' ^ v *' example, :has,i been .increasing at direct economic pressures'by:-.the •' : • Problem of Capital ^ 'ei_„ +i - „TOi USSR; Less apparent:^ perhaps ^,Many problems will develop as " war, but no less coercive is the story of wages have been increasing we moye ahead, but there is one ,. , - blandishment of gifts and -ibute has at times played a very important part in this, pattern. >I>onomic warfare in time of war 2 ft cs not been changes confusion the forces of communist imperial¬ ism. Faced with nuclear as technological lower capital costs will bring these costs closer to earth, but there is next manipulation for penetration > turned times, it strategem in enemy to starve J The failed. •political purposes." To some ex¬ tent this has been true throughout , over communist shrewd, clever and opponent. rea- Chairman -Khrushchev has iccently said to a United States \isitor: "we value trade least for conomic of standard exploitation. what economic , of carefully planned and focused-, are anything but confused, is are and sons. < set and Among political That would psychological smoke H iese factors the Soviet, Union, with utter frankness demonstrates t fabric and economic reasons. 1978. expenditure of Republic as a Wedge ^ in 1978, the an;-example. ' Having just com¬ step to consolidation steel, industry in that year will pleted a $200 million expansion of its hard-core position within'', peed a--capacity oL well over 200 program, and being deeply in¬ the Bloc was for Russia to stormYnillion tons, a whopping increase volved in laying long-range plans the citadel of capitalism in West- .ol better than 60' million tons over for the next one, I just happen to ern have some figures at my Europe ,by every sort/of at-?.■today;-[It would mean,.in fact, an fingertips." Our next major expansion tempt at political and.' ecbnoikic;' avei^ge" ineroas^of about 3 milpro¬ U.SJS.U. Tries to Drive the •' An easy conclusion to- be drawn • close and important as it world today. Political for political eeps It as ground .estimate of 230 million ;.v : of per year. / /•'Y 1 ;<■/ possible,Yofi course, that * Hie/rhid;dle- •- end average Khrushchev the through the economic 1 economic dcY^-y e an That Perhaps never before in world from all these conflicting Soviet history has the interplay between declarations is that they make up and be these to a venture $1 billion Its ' some $20 bil¬ capital between now new Union States." limits the capita, and consumption^ conducted/:Port- reaches was the bloc. capacity in the steel indus¬ try will have to find . the ance political trade within new the average year, in Jhr. popula-Y foreign ' r million tons of 3 and , . . over lion seJlY ^ : contained nature is well illusY 9a^ a'.® trated by the fact that in J957 ls bue, and/ifthree-fourths of - Russian's entire 1952? VY crystal this magnitude requires careful Staidly used id a futile attoi-iipt(:t-o '; balbyf may aS well stick my neck, planning.:; But. more important^: it. disrupt the Western alliance aiid out, .and discuss some interesting requires, a healthy and takes advantage of this opportu¬ prosperous its'system of strategie^■drade-cbu*-;Y.probabilities.* It pains me. tq^say indqstry,,, andv company earnings nity to charge us with an attempt trols. In 1952, the year that StifliiV, so, ; becauseI'm a blast:C"tbrhace that wiR justify^^ both heavy bor-' tt> enslave the rest of rest our organizations the give "Not relieve occasions, in the At¬ Charter and related relations United are joint guide¬ lines for the United Nations and its from "cooperative relations" is later shown by Mr. Khrushchev's in¬ dignant statement that ; Russia of in different ways on number of a is This doctrine. new a the there Murpity stability of the governments the trade between and Hon. Robert promote the of United credit a signifi¬ step will be taken along the road leading to the establishment of cooperative rela¬ independence and thO and large a forward cant pur- is pose with normal peo¬ concomi¬ a we facilitate to in per foreign large ip their total to the further tons maivixi^ capac¬ ity of 1*637 lbs. " since .its Stalin aimed' at in the us steel industry the next two decades? Y Today, we have an annual steel- velopment of that bloc seif-suffi-;;P1^ cicney which the late? Joseph h^ed 1,800 an¬ it, and Mr. Mikoyan states that he "Is confident that with the establishment of as out the world. As Russia States, area-wa.Y potential of the the , This has led ^ , problem of inflation. can measure Union has o f . s te el h a s long,-! erinYb een y rising through 1965> to' faster than the satellite regimes, Y > population;' In ' Commitments each of the Sometime later he writes tween us through¬ tant the What-yardstick po- to end the - . . economy, the Soviet. been obliged to make . "To so predicted, about 60 million '1- Union and trade looms ; 'Let us arm,' slogan 'Let says Soviet the -• States well ' At declares, if over Soviet countries, will win we States." for today plays overwhelming role in the for¬ eign trade of each of the satellite long letter to the President sug¬ gesting closer trade relations be¬ security of the iieople of the as he control The ;; a promote the welfare and United that war United time slogan that reply with our is purpose A ... the over other atoned to be maintained in the peaceful field of you trade. and politi¬ our cal production international As in the of and lltical Concludes by pomt- and, for example, reports that our Development Loan Fund in its first six months of operation had application for loans totaling over $2 billion as against an appropriation of $700 million since last January. upon be must ■ Board, Republic Steel Corp. rising popula¬ today's capacity of 140 million tons; (2) displacement of blast furnace by other processes; and (3) overwhelming problems of meeting capital. requirements because of inflation. Offers three point program tion an needs The purpose of our foreign eco¬ nomic policy is the promotion of political occurred in October, 1956. T h e Soviet leaders apparently realized that the economic sins of the past have been responding to free world financing we by By CHARLES M. WHITE * ; ~ Chairman of the Steel leader forecasts: (1) 163 pound.per capita increase in steel capacity by 1978 which means, in terms of Hungarian uprising and the change of regime in Poland which Mr. - USSR was of the manipulation to set the stage for penetration and exploitation." , the on Y. Y considerations. It is noteworthy also that most Soviet assistance:.to the satellites followed on the heels S. Department of State Murphy depicts the choice confronting underdeveloped countries, in their revolt against misery and poverty, as one between Communism and our own western system of individual liberty. He hopes they wiH have patience to adjust their growth Vv. a policy indirect aggression to accomplish its world objectives and its deliberate "tactics of intentional confusion and psychological ; Long-Range Outlook fox Steel on period nessed Deputy Under Secretary for Political Affairs U. "sold" to the satel¬ was lite countries The By HON. ROBERT MURPHY* - Thursday, November 27, 1958 ... of "robbing operation. But it could not go on forever, and the pattern of outright exploitation had to be revised in recent year§. t , „_01. JY . Soviet and relations initial with efforts the in UAR, Latin America today is a tempting target. Who Are Today's Imperialists? Is this imperialism or not by a government which claims that we, the American, and The West are imperialists? The pages of West¬ ern history may not be spotless, but it cannot be said that not: learned.- How that Morocco, we many have Soviet it - overshadows seems Up the slope of the problem is capital. The steel it today of a little Continued on page 31 we gaze That years. built at. we an know than $70 per ton of ingot Yet it would be practi- $300 per it suppose new v *From ^"b a ton. The stabilizes- at talk by Mr. erted If • the $350 we White per build before a a on and Swages leaders has ex¬ powerful inflationary ef¬ the : and and economy, responsibility wage of both Is to.. seek managers levels which it labor in the in- of are living, terest of all the people. Since present still-upwardybut let's capacity. productivity average over cost trend is at about 8 %. > This spread between fect as cally impossible to build a large, intergated steel mill today for less aid programs, by candid analysis/ ton of be shown to have the objec¬ helping less fortu- industry was capacity. can tive of merely all-others, and to loom larger as Per,yeai. smce-the standard our and perhaps our very existence as a nation faith are that solved. at this And' stake, I have great problem if ' it' is, fear of the future. I will te have no _ „ i Voiume 183 Number 5798 . . The Commercial and Financial Chronicle . (2199) SaMMi Xw'*vX' gg mmm go overseas..... use Manhattan's world-wide Chase network of 51,000 When- you !. trade international problems to: the people at The take your Chase Manhattan Bank, the services Chase Manhattan and its stateside correspondents handle the U. S. prob¬ lems of the Bank's overseas ; bankers-at-the-spot contact can best If you corre¬ the banker-at-the-spot who help you. have import or export prob¬ ' world-wide network of 51,000 spondents. They, ,iu turn, get things lems, phone HAnover correspondent banks and branches are done for Chase Manhattan in their to of ; <•' a immediately at your disposal. Whatever, or wherever your prob¬ lem, you get the overseas help you need from the the man banker-at-the-spot..„ who has an intimate knowl¬ edge of local, trade conditions and knows how to make them work for you. This is possible because Chase Man¬ hattan has a close personal relation¬ ship with its foreign correspondents. own countries. Such enables you to get more reciprocity efficient bank¬ ing service in the markets of the world. Here at home, experienced men the International and talk ally. They work with individual you person¬ you on a basis of analysis and imaginative planning. And knowing the right men in the 2-6000 or write Department, The Chase Manhattan Bank, 18 New York 15. " • Pine Street, ' THE in Department sit down things out with International right places, they can quickly Chase Manhattan bank Chartered in 1799MEMBER FEDERAL DEPOSIT - " " INSURANCE CORPORATION 7 8 Petroleum Situation—Review—Chase Manhattan leum Treasure Atomic Letter No. 42—With reports on Geneva Atomic Confer-* Atomic — Coast Aircraft & Securities Co., Inc., 1033 43 Brewster Bartle Discussing current expenditures — Winston & on and Pronto Uranium Mines Ltd.—Atomic Development Secu¬ Co., Inc., 1033 Thirtieth Street, N. W., way, Automobile of Tomorrow—Review—National Securities & Re¬ Dobie and companies available Also request— New York Hanseatic Cor¬ on Frito View — Monthly investment letter — Burnham Company, 15 Broad Street, New York 5, N. Y. and Also avail¬ — Bulletin Purcell & — New York Pressprich & 'Co., 48 Wall Electric Power and Light large companies — Street, Companies—Comparative figures Reynolds & Co., 120 on 55 Broad Street, to Use review are For Jos. Walker Sons of the New York Stock Ex¬ Katz is „ Co., Street, N. W., Washington 5, D. C. Thermit & firm associated with their now as manager of the Retail Sales Department. Investors" Stock Also American Investor, American Building, 86 Trinity Place, New York 6, Exchange N. Y. — in the — issue same is article an Aviation and Engineering, and reviews of on New York. on Preview—Analysis—du Pont, Homsey & Company, 31 Street, Boston 9, Mass. • Over-the-Counter Index—Folder showing an up-to-date com¬ parison between the listed industrial stocks used in the DowJones Averages and the 35 over-the-counter industrial stocks used in the National Quotation Bureau Averages, both market performance over 19-year a National Quotation Bureau, Inc., 46 Front as period to — Street, New York 4, N. Y. - Street, New York 5, N. Y. Also available is Denver & Rio Grande Western Railroad, and Ltd., 1 Wall Street, New York 5, N. Y. Country—Review—Bank of Nova Scotia, Toronto, • River Adelaide Co. Radiation, Inc.' Ltd.—Data—Ross, Knowles & Co., Ltd., 25 Analysis — —- . . Associates, Inc. Sedgwick County, Kansas Flood Control and Voting Machine General Obligation Bonds Bulletin Ranson & Company, — Inc., 208 South Market, Wichita 2, Kansas. Analysis Broadway, New York 6, N. Y. — — Schweickart & Co., 29 for as the Cus¬ year Education—David Bell, Herzfeld & Stern. Employment—Gordon V. Price, Laird & Co. Corp. Entertainment Frank, Albert F. Ladenburg, Thalmann & — Grievance — MiltonLeeds, Legal and Research—Edward S. Wilson, Hallgarten & Co. Membership — Gerald L. Wilstead, Hallgarten & Co. Pension and Welfare & E. E. Stern & Co., 52 Wall Street, — Nicholas Crane, Dean Witter & Co. Professional Ethics — Marshall Dunn, Wood, Struthers & Co. Company—Analysis—Grimm New York 5, N. Y. Trico Products United Brokers of Pershing & Co. — & Co., 44 ... Bulletin Air Public Relations — Albert P. Gross, Bear, Stearns & Co. — Strauss, Ginberg & Co., Inc., 115 are bulletins on North American Refractories and Ft. Pitt Bridge Works. Acoustica serve Activating — Frank Dunne, Jr., Merrill Lynch, Pierce. Fenner & Smith. B. W. Pizzini & Co., 25 Broad Broadway, New York 6, N. Y. Also available . will Association Co. Street, New York 4, N. Y. Tappan the 1958-59: of Street, West, Toronto, Ont., Canada. Webster Inc.—Bulletin—Herbert Wall Street 5, N. Y. financial institutions report Railway Co. and Union Pacific Railroad Co. Stone For a survey & Santa Fe Railway, Baltimore & Ohio Railroad, Gulf, Mobile & Ohio Railroad, Northern Pacific Railway Co., Southern Smith Douglass Co., Inc. Ont., Canada. a to Atchison, Topeka — Paper Industry—Review—Calvin Bullock , Corp.—Report—Thomson & McKinnon, 11 Railroads with particular reference Powell following of tomers' f Wall The Chairmen of the various commit¬ tees — Analysis — Amott, Baker & Co., Incorporated, 150 Broadway, New York 38, N. Y. Paramount Pictures Committee Chairmen Continental S. Klein Depart¬ ment Stores, Inc. and General Transistor Corp. Yamaichi Securities Company of New York, Inc., Ill Broadway, New York 7, Customers Brokers Corporation—Discussion in November issue Pan American Sulphur Company Currently active Mgr. change, announced that Benson B. "American of Also in the dustry. Peace River Katz Retail Sales Corporation—Analysis—Stanley Heller & Co., 30 Pine Metal brief analyses of Asahi Breweries, Nippon Japanese Stocks —Current information and (Boca Raton, FU.) National Security Traders Asso¬ ciation Annual Convention at Joseph Walker & Sons, 120 Broadway, New York City, mem¬ — Analysis — Singer, Bean & Mackie, Inc., 40 Exchange Place, New York 5, N. Y. Ilodo, Nikkatsu, and of the Japanese Nonferrous Metal In¬ yield Hotel. Jcrrold Electronics Corporation Options—Descriptive booklet—Filer, Schmidt & rities Co., Ltd., 61 Broadway, New York 6, N. Y. Milk a Inc.—Analysis—Mitchell, Hutchins & Co.—Memorandum—Walston & 734 Fifteenth Japanese Market—Review of current situation—Nomura Secu¬ Market Company, International Bank of Washington—Memorandum—Weil & Co., 120 Broadway, New York 5, N. Y. same Amer¬ Nov. 2-5, 1959 bers York 15, N. Y. of Co., Inc., 74 Wall J. Heinz Hertz New Investment meeting at the Hilton the Boca Raton Club. Street, New York 5, N. Y. Banking Department, of Association Corporation—Bulletin—Russell Investment Com¬ Street, New York 5, N. Y. Broadway, New Foreign Exchange Quotations—Manufacturers Trust Company, How Green Group Bankers ica annual Haupt & Co., Ill Broad¬ Co., 1 Wall Street, New York 5, N. Y. 5, N. Y. International the Southern Hotel. New York 6, N. Y. 5, N. Y. II. York — (Baltimore, Md.) April 1-3, 1959 (San Antonio,Tex.) Rubber—Comprehensive information—Straus, McDowell, 111 Broadway, New York 6, N. Y. available is a study of Texas Industries, Inc. Boston Building, Denver 2, Colo. Also available is study of Academy Life Insurance Company. L. * Baltimore Security Traders As¬ sociation 24th annual dinner at & pany, Co., 50 II. W. Jan. 16, 1959 & Golden Cycle Broadway, New York 4, N. Y. Copper—Report—R. Tire Company way, - dorf Astoria. Guests invited. — Co., Adolphus Tower, Dallas 2, Texas. General Tire & Rubber—Review—Ira able is current Foreign Letter. Business and Market Review Memorandum Analysis — Dittmar & Company, Inc., 201 North St. Mary's Street, San Antonio 5, Texas. poration, 120 Broadway, New York 5, N. Y. Bnrnham Whyte's Restaurant. Bro¬ Party,, at Dec. 10, 1954 (New York City) Investment Association of New Corporation—Analysis—Sutro Bros. & Co., 120 Broad¬ New York 5, N. Y. Blosser Stocks—Quarterly comparison of leading banks and trust Customers kers Annual Christmas Texas Cooper Ltd., 25 Adelaide Street, West, Toronto, Ont., Canada. Bank — Company—Analysis—A. G. Becker & Co., Incorporated, 60 Broadway, New York 4, N. Y. Company America annual convention the Americana Hotel. Association of ■I Cleveland Cliffs Iron Corporation, 120 Broadway, New York 5, N. Y. Theory—Bulletin—Draper at York annual dinner at the Wal¬ Dallas Union Securities Washington Carrier Index — Campbell Taggart Associated Bakeries Inc. 7, D. C. search Analysis — Rowles, Co., Bank of the Southwest Building, Houston 2, Drilling Company Inc. (Mima Dec. 3,1958 (New York City) • Texas. atomic energy and comments on Baird Atomic Inc., Tracerlab rities ■" ' - Refining—Analysis—Halle & Stieglitz, 52 Wall Street, New York 5, N. Y. ; '/ •;< of , 1 1958 5, Investment Bankers Associativa Eleetronic ''v..• 39-Dee. Beach, Fla.) ■> - Ashland Oil & ftdrtieth Street, N. W., Washington 7, D. C. Atomic Letter No. • Field- Investment ■ Companies—Report—ShearHammill & Co., 14 Wrall Street, New York 5, N. Y. . Philips Lamps and Cenco Instruments Development In Nov. son, Cotp. area lion, 120 Broadway, New York 5, N. Y. West navy, of the EVENTS Book describing re¬ served—Utah Power & Light Co., Box — 899, Dept. K, Salt Lake City 10, Utah.* following literature t the nuclear in the Growing West Treasury Refunding—Circular—New York Hanseatic Corpora- it i* understood that the firms mentioned will he pleased to send interested parties the ence, COMING discussion-of industry trends—G. H. Co., 1 Wall Street, New York 5, N. Y.¬ Chest sources > Bank, Petro¬ Outlook—and Walker & Recommendations & Literature Thursday, November 27, 1958 ... Department, 18 Pine Street, New York 15, N. Y. Securities Bank Chronicle The Commercial and Financial (2200) Lines—Bulletin—Bache & Co., ' New York 5, N. Y. - 36 • Wall Street, - Speakers — Leon S. Herbert, Hayden, Stone & Co. Uptown Managers—John Leavy, Bache & Co. ,. The newly formed Employment Committee will endeavor to assist Cutter Laboratories A & B any Magna Theatre Corp. qualified individual who wishes aid. All information and contacts will be confidential. Microwave Associates, Inc. Orradio Industries Inc. Anyone Available • interested may call Chairman Gordon V.Price at Laird & Company, Corporation.The Com¬ mittee comprises also: Mrs. Hazel Anderson Republic Natural Gas Bank & Quotation Record running Bought — Sold from Feb. would Troster, Singer & Co. Members New York 74 actually to Jan. cover 1957 consecutively inclusive. Which quotations from the full Co., Nicholas Novak of DrysCo., and Thomas Meek of Harris, Upham & Co. Pansiatic in Newark Security Dealers Association NEWARK, N. J.—Pansiatic Se¬ Write Edwin L. Teletype NY 1.376-377.378 & dale & calendar years 1938 to 1956 inclusive. Trinity Place, New York 6, N. Y. HAnover 2-2400 1938 of Gude, Winmill & Co., Milton Leeds of Pershing & Co., Edward Wilson of Hallgarten or Phone—REctor 2-9570 Beck, c/o Chronicle, 25 Park PL, N. Y. 7 curities Company is engaging in a securities business from offices at 233 Wilson Avenue. Albert man is a Engle- principal of the firm. Number 5798v.. The Commercial and Financial Chronicle Volume 188 (2201) 9 lead many to fear that purInflation—The Other Side some of the signs suggesting thai suing the Employment Act's obDespite the influence of these as we look baclc some years jective of maximum employment, factors making for inflation—and hence, 1958 may mark: the high income and purchasing power"; they are powerful—I believe we point in the inflation-tide, ever, Growth of Employee Benefits And the Tread of inflation -.r;: By W. W. TONGUE* • . leaves^ the.economy much-more open to the \ ■ Economist, Jewel Tea Co., Incv Melrose Park, Br. • feared r ■ . that the Federal ment will continue to be 1 try to slow Business economist explores thenew world of employee benefits, which he finds enjoys a faster rate of growth than the level of income, and comments on the impact of price inflation on this long-term trend. Dr. Tongue1 describes the factors that offer the prospect of holding inflation and believes chances for this are brighter .today than at any time in the past 20 years. Nevertheless, even if the pace, of inflation were kept in check, he finda the projected rate of per family income growth will be such? that as a result the amount set aside for employee overcome to act - Govern- look back in it outlook. is for inflationary years growing the vigor of the postwar inflation feeling that the phenomenon of is running out. It is always diffiadministered prices in our large cult to pinpoint the exact time industries, combined with collec- when such changes in direction tive bargaining with powerful occur because there are cross cur: unions on wage rates and other rents always at work and one £ employment conditions in these wave may reach higher on the /""*• industries, tend to insulate the shore than those which immeprice system from the usual re- diately preceded it even after the straints on inflation through fiscal tide has turned., Similarly, even if i; benefits will probably prove inadequate. Urges management and monetary controls. We have the inflation tide has turned, we to explore areas where they can expand fringe benefits graduthe familiar "ratchet effect" in the may continue to have price inpattern -setting industries, in creases here and there, reflecting ally in order to forestall an otherwise inevitable entry by govt. which wages and prices move, in prior increases in costs or current Employee benefits constitute a tions to social insurance. Add 10 one direction only—ever upward, increases provided in previous in significant and:.; rapidly growing years and the figure becomes an To make matters worse; in the contractual arrangements. part of the economic life of the astronomical $400 billion, or more country, contributing importantly than the entire national income »ot co^ernea to human.:. todav' While this seems utterly ine aaaitionai mtiationaiy impact the precise date at which the tide ' - 4 reminded promising to ,make future. As . „ indi¬ cation of the of been no for an the more than a probable govern¬ calls to wages of success for these men This 1957. is a and the attract which factors future f of our ""n* . Continued on page employee to answer for 1929, over eight times the figure for 1939 and nearly three- times the figure for 1947, Interestingly enough, the annual rate of growth seems to be approximately the same no ^matter what year is taken as a base. In this, respect it is in ac¬ cord with "Parkinson's Law." Since 1939. the 1947 crease $ Resources . Securities • ' per of Call Loans - in¬ annum. to be the 4% over is or per annum average the whole period since 1939, it to likely analysis of the factors influencing the growth more, or of staff be something any London in November,, 1955, which was generalized into Parkinson's Law. ; The Law states that at the - rate mately 5%% per grows , ; staff of work Forces Making for Inflation great uncertainty and a general fear that inflation is in¬ evitable in the future. This feeling swelled this past summer as it com- operating end of the became True the ;\ But obvious that the business to A 7 benefits Growth growth actually Industry of per degenerate into ness depression, not going was a as serious busi¬ feared, the continued to rise month by month throughout the recession. annum, or Most economists feel that the recovery now under way is genuine, and I certainly share this ap- proximately twice the rate called view. Based on past experience, '.for by Parkinson's Law and also .about twice the average annual economic activity should continue to expand at least into 1960. The rate of growth of national income is a milestone of enormous significance. -It. marks the third time since the close of World War II that we have entered a recovery -the period;since 1929. We dealing with ;a true growth industry. * over are - is- It intriguing -to project this, rate of growth into the future, By 1975, only 17 years Jiencer,wq \ could expect ai figure of at least $135 billion.: per annum for the total of supplements'to wages arid salaries: and employee : contribu. - . - • 'An • • ; - address by Dr.. Toncue City, . f period of business contraction and. come our after only a very minor period of adjustment. This is unprecedehtM ih our history and is valid evidence, I believe; thai the concepts and philosophy, underlying, the Employment Act of 1946. are. working as V ^before :W&. Premises Acceptances f'Ctedit " " • and letters o Sundry Assets . . intended. The very success in overcoming' Busings declines in _the three postwar recessions to date, how- 14,462,061 184,883 135^572532 ^ ^ 20,38i^55 672,694 $1,653,957,844 liabilities 1,295,755,034 5,352,435 6,222,438 Deposits . » Gtlier Liabilities 1,660,180^82 • 14,506,213 ToulUabimi«totkePub, and Letters CapitalPatdUP-. • Acceptances Account . , Undivided Profits • Kest Statement of . 20,121,68^ 48,292,050 ^ 549,153 • # 001,107,469 14,462,061 20,000,000 46,000,000 1,002,802 # 1957 Undivided Profits 1958 9,796^51 Reserves Less: Net Income Profit T „s8; & . Taxes • , , . • 5,050,000 "4^46551 2,800,000 • 400,000 Dividends . • ♦ Extra Distribution 1,546,351 1,002,802 some employee expectations- of Parkinson's Law, Irrespective of the base taken, ttie rate of growth comes out to li% to 12%. recession 1957-58 and as the Consumer Price Index surpasses Bank . . . At the moment the air is filled business. r* N.H.A.M°«8JSeLM * 720,890,952 586,082,243 40,570,238 626,637,247 66,540,437 22,415,037 14,506,213 * • * with p o u n d e d, irrespective of the amount of work actually being -done at the • ' • • 254,137,863 375,265,156 91,487,933- , Quiet Assets Loans * approxi¬ annum something less? Is there chance that we can actually stabilize the price level? functions, first published of . V, ' 278,806,381 556,968,137 177,103,240 # # * • • . 195 7 I958 . tongue-in-cheek "The-Economist" Total Current is approximately Is the rate of inflation in the future more likely Some may have read the Parkin¬ -in • Cash has averaged 2*4% rate OCTOBER 31 AT AS one, — Annual Statement 103rd whether we can expect a continuation of the inflation witnessed in this country in the past 20 years, The Consumer Price Index prepared by the U. S. Department of Labor has increased at an average of nearly 4% per annum since ing figure - automobUe a larger ' •*NK Tl*> might attention—and difficult most •is almost 30 times the correspond- * Sfore for which' we must provide today. I would now like to discuss ' inno¬ benefits, perhaps the first question to bring out the growth that has occurred', we may note that the 1957 figure of $23.1 billion son the to affect To . next successes vein third larger than the amount spent by consumers on automobiles and parts. = $12.2 billion ending are their items in than .more v some year since World War II. surprised more often by than, hgr their fail¬ ures, and so are usually unable to capitalize opportunities that This covers contributions by em- could have been anticipated. The ployers for social insurance, work- manager who merely tries to keep man's compensation and employer his plans and policies up to date payments to private pension and is already out of date. He, must welfare funds: To ibis may be keep them up to the future, where added $6.6 billion' bf personal the objectives of the business contributions for social insurance, will be achieved." making a total of $23.1 billion As we look in a more serious - fiscal w; W. Tongue taled $16.5 bitlion in 1957; r „ vation, This is why able business¬ and salaries" to¬ . , turned. Our benefit year, not only because of rising programs, particularly those re- labor costs, but also because , of the trend toward making the in¬ current research in vestments "Supplements • par- extension of past trends and have failed to take into account the ment i is that of transportation. In straight-line dustry, what ; logically expect some tendency for basic food prices to work gradually ; downward over -the next year or two. Another area where price advances have- been relatively large can business plans have the . sharply: and with cattle numbers again-on the increase,.we vance ^^V'^^iSrkS ^p^Jhwn^j^a^to " J 7. ^But June 30, the largest deficit for any years year "Too often, size of this in¬ several made mated to total Mr. Chairman Company, in For years. °f a Federal budget deficit esti- may- have am He said: ago. an he address the of words the General Electric greater contri¬ in of probably is—I Cordiner, Ralph an even bution and levelling in the example, foodi prices: increased by approximately 12% between February, 1956 and this past summer. Present indications are that with crop production at a record 117 % of the 1947-49 average, with hog production scheduled to ad- a fo^addh^ fantastic welfare and a been/the first real evidence that level in the past few addition, there is ^ . rate of ?ise inSome prices which have been important in the over* all increase in the general price we to come, may well turn out to have upon t „ In the first place, the immediate Very possibly the settlement with the United Ford and ^ Why Prices May Level Off the inflation tide may quick to"Automobile,, Workers,, when recessions against turn in a not be far off systems. In the signs multiplying that can see pressures of inflation than to those of depression. It. is ^S^Bnausla^ard ^^153 2^00^00 ^549^53 Tranaferred.oRestAccoum Balance of Undivided Prof'ta Head Office: 8,181,934 4,100,000 "J^L934 2,596,909 400,000 "loSJS L9W77 ^ooSS 2,000,00CL 1Jo5o2 A. T. Lambert General Manager, Toronto 26 10 The Commercial and Financial Chronicle (2202) threat of continuing inflationary The of,enlightened purpose Treasury Faces Debt Management pressures, I believe it is- important to note that positive signs of in-, Long-term And Sound Dollar Policies fortunately few and far between, other demands;for monetary policy is not, of course, to stop credit from expanding, flation in. the immediate future Wholesale of the Treasury for Monetary Affairs Washington, D. C. financing Treasury spokesman intimates government's future policy. Mr. Baird avers the government is no mere residual claimant, or marginal influencing factor, but an aggressive a share of the nation's savings, and that the market sector should pursue "aggressive cooper¬ ation" even when this appears to involve "some sacrifice of immediate advantage." Moreover, he directs attention to neglected national mandate to preserve purchasing power con¬ This should not make mortgage debt tstanding ou today exceeds billion, $150 times much after the war. have I As as right as ■consi dered these figures, I have often of value the little far too public Julian B. Baird recog¬ of the nition not is a number a government cannot risk < of ravages evident . a We in the we can, • of to j all too the to do the cash much of the recent concern about • , Inflation is man-made and revolution has occurred is man-controlled. b.e can how find to best to Our job it control ' • - . deficit. In _ is mortgage production and the with how questions continues to be. maintain That are ahead in the face of un-r precedented peacetime demands years* on our both financial the the government resources Government and from our and the Of* the dollar thus help to provide one of ingredients of a and growing economy. essential sound . the value You will note maintain tary the a and; fiscal job that stable alone. said I dollar. help Mone¬ policy cannot do There is the also rapidly growing economy. question of the wage-price spiral The Treasury and the mortgage bankers of America are both such which has to be solved. as ours should A nation realize that deeply marking given marking up prices beyond is justified by in¬ creases in costs does not produce more goods and services. Expe¬ rience teaches, on the contrary, concerned in finding an answer to this problem. The asso¬ ciation has recognized this fact in the strong support which it has occasions to sound fiscal and monetary policies. I want to speak frankly on some of the significant aspects of our number one objective in the fi¬ on many up wages in excess of the increased productivity of our economy 1858. and what that the result in the end may to produce less. Basis Lacking for *An address by Mr. Baird* before the 45th Annual Convention ef> the Mbrtfage Bankers Association, Chicago, Illinois. Nov. 3, nf or as involved as well and each has its special pleaders. I can well understand'that some the mortgage industry may feel times that you « are - asked' to bear undue hardships as a result varying demand for funds else. . ... x connection, .let' me urge again that it is* in the interest of all.: of us that the government have meet its.obligations by mean& oif program sound a debt-management- pro- borfowers for available investment ^purchase funds. tor lor a share oft the Natipn's In a when with private'has situation like there i* the- commitments to * Housing Act authomty-not>sm- present, General heaw a made now the full billion, dollars of mortgages under the Emergency : in view of the fact that the ;a residual claimant. It-means^ for the private sectors of the eeonb what I might call "aggreasive cooperation"—even when this S borrower and therefm-e £°ing market rates. may appear to involve some saeribears the sole responsibility for There is. a* place for. soundly flee of immediate advantage, , : whatever amount of excessive conceived^ government- measures Avoiding Sueculative Excess 5' bank credit extension may be oc-"" which will;.help reversq? a:' cyclical t *«. curring. This, of course, is a seri- downturn. Yet. we must not lose We in the Treasury recognize ous misconception. Both national'slght ot the fact that heavy gov- in turn^ that conducting, our operainterest and,sound financial policy ernment commitments,, such as tions in, the atmosphere of a ^ee require the proper financing of those in the housing area, bring money market , sometimes gives the national government and the; with them a ^number of special rise to special problems for- us. needs which the people, acting : Pr°hlems; We must remember that While fluctuations in market through Congress, have asked it the lending activity of; the Gov- prices and yields serve an importo meet, as well as proper finane- ernment does not bring a net ad- tant function in our private endemand for funds Federal Government Act unwisely provided that mort- freouent.lv one expressed hears the belief When that But 'must also accept responsibility to and conduct, monetary and fiscal pol¬ having to icy in such a manner as to .help money us. we , evident is significant is the question of going to maintain the integrity of our currency in the with this vear gram* Thisv means,;* for the Treas>ury, being an aggressive competi1- competitor is gage? be Purchased at prices which reflect interest rates well below that the the mar- . of funds toh fhe-market, as ,e Government.must compete in economy and of has specified that the govr^ State and local governments. has a responsibility to promote maximum employment : * Federal Debt Decrease As and purchasing power in the econ-. Per Cent of All Debt omy. To fulfill this mandate it distribution. most far-reaching do Uoin* tin'-taiiinn eo^rnment foanT erants mher lrogran^ Evolved well and each has added another $200 million. FNMA a ernment banking field and elsewhere, industry and fi¬ nance have worked together to solve many complex problems of of hv the vou Just RffitalrK ... the farm housing consequence, Government gress Currency's Integrity one if debt, but- it 'above the- estimates made in Janfrequently uary. Direct housing loans by the money: to * cover Veterans Administration and for new Federal strong Treasury believe that we the m.,J fVl' A to stimulate maturing borrow are bout it.. inflation—particularly evident in the .financial markets—reflects a misguided notion that continually rising prices are inevitable. Noth¬ ing could be farther from the truth. volume seldom without' unduly -restricting indi¬ thought to give credit,to vidual initiative and freedom of the financial community for choice. bringing it about! Through your Purchasing Power Preservation own efforts and through legisla¬ Mandate tion which you have been instru¬ This is not.only a basic respon¬ mental in shaping, home owner¬ ship has been made a practical sibility of a free society; it is one possibility for almost every job- which by implication has been written into our laws. The Con¬ holding American. ing of the private In nrosrams indefinitelv exnand nf re- afford "tn ThlOrtl —subsidv housing will be given, priority in an anti-recessionary program such as that of the past year. As you know, the Emergency Housing Act must enter the market starting inflation before something where steps; we simply waiting until the our since that time—and how have eannrt . mulations. a measures ^namntnn fngStinn Ff»d#>ra 11 nanVnrn make such mar- - we £^8^ 2aees fact, more inSO, is mand for funds at the present time different of +hat it -one of the first- things fthat cur-'emerges is the large amount of financing required 'in connection kets, where there is; strong com- with Federal subsidies,: including petition for funds at the present those in the housing field. time. This competition is coming > It is to be expected that some from thn continuing heavv defense riPar those of sources sources. situation a tion What our ft the money we in is direct loan Domestically, our people are de^ manding and getting the goods,and points at the outset. The first is services—both public and private this: The problem of inflation —which enter into a steadily ris-i of 1958 which became effective where in the economy. During a which I want to put before you ing standard of living. Supplying, last April, together with legisla- I'eces&ion you are encouraged to is not confined to the question of these things requires ^continued Hon enacted during the preceding increase your ^forward comimff» short-term price changes. I am heavy expenditures for new plant year,1}considerably increased the ments. But when recovery gains speaking of inflation as a long- and equipment, attractiveness of governprient-in- '-roomeTpum and- the demands -fo<r run trend which, if allowed to i- Internationally, our defense arid sured'mortgages to borrowers arid heavy (inckicling- the persist, would do, untold, damage mutual security needs and the ne- thus greatly expanded the Federal ^ismg^pf^government funds tq ttto the American economy and cessity for large expenditures in National Mortgage ;Association's nance FNMA mortgage purchases) even threaten our economic and the scientific field are primary --— the political freedom. factors keeping the Government's My second point is a corollary financing requirements at a very of the first. While the problem high level. As you know, current The program enacted'.this ?year tho investment marKets. of inflation is long-term, it never¬ budget receipts are not covering-has raised ^estimated budget exSacrificenf Immediate theless requires our immediate current expenditures; not only penditttres:/foi* the Housing and : and most serious attention. This must the Treasury refund the large Home Finanee Agency $1.0 billion ^( easily retrace largely restricted to the relatively small group of families who al¬ ready had substantial cash accu¬ to must contend, v. discussion of this matter, should like to emphasize two tremendous job of mass distribu¬ performed by the mortgage banking industry in recent years. Not so long ago, the old-fashioned single payment mortgage coming up for renewal on certain dates was about the only type of fi¬ nancing available to most home buyers. The result was, of course, that the housing market was subjected our *5? rele- tS'"gS> scrUtiny-^looking into the actual with clear of heavy government de- start start we In my is „ be ^ M . thought that there has been must depreciating dollar,«since the public's prevent such an volved. And when Many of these forces are rently evident in the money the be means careful scrutiny as same analysis of the inflationary forces present time no and must can with which dollar. American I ref i nanced. Wonfarm five preserving — II, and untold millions of older homes have been War a funds investment de-* and by can just as great in nrO0ram£a<? it i* gated to the position .of marginal borrower, its, demands for loan belief that all fu- a business ?heViXmeeto the place to no legitimate purpose," and "inflate the price of homes," and submission of every Federal spending to test of usefulness and necessity in the light of what we can afford. World help to keep into the trap of falling virnnmen^f We compla- us should it vironment of they "serve since from ture new the But defeatism and free market—even though at times Federal Reserve job more difficult. Mr. Baird makes clear that we cannot afford big defense spending and subsidies when our subsidy programs are an important source of Federal deficit. He calls for uncontrolled FHA-VA interest rates, since at ment us a area as Here, I believe we must frankly recognize that, while the Govern- cent. restraints make the nancial proven improvement Act of 1946 in avowing government's for currency's integrity and policy of seeking financ¬ Financing has been provided for 14 million new homes in America relatively ?h°intmonths immediately ahead, t0 rihatiVe /tab""* i« the tained in the Employment ing in it - money concern in the fynds had time and again, for. example, that artificially low interest rates established by law under the VA re- quires an increase in the money supply and, therefore,. In bank commodity prices have stable in recent .credit We have . competitor for private economic growth market. program—and resulting discounts well as in-other forms of —serve rto legitimate purpose and, months and so have consumer credit—a growth that should be in fact,-tend to inflate the price prices generally. Industrial capac- commensurate with gains in our of new houses. Surely it should ity is high and some of it is still-gross national product. It is the be possible, by legislative action, idle. Plentiful crops are putting expansion over and above these to establish a greater flexibility in ample supplies of food on .the growth requirements,- including loan terms -and bring about a market. ; . the necessary requirements of gov- closer responsiveness of the proThese are not factors which sug * ernment, which must be avoided, grams to changes in business and gest that prices will start up • , :money-market conditions. / : 5 again soon. In fact all the signs ' Blames Federal Subsidies Thc need £or been By JULIAN B. BAIRD* Under Secretary are Thursday, November 27, 1958 ... be Inflation While out main attention needs to be centered' on the long-term thermore, terprise economy, excessive speculative Fur- no commitments these competing activity in the period lative . increasingverymuchmorerapidly. lt is a situation, of course, which during the postwar period than ? is particularly characteristic of an has the Federal debt. It may sur- industry such as construction, with prise you to hear that for-every a fairly long cycle from planning dollar of debt expansion by the; to completion. including, mind there has our been the you, such as We or makes breadth, the to resiliency of the market. :- oepve No Leo-itimatP Thus # These of course, »• , * financing will continue to in a free money market, there will be times when Reserve monetary re¬ straint may seem to make our fi- nancing job more ^ is only through, • difficulties, excesses. Federal p„rnno- = present deficit— Our be done v financing of contribution depth, since World War II, we find that * ; We saw this happen in 1954. We other forms of credit have been. are seeing it happen again today. Ff£fovfr5?nent s.ince the end of 1946 activity, witnessed earlier this year, programs rr?a-^ get into^full swing—finan- We are giving thought to the ways emlly; and otherwise—only after in which we can in the future cyclM:al improvement has set in. avoid* a recurrence of such specu- in of loan government involving .forward look at what has been we happening areas the market to get the funds. But difficult. an independent and::courageous Federal Reserve that monetary policy can play its emphasize the fact that proper role as a powerful antiabout $2 in State and local debt,we. should enter into government inflationary instrument. The Fed— $6 in mortgage debt, and $9 in the. programs providing assistance or eraj Reserve and the Treasury, an expansion other debt of individuals and porations. Federal only In of} simply stimulation cor- consequence, debt the accounts for now about one-third outstanding as one-half in 1946. of all against well To use an debt . sectors est caution.;; Moreover, they must t over, even to; particular with equal determination ' a£e of private industry with the great- working in harmony toward the be reviewed .continually as to their suitability (and cost) under changing conditions. Our' FHA - common goal of preservation 8f the purchasing power-oF our currency , ai:_ ^ more meaningful comparison, the".and ;VA mortgage,guarantee and Federal debt actually exceeded the insurance programs, for example, amount of our gross national prodhave made it possible for millions uct 12 years ago, whereas jt rep-}of American families An live more resents less than two-thirds: of the comfortably. But we should make total outmit of, the present time. our economy - I at«; a/greater effort-to see that these -programsr eompete -fah'ly' with^— SS ^^ ^ ^7 ^ ^P^ri^hi &as. possible outthe.cqmmercialbanking. sys^ ?'X^6niinued-on page ^7 ■ Volume 188 Number 5798 The Commercial and Financial Chronicle (2203) ' "it'y j from Washington Ahead By CARLISLE BARGERON Old Jack . Garner 90 was on years old the other day and several old the »/went down to Uvalde,. Texas, to In the of ■> * him. see . • . talk with a Irl. , and Uvalde for for; passage. made where an / since, ever never say- said J; hat mng 1 : : dearlyloved" - He; was of the a very earth solid but virtually he didn't want all for of able described . .. type. He spent his gress, against think his love the Annett Two With as wild Was_runHe become : - Graham the Vice- and whom he know'better, Now With Lee BOSTON, Mass. — James W. Armour, Jr. and Jacob R. Greene cam- Inc., / ./ Higginson BOSTON, Mass.—John A. Hall has 16 Court / / become with connected woolly Jbim Hfcy ■(Special to THe Financial.' Chronicle) Orndoff campaign. ... WORCESTER, Mass. —Bernard has L. joined the staff of Investment Company, First National Bank Building. v ;• the* 3 joins S. Romanoff Co. „ ZANESVILLE, Ohio—Robert K. his Lee Higginson Corporation, 50 Federal Street. thought partner (Special to The Financial Chronicle) With connected King Strdet. was hurt it & a & Company, members Toronto Stock Exchange, Bay Street. Graham, King > . as the Hay Romanoff Romanoff & Street. - - is with now S. Co., 45 Chamberlain - of was Lai asi. an outburst Few people, recall that Garner Presidential The perhaps, of New Issue sought the nomination means velt for c>«>(,. of emotion. as a a of of ex- pression now years Limited and admitted I third ; a admit partner¬ a term. as will to — Chrman G. King has been elected a director of Anhett & Company Stock 2 Proctor TORONTO, Ont., Canada City, York New Jan. on W. By Amtett A Oo. Ltd. 14 , 355 explained candidate. friends should House of which he became minor- he Pairie, York ship. member of the ;» feelings and he sulked throughout any czars and . [lican life: in, "Con- therefore was Waldron salt. radical. Coming from old Repub- man, of the Exchange, * he Roosevelt • v. & New /Special to TheJPinaNcial chronicle) ; , with Roosevelt i doubL he loved Roosevelt. • . later issue of him in the ported to have v ; fng anything about anybody. But Presidential * members of this the Republicans u m a n. Garner is re- - He Street, have he has been Proctor M Vice-Presi- t A;-h got on the-Because Garner silently train X-t/r Wall that he knew the House would not /.. left Pitoo to AAtntt Abbott, 'The depression was on. Overnight Garner put together all of the Jimmy Byrnes as his man Senate, bypassing the Vice- dent, course foolish very vspending bills in the House, amounting to about $50 billion, [into a single bill and offered it in With his term up as \ . Abbott, Proctor $ .. . = President. -friends, including Harry Truman, - /things "he did was "When he was Speaker. William Randolph Hearst began booming him for President. of the News 11 \ Until I9$0 when he be- came Speaker. Y- "One of the few ^ ■ leader •'£' in November 26,1658 1940 heading off Roose¬ third a two term. „V.'; -"7 definitely parted the President's ei- had company over fort to not * pack the Supreme Court. It was that Garner was par¬ ticularly unhdpfiy over the Presi¬ dent's attempt. When the packing plan announced, Garner at the very audacity of it. was laughed •But he - soon realized that a nasty party fight had been provoked. ; As the fight got underway Garner became increasingly 3.20% Serial Bonds un¬ happy. Conservative writers used ■ to from get his opposed was soon that saw nents attitude to it, Garner •/.- Roosevelt's- oppo¬ seeking were Dated December 15, that he and play to 1658 . ■ ... Due " . ' '/■. ' ' ' i . December 15,1659-73, incl* '■ v . b./ *' Principal and semi-annual interest (June 15 and December 15) payable in. New York City at the office of the City Comptroller. Coupon bonds in denomination of $1,0()0, convertible into fiilfy registered bonds in denomination of $1,000 or multiples thereof, but not interchangeable. him against the President. Rather than be a got up of part the he controversy Legal Investment jot Savings Batiks and Life Insurance Companies in the State of New York and for ExecutdrS, Administrators, Guardians and others holding Trust Bunds for Investment under the Laws of the Stdte of New York and left town, returning to Uvalde, something he had seldom during done Congress. ever; When session a of Joe Robinson, who as majority leader of the Senate was leading the fight for Roosevelt, died and his body was taken back to Arkansas 011 a special funeral train with all These Bonds, to be issued for School Construction and Various Municipal Purposes, in the opinion of counsel will constitute legally binding general obligations of the City of New York, all the taxable real property within which will be subject levy of ad valorem taxes to pay the Bonds and interest thereon, without limitation as to rate or amount. valid and to the the of party big wigs aboard, Roosevelt tele¬ graphed Garner at Uvalde to join the train at Little Rock and '■ AMOUNTS, MATURITIES AND YIELDS OR PRICES sec what could be done to pick up the pieces of the Supreme Court fight. When the funeral party started back, Garner called the opposition together and sought to effect a $3,610,000 1959 1.90% 3,610,000 I960 2.20 1,550,000 ; 1965 3.00 3,610,000 1961 2.40 1,550,000 1966 3.10 3,610,000 1962 2.60 1,550,000 1967 3,610,000 1963 2.80 1,550,000 1968 compromise. He called Burton K. Wheeler, the leader of the opposi¬ tion, and said "OK, Burt, put cards on the table. What your sort $1,550,000 , compromise will Wheeler said Garner 1969 @100 1,400,000 1970 @ 1,400,000 1971 @ 99 1,400,000 1^72 @ 1,400,000 1973 @ 98 , 3.15» » @100 99J^ W/i■ (Accrued intereat to be added) 1 :x J , ',1. ' ■ . .. J ' — •; ■ . accept?" you Roosevelt was definitely licked and there nothing to compromise. When $1,400,900 2.90% of . a 1964 was reported The above Bonds are offered when, as and if issued and received by us, and subject to prior sale and approval of legality by Messrs. Wood, King & Dawson, Attorneys, New York, N. Y» to Roosevelt later be asked "Do you want it with the bark on or the off?" bark meant He explained that he whether Roosevelt The Chase Manhattan Bank wanted i the naked truth or did he want it t painted up a little. At Roosevelt's laying he toahted the "truth bluntly, Garner told him he had best forget all about the court and proceed to other business. Chemical Corn Exchange to appear in - Barr Brothers & Co.T" ; Harris Washington j. P. Morgan & Co. R. W. Pressprich & Co. ' trust and Savings Bank Carl M. Loeb, Rhoades Goldman, Sachs & Co. in those that Garner had laid dowfi days, on the President, and that the President kneW it. Garner thought he ought to have a showdown on thejfe re¬ ports with Roosevelt so he went the White House, explained •that the stories were getting embafrfis&ihg and sooner or later Blyth & Co., Inc. The , \ Lazard Freres & Co. The Northern Trust Company Hornblower & Weeks Philadelphia National Bank & Co. Blair & Co. Ledenbtffg, Thalrttann & Co. & Co. Bear, Stearns & Co. Drexel & Co. Equitable Securities Corporation fo^sip columns storieswas a big fed by rommy Corcoran, who shot ,around, here Lehman Brothers Incorporated Roosevelt agreed but soon there began Manufacturers Tfust Company Bank Hemphill, Noyes & Co. y Incorporated The Marine Trust Company SchoeHkopf, Huttort & Pomeroy, Inc. B. J. Van Swiss American Corporation * •( Western New York A. G. Becker & Co. Federation Rank and Trust Company E. F. Huttoii & Gregory & Sons Company ... Wm. E. Pollock & Co., Ific.. Incorporated First Natkftial Bank Rauscher, Pierce & Co., Inc.; Trust Commerce Company ol fruit Company K«m»s CHy, in Dallas The First National Bank Mb. " to -would bring about bad relations Glickenhaus & Lemho GreeA, ElHs St Anderson Haydefi, Miller & Co. The HHnOis • between the tWo of them. that two he Roosevelt Stroud & Company Robinsoir-Humphrey Company, Ific. believed were never the stories. friendly that. Roosevelt began Tncorpbrated ' To his indicated - The after depending ; . . .. City National Bank & Trust Co. Ktnsu CHjr, Me. . , . ' - _ _ . . . • '/'. * - of New Twit texA R. D. White & Company - "•* - Sterling National Bank & Trust Company • , * it Dallas, * - ^ The ef Memphis Mercantile National Bank Company Incorportted - ' amazement Bache & Co. Ingen & Co. Ific. - ■ ' - / - -- - - •. . The Commercial and Financial Chronicle... 12 (2204) As the weeks passed in flood the commercial banking June, 1958. The latest issue was sures. back up to 2.90% after a rise since early 1958 the buildup of "free system with free reserves, - as « in reserves" in the commercial bank¬ 1953 rind 1954, in' order to pro¬ that time. A most interesting development ing system was an important mote business recovery, and that of the past year, particularly in factor in the decline in interest, the banking, system- would ac¬ rates. This buildup made possible tively compete for Government the last several months, is the by the monetary authorities had bonds to maintain earning assets. changed relationship between the the yields on bonds and common reached an apparent target level Likewise, expectation was stocks. During 1958, as the com¬ of $500 million of free reserves strong that the Treasury would mon stock market has risen, in the first half of this year. As carry out all of its deficit financ¬ Standard and Poor's composite the commercial banking system ing through the sale of short-term common stock yield index has used the ready and liberal supply securities to the banking System declined steadily from 4.48% in of reserves to expand loans and in order to promote the business Thus, most observers January to 3.50% on Oct. 10. If investments, the resulting increase recovery. Market Cnnent - and By DR. JAMES J. O'LEARY* Research Life Insurance Association of America ^ : Director of Economic - Life » insurance ~ money industry's . economist, in evaluating recent principal forces shaping market developments, and the prospects, predicts a further rise in interest rates in the near future may, at most, be moderate. Dr. O'Leary outlines basic forces restraining interest rate decline in first half of 1058 and believes one of the most was the shift of institu¬ near-term 4 tional funds from corporate Aaa bond index with the common stock index, in Au¬ gust the average yield on common stocks dropped below the average yield on Aaa corporate bonds. bonds to residential mortgages bond yields. Comments on fascinating factors contributing to interest rate rise; notes Federal Reserve credit tightening policy and Treas¬ ury's need for cash; concludes, however, rates are consider¬ ably higher today than justified by basic economic and capital market conditions, the Administration will be firm about inflation, and the interest rate rise will be self-limiting* yields yield out¬ gyrations past brave a yields on new of¬ ferings of first mortgage electric power bonds rated Aa in quality. The behavior Of these bonds was characteristic of new offerings ment of average it takes man to get out his crystal ball for a look into the generally. On Oct. 22, 1957, the Consolidated Edison Co. of New future. Before start¬ York sold $60 million of Aa-rated honds at an,offering yield of 4.95%, ing, may I de¬ fine some of the terms in and as late as my paper. By "recent devel¬ Power and v opments" I am going to dis¬ at cuss those million James J. O'Leary the past year. By the term "money market" is meant the market for whole, but especially the long - term capital market, including business and industrial financing, residential mortgage fi¬ nancing, state and local govern¬ credit ment as as a well came a as Federal financ¬ ing, and other forms of long-term financing. A Review of Recent Developments First, it will be useful to review briefly the recent developments in the capital markets. Since last Autumn we have gone through one of the most exciting and dra¬ matic periods in our financial his¬ tory., Beginning in mid-Autumn of last year, after a sharp climb in the preceding months, interest rates fell abruptly through early 1958, then moved, irregularly for several weeks at the lower level. Since July they have risen again than similarly rated bonds of offering yield of 4.97%. Then an sudden and precipitate de¬ On Jan. 21 of this year, cline. of Nov. 45 the Dayton kighi, Cq. jssued, $18 three months less later, Pacific Gas & Electric Co. sold a lion issue $75 mil¬ of Aa-rated bonds at a yield of 3.65%, and the following day Iowa Power and Light sold a similarly rated issue of $10 mil¬ lion on a 3.60% yield basis. Thus, . has experienced the most radical changes in the past year. During the high of late last September. Or, to take another example, Moody's index of Baa corporate bond yields rose steadily in 1956 first several months of 1957 bonds fell to 2.65% in late January this year. Since early of has tic City, N. J. based was to the in New York City bank loans to brokers for the carrying of Gov¬ on borrowers and investors also car¬ terest gages here movements rate on mort¬ were and during the past year, but again it is the same story. There the have Treasury policies. ulators both residential and on business mortgages experienced A market. In its pol¬ in the in ease there that b eral Government bond prices must ex- i '' ■■ ~ buildup ,of Treasury also u s the regarding Federal policies, as noted earlier the a continuing gen¬ expectation of spec¬ year, rates the capital ; to and was the price interest \ ■ Reserve mid- convinced became to addition After the expectations move of the of securities, and the drop in yields, was communicated main, the ex¬ reference to Federal Reserve reversed effect in generally throughout those about Federal Reserve a the rates consequent circumstances paucity of published icy and began to interest rate data in the mortgage direction of credit of last field, but it is well known that November is The speculative rise ried the decline further arid faster justified. In pectations I gen¬ securities m a r k e; t the increase in the first half of 1958 of about a billion dollars Autumn, the expectations of economic investors Government expectation that rates would than that were was cumstances, but under conditions of inflation psychology on the part of investors the shift may be very slow in coming. I have- said nothing about in¬ a to expectation prices as erally bid for them. An indication the speculative fervor in the Government stocks con¬ beliefs Con¬ of late common recession bond rise to corporate bonds under normal cir¬ decline n ess resultant drop plant and in and a equip¬ decline early this/ year, with &;'■ peilencq a sustained ^ise^ Fvep1, ment expenditures fey business thdJ Sunimet; V' Jh the occasional inves±orf:vwal.led arid iridustr^. All of these expec¬ mortgage field,' to expect that GoVerriment bond however, the swing in rates has prices were on a one-way street tations operated, along with der been more moderate. mand and supply factors, to proupward. The common belief was This completes a brief review Continued on page 35 that the Federal Reserve would of the movement Of interest rates a "recovery since residential the during the past year ous sectors of the in the vari-, money market. I would like to'turn now to a con¬ sideration of the forces which lay behind This is not an offering of these shares for sale, or an offer to buy, or a solicitation of any of such shares. The offering is made only by the prospectus. an offer to buy, movements. these cession unmistakable. were Of particular importance to the capi¬ tal market, it appeared from vari¬ ous surveys that the heart of the recession was a cutback in plant and equipment expenditures by industry. This im¬ plied,: ,of course,, as decline :ia. cor¬ porate demand for capital funds. The common belief was that ex¬ cess plant Capacity existed in many industries and that under these new circumstances plant and equipment expenditures were business 100,004 Shares bound to ,drop to lower levels. also, commonly and more readily available credit could riot be counted upon as in the past believed . easy this reduction did materialize. The most widely heralded rea¬ for the abrupt decline in November of last year. The sig¬ nal was, of course, the first cut ample, the yield son interet rates was the reversal of offerings an The Tucson Gas, Electric < . Light and Common Stock ($1 Par Value) ■ t i ■' , •' ' 1 : Rights, evidenced by Subscription Warrants, to subscribe for these shares at $49 per share have been issued by the Company to holders of its Common Stock of record November 25, 1958, which rights expire December 15, 1958, as more fully set forth in the Prospectus. \ The several Underwriters have any agreed, subject to certain conditions, to purchase unsubscribed shares and, during and after the subscription period, may offer shares of Common Stock as set forth in the Prospectus. ^ *'*''"f\ ftf>; ts',%0 tint:2 Copies of the prospectus may be obtained from any of the several under¬ writers only in stales in -which such underwriters are qualified to act as dealers in securities and in which the prospectus may legally be distributed. The FirsJ Boston Corporation, Rlyth & Co., Inc. Stone & Webster Securities Dean Witter & Co. Corporation E. F. Hutton & : < ^ . White, Weld & Co. Hemphill, Noyes & Co. J. A. Hogle & Co. Refsnes, Ely, Beck & Co. Company William R. Staats & Co: A. C. Allyn and Company in the rate Federal and Reserve the , nouncement that the Kenneth Ellis & Co. Incorporated First California Company Lester, Ryons & Co. Schwabacher & Co. Incorporated Shuman, Agnew & Co. Crowell, Weedon & Co. Woodward & Zuber Bateman, Eichler & Co. Hill Richards & Co. Walston & Co., Inc. Irving Limdhorg & Co. Wilson, Johnson AHiggins Robert W. Baird & Co., Davis, Skaggs & Co. Elworthy & Co. Incorporated Estahrook & Co. The Milwaukee Company r policy in — Sntro & Co. - mid* discount accompanying an¬ problem of average of 3.59% ~ia October of the authorities was no longer one last year to a low of 0.88% in of combatting inflationary pres¬ on new of Treasury bills dropped from ' ■ to stimulate the demand for new FederaL Reserve one ex¬ ' was that -The movement of short-term in¬ terest rates has been even more Just to take •' and Mpreover, it May it risen dropped sharply to 4.65% at the end of last February, and after some halting spectacular. *An address by Dr. u Leary at the 27th Annual National Conference of the Controllers Institute of America, Atlan¬ bound of the time. conditions the of these Government in¬ and All tributed the great change in the expecta¬ borrowers while tinued. ernments. for call should from sharply and it stood at 3.25% early this month, about the level of a year ago. and most of 1957 to a high of 5.10% at the end of November of last index bonds in in rates, go even higher. Similarly, when the downturn got underway in relationship switch housing. The prevailing view was that .the backlog, of demand for housing had been pretty well The same kind of development filled and that easy credit would took place in the market for state not have the "response it elicited and local government bonds. From in 1953-1955. Accordingly, the re¬ cession was expected to produce a a peak of 3.45% at the end of Au¬ gust, 1957, Moody's index of Aaa- reduced demand for capital funds, rated state and local government and to some degree in early 1958 , the on the early this month, a level slightly higher than a year earlier. the Then both This excessive rise 3.83% by Oct. 10 had moved to 4.13%, nearly the exact point it had year. was occurred of economic was set in which carried the index to After through-June, and then in 3.50% at points below the average Aaa bonds at 4.13%. This Reasons for the Abrupt Decline in early November of last Interest Rates In Late 1957 and January of this year Early 1958 yield on Aa - rated Let us turn first to the reasons electric utility bonds dropped 137 for the abrupt decline in interest basis points! After some recovery rates in late 1957 and early 1958. of yields on new offerings of Aarated electric utility bonds in Feb¬ it is easy to oversimplify the ex¬ planation of this decline—actually ruary, the index reached 4.22% in there were many complex and early March, but then fell back to interrelated reasons.. The basic 8.75% by the end of April. At that reason was the general business point a gradual rise developed which reached an average offering recession which was well under yield of 4.10 by the end of July. way by late Autumn of last year. Then occurred a sharp increase to Actually, the turning point in the business cycle occurred, in July, 4.57 in early October. The Government bond market but by Autumn the signs of re¬ it began a pronounced climb and reached interest between the low of Feb. 21, the index fluc¬ tuated in a narrow range around this level opinion, which tions year and late tiie offering spectacularly. Packed into the the index of the average yield on space of less than one year we long-term Government bonds rose have witnessed a sudden and pro¬ steadily so that by mid-October it nounced drop of interest rates from a peak level last' Autumn to stood at 3.76%. There then took place a sudden drop to 3.20% in a trough in the early Summer of this year and then a new steep early January of this year. Gov¬ ernment bond yields were then rise carrying rates back to the fairly stable through February and level of last Autumn. most of March, until another de¬ Some examples will help to il¬ cline set in which carried the av¬ lustrate these movements. Moody's index of Aaa corporate bond yields, erage yield on long-term Govern¬ ments to 3.07% at the end of April. after a steady rise in 1956-57, 1957, reached a high of 4.14% in late Thus, from mid - October, through the end of April of this September of last year. In midyear, the average yield on long November it began a sharp decline Governments dropped nearly 3,4 of and by Feb. 21 of this year it had 1%. At this point, and abrupt rise fallen to 3.58%, a drop of nearly 94 of 1% in three months. stocks common on the the my important factor of would were 63 basis standing corporate bonds. Perhaps a better indication is the move¬ of most decline convinced that the Treasury not issue any long-term were falling and corporate vestors. To begin with, the rise rising. By Oct. of rates in the third quarter of 10 this movement had gone to 1957 had undoubtedly gone higher the point where the average yield than was justified by the basic the year, The the stock common as in the money supply was a factor in the decline in interest rates. bond yields were and in view of on occurred yields it fell to 4.51% early in August. Since that time it has risen abruptly to 4.94% on Oct. 10. These two examples measured of corporate This recovery movement comparison is made of Moody's a which tended to show the decline in corporate Considering the spectacular de¬ velopments which have been tak¬ ing place in the money market and which are likely to be ahead, Thursday, November 27, 1958 WagenseUer & Durst, Inc. McCormick & Co. November 26,1958. Butcher & Sherrerd Grimm &.Co. Pasadena Corporation 188 Volume Number 5798 . . . The Commercial and Financial Chronicle (2205) vocal ^section of public: opinion stances major, tax concessions use today. He became a> partner vS M°yem^ertt is how pre-J would mean sheer inflation.; ///of ghearson, Hgmmill in 1936 .and a rise in pared to risk :;• I % *? V."By/PAUL E1NZ1G;•; ' and" The British Government is forewarned that it is mistaken in . for causing moderate in- unemployment. revival The t • ^ - . : Government Bonds;, '/'"•• /; of ' ■ s- inflation the * Until recently Official. "policy ' fears caused a; reversal • of the aimed mainly at .the -encourage- recovery in the market for Gov-1 meat. 6t consumer demand* to an eminent securities. Before very; ; extent that: even Opposition, "crit-: long this will represent ohee more I / ics " considered excessive." The ;a major headache for: the :Treas- 1 "spending spree" brought't "about " ury. For this ? reason -,if not• ,'foy : - on the and see* here; if not for any halt to reffationary "policies. . ; through" the tions removal instalment on of restric- other,, the any . "Government isJ I and " bound to call a halt to reflation buying beforri very long. The reduction -i was °f the; Bank rate caused a nalt in j ; quite* out of proportion to the ''denounced by Socialists"who de- / the decline of Government loans. at the creation actual extent of * unemployment. manded that the Government's But taking a long, view, their out- V main reflationary efforts should look is most unpromising, of more em¬ ;The Government's reflationary unemployment to develop at all to aim the consumer financing by banks, violence these of attacks is encouragement of. " measures are denounced as ployment and be directed being towafds, the of agement ,"too late and too little." more consum¬ er through The i LONDON, Eng.-r-As is indicated by the latest reduction of the Bank rate, British official" policy continues of ; Measures .Effect arresting : ; ity. Dr. Einzig measures the probable effect of inflation other reason, source sake: of reversing the crease believing that in political future is made more secure by pursuit of inflationary policies to insure full employment Aan by tolerating moderate unemployment for die sake of price stabil¬ market for government securities the cost of living far the j 13 capital This is iri fact What is purchasing The Sees No Political Gain From done in addition ~ ' r • , now Mafhiy D. Safanie fill. has; been Managing Partner —^ci947./'vVr:'• being to maintaining : the measures official vie w \ ; " - Inflationary, Policies ;; J encouraging coriUnder the pressure of this flood ; surner demand:--: is that unem•?• •• ; ^ ^ .. ^ • -a g • ;p)byment wili .'of criticism the Government ap¬ ;The, Capitad Issites;Cbmmittee >! continue to pears to have forgotten altogether has relaxed its control of private ; c. A tx ^ U-w /« r«4 increase dur¬ that inflation is still basically the Wall York City,' ing the next main danger. Yet even from a few months, purely political point of view a 12 n«unced that Robert C. power. Robert; C. Van Tuyl - encotir- expenditure. Names R.C. /! / ShearSon? Hammill : - & since ;, . Co, are 'member* of the New York, Cana¬ % • . dian,.Midwest,. arid Pacific^ Coast AlHl' Mi' Dr Sflf8RI6:': ' Street, NevJ men^ha*^^ , Sa*din^ite ow^^ expenditure "dans the Gov- /.Conservative Government can ill ; ernmerit is afford to forget this. It is true, and determined to its do to :,Dr. Paul Einzif utmost reverse trend. this Even unemployment is under" 3 % of the working population, much now less than in other industrial coun¬ • an increase mnrp of taker? to Increase ^steel firo- beea unemployment is pliable to divert working class votes to the Labor Party. Ori the other hand, an increase in the cost of living is liable to induce many Conservative middle class people to abstain from voting at elec¬ tion of two commodity ? ex- Ya^Tuyl ^andr^-32 offices coast to coast, and otfices in Montreal and ^witeerlandv as well as ®a'®n'e' will- act: as • Dir^tihR: private wire con-espmidents P»rt.'lcr and-continue to se^e as . cities. ,. . , , r. e?ec- ducing capacity through the 1^/ingl stock: and an-f changes. The firm was founded in ^as been named the firm's, new5 Partner; Muiray,y of n^^Si^W^fsiSa^ . .? and Stock Exchanges, and other: lead- ^airman of the firms Policy large steel rolling plants with Government support Committee. in 12 - Now W. FaublOn & Co. ; rtfingF capaciiy ls .D?t X ta^an^iy 5^ British public opinion has tions. On set up, however, overfull employ¬ balance, the Government ment as a fetish and any Govern¬ stands to lose more votes if its ment that allows/aslight unem¬ policies cause unemployment to ployment to develop is liable to decline at the cost of an increase come in for sharp attacks.'Since in, the cost of -living than if it the reopening of Parliament "the tolerated a moderate amount Of Conservative < * Government has unemployment for/ the / gake;' of been subject to a torrent of abuse ensuring stability of prices. Even by Socialists for having allowed so, such is the pressure of thp tries. used in full. Encouragement is ship in January, 1948. rit «oa Newmmer &trec*t undor tho given to local authorities to build -Mr. Safanie joined Shearsori,' firmi- name of Walter Faubion & more houses and financial facili- Hammill in 1925 after attaining ^ ties have been provided to stimu- prominence as the U. S. Treasury ; " late private building activity: The Department's special' auditor in « .piain , object of the lowering of the XJ. S. Steel - World War I fax Eowafd H. Roselle V: ,the<Bank rate^ tq 4%; was to eiv? case.: ^At Shearson; Hrimmill he ft "*"r " epessedaway. Lcourage production. • established orteJof1Wall Street's ft*'Mr.' Roselle was v The combined effect of all these first investment research departin age oi . • , . , .measures stantial i is bound increase to be in sub- a demand producers, nnd». consumers a stocktbroker^irr New to his retirement, ments and developed many of ;the by techniques of security-analysis in alike. . . York prior; , - - ./The ,: anticipation ' of/.such an : inhas virtually brought to a halt the tendency j that developed during the . spring! and summer, on the part -of business firms to lower their ^prices. : In any case am increase ?ln -dshe /cost - of procrease This is not an i offering of these debentures for sale, or art offer to buy, or a solicitation of an offer to buy any of such debentures. The offering is made only bytheprospectus.' $30,000,080 This is 'not .an offering of these shares for sale,<or ' any ductkm is generally anticipated / ias^aTesultofhigher-wages.«wb$V/ bfr^e:r«yea*sa^b^ ^in: raw! Northern Natural Gas Company offer to buy( or,a$oUcitationvf affoffer to an buy, of such shares. The offering is made only by the' prospectus* 206,446 Shares Cor r material prices. •>* ''•',. Already in somevinstgnces f^^^ ' tail prices have been marked /up*/1 nn "the ground of ^the higher, cost ! fentu^kyLItilitiesGoBapany . of Dated November Due-November 11978" 1,1958 jnaterials.; -rBusiness firms raw w.eret Common Stock. • notin such a great hurir to -(It*-parValui)': . to ihe consumef the ben-r the ^decline, in the raw pass on ^efit^ of Pricelflfl. 32%andaccrue«l4fitere8t the>ehst ' /' v\,' I Copies .of the prospectus may be'dbthinid froM Mny^f tHe^S+iferil wulir' dialers in securities hud in of /raw materials repre- ■J « 'ivritate*^yrtn<.stBfcsrin~4ehich~^ch'r sentsa negligible '/■> total :co*ts. which tH^trosttctusmayirgaHydhe'distribttted.' fractionof their Whenever raW mate¬ - rial-prices rise, their relative proportion-in. total costs: also iinderincrease ; this at miy^ /rate tig /manufacturers .and merchants -claim to ,/be rthe fgoes A/iriysterious : :£ £:' 7 it Glore, Forgan &Co. y t ; / ; : ; Smitlr, Barney & Co. Wefcster Securities Corporation A, G. Becker & Co.: Hemphill, Noyes & Co. A. C. Allyn and Company ; Lehman Brothcrs "*r- ,■ Lyiif^ Pie^ Fenner i Smith Stone & Haniman Ripley icCo. GoHmanvSacks4i Go. Kidder, Peaktedy & Co. 1 V', ' t j, f * *. -' t. '***'1 ^ * subject rocorpocated ^. - -**. Incorporated , .;/=•: - . >. is/'iri^the Budgtary sphere ! thafcHhe' • GoVerhmerif I Is widely T ? eerr^ipuirpv* set-fortkin-'the;FrO^>tettisk;'fc•''* ! " • r > - ;expected:to/make its biggest to iri^absenbed^ares-t^^ttnifgat^ after.therSi^eription'per^y-iTiay^offer , C any 4 '."wf « -Case, Eastman Meriill r v. v "'"C. ■ - .s v. % Si con¬ tribution jto reflation.: ^Drastic cuts ir\ taxation for the sake of stim¬ ulating/ corisumptibn- and reducing unemployment are generally antibipated. / Since, however, the Budget is not presented until April, it is/ quite in the cards that by»that time" unemployment - will /, be well on the decline and prices . Copies of, the prospectus may be obtained front writers any of-the several-under¬ 'only in states in ■which 'Such'underwriters are,qualified to act-as jbe'distributed, dealers in securities and in which the prospectus may legally . Hornbk)wer & Weeks. W. C. Langley & Co. W. E. Hutton & Co. will be well on the increase. In - that Lee Higginson Corporation F. S. Carl M. Loeb, Rhoades & Co. Paine, Webber, Jackson & Curtis Moseley & Co. Salomon Bros. & Hutzler Dean Witter & Co. G. H. Walker & Co. major- tax conces.sions. would greatly, strengthen the prevailing inflationary trend. Politically it. would, appear necessary to reduce taxation to strengthen the Government's ease any chances Clark, Dodge & Co. Alex. Brown & Sons Baker, Weeks & Co. which Dick & Merle-Smith Dominick & Dominick n Haflgarten & Co. at is the General of Schwabacher & Co. Spencer Trask & Co. Stern Brothers & Co. Riter & Co. Swiss American Corporation Tucker, Anthony & R. L. Day Weeden & Co. Incorporated November 26, 1958.- there Merrill Lynch, Pierce, Fenner & Smith Stein Bros. & Boyce Almstedt Brothers W. E. Hutton & Co. - -The Kentucky Company now Berwyn T. Moore & Company, Inc. Security & Bond Company May, fication for tax reductions unless Laurence M. Marks & Co. Hayden, Stone & Co. - Election predicted for the 1959. Economically, however, there would be no justi- end . J. J. B. Hittiard & Son Blyth & Co., Inc. . is corresponding reduc¬ tion in expenditure or unless the Goodbody & Co. O'Neal, Alden & Co., Inc. Babbage & Kessinger a The Bankers Bond Co. F. L. Dupree & Co. trade revival tends to increase the proceeds of the taxes." It is diffi- 4 cult to see any drastic economies in the predictable future. As for the yield from taxes its increase is likely to lag behind an increase in production. In such circum- Russell, Long & Company November 25,1958. W. L. Lyons & Co, * 14 The Commercial and Financial Chronicle (2201) duction The United States and CORTNRY* PHILIP President, Coty, Inc. ! Chairman, U. S. Council, International Chamber Qf Commerce Mr. i Cortney controverts IMF international liquidity recent - • USSR of do not possess a commonly Treat / terpretation ba|ced tates, in con¬ 7* This' system paper dollar' and gives rise onnosition in but also beliefs—" linking wh^ch and monev of- Europeans... , I set* shall forth later, that , covd"agenorfo% :fe goW unless should prefer we risk of '• the at com¬ adoption of the docof the docemployment." A libefal society can assure a high level of employment provided that no, abuse is made of money and of pcredit, that government finances sin oi^ »rid£r shall 'defend views, be-: my the have I cause strong -are run conviction that long if very end is not brought if health and to currencies/- our function to employment stood an inflation restored full Philip C"rtnpv for men with economy and wisdom the price mechanism is freely.- But it is under- as £1d ihfba XX : ^,pplilcia"li!1 versal the order in fVin world. in the put" to the An mucf An r»n^l must end of era expedients which put off until later the solu¬ tion of our monetary illness, ren¬ dered still acute more expedients. return jreely <other, ;irices hot am so that sure they advocate will not have as an end-result both inflation of prices and unemployment. . If to. currencies these by desire we which a are convertible one into the reasonable stability of and free international trade, .k.ll, shall re-establishment of inter¬ an capable, all arc such that some i„j_ the inde- because it is I our am very human freedom which is at stake. Monetary order cannot return to the world without the initiative and cooperation States. The of the. economic country is actions and great^that so even United ^ our our omissions ^ in repercus¬ sions in the rest of the free world. Prerequisites for Gold a of to pendent , upon unions. $28; billion :''; / ; To politics,, and labor clarify the / facts, I Monetary -MonetaryLIuflation Since 1928 System To indicate . h»S'';.i- it ..* banknotes covered to the extent of;about: are —•—-±- "anci_ unii»n\ /<toc i K,r■ the the for banknotes commercial the of a in 1945 special, .. wifh. the free trading Bank,;'into by J V Outlines Several Okstac.es prejudice 2.rd several obstacles in the are against the which goes (ipnrpsqinn sold stand- back fr? +hf iQOQ to the 1929 Tho iohveraMCi * is, Sv o^ Federal Banks T cQtWI against paper Central out nav Banks of the rest call to this in but This - in 22.7 a 17,7 22.0 11130.5 ;'22.q 135.0 t'20.0 136.7 the 1958—October'—-, deValution. 0After Time novv; half be.proper system, ____ 1954- -December; -_i 1957- October — publican Plan. - from deposits) $20 The balance sheet .. of : / the in- 194b in ; war monetary policy of the United ,wasstates can be stated thus: The aftermath of crisis of 1929, withopt theie the Governmept- of -the-United States, evei intoxicated made 177^ u6)1 a seil0u^ of the whole matter know. Professor Charles n»amtained t-at the with its economic power, seized by a sort of monetary megalomania, bathed in the euphoria of money and credit in- ; United Ration, plunged into a is tween I share the will change na¬ my close a connection $ be¬ these two aspects of the problem of the price of gold. / ; Disagrees With IMF Report The Monetary Fund has just published its report on the ques-. tjon Qf international liquidity.Its conclusion n^oveh a post- ^the gold standard. state of affairs the there ri.> '■ *, have billion to $98 billion in 1958. ; r/v1l Re¬ War.' be regarded as time no- demand creased ; II. War W tWorld § Korean AdministratiQn,;'-::-4''y- deposits (of which at least cqn tice monetary of absurd created UU-2 1950- -December a country does not wish; to. drift into totalitarianism) than for reasons of internationaLliquidityr although U02.3 24.4 ^Marshall principle is based on which violates all tne rules basic aold "..&W4-U of +48.6 : 21.0 w! dollars only to the 7°rlc|* J"name it would fran^y ^7 by what w*»ch 7 m a 22.7 1945- -December cur- a thaf such become ' necessary more,.- for tional American reasons (if 33.4 , forced upom us muchthose who deal with- than these matters, believe. ;23.1 18.1 1949- -December.*—— The either longer no *8.2 1939-Junc 1941- -December Therefore be sooner rayments opinip,, 11934-December U 2old Means of 1928—December possession of Banks) these will ,*'T Reserves /^eot f(^jewelers and°dentists Reserve takb to Gold or is that there are no obvious needs justifying change in the price of gold. am afraid that this conclusion reached and publicized to extent cause to please my a I was great country, be- the facts brought out in the report do not warrant such elusion. The present a con- position of the doi^r is weu described there- in and yet the consequences which policyensue from it, and of which I am o n r> f 11 o 1 r> r» tlian the the <auses r confusion fact ave never ied. or that of this in the things due underlying been sufficiently studneces- clarity. The few thinkers who fiave applied themselves to this task, such as the late Professor rary Charles Rist, have been unable to secure for I'J any degree of acceptance their opinions. Others have only supplied superficial diagnoquite unsatisfactory for men :2s, endowed with realistic or critical Ml _V1 - . i in^"the- Dresent* sociraT7t 7 nenhprp and in the face of the Thp n™CSnt 1^*1 ^ " ! of icc,iPH -.nH -k +k t war of the • valbe 0i the dollar and pound after exactly what octhe Second World that Hid L «C°^ had as weu as a price the uie United UU1M2U tities of indusfria were stock-piled. . 7 " — — "" L ^ best • U1 7^/ ST? the best of all possible ity cf-• currencies, .and this at. the a - in worlds" regarding the convertibil- very time I press^m+ IndCurgent ne^a LnVofTh^decadr?^^^ 7"^ urgent neca, and 01 tnp aecqae iyzu thp tn wP v7u War is namely lla.ticiy, oiaws waf in'.umuy rarge inuqs- — ihnnirc prpdit \/yar ",dl> • finL ofCG ft./ ?u js maintainpd fCe+/!— T— tion of lnfla" finanrinp' hv'tho by the renewed -etarv d<Sirftc T/S budgthe prmr^Ll' repeating first whPn ,4^ ^ iain 1 /? \le erfd vfluJ o"'th^redl] conseauenrp mrnP3 World curred economic offensive of Soviet Russia postwar depression explained with the u7 free in linking is, perhaps, still greater Co 5 llsk,.of+mflati°nary pressures and readjustments which the an +vle 3bnor.mal exPansion oiE enedit was ^jted States in relation to the superimposed upon the monetary r^Si ?/ /^f world had become expansion resulting from the fi- the Monetary-Fund pub- UsheS 3 volume11oftf0Ee thfnt ^°^ pages giving .all the regulations qoncerning exchange control ajid, restrictions in all the countries ofthe presumably free world.! — L such that its balance of payments nancing of World War H. This j have grouped together here a had large surpjusesr thus resulting seems to me the mam monetary few of the facts which lead me to. in a sort 01 dollar-shortage, an error committed by the U. S. Gov- believe that the free world haa expression which gained grefJ ef7m?n^ an<? \.s consequences are reached an important monetary wgUC e Second Wprld still being felt, thus confronting turning point and that inexorably tn* 7 5"r country with an inextricable the proce 0f gold will have to be But the^ JS mQJ-\ The F^rfl d^mma Many people still do not chJged and first of all for na-1 Reserve Act which came into understand that monetary abuses „ , d finnai force in 1913, on the eve of the cannot be cured by. credit abuses, y a paper'doffi an/Xr^lrren! 7777777777 - thange in the gold/value ol \ the dollar and of other currencies, that United the* account r pminfrv or |ituatron7in " 25%. law/7 f. efary /id^posite :states wxnild have to dollar 'is .not The dt r35^/r" Federah Reserve" reduced means and banks payments! There . coramer- ; i®^d®-!ij^^ts)^'fi!in^"dep0si'^r' Rist sober of that $28 billion) and cial bank deposits with /Federal/ Reserve Banks (about $18 billion) how. the swelling of of' payment hak grown, in systeijvqhe,United States, I shall mention reDCl'CUSSlons repercussions rest (about . As you Standard gofe a . gold of power monetary matters have national gold standard. Prejudices cmd obstacles faced by the gold standard 11 „ with pendence of mind of which a must also desire the means to —tain them, and these means are ...111. speak we the virtue , nivlnr unnj, .taken place following the althpug'n the present monetary situation/iri pression. ; » ; exclf deU loa^a:7lib"Uuited,Statea;^ The gold coverage whi'clrw.a& att-y' ^lYv..'thorbueh.itudy of the monf sqns^^fo^ which I;am led to:believe sife suffrage, we do not know of any other form of discipline but The third obstacle is to be found that of the gold standard which in the attitude of my country, the will permit ps to,restore monetary United States. On this subject I very the was which means the doltaha. been put on > M at the the on with by modern economists, and furthermore I attend the governing of free men democracies based upon uni- be at. at had for is/npt mifies nothing but inflation; and; In view of the difficulties which Look and -and .40% that allowed remain free to and shall we npt adont.inn in a change in the Federal Reserve Act the United States policy, here is to the reLet us first give a. quick standard lies m-at the Ainencar. monetary trine of "full 'summarize As obstacle the. gold to were would" mention Quick second ol I. totali- a economy fpnpral general ^the mitting the I The p. turn VU '/aia£5Lr!X' generis"' n o w n paper money tude. And yet, even $ which"and credit that took place during States as demand deposits, (theye ; the ahd after the Second World War. are about SI 5 billion of foreign ; convinced, for reasons' am I by , mass^^documents curtains. planned by loans, gifts,~ctc*r Sinc6 the ond / : of certi¬ gree •' 1939 de¬ To the extent that the economic lion have been paid out to the rest j modified, thus.• making3.possible of the world, of which a substan. ( massive inflation'ol money tial amount returned to the United ■ to speak about it any - the> in regulating the Federal Banks were I '• sequence, with collapsed ; cost of living. These are tasks for supermen, .and I am not sure that even they could accomplish them? " mth^im tarmn^ocie^ "sui facts, separated by and k vent the rise in prices and in the a;/?etweenl933^nd,J^5JfceTaws ^the_w?r^proxWM»tefer-$60 btt- nailer f banks' , . far-distance future, to change the cold value of the dollar o Federal the Thus rency. mv number of nrofessors teach- fnc JS!ir ^ minds. If economists are unable to reach an agreement ac¬ the intellectual the '•* : employment and perpetual boom. we revaluation other currencies deplores our monetary megalomania, bathed in the euphoria of money and credit expansion, in extravagant pursuit of fall cepted theory of money. One hesi¬ massive dose of credit and of cur- , compared with resultant free world benefits, and Monetary questions are notoriously complicated and to this day of the nassionate in gain from higher gold, prfce may be- the value of a definite weight of wages and and nsvcholoeical facfors — (3) credit inflation and support of U. S. bonds and high level of activity if incompatible with preventing price inflation. minor equality an tween the value of the dollar and depression of 1929. The evcuts in and .<?■ fivu6 ; Europe aiterthe advent of .Hitler, United states were incompatible ^esulted in a considerable flow of with the professed principles .of country.' The reasons for this can golri towards - jthe United. States, -iiltematiop^l / cwperation ^ it waj K be found, not only in prejudices hiost of which was the^property decided^tomqrnedyt _, gold the to and Insists advantages stipulated Act the 1929 hand and those of; War, one The -onest fori of ings are products, the on in (1) monetary policy has had the elfect of reducing the purchasing power of gold to that of the dollar; (2) gold holdare inadequate apd recourse to technical tricks or manipu¬ lation are fruitless unless there is a catastrophe in Europe; •/ that serv-vter of fact, after the First World the world was on a dollar raw materials and agricultural .standard, helped in, this by the products on the other, " v " 7 * Gold Exchange; Standard/ ;• .ices anticipate its inexorable advent so long as we still are free men. The international businessmen's spokesman contends our: I share the Rist and the length of the finished report's opposition to gold price rise with arguments for prompt upward gold price readjustment (which he distinguishes from devaluation) and return to the gold standard if we are to ? gold. new Charles Thursday, November 27, 1958 came to be asked to undertake depression can be largely '.ex- gold. However, by virtue of its well-nigh impossible as well as plained by this monetary error,' wealth and economic power the contradictory tasks. The Federal which brought about not only a United States was able to obtain Reserve Banks are required togeneral tendency towards lower that the purchasing power of gold maintain the economic activity of prices in the presence of wide-' should conform to the purchasing the country at a.high level by ex-, spread and abnormal indebted- .power of the dollar, instead of pansion; of credit and to support < ness, but also considerable ; dis- v the dollar conforming to the pur- the Government's securities while parities between the prices of chasing power of gold/. As a mat-cat the same time they must pre- depth The Problem oi Gold By of of views ... amcrican tlo(na]^kst? we reasons ■' have the dempr- Volume 188 Number 5798 ; . The Commercial and Financial Chronicle . (2207) f • ^ .Tnehts balance of pay- operate in exchange markets. As are_ matters of great import M; A;Batf2E+ * Y^/ .-The FirstNational BaiA of New YwIi. New York City Formerly Chief of "Foreign ResearchDivision, j/r _ j ; - ^ v -, * f . V * , ■ „ . , v ;K* : ^ ments by foreigners. ac- amounts of lar . ahrd7 I of them the add to dollafvh6fdings.# Sesei^e note and deposit liabili- the dollar could ties.■ On Nov. 12, the U. S. Trea- i •v^n' a $11.5 billion was required- as cover for currency. The actual ratio stood at 43.5%, as compared ^ con- .. yert them Into gbldrather strains come not only «cal affairs. also but from spread flight from the dollar into gold purchased and held by United States residents in various \ • - , , / . . the , Argues Against Complacency Yet, the gold position Of What counts, theie*- fore, is the determination of the United States Government and of the Federal Reserve System to -safeguard economic end monetary stability and thus prevent r— by deeds, and not by words alone—1 the -spread of doubts concerning assured ^n11ar maintenance their to . v ijhited'.States short-term' liabili- icate of financing dollar1^ .. _• a j. .• ..j. . . a equivalent ?-of * the London gold price slightly above the United Miroslav A. Kriz par-^ndzw^t''bdS'-;b^i>Phed}:we/'l6veU'in/mid.'l.^'Octob^ able to :;pasi — $35.1-4—^bnrsubsequentty^^ a^o^ 'mbnetary authorities. ** ' Adds ' f to Staff , < <Spedal to "IThe Financial Ohhonxole) • the United States from the position pf a net buyer of gold In 1956 private buyers, as during of-the. earlier .years, ahd 1957 to that of a net seller in 1958 reflected, basically, a sharp rfeversal in the United States bal- balance Suez crisis in late 1956 and at the form Wgh of the world-wide inflational*y boom in 1957, most of these countries had lost gold; and dollars to the United States; but with the passing of the Suez emergency serves—whether most . . . the largest and-the most produce " Joins Marshall Co* tive economy of the Free World. ' Furthermore,; inflationary pres-r » (special to the financial ohuo^olP), -sures have been, and may well MILWAUKEE, Wis.—Robert -G. remain, weaker in the United 'Morrjs has joined the staff of* States than in most foreign coun- The Marshall Company, 765 North tries. Finally, although the United "Water Street. ^ . , finds its way into the monetary \ . ^ • T T — This announcement is neither an offer to sell nor a solicitation of an offer The offer is made only by the Prospectus. ' > to buy these securities. of United States payments - develop- ' ments-so far this-year and in the ance of payments with the United light of rthe > established policies Kingdom and Continental West- and practices of foreign monetary • ern Europe. At the time of the authorities with regard to tjie the - light of - , the restoration financial of stability, they put an end to excessive imports and capital-flight, This in turn brought about a de- cjine in United exports from the unusually high levels of the second half - of 1957 as well ^as some repatriation of foreign short-term funds. At the same time, United states merdhandise imports Were well maintiined, * and government grants and loans as Well as .private cap-ital outflow continued at high . . : ... 'Not all currently acquired dol- l^rs, however, international gold re- , dollars— * the current gold outflow from the United States appears as a normal ? or part of tlie working of the inter-national monetary mechanism, Most countries other than the * Common Stock (Par value $10 United States maintain the ex- ; ternal value of their currencies by being ready to enter as buyers per shafe ) . States merchan- or- sellers of United States dollars dise levels. their of used to purchase gold from the United States;While no single figure reveals chrrent dollar assets of^^ foreign - countries, enou^i may be were short-tlrm inferred from the Federal Reserve at the lynits of a given range. By' buying gold whenever other coun- ' tries need to .replenish their dol- lar balances in order to intervene Subscription Price $68 per Share in the exchange markets, the ; United States helps preserve the > • inability of -the existing' exchange • fate structure. The United States has thus acquired large amounts of gold duiang the last quarter of a^' ^rG w011^ be no justdxcation for havJn®» J*. Ik p • . the holders of its in the Prospectus. 3:30 P.M., New York Time, December 1958. The Company is offering these shares for subscription by Common Stock, subject to the terms and .conditions set forth , Subscription Warrants expire at , the expiration of the Subscription Warrants, the several Underwriters offer and sell shares of Common Stock pursuant to the terms and conditions 'Prior to * may set forth in the Prospectus. - ^u^!^..fc js go| ln ^ e ihe United States Were not also v ,T ° J.e - J°r * f; " P ^ ^ ' dollar* The interconvertibility of to coL,tte dollar with ^W;1n 1fra«is--i elude that there-has been so. far actions wdh. hippetary authorities no decline in the aggregate- of ]s an+ pssea^a^ ^ 0 Copies of the Prospectus may be obtained in any State only from such of the several Underwriterincluding the undersigned, as may lawfully offer tltese securities in such State. Bank statements-and. various data showing foreign tJeoosits at Afner- • ' - , # . , . such assets. The gold outflow that has occurred •.?An;" address Economics so far cannot there- ! by Mr; -JCriz Round table, of the before the 45th Na¬ tional Foreign Trade Council, New York City; Nov.-19, 1958. iernatipnal^gold bullion standard as it functions - * inevitable. of Loewi & Co. Incorporated, 22$i would nnnenr inevitable. appear Americans as well as foreigners "East Mason ' Street, members of -wenild ^ South Africa and other countries countries used reserves of the United Kingdom : $2.1 billion to purchase gold from instead of being sold—for dollars the U. S. Treasury. The shift of -«-to .foreign central banks and foreign In- :- Although are, of course, aware of the large the New York and Midwest Stock real resources and high produc- .Exchanges. " J r tivity of the American economy, - transactions with foreign $2.7 billion. Of this -i the}idea . '\ MILWAUKEE, Wis.—Barry XL rise in the dollar price of gold /Hinte has been added to the staff . are countries of ' r , to purchase geld from the ounce). "Ti»ifbd g+q+^c - tko romnitiirid dunce). United States. The "remaining $8.4 highest 'piiii0n represented j holdings of deplined .Sdch holdings are not legally con-, and stood^ov.18 at about$35.t0. vertibie into gold, the United reasons for ebneern over"- the dol- The .rise 4n .hthe iiOndon price has vstates has for almost a quarter of lar* >• i. made -it, .of ; course, cheaper _for the century followed the practice ; Central^ banks-to buy gold in New if'Converting them into gold; a iBalanee -of Payment Reversal York. The.Londen gold price nse ^^ pa^ pf these holdings eonDuring the first nine months of in turn reflects, the fact that much s|sto t)f course, of working balthis year, the United States had a of the gold coming-into the Lonances to meet current of-prospecdeficit in its -commercial and fi- ^on market rfromJ the Union of tive pkyment requirements or to v--.'better judgment about whether there amount, world ' tractual obligations to Americans; .gained ground that conditions rifsuch private fefiMWa rannnl ihA wprAdevelnninff under Which a holdings cannot be were developing under which a _ ^Treasury's selling price of ;used: niancial ^ the dollai* old - Customers* of , date for which figures are avail- y*r outflow front States the United .States -and its signifi- gold'1-- ($3b.9875 per- fine* i1fi-r gold ("$35.€875 per fine* cahce. Once We have clearly in Jhis price - reached its be The Association a ^....wMch mjAugust 1958. the latest ■ _i all^/reyiew^if briefly the current g f,iBBBM%1B nnw*1 T T nnfJn„ .^puaou problems Anitllfll XdliS^iriV • . Brokers will hold their annual -to vfdreign countries'^en -of- peace-time record budgetary def-*; ficial as well as private account, icit and U. S. Govermnent bonds Christmas party on Dec. 3 pit ^ sH - the * nofdih' gs; and of price of gold.' the ' thantqaddtq^ shall financial Foreign bankers* *andstresses. ar.e in disfavor; and there, is White's Rtestaurant; Tariff includemerging a new wage-price push .ing dinner and gratuities -is *$7. ;An important reasw .of a^tech-?j<able,^amounted" to. $14.2 billion, . that may well nullify expected Reservations may be made with nicaljnatuiy for ^e large,United Qf j this /amount, however, $5.8 increases in labor productivity A^^Frank, Ladenburg, Thalmami 'sales s-to j Coirtme]^tal^billioii^^ ^was held by commercial and, r among other things, price C6%' ^ ^ r. 4 "■ -,i wmriim ilSuimpiian ^imirips1 was : .. - r , anyj-l J ..... diumg™ 1958—to the i foreigners with 47.4% in mid-February, be- centers, abroad. ,r , from amounted to Americans. Today, however, there this amount, are no indications of any wide- 5 f??'! V K . v a aSs^ bnt^Canade,..Germany, currency stanrds ai~about'$8.5 Itil- in America itself;, "the Treasury Nqth^lands,;and iother Coun- Hon. It is therefore less than the has to deal with difficult and del- tries i continued : n.d. _esp e-_ cially economic, and ,k . chosen at times r~a in- large dollars some an ternational creditor; our investments abroad exceed by $36 billion .the foreign investments in this K1® '?5% legal cover for Federal • countries quired long-term account it is on possibility of a run on the dollar businessmen and.investors are-ras ias qn any Other ^ufrrehcy.. Even understandably"— watching how more important, the pressures on we handle our (monetary and fis- 4 v, — ,To. be. sure,, there is always <Oar Gold Coverage of foreign fore be regardedas havmgbeen fore^the gold. outflow from the during most of the past. caused by a massive conversion of >Uhitfed States beg&n. Despite its decade fell short of their dollar foreign-held dollars Into gold, decline, the gold reserve thus exreceipts. As a " " * ~ 1 J - • — countries ing its banking claims of them^ «aa«53as ■» fisafrtsa ess. well ^i^Pmestically, gold is beld. by recent favorable price for gold in the London maiket ovfticii prompted central banks to buy thefr gold here, tie does not dismiss the possibility of am oh Ik dollar, hs onany other currency, nor regard our gold position with complacency. Adds, however/ that pur resources and productivity are recognized, that inflationary pressures are .Sirenkmr here than abroad, and that we are international creator nation on long term account. Uoilar expenditures as : - our ' ^ international debtor ^ J^,!8 mestic ^^responsibilities. balance of tradcreverwrt, «ud not frsm ntasffre roni version of foreign-held Mtrs, end to opportunity prt&culcd ; an short-term account—its liabil- on ities to foreigners greatly exceed-» . vent dolibfs coQcernhi£ tiifc priceof gold.^ Dr. Kriz attributes gold outflow to gold pur¬ chasedby foreigners with currently earned dollars it suiting from States is 1 have already noted, gold bought this yeaT-by foreign countries as f•^S? *22 -whole has-beerr purchased with h/abroad^ over ttie be Currently acquired dollars, not by *3Sr d?a existing snort-term Sx S assets. wh^^iiS1^'IP?: For*ign entries are also hold,, today/ Yet,- the * rnagintude and the ; speed of Ihie current gold outflow' are reminding us once again that the trends and developments in- LEHMAN BROTHERS November 26,1958. ^ SMITH, BARNEY &fOO. 16 The Commercial and Financial Chronicle (2208) ... Thursday, November 27, 1958 and the company appears on the brink of improving fortunes. THE MARKET... AND YOU A Atlantic J ~ r Refining was an¬ other oil in mild demand on By WALLACE STREETE NSTA ^ Notes the prospect of far better re¬ sults next year than this, a The long-overdue correc¬ for the year in this quarter dividend that is well covered tion in the stock market came were many and varied. A few by even this year's depressed with a thud this week when dour dividend actions, how¬ earnings and a yield of industrials were given a one- ever, continued to weigh on day trouncing that was sharp¬ specific situations even where er than anything seen in three prospects for improving busi¬ years. "L% t; '•? v' ness were good. In fact, if it hadn't been for break of nearly 32 points in late September, 1955, at the a time of the President's heart attack, which in turn was the sharpest one-day setback since 1929, the comparison would more have stretched back than three years. The inevitable around for. a reason fishing centered pretty much on what appears to be a topping out of steel with the auto overly promi¬ nent as buyers, plus Adminis¬ tration intentions of tighten¬ ing up the Federal budget. But the selling had already production, makers still not before started nouncements sharp drop a final session were these an¬ made and last week's built up a good on load of weekend orders aimed at ' Bearish Technical Factors around better 4.7% which is than return a too badly Ashland Oil..is t h a n o to run counter to the : Bernard J. Conlon * since they well so setback market . chilled Saivatore J. Rappa First . Vice-President—Barney Nieman, Carl Marks & Co., Inc. Second Vice-President.—John S. Barker, Lee Higginson Cor¬ poration. wise, by the recession. And Big Three in this section for In the several days of sell¬ they are still among the a long time which left little ing more than two dozen to be corrected. higher-yielding items around. Southern Railway and Santa points were trimmed from the An Upstanding Electronic record high standing of the Fe both offer returns well of electronics the the mini¬ the into neither 5% has bracket been Secretary—Saivatore J. Rappa, F. S. Moseley & Co. Treasurer—Wilbur Krisam, John C. Legg & Company. Directors (Two-Year Term)—William J. McGovern, Blvth & Co., Inc.; Frank J. Orlando, Goodbody & Co.; Elbridge A. Smith, Stryker & Brown; Bernard Weissman, Gold, Weissman & Co. Trustees of Gratuity Fund (Two-Year Term)— Vincent M. Gowan, Goldman, Sachs & Co.; Charles M. Kaiser, Grady, Berwald and unduly af¬ were able to shrug off the general selling easily, notably tion so a nerv¬ Siegler which bolstered the ous affair. fast shrinking list of new highs posted this week. As Institutions Sitting Pat was pointed out in these pages Sketchy statistics so far last week, the company has available, and the opinions of done a rapid shift in only four brokers generally, support the years to join the ranks of the contention that up to here, important electronics outfits anyway, the selling has been with both rapidly increasing mostly from the public with sales and profits and still last year. has held about in last year's range while Southern has only nudged out of last year's range on the topside recently. the front of the groups that bore mum even of a full trading is still range correc¬ institutional; and invest¬ available at a modest priceinvestors sit¬ earnings ratio against the ting pat or shopping for bar¬ other more popular items in gains on sharp selling. There the group. was some talk of foreign Oils continue laggard ex¬ liquidation, balanced off by cept for Richfield which was buying in special situations, able to rush to a couple of so that these rumors were in¬ new highs right through the conclusive. selling deluge. But since the Hails were less pressed than items in this group had been, the industrials; mostly be¬ neglected for so long, they, cause they didn't have the weren't overly conspicuous many excesses that the indus¬ under pressure even when trials did. And Pennsylvania selling was general. Socony Railroad Was able to make Mobil, for one, was being uphill progress right through looked at far more kindly by the selling to provide a bright several markets students since spot in the group. it was able to hold up its sales ment , company Utilities downhill with were carried well although the company the general isn't expected to maintain this" selling, a pronounced bit of year the 50-cents~ extra paid easiness in Consolidated Edi¬ last year. The cost-pinch, son following announcement however, hasn't put the $2 of a $60 million convertible regular rate in any jeopardy debenture offering. while the price has declined Apart from new easiness in about a dozen and a half the price of copper, the busi¬ points from last year's peak ness background wasn't un¬ . favorable and predictions operations reaching a of to go a long way peak counting the bad toward dis¬ news ahead, fected by the business down¬ turn, their results comparing & Co. very favorably with Santa Fe, pricewise, National Committeemen— Samuel F. Col well, W. E. Hutton & Co.; Stanley L. Roggenburg, Roggenburg & Co.; Alfred F. Tisch, Fitzgerald & Co. were Alternates—Stanley E. Dawson-Smith, Cruttenden, Podesta & Co.; Joseph R. Dorsey, Bache & Co.; Thomas Greenberg, C. E. Unterberg, Towbin & Co.; Robert M. Topol, Greene & Company; Stanley M. Waldron, Merrill Lynch, Pierce, Fenner & Smith. . but there Nominating Committee (Four Members to Be Elected)—Leslie Barbier, G. A. Saxton & Co., Jnc.; Henry G. Bruns, T. L. Watson in the fore¬ the brunt of the recent & Co.; John Butler, The First Boston Corporation; Thomas L. Curry, Stone & Webster Securities Corporation; Edward A. Horn, selling ] Kuhn, items in this were group that hadn't participated in the bull swing and had : little to correct. Olin Mathie- chilled by dividend cut earlier in the year, has been virtually stagnant but, on the other hand, has not had the son, a » National Committeemen The Chemicals Hit Chemicals Wilbur Krisam President—Bernard J. Conlon, P. E. Fox & Co., Inc. week. Some John S. Barker • protecting profits. And trend most of the time. Ex¬ this game a bit and attention these hit, the list col¬ was mostly concentrated on cept for the low-priced items, the Western roads that have lapsed rather easily with the there hasn't been any enthu¬ selling carrying on into the siasm on a broad scale for the been little affected, profit- This, however, Barney Nieman ' fad has been to favor the Eastern roads the A once senior average. is still short of The fol¬ r e r depressed that by the selling and American Motors, after de¬ they were logically the can¬ didates for dynamic recovery claring a stock dividend and as the recession waned. But reporting good earnings, was able Friday, Dec; 5 at the Bankers Club. demand has centered. were affected on lowing slate has been nominated for 1959: available in issues where all the recent, recent weren't Motors The Security Traders Association of New York will hold their annual election far -Technical aspects weren't high-yielding item in. the oils, its yield running: a round overly depressing although 5J/i% and its regular dividend still favoring the bears. Trad¬ is also believed to be well ing expanded on selling, in¬ covered despite a decline in cluding the appearance of profits-this year. The com¬ 1,287 issues cn one day of pany is noted for turning in pressure which was the sec¬ ond broadest list in history good profit results even in and only three shy of the trying years and, with the upturn in oil, business and the record 1,290 issues that ap¬ general economy continuing peared early in 1955 as one into next year, improvement day's work. Late tickers were in results shown by Ashland numerous even within a sin¬ in the September quarter gle session and mostly when could gain momentum. selling showed up to depress Among the rail fanciers the the list or to kill off any fee¬ ble rallies. SECURITY TRADERS ASSOCIATION OF NEW YORK & Co.; Sidney Jacobs, Sidney Jacobs & Smith; John J. ner Meyers, Jr., Gordon Graves & Co.; Daniel thai & • Co.; Homer Wirth, Mabon & Co. The Polls meeting will will be convene from 4 to 5:30 open at 5:15 p.m: p.m. ing cocktail party wilhbe held. a A*'-A.. then before the bad news was Hewitt of First California ' earnings are defi¬ going to- make poor ; since large, * non-recurring start-up . point to a rebound in piled on was r profits next year •' • improving steadily. [The article time In views do not coincide expressed in necessarily at with those addition as Presi- was named to the Secretary-' *"' T 5v "J ?1] - officers;, the followpig elected directors of the association:- Wil- liam Belknap, virtually assured V top of operations that Company association, for .the'next 'year.? Howard,. Jr., of J. S.'Strauss & Co. ? named Vice-President; and Robert F.: were year. the • J. Treasurer of the association... ..v., * It does, however, are of Loberg, J. Barth & Co., being charged off this SECURITY TRADERS ASSOCIATION . Leslie ex¬ penses are SAN FRANCISCO dent official. Its year and the annual At the conclusion of the meet¬ . The San Francisco Security Traders Association at its annual meeting elected Albert A. nitely James Mullin, Tucker, Anthony & R. L. Day; "Hank" Serlen, Joseph- sinking spells it did when its previous dividend was in jeopardy nor, for that matter, ; approached the low it posted J. reading this Co.; Kelly, Kidder, Peabody & Co.; T. Frank Mackessy, Abr bott, Proctor & Paine; John M. Mayer, Merrill Lynch, Pierce, Fen¬ G. - Loeb Francis - William R. Staats & Co.; Donald \ Agnew of Stone & Youngberg; Frank Notti,, Schwabacher of & Co., and Richard A. Hennig Brush, Slocumb & Co., Inc. Hewitt ; BALTIMORE SECURITY TRADERS ASSOCIATION this The Baltimore any of the "ChronicleThey are presented as those of the author only.] Security Traders Association will hold their 24th annual dinner on Friday, Jan. 16, 1959 at the Southern Hotel. , Harry J. Niemeyer, Robert Garrett &. Sons,-is Chairman of the . entertainment committee. . N- : Number 5798 188 Volume . income investments and trades on 15, the The Danger ef Inflation And a Program to Combat Board Governor M. S. Are It until forts in World War War and tinuous II, the Korean the necessity for con¬ expenditures to defend This constant spend¬ nation. our minimum small will counteract Yet the feels little or these problems average generation ago. As a result of this false prosperity, we as a nation have developed a habit of na¬ tional extravagance far and be¬ yond our wildest dreams. long as he enjoys prosperity, and he usually says, "It is up to the Certainly visionary all people recognize the inflationary dangers involved and can the possibil¬ see ity of ultimate economic chaos. Communist The : their low standards single-minded ambitions to over¬ the capitalistic world, are of Because crises so Politics all of the recent in more be could Democratic form of gov¬ •• usually blamed for ills. Actually we fre¬ are our quently get the type of politicians we deserve and much of the legis¬ lation world and the many years we demand. Many of our devoted public servants and are trying to do a constructive job for an altogether too apathetic constituency. Congressmen Cites are Substantiating Congressman Views American for for one Today, 450 or exchanged dollar. French francs are exchanged American one dollar, and all Leon and varied programs—from agriculture to minerals, and we are creating a Utopia where no one can lose. The government will many of us know the hundreds of mil¬ protect and finance all phases of we demand the right to lions of dollars that we have our economic and social life. We criticize, except in times of war, loaned or given France to help may go bankrupt and create yet we feel our responsibilities to stabilize her economy, each time a chaos; however, these programs our government are discharged crisis has arisen. The same situa¬ must go on. Certainly we did not primarily through taxation. Every¬ tion applies in varying degrees to build our country on subsidy pro¬ one criticizes the government re¬ Italy and many other countries in grams. America was built by hard gardless of administration, but Europe and Asia and to almost all work, thrift and frugality. Unless very rarely does anyone offer to the countries of South America. we change the trend, I am quite help solve the problems. German currency has twice be¬ certain we will end up with a For many years large segments government * over¬ come worthless during our life¬ bureaucratic of the population have been de¬ time, but in each case we have lording all phases of our eco¬ manding more and more from our been able to help her start over. nomic and industrial life." central government in Washing¬ German economy is now mak¬ ton. Our strongly organized labor Congressman Clarence Cannon, ing apparent sound progress— Chairman of the House Appro¬ higher demanded have irrespective of productiv¬ ity, and our large corporations in turn have raised product prices, wages, Publi¬ the folly of the notion cation of September and October can be any such thing has had excellent articles by pro¬ as 'permanent inflation' is to let found thinkers, including. Dr: Ed¬ a little inflation snowball into a big one that must in time collapse with consequences heavy in hu¬ man hardship. "The more sensible way is . . to pursue a course that will make sound, stable dollar, and thus expectations of inflation by ' demonstrating they are groundless." Senator Byrd has for years de¬ manded economy and fiscal san¬ win C. Nourse and Dr. B. Sherman Adams, pointing inflation. of with memories of its bitter expe¬ rience. priations man Committee, Wilbur D. Mills, the House Ways Praises England's Efforts point where the purchasing power of our dollar has been re¬ duced to less than one-half of its a astate our it, economy unless we as take we now steps promptly to reverse and check this trend. Congress¬ Chairman of and Means Com¬ England is the one major nation that has not permitted long our any economy? nation ruining without Do you made efforts greater raised Williams of has Maryland conr trated efforts leaders in the Unless the economy of argued the has had to good share whole. This object lesson will reduced approximately two billion in exports are less the last year, our Our na¬ tional debt of more than $280 bil¬ and lion our imports more. is coming due about $75 billion time more of us 3 this serious gave problem.t .People living t. at the rate of on year. per It's thought to ,.t rjty, modest pensions, small fixed income, workers who receive address by Mr. -Miller before the National-Afairs C"*-mittee, City Club of "An ' Chicago, burden country should for serve These are but a few of the men suffer applies even ernment bonds, savings banks, in¬ surance or any other form of in¬ into a vestment. majority if we take time to do NOW—what can be done about something towards making it so. this perplexing problem?; Certainly all of us, and all other After much thought, many dis¬ enlightened people want to do correspondence with something to help those in Con¬ cussions, and ap¬ gress that are making efforts in public officials, elected pointed, I would like to offer the the right direction. * tionary madness in recent years. This minority can be made should be presented. clubs Civic are Offers Anti-Inflation Program composed of First and foremost, and perhaps highly intelligent patriotic citi¬ one of the most difficult steps, zens, Interested in the broad non¬ but not an impossible one,—the partisan problems of our com¬ economy and fiscal policy of the munity and country, and I have country must be put on a non¬ every confidence that other likepartisan business basis. Our for¬ minded organizations and people eign policy has operated in that will lend their efforts and cooper¬ occasions in re¬ Surely the inflation danger we are confronted with is tive steps — arrange committees equally deserving of such con¬ to work with other groups such as sideration. > the Bar Association, Kiwanis clubs We must have a solemn pledge and many other community and from the leadership of both politi¬ civic organizations for the purpose cal parties that the economy of of acquainting the people with the country will be put on a busi¬ the problem of inflation—and ask ness-basis and operated as such people through the press and hereafter. radio to write their Congressmen A second step, closely tied to and Senators about it — combine the first,—would be for the lead¬ with and encourage other institu¬ ership of each political party in tions such as banks, insurance Congress to select two qualified companies, pension funds, labor representatives each from the unions and the public generally to Senate and House, making a total demand a fiscal policy that will of eight members. These men, to¬ give us hope for greater economic gether with the Secretary of the stability in the future. This is a Treasury or Director of the Budg¬ very brief outline and obviously et, as the President directs, can will have to be expanded upon. be regarded as the .Watchdog we must develop a reversal of Committee for Expenditures. This the defeatist thinking that now Committee would carefully review ation. manner cent Civic clubs Not a can take on many years. construc¬ Continued matter of record only. New Issue 70,000 Shares as as for R. J. Reynolds Tobacco Company a New Class B Common Stock an United the Chicago, 111-, Oct. 28, In ($10 Par Value) and spite of her many problems lack of many natural re¬ England has maintained relatively stable economy. Shall we try to follow in her footsteps or shall we go merrily along until we reach a condition comparable sources, a 1958. Price $86 per Share to France? In other this country the press and publications are constantly telling the public bow to Social Secu- our proportionately.! This more to the aver¬ person of small means, in both houses of Congress that age whether their savings is in gov¬ recognize the danger of our infla¬ lower taxes. States. Our gold reserves were by the the of have world? of less — to element of the population every us helped many other nations of the f export, rate times at help shore up our economy as we . Federal country as a whole has stability, our personal economic security spending is the only way to get sistently minimum, to Bank Central the (the highest ever years), and main¬ tained very high general and in¬ heritance taxes. In a few words, 7% know would that to continue we can Claus Santa be duced imports to a bare known in recent How state on the part of all finance, busmess, labor, press and opinion molders generally to fight hard until this problem is solved. We will have to stop thinking in terms of busi¬ ness as usual, partisan politics or ity., Senator Saltonstall has intro¬ whether our personal interest is duced an excellent resolution that will be referred to later. Senator favorably affected. a overcome ** know dangers articles the problem and what the future will be unless there i« concen¬ mittee, Congressman Keith Thom¬ son of Wyoming, and Congress¬ inflation to man John Byrnes of Wisconsin, all ruin its economy in spite of its spoke forthrightly in opposing the inability to grow enough food to vast expenditures that were being former value within the last 20 feed itself and despite its need voted by our last Congress. years. to import many other vital ma¬ Excerpts of many statements by Adding to this problem have terials. Their economy also suf¬ these men appear in the First Na¬ been the demands of veterans' fered greatly from war and other tional City Bank of New York Oc¬ organizations, agriculture and problems. We should briefly men¬ tober Monthly "Bulletin." The tion that England undertook to exists among many people, includ¬ other subsidies, without mention same "Bulletin" also contains the solve this difficult problem for it¬ following statement made Sept. ing those who have an under¬ of the many billions that foreign self. True, we have given England considerable help, but the English aid has cost us. This type of prosperity tends to people have made special efforts to keep the cost of living down, create an increasing inflationary All of these Shares having been sold, this advertisement appears as a which in turn has kept wages at condition that could, in time, dev¬ a relative level. * England has re¬ all of which has raised living costs to the up These . ernment unions hardest, most tragic way standing of the problem but are waiting for leadership to push it in the right direction. The "Mortgage Banker," Gavin of general level of prosperity en¬ Pennsylvania, for example, following as the basis for a pro¬ joyed by the American people, warned in the closing days of the Calls on Civic Clubs gram which I believe can be they have become apathetic to the last session of Congress: latent dangers of our economy— achieved, providing we can fire I am certain that civic-minded ". the government today is the an appalling situation. imagination and energy of becoming a government of pres¬ clubs would want to discuss this those who understand and are In 2918, after four years of sure groups—in fact, a govern¬ vital problem, and I felt that this concerned: World War I, five French francs ment of subsidies. We subsidize is one of the first places where it hoping and waiting rather impa¬ tiently for this to happen. our no '•>< concern. . nations, with of living and dangerous trend, ultimately ruin our government." take In person for this country even though it is still the number one nation of the world. ing has created an inflated econ¬ omy that was unthinkable a concern matter degree and will cer¬ which would others of pinched affected. be a tainly be the end result unless we develop some concrete plans to by the reduced buying power of today's dollar, and as time goes on, more and more of the popula¬ tion is Reserve Szymczak: prove for feel this one of time and - feeling are for "The Federal by that there . I know that I am not alone in my and wages, means currency impossible? or I inflation jeopardizes our economy. has been affected by our ef¬ 25 Does this prospect seem fantas¬ tic of tax revenue into debt retirement, and a public relations educational campaign to awake Americans For the past 20 years our econ¬ omy only a inflation? percent siphoning to how of value a perhaps 1958, dol¬ to that has gone through the bitter experience of being neither radical nor extreme. Mr. Miller proposes placing our economy and fiscal policy on a non-partisan business basis, creating a Watchdog Committee for Expenditures, enactment of Saltonstall Resolution requiring a minimum of even vast has and other or Gravely concerned about the dollar's down-hill slide, Chicago which he describes as .one our few years later down to the value of French banker submits anti-inflation program - going to permit we it cents, Illinois National Bank and Trust Company of Chicago, Chicago, 111. - will dollar our lar to continue its down-hill slide Second Vice-President, Continental . of what fear buy when it is ultimately repaid. By DONALD C. MILLER* ; 17 (2209) The Commercial and Financial Chronicle .. inflation—what sell—what to to "beat" buv—what hold—all to adds fuel to the fires of inflation and discourages Clark, Dodge & Co. of which investments in long-term bonds and other fixed November 25, 1958 Alex. Brown & Sons on page 28 18 The Commercial and Financial Chronicle (2210) commercial of America, New York City detailed banking expert submits a international in overseas would . (a) administrative in leading all com¬ mercial and industrial nations ex¬ cept the United States today en¬ joy the advantages of compre¬ hensive . voice, depending ex- and - If at (b) to Fund" risks their would foreign sales. The for re¬ cent initiative be authorized specific the one is im- trancis ure to and entitled Federal enabling buyer's fail¬ his national cur¬ rency, but more importantly in the hazard that blockage of payment result may from temporary unpredictable dollar exchange political risks re¬ inherent sales. overseas " in places ternational business vantage with countries American at where in¬ disad¬ a exporters in other there already exist well-organized, soundly op¬ erated export credit inability of existing Government agencies to S. of large segment industries and the unfounded feeling in some export our past government circles was that dip¬ friction with lomatic other guarantee systems covering both commercial political and exchange credit and risks. exporters are con¬ fronted by the fact that in many cases credit terms are becoming more increasingly important in effecting sales abroad. Risks in¬ crease terms become as tended. Frequently more the ex¬ supplier cannot reasonably assume the en¬ tire risk, and the commercial banker, term even funds financing, when he has longer available for export cannot always pru¬ dently relieve the exporter of the inherent political and exchange risks. Ill the should national interest there be promptly established (with limited government assist¬ on a business basis) a pri¬ vately owned and operated system of comprehensive export credit, exchange, and political risk guar¬ ance, antees. provide the assistance type of guarantee required by our gen¬ eral commercial exports. There is an ' urgent demand, a need, and an opportunity for a greater selfsupporting system of private in¬ ternational financing. panded demand without use can of U. S. This be ex¬ satisfied Government funds. Our existing private inter¬ national banking and financing organizations can do the whole job, provided the auxiliary miss¬ ing link—one or more Export Credit Guarantee Corporationsis set up (with private capital) to other . the from from One the corporation's reserve for political' and exchange risk coverage will accumulate to the point .where it has be¬ American for manufactures and Regarding the fears of friction arising from direct U. S. Govern¬ ment operations in this guarantee field, the solution lies in the cre¬ ation of Export Credit Guarantee Corporation (s), operated on a private enterprise basis, entirely independent of U. S. Government ownership or management. Actu¬ ally such diplomatic friction has not resulted from the operation of comprehensive guarantee systems by other trading nations. Submit A New Detailed Plan for Federal law should be to of enacted to special Federal charter privately organized and owned a Guarantee Corporations. This charter might give the Guarantee Corporation the exclusive privi¬ lege of obtaining in effect rein¬ surance or in the form of "disaster" "catastrophe" United loans from the States Treasury (or its designated agency) under; certain well defined circumstances. ever, solely How¬ such legislation should deal and change The exclusively with coverage of non-commercial claims ; arising political and ex- the risks, i.e., -only "political and exchange risks," leaving the matter of , "ow Would term least pru¬ ' : commercial some favorably longer- more additional financing when: the export risk factors are insured. : . (4) More private capital would be attracted to the foreign financ¬ ing field ofice the unpredictable political and presently commer¬ cially uninsurable risks are sub¬ stantially removed.: V available such Export Credit Corporation(s) would be many—the State Department's diplomatic and consular services, to Guarantee S.. Government U. lending would be entitled to commitment a rea- fee for "standing by" to make loans up to predetermined maximum amount to cover claims arising from political and exchange risk factors in each country. These "country limits" would be deter-: mined by the corporation's management with the cooperation ahd the of responsible agency poration. government Federal the to * ' . „ cor- . . of and from cial In all in order to exports arising assure from sidered credit as assessed or con- part of the commercial risk in connection with the export or an agreement the for export of goods. Guaranty contracts should be assignable to . banks or in certain circumstances issued directly to banks to facilitate financing. , stitute generally.. eventually at It is estimated least American five to that there six thousand manufacturers porters who to and customers .abroad, growing.,. As competition mounts, each 'supplier finds it increasingly necessary to grant payment terms to maintain to extend facilities (e) All guaranty ' contracts would and for concentrating that in¬ in would cause would the . inevitable deepens, those that, more available as this trend will be and an credit within use such more se¬ become be¬ Corporation its view a to credit their foreign competitors, — .. M B* **rovi«Md Are Self-Evident: No " direct "cure-all" can be ex¬ and Political Risk Control The privately owned and oper¬ ated corporation would make ex¬ change transfer and political risk available: fi- comparable exporters to It is Exchange guarantees (1) Under simple business pro¬ cedures and without the its U. S. imposing Government agencies assumption this ) a foreign nation was un¬ dertaking. Manipulation of pre¬ mium rates, percentages insured, and ceiling limits by countries would provide built-in controls against runaway credit extension. The Export Credit Guarantee Corporation could, therefore, be a great - stabilizing mechanism not only in the extension of credit, but also in preventing a country from ovpr-committing its dollarpaying/eapacity. "political" vary of ments Self-Evident Purposes Listed and hands greater measure of what commit¬ The Purposes of the Guarantees loss, the Guarantee have commercial political risk of the corporation might percentage above that * people who would guarantee scheme, the require the party guaranteed to retain at least 10% of each or in¬ o.wn —» number is obliged self-sirpporting. ex- extend payment now their more a cure potential;;market for the comprehensive guarantee is good, Recent inquiries ..among a small cilities: in posite view of what is happening the export credit field. The The nancing corporation or in fully The operating results lated the private insurance organization which would have an up-to-date com¬ for. coverage of commercial credit his position in the market. make other judgments; of bankers operating and formation (d) For such guaranty - contracts, separate fees would : be charged for commercial risks and political risks in amounts calcuto or extending credit, long and short—is no sub¬ Guarantee, Corporation's reserves and result, .in temporary operating deficits,"^ut claims paid against such "frozen! receivables" the of and. judg¬ very few commer¬ dividual i businesses the terms sources basis individual change difficulties in some couiw tries will cause sudden drains of are above sound a simultaneously and. loss claims are met and profits appear possible. Periodic ex- against any non-payment due to causes of a purely politi-, but select ' group of.' important cal nature, such as unduly prou. S. V exporters ..indicates?,that longed exchange transfer delays, substantial immediate use; would and other governmental1 actions be made of the .corpotation's faloss the as banks exporters cases.:expenses j' respect to, own ; „ information such The Systems Is Uniformly Favorable: , with . Experience of Other Coun- governmental financing organiza¬ Operating Export Credit tions now possess or could afford. risks can be more precisely and scientifically controlled and thereing due consideration to risks lore, need present no problem soundly acceptable, would be au-. from the standpoint of profitable thorized to enter into guaranty operation. ) / contracts of create combined The corporation, after giv- (c) all would , Guarantee are Credit our Banks, and for¬ pool¬ analysis, and interpretation economic, foreign exchange, political risk data acquired . Reviews Foreign Experience fries Association, The current and constant ing, ment ., _ .- Reserve eign central banks. be can also no doubt .S theu. International Insurance C°sts- First, the added cost may wel1 be substantially offset by a fj'ler or" lovver' bank - financing .charge when loansi; are collateral lzed b;v receivables;; insured or guaranteed. A part of, the pre- for);making recovered. loans eventual some Berne, Exporter . Ab- an ■rn«a'T' The disturbances. which cannct be Plan Formation American Export Credit Guar¬ antee Organization: A specific grant government assistance to on concurrence farm products. At within ; undertaking risks credit (always . limits), (3) generally passed on to the buyer meet ln the pricing of the goods. . a very commercial or offered banks would view reliance will be had less and less sonable evident that the avail-1 ability of such guarantees in other countries is contributing to the continual loss of foreign markets come assume the longer run, agency guar¬ be dent lb use the utmost prudence and. , corporation's, reasonably may over certain need c.ts c coverage) that unforeseen now- its) premium.'charges, arising (excluding earnings exchange and political risk catastrophe countries. . assets the an Existing U. S. Government and International Agencies do not and/or • from American V . claims other might result from any action on the part of a government-con¬ trolled guarantee corporation's setting of varying rates for each buyer country or refusal to issue guarantees relative to exports to antee facilities because American coun¬ tries exporters are more keenly aware of the for these comprehensive is v .- sophd judgment in; applying con- the field service of the Depart¬ from - fide n tially. rates Which would corment of Commerce, - the World claims due to purely commerdial;- respond; to the varying; circum-: Bank, .*. Eximbank, International credit factors would have to^po stances and fluctuating, exchange, Monetary Fund, the Export Credit paid out of reserves accumulated economic, and political conditions Guarantee organizations of other from premiums for coverage of oP a country-by-country basis, countries, such as the Union? de the commercial credit risks-... . a • The lack of such comprehensive guarantees Third: The re¬ strictions and/or certain other lated credit insurance. meet the needs of exporter v. understanding writing of such "all-risk" U. thereafter a issued ciples and techniques involved and safeguards available in the in pay of . aw? surssag^gf aar gaa POT^tSnv'poUtJcal^is^contScVs''woula be expected (and legislators) of the prin¬ ers portant first step in the right direction; how¬ ever, the greater risk lies not so much in the overseas Lack country,the .Th^s^e effort by American exporters and bank¬ a. given would All Second: insur¬ an failed nations. mmercial credit and exporters themselves in known their need for a comprehensive guarantee system comparable to those of competing in offering purely export ance concerted of risk such factors ) - ^... With assurance against the of being ^"frozen ; in" in any judgment of the corpora- and fixing a rate appropriate for be required forthey this normal risk. With regard to purpose of paying claims under the "political and exchange trans; . Credit Control political risk, contracts. As col-. fer risks" by charter of by Federal %The Guarantee Corporation lateral for such loans, the Guar-, Regulation, the corporation would would have to have yunder con¬ antee Corporation would assign to;-have to adhere to a raftge between tinuing review all political, eco¬ the lending U. S. Government.^ minimum (say and a nomic, balance of payment, and agency the claims settled -with;,;maxrmum. (say 0%}y V-., foreign exchange situations in all proceeds of such loans. ^he government, in other words, countries. The sources of authen¬ government loans : .ywould not dictate rates b£,coun- tic information which would be by the making American underwriter c o Lack First: the part of on political have • ; (1) the in tion number of reasons: a are: — ury of the United States (or its designated agency), such funds aswjiess unpredictable Organization antee ing tangible benefits to exporters viz.; normal commercial credit risks and ^non-commercial" or political and exchange transfer risks. . With respect tb the^first class, i. e., - normal ) commercial credit risks, the corporation would have complete flexibility in exer— cising its full discretion ih evaluatirig the various shades* of busi-" liabilities of the corporation under any "political risk and exchange risk" guaranty contract, the Guarantee Corporation Set Up an Credit Guar¬ Export American protect How¬ exchange substantially . covered, assumptions concern¬ reasonable would separate the tWo classes of suffi- not-be fixing in Risk should cient to pay to Attempts Past available; political; and are as time moneys in Guaranty Re- any "Political the serve Reasons For Past Failures exchange risk insurance on made are if ever, risks , exchange (convertibility) hazards. and political . sales financing when guarantees as outlined above ; . sales. unmeasurable as length of credit, -country to) freer to increase his worldwide collected for commercial credit) which, goods-5'are beihg shipped,exposure. Thus, two concepts' are risk coverage should likewise be credit standings of1 the buyer, blended: Stabilizing or assuring deposited in a Special Reserve whether the buyer is a'govern- trade in one market will encour¬ Fund for payment of claims aris- ment or a private individual, type age or liberate the exporter to ing from commercial credit de- of goods involved, and risks in- expand his business in other and faults or insolvencies, after hay- sured against. possible better markets... ^ " ) ing made necessary, allowances ) The proposed American ^Export (2) More: adequate? payment for expenses and dividends.";: Credit Guarantee^ Corporation," terms and credit facilities could by of underwriting the -, The rates of premiums charged by the guarantee organization(s) in other countries have ranged from about Vz% to 8% of the insured unpaid balance of the in- of the corporation; All fees penses perform the function of not only spreading the normal foreign commercial credit risks but also and com¬ mercial credit time ; statute to borrow from the Treas- Exporters even from ^ be for allowance pected for export time .to deemed advisable. contract collected fees risks plan and plan of action designed to re-establish promptly the American exporter's competitiveness, in so far as export credit, exchange and political risk is concerned, with his European counterpart. Mr. Scafuro refers to our past unsuccessful at¬ tempts to set up American export credit guarantee organiza¬ tion; draws on European experience; cautions he is not offer¬ ing either a cure-all for export sales financing or runaway credit extension, and asserts the proposed Plan can promote foreign trade and help our overseas friends without "giveaway, "subsidy" or "direct government loan." In short, the banker explains how a self-supporting system of private financing could privately own and operate comprehensive export credit, exchange and political risk guarantees—with limited govern¬ ment assistance strictly on a business basis—badly needed minimum with regard to any new en- All premium covering political deposited by the Guarantee Corporation in a "Political Risk Guaranty.' Reserve Fund"; after having piade ; due Operations: By FRANCIS X. SCAFURO Commercial insurance tirely within the discretion of privately owned and operated insurance companies. \ Providing Guarantees and for American Exporters Vice-President and Manager, Bank credit .Thursday, November 27, 1958 the or any on of time-consuming task of either the analysis or the of individual or specific credit risks. (2) For exports of all types of goods — capital goods, consumer Volume 183 Number 5798 . . . The Commercial and Financial Chronicle (2211) 19 ■ goods, and agricultural products, try' better than the outsider can hope to know it for years to come, the; buying country's esti¬ ? Within mated dollar-paying capacity. , as ^ (3) For sales of services goods. as and reasonable and customary business general ■ By/JOSEPHW.HIIIBEN*;-• r. ' Peabody. & Co., Chicago, HL to the and Hibben points out there is no • (5) For all goods contracted for future ; expert to protect the American seller against; risks of dollar exchange difficulties - or political actions which might deItrelop prior to shipment of goods Vr t Alaska • an export sales- contract V calling for future delivery. ' under &/-V V- In Export Credit Guarantee Corporation could set an example for promoting our foreign trade and helping iour overseas friends Wit h out establishing" another "giveaway;" "subsidy," or "direct government loan" program. In fact; it might do away with some government lending and return cohun'ercial /exports financing to private, enterprise. It. is presup¬ posed that over the long run, exporters purchasing such guar/ antees for premiums will thereby create a reserve fund from which i future claims will be paid. The V claims would be, in most1 cases, recovered by the! Guarantee Cor¬ poration from- the ultimate remit. T . general there are three types dollars of tance ' abroad. . debtors from \ . s ...» ••• * .V ■ n a nee f ixed /in e.ts;.abd! ass equity, .capital : , capital, stock to provide ent: workipg/funds ,V p e r ra,a;n and the gin .o a . mar¬ pf safety sure that ers lend¬ {debts Joseph W. Hibben , > are men can t is to "Never give a break," but I was "Be sure your in¬ tifiedl in Matanuska concerned// It, is therefore .with - absolute assurance Valley? Well,' your total then you should be able to interest: management experienced in the. production of plant food. If you cannot, interest people experienced in meeting the, specific problems Harry Sachs & L. Arnold, Goldman, Co., New York City, is recuperat¬ ing nicely „ from an oper- given ation project. : predict Harry L. Arnold pf that type of operation, you probably haven't got a sound deal. the capital required for any that I success. which has had him Fourth, I recommend that loca1 agriculture be encouraged as an industrial asset. Some economists incapacitated insist He for that the first for prerequisite arable land in the 13% of a ' month. wishes express^ of any economic unit is. for it to learn to feed itself. Ap¬ success parently, only about . to' his heartfelt thanks the to all his friends for Matanuska their Valley is under cultivation and Alaska grows only 20% of its own kind messages to him at Mount factors should business- reduce the general risks and costs food. The cost of importing the keep-in mind and what action of developing them. I have a few remaining 80% raises the cost of Sinai HospH Hurry JL. Arnold they take to make certain that thoughts along these lines which living, helps justify the high tal. Harry can wages their projects will attract what- may be of some help. be reached and increases the risks of all en¬ ever capital is justified by the through his home address; 76-15 terprise. An increase in agricul¬ V* Blue Sky; Laws opportunities they present? ' y< tural activity would justify some Thirty-fifth Avenue, Jackson In this connection, perhaps you First, there should be sound se¬ of the most stable types of indus¬ Heights, N. Y, The uniform try/such as food processing, feed may have read the column in the curities legislation] What of Action said, going to say, vestors get an even break," If do, you will not lack for capi¬ tal of any kind. But t is is un¬ Individuals with a successful rec¬ ord of operating experience, will impressed go a long way toward attracting resources * an even you you real¬ importance of tempt to attract experienced man¬ agement. Is a fertilizer plant j>us■ . take to stimulate devel- opmerit of these : sucker necessary advice because during management know-how in the suc¬ meetings in 'Alaska I have: met cess or failure of any enterprise, many public spirited, unselfish and ^his is particularly important people working sincerely for the at its inception. Risks to potential interest of all in this new state. investors will be greatly reduced- I have been impressed with the and (^qpital influx will be greatly spirit of enterprise and the un¬ > encouraged if you businessmen at¬ selfish, constructive attitude of all that 'Alaska has at least 31 of the 33, strategic minerals that the TJruted States needs, including tungsten, tin, mercury, nickel, cojpper, chromite, antimony, plati¬ num, etc., not to mention iron, coal, oil and timber. However, ex¬ cept if or stockpiling and national defense" purposes, ■.it seems that the only effective action business¬ • in the form of the other states Barnum the men - To bring about the early organization of the comprehensive ; ,, Export Credit Guarantee Corpo¬ ration, a definite plan of action is -.required: ■ ■ \/ ■/ ' S11- i-'-fc--1-' '• are Third, as businesmen the world over. But,, as Mr. of capital - required by business Sokolsky says, money will flow enterprise: short4erm .bankdoans where;money' can be more safely for seasonal or ;f self-liquidating or more readily made. j, ; projects, long*, ^;Bofare^ natural resources and t erra loans raw materials are concerned, usually in, the prices and gross returns are going forrp pf mort¬ to be largely determined by the gages tos.fi-. competition of world markets. We will be paid. Proposes Plan / feel you likely to succeed^' ize the tremendous scarce - « , shortage of short-term funds in nor , those mention my last point because it doesn't really seem appropriate. Stresses. Management Know-How anyunusuallackof long-term capital available for sound projects, though equity capital stents to be the greatest; problem of all. He strongly recomhwnda enactment of uniform Idue -sky law ' sponsored by the Nation alAssociation of Secure ties' Dealers, preparation of un inventory of capital needs and investment opportunities, and strenddus efforts by Alaskans to do their share of capitaf formation. specially /manufactured, pur¬ chased, or processed for Shipment The most Kidder, Peabody partner blueprints for Alaskan businessmen what they should do in order to attract investment capital.' Mr. political of ment Partner, Kidder, conditions in the buyer's country. . by some organization in sifting out the opportunities, re¬ solving them to the concrete and specific, and offering an 'assort¬ are tjrade, market, and products involved and consistent with pre¬ vailing dollar ex change, arid t right here at home.* Furthermore, local participation is very stimu¬ lating to outside Interest. I hardly feel it is in order to be per¬ can formed well (4) On payment terms that valuable service a . / A frank First: study of con¬ plan by a representative group of American companies vi¬ tally interested in world trade. • Second: Bank and insurance ex¬ should critically •• . a crete ecutives can study blue "Anchorage Daily News" on Oct. by George Sokolsky, which touched on capital flow. Mr. Sokolsky said, "Money has neither conscience nor patriotism but and policy Third: ested Government Bank Capital in Alaska Administration and legislators to assure complete understanding of and support trve This is particularly true of funds. It is my ob- Bill bill proposed the creation of an Exf port Credit Guarantee Corporaf tioh Wholly owned by the governu Sent. The time may now be opportune for reconsideration of } this problem, but On the revised, Strictly private enterprise basis , June, 1955. This ' ' 1 j •' ' * There ence formed not seems of to be opinion persons as there is any some even support from American industry in order io bring about an effec¬ tive and prompt solution to this sound a a securities law of a as regards offered to that mortgage funds will be more readily available. - , desirable to prepare an inventory of the capital needs and investment opportuseems hities which offer the greatest rewards. If a man walked into your show- him? What are the opportunities specifically? The Biennial Report of the Alaska Resource Development Board' is excellent, as well as the report on The Economic Base of the Greater Anchorage Area by the City Planning to whether or unusual lack of projects. a vehicle and save, article Perhaps in an some incentive saw the "Time" magazine last July T about Clarence Dauphinot. He was a Wall Street foreign bond trader who was intrigued with the opportunities for investment in Brazil, so he moved there and for several years tried to interest Wall Street in Brazilian opportu¬ nities. It- was a slow process. office with one million dollars to money underwriting syn¬ was Nov. which. 25 an issue awarded of on $32,800,000 City of New York, school conr struction and various municipal bonds; due Dec. 15, 1959 1973, inclusive. The group bid 100.1799 for the bonds as 3.20s. Public reoffering of the bonds Capital is created is being made on a scate from by saving. It is amazing what in¬ 1,90% in 1959, out to a dollar price dividuals will do when they are of 98 for the 1973 maturity. tirely clear under Alaskan law and this should be remedied so in- Chase Manhattan Bank is dicate be overlooked. mortgage holder Secondly* it The manager of an to fifth point, I suggest that local sources of capital should not Brazil was effort was long ways away. The only partly successful. But now "Time" proclaims Clar¬ ence Dauphinot and his company as one of the outstanding suc¬ differ- /invest in Alaska, what would you among As Cily Bonds Offered fo Investors purposes Local Capital Formation -t his title to the security is not en¬ , New York lower cost of living attracted a people to this new state, all enterprise would benefit. Your mining industry must compete in world markets. Too, high wages •make your mineral deposits mar¬ ginal and cause unemployment. I also understand that the status of $32.8 MiHioR Issue of more will simplify an otherwise costly available for One respected banker told me frankly that the good deals get financed. Another felt strongly that a number of atoutlined above. It is expected the tractive developments were being hew committee will receive wide delaved for lack of mortgage filong-term hand, If procedure ' in doubtful the other • $2256 impeding legitimate the type which investment bankers are familiar with in other states legislation authorizing granting of Alaska. The local banks and their the special charter(s) required. deposits have grown as fast as the ; Fourth: Formation of an infor¬ requirements of the community mal committee of exporters, man¬ and they are ,backecl up by strong ufacturers, bankers, and insurance correspondent relationships which f people to finalize a plan and draft enable them to draw on addi¬ a study bill for the needed en- tional resources when necessary. abling Federal legislation to per- If your banker says he hasn't got ( mit creation of the corporation (s). the money for your deal, he is It t 1 The international Section of the probably just being polite. New York Board of Trade has probably isn't a bank deal.: Of !! authorized the re-establishment of course, banks normally loan a Special Committee on Export money for only a short :term, Credit and Exchange Transfer usually less than - one year and Guarantees. A similar committee they prefer self-liquidating purwas instrumental in bringing poses. about introduction of Senate or skeptkal of any Alaskan, deal. On short-term for a specific legisla-' servafion that there is no short¬ to enact enabling age of short-term bank credit in program 3 mills, rendering plants, fertilizer production, etc. Some of these operation? which might be mar¬ ginal now would be fully justified by an expanded agriculture base. con- promotions have capitalized on the: public's interest in this territory. A few? unfortu¬ nate deals could make the public some inter¬ the business. I have heard rumors that No Shortage of Short-Term Officials their penalizing determination. Conference/with by sideration. Its aim is to screen out the fast and loose operator without setting up of the Corporation flows where money can be more and take leadership in its organ¬ safely and more readily made." • sponsored Dealers,is recommended for the ization sky: law National Association, of Securities 21 cesses islation and treats industry in gen- South America. His yellow jeeps ply the jungle trails selling securities and Marine Trust Co. of Western New raising capital, for United States York; Schoellkopf, Hution & companies who wish to expand in Pomeroy, Inc.; Swiss American Brazil. Corp.; B. J. Van Ingen & Co,, Inc.; Perhaps all of you know the Bache & Co.; A. G. Becker & Co., story of "Walking Swazey" in Inc.; Federation Bank & Trust Co.; Alaska who took for, himself the Gregory & Sons; E. F. Hutton & green Commission. However, this seems to be directed largely toward leg- of a and Other members of the offering syndicate include: Chemical Corn Exchange Bank;, Manufacturers Trust Co.; J. P. Morgan & Co., Inc.; Lehman'Brothers; Blyth & Co., Inc.; Lazard Freres & Co.; Barr Brothers & Co.; R. W. Pressprich & Co.; Goldman, Sachs & Co.; Bear,, Stearns & Co.; The Northern Trust Co.; Harris .'Trust & Savings Bank; Equitable securities Corp.; Drexel & Co.; The Philadelphia National Bank; Hornblower & Weeks; Carl M. Loeb, Rhoades & Co.; Ladenburg, Ttialmann & Co.; Blair & Co., Inc.; Hallgarten & Co.; Hemphill, Noyes & Co.; The .era! terms. Your neighbor, West,ern Canada, has been attracting capital from all over the world at rates varyingly estimated as high right-of-way of the Alaskan Rail¬ Co.; Wm. F. Pollock & as $3,000,000 per day. There are way from Anchorage to Fairbanks ^CoM Inc;; various reasons why capital is at- as his insurance territory. "Walk¬ First National Bank in* Dallas'; tracted there, of which .one impor- ing Swazey" walked his territory Rauscher, ' Pierce ' & Co., Inc.; tant factor is the favorable tax .twice each year about 200 miles. Trust Co. of Georgia; American treatment of extractive industry His customers were far between. Securities Corp.; Commerce Trust - Now that Alaska is bea state, some insurance company lenders will be able to operate there more effectively pressing problem. than before. Beyond doubt, however, the fullest development of Exchange Member the opportunities here will rePHILADELPHIA, Pa. — Alfred quire further encouragement of Rauch, a resident partner of long-term lenders. nancing. coming v Sometimes he cut their hair for Co., Kansas City; First National Equity capital seems to be .the an<^ caPita* gains, -, ? in Phila¬ 'them, or cooked dinner, but for Bank of Memphis; Glickenhaus 8c elected, to greatest problem, of alL While ac- ,. However^ I -spent a day in Ed- .five years in a row "Walking Lembo; Green, Ellis & Anderson; tive, institutional type stocks, with monton recently and I believe the Hayden, Miller & Co.; The Illi¬ membership in the Philadelphialong earnings and dividend rec- "Canadians have greatly improved Swazey" sold over $1 million nois Co.; Inc.;' Mercantile National ord's are in great demand and go their techniques of attracting capir worth of insurance each year. This Baltimore Stock Exchange. •Bank at Dallas; The: Robinsonis a capital formation technique. Mr." Rauch is a former President ever higher,, real risk capital for taUn recent years. - Almost every Alaska has an estimated annua1 Humphrey Co., Inc.; Stroud & the development' of natural. re- ^businessman has a deal in his the Bond Club of Philadelphia . Kidder, Peabody .& Co. delphia, been has • sources the Investment Bankers Association of and former * Governor America. of — - and new enterprise ; is :pocket and it is a specific proposal income of ' $500,000,000 per yeai ^complete from the capital require- 'and wages of perhaps; $175,000,000 'Some 'of the smaller and initia NOW, Alaskans knOW their coun¬ capital requirements could be met sai^lheL,te!atrment to the profit to be expected. merce Convention, Anchorage. ' Co.v Inc.; R. D. White. & Co.7 City National Bank' & Ttust Co^ Kan¬ sas. Cily; Sterling National Bank & Trust Co/ of New Yorki - The Commercial and Financial Chronicle ... (2212) 20 in exploration and development, but periods, particularly in the ^ rable era of expansion in Canada also lacks the large pools c'" the 20's. But what happened in the post¬ period has been explosive in resident investment in certain of magnitude. The vast rebuilding our industries has, however, given to some and enlarging of national econ¬ rise misgivings among Such misgivings are omies everywhere has been a Canadians. process that drew very heavily on felt not only because of the extent and he our influence on history has been of icle grow¬ ing together, but growing ally tations. the irri¬ dians feel that don't Canada it know good cup pose of G. Arnold Hart to since ever you tried mixing it with sea-water at Boston 1773. in But ring) was formed between States in the United and most natural ii-1800's. It covered as a result of attempts States. Despite numerous that has true however, products and lasted for 12 years, when it' -was abrogated by the a tea and I sup¬ been private Our trade ties with States were, United porary their southern neighbors how to brew by strengthening. In. eect, a free trade area (a phrase that has a contem¬ Cana¬ , largely Great Britain. occasion¬ some financed was that capital from London, and the bulk of our trade was conducted with together with differences, and de¬ to railway transcontinental a it revive over half next the century, "reciprocity," as it was then called, never was restored. your valid international for Expansion in the 1920's industrialized other most velop in an east-west rather than a north-sout.i direction. We built chron¬ a what from com¬ parisons — population; volume of output per capita; energy con¬ sumption—Canada's postwar rate of expansion has exceeded that of join British Commonwealth, us demands an Measured in terms that the world. English-speaking French-speaking and Englishpeople who settled in North speaking—who have worked to¬ America decided to follow separate gether to build Canada and who paths towards nationhood, their give it a distinctive character. spurred by to States and the rest of the United are degree insatiable seemed Ever since the Confederation that Can¬ accelerated been unprecedented problems. Terms Canada the compromise between two great English-speaking peoples; praises creation of St. Lawrence Seaway; describes his country's international economic expan¬ us to thus has premium for resources My country's growth abundance. on sion; intimates invitation natural basic ada is fortunate to possess in great the fine relationship between the two efforts being made to resolve differences and countries and disposal U. S. lead Nor do the import coun¬ of the investment but also because rising proportion of it has been in the form of equity ownership. of to 70% of U. S. long-term investment in Canada was in equity form compared with 52% 10 years earlier. This degree of ownership implies op¬ erating control, and operating control in perpetuity. Canadians have therefore put close 1.955, forward should be suggestions that they given an opportunity participate more than they do ownership, directorship and of subsidiary firms to more the troubles ditions these Foreign capital invested eign ownership implies a high de¬ gree of foreign operating control, significant extent a in will note, but the one does not fellow auto¬ than in 1930), has since increased, matically from the other. We by $10 billion to top $17 billion simply do not know as yet the at the end of last year. Again, the extent to which tne poiic es ami lion's share of this increase—$8 of activities of Canadian subsidiaries (somewhat less, you the $10 billjpn—was provided by Of the remaining $2^ billion, over half caipe from Brit-' ish > residents, ?, who thereby/)not only restored the amounts they had liquidated to gain dollars dur¬ ing the war, but brought their in¬ are dictated by parent concerns. the ques¬ tion ? recently .made by a trust company, -hefe^ in New York showed, very clearly, that the older and larger a Canadian sub¬ sidiary becomes, the less likely it is to be vestment stake in Canada to a wholly-owned by the record level. parent concern and the more like¬ Ti.e flow of Canadian trade also ly it is to include Canadians in Americans. patience, • Canada, which had stood at a little over $7 billion in 1945 by them. to con¬ slack some of our bones will simply get contention Resolving Differences Subsidiaries intention of "playing misgivings but they need to be put in a proper light. I said that a high degree of for¬ derwritten characteristic of are of buried. Canada. And down" the sense that our well-being are in¬ intertwined. Trading and demand, surplus capacity and high unemployment like the present. But these con¬ ditions seem to be improving and, located no Ameri¬ and outset, Australia. I have Canadians destinies with just as this growth has generated in substantial part "Canadianization" of of separably of by the United States and other countries, so also lias it been un¬ < alike, is the sense of grow¬ ing together that I mentioned at management been relations. cans in the in American trend genuinely feel that much basic and abiding, in the minds including United States, United Kingdom, Scandinavia and tries, oil, our trie current But I a By on for Canadian recent or exactly kindle zinc and enthusiasm U. S. surplus the restrictions program , of the Canadian dollar Canadian national identity. Nevertheless, gratifyingly reports ization. its Canada misgivings of American control over anomalous the probably been accentuated by the feeling that their national identity also of venture capital and collective is being impinged upon "know-how" that are often neces¬ through the communications of periodicals, radio sary to carry very large projects media and television and in such fields as through to completion. national defense and labor organ¬ The predominant role of non¬ war Bank of Montreal, Montreal, Canadian industry, Canadian banker notes, as welcomed and interesting evidence, that the older and larger Canadian subsidiaries have undergone "Canadianization." Besides commenting on the disquieting effect of American investments in Canada, Mr. Hart examines Explosive Expansion Postwar By G. ARNOLD HART* Without denying occurred earlier Commerce and Finance General Manager, what from nature Canada's Role in International Thursday, November 27, 1958 But; a,sample survey of And when of should recall in which them. seem we scious we The Committee of some are the the the of we States- Chambers two of countries' has met 52 times since it up con¬ ways trying to resolve Canada-United of Commerce overly differences, our set' was A newly-formed Can-* in 1939. adian-American Committee business men border, of headed Fowler sador is to both sides of the* by our R. M. former Ambas¬ Canada, Douglas Stuart,; functioning to examine and now* on your discuss, objectively and' 'in detail, all aspects cf our relations. A joint committee of your Con¬ gress and our Parliament has been and constituted consider to common problems at the legislative level. There are hp j&Oubt many other its board of directors and to have Throughout the 19tn Century swelled, in keeping with the ex¬ examples of such co-operative ac¬ citizens, Canadians in its top executive and the early years of the 20th, pansion of the domestic economy tion that will occur to you. whom v ' your history books call and foreign investment, to make positions. This is interesting and Canada grew much more slowly The one so oovious that we '■renegades," but whose descend¬ evidence, which may Canada the world's fourth largest welcome than the United States. But the sometimes forget it, is of course ants still take pride in their United well be borne out by more de¬ First World War and the decade trading nation. At the same time the St. Lawrence Seaway. I imag¬ Empire Loyalist ancestry. Having the direction of our trade shifted tailed studies now under way, that ine it is the biggest ditch that has established your own independ¬ of the 1920's witnessed a sharp further towards our southern "Canadianization" of subsidiaries ever been dug by two neighbors ence, you undertook to liberate us spurt of Canadian economic ex¬ neighbor so that in recent years tends to come about in the course which established new If not from the British yoke while Brit¬ pansion of their evolution and growth. Is for their mutual benefit. some 60% of our merchandise ex¬ patterns of trade and investment the ain was involved with Napoleon. biggest, it is certainly the ports have been going there and this not another example of for¬ that have since been accentuated. most expensive. And it will open And you nearly did. But we man¬ investment liberating na¬ of our imports have been eign The United States tended more 72% up, into the heart of the continent, aged to keep the War of 1812 This is by far the tional creative traits? and more to reach out beyond its bought there. an avenue of trade the advantages going until word arrived from heaviest I doubt, too, that the concern two-way exchange of of which we cannot yet envisage. overseas that it was ended. If own borders for additional sources about U. S. economic domination goods in the world. that experience did nothing else of basic materials and thus hasten My remarks to you have nat¬ Surely there can be no better of Canada is as widely felt as one for us both, it left us with the the development of Canadian in¬ urally centered on Canada's trade dustries to satisfy demand south example of the fact that trade, in¬ might gather from what appears priceless heritage of a border that and investment ties with the in print. After all, a great many of the border. A notable example vestment and the creative power our Stephen Leacock could truly Canadians work for subsidiaries United States. Before concluding, of growth go hand in hand. describe as "three thousand miles of this was the establishment of a I would add a note about our ties of American companies and few There are, however, some aspects of forts without a single frontier." number of newsprint mills that in other directions. In this con¬ of them seem to be restive about it. were initially built and financed of these trends in commerce, fi¬ It was only a few years later, in nection, I might mention in pass¬ by Canadians but were later to nance and expansion, and the re¬ ing that my own bank has re¬ 1817, that a number of Montreal Anomaly of Canadian Dollar come under U. S. control. At the lationships between them, that cently joined forces with the merchants, many of whose trading Premium same time, American manufactur¬ deserve to be looked at closely. Bank of London and South Amer¬ ties were with the United States, The effect of the inflow of U. S. ing interests were reaching into ica I.imited to form a new insti¬ got together and formed the Bank Canada for new markets, often capital into Canada is felt as well Stresses U. S. A. Control of Montreal. tution, the Bank of London and They patterned the in the Canadian exchange rate. establishing branch plants when Montreal Limited with numerous charter of this oldest of the Cana-> A large portion of American The premium on, the Canadian their sales in Canada justified such branches already dian banks very closely—indeed operating and capital coming to Canada in recent dollar that has prevailed in vary¬ others a move. at many places word-for-word— being established through¬ years has taken the form of direct ing degree for the past several out the Caribbean area. The upshot was that between investment in controlled subsid¬ upoti the charter of the First Bank years acts, of course, as a dis¬ of the United States, which had 1914 and 1930 total foreign invest¬ iaries and, in a number of impor¬ It is often said that Canadians advantage to our exporters and been drafted by Alexander Hamil¬ ment in Canada doubled from un¬ tant industries, U. S. control has are a combination of, and a com¬ also to the disadvantage of domes¬ ton. As a result, Canadian bank¬ der $4 billion to over $7^ billion become paramount. A survey made promise between the two great tic producers who face competi¬ ing has developed as a branch and the whole of the increase rep¬ in 1955, which undoubtedly un¬ tion from imports. The premium English-speaking peoples. That is resented money put up by U. S. derstates the situation system with only nine separate today, true in manifold ways and we appears to many to be an anomaly chartered banks operating through residents. And, not surprisingly, showed that U. S. capital con¬ are very conscious of the oppor¬ in the presence cf record-break¬ a total of some 4,600 Canadian Canada found itself in the late trolled between 40% and 70% of tunities and responsibilities it ing deficits in Canada's balance branches. And I must say we like 1920's, for the first time in jts Canada's pulp and paper, chemical of trade. The explanation is that presents. it that way. exporting more to Its and non-ferrous metals industries, You, for your part, history, Two months ago, Canada spon¬ the net inflow of capital has more saw fit to abandon Alexander neighbor than to the Motherland. 74% of its petroleum industry and than offset the current deficit. sored a trade and economic con¬ Hamilton's essential idea after a It had, even since the 1870's, been even higher proportions in the case ference of the British Common¬ And the two are to some extent few years, with the result that you importing more from United States of the electric apparatus, rubber causally connected. The large wealth, of which my country is than from United Kingdom. now have some 14,000 independent and automobile industries. More¬ deficits have been mainly attrib¬ a senior member and, incidentally, banks and you still oppose nation¬ The decade of the 30's was of over, the bulk of U. S. investment utable to heavy imports of capital the only dollar country in an defection from the British Crown we got a lot of staunch ; wide bank representation through branches—=a limitation you do not impose, so far as I know, other form of business. One or two on any • further course one drastic of highlights will suffice to carry the through the 19th Cen¬ In 1867 we achieved nation¬ hood by confederation, which was just the opposite of your Southern confederacy and which, inciden¬ tally, preserved for all time the separate identities of the two major groups of Canadians — the chronicle tury. emm—mm—m > address by Mr. Hart before the International Finance Section of the 45th National Foreign Trade Convention, New York City, Nov. 17, 1S5S. ♦An , ... t contraction led sharp increases in tariff barriers all over in world that trade to in Canada has comparatively firms which been provided by few, large, addition very possess, in equipment and such imports tend accompanied by a movement of capital funds to finance the same projects. During the 1957 recession and into this year the to be inception of to considerable financial resources, developed managerial, preferences, which highly however began to be gradually technical and productive skills and pace of Canadian resource devel¬ reduced soon after they were in¬ which in some cases take a large opment has slackened, imports stituted. One result of the British proportion of their Canadian sub¬ have declined, the trade deficit sidiaries' output. preferences was that many U. S. has dwindled and the flow manufacturers built subsidiary On reflection, it is obvious that of direct foreign investment has plants in Canada to export to Em¬ these characteristics.are to some abated. No doubt in time these the world and historical . . , to the British Empire pire markets as well as to serve extent natural and inevitable in trends will again be reversed. otherwise sterling area group. conference was world "the in The aptly described as miniature," for its 12 member nations span and encompass 600 the globe million peo¬ ple of every race, creed and color and in ail stages of economic de¬ velopment. The revealing thing about this conference could sit was down that its members together and in highlights in order to show that what has happened to Canadian- spite of their widely differing points of view could discuss their mutual problems without acri¬ mony and with a genuine and ef¬ fective resolve to do what each U. S. trade could, the Canadian market. • years circumstances. Canada's re¬ National Identity have been developed, as I To the extent that it is gener¬ said, in response to needs much larger than her own. Not only is ally felt, the Canadian sense of domestic and investment in re¬ the market in many disquiet at the role of American cases too small to justify extensive investment in their economy has is not different in its I have sketched these historical cent the sources by concessions offering and commercial financial assist- Volume 188 to ance, Number promote 5798 the . .The Commercial and Financial Chronicle . trade 21 (2213) and economic development of all. The Commonwealth fhus affords a liv¬ ing and working example of how trade and good-will investment backed liberate man's can Bank and Insurance Slocks by crea¬ By ARTHUR B. WALLACE tive power and foster understand¬ ing on world-wide a By ROGER W. BABSON front. Perhaps I might include by pointing out that the common heritage of members of the Com¬ monwealth in their belief" in popular explanations for Republican's election by Mr. Babson.; The columnist declares the Republican Party is not dead and will come back with a landslide after the independent voters (10% of the voters), who are said to have Republican leanings, see that the "cure" to their physical, mental and spiritual tiredness is worse than a parliamentary form of govern¬ the fact that they were ment and all, at time one or another, gov¬ erned by the United Kingdom. For the information of other coun¬ tries that meet these require¬ ments, I can quote no better au¬ thority than Prince Philip, who said in Ottawa only two weeks "Applications- for member¬ ship will receive sympathetic con¬ ago, sideration." I was on the ocean What It All Means re- turning from Africa, an imporCongressional election took place. In looking over the news- My greatest surprise has been talking this past week with busi- tant ings they range,: Eisenhow¬ er" GOP is dead;" ' Eppler, Glenn Co. Texas Eppler, Turner, Inc., Fidelity Union Life Building, members of — and the New York \ . , • , "The to ... Of course, the ' election is a: great disap^- pointmentto E nounced James x- It er;; "butmy,' .statistics show an¬ that- C. that 1 Secretary of the corpora- tion by the,' Board ", firm's of Directors. ; McCor- Mr. . mick has been ass<o Eppler, G u er i n Turner , a n C. MctormtcK d since March of 1955. Prior with Dun and was President of dated with to that he Bradstreet, Inc. if the as stock to tional value of of record subscribe stock shares share new held on Nov. on for 206,446 shares common one the an $10 of on J. J. the par each record 12 date. by Blyth & Co., Inc. B. Hilliard & will Son underwrite the offering. The net proceeds from costs and to retire about bank loans struction incurred $3,000,000 for con¬ expenditures. Dividends the on common stock currently being paid at the quarterly rate of 35 cents a share. A fourth quarter payment of 35 cents per share to stockholders Of are record Nov. the new 21, will not apply to shares. Kentucky ating power is an oper¬ utility supplying in 77 counties in central, southeastern and western Kentucky and two counties in Tennessee. A subsidiary, Old Do¬ minion Power Mr. for ^mvernmcnt until due Sept. 30, 1958 Hull no more received I • . and that, I $50 took Loriliard P. of common stock. In about this invitation an to case Old until Hull Mr. and platform called to me introduced the to me ;the audience as "Roger W. Babson Tl«MV>A/l1»AtlA nnvTA/l Drt 1*1 Tf Newport additional 670 shares of H!!hert!ld1heTtewstor!aThi's few years before the Democratic Party again swept the country and elected Franklin D. Roosevelt, who had it under con¬ trol for going on four terms. The same situation could easily repeat itself for the GOP. was only a Russia Must Be Ilappy rights will expire 1958. times, I do not expect a I believe, however, economic and war recession recent that the the be- marked on Dec. 9, being under- by"^hmtn°Brot1ierfand Co-. S™lth' Barn<; Net the proceeds from the sale of stock additional1 added to company in will be general funds of the to be applied to corpo- fate purposes, i^chiding short-term bank incurred chases of reduction loans which principally to tobacco required by an expanded volume of business. Total war. that Russia has planned an inten¬ sive The offering is finance Lorillard's increased pur¬ As I have mentioned in my col¬ umn many revenues is Colo. — Orville H. .? '• of the company during the nine months ended Sept. 30, 1958 were $353,501,186 compared with $190,943,368 in the 000 a group Nov. 20 offered $16,800,of Republic of Panama 4.80% on reports have indicated lar^o iarbe coiporatioia enough large rornorations corporation thorn to Xctfon a a in frond trefd the that wiU bring moie boiTowing bring more bouowing. . . ■ A recent announcement of First National the Apill 1, 1993 and first optionany redeemable the 1, 1968 at interest, yawing approximately 4.73% to maturity. The is group paying ICO.17%, for a net cost to the Republic of 4 79% City Bank was that lor time April offeriJJ Hnd accrued JJJJ c^fi .. u- r nn would holding ^ company to acquire control of c First City and County Trust of 1a| aai1between thie White Plains. This, it will be renf called, was a plan of First City's Canal to tap the banking business ot Westchester County, under a re^ ' fn rf cent Congressional enactment. The h matnHtv hI proposed move had encountered issue maturity are to be dethe opposition of the State Admin- rived from $1,000,000 of the $1,istration, which had induced the 930,000 annual payment which the legislature to "freeze" matters as United States of America owes, they were. A court fight would iitv, +h TronUr have been interesting in that it would have resolved the question perpetuity for the use and occuof whether the State could inter- pancy of the Canal Zone. The being bank hti!? end its efforts to set up a ^ H1 if Lfn^iSpr ulillh wS con^ ^feP Pan^na . undel. ^ Jreatuy' to Panama in fere with a Federal enactment. 852,854 shares of common stock NATIONAL $1,000,000 payments being are as- ——————————- Therefore, tion and our drift socialism toward inflamust make happy. Unfortunately, being in Africa I did not hear the addresses of the victory for the union labor lead¬ the income in the nine 1958 month in the 1957 period, Teamster's Union and in view of the election is me. We are when he takes a analyst bank end of State the "freeze," but at this juncture it unlikely that a change will be made for some time. The stage seems j street, f f H , , • J k the First National Oitv RIDGE, 111.—John O. Knupp and David W. Schuehler are now with Everett E. Ballard, Park Place. nf i loan. „ J.P.Morgan Amalgamating National Bank of India Ltd. & Company, and Grlndlays Bank Ltd. 26 BISHOPSGATE, LONDON, E.CJ Bulletin Inc. Available London Branches: 13 ST. JAMES'S SQUARE, S.W.1 Bankers to the Government In: ADEN, KENTA, UGANDA. ZANZIBAR A SOMAL1LAND PROTECIDRA3B Laird, Bissell & Meeds Members New York Stock Members American ExehMg* V Stock Exchange v. r (Special to The Financial chronicle) 505 retired, ™ ^ ^ New Yoik as fiscal agent for the LIMITED 54 PARLIAMENT STREET. S.W. 1 Two With E. E. Ballard are AND OVERSEAS BANK signed, until all bonds ^ PARK as one the for Head Office: beyond feeling better only called (Special to The Financial Chronicle) CHICAGO, 111.—Charles J. Nordigian is now with Wm. H. Tegt^eyer & Co!, 39 South La Salle of misdoings. Why the stock market should have gone up Recently, GRINDLAYS Tegtmeyer Co. Adds union man does with Hathaway In¬ a Corp., 1845 Sherman St. "highball." now the barSra^n Lehman Brothers headed which enough enough period was $19,303,200, equal after preferred dividends to $6.46 a share on 2,905,654 common shares, compared with $5,795,662, or $1.85 a share on a similar basis on 2,- (Spacial to The Financial Chronicle) DENVER, earn¬ we have statistically a number of unemployed, country, of vestment large amount of corresponding months of 1957. Net other Sowl a ginning of it. Even today, though feeling is much better in this 000, or $1.94 a share on the same Hathaway Inv. Corp. :'/• Recent right . Tha were number of shares. • V common " 1957 total oper¬ ers. Not only was the "Right to ating revenues were $38,871,000 Work" proposal snowed under, but and balance for common $4,801,this was after the investigations Joins * Panama BOfldS Offend stock in the later period con¬ siderably diluted per share ings in the later period. manufacturer Gold and the sale of new dinner for the purpose of reviv¬ stock at the rate of one share for ing the Democratic Party. Even each eight shares held. .The sub¬ then I thought' nothing about it scription price is $68 per share. the calendar year * . . Offering Loriliard, Co., Kent, $41,596,000 and balance for successful Democratic candidates. common stock was $5,828,000, An analysis of the returns indi¬ equal to $2.35 per share on 2,477,- cates that the election was a'great of oups earni gs. ;What would "fures were shares stpckrrdisdflefldassuming retention,of the $2 annual rate, have the effect of keeping the ^ ^e^tral !S^,» a Russia very ended of increasing the cash dividend, After^all,; Manufacturers is disbursing only-about; 50% of its a 10%/ also be logical would be such astock dividend, along with subscription rights for additional stock. This Lank has the highest deposit ratio of the large New York institutions, 13.4:1 pre-/(deposits*!:, capital funds), and 1958.; while this^rainoderate ratio as ih~t thought gate of about 246,000 customers. Total operating revenues for the 350 "tedrter^^s^mhnue-to ^ rmStRd be? ucts, is offering to holders of its common stock of record Nov. 25, have either started to rebuild in1958 rights to subscribe for 364,- ventories or have stopped reducing I large months opinion that^ thlv^ill eaual S for the rent. Co., serves three counties in Virginia. The company and its subsidiary serve an aggre¬ 12 of cigarettes and other tobacco prod¬ shooting Utilities public electric to is" Wilson, followed by * "what if months three regard A. the of¬ fering will be used to finance part of the company's construction of continue modestly better consists of intelli-, voters) will Thisdepartment from my pocket and gave it to him basis the for 17 addi¬ against corporate have seen by the as we all meahs't and not!d<^ sent a favorable-picture for pend dpommy conclusion. Let mte' We Shw evidence of this in the go,, repeat, however, that the Repub- operating figures for the 12 months chairman of the defunct Democra- iican citv Party is not dead and will to Sept,. 30, 1958, when, despite asu. 1 ?i reserve city banks in tic committee. • Before leaving COme back with a landslide after the recession effects eight of the Washington, I called on the man this 10% become again disilluthat large capital-fuhds vis-a-vis 13 banks showed higher earnings who was later to become Secre- si0ned. Yes, they will find that than for the 12 months to Sept; 30, tary of State. I found him in a the promised "cure" will be worse 1957 a Period in l»»/, a Period in whieb the eoon- And, f10*n the shareholders point, which the econq{ yiew additional capital wouW tiny office of the Press Building, than the "disease.'* ' " " f omy was going full speed. And, in When I asked how things were! most instances, where the earlier "ring added earning power, goingr he showed me a letter from period showed better results, they the owners of the building stating were, only slightly better., In one that the rent of the office was over subscription price is $33 per share. Rights expire at 3:30 p.m. (CST) on Dec. 8, 1958. A group led or earning*? good Bankers Underwrite The and Bank physically,: mentally,- - and even spiritually. This group (about 10% the Republican landslide, Mr. Hull had no official position, but was Kentucky Utilities Co, is unless they received $50 imme¬ offering to the holders of its com¬ diately, Mr. Hull must get out. In rights •%:: set new gent The mon be Christmas trade is likely to set a independent . Kenlneky Utilities Offering to seems even be . Underwrite Bank Stocks — banks "bigness," got 44% of the national vote. named the independent - citizens with; Republican leanings to the right.; •caiwe of' the teavv lagw W. Bahioa They visualize a top for profits,! fihancing; facing ■ the Tfeqsury. This is not too-' with the cost-of-living, taxes, andvr Thei), working assets of the large bad. Let me answer the second competition constantly climbing:/ banks-'are sbmewhat higher, for comment with a personal story. They are not voting against, any-! the; bxtentr of the : shrinkage in When I was Assistant Secretary of one, or for anyone; but are voting loans has been: much more than Labor during World War I, I be- for a change. Having been on my offset by thje' increase in investcame well acquainted with Coi- African trip' for the past two ments.* Thus," with' more money dell Hull, who later became Secmonths, I ask each reader of this working 'for the banks, with firm retary of State.' After the death i Columh to answer- for himself rates,, earnings are likely to Mc- Cormick has been seems of the GOP the on Although loan volume of the court decision in the Bethlehem leading New York City banks con- Steel-Youngstown case. However, tinues a somewhat halting pace, it ultimately these combinations are is mounting with the seasonal probably going to be effected if factors behind it, for there can be the growing economy is going to no denying the fact that the econ- be served. We already have very omy is staging a high rate of lai'ge bank branch systems and spending in almost all directions, holding companies, and in due American voters are getting tired ~ Mr. Eisenhow-; , S.t ock change, interest course will have more of them, high, and that, among other A rumor has circulated to the things, requires large inventories; effect that Manufacturers Trust bankers. Their explanation of the and these, in turn, are carried on may declare a stock dividend and election was, ; unanimously, the loan at the banks. Also, we read then be involved in a merger. This taxes which we are compelled to of big crop production which, too, department doubts the merger part pay. They : recognize that Presi¬ must be financed to an important of the story .for severaF reasons, dent Eisenhower-is a good man banking system. one being the <• probability of a with high ideals and that he is. degree by the trying hard to do right, but feel Recovering from the 1957 setback conflict with; the"freeze'^ law of in business is keeping loan totals tbe State.i But a stock dividend that he is not "'practical." Of well up at the banks. : would not be illogical as a means course, this is weak reasoning. manufacturers, and nessmen, head¬ I find paper of include these: ,,!;■the "disease." While fto DALLAS, Items examined are from "A blow Guerin This Week Variety of defeat * Branches Ins 130 t i BROADWAY, NEW YORK 5, N. * - Telephone: BArclay 7-2300 INDIA, PAKISTAN, CEYLON, BURMA, KENYA. Ben TANGANYIKA, ZANZIBAR. UGANDA, ADEN, SOMALILAND PROTECTORATE, NORTHERN AND SOUTHERN RHODESIA. (L. A. Teletype—NY 1-1248-40 Gibbs, Manager Trading Dept.) Spariatiats '»» Bmnh 22 countries > of serves an almost irresistible tempthe - United; tation to internal: monetary - and States, Switzerland, and « Vene- fiscal relaxation and hence, «infla? zuela, the present reserves are tion, and would .thereby quickly < obviously insufficient to cope with - dissipate nearly all the gain. Subanything more than rather* minor stantial damage from-speculation deficits in the current balance of on the foreign exchanges,'In the international payments. In them- period before the change in gold the • hteraatioaal ( Liquidity and American Foreign Policy By JAMES W. ANGELL* Professor of Economics, Columbia University, New York City important except more V ; Three further comments should liquidity is highly unsatisfactory, and even dan¬ gerous, and that it precludes any attempt to re-establish an international redeemable gold standard. In proposing measures to improve the situation, Dr. Angell doubts a "one-shot" rise in price of gold would remedy the "spectacularly bad distribution of toe world's gold stocks" and buds it would induce price inflation. Instead, he suggests countries pursue disciplined measures of internal monetary and fiscal control, in addition, that raw material producing countries arrange buffer- made be could made be liquidity and of long-term dollar i »/ailabilities .endous importance in the world oday are clearly of tre- both in m (hey embody many other strategic aspects of in¬ ternational t ^pid new »riese lems James W. rather countries, xoreign ineir .. sum in the short few a run. Like- central cbuld countries banks in times smair fluctuations relatively preciation. It has happened many times. If major The A e 10% go can less than to Standard Gold 1,qU,dlty'1 ' economic economic unit uwt to to be he the f ultimate our fnt ese ,Of Dthbse; the most important, pbvix)llslyyis the adoption and en-: : by"-':'all..;:th£ leading _yesofic0utife-ies, ;6f far better and volume j-called liquid the assets and firm's itc tntni A nation's liouiditv sense " * of . - - ierefore, is more usefully meas .ad by g the ratio between its iiauiditv which reserves Moreover, most, fmerna- .... , I hidings I.Stable ciose and lar« pletely solve the' international li¬ quidity problem for; them, but at least they will no longer be greatly worse __ w 4^ , a _ ^ ^Uv.— j t.-tyments : i«_i_ ii. which it , on y ; e over the next . i> can Hence' vear nation's liquidity position mav altered in any of three wavs* *1 changes its <-z in holdings the absolute of liauid cash receipts. size: of The — t _ "A SLe \ 4f,.„ '• problem ! ' of the long-term * and a availability of dollars, or for that * resulting coUap^c r currency, no increase the volume of other coun¬ -.ottiw^iiiajor, and enduring solu¬ tion, however, for those countries tries' imports of goods and, services, whether American or of othei* , . , .... -««. u.v^,wuuu»w ; • The imports,. in turn, are wprp tne siiu&uon. fairly advanced level of- economic wanted to maintain and raise the : requirements were abandoned, general level of living standards l''or continental Europe the aver• j to Imm.#ve - ' developments- which are in the age was 26%; for the' «W-aisnte improve main rather highly industrialized, abroad, either directly or by the ' more complicated route of internal 1 United Kingdom 25%; for France, .liiquiility and which have a rather large and chronically in difficulties, only First, the United States has al- *1 diversified foreign trade. For economic development financed in —less than one month's cov- ready proposed an increase of them, no level of international part with outside funds. ela^e any substantial suDsiannai v leLral ,. 60% in the resources of the Inter-' liquidity which they are likely to national Monetary Fund;, and I be both.able-and willing to afford .would. myself prefer to, double will give them complete security. them, or more. But even this, last Providing them with more liquidstep would achieve only a rather ity, if nothing else is done, is adverse '■lij5lted- gaTo 1Il^ouldi!noi?ina11? m*™1? to treat the symptom, not aqyerse, add some $3 billion of gold and nv.rnaj subsSnt^?^ ^afn ve^v imPvP^ monf.tary «old stocks ofcpc fmd that m mid- fiSif already achieved a origin. • ~ Dictere w' w?? 2.11!: ™ the cause. , To make a fair judgment of the | long-run prospects with respect to dollar availabilities; it is again; . ^ ternational payments and receipts c ®^' _ m : other international is on a rather different of import demand, and that-cpnr plane. Such dollars—if I may: limit ' attention here to dollars alone— ; These are, of course, familiar are not wanted primarily to pre¬ serve international liquidity. They propositions, and they may easily are wanted to help maintain and i©cession ^°"e^°-;1?.p-aYf^wl^A -have- .. Statesj the distribution liquidity is extremely uneven. f-0 ?, «vaiiaoie ior avai)J nompsrif Clearly Vieariy — Uxuied ",m ,r '• 1 disproportionate domestic infla- ^Sai®kibi:,la?i!^ perfection. I see as constituting mere mxernauonai sexue CQUnsels of , pvpn * fThe main facts liquidity at the about.the levels international ciio °{ ' —.. 1957 the 1?57 rates, on the average, lWlc' rates, on the average, n^ur„r. given above would indi^68 all ptnln-rptsprvrp even if all assets <f < uecdU»e oi oomesuc r^erve the v its '. whole out- For Latin. America the ra^° was 20%, for Canada 19*%, } y changes in the current volume and for a11 the rest of the world n its payments due abroad or bv'combined ^ess t^ian or barely hanges in the current volume a ^n011^'8 coverage. . Ly v , e£er S'nce the. end if reauirpmpnts even,if all domestic gold-reserve domestic nhjandnnpd asonably i^e~et to'have to make i. some specified future period ^ * abroad hfs„bef? 164% for the United States. as a off thari the; more advanced countries.^ matter of any pay fOT two months < of imports at W for two months of imports at . tes, on the one hand; and ..Li ■J other, the totaf volume I was ;But for the world -v ports, through development pro-X Igrams supplemented J by. foreign vent both those balance of paymehts disturbances 4haf arise from t°ry ana maeea dangerous, ana basis for comparison 2 the 01 «oM holdings alone in 1957 imports die j- dilemma by diversifying their production patterns and their ex- ent domestic em^oyment, ^ ^ alone s 30 Usln! imports '? pp- • . u countries t] can escape of their pres^- from at legst a pari more^^u^for o°^ue^ ...... substi- internationallv of cash 5,ear o* time to prevent domestic financial arid 'technical assistance. or at leaSt to prevent a Neither of these things will'Com-,' ®^„X^'f^?5i?^^«??.5^!^[.:?^.:ratef''-;a&TdomeStfc^Mihflaftion5;-.that future terms of future and h and hence> unfore" stable needs, but a standard needs, but ...... - foodstuffs impose!' The objective must be both to maintain nearly full errmlnvmerrfarrd At ihri " provides essential mternar P.^Y1?.68 ?SSenTiai almost foredoomed.7 the longer term • the raw-materials^ and ; over; *nfiy most side the United States siue me United States, u was only unnea oiates, it oniy 19%! This was bare] 19 This was barely enough to " ~ ^ contributions.Producer-dominated J, disturb- - Al- schemes are far excess Liul suggest. comments deal to protect themselves by the * adoption of properly - conceived ' long-term contractual arrange¬ ments with the industrial countries " j niit it a cSrii now6holSd iTgrossly^STW £2®.« I take the notion of the "liquid- ; i . though the question has been hotly debated on both sides, I think that ,v most of them can also do a good ' far been will- ehraiiH Serhauid*tegin WitH intern&" ' v, materials and foodstuff need not remain quite helpless, however, as the pre¬ as ceding JidTternalhaonetary and;fiscaleoatrdl ^or Return objective is to }?1 freely-working system international payments based of dimensions, ^ consider ' the raw countries balance of payments/Even )f the currency price of gold were doubled, for example, ah even if all prices remained stable, France in^national they murt not .be^exagg^^d; ^ gold> the absolute size of the v.veen -'v. The in the of v outright de¬ restriction and even With 5 tO 7 fa apiece. restore . practicable an an all-too-familiar paths of exchange ddfhestic thus J1we^r' can cariJ lie distance toward a consider- of 01 ; may be wiped out al- ^ overnight, and t ey may. ! themselves forced into the fmd of excess above resources crisis. Hence, the figures cited bined only another 5%.! Even if above give still approximately would still have only seven .weeks' we broaden the base to include the correct picture. Second, it is imp0rt coverage, Italy 16. Not not only gold, but also all short- true that the United States has oniy t0 counteract but—far, more term dollar assets and tt c Gov- l°st nearly $2 billion in gold since U. S. 4" -j~h— lost nearlv coin importantt-to prevent any severe +«, Angell exarai- jwever, can carry us a Vw most of the less advanced many or of quotas °nly eign Is Out . jr such ... Avers .. i l the pressures—that is, borrow substantial sums from for- _ here. ^ some $1.5 billion But the small size and all the rest of the world com- prob-> oa. the which Union, how- -could' be made effectively availsmall. The Fund, .on the able to meet adverse international hand, has the wise •illgS, ation resources countries of this tacular * dollar and Venezuela, most solutions for - and most countries, monetary reserve requireitfents— and the Fund's own, rules, ' se- "would in themselves alone still be verely restrict the actual usability inadequate to pieet more than Switzerland had substantial hbld- a coun- iries other than the United States, Switzerland of l>ose any spec- i.rief the by Monetary Fund or European Payments Union, ever, are and the. rest of thb world 7%. || Among other leading countries j| -only West Germany, Canada and I hall not pro- Wven available the g and tjolicies. and the funda- up, and — therefore also the end of 1957, while Continental ancj protracted international presgetting a Europe and the United Kingdom sures, therefore requires that buffer-stock plans and other com¬ Wh, -world total of $56 billion, the —especially the latter—have to- other more powerful and more I picture is not greatly changed.2 aether gamed rather more than enduring steps also be taken. modity agreements. .The key to v success here, I think, is that there l I Continental Europe still held only this. Welcome though these moveshould be equal representation ; J -28% of the total, the United King- .ments are from the point of * view Strict Measures Instead of Gold of both consumer and producer j -dom still 7%, Latin America 8%, of raising the general level, of ; . /•/"* Rise / . groups, and where relevant; equal because relations ideal ernment bonds and notes held by themselves and and fiscal policies are. few are -r- they must V rely extensively on ^ the implementation of adequate domestic policies, such., as those ] outlined above, in the industrial ' countries. If the latter countries fail to act in appropriate fashion, } the international 1 i q u i d i t y of < monetary The net funds of the foreign recipient countries. i rapidly used whtehalmost unchanged. For most International other international t any event, however, these both only one-shot measures, are , hence, in considerable degree ; at the mercy of the fluctuating , demands of the industrial coun¬ tries. Even if their own internal r mental problems would re-emerge of the additional resources with international aid. of v . are Once they were in force most of their benefits would be rather in still available.6 problems very definition, are heavily dependent on exports of a few materials or foodstuffs, and by raw effective, liquidity figcomputing the First, ures. and diversify Encouraged by in¬ creased private supply of dollars going abroad, the Economist submits a plan to increase it still further to aid our national' foreign policy which entails some sacrifices on our part, some changes by our allies and necessitates creation of a favorable r ; f country and regional percentages given above, no account was taken stock plans and other commodity agreements, The is likely to be much more restricted. Most of these countries, tion, In these on their production hi vestment climate in became might also result. tracted large pressure. international j price actually payments posi- current balance • of .. world the selves, alone, they would be utterly unable to meet any pro- Despite this year's goM outflow, Columbia Professor finds r November 27, 1958 The Commercial and Financial Chronicle.... Thursday, -(2214) to start by looking briefly at the recent facts. For i this purpose,-1 shall take the term necessary They must go to the - "dollar availabilities" to mean, not. merely the proceeds of American as earlier as remarked earlier—-the small; thpm thp wai hMrf :k nwn foreign investment and govern-, ment grants, but to mean the total supply of dollars which is fur- < nished to foreign countries, whatever the source of the dollars. This, o^d* raising the dollar price of all other countries. To secure the is the total of our payments for S?.d ^as been nrged by many, full benefit, however, every ad- imports of goods and services, plus !ooks llke5 an attractive; vanced country must act in the our capital exports, plus all other cure-all. I see .two difficulties,. ways indicated. It is a perfect government payments and trans¬ however. For one thing, it would case of action for mutual protec- fers to foreign countries. to . . the From beginning of 1946, through June, 1958,8 which is the; latest date available, and taking all reported sources of funds to-; gether, the. United States supplied-, , The great, of the less de- mass the . other difficult posi- 7 Also see the . extensive discussion of l commodity schemes in the- recent GATT } arm ■ tn only 7%. countries «An - d<lre-.* hv The Latin Amerlhad Mr less An„«ll than Ksf#. 5%, - #1.. S'Z ^TL'n\. 4 k J ^"SS&SSSl["SffTS t™"""' 9S^» ^ Ve»e«»ela atyrc;NnovTri9d<! ,958' New ST7 ^ »"«•/ 19> i968V""ion' ItaJy two, France less V" ' . u^Sai'." GS °,her no°-iterl""[ c«erag., one. "un" Uy m.a'»«,'a.wi present the paper. are •<»«»>■,-. and , eminently, appropriate 6 International Monetary Fund, 7nf«r- ^ than ST'levds desirabief and domestic fiscal policies are monetary essential. ^ ^"[^. SUCh totfor them the effectiveness of , policies, in Controlling the Report, Trends in International Trade; (Geneva, 19S8) - prepared by a Commit"/ tee of Experts under the chairmanship, of Professor 8 The last Haberler. half of <• 194S is emitted he- effects of Lend-, Lease, UNRRA and - other operations left' cause over of the -distorting from the. war. . . . ' Volume 5798 Number 188 . . . The Commercial and Financial Chronicle % total sum of $273 billion foreign countries.9 Of this gross totals exactly two - thirds came from .our purchases, of foreign a gross to goods and services, including mili¬ tary items. 22% came from uni¬ litical upheavals there to seems major or, be no ment for transfers,; chiefly <U. S. Government grants to foreign countries. 12% ment and investments other equally nearly from came divided loans abroad, between private and governmental opera¬ tions. The distribution of the sources of supply of dollars as be¬ tween the private and the govern¬ ment sectors is The equally significant. sector supplied ex¬ private actly two-thirds, the government sector, one-third, ylrri th^ : private sector; imports of merchandise counted for 45% ac¬ of the gross total is chiefly the present jtime, merchandise are How supplied 6.4%, and unilateral pri¬ per vate transfers Of the govern¬ year for only 16% private foreign new Managing Director, International Monetary Fund, ; c Washington, D. C. V them¬ . to Achieve This National ' Commenting on the recent improvement in the reserves of most industrialized countries and the general current opinion that If we accept these objectives seriously attempt to achieve them, however, a series of prac¬ tical' consequences , •' ' and "nobody t^ ' ■ which follow ■ not are people. equally palatable to all Tney are consequences both for us tries. and for foreign • coun¬ For ourselves, we must im¬ , prevent investment.11. Such merchandise imports are aiso, in general, by far (chiefly philanthro¬ more. objectives wa$ or from time to gressively tariffs, to ment total of $93 billion, some $75 the most desirable source of sup¬ billion came from military grants ply of dollars, for all the familiar and military expenditures abroad.' reasons.^ They have increased 2V2 The geographical distribution of .times in dollar volume since 1946. must time;12 reduce ever abandon, emergencies seems gained from the devaluations of the 1930s; praises highly the contribution of international commercial bank at least greatly reduce substantial cyclical cuts in the credit; and gold may create excessive liquidity and, hence, give rise to inflation. warns that too much great deal we must pro¬ protective our lower levels; we in special unless A has been spoken recently about the problem of international liquidity. and written for genuine and A year ago when the economic of national defense, ;1■ recession beour quota^systems; and we must ; came more m break up our present irrational the $273 billion we. supplied to There is no inherent reason why evidence here foreign countries is also extremely they should riot expand steadily." arid exasperating tangle of agri¬ in this coun¬ in the future. / /.://'//-,• cultural export subsidies, dump¬ significant. Of our private imports try, there of merchandise in 1956, which was ing and again, quotas. "" ;.-'v IV w e re/ o f But we cannot ao the job alone. a boom year, 30% came from the This last proposition can be ex¬ course, those OtheT countries, our actual or our Latin American^ countries, 23% who remem¬ tended to the whole of our pri¬ from Canada, another 23% from prospective trading partners, mustvate operations that supply •; dol¬ bered, espe¬ take Western Europe; the essentially similar steps., remaining lars to the rest of the world, cially in Eu¬ Otherwise the whole effort will 24% was scattered.19 On the other whether these dollars come, from rope, how be.".condemned to, at best, only hand, our private foreign invest¬ private importations of goods and /many learned ment position in 1956 showed that half-success. Those who demand services or from private invest-,' -economists, of the total of $33 billion of hold¬ the benefits of a steadily growing ments jrbroad. There is, fo repeat, ;and others international, economy cannot at ings, 37% was in Canada; 28% in no7 inherent ; reason ' why /also/had been they the same time insist on remaining Latin America, and 21% in West¬ convinced that should not expand steadily in the ern major sources of instability and Europe. This is, hence, not Per Jacobsson a future; setback in This is true simply be- ; greatly unlike the merchandise disruption; and those who wish to : cause there is no : ' < the American necessary limit sell cannot at the same time re¬ import distribution, so far as con¬ to the future growth of world de¬ economy would expose other cerns Latin America and Western fuse to buy. The only substantial countries to a strain in their bal¬ mand, and hence, of world trade. Europe. For Canada, however, the exception that seems to me plaus¬ ance of Rut no large and continued ex¬ payments and, indeed, in¬ proportion of our total investments ible is the protection of new in¬ pansion of the private supply of- dustries in backward countries. tensify what had been called "the was half again as large as the pro¬ dollar shortage." dollars to. other countries is likely For the Euro¬ But even here I think that the portion of our total imports. to take place unless appropriate' pean countries this could be a protection, to be justified, must The geographical of policy' decisions are reached, botli* be set up only as serious matter; a number of them part of a care¬ our government expenditures, in the United States and had already experienced two pe¬ abroad, fully planned and specified pro¬ riods grants and loans has been quite arid unless of acute tension in their the appropriate imple¬ gram, and then only for a speci¬ different. Roughly half of the menting measures exchange markets since the sum¬ are adopted fied and limited- time. The grand total was spent in Western and maintained. mer of 1956, and if they now had burden of proof is on the wouldEurope, and nearly a quarter in to look forward to another period So far as concerns the United be protectionists. ? the Far East. The Latin American of exchange troubles, they were States, these decisions and meas¬ proportion, as the countries con¬ ures ■y Finally, it is obvious that those naturally inclined to be worried. depend on what we think the countries which... seek American cerned have not failed to point The British especially, who had majors objectives of our national capital must also provide the out, has been trivial. The distri¬ been foreign economic policy should be. taking strict measures at legal and economic conditions bution of government outlays re¬ or grave reasons , , . seriously to believe in any immediate threat to the world's liquidity position/' Mr. Jacobsson, nevertheless/ advances several reasons supporting an increase in the Fund's resources at this timfte. Included amongst these is the argument that it might make countries more confident to take the step towards convertibility. The distinguished international econo¬ mist argues against gold price increase; points out that little orir imports, which still take place - Liquidity By PER JACOBSSON* means reached. Objective furnishing two-thirds of the total private dollar availabilities per year, as against pies) 2.4% the be can chief prove still further our domestic im±r. anti-recession policies, in order to of'$273 billion, Imports of services Private^ investment/abrbad 11%; which the are ■ annual average dollars selves international new Its volume, however, is not likely to be large. 1 ,v ,/ Finally; by far the most impor¬ tant single, source of supply of dol¬ lars to foreign countries, of course, is and will continue to be our pri¬ vate imports-of merchandise. • At ports by < probable, perhaps/ through the present and proposed the The also institutions. International tained, but be steadily increased. considerable a 23 two, inherently requires supply of our dollars to other-countries be not only main¬ abroad should pot be main¬ tained last that the why this present rate of private invest¬ period, on the average, and even increased. Third, some expansion of the foreign investments of our govern¬ lateral the wars, reason (2215) posals been made; and why is it that these pro posals have received almost universal approval at a tirtie when nobody seems seriously to believe in any immediate threat to; the world's liquidity position? Before I questions, try to answer these let me for a moment ( - - recall how the problems of inter¬ national liquidity were success¬ fully dealt with in the days before 1914, when almost all countries adhered to the rules of the inter¬ national gold standard. The gold , , , standard system as it worked before for" the secured 1914 - world the following two advantages: Reviews Pre-1914 In the first iri tive the maintaining between ; the ance various System place it effec¬ was bal¬ proper economies countries. in If of the . (^tribution flects, of course, the regional im¬ pact of the major international political, military and ideological pressures since World War II. ■ - t . ■ - • " •• - - v ... " - \ *'•' ' About What about seems it to pressing, me guess the Future? : the future? First, fairly safe, if de¬ that the volume of a our military grants and other ex¬ penditures abroad will not shrink much in the next few I believe that these objectives years, and more possible another, or this tion for most of is the justifica¬ jsome industries governmental our countries alone, most of which are actually spent in the United States, they make no direct addition to of dollars available to investments our pri¬ have abroad grown relatively rapidly in recent and since 1953 have been tive is the bers promotion of internal the of world. so their restore financial discussions with their uncommitted audience well know. very different what had to been feared; instead losing reserves to the United States, most European countries, of and also some countries outside the products and the which in one way or an¬ Europe — notably Japan — have other have benefited from gov¬ been able to increase their gold ernment favors that were not and dollar holdings quite substan¬ are But so tially, while the United States on far as concerns the United States, the contrary has had to sustain a the damage to particular segments gold outflow of about $2 billion. of our economy, for example from Fortunately the United States has the removal of tariffs, can pre¬ still very large gold reserves, and available as are certain to get markets have been groups Achieving this ob¬ it concerns coun¬ far which tries this of These development and di¬ abroad, ■ especially though -not solely in' the eco¬ nomically, more backward areas jective, are especially by more liberal commercial policies—as the mem¬ versification' vate to into enter hurt, economic already rather highly developed. Moreover, so far as the funds are Second, home reasonably sonable share of the fruits if the American friends about the inter¬ broad arid general terms, are by investments are successful., national liquidity position, with a now fairly well agreed to by al¬ All these < things follow obvi¬ view to finding out whether some most everyone. The first and ously enough if we 'accept the overriding objective is in itself original premises, from which the safeguarding measures could not political: namely, the containment analysis started. The steps pre¬ usefully tie taken. of imperialistic Communism, and scribed are not all Looking back, we now know easy, however. if possible its defeat. In one form Some products, some groups, even that movements in the exchange spending abroad, and needs no amplification. The second objec¬ thb supply investments position, began to be anxious, and will make it they considered it' necessary to enjoy a rea¬ at least when stated in probably will expand., As in the past, however, the spending is likely to be concentrated in a few other countries. our which for us to and secure, , 1 What which will make Furthering Our Foreign Policy or which may waver in the struggle between the' Iron Curtain and the most to people. sumably be largely avoided by with other industrialized countries spreading the changes over time. gaining reserves, there are not at On balance, the gains, both to the the moment any signs of an im¬ American people at large and to mediate liquidity crisis or any real our friends abroad, must surely prospect of any such crisis in the far exceed any losses that prove foreseeable future. I think it is of the recent investment has been for progressively raising the in actual fact to be more than fair to say that, at the recent direct, and some 40% of it has •standard of living and the whole temporary. In our own enlight¬ meeting of the Fund and the Bank been going to the less developed level of life in other countries. ened self-interest, I think we iri New Delhi, the representatives countries outside of North Amer¬ The third and last major objective musL make our basic decisions of the industrialized countries in ica. In th^e absence of major po¬ stems directly from these latter along the lines I have just been Europe and elsewhere were more years, West, is part of the require¬ averaging nearly $3 billion a year ments for'achieving the first ob¬ -—though this is still hardly 10%, jective: It obviously has great of our recent total yearly supply force in its own right as,twell, of dollars to other countries. Most however, as a major instrument 9 Data from U. S. Department of Com¬ for 1946-56, Balance of Payments merce: (1958); for 1957-58, Survey of Current Business. Of the gross to*al "f *">13 billion, $21 billion represented military supplies and services bought in the United States and transferred under a motivations. of It growing a lateral is the volume commercial promotion of multi¬ sketching, and then courageously. For grants. desirable from to the some gross it purposes subtract total, these 12 If inflation in the United States thus may exchanges with all other countries ' reducing the _I0 The dise We to distribution of exports was not had a substantial Western excess of Europe, imports and roughly and for the an merchan¬ eur greatly different.' of excess however; exports an equal from JLatin America; balance for Canada evenr aggregate of all other tries. coun¬ while to V it than current lasts; but dollar it is avail¬ hardly recommended. be ' objectives, and especially of Joins Channer Staff of > rate increase course a rapid more will abilities The achievement of all three of these this a too latter to $252 billion. For the purposes the following argument, however,- the effect is in either case minor. runs abroad, at them, at high levels of employment and without inflation. be transfers them financial and > that desire carry out II As of a further example of the orders magnitude Involved, doubling the cap¬ ital uts of of the World gold and -dollar the made annual total Bank wottld resources of increase by osily 3% dollars now being available in other ways. The Bank's are of great importance both strategically and in the localities af¬ fected, but they are not large in relative operations terms. : - (Special to The Financial Chronicle) CHICAGO, 111.—Paul G. Mar¬ tens has joined the staff of Chan¬ ner Securities Company, 39 South La tens was Salle Street. Mr. Mar¬ formerly with Boettcher and Company. relaxed than they had been at any previous meeting of these two in¬ stitutions. But even so, the dis¬ cussion about the world's liquidity position has been continued; and —what is really significant — at the New Delhi meeting the repre¬ sentative of the United States put forward proposals for an in the resources increase of the Fund and pursuit of too lax a a credit policy particular country cented rules restrictive increase to rates count and Bank. *An the Why have address American by these before lind Association of Nov. 14, 1958. Mr. Jacobsson Finance Association the Metrepclitan Economic New York, New York City, pro¬ its dis-^ other take check or reverse the flow of gold. Since world trade was generally ex¬ panding, it was often sufficient for a country to call a halt in the credit expansion to get into line measures 1 The again. doubt measures harsh world to v wer2 bu. times at trade no since expanding they generally did not cause more than passing hardships. was Secondly, the regular flow of gold from current production led to a general increase in monetary which in its turn gave impetus to expansion i i the reserves, an supply rule credit, sufficient as a provide the inceae in of to purchasing power and working capital needed to finance the growth in trade and proclu tion. The Swedish economist, Professor Gustav on laid Cassel, great stress mined gold the role that newly played in securing an ado ;uate expansion in the financial a ruc- ture; he arrived at the famous figure of 3% as the rate of ex¬ pansion required. In some p riods before 1914 this rate was ro1 fully in other periods r was exceeded, but t1 e di¬ reached, somewhat vergence with the price never result that was level take we the general relatively 1860 to 1914. was in the period If con/'Ie -able, look a at stable the re¬ individual countries, we find that had quite substantial gold r~ serves serve holdings which went of on the increasing from to year; others—particularly Great Britain — had w^rt we year would now slender consider aston'shingly gold .£30 million reserves—~ily or some $150 milii m when highest fc- any One reason whv m main¬ tain orderly monetary conditions on such a slender gold has"? was that Great Britain at the t'n e was they were pre-1914 London a the year. could manage pronounced creditor cou it\y and precisely had su's antial more short-term claims on the out of went lirie it would lose gold; and it was then bound by the generally ac¬ other cou t- tries—largely in the form of ac¬ ceptances— which could readily be mobilized. Another reason wi" Continued on page 24 24 "The Commercial and Financial Chronicle... Thursday, November 27, 1958 (2216) Continued from page effectiveness of British the banking system, working with a traditional 10% cash ratio; in such a system only a relatively slight to reserves was needed addition for credit to fce expanded in an effective way. As between the in¬ dividual countries the proportion between the gold reserve, on tion the eftded, both the dollar was and the so-called gold block cur¬ hand, and the credit volume or the volume of foreign trade, rencies—including the Swiss franc —had also to be devalued. There on the other hand, thus varied are a few observations which I considerably. Both for the indi¬ would like to make in this con¬ vidual countries and for the com¬ nection. munity of nations the efficient working of the credit system was Little Gained by 1930s a factor of the greatest importance. Devaluation Just as the liquidity of an indi¬ It is often asserted that the real vidual firm can never be judged season for the devaluation of the on its cash holdings alone, since account must be taken of its credit pound was that the British au¬ thorities had in 1925 stabilized standing and its borrowing possi¬ their currency at too high a level, bilities, so the very fact that the international credit system func¬ namely the pre-1914 gold parity— so that it necessarily had to be tioned smoothly under conditions of widespread monetary, confi¬ adjusted iii relation to other cur¬ rencies. But when the whole dence made it possible as a rule for individual countries to borrow process of adjustment was over, when a deficit arose in the bal¬ by the middle of the 1930s, the ance of payments,; so that they pound and the dollar as well as most other currencies had again would not have to rely solely on reached very much the same rela¬ their reserves at a period of strain. tion to each are still lessons respect three main to be learnt indeed . valid the fore to Learn Standard Lessons There other as existed be¬ devaluations, so in that hardly any real change it not then occurred. Would had the pre-1914 have been better if the original relationship had been preserved? gold standard: there is need for After all, little was gained for the monetary discipline to ikeep - the by .these devaluations; various economies in balance one wprld world trade remained stagnant; with the other; there must further throughout the 1930s, notwith¬ be a mechanismsufficiently effec¬ the resort to cheap tive to assure.-the expansion in the standing credit supply* needed- to sustain money policies and deficit spend¬ the growth in trade and produc¬ ing pursued in most countries. In fact, some serious efforts tion; and thirdly, in order to im¬ were made in 1931 to support the plement these prerequisites and thus to assure. a properly func¬ existing exchange structure when from the working of „ international* monetary tioning standard there must be an effec¬ tive international credit system. it under came credits pressure. arranged were of total Swiss about Special to up francs a five . billion Importance of Commercial Banks value Indeed, foreign as well as do¬ mestic trade is. financed primarily by commercial: banks and it is the supply of commercial credits that keeps the wheels of commerce moving. The liquidity generated in the financially important coun¬ tries is therefore of special impor¬ $1 billion which in real or would $2.5 tance the for trend of world trade—to give but one example— and an example from our day— be qual to at least billion today. These credits, we know, proved insufficient as but this does not mean that a larger amount of credit, perhaps twice as much, would not have been successful in averting the devaluations — and in doing so of the subsequent troubles, political as well as economic, might well have been averted. many world and has thus facilitated in¬ ternational settlements. But in mercial banks credit, the com¬ the support need of the central banks—here in the United States of the Federal Re¬ System—and such support only be-granted if the central serve can banks themselves are in a suffi¬ ciently strong position. Situations arise — in emergencies, in may booms and in depressions—when the central banks temporary need such of course, are assistance in need of — and assistance was, Winston Churchill has the of it could easily be turned into money most countries with excess sources so left liquidity in their domestic mar¬ kets in the postwar period of re¬ construction. This excess liquidity necessitated important some — had to close its doors; how the nervous¬ ness which this created spread to Germany summer crisis within and to in a gave rise in the banking country; how then few weeks the pound a very severe that For had which the Fund has granted as¬ the form of its uncommitted re¬ There are indeed some strong that today it would not arguments for contributing to an again be possible to extend as¬ increase in world liquidity, when sistance on such a massive scale such a contribution is required, by as ad- was received by Great Britain. Reasons for Increasing Fund's Resources means of an resources; increase in the Fund's the financial through assistance the amounts made avail¬ able by the Fund are pinpointed So, when I, now turn to the to particularly weak spots in the i ncrease question of increasing the re¬ number monetary structure, and are thus ments also took the form of de¬ sources of the Fund, one of the used to prevent cracks. Secondly, principal reasons for such an in¬ the funds are made available at a valuations. Often one crisis fol¬ lowed the other—notwithstanding crease—but by no means the only time when they are most needed the aid from abroad—but after 10 one—is to be found in the general —which may be in times of boom interest of avoiding devaluations years of postwar reconstruction, as well as in times of depression. two important results had un¬ which are not dictated by the As a matter of fact, the greatest realities of foreign trade and com¬ amount of Fund assistance was doubtedly been gained: (1) by 1956 the European economies had petitive prices, since experience made available in the boom years fairly rapid in prices, although in a of countries the adjust¬ generally reached a a fair degree of balance internally and in relation to each other and to the rest of the world; (2) by that time the adop¬ shows that is once difficult to a crack starts it limit its 1956-57. The Fund has in fact of effects. shown that it is prepared for di¬ However, in this connection, it is verse contingencies — many of important to remember that the which cannot be clearly defined tion of flexible credit policies (in¬ British cluding changes in interest rates) had generally been accepted as an very Government itself took in advance. Thirdly, the Fund will including an help to ensure that degree of fi¬ increase in bank rate, to 7%— nancial discipline, without which essential element in the efforts to which is an unusually high rate no international monetary stand¬ in times of peace. In other cases maintain a balanced position. ard can function properly. where the Fund has granted fi¬ May I add some further con¬ nancial assistance corrective meas¬ Suez and 1957 Crises siderations which argue in favor ures have also been taken by the of an increase in the Fund's re¬ Both these gains were put to a countries which received the as¬ The balance which has Severe test at the time of the Suez sistance; and the policies which sources? crisis that occurred in the autumn the countries in question intend to beep restored by, the economies of various countries, taken together of 1956, which, in particular, ex¬ follow have been set down in dec¬ with the recent improvement in posed the pound sterling to a con¬ larations to the Fund, often tak¬ the reserves of most industrialized siderable strain. The pound being ing the form of comprehensive countries, has naturally again a currency used for international stabilization programs, as recently raised the question whether some settlements wasvparticularly vul¬ in the case of France* Brazil and further steps .could not be taken nerable in a period of nervous¬ Turkey .J In these and in some in the fairly near future to restore ness; those who had claims on other cases, the resources which the convertibility of currencies, at London asked for immediate pay¬ the Fund: has provided for the least of the leading countries. The ment, while those who had pay¬ support of their programs have possibility of having recourse to ments to make in sterling delayed been supplemented by credit fa¬ the Fund's resources—as a second as long as they could the date of cilities, largely of a more long- line of defense—may make coun¬ settlement. Britain's gold and dol¬ term character, obtained from tries more confident to make prog¬ lar reserves were rapidly reduced other sources—from U. S. agen¬ ress towards convertibility, and by these capital movements, al¬ cies, the European Payments may, indeed* induce them to take though the current account of the Union and, in; a few cases, also Stricter and more constructive balance of payments continued to from New York banks. measures than if they had to rely show a surplus. In December, the The principles and practices on their own resources alone. At British Government turned to the Fund with a assistance for request for financial credit an strict measures, which govern the granting of fi¬ nancial assistance from the Fund amount of the New Delhi Conference, the British Chancellor of the Excheq¬ of ranged , change markets—this time caused Pre-World War II Years particularly by rumors re¬ why the Bretton Woods 'institu¬ After the gold standard had garding a possible revaluation of tions and especially the Interna¬ broken down in the inter-war wxe tierman mark. In September, tional lyionetary Fund were es¬ period, something new and more 1957, when the crisis was at its tablished. firmly founded had tq be built height, the Bank of England raised Before I turn to the considera¬ and that was the task at Bretton its discount rate from 5 to 7%, tion of the problems that now Woods. The International Mone¬ while the Deutsche Bundesbank beset us there is one important tary Fund in particular was estab¬ lowered its rate from 4^ to 4%, phase of the inter-war period lished to ensure a better order in and declarations were made at the from which, I think, we still have monetary relations and to do that Fund Meeting in Washington to a lot to learn. I refer to the phase by granting, in case of need, fi¬ the effect that there was no inten¬ which led up to and followed the nancial assistance which would tion to alter existing exchange suspension of gold payments by help the particular countries to parities. These measures and dec¬ the Bank of England in Septem¬ take the proper steps to restore larations impressed the markets, ber 1931. I suppose some still re¬ balance both internally and on calm being restored; from October, member how in May of that year their 1957 up to the present—for 13 foreign accounts. It was the largest Viennese bank — the specifically laid down that the consecutive months—Great Brit¬ Austrian Credit Anstalt overcome. as has reduced j ustments, which for the most part look led, $500 million was ar¬ towards requests for drawings or convertibility of the pound, which with the Export-Import stand-by arrangements depends is our objective." Bank. The assistance by the Fund not Upon the absolute amount in¬ Secondly, it is an important fact was granted on the basis of a dec¬ volved, but upon the proportion that the world's trade has risen same about the devaluations of laration by the British Govern¬ it bears to the country's quota considerably in volume and value 1931 and the following years but ment that strict financial and (each country has a quota in the in the postwar period, with the I still think they could have been credit policies would be pursued; Fund which determines not only result that whenever periods of avoided: and if they had been that quantitative restrictions its contribution to the Fund but nervousness set;in very consider¬ avoided, much of the trouble that would not be reimposed; and that also its voting power and its pos¬ able shifts may occur in the timing followed in their wake would also the value of the pound sterling sibilities of obtaining assistance). of the payments between the vari¬ have been avoided and perhaps would be maintained. Thanks to Requests for drawings of the first ous countries; therefore, in any even the war itself. the policies thus pursued, and the 25% of the quota, normally corre¬ emergency, or even in any period I have dwelt at some length on financial assistance obtained, the sponding to the country's own of exchange tension, the move? this liquidity crisis of 1931 be¬ crisis was averted and the value gold subscription, are almost auto¬ ments of funds that will follow are of the pound upheld. cause I am haunted by Santamatically approved; for the next likely to be on a large scale. The yana's saying: "Those who do not Nervousness persisted however. 25% the Fund's attitude is a lib¬ rise in prices by at least 50% since remember the past will be con¬ In the summer of 1957 a new ten¬ eral one—the members being re¬ 1946 has reduced the real value of demned to repeat it." sion set in on the European ex¬ quired to show that they are mak¬ the Fund's resources, which are of the main reasons one crisis should be $1,300 had already been laid down by uer, Derick Heathcoat Amory, million, and received a drawing of the Board of Executive Directors stated at the Fund meeting that $561 million, and a stand-by of before the active period started in the strengthening of sterling had said $739 million. Moreover, a line of 1956. The attitude of the Fund "brought us still nearer to the expansion in the United about the second World War that States during the'recent recession it was .the most unnecessary war has helped to increase the supply in the history of mankind. I would of dollars also to the rest of the not go so far as to say exactly the the credit order to expand was happened in 1931, to an sistance has been in relation to alteration in exchange values, no¬ underdeveloped countries, which body could have told what the have had to satisfy the Fund as well as the other institutions from consequences might have been. these needs were thus met from At the time of the Suez crisis which they have requested assist¬ came under pressure and the other sources, there was little the Fund was able to grant sub¬ ance as to the soundness of their flight of capital became so intense necessity for Fund assistance in stantial assistance to Great Brit¬ programs. I believe that with the that in September, first the pound those years. ain because its holdings of gold enlargement of- the Fund's re¬ and then a number of other cur¬ The combination during the war and convertible currencies were sources there is no desire or inten¬ rencies were devalued. Thu£ a years of direct controls to keep at that time still almost intact. tion to depart from the principles crack which had begun in a rela¬ down prices and the generally This was, however^ the beginning which have thus been laid down. tively small country went on rapid rate of increase in the vol¬ of a very active period for the spreading; and before the disrup¬ ume of money and of claims that Fund, and the assistance granted States Fund's Policies one Gold it upon programs International Liquidity the possible to embark of postwar recon¬ structions without being unduly hampered by a dangerous short¬ age of foreign exchange. Since war, 23 Fund was facilities tion or not intended to provide for postwar relief. reconstruc¬ Nevertheless, thanks .more ain has been able to add to its re¬ serves. All this points to the fact ing reasonable efforts to solve now considerably less than was own problems. For any envisaged when the original en¬ beyond these limits, dowment was made. In fact, an however, substantial justification increase in these resources by 50% is required: namely, that the would merely give to the Fund the drawing must be in support of a same power of action that was al¬ their drawings program likely to ensure lotted to it at Bretton enduring stability at realistic rates the moment the Fund's of exchange. It is largely through ted resources in gold the application of these principles dollars amount to $1.4 sound that the Fund is able to contribute to the observance of a degree of At uncommit¬ and U. S. billion. By increase of 50% in the quotas the Fund would obtain an addi¬ an tional amount in gold and U. S. billion; it also therefore just an additional source seems likely that drawings of some of the major currencies which are of credit, but is recognized more and more as a source of credit not yet fully convertible will be¬ that is available in substantial come increasingly attractive to monetary discipline in the mem¬ ber countries. The Fund is not amounts only to member govern¬ that have satisfied the ments that the pound was not over¬ Fund of their intention and capac¬ valued; that there was no funda¬ ity to restore balance. These prin¬ many overseas countries had mental reason for any devaluation; ciples apply to developed and fairly large sterling and dollar that it certainly was in the gen¬ underdeveloped countries alike; balances accumulated during- the eral interest that the exchange in fact, the majority of cases in to Marshall Aid and the fact that Woods. dollars of about $2 members. Thirdly, I should like to empha¬ ability to pro¬ size that the Fund's vide resources to countries in dif¬ ficulties benefits not -countries which have may just those sought or seek the Fund's assistance but Number 5798 Volume 188 . ,. all the members of the Fund. will be true in the future . The Commercial and Financial Chronicle This it has as that increase an the at rate of 3% per year would, over the next 10 (2217) 2ft here in this country has once again been only of short duration. World trade has not generally addition to On been hampered by new obstacles on hand, we find that the in the form of increased tariffs or addition to reserves from current import' restrictions, but showed By JOHN T. CHIPPENDALE, JR. sion in the exchange markets was gold production is likely at the considerable resilience in the face reduced in 1957, and that countries present price of gold to be at of a downward trend of business. The Government market is adjusting itself to the recent have been helped to push forward least $7 billion for the next Foreign aid has been continued, refunding operation of the Treasury which has been a successful with their stabilization programs; decade, even after allowing for and efforts have been made by the undertaking in spite of a fair sized attrition. The use of shortit is also in the general interest an increase in the present large Fund and others to extend finan¬ term issues in order to provide for the December maturities that by means of a stricter observ¬ gold hoards. Thus gold production cial assistance to countries in tem¬ appears to have resulted in a minimum of disturbance as far as as a whole will go far towards porary ance of financial discipline a sound the money market is concerned. difficulties, not only to It is also evident that, the meeting the additional require¬ permit corrective measures to take, monetary basis should be created uncertainty and caution which is so prominent in the money ' of for a renewed, expansion of world ments reserves, and some effect but also to enable them to market is creating a demand for the most liquid Government further addition may be expected continue their development. All V trade. obligations. This, has been, helpful to the Treasury in its new from increased dollar and sterling this has very largely reflected money offerings as well as its refunding operations. Discusses Gold Devaluation holdings of many countries. More¬ sound judgment and courageous Because the .Treasury is expected to take advantage of the Now I can imagine that some¬ over, the likelihood is that some action on the part of the authori¬ pool of short-term funds in its future operations, there is less of the countries which ought to ties in many countries of the Free body might say that although ah pressure on the longer-term bonds. This, in the opinion of some > increase in the Fund's resources is'' add to their reserves will not in World. And it is, of course, in the money market specialists, could bring about better price action » fact do and the result is interest of us all that the progress so, all to the good, there still remains in the more distant Government obligations. the problem of providing the regu¬ therefore likely to be that at least made should be consolidated and lar increase in liquidity required some of the newly mined gold expansion resumed. I think we Refunding Tailored to Money Market It was, for ex¬ ample, in the general interest that a devaluation of the pound ster¬ ling was avoided in 1956, that ten¬ been in the past. require years, an 'of about reserves Our $8 billion. Reporter the other Governments . 1 for expanding world trade. an It has already been said above that commercial banks to be able to increase their financing will have to be supported by the central will serves. sufficient re¬ regard the proposals to in¬ may gold price were never¬ theless to be raised and the annual the crease and ' the If • countries to diverted be which already have resources Bank a as supply of newly mined gold omies of the Free World. becoming available for monetary purposes were thus to be increased by added value and rising output from $700 million to, say, $1,400 is not then necessary to ensure a million a year the result might regular increase, from year to year well be that too much gold would A sustaining chair in psychol¬ in the reserves of the central be offered to the monetary banks* and is it not true to say authorities. One must not forget ogy at Yeshiva University's Grad¬ banks, but that these central banks a position to give that support only if they themselves are in a strong position. The ques¬ tion may-well be asked whether it The refunding operation of the Treasury was fitted to meet of the Fund the existing condition of the money market, and the fact that refunding issues went well is ample evidence that the has taken the December hurdle pretty much in stride. The shortest maturity was tailored to meet the needs of", the Central Banks, the largest holders of the December maturity. On the other, hand, the two year five and One-half month • note was not. long; enough to have an adverse effect on the more further sign of willingness and determination to give added strength to the econ¬ . the < will be in Floersheimer Grant for Chair in that the Fund cannot contribute such sustained increase in liquidity can be excessive, giving rise to further inflation if reserves; since its assistance is only of a short-term character—-being two Government repayable within three to five years? Would it; not be betters-it has further,'been asked—to raise the gold price so that, more sub¬ stantial contributions could be ob¬ tained from the current output of gold? that Psychology is indicated that certain holders of the December maturities who went in heavy for the certificates also exchanged some of their holdings for the new refunding note. It time to devote to them. staff of the Fund has ^his The summer stablished No Demand for The , The British Slender Reserves in Perspective ,. course, trade reserves to exceptionally was similar relation should be re¬ stored without much delay. But 1938 trade in was a a year would seem disturbed world un¬ suitable, for this and other reasons, that the credit volume countries these in could sufficiently to be ex¬ meet the dynamic world without any of them be¬ normal needs of a economy of stagnant a basis If 1930 for any comparisons. 1928 had been selected or Coast Exchange Members Election of Ted D. Carlsen, gen¬ eral partner of Woolrych, Currier & Carlsen, to membership in Pa¬ ing unduly hampered by reserve cific Coast Stock Exchange considerations. Although there is through membership in the Los therefore little reason to worry Angeles Division was announced about the Overall reserve the of world, working of the international credit other purposes — requirements system—that no year in the past which may be met by resort in can really be said to provide an case of need to the resources of appropriate basis for the purpose an enlarged Fund. If these safe¬ guards are provided, the basis of comparisons in this field. have should the An Adequate Gold Supply line Another of argument has been that since world trade may be expected to rise by something like 3% a year, central banks ought to increase their reserves by 3% a year also. But such a projection presupposes that those countries which already have large reserves should also con¬ tinue increase to rate. them this at We find, however, that in general many of these countries consider that they already possess all the reserves they need to give adequate support to their com¬ mercial banks, and to meet what¬ ever deficits may arise in their balance of payments. I am told that Western Germany want Venezuela — to one-half stock limits other such of of owner the monetary the applies to the while States is still the United of gold. consideration countries large* which reserves, over World's Free all those help to build up a sound world If one reporter on the trading floor of the Exchange in 1937, became a clerk on the floor for one of the trader for various securities firms in Los member firms and was a point out that the Free record in far been recent the financial unsatisfactory from years. World's field has There have in been formidable difficulties to be mas¬ The emergency after the Suez crisis was success¬ the results been? overcome, and so was the tension on the exchange markets fully which became summer the more not cies of so 1957. there in acute There confidence in most than entered the securities business in He was princi¬ Nebraska in 1935. a securities firm in Ne¬ braska prior to moving to Denver pal in Before I finish I should like to to one which activities other economy. have established for entered the securities business as a of intelligent credit Angeles prior to becoming asso¬ policies under which sufficient ciated with his present firm in liquidity can be generated to keep 1958. pace with, and even sto stimulate, Lee A. Huey of L. A. Huey & the growth of world trade. These Co., Denver, Colo., has also been are developments which are im¬ elected to membership in the Los portant even in a much wider Angeles Division. L. A. Huey & field for they form a prerequisite Co., 1 Equitable Building, Denver, for more confident long-term in¬ Colo, was organized in 1953 bv Lee vestments, and for the pursuit of A. Huey, President. Mr. Huey nor at all to their present reserves— and I believe the same been sen pursuit tered, of both a political and an add economic nature, but what have Switzerland neither have well been } taken • The Discount Procedure of Interest position by Frank E. Naley, Exchange safeguards must Board Chairman. The firm of Woolrych, Currier instead, the present reserve posi¬ nevertheless be provided for ex¬ circumstances of an & Carlsen has offices in San Diego tion would appear in a much more ceptional favorable light. But so many other emergency nature, for assistance and Los Angeles and the other factors have to be taken into in the implementation of stabili¬ partners are Edmund H. Woolrych account—among them the proper zation programs, and for some and Warren Currier III. Mr. Carl¬ as would . high, and they then contend that panded a issue of the Government debt. a when the relation of world an owners of the maturing securities. It is well known, of , that the Treasury is most anxious to extend the maturity. " of Mr. Floerdocument entitled "In¬ the old gold standard before 1914, ternational Reserves and Liquid¬ the British banking system was sheimer is W. D. Floersheimer ity" in which these problems are able to expand credit sufficiently senior partner in the firm of fully discussed. Here I can only on a relatively slender gold basis. make a few brief remarks. Now that the leading countries Sutro Brothers & Co., New York Those who advocate an increase have relatively ample gold and City. The chair will bear the name of David F. Floersheimer, the in the gold price generally take as foreign exchange reserves—espe¬ donor's father. a starting point a particular year cially after the recent improve¬ in the past, say the year 1938, ment in the British position—it published confident that such by the Belkin, Presi¬ dent Longer Issues Treasury in its, December operation kept ments, It seems logical to assume that the Treasury would kave /used. n- longer-term obligation in its moat recent refunding j^ it was the beginning of this discussion that in the days of-university. I mentioned at the the , Dr. Samuel / fact that r to the near-term end of the list appears to indicate that there is still a lack of interest in the more distant maturities of Govem- . These are important questions, and I could only wish that I had more e . The short refund- ing note appealed to those- investors who were not so much in- ~ terested in the certificate which was offered in the package deal. • uate School of Education has been through an initial gift of well be held that gold will retain $50,000 from New Y or k its usefulness as a currency basis (and not lose it like silver did) f i n a ncier only if. it remains sufficiently W alt er D. scarce to be well sought after and Floersheimer, it was an¬ willingly absorbed. nounced by obligations, in spite of the minor market weakness which developed in these securities!. costly and difficult countervailing measures are not taken. It may to any Government distant * was is the now curren¬ only a few finds years ago. Moreover, the recession and organizing his own firm. L. A. Huey & Co. is the fifth firm head¬ quartered outside of California or New York that has recently ac¬ According to certain money market specialists^ the interesting part of the last refunding operation was the fact that the Treasury was willing to offer securities at d discount. This Seems to mean ' that the Government does not want to push the coupon rate up, in spite of the firm money market. By offering securities at a discount a lower coupon rate can be used. This is a development ' which should be watched very closely and the new money and refunding operations that will have to be undertaken in. 1959 will tell whether this discount offering of Government securities is just a one-shot situation or something that will be used mbre > extensively in the future. The introduction of the twenty-six week Treasury to indicate that the Government is - Lorenz have and Colo. — Thomas Robert F. Maul, B. . "Worst Enemies of Fixed Return Securities" The new fact money should not have an unfavorable & Christensen, Seventeenth Street. Inc., 724 influence On the more . distant the bond market. on . - ... , issues, in spite of the apparent lack of interest in these securities. The inflation fear and the inflation psychology seem to be the worst enemies of fixed income bearing Obligations, and there is not likely to be very much of an interest developed among buyers for these securities until there is some lessening in the strength of these forces. It is quite evident that if there should be a further upsurge in the inflation bias, there will be higher interest rates and tighter credit conditions, which will mean the pressure will increase • ; that the Treasury has confined its refunding and raising operations to the near-term money market ■ the and Future Planning Appoints A. P. Parker United Life States Company surance from 1954 . . ; - ► In¬ to date. t Arthur P. Parker has been ap¬ pointed National Sales Promotion Manager of Future Planning Cor¬ poration, 350 Fifth Avenue, New York City, it has been announced by Karl D. Pettit Jr., President. In' his new post, Mr. Parker's duties will include the overall training manuals for methods Future Mutual Life Philip Dresdner is ciated as with now asso¬ registered representative Burton, Dana & Co., 126 Broadway, New York City, mem¬ bers of the New York Stock Ex¬ change. Hooker & Fay Adds REDWOOD, CITY, Calif.—Ben¬ jamin C. Chapman, Larry K. Hat- A veteran of the life insurance sales training With Burton, Dana K. and Planning Jr. industry, his background includes joined the staff of Peters, Writer • the need for liquidity. The sale of Treasury issues to corporations does not increase the money supply and this is one way in which the inflation potential is cut down. . salesmen. {Special to The Financial Chronicle) DENVER, bills seems this short-term upon courses, Two W;th Peters, Writer use these buyers of Government securities are now in a position to make commitments from a week to twenty-six weeks depending quired membership in the Pacific supervision, developmentand Coast Stock Exchange. preparation of sales training i going to sector (bills), for the raising of a fair amount of its new money. This kind of financing is made to order for corporations and activities with The Insurance Company of "New York from 1927 to 1954, lett, Stuart W, Thomson,. John Inglis, Jr. and Robert K. Bourne have joined the staff of Hooker & Fay, 723 Middlefield Road, w 26 The Commercial and Financial Chronicle (2218) We See It | As must tures and to be devoted .. p in any event, become unduly optimistic about the national fiscal outlook. The President has had - r . . ,. i If ,i only there was a number of the members of his own party. The fact is though that nowhere, or virtually no¬ where, in the President's Administration or in his party is there readiness to drop or even to make sharp reductions in the activities and the functions undertaken by the Fed¬ eral Government, and drastic measures are absolutely required if a of just this sort position of financial soundness is to be reached in national affairs. It is not only lack of efficiency in operations, but it _ 5 .... from page^V^ ^rv 'y' ' - 1 y " > - - r Growth of Employee Benefits And the Trend of Inflation package.'- frilled-up we have now ... i, , their future size While decrease. Labor Statistics will V of attempts to allow quality of dif- . ferent products in determining. purely price changes, it cannot do so completely; Accordingly, any tendency for the automobile package to stop growing will to some extent be reflected in prices, 'for 4,699,000, force public is vitally concerned about have than in the an advocate of somewhat greater moderation virility of the ailment. 1 The Record : third been include would such items rent turn to the record. In fiscal 1958, more than a us dozen years after the end of World War II, and a half decade after President Eisenhower succeeded in bringing active hostilities in Korea to a close, expenditures for veterans' services and benefits totaled around $5 billion, amount larger than for a number of years past, and twice as large as prudence and fairness would suggest. Mere tinkering with this sum to bring it down a billion or so is not the remedy we must have. In an certainly one 1941 with all the scandalous bonuses and the like follow¬ ing World War I, the figure No one, of course, was only about would want to a dishonor half billion. or doctors" fees, as they could do for themselves simply is not in accord with prudent management of our affairs and is not fair to the rest of us who must meet the bills. 'Xabor the cost of medical by 53% well over with which be four and a substantially Index these and in we could well do without. Are these amounts sort of status? It would more any total. items tend to a to by greater However, slowly move considerable extent the persistent rise in'these items the level of 1939. double shows ready siderable part made of rise in the of the and on that the may : a middle of the road certainly be surprising if general price level, look tor for the declines next year in be rate. than this is to The rank and file should consider what it would be like should such abnormal functions be eliminated from the programs of the Federal Government, thus making it possible to reduce income taxes to something approaching reason—to cite only one major advantage. Few realize probably what these excessively high and progressive in¬ come rates are doing to the incentives of the younger men at the start of their careers, many of them possessed of ambition, energy and capabilities akin to those of earlier generations who built the railroads, and the huge manu¬ . United; -States war,,period have -*■ been: instruIf there were mental. i- in i Starting individual : itself has .contributed, particularly in the reports of the it was slow to act in rovers- Council of Economic Advisers its early money ' policy ^s nnd the studies and hearings by the ing vecoverv really- ernment; recession -had At way. from the .sanxe the ;J°int Economic Committee.. r .Whetl»r .tecause of the growing. 1954^^Recession the .. over the increased until April, 1955. weight ot'public opinion, the pres- • hand, iriTthe, most recent recession, the Federal Reout--serve raised the discount'rate in con- "?e[fes °l,S^h^^as^soe^Uy in thP auto in^fftrv—or ^c1<rldustry for some other reason, it is a On the other and ana xooa, the or two fnr tor is areas, at at lnacf least suc,h a5rent> medical_care, utilities ' ' . n ± August past u -i fu peak of ?i the the longer term point of view, there has been a gradual but perceptible shift in attitudes toward the Many of us inflation can almost oxxuvon everyone cvvijviit great States into serious there as we Ours great was experienced was mature a a United lapse would as was the depression such upon there that concern still looked economy question and about whether there would be sufficient outlet sorb for new investment to ab- the made and saving that would be high level of income employment. This concern at a that vuww to . a kj uourtoo mark^- the first act when it. was on wiiiinimp«e' Our Willingness, to Stop innauon •" . - wage costs face of the it co be- does, not, on tne tace oi it, go oq y0nd the amounts that could nor- mally be pfovided through growth rate beginning in mid-August, *i this year, only four months after the low point of the recession. ,5. * major settlement „was. which the increase in con- in productivity. The basic settleprovides for a 2Vzc annual incre3Se in hourly wages over the ment Skilled techni- next three years. - - . cians receive a larger increase, ^ this .g offget by the fact that This willingness to; hold the. company contributions to the supmonetary reins tightly while /the ' piemental unemployment benefit business recession was beginning are scheduled to continue at in 1957, and then to tighten, lip quickly again this pasL-supimer the though unemployment was at the highest level witnessed in the postwar period, reflects the great concern of public officials and the public generally w^th.ineven flation and indicates a same rates as previously, Thus, direct wage costs apparently wiii 'not rise appreciably because 0f the increase in benefits to be While, we do not know for certain to what extent the Ford paid. ness to run risks of settlement willing- will set a pattern for other deflation that is depression, growing out experience of the 1930s, was years ago. I do not ;cite this in in the language of the any critical way whatever — I Employment Act of 1946 and in approve of it. But it is an indithe general unwillingness of pub--cation that we are taking bold to would take .any. action steps* in the area of public policy risks of to hold down inflationary forces. Not only is there a difference unemployment and run any precipitating plunging our supposedly delicate in attitudes toward $he inflation- very a sibility that the wage-price cost- reflected officials between Workers ind Uthe%„tdU"reCompany a* i business* industries, I do feel that it constructive developof would have been unthinkable:ten iment which holds out the jios- with which agreement An+nmnhiU the lie recentlysi!_,ned * in was. under .w^..-Co^ in a' pat a'pattern-setting industry in" recall that at the of World War II end problem. the S and "Toom' ^ra three-year ^ vinced that business recovery was under way, raising the discount Longer Run Influences From 1.4.1 slighffy :fact , that b.y.. wbich.time « -as.:&SLto quick general price: level. , boom held it there until mid-November, MSm?Ye.^f.lyi.on..the breather in the upward course of the t aotuany 1957, the what0promLe7toeL somethineaof recesfon a a physical liquidityt allowing under time some- basic some food as as financial this abandoned of gotten rate thiee years have in the 1930s. great be expected for the time being at a was tributed importantly to the rise in the ot respect buyers for the bond .the 'rounds of the over-all postwar inReserve system'"stood flattbn. to supply the necessary However, in this area, too, the before serv- ; Thus, for items which or Reserve serve adjustment prices df most now what slower. past two With policy' in Ration process. Numerous privatemarket :Vpres-; "agencies havecontributed to this sures to affect interest rates. Then,? gr.ovving understanding and I be-: jn the 1953-54 recession,, the Fed- heve the activities of the Comeral Reserve was quick lb act to' hiittee for Economic Developease the money markef^Selually '-ment-.r have been especially but beginning in the springi: of 1953, noteworthy in this respect; Gov- has from basic sit- inflationand "the uation . favor distance to : go yet, recent changes suggest that a con- ices acSptVeasu^ credit. This, of course, was a very public is becoming more informed* inflationary action, and it was no.t. on the nature of the wage-price until 1951 that the Federal Re- spiral and its relation to the in- Medical some been after Federal than a , other no slightly smaller increase, being just, about, double the 1939 level, and residential rents are only 60% higher than in 1939. Thus, the catching up process for some items may have care " - policy.4-'"'Itrime-±;The Wage-Price Spiral inWorld3 War MI the W ' Paee-Setting Industries : - do was sell a Government Bond. reflects a>continuing .adjustment to the general change in price levels since prewar. For example, the overall Consumer more ' Reserve to in recent years slightly thn 'Ms .such -that their measures should emphasis* is.. per- ^effective." ; S -V?-% M• clearly iUustrated; in V ..vM MM/MM; most Federal than the 30% rise ih the Consumer Price more fnr ■* :conderiiingr There -remains only one area itself primarily with,. stabilizing that offers the possibility of being the prices of United £tgtes Gpv- a persistent source of inflationary eminent Bonds rather thqri thp pressures—the wage-price settleprices of commodities. Any time .Inents'in the pace-setting indusanyone needed money, all die ;had • tries which throughout the post- has risen half billion merely "trimmed" to reach deal care, and during the 1958 fiscal year. This, of course, was years after the President begpn to talk about greater sanity and commonsense in dealing with the farmers of the nation. Then there are the categories such as "Natural Resources," "Commerce and Housing" which are catch-alls for a number of programs to haps dry Federal and residential rents both 47%; such sucn Welfare," a heading which includes a multitude of sins, took not far from three and a half bil¬ lion out of the pockets of the taxpayers during the fiscal year ended June 30, 1958. This is a greater amount than has been reported for several years—and it has long been much too large. "Agriculture and Agricultural Resources" took as cleaning and the like. Since 1947. diately neglect veterans with service-connected disabilities, but this stub¬ born program of doing all sorts of favors for them which well as even and position of busi- < ordered£bm- -shortagesand private economy in and persistent is that involving serv- bat inflation. ices of various types." In this ' I ; The shift in Price Index is Let noticeable credit, ^tentir^ bn ^ Slid Of ^ ?5fhe Fed<^ -JJ £e aU in the1r^wef:to basis, the highest'ratioof unemployed for any month since the recession started. Rather, the justed level at rrerjerallv ness seasonallyM- 30% story could be told working,|apital - the.. 7.6%^ or a on the A consumer around rrprtit ; public officials consider it a of vital significance '^that SOme this, the money as v demand de¬ to a unemployment in August ^totaled; labor 1947 Wf®n ^ similar but matter for changes in the. in uct •.< today. Neither the general .public nor of (defined —.,45'%' of the Gross National Prod- Contrast this with the situation to Bureau The tend indicator plus currency in, circulation) dropped from approximately .,, . „ , a significant decrease in liquidity of the economy; As posits of depression. j, . , age of automobiles and that in the ■;; •• area find one supply .= economic machine into the abyss think reached the dinosaur . . -Some we the — large area In which inflation, and public agencies..with increases at the'consumer'means to restrain our robust more in' shortage we had 10 yeai's '. • !"*..<•./-Vy';. Similarly, in the financial , pnce point of fact the disease of loose fiscal programs had reached a- st age of rather advanced incipiency before President Roosevelt stepped into the White Hoqse, but it was the author and finisher of the New Deal who made a virtue of extravagance and financial irrespon¬ sibility—and, worse yet, set the pattern of popular think¬ ing on the subject/That disease is with us today, and there is as yet no indication that it is likely to be thrown off. President Eisenhower certainly can be described as no area any serious .—-———...... ... t recklessness in undertaking functions, that is the heart of the current fiscal difficulties, and has been since middle Thirties. In see were some _ utter day when Franklin Roosevelt launched his program of spending our way out of the depression of the early and goods equip- these shortages one difficult to is . Continued though that he has not given the slightest indication of understanding what needs to be done, indeed, must be done, if the dangers he speaks of—and others as wellare to be avoided in the future. Doubtless he would gladly this direction than ment. One by capital — fact is lopping off some of the extravagance now to be every budget statement. He might go further in durable business havebeen.eliminated and today ■« . of indication that real progress ; which there is a in store for,us in these matters! -.J*.U >>of the character one, fairly strong statements to make since the election about unnecessary spending and inflation. There is no reason to doubt that he feels just as he says he does. The .. . of . . satisfy the tax collector that the accounts are being correctly and honestly. : ; ' " * « _ found in . substan- were ^ consumer nf . some approve World War II there year handled Unduly Optimistic Ti. no tionary .than it was some years For example, at the close of ago. to record keeping and the riai^ y v .> jv-v riais, preparation of forms to indicate what taxes must be paid, - and drastically. Let each basic situation is itself less infla¬ which to the tax collector but the millions of manhours thing approaching it, by means of higher tax collection would take much steam out of moves to reduce expendi¬ Not depression question which is re¬ flected in public policies, but the facturing and other,, enterprises that have become com¬ monplace with us in this day and generation and which are the envy of all the peoples of the world. It is not only a matter of the funds that have to be paid out each year Continued from first page Thursday, November 27, 1958 ... push spiral- may inflation be checked. ' * : • _ ' Prospects for Stable Prices Best * In 20 Years : . All" in factors all, seems a to combination of be shaping up Volume 188 which Number 5798 makes it . . The Commercial and Financial Chronicle . to tendency for employee benefits to of increase* more > rapidly than thC holding inflation,; or of slowing it •' level of income; This is a longto : a very gradual ! creep, ; is/ term trend, which may have been brighter today, than at any time in accelerated by the development of the past, 20 yeabrs. v. unions and the greater willingness ; There is, of oourse, one major under war-time wage controls to thieat in the international politi¬ permit fringe benefits where an cal arena which could upset the equivalent amount in direct wage happy prospect of a-stable price .payments might have been con¬ level. I refer to the cold war be¬ sidered mOrC inflationary; but it tween the .East and the" West, has been a. persistent trend that which could break Out in a hot appears destined to continue. As war at income rises-in the future, fringe any time. However, I ac¬ benefits seem' likely to continue cept the judgment of the experts conclude that that neither precipitate reasonable the iprospect i . - : side will, knowingly increase in attractiveness to . "1 The Tucson Baltimore Gas & Electric Company East and. West does not become them.. Such meet and - / attitude also an areas. Besides . into would proportion, of those of college never but it. would that . be my guess the upward drift will something less than 1%" per age i : hydro some Vr ; Benefits In*' clOsingV X' would urge firms to bend every effort to explore the areas liri which they might derwrite rates, for ^the continue expahd its activities in this field economy is ; and wehave/every ! will! be /a , great service to the that they wiil, company, andto the people in your then: per family income levels will company. As -Mr. Cordiner said: rise to about $7,500. in 10 years, "The manager who/merely tries to something over $lO,OOO in 25 .to keep his plans and policies, up years and to about $15,000 hy the to date "Is already out of date. He ybar 2000. The year 2000 may must keep them up-to-the-future, seem; a long distance away; and .where the objectives of the busi¬ yet, the retirement benefits for ness will be achieved." which we are making: provision today will be being paid out at that time; Thus, if we consider that a pension of $400 a month is adequate today hi" relation to today's income level, we should BALTIMORE, Md. — Alex. recognize that'40 years from now, Brown & Sons, 135 East Baltimore when some of our people now employed will be drawing-retire¬ Street, have announced that, sub¬ ment benefits, they will need a ject to approval by the New York benefit of about $1,000 a month Stock Exchange, four new mem¬ stock June to do the same income job in relation to then standards as $400 The .' Inadequate Amount Set Aside The Jan. 1, 1959. partners are W. James Price IV, S. Bonsai White, Jr. and R. Gerard. Willse, Jr. in - the on a month does today. . bers will be. admitted to the firm moral of this is clear. Not new Baltimore office and E. James in Winston-Salem, only will -benefit levels Continue Holmes, Jr. N. C. ■';! ... ■■■■ • : to rise, but amounts" being set ; Mr.- Price - joined the firm in aside to provide them today will 1952. Mr. White joined Alex. probably prove inadequate. And Brown & Sons in November, 1948. all this is without giving any Mr. Willse joined Alex. Brown effect whatever to inflation. I & Sons in 1945, and since 1949 might note in this connection that , I a modest rise in the price level of less than 1% make any bers. for end will not material in these num¬ per annum A rise of %% per annum, has been associated • v with , the municipal bond department. Mr. joined Alex. Brown & Holmes Sons in 1948. large plant, to be completed in 1959. about ; . The city of Bal¬ Earlier #iis ,year the company sold $30 million bonds. Capitr! now about 50% debt, 7% preferred stock and 43% of 40 years. the rise the level of needed benefits multiplies over. 1% But per Reynolds-& Co., 120 Broadway, New York City, members of the rapidly; For: example, a rise of New * York Stock Exchange, an¬ only 2% per annum would double nounce that Rouse, Brewer, Becker the amount of benefits required to : & Bryan, 734 Fifteenth Street, N.W., Washington, D. C., also stock equity. The company has had in mind issuing some preferred stock, but market conditions are not favorable, it does not expect to do any equity financing in 1959. President. Theodore Wolfe has estimated share earnings for calendar year 1958 at about $2.38, which includes 29c from the rate increase. Last year the company earned $2.39 which, however, r included about 18c for nonrecurring dividend income. Excluding calendar 1958 would show a de¬ President Wolfe expects both kwh. sales and gas sales to show a gain of about 10% next year, so that revenues should also gain 10% or more; with over half of the rate increase effective in 1959, share earnings should improve although no estimate has been released by the company. Regarding the company's method of reporting earnings, it does not use either the customary credit for interest on construction nor does it avail itself of accelerated depreciation. The Commission allows them to include work in progress in the rate base, hence they would not be allowed to canitalize interest credits. Regarding accelerated depreciation, President Wolfe remarked that "the water is muddy," since some states are now requiring use of the flow through method to give the benefit of tax savings to the consumer. The stock has been selling recently around 42 and paying $1.80 to yield ,4.3%. It sells at 17.7 times estimated 1958 earnings. provide the same relative standard of living for a retired employee as, members of the New York Stock if there were no rise in the price Exchange, became their corre¬ level—and a rise of 3% per an¬ spondent effective Nov. 14. num in prices would require triple the amount. Such is the power of ! John A. Kemper Adds compound interest. (Special to The Financial Chronicle) Summary (Special to The Financial Chronicle) (Special to The Financial Chronicle) CHICAGO, 111.—Keith D-. Vanhas become & dercook formerly Young-Tornga & affiliated Weeks, South La Salle Street. was Co. 134 Mr. Van- with in electric service "area The New R. J. Buck Branch MIAMI, Fla.—Richard J. Bubk & Co. has opened a branch office at 1041 Kane Concourse, under te management of Herbert Potash and James H. Webb. Joins Reynolds Staff (Special to The Financial Chronicle) MINNEAPOLIS, Minn. B. Benson — John has become associated with Reynolds & Co., 629 Second Avenue, South. He was formerly with Piper, Jaffray ,& Hopwood. Marvin Yerke Adds (Special to The Financial Chronicle) COLUMBUS, De Grand ST. LOUIS, Mo.—Hugh T. Mc- Collum has become affiliated with (Special to The financial Chronicle) — Gail Inc., 40 West Broad Street. AREA RESOURCES BOOK New book explains why f ana we serve so offers t|MfatotmJ V .S/ ! much opportunity industry. to men's Bank Co., Inc., Boat¬ Building, members of the New York and Midwest Stock Exchanges. UTAH Rapids, Joins Revnolds Staff Ohio Burdette Co. Formed LOS ANGELES, CaL—Burdette & Co. has been formed with offi¬ & Deenis has been added to the staff of Marvin C. Yerke and Associates, Fusz-Schmelzle CHICAGO, III. —Clarence J. Snyder is now connected vnth ces at 8230 Beverly Boulevard to ./..At this, point, let us now sum¬ marize a few of the possible John A. Kemper & Co., 121 West Reynolds & Co., 39 South La Salle engage in a securities business. He was formerly with Wayne R. Benzing is a principal implications of these trends. In High Street, members of the Mid¬ Street. of the firm. Lamson Bros. & Co. the first place, we have quoted the west Stock Exchange. LIMA, Ohio—Myron H. Eversman has become affiliated with Electric Light and an population of about 219,000, the gas service area, about 107,000.; :About 67% of the company's gross revenues come from electric, operations, the remainder from gas. In the 12 months ended Sept. 30,1958 total? operating revenues were $17,311,000 and net income applicable to common stock was $2,670,000, or $2.43 per share. In the calendar year 1957 revenues were $15,576,000 and net income after preferred dividends was $2,-. 319,000, equal to $2.26 a share. fh* Hornblower three the years, Joins Fusz-Schmelzle dercook per. a of 12c compared with last year. With Hornblower & Weeks with common $1.43 Ariz, and in the surrounding area. has common Reynolds Correspondent as annum, sqn, structure is example, adds only 20% at the mounts to operating public ;utility supplying electricity and natu¬ ral gas service in the city of Tuc- Power is * both the in $29,300,000 years 1958-60. Tucson Gas, new the special items in calendar, year on amount 19, 1958 will not be paid on the; 110,000 new shares or on 11,000 > shares being offered directly to full-time company employees un¬ der an instalment purchase plrni. Net proceeds of this financing will be applied to. costs of die company's construction program which calls for expenditures of During the five-year period 1959-63 the company expects to spend about $270 million; this year's expenditure will approximate ' $1 million' and next year's some ,$46 million. About one-third of cash requirements are generated internally so that about $180 million in' new securities may have to be raised during the five,-ycar period, an average of $36 million a year. crease will share; $1.40 was paid in 1957, $1.20 in 1956. A quarterly dividend of; 38 cents per share payable: Dec J substan¬ result of industrial and commercial business contracted vfpp, in 1958 will exceed 1957i Residential sales this year are running about 7% % over last year despite the fact that summer air-con¬ ditioningsales were low. thjs activity* .. To Admit Four a dividends stock the state's building 1946; in the 1958 timore's; planning to rebuild some downtown areas, and tial loans have been voted to finance these projects. As a , in paid quarter since the oommon was sold to the .public m each necessary * to* expect reason : - been have Dividends . into the future, the holders. net plant account has averaged below 6% years-r-as compared with 8% in 1946—and the company The Cobimissiori's decision was rendered promptly and elec¬ an¬ tric rates^became effective Aug. .1. In its decision the Commission consider made the following statement/indicating that it is taking a prac¬ benefits,/ expand their; present fringe benetical view of regulation: "In the determination of rate of return particularly pension or other re-t fits-^-both in amount and extent tirement benefits, we must give of we must also consider the attractiveness of the company's securi¬ coverage, and in areas that are heed to. the gradual increase in bot now. ties in, the money markets, where company must compete against covered. For surely these the level: of: iiidng of the country all bther utilities to obtain the vast quantities of capital required developmen|s rwill come. If they as time. to meet The / demands and needs of its customers." The election of gOjM.by!. In'ttie past, per arenot.dofie-by private enterprise; capita income has grown : at", the a dcmocratic governor in Maryland is not expected to affect the "yoil rpay reft assured that they rate of approximately^% to 2Vz% ^will be.ddpe by government. I do, regulator# situation adversely. ; i ;/ /-! per annum on the average;**This not meah"tq. Thex company vexpects that business will continue to expand. ppply that additions fat^r-seemS* likely to be a; mere -*and InipFovements in programs : Maryland Tanks vseventh in rate of population growth among the important ' influence- on v future shbuld be put. into effect amine--* 48 states. Residential construction, after slowing down for about behefit^ th£fh inflatibri> v • a yehr,, has recently picked up again; the number of new homes di^teiy, but' -only gradually over For example* the level of dis¬ a period1 of /time as our rising completed* in the company's area in September was almost equal posable income!: is running. today ; standard ,• -of " living makes them v to those,byilt in that month during the peak years 1955 and 1956. at approximately $6,000 per family, f appropriate." Alertness 'in * seeking / NcW office buildihgs include- the yery large national headquarters on: the average. If past^ growth: out areas where the company can r :of the Bpciql Secuiity Administration. Kennecott Refining Corp. Even so, .when we the future: of. .employee num.., Corp. will un¬ offering to stock-' First Boston The on be at a price of $49 a Rights will expire at 3:30 share jointly by Blyth ,& Co., Inc." and System, daily demand being 145 million cf. However, the Commission did not give very much recognition "fair value" law and fixed a rate base only about 3 V'i % above book cost. It also refused to grant any additional rate increase at the present time to cover storm costs; the storm of last March cost the company $2.5 million in operating expenses which is being amortized over a five-year period. to . additional 110,000 For share. favorable Method. * be- a to seek rate relief. Accord¬ ingly, last January the Public Service Commission of Maryland was asked for an increase of nearly $10 million, and it granted about 95% of this amount, equivalent to approximately 63c a share. The company had asked for 6 Vz % re: irn but received 6^ %. How¬ ever^ the ?rate base was estimated as of Dec. 31, 1958—an unusually Urges Expansion of Fringe < Power, ; decided that it would attending college than was true qf thbsgiattending high school immediately.' after World Wat I. now*; Water for at $5 par value common each 10 shares held, stockholders can subscribe for one shares p.m. (EST) on Dec. 15, 1958. An underwriting group headed for is noyt <the.peak, reached in July of this .year.c My honest belief is that/ the price ' level- will have some upward drift to it over time, Harbor of stock common new However, the return retirer, • Price Index Safe subscribe stock. The company's suare learnings remained irregular curing 19461954 but increased moderately from $1.89 in 1954 to $2.33 in 1957. can exceed controls its Nov. 25, 1958 rights to on kw.; in 1957 it generated 79% of electric output and purchased 21%, mainly from Safe Harbor. About $1 million was saved this year due to extensive interconnections. Natural gas is obtained _ _ sumer company of holders Gas, Electric Light is offering to the the Susquehanna River with 400,000 kw. capacity. Baltimore C; & E. has five steam plants with a capacity of 955,500 from the Columbia Gas ment,'accident, hospitalization and play an important part in promot¬ sickness benefits, I can visualize ing a stable price level. ;that the general field of education, •Whiter the prospects for con¬ particularly. at the college level, trolling inflation' seem encourag¬ is one that iS ripe for develop¬ ing, ii would be a rash person ment. " I am told that a higher who would predict that the Con¬ The . Co. Power record areas. company ; on com¬ and that benefits wiil spread adjacent Electricity accounts for 70% of revenues, gas 29% and"steam 1%. Residential sales provide about 34% of elec¬ tric revenues, industrial 34%, commercial 31% and other 1%. pared -with unduly upset by additional & Baltimore <ias & Electric provides utility services in Baltimore hnd 4 where Utility By OWEN ELY the direct receipt of which we an equivalent amount of money. the general public .seems to op¬ /This is a- part of the- general up¬ erate on this assumption. Also, grading of living standards. the public is getting used to hav¬ r; It also seems cleat that benefit' ing small skirmishes at the fringes amounts will continue to increase major holocaust in would all perish, and i-.i- Public , a: 27 (2219) POWER Write lor FREE COPY Boa 899, Dept. K Soil Lake City 10, Utah The Commercial and Financial Chronicle (2220 Continued ited. from page 14 Yet, Warren and Pierson did such ders an irreplaceable and passed, at the time that the Mon¬ world etary Funa was created, giving tne president the power to cnange call attention to the fact tnat the correlation between prices, The United States and The Problem of Gold securities market (despite the pur- hase by the commercial banks of ; 10 billion of such securities since < id-1957), the underdeveloped countries are us rise the nother symptom * market stock worries lidence which mone- our Within of such view dis- clear and quieting facts, tnere is good cause ask to the for reasons of my Here country's stay-put attitude. «-ary managers. (2) In last the the year united States has lost $2 billion in fold, which has forced the Fedt ral Reserve Banks to purchase <n equivalent amount of Govern- are the principal ones: • (i) First of all, there is the in¬ ertia and the lack of foresight of ine free efits the free world above-mentioned therefrom. explanation ac¬ cording to which our American policy, since 1914, caused the buy¬ ing power of gold to conform it¬ self to that of the dollar. Price of Gold and the USSR Deplores Inaction is of lack of con- as a basis ot lis c^rency system that the advantages the Russians get from a nigher gold price may are minor compared witn the Den- (5) According to the experts, Russia's annual gold production is somewhere between $200 and $300 million and their stock of gold is estimated at $3, $4 or even $5 billion. These estimates are used to argue the price that an increase in of gold would benefit would oenve who examine the problem of the price ot goid from the viewpoint of international liquidity assert that the countries the most in need are the least of it governments. the events to able to profit by its gold holdings (our wages and the prices of our fin¬ ished products are still rising) and even if more of its rome in sary it continues to gold, it will be order to lose neces¬ further expand cur money supply to increase the amount of government bonds held by the banks. If we consider that people are beginning to dis¬ our trust the dollar and ,'ist on «ost of ot -j be It easy true that they in- the living such an is in halt a rise of the policy will a matter. , that in the arsenal of American monetary management Ihere are weapons with which to parry partly the dilemma I have just explained. For example: A nw. could gold reduce of coverage Banks the the commitments. umple decision of statutory Federal Also, by the a Federal i.,anks, the percentage of the re- that the commercial banks serves are obliged to keep in the Federal L*anks, can be reduced. The use these i: technical '.pulations—call tricks them or ma- what you roll—can at best delay the ineviSable in the hope of better days, A^ut if the price of gold is not changed, and unless there is a ca- tastrophe in Europe, the chances seem poor for the United States ip- order to widen sufficiently the gold basis of its monetary system. Thus, it is difis er a P°ssible period of time to: (a) Sustain the increase of the national income. (b) Cover in gold the currency and the the Federal Banks to up 25% (3) The most frequently used against the change of argument the price of gold is that it would feed inflation. This argument seems that valid to me if we assume unwilling to put an end to inflation and in particular to the monetizing of debt to fi¬ nance government deficits. It is constantly reiterated that neither the government nor the people will have the fortitude and the we are will end to the monetary muddle, and that the masses learn and act only after they have suffered. volt they Reason and good sense re- against such assertions, but seem powerless against the forces of evil. democratic Apparently, in the countries uni- with versal the with suffrage, the masses have right to kill their liberties their own hands. In my opinion, this state of affairs comes into being mainly because the politicians, the leaders of industry and the educators fail in their duty and lack in courage. (4) Most persons will not make the distinction, valid as it is, between the devaluation of a currency and the the gold value Robbins, Sir Dennis Robertson, Roy Harrod, Dr. William Busschau, etc.) is that such an increase 1 submit that it is whether tion break the the an open ques¬ Russians international can by maintaining the pres¬ price of gold or by raising it. are many more cogent rea¬ to believe that the maintain¬ ing of the present price of gold is the great danger to the free society. To a totalitarian country like Russia gold is only a com¬ modity which the entire world is willing to buy. To the free society, split into so many sovereign coun¬ tries,. gold is an indispensable means for political cohesian and for the integration of their eco¬ nomic and monetary systems to permit unhampered multilateral non-discriminatory international trade. con¬ com¬ munity as a whole and fails to recognize the mechanism by which countries acquire their gold. (7) Lastly, the official position Continued from page i all expenditures and appropria¬ and give its recommenda¬ tions tions, to the President aftej* care¬ ful screening. The purpose of the Committee would be to eliminate wasteful and extravagant appro- Criations so that the budget could balanced in average years and e - politically difficult and deli¬ operation, save if it were the aftermath such of was as the in 1933 case 1 event like to end my would I with dramatic a v . . paper few remarks. a The responsibility of the United States in the present world mon¬ etary situation is the greater as the free world, either inadvert- • ently or deliberately has been put ' on Our dollar-standard. a indi¬ vidualistic society, however, seems live to the under sponsibility far as sign of irre- ;* the general as interest is concerned. To be more specific, political men are able to commit, without: penalty, errors which have the. greatest, conse- a > > for their country or for , world; the most that they : have at stake is their reputation : and, sometimes, their re-election. ; Facts being what they are, it seems to me that it is the duty : quences the of leaders of the the free coun- / tries, whether they are involved in business, in politics, or in edu^ ; cation, to provide those in govern^ . their enlightened un- ; with ment society free A selfish: r eounsei. : only survive at the price of > constant vigilance on the part of : can leaders. its world is havoc of .with international ated provision with gradu¬ increase for in reduction of the This Resolu¬ sufficient is conditions. It is to be un¬ proved by the Committee in ad¬ dition to his normal veto powers. It is easy to show gold by the free deflationary and would loss be applied to the payment of national debt each year, reasonable to visualize the results under ad¬ to buy its gold. year the becoming more aware of the prob- : lem of inflation and the sentiment : derstood a April of 1957, which requires (among other things) that a mini¬ mum of 1% of the income re¬ ceived from Federal taxes each veto any This that , the President expenditure will not ap¬ affect our economy slightly for a short time, but as the may tion : did receive not it was intro- However,-, the duceod. public is changing rapidly. The thinking is sound, even in this Resolution though some aspects of it may have to be modified. would •This in fidence help establish con¬ fiscal policy and our give concrete evidence of at least a minimum of debt re¬ national American people, as well as duction each year. I recognize that the rest of the world, see that we this cannot be done for this com¬ whose aim is to re-establish a question may, however, be asked are achieving not only a balanced ing fiscal year and there will ob¬ normal relationship (upset by the whether the Russians have the budget, but a permanent fiscal viously be necessary provisions inflation caused by a major war) wherewithal to purchase gold in stability, our prestige will rise and to alter the case in times of ex¬ between production of gold and the free world. It appears that our currency will be sought after treme emergency. There have that of commodities. during the period of massive con¬ throughout the world as it has been times, because of large mili¬ Even today many responsible ventional re-armament the Rus¬ been in the past. tary expenditures, when deficits individuals insist that the deval- sians have built a great capacity Any temporary adverse effect have been a real necessity, but uation of the dollar carried out in for producing raw materials and will be the price we pay for a unfortunately we have permitted 1933 was not only useless, but some semi-finished products. Such more permanent stability in the deficits to become almost an of the relationship between Yri1Uingly paving out duction of gold and that a cate policy during times of prosperity, not much imagination is necessary commodities could be sold to the future. American way of rest of the world tZ matter of loans and aid that government. At any rate, it would consideration when verse re-adjustment of liquidity and would therefore of all currencies hamper international trade. The pernicious. At the time, the monetary adviser of the American « from tne the government debt. If we can^ not operate on this kind of fiscal " , license a debt in future years. , hdc T?e,C? lfgiWe^ without definite portion of our taxes could be used to begin reducing some .n-nv ' States seems Danger oi And a Program to Combat It ,. -j It The against gold. Be¬ This must be done in a sound government was Professor War- sides, should the Russians' fight and realistic manner that will im¬ to penetrate or conquer Southeast press the American people—and (c) Maintain the present price ren' ^uth°r ,with Pr°fess<?r piel" Asia succeed, they would become the world of gold in dollars. generally — that we The full em- ??," of a b°Aon gol<? and pnc.es; masters of important sources of mean what we say and that this ployment policy and the excessive raw materials badly needed by is policy will continue in future ad¬ power of labor unions make even ,?T '"accurate as it is the free world. Our monetary ministrations as well as this one. more difficult such an accomplish- discredited—according to which a policy has had the effect of re¬ This step will develop a desirable ment. 1 country can reach any price level t~ that it desires by changing the ducing the purchasing power of climate for the other necessary tn ^J]?ldera*10PS ais? lead gold weight of its currency. Pre- gold to that of the dollar, and steps and give people a greater believe that rt will betherefore at the present price the sense of security in their savings sented thus, the theory does not it? Td m?re, ?ulffl?ult t0 do them justice, but the responsi- Russians could acquire a much banks, government bonds, insur¬ T*•deAmeri- bility for the misunderstanding is larger quantity of gold by selling ance policies and investments Thfo i°F *oreign largelv theirs. Whatever may be raw commodities than it would be generally, as well as a feeling of -11 ml nyi seems J?6 about their theory, the fact is that possible if the price of gold were confidence in our future economy. rwtnrat^!ren i because of its being discredited, not arbitrarily maintained by us Favors Saltonstall Resolution n/iho complaining bitterly other valid theories ..concerning at a low purchasing power. ~ * In summary, the real danger to The third necessary step would /fr ^*penses '?*• government the influence upon prices due to deposits of embargo on that this snould be possible because no goid can be exported from the United gold. 16 The greatest harm the Russians could inflict on the free society is play orderly fashion an put an and no one would wish for a repe¬ tition of such a catastrophe. the free international system that in to problem of the price of gold cerns currency There sons be y, benefit the Russians. could ent be changed be their since • increase price of gold:/ But our lavvs being what they are, the only way in wnich the price of gold could it, gold reserves are scanty. This assertion seems to me to ignore the fact that the are They wait for the Russians. give us proof of trie First of all, if Russian gold necessity of acting, in the same of the American Government is to (3) Foreign demand deposits manner, by the way, as the Mone- holdings are so high, why did the Soviets recently ask the Amen-* affirm that the fixity of the ratio liave now reached a total of $15 tary Fund expresses itself jn its cans for r credits to purchase between the dollar and gold is a iJlion. report on international liquidity. American merchandise which great factor of stability and that (4) Foreigners now own about (2) The necessary conditions 7 9 billion in American stocks and the Russians, apparently consequently one must not tamjier for the stoppage of inflation are they, ./■ with it no matter how valid may \ onds, the greater part of which exactly the same as those for the need? The Soviet magazine "Interna¬ be other arguments in favor of a can be liquidated against dollars, return of the gold standard. tional Affairs," recently published change in the gold value of the As our gold reserves are ap- • \ct it is a fact that the an article by First Deputy Presi¬ dollar. This is simply ah. argu¬ proximately $20.8 billion, it can individuals in charge of the ad-' dent Anastas I. Mikoyan, asserting ment "pro domo" : be calculated that there are about ministration ; V of our fiscal and that the present: artificially low: : 4 billion of free gold to cover However, one must take into monetary affairs are almost unanprice level of gold has been im¬ account American legislative ftatutory national gold require- imously in favor of a managed mcnts which amount to $12 billion, currency, although there is no posed by the United States in problems. Normally, a law would without taking into account the disregard of the interests of the have to be passed to change the example in the world to contrai9 billion in stocks and bonds diet the conviction that the con- countries that have gold to sell. price of gold and this would en¬ It is conceivable that the Rus¬ tail whose possible liquidation repremeetings of the specific com¬ sequences of a managed currency sians are simply trying to please sent the greatest danger, from the are mittees, who would give their always disastrous in the ena. the i fandpoint which interests us. gold producers of * South opinions : only after prolonged Moreover, one should not forAfrica. However, Mikoyan's dec¬ If we assume an increase in the hearings. Such a way of proceed¬ get the lack of resistance to laration deserves closer v': study, national income of 3 to 4% per ing is, however, unthinkable be¬ spending of parliaments and govRussians are perfectly cause it would, beyond the shadow } ear, the means of payment will ernments when forced by the de- for. the have to increase sufficiently 1f mand of a welfare state, as well aware that one of the. principal of a doubt, start off a sequence of relatively stable prices are to be as by the mystic of the full em- arguments advanced against the unbridled speculation, ) ■ main tained increase in the ' price or if a tendency to-* of, gold, If a Uttle foresight had been ployraent policy and the extraorwards!loWer prlt,es is to be avoided, recommended by most of the Britused, a law Would ' hdve be&i dmary power of the labor'urilons If the United States is unable to in the United States, ish monetary experts (Lionel States. our iC.ent securities. the would (6) Those which unmistakable sign an in threatening to turn toward the Russians. cf loss of confidence in the dollar, .the while for clamoring valuable service to annual gold production and tnat of com¬ modities, was not longer as close as oefore 1914. However, they did not, to my knowledge, adopt the Thursday, November 27, 1958 . .. the free world is that the Russians the proof enn- may buy modifies, have also been discred¬ they may our sell not that theirs. Gold ren¬ gold us and be the adoption of the Saltonstall Resolution SI738, introduced by Senator Leverett Saltonstall in This can life. and will be our ruin¬ ation unless it is stopped. .. the press warns of the danger of inflation, while busi¬ ness analysts tell us that business is on the upswing and many peo¬ Daily under the delusion that all whereas our anticipated prosperity is due to enlarged gov¬ ernment spending programs and the deficit that will have to be ple is are well; financed in the near future, all of which means more Emergencies denly — but emergency and we inflation. usually ours rise sud¬ is' a creeping that is approaching— must make certain that it does not get any nearer. / j Volume 188 'Number plished after The these jsteps The Commercial and, Financial Chronicle (2221) have appointed The positive of sources values and re- great country our for taken often too all .... . taken. been ' 5798 granted NEW BRANCHES NEW OFFICERS, We est have enough productive food, ETC. great¬ in the world—a know-how envied by the entire world and a military organ¬ - to Our none. ca- pacities have been developed in a relatively short period of years by a well - organized economic system (thanks to the Federal Re¬ serve Bank) that has grown with Bank in The appointment Lucius D. Clay it will General of of be their first banking York, announced was on Elliott Nov. 20 effective New York, is Bell Trust Company, distributing Trustee of the Dime as immediately. Mr. tees of the Dime we is sound need of this our system that inflation further without manage¬ economic so country will continue to pros¬ permanently on a sound basis, so that our people will be em¬ ployed and that our Government Bonds will retain their place as per security foremost the anywhere wprld. In short, it would be the new/Economic Era many have in the been hoping for. , r'We will require tional program and ment in common and fractions. and pence * all financial institutions should early in 1950. detrimental constant The ture. publicity that so many of our pub¬ have been spreading tends ta undermine the confi¬ ing this folder at intervals for the past 19 1, 1939. Kings the first dated May years, * * ii people in our American system. Public Vast We need a Education Campaign public relations cam¬ paign to awaken the American people to a recognition that our vast resources, our living, our great of high standard opportunities all being for the average man are New of York, Jr. Government leadership can and cooperation of such as companies, the mortgage banking industry and many other fields of business and industry,, together with labor, in combatting the dangers of infla¬ should inspire the institutions financial insurance banks, : tion. " ' as resident Y., representative resolution, indi¬ implementation of this pro¬ The will require a considerable amount of planning by competent government people, supplemented industry and labor. The program outlined here is neither radical nor extreme.. Its 10% is for a moderate but reduction of expendi¬ and a method of fiscal oper¬ that should establish confi¬ consistent tures ation dence a long-range program give us stability of cur¬ for that will in recommended meeting in January authorize an increase in the capital stock of the trust company in order to permit Bissolati, the dividend. the stock •' ; > ' . • / , * and the 1936 through Office. 1940 at its Wall St. present Fitchburg office, this pro¬ posal is evidence of the bank's • i: $ Directors of * Commercial confidence Bank in dividend is payable New York, stock. . M alternative is more infla¬ tion with continued weakening of our currency and later, measures so drastic that our very form of government might be threatened. We must keep uppermost in our minds the simple fact that with¬ out a permanent sound economy we cannot have strong military defense* * Certainly the leadership of the American people has sufficient vision, courage and patriotism to take positive steps to prevent to¬ day's creeping emergency from becoming tomorrow's realitv. continued the on viduals in the dividend The # $ " * Little Falls, Little Falls, Minn., in¬ creased its common capital stock from $100,000 to $200,000 by a dividend, effective Nov. 12. (Number of shares outstanding— 10,000 shares, par value $20.) stock * „ First # « National Bank of Mel¬ Fla., Melbourne, was granted permission by the office of the Comptroller of the Cur¬ rency to open a new bank. C. R. is President and Wm. C. Payne is Cashier. The bank has a capital of $400,000 and a surplus to increase 1959 to ments the in 5% of fice $350,000. > Plans to merge Connecticut Bank plus such cash be justified by operations, it was announced by Jacob Leichtman, President. Commercial America is Bank Manchester Trust Co., Manchester, Conn., the outgrowth of the merger of the Bank of North America, New York, into the Com¬ State mercial Bank 1958. each of Federal and state The proposed will merger * bank of and banking author¬ Stockholders ities. the banks. both stockholders Trust and of by is subject to approval merger Company of New York in Septem¬ approved been have directors North of Conn., and & Trust Co., Hartford, may vote on on Dec. 16. # « • ■ paid dividends of 4% in stock and, Cashier; and Joseph A. Halbeison, Trust Officer, based of the First Camden National Bank 1957, Commercial State Bank outstanding presently stock, $0.21 in cash. on « $ C. George * Muir, and Trust Company, elected were # was of Emigrant Industrial Madden knowledge the Certificate said that Emigrant is the to his Bank's first of its a Christmas need, the grant Gift Certificate may Emi¬ be ob¬ tained the year round for use on occasion—graduations, births, birthdays, anniversaries, etc. any The donor obtains an attractive Gift Certificate from the Emigrant Savings Bank which, in turn, is exchanged by the recipient for a savings account passbook in his name. This may be accomplished by mail and the service is avail¬ able at any of the bank's offices. Mr. Madden pointed out that a Gift Certificate of this type, in addition to its practicality, encour¬ ages thrift and for many recipients Federal ton, elected Del., George P. Ed¬ monds Chairman and Joseph W. Chinn, Jr., President. By / mon Brook N. J., State Bank, Bank of >:s .. © First Gaithersburg, with Gaithersburg, stock common with merged was Bank of Md., its Saddle Brook, admitted bank to doors for business on The capital of the bank <5150,000, and its surplus, $250,000. Officers of the bank are: Fred Woitscheck, Chairman; Irwin W. Silverman, President; Fred S. Walter, Vice-President; James M. Gray, Cashier; Paul E. Hoban, Secretary; Conrad M. Gregorio, Treasurer; Thomas Dineen, Assist¬ Bank, Germantown, Md., under the charter of the lat¬ ter and under the title The Mary¬ State of Bank County, effective Montgomery of Oct. 14. as ■ : ^ Halbcwty, announced. Bank of Washing¬ ton, Washington, D. C., with stock com¬ of $1,000,000, have merged, effective as of the close mon Nov. business of dation 10 consoli¬ The effected was s of Washington, D. C. Bank $ Robert * t A. Cline, Chairman of to * * of Board Directors of the Fifth-Third Union Trust Company, which was Third Bank in Cincinnati, merged with the Fifth1955. * * of Park Bank The former Lin¬ Ridge, Park Ridge, 111., will open for business Dec. Capital structure of the Bank of Park Ridge totals half a million dollars $250,000 capital, $150,000 surplus, and $100,000 re¬ — The bank's stock is owned serves. by 315 shareholders, most of whom live in the bank's trading area, making it locally a owned customers William of the dent and Cornelius E. been new and to the public increase to than 1000%. more This what marks local another financial step circles in term remarkable progress since Hal¬ bouty purchased the bank in Feb¬ ruary of this year. In its stock dividend transferral from undivided profits. Since February, months, the bank's deposits have, increased $1,420,000. B. Wilkinson ecutive Vice-President. kinson sjs Edward and Lawrence the of Warrenville Cox have Ex¬ of been^ Secu¬ rity-First National Bank, Los An¬ geles, Calif. S'f Dean J. is Mr. Wil¬ Bank of Park associated with been W. Vice-Presidents elected Calif., Ridge will be Robert G. James, a banker for 31 years. He had previ¬ ously Allen, A. Ames Tuthill,. G. Foy, Earl H. Curtis, « dent the announced McDowell and Edgar as F. Francisco, election of Vice-Presi¬ Kaiser as a director. organizer of United was an Cashier if. # Alton E. Ridge of Park Bank Edward the bank's total capital and surplus have been in¬ creased 136%, to $650,000 from $375,000. And in the past nine Presi¬ is Con¬ Appointed Co-Manager DALLAS, Texas — G. I. Jack Vaughn has been appointed comanager with Stephen E. Case of the Dallas office of Shearson, Hammill & Co., Fidelity Union Life Building. State Bank, Warren- ville, 111., where he Vice-President, was Cashier Executive and Bernstein Co. to Admit Di¬ PITTSBURGH, Pa. — Bernstein rector. & Co., Frick Building, members of Thomas J. Maloney is Vicethe New York and Pittsburgh President of the new bank, attor¬ Stock Exchanges, on Jan. 1 will ney Marshall S. Howard is Secre¬ admit Robert Kostman to partner¬ tary and Counsel, and William J. ship. McSweeney, Vice-President, Cen¬ tral National Bank of Chicago, 111., To Be Homans Partner is Chairman of the Advisory Com¬ mittee. * Homans * Harris L. Stone, Trust and Vice-President, Savings Bank, Chicago, 111., has been appointed by Governor Stratton of Illinois to nine-man state banking banks from the state Auditor's of¬ has a Halbouty, by Bank of America, San advisory committee, which will help shift supervision of state Pa., Under consequent a and operated institution. Division of Mel¬ Pittsburgh, scares stockholders/of established 5. lon National Bank and Trust Com¬ pany, . ; per date in number of stockholders of Chairman for many years of the coln National Bank, serve on a Josiah T. S. Horton, new head of to of Dec. 8. as with New change Bank, Philadelphia, Pa. paid cepts October, the bank increased capital stock to $300,000 from $175,000 by splitting the stock Cincinnati, Ohio, died Nov. 19. His four-for-one, reducing its par age was 64. ' • value to $5 from $20, and making Mr. Cline was Board the «s A. J"> Greeough was elected a director of Girard Trust Corn Ex¬ be the bank's stock has been released the under charter and title of The Riggs Na¬ tional >1'\ . Twenty-five will policy $8,000,000; and The Lin¬ National 11-year history will be State Michel T. Board.. Chairman, .has Bank, Houston, Texas, stock coln value par Payment of the first cash divi¬ dend in its record of (Number of shares out¬ <iv Riggs Fred the Advertising First. Company increased was made Dec. 15 by North Side Natiohal Bank of Washington, D. C.» with common The * $ com-, The 14. ; 0 ant Cashier. ff of Trust standing—50,000 shares, $8.) The Germantown Trust Co. in Chicago, 111., and with 20. & $100,000, into and of tinental Illinois National Bank and opened stock Bank $300,000 to $400,000, effective »:> National member¬ Nov. capital from ". ship in the Federal Reserve Sys¬ tem on June 2, has officially was si: stock dividend the Vicksburg, Miss., Home Bank & Trust Co., in Mason of Saddle organized newly a a National # Reserve New York announced that which Savings Bank, New York. Mr. The made public this week by John T. Mad¬ den, Chairman of the Board of Trustees Wilmington Trust Co., Wilming¬ City, Iowa, in 1935. unique idea in the expanding field of Gift Certificates Camden, N. J. Vice-Presidents. # A * # % pay¬ 2V2%, as «t 1959. dividend in stock semi-annual completion of the building and occupancy of the of¬ during the early summer of Dec. 15. on The board also stated its intent ' a area. Plans call for Dec. 31 to stockhold¬ on of record ers to fill gram. Our in growth and development of North¬ Nov. 19 voted a year-end extra ern Worcester County and is in cash dividend of $0.25 per share response to numerous requests re¬ ceived from companies and indi¬ in addition to a semi-annual 2% North America, of Gift high it of Estate A' established in the for¬ The American National Bank in Brown a the ab-* Mich. location of the absorbed bank. mer trainee, he was assigned to Planning Division of the Trust Department in Novem¬ as I State Mich., Gagetown, was bourne, in September 1953. After working in various divisions of the bank land <: -At ing to Earl S. Eichin, Vice-Presi¬ dent and Manager of the bank's with Bankers Trust Company from regard for kind, at least in the New York government securities they for¬ merly enjoyed, with particular Metropolitan area. Although this service becomes available in time emphasis on the savings bond pro¬ rency Gagetown, an¬ , , Merchants Sebewaing, Assistant Mr.. Scully came to Mellon Bank The that the stockholders at the annual relationships and will also cover Southern Europe and the by finance, purpose Scully, Jr., has been Secretary of & , $ Nov. a ; ian In gram M. Frank R. Denton also nounced. Company, announces resolution The office will service the bank's Ital¬ ber 1 Arthur appointed of that, meeting, the Board of recent a Trust cating its intent to. declare the announced Located at 76 Via County stock dividend. appintment of Landon K. Thorne, dividends jeopardized by inflation. to Mellon Bank came of 4 sorbed The State Savings Bank of ber 1957. # Allen, President Trustees passed a William H. Moore, Chairman the Board of Bankers Trust Com¬ pany, A. Brooklyn, N. at $ lications dence of as to the Personnel Division. ■''' Chester President Edward L. Clifford participate *; and wftieh Will fie Middle Eastern area. spelled dut in simple language so The establishment of its first announced on Nov. 20 that the that people in all walks of life; rqpj-gsentatyve office in, Rome is Wfti;ccster County Trust Company,, will have a complete understand¬ part of Bankers Trust Company's Worcester, Mass., had made appli¬ ing of the purpose and goals ol plans to enlarge its interests in cation to the Board of Bank In¬ the program. Labor leaders recog¬ the international field and the corporation for permission to es¬ nizing the value of this program common market area as well as to tablish a second branch in the City for their people will certainly assist its American and overseas of Fitchburg. j want to share in these .activities so customers in Approval of this application will developing > their as to protect the samigs of the mutual business relationships. increase the trust company's working people in whatever form Mr. Thorne previously served branches to a total of 14. Accord¬ they may be. We must develop a feeling of confidence in the fu¬ Farmers Bank of | • \ ' * ' publish¬ Rome, Italy. which ap¬ January 1956, and is assigned M<>u~n death of Albert Hutton. (b) Manufacturers Trust Company has been vast educa¬ a led by the govern¬ and commercial shillings (a) in Bell elected to the Board of Trus¬ was new a the was Department -. . Assistant Adver¬ announced Mrs. Oden his announces Savings Bank of Brooklyn, N. Y., # % V V. resignation Answer Is Sound Management All as pointment of Jeanette R. Oden edition of its "Foreign Exchange Perhaps the very rapid growth of Everett J. Livesey, President,, Quotations" folder. The folder lists our country and its rapidly ex-' current announced the election of Hugh G. quotations of currencies panding economy has given us a of 141 countries Johnson as trustee of The Dime throughout the. false sense of security. He will fill the world. It also contains two tables Savings Bank. showing the decimal equivalent of vacancy created by the recent ment 1956 Mellon state " branch with came Assistant Cashier. by John J. McCloy, Chairman. Manufacturers Also ex¬ perience. director a as Chase Manhattan Bank, New The great rapidity in the last 40 years. » Horton V • tising Manager. capacity second ization su-" of ket research for the bank. Mr. established Financial Institutions. ; advertising, public relations, sales training and mar¬ great and the resources > Mr. Horton's duties include CAPITALIZATIONS mineral Board. pervision REVISED degree. the of CONSOLIDATIONS and must be put into proper focus and dramatized to a much greater Cashier. made was by Frank R. Denton, Vice-Chairman News About Banks are Assistant an announcement 29 fice on Jan. 1, to the nroly New & Co., 65 Broadway, City, members of the York Stock Exchange, on York Jan. 1 will admit Andrew German to partnership. Theodore H. Wegener, Theo. H. Wegener, President of the Wegener & Daly Corp., Boise, Idrho. n-\*sed a-v'~Vvv. c"\ The Commercial and Financial Chronicle (2222) 38 The turers. impulse to reduce in-; phase. Consumer prices generally tnereiufe" a baled." By benaved in similar fashion, ex¬ venlories April Railroad Securities , production arirb cept " that their declines were employment smaller and came somewhat later. lowest level of tne In recent times, while the price reacned tneir and recession are Under Discussion the recent with railroads the position a reported is progress as possi¬ havings been made in the pro¬ of the Norfolk posed Great Northern-Northern looking the to bility of a merger Western and Pacific case also stockholders do large bituminous coal carriers and not seem willing to go along at present time, although a in many respects have a large the definite plan has not as yet been amount of paralleling mileage, f forthcoming. It is possible much duplicating Reportedly, Baltimore & Ohio, facilities could be eliminated with Western Maryland, Reading and consequent savings. These con¬ the Virginian Railway. Both of these roads are solidation only a statement follow talks time short the after roads that from five New England they were considering a merger. The latter roads particularly need some methods of reducing oper¬ ating expenses and to strengthen themselves financially. They have been hurt by high taxes and mounting passenger deficits. Most has been this far so serious drain a In resources. the In were picture. the Southeast, into step the Atlantic Coast Line and the Seaboard Air Line have These had preliminary talks. considerable have roads their These two roads have been active drain Studies > would duplicating mileage and it is be¬ lieved savings could be large. further wage a in view of competitors for both freight traffic high terminal expenses. ■ roads Nov. 1. This will mean on further a cash on addition, they obliged to absorb increase this and year other the continuing are the on and passenger business. They both proposed merger of the Pennsyl¬ have vania Railroad and the New York their territory and have played a Central large part in the industrialization this case, however, industry observers feel there may be some consolidation of duplicate facilities long before any financial plan can be worked out. At a matter of fact, it is System. believed that Continued In internal some from page op¬ attracted the of district. new industries Revenues to both of of these carriers have grown over the years and the combination of the would two make even an Many factors increasingly inflexible in times of recession. Indeed, during the re¬ well the recovery, the recovery of 1954. Let ture /' turn now to us the of warrants recent special notice, ing feature of the recent recession, namely, it has provided us with new evidence that a slump in production under modern condi¬ tions need not involve a slump in personal incomes or in consump¬ tion. in that business the cycle sumption not Was economic ^ growth.; of conditions Credit eased incomes, since the revenues yielded by our income taxes auto¬ matically decline as incomes fall. The government also if other look may the back moment, a that income the to that was that American people had at their disposal kept on rising after only a brief pause, thus defying "economic law" as then we it. knew During the social provided The of both legislation. these the fiscal Federal Government and the private busi¬ system was to erect a buffer between production and personal Federal was, of benefits ness The occurred existing effect incomes. that income security by net operations recession of 1957-58, the aggregate of personal incomes did not rise. decline the by increasing unemploy¬ compensation payments and ment we into suras stream ments of the recession of 1953-54, episode for pumped sub¬ profits Undistributed fell corporate drastically and the piled up, but the deficit however, extremely small. Be¬ tween August, 1957 and this April, aggregate income that individuals the dollar volume of the nation's little. total output fell about 5% and the The virtual stabilization of per¬ sonal incomes helped physical volume fell about 6%. had at their In earlier times personal incomes to disposal changed very powerfully spending maintain c/onsomer would have responded decisively so severe a drop in production during the recession. to if a short period, and a spiraling depression might easily have about the future, their spending might have been curtailed sharply. over /developed. gate of This personal fell taxes time only the decline was the aggre¬ incomes about over after 1% well and before the recession ended. i' • people ontim'stic Development This loosening of the ties be¬ tween production and the flow of personal incomes is one of the most significant and promising developments of our time. It has resulted from the more or less automatic workings of certain of institutions, not from delib¬ erate anti-recession policies of the To be sure, become remained despite the uneasy generally sharo de¬ cline of production and the spread of unemployment. If there were heroes that ' our But any Most Significant and Promising had consumers during the rece-sion, distinction belongs to ordi¬ consumers, who went about their affairs without fussing and nary maintaining high rate of spend¬ fanfare. Although spending on automo¬ biles and other durable goods de¬ clined, spending on nondurables hardly chanced while spending on. ing a without consumer services actually increased. In the aggregate, consumer expend¬ itures in the first quarter of this lesson tomatic.. stabilizers again. once of have the, au¬ worked, In view of this activity factures at its peak. was 2.7%,"' ,v' was * ' The movement of wages and prices during the recent recession ; new.! evidence constitutes tnat, while there may well be pauses in the process last few cf inflation, as in the months, the unuenyn g trend of the price level is still no- The ward. main reas ns To * this insurance system. This ■'./ J the Congress re¬ sponded to urgent demands by extending the duration of unera-;, .'. year ; ployment benefits^ However, this legislation was of a temporary character, it failed ta embrace all of the it did not states, and deal with the matter ©£ coverage the size or of benefits. It would hardly be wise to wait for another recession before we again tackle the problem of unemployment in¬ surance. A reform, I think, ^ is overdue. long vided for The benefits pro- insured workers are Now-:'. inadequate in many states. The through successive decreases of adAVs trade, unions gehetUily na>e maximum; weekly- benefit repre¬ reserve power to ,mainiai.i. sents 50% or more of the average requirements and Of the V sufficient discount rate..kSpecial measures wages during a moderate reces¬ weexly wages of insured workers were adopted to liberalize housing sion and often even to raise them. in only six states. The duration credit. The processing: of tax re¬ This tendency is reinforced by the of benefits is 28 weeks or longer funds and ' of loan, Applications growing practice of entering into for all eligible claimants in only was speeded up. Some tax Adjust¬ labor, agreements that call for seven states. " More serious still, ments were made,principally wage increases or larger fringe about 13 million workers are en¬ with a view to aiding the rail¬ benefits at future dates without tirely excluded from' protection roads and small businesses.: The regard to the state of employment of unemployment insurance. Now main emphasis of Federal policy, or profits that may then exist.. that our economy is once more however, was puteon raising ex¬ The rigidity or upward push of expanding, we are in a position penditures, rather than, on mone¬ wage rates during recessions re¬ to w e r e .. development are familiar,-. . , , . „ tary, tax, or housekeeping meas¬ ures. Programs to increase or ac¬ celerate expendtiures proliferated —witn more for defense, for pub¬ education, post in sults in When months. expenditures the sched¬ finally up, they came to a much larger total than had been planned or advocated by the fis¬ cal authorities of our government. Viewed were whole, the actions by the Federal Government taken as a stimulate to the economy un¬ doubtedly contributed to an early recovery. The monetary and hous¬ ing measures were especially helpful in checking the recession. Also, the increase of Federal or¬ business aided ders sentiment and here and there bolstered pri¬ vate Most expenditures. Federal programs, however, become effective soon expenditure did not enough to be of any appreciable aid during the recession. During year which ended this June, Federal expenditures—de¬ spite the recession — came very fiscal the close to the official estimates that before the had been made sion started. On rigidity some or even reces¬ the other hand, vance on services' the and accompanying current fiscal the which about two year, sharply rising seal? of Federal spending is still ahead of us. This is precisely the condi¬ advancing, a tion that resuonsible advocates of a ceneral tax cut sought to pre¬ vent. Prices Burins the Recession I come ture shall of now to the fourth the recession on comment,, namely, fea¬ which I the havior of watfes and orices. be¬ Over carry sale, rather than on the basis price. Although all these proc¬ esses would undoubtedly be cf greatly weakened if a recession ever deepend into a protracted deliberately out ,, < not ance, with individual mitigating insur¬ unemployment only to and improve¬ permanent in ments view to hardships, a also with the objective of in¬ but creasing the economy t6Kfa future Once succeed its we resistance of our recession. in devising system of insurance that is a com¬ prehensive in coverage and toler¬ ably suited in its scale of benefits to the needs of the unemployed in modern should be it is now the estab¬ lished policy of our government to use its power to counteract, on whatever scale may appear to be necessary, the forces of economic a early this recession. would be bettter still if we could depression, ' * There are still other respects in which the recent recession has de¬ from parted but cannot I has to here. much been that the classical model, do justice to this subject large brief. too nevertheless has it I hope sufficed first, that we are con¬ people to make prog-' solving the problem of convey, tinuing as a in ress depression, second, that recession and inflation remain to be reck¬ with. oned We of still in the early stages are and it is hard there¬ recovery fore to governmental recent see policies in a just perspective. 1 do believe that in the atmosphere . of Sputnik, in economy, we position a difficulties calmer of the recession atmosphere devise with deal to year. ? * a existed than Our in situation- politically acceptable means of automatically1 varying tax rates with the ups and downs a economic of activity. ; review My ruled toward the end of last year, a move in began this July or direction of larger Federal months after the start of recovery, the Federal budget exnenditures are spending was practically unavoid¬ expected to rise $7.3 billion or able. Also, the increased spend¬ 10% over a year ago. Federal ing in behalf of agriculture this cash expenditures—which give a year is largely a consequence of more comprehensive count — are bumper crops and earlier briceexnected to go up $10.8 billion or support legislation, not of anti-re¬ 13%. In short, we have only re¬ cession policies. These facts must cently entered the expanding be recognized in interpreting the Moreover, the p^ase of actual e^endi*"^* and swollen budget. although the private economy is steps that the government took to in proceed ad¬ the part of prices. Quite apart from this, there is an in¬ creasing tendency for business firms, especially the larger cor¬ porations, to compete on the basis * of the1 type of product, its quality, long series, spread out a uled considerable part of the decline both corporate and individual when ago, The corresponding gain for work¬ ers in nondurable goods manu¬ Once again we find over stantial One of the remarkable develop¬ ; a year business intervention. added Recent Recession the average 3.2% a than higher goods manu¬ on factures were namely, of earnings durable in workers tnat hourly the August third fea¬ a recession the scale and character of Federal came Some Lessons oi the important and states offices, unemployment Compensa¬ tion, and othdr programs. The decisions to increase spending were not taken all at once. They 3 ; One cent recession the level of whole¬ lic works, housing, stronger system. Reform recession is that the so-called to , ' level has continued to rise during recovery permitted to run an uninterrupted the Central Railroad of New course, as it did only a generation Jersey have had some exploratory ago. ^,,.'1.:' talks. Earnings of Central of True to its obligations under Jersey are not comparable to the the Employment Act,, the;Federal other roads and it is heavily Government moved on a; wideburdened with high cost com¬ front to limit the forces of re¬ mutation business. This problem cession and to stimulate., the re¬ would have to be solved before of tnem nave been operating at a deficit In this merger. - continued expan¬ accumulating experience, it would improvements sale prices actually rose 1%, be jri the national interest to seek, localities.- But tne < while the level of consumer prices practical ways of strengthening, early upturn of consumer spend¬ rose a little over 2%. Wages have them. The most useful step that, ing was tne decisive development, likewise become increasingly un-i we ;can take in the near futuretnus repeating wnat happened in ': responsive"/ to recessions. This is to liberalize our unemployment of the large some > of community sion by Some announcement of discussions being underway such against exists ; Unemployment Insurance business expansion/; it has become eontriDUied union. Wants that tne among*tnem the brought New attention has been to of the future. currently experiencing got actively unaer way. Railroad Mergers pared to ' deal /with the problems' industrial nonagncuiturai we .Thursday, November 27, 1958 which were better. Effective A second lesson of recent expe¬ is that mone.ary and credit policies can be more effective during a recession than is com¬ monly supposed. Many of us seem to have been influenced unduly in our thinking about monetary policy by the events of the 1930s, when excess reserves kept piling up while the economy stagnated. We must not eonfuse, however, rience the at state the of ; business sentiment mild recession with time a of psychology that governs at a of severe depression. Busi¬ time and nessmen consumers in our country are, normally, optimistic. This state of mind continues ordi¬ narily during a recession, pro¬ vided its dimensions remain mod¬ erate. If, therefore, a substantial easing of credit conditions comes early enough, it hasten may economic appreciably This recovery. positive influence is exerted only fought outcome would have been Finds Monetary Policy check the recession in small part through reductions they had to be, in the of interest rates. Of greater con¬ politics. Every active sequence is the fact that credit participant in the making of gov¬ becomes more readily available ernmental policy found in necessary to eager borrowers, that the to compromise. Some government money supply Is increased, that officials doubtless feel that if the liquidity of the assets of both their theories had prevailed, the business firms and individuals is out, as arena of So also do many private citizens, especially those who irav thupder from the safe retreat of a univer¬ improved, and that financial kets of are easy most stimulated. credit promptly The mar¬ effects apt to be felt by'smaller busi¬ are "government. Thus, in the course year were less than 1% below the a long stretch of history, it was sity. There is little to be gained, nesses and the Homebuilding in¬ "of the recent recession, corpora¬ peak of tho average level of however, from imaginary recon¬ dustry, but they tend to ramify quarter of 1957. By Febru¬ tions generally maintained thenand to permeate the economic ary retail trade had stabilized whnle^ale prices to fall briskly structions of the past. Let us try, dividends at an unchanged 'm is their custom months of an rate, in the early economic setback. the Treasury absorbed On its part, and soon rise was to began improving. This communicated promptly wholesalers and to manufac¬ system. durhv* the business the dclinmg rrhase of the cycle, /. thereby erasing adva^ep curred that during norma^v the oc¬ expanding instead, we can to tvTO' what lessons extract f^om recent wvirfW- Vi£k experiences, billion The increase of in v*«*menfs. commercial rsome bank $10 in- the easing of credit made possible between Sep- Number 5798 Volume 188 tember, 1957, and this May I * . . The Commercial and Financial Chronicle was, factor of real signifispeeding economic reco-very;"'-.--.' \ think, a v in cance T ifi.fr I.. .. 11 ■"■■«... "n. once again raise such as , decision a salaries Federal to or to pay not, however, of this character A: decision^; for example, to spend more on public works will necessarily involve a sizable lag in actual expenditure. The prepafinal or of construe- review —— . , , n<?mlc health and progress. It is that precisely for must seek we this reason solutions both and in a constructive. The suggestion, which promptly spirit. . zealous about is is Implications oi checking recessions, counsel of despair. a If we ever ^ ; spec-. anc* disease? only Not consuming. that, but anti-recession policies, but to im- construction once st a jsrss The lags modern that the does problem differ, in ^this sort ^ jtong othef!... things the Soviet Ujiion really^ invented economic asslstanbe to hthdr countries. many SS/ Still another of themselves lesson to hear some in control. have .consequences which, for betover into later periods. Thus, the. Federal- spending programs inaugurated, during the recesstmviaken together^with the recent behavior of wages and r will .recession ., many of worky0ut that this in< s^art dmertd minds policv the pwThe judgment my is |re eifective,^it will be chiefly and , le4i private spreading belief that 1 Uving in S31 .Certamly the cfrS^ZtehTscarofFed"- the ited. eral scale^°f Fed- mmished_ any on credit of a general of shift public our • which set was in ™F,5ye^eHng restraints credit ,?«?raint, cause uneven impact It may be he have have an an public and pri- on vate enterprise. a also hut - front- or the fiscaI that often review the need . and tend to subsidies to devise raise — prices better all of We defenses against monopoly power whether jt crops up in business dealings or go a public spending program. in labor relations. We need to esinvolve, of course, a deficit, *tablish local productivity councils, but it can make a considerable composed of civic leaders, busidifference to our economy how ness executives, and trade union the deficit is achieved. A broadly officials, to spot industrial wastes based tax reduction is likely to and promote improvements in efhave prompt effects on private ficiency. We need to review our spending during a recession, while tax laws, with a view to carrying the effects of public spending may out reforms that may spur the not come until the recession is nation's productivity. We need Both , When finally begin public expenditures rising, they to keep a firmer rein on public expenditures in times of advancing prosperity and develop better budgetary controls over the progress of expenditures. We need to may stimulate the economy when special longer deA concentrated bunching stimulation sirable. is no expenditures, with consequent fears or pressures, seems less likely to follow a tax reduction. Not only that, but if the tax reduction were designed so as to stimulate investors to find ways of enhancing * the effectiveness of monetary policy in equipment, it would release forces tending to imnrove nroductivhy making within the Federal Gov- of inflationary new economic, financial, and political environment. We need to improve the consistency and our co-ordination of economic policy- replace obsolete plant and and to reduce costs at still ern^ent. so that balanced judgment may be brought to bear on both the long-range problem of inflation and any immediate problem of recession or substantial later times. 5 T pome lesson simply of finally the to the gravest' Jess reason than now have even before to expect adv/fc/i/th/price level normally unemnlovment. recession, which is that we occurs whkA during business during the recent less developed areas the target of wSw„ ^S^ri^ive ^aX expUld nin^mlUion tons® steel annually 240 million tons of of hundred million tons of coai' 180 million tons of grain and its natch- with over. Sf Khrushchev plrlod Soviet UMo™Cs made the enormous lectri f Many Other Suggestions whicb useful to observe that difficulties the "„,t an , £t . tax reduction would avoid some of } "Iterv tn^anv^ event in Perhaps • amount of kilowatts DOwer satellites and Together with Communist the Soviet Union during a China peHod has extended government has evolved more than two billion dollars in through the years in the form of credits to the less developed coun. price supports, import duties, im- tries. In that same period the £Qrt 'ta w regulations, total trade turn-over of the Sino- a nhase not was likewise form woTk orspeciaT^egLlatLn^that four-'year ^ ^-ioinv perhaps td\do chestrXd age on : rn^nue^nofonlv T™' Fed evLnd mref ar^nnw fn r.mdiv and essentials of economic freedom. the>s. toward the economy sector, an Hence conditions. • oil/six but account tightening that occurs_in ar ^ no terest nosition or the agricultural front, all these and others, without however interfering with the fron^ will not be di- expenditure V^i>l' a since the end J S ac ^ w and we economic offensive This is orof inflation. by rebiius' references once 11 iat is accomplished, we to the rough goals of its most resj. g ,0 work not merely on cent 'seven year plan boasts of .C,nrl.e«? reC°Ver^' T° the expolicy enterprise u 4.1 i? ex-/&Un eSoS "thl Soviet1showed in- in5uded tent that the new monetary proves -• mi * in ofjth* reasonable/stability consumer th'e private ascertain ifSSSSi to so Formbsa ascertain relentlessly forward and Push wav Act Employment the and price level will be plicitly among the high prices^ have, bcen^a^ major, factoi 0hjectiVes which it is the consin exerting expectations of tinuing policy and responsibility tion which ..are now spreading. Q( the Federal Government to dangerously. In .these circumpromote. Such a' declaration of stances the Federal Reserve. au^oral b the congress thonties have found it advisable _wjth regard t0 price ,is to begin restraining credit ex- the: most effective action that can pansion ata very early stage:of now be taken to arrest the dani the ^»v may . take eff6rt to ticulars spill worse, free world, brine-inflation under reasonable is, that, to check. that areit the policies undertaken or anniversary suffice to curb f. - : mind: ter Union.7This, silver major , reforms • are required to ... face the year question what in period. The Department , thJ State be- betw^n ^r g^ve^ direction of Communism operation in tbe direction of our own ment and private business. Thus western system of individual lib- a group of distinguished Amerlerty? The test may well lie in can citizens under the auspices the question whether they will, of the Business Advisory Council have the patience to adjust their normal the to time lag. of the Department is conducting the how dimension to gram Tbe ®perations our foreign aid pund year repre- mark Basically it of Commerce study to ascertain government can would like to refer to I hope for the less de- ^ ye^op^d Countries a more China's Brutality pro- began which early this which State made at a Secretary our re¬ of Seattle last week incidem tethe meeting seeks to meet their problems since the Colombo Consultative Comit .provides financing for projects mittee which discussed the imwhich are economically sound but POjrtant problem of economic whicJ) dQ nQt megt the sU.jct bank_ pr0gress in South and Southeast ing requirements of other sources Asia. Mr. Dulles, in referring to of capital. It is unique in that the fact that we live today in gn borrowers can repay loans in their era when the raising of {living own currency as well as in dol- standards and-, the enhancement lars. Its operations focus to a of the dignity of man are essenlarge extent on countries with tial to the harmony; of nations the lowest living stendards. Of and enduring peace, discussed tee course tt does not make loans n°^ being imposed by wben there does not appear to be the Chinese Communist regime^on a reasonaWe chance of repayment, some 600 million people of the but it does take greater risks than mainland by a backward system some financial institutions could of mass slavery called the comaflord" " P™vides a source of mune system: free world financing to help these "Under the Chinese 'Commune' Pec)Pies build the productive fa- system, the human being is sought cUiti!s needed for economic to be denied individuality and grow'h: Good harbors, port fa- personality. He, or die, is treated cilities' railways and dams. As as a mere material unit, valued J0U nia.V know, the Fund started only as a laborer for the state, operations last January with an He loses not only what littie.p(0|)» appropriation of $300 milUon. It erty his masters have not already *'eceived an additional $400 mil- confiscated, he loses his home and llon. appropriation last August, he loses his family. Ill the comDurlnS the first six months of its munes, aggregations of 10 to 40 operation it received application thousand 'all purpose workers' for loans totaling about $2*4 bil- live in crude dormitories, with lion- Jt is expected that it will men and women largely segrehave committed all of its avail- gated and children placed < in able resources within a few months. No doubt we may expect a bjgher level of lending from the Development Loan Fund wholesale nurseries The venerated graves of ancestors, famfltar mounds that dotted the peaceful countryside are everywhere being in such amount as could be spent plowed under. The ancient and wisely in the interest of our na- rich culture of China, the retional security. Of course much spected customs and beliefs ftf |<s of our assistance continues to be people and the basic values Of seven-hundred million in 1957. extended through such broad their family life, are heifer oblitThe offensive of course has been multilateral institutions as the erated in the name of the 'great accompanied by skillfull propa- International Bank, the Interna- leap forward' decreed by Peiganda, the spread of highly pub- tional Monetary Fund and the ping." ...... Soviet Bloc with other less devel- 0ped countries has almost doubled reaching a total of one billion licized International Finance Corporation. sive Ihese organizations have the spe- should not becloud the fact that c*al virtue of drawing on both implacable drive for induspublic and private resources in trialization will have an inevitamany countries. bje impact on Asian and world trade agreements, extenbloc participation in trade fairs, the subsidization of dealers and commercial activities by bloc diplomatic missions. This offensive has been further bolstered by a third element, that of technical assistance. Thus the Soviet Union's educational system, geared to produce a greater number of scientists and engineers, languages and area training to eouio them for service abroad. Today nearly n0w emphasizes iua s PrnhiAmc _ . nf 7. , , »fhe brutality economy. fhn It of is this method impossible to prophesy at this stage how lar this drive may go, but it is a Aim»rlon« . °ur government has been giv- factor to which I think this or- lnS unremitting attention to the ganjZation should give increasing economic problems of the Amen- study and attention, cas- ft recently agreed in prin- ciPle it would be prepared to participate with the nations of ~ EAStcril lnv. Corp. Up6l)S Latin America in a regional deNORTH READING, Mass.— velopment institution if there is Eastern Investment Corporation adequate support by other mem- bas been formed with offices at those areas ber countries. 213 Main Street to encase in a ing in Moscow, Prague and other In the Middle East the United ° ® 7 / * soviet bloc centers. We should States has offered the prospect securities business. Ralph P. not ^nderstimate this extensive of a financial contribution to an Reckis is a principal of the firm, soviet offensive which is being Arab Development Institution if . h t j_ it is desired by the Arab nations Forms Jaclen Securities communist technicians are active in less developed countries 3,000 and about 2,000 students from are undergoing train- TT „ „ orougnt to oeai on themselves and they contribute nerable sector of the free world, substantially to it and of course FOREST HILLS, N. Y.—Jaclen on peoples who are hungry for provided that the institution is Securities Co. has been formed wr. „ The tasks ahead of us are there- food, for progress and for better established on a fore many and difficult. They living conditions.at a time when mawpg!Sn'iIO +i generally? no/onl^to ecoSomlste their leadership thirsts for indeand government officials. of or the United States and the Soviet growth and development business-cycle policies will our not though it may.differ appreciably; of a long-range character, inu degree*..for programs of• ediK,comprehensive policy and research. we system the people of lieves that new ways to promote inaugurated.. these less developed countries will American private investment' "4,seen\® ? choose in their revolt against abroad must be found. There is with a great misery and poverty. Will they go no doubt that we need closer CO- tions, especially our own, con,-tinues to be activated and Soviet the inflationary trend. The prob- -leadership maintains its efforts on kind,iem of inflation which we face is a numberoi-fronts to sow division in systems are, of still.more formidable. Nor weapons course that they will be so g0 sr ass snsss sasaasraasst & anus. ai involved Jn are them prove Will Choose By comparison how lonS ago^ ware the. first American economic , time important step toward that expattsion by extending the Reciprocal Trade Agreements Act for a four- Economic System These Nations ters of hunger, ignorance, poverty coun- sasrstsrs&rtear V - plans, Jhe acquisition of sites, attempted to follow it, we would the development of specifications, only add to our troubles, both j Sunday, Nov. ,16, was the 25th the arranging of contracts and domestically and internationally. Bnniversary of/the establishment subcpntracts all,these essential. Our real need is not to weaken of diplomatic .relations between are working in ,2s.*5r£S3SSi« n.i:_ VUI 111161011 iJVUIlQIIllV rUllvY - less^,,u^est. be to are these programs. a_ keeps recurring, that the way to control ' inflation specialized agencies/ example ttiord than StDOO U. S. technicians — nate countries to combat the , various For Contmtlfd frovi page 6 . We recognize that the economic less developed - tion steps its tween sound and unsound policies. - „ 31 both as major projects and through the United Nations and' growth of imt.ely spreading, and it poses a r aerii^tereatto our nations eco- bonus to veterans, can be carried out, fairly • promptly. Most increases... in spending programs ration ; ^ p a are recessions, nary trend of prices that over the a taught us during the workings of our econand by the ability of ordicitizens to distinguish be- prove omy v^^^totv^fece;: re- sftsrssamss spendmg, further rises lesson, which the has cession expansions will be erased during future, as Jn the past, the limits business recessions. But; if the of- dur^aehievement as a nation prices rises dur- -will be determined by public uning business expansions, and fails derstanding- of- the need to imaverage level of tQ decline appreciably or even • • - Lag in Fiscal .Spending; Another (222$) In the pendence and sovereignty. basis of sound with offices at _ to ol QO _ T __ 102-35 Fourth Road to conduct , Sixtya «ecu- si«tance urograms which the rities business. Leonard H. YenUnited States initiated years ago delman is a principal of the firm. The Commercial and Financial Chronicle... Thursday, November 27r (£2&- OA llllfPlIvttllVin • • ; .*> of American funds is preferable to governspending for many reasons. Not the least of which is the fact that such investment assures the most economic use of limited vestment abroad ment The plain United States resources. for capital that the need is truth t>y the Free Nations of the world is far larger than the amounts which taxpayers our private reason- capital reason abroad itself the task of be encouraged to go take and can For this American provide. ably alone must strong evidence to - support the principle of territoriality in taxing foreign source in- Of Investment Abroad 1 ' — upon preserving in the world the free > recommendations as which, though they may not go as rates for the purpose of achieving Revenue Code. This is no longer far as we believe and know to be the maximum benefit of the the case. We have been informed necessary, have a chance of adop- United States foreign tax credit, of the existence of the problems tion. There is Iitiff%1l#vmllAHC TnV Av A B -B m Vltm considering \ when first we framed the averaging of foreign tax these provisions of the internal a* *east begin by benefits accrue to Company B such abroad a* keart, frm-Hnnprl irnm First r)aae j j r v uvnunaeKi .. What are the factors that condition the climate for investment abroad? What is the proper concern of the United States Government in this field? What types of Governmental programs are appropriate in the light of our national interests, What modifications in the tax systems of the United States as well as foreign countries are indicated? What has been the effect of existing Governmental programs m this field? (which come would tax foreign And it savings achieve many tax branch or other agency may on operations because its base com- to subject not is pany United • ^ r for the States United Nations of the world in this is properly allocable) or at least a rate differential such as the lourteen-point differential considered in connection with the 1954 Code. Nevertheless, it may be necessary in the light of existjng conditions for organizations come individuals and who Enterprise throughout the WOrld to consider all approaches for achieving this end in addition to those which have History is responsible tention to the possibilities inher- situation. for the genesis of the laws which this result, possible, of course, but they seem to be perpetuated by an overdeveloped concern for the bare possibility of tax avoidance in some cases. inter- make are ested in spreading the doctrine of Free such an inherently unequitable and discriminatory result as exFavors Base Companies ists in the case of Company A. Yet in reflecting upon these probwe today condone it by inaction iems to which I have so briefly and thus perpetuate precisely this alluded, I have devoted some at- received • a. a ^ most recently expressed in his was I 0Lir ^ jnternal Revenue Code as appiies to £|ncj tite necessity vate United fh those :„hpS1J tv£PrSSrW'S underlining the President s ^memSnhrnrnmittpp thp r>f ForHan Trade PoltrS^he nn Com- mittee on Ways and Means to an inittee on Wavs and Means to an ofUUnitedeastafeSs subiect ' private 5Tie5; investment berinnte/on riee T 1058 in"Washington D C ' as in- appraisal United States taxes on foreign source income which now exist under the Internal Revenue Code, But, the benefits of such deferrals through the utilization of foreign subsidiaries or foreign base comheformalistic in impact, and difficult panies are not available except at > <~ c rag ng p administer, understand and great price in many instances. The States investment apply j know no one who is historical development of the was to great emphasis that ' laws source, revenue A most charitable Q£ ^ Conpleased to note the address to the Colombo Plan fere nee. 0f apply to foreign come ' ' ' ' such income would capricious in result, familiar with taxation who does statute and the rather fragmen. kpe ^at thoroughgoing tary gloss which has been placed one of the chief concerns of my on Foreign Trade Subcommittee Policy. In considering ways and means achieve a business result. I have come to the conclusion that no reason for forcing them to do so exists. It is within our power to provide the means of organizing base companies for the conduct of foreign business operations in the United States itself, We have the example of Canada's 4_k companies and Britain's Overseas Trade Corporations. As a matter of fact we have the example of practically every other trading country in the world bef0re us to follow. involve an inherent gam and proEnactment of a law permitting yides that,in determining the ex- the creation of a unique class of tent to which gam shall be recog- domestic corporations organized mzed, a foreign corporation shall f0r the conduct of business abroad j?°t t>e considered as a corporation would achieve a great deal and do for purposes of most of the im- much to provide incentives to portant sections of Subchapter C foreign investment. Such comfsf' before any exchange is un- panies would be in a position to dertaken, it has been established utilize the earnings derived from J° the satisfaction of the Secre- their foreign operations for the tary or bls Delegate that the ex- expansion of their activities in the Discriminatory Laws . United States is facing a potential $12 billion deficit for the fiscal cies which I have alluded to. In year 1959. If statements of some this connection the impact of Administration officials can be United States taxation of foreign taken at face value, we can expect rulings to guide it. source income is of the greatest that there will be proposals durAccepting the best advice availITportanccT and will be of great ing the next Congress for inCompany A Us implementation of the public poli- they are today it is not difficult business operations. Such corpo- Consider, if you will, two com- for the Treasury Department and rations would pay United States panies manufacturing similar the Internal Revenue Service to tax on their foreign source income products. Company A at great Und that a purpose of contem- only when such income was sevof foreign investment in the 1920's. The . legal advice then available to it was, by present standards, poor because of lack of experience and interpretations. The attitude of the United States Treasury Department was then certainly far different from now. There were few regulations or a which to guide possible legislative • seek out countries such as Liechtenstein, Monaco and Pana- men to judicial interpretation has effec- risk embarked upon the unknown provide to have wondered why it is necessary for us to force our business- of a free countries of the world withplan havm£ as one of its princi- out the immediate payment of * technical matter but as a mat- tively denied the benefits to avoidance of United States tax and would per¬ ter of pobcy as wel1- How this many companies. Federal income tax.tax rates what mit maximum efficiency and ^ undertaken will be Of course, with economy in conducting foreign due and badly needed not only as vestment abroad we must, of forum in which the issues in- course, be mindful of the fiscal volved could be fully discussed condition of the United States, bv competent witnesses and in- We will begin our hearings in formation accumulated with December at a time when the the need felt We in deferral of United States foreign source income. I on upo^ itcbange is "ot in to encourage private American in- Foreign Investment Hearings - ent tax ma t are the only ones revjew Free regard business decisions and preventing our American system from being income only in the country States tax jurisdiction. carried abroad by our businessin which is situated the principal Surely if we were proceeding men. We must do something about establishment to which such in- de novo no one would support this situation. . _ The concern of the President of the questions These means manner in which, the Internal Revenue Code is distorting and the source by no prominent attention in the past. lax Avoidance issue ■ pertinent to In this regard,, among other I have reference, of course, to served. our hearings. They are merely things, I would think it wise for the operation of what is today The foreign aid program is day illustrative of items of specific those who have skill and compe- known as Section 367 of the Infoy day losing favor both at home interest in the foreign investment tence in the field of the taxation ternal Revenue Code and which and abroad. So it becomes even field. You will agree, I am sure, of foreign source income to direct began in less difficult times as more essential if we are to meet that this inquiry is needed and their attention to the proposal of Section 112 (K) of the Revenue the full thrust of the Soviet eco- tkat the findings will be helpful, deferral of United States tax 011 Act of 1932 in a campaign against nomic offensive to create a favorAg a member of the Committee foreign source income until it is foreign personal holding comable climate for intelligent and 0f the Congress which is charged severed for domestic use. This panics which were then being active free enterprise abroad. The wdk ^ primary responsibility proposal has already received utilized for the purpose of avoidsocially conscious businessman of formulating the tax laws of the some attention. ing the United States capital gains must, in a sense, supplant the xjnited States, I am particularly You are, of course, aware of the tax. Section 367, as you know, feureaucrat. aware of the need for a searching possibilities for the deferral of applies only to exchanges which system which we earnestly believe deserves to be fostered and pre- 1958 able! orglnTzed plated exchange is the avoidance ered f^°m the foreign operation of Federal income taxes. Defer- by a distribution to shareholders, ral js so deemed. Of course, re- Such corporations, and I shall refer to them hereafter as United States base companies for want of a better term, could and should be permitted to carry on all °P®Jations now conducted by foreign ohtsizT^harexporting activities phasize that .exporting activities Within 'oemissiw'e^ctiviUes within permissible activities., ,., fieldofPfoS Provision for United States base ferring again to the example, Company A has no desire to avoid Jbe payment of United States tax. W simply wishes to compete with eqaallJS,y under United States law ^^^0^ "it vestment opportunities. This it ffxe"? no°t onl^ComDanv A but flxt~ only Company A but interest to the Subcommittee. We Tn exit- ™?equfreWany ^sing taxes s0™ foreign undertaking in the form investment in the cement of or- to change ^enp ot tne domestic economy. cf a subsidiary incorporated in, „nni7atinn inflpxihilitv Rnrinp<;<; to know as a result ox our studies Further, in light of recent Ad- sav Brazil to iinow ds le.uii of siuaies The vision of Com- j *■ m 1 ing law providing for W^estcrn nrnnnnnrpmpntc aV" T vision oi oom decisions cannot prevail and are Hemisphere Trade Corporations, and travels thai Foreign Trade ministration pronouncements, we pany A, has been rewarded by frustrated efficiency is denied t rSlTr Policy cannot be divorced from cannot expect the existing level success. The risks have proved cinfroded wife Se 5 SLj He other aspects of United States of Federal expenditures to de- worthwhile The market was u I contronted witn tne not permitting any company demner ux uuuea oiaies Ppfftpm« hp maHp wuruiwiiue. me marxei was absurdity of a nation that prides siring to do * so to continue to Foreign Economic Policy. We fline. Keioims iierexan be made, there. The demand for American itself in having develoned the ^ « Kror,/Ih of the have Subcommittee come wp ™ ran have also been impressed with the fact that uppermost in the minds considering private foreign investment is the impact of United States tax policy on forof those eign however, in my opinion without ingenuity and products was there loss and Company A has known for Pall> th.eie should be substantial some time that similar markets gains in revenue from these existed in Argentina, Peru", South sources. , Perhaps more important than the facts of Federal fiscal life in appraising the chances for effective implementation' of a policy of encouraging private foreign the investment is the incomprehensible bias found in many quarters income. Among other things the Subcommittee expects that the December hearings will develop information, views and recomsource with mendations respect to following types of questions. What are States What facts the the United investment? foreign are about reasons American capital goes abroad? . What are What effects of the vestment the on host ^ such . in- country? contributions does such in. vestment make to the develon- States and other What find are an {J™ ar), busteess article the vplonment effects of on of such the economte on foreign "tax «t ortes a{ with modern dSv A imnliS not fraud ^east Evasion of United States ot united btates least Caoones ami evasion UiiUCU dc dI- underdeveloncd underdeveloped manufactures a product and {heir fmagtaaUon the the through a branch eommer- of a initiative Code of dead <5iie-irAstiAns aa^s^ Walc®mes Adv,c* and Sugfst,ons In dlscussin? thAe Possibilities of d?ferral and of establishing a specla* c*ass United States base companies for the purposes of +h^ rw,r!!ic * achieving deferral I wish to £ 5:lear ^at no "lumber of .the nrlir nSubcommittee_on Foreign Tjade ic S mSS S Policy or the Committee on Ways whir.v» A of reluctance to rid the Revenue ^00^s io hv Subchapter C r framed and fruits with of th^ n domestic business problems in mind. It does not take o^how best to^rwride the subject of how best to provide necessary ^to Encourage investment I have foreign merely at- into account the vagaries of for- tempted to explore one or two years. ComPany B watched the eign law and the policy of many proposals that have been put forexperienc1e ff Company A and, foreign countries requiring a high ward that seem to me, at this An® S-t ot sucnt stories convinced of the wisdom of such percentage of ownership therein. taxes. idxes. velonment industrial entrepreneurs S'r;dl^vJ'^r!"mittaePa'!d similar'° th;,t of Company A. For coun- tries9 tries? its r_r_ against foreign source income. 1 the countries involved. We know do not understand this bias. It it is not. arises from a lack of public Now take the case of Company at United to Africa> and elsewhere. One would because think it a simple matter for Com- internal pany A to transfer a part of its wood. hard-earned foreign source earnv,r ings to any one of the countries named and establish a similar successful venture for the ultimate benefit of the United States and education, fiom a lack of undei- g wrhich ... what forms does such investment greatest ffif&SuS flte wSrid^*££g operatlon- stage, to have considerable merit. foreign investment, decided to Thus even assuming that Com- if tax policy affords an appro'H u°^eigtl fleld m panY ft ca.n °^c^e what priate device for providing incen1 3* and*slabhs£:d. a ba^e third To ^f"table Presumption tive, and I believe that it does, we pany by utilizing this of Section 367 it may nevertheless have an pany and by utilizing this third of Section 367 it may nevertheless have an open mind as to how open mind as to how countrv country arrangement is develop- find itself unable to invest where best the tax system can be ut.U^lg the markets in> say» Argen- investment is needed because of a ized to provide an incentive. The !? tina, Peru and South Africa which statute which should have as one Committee welcomes advice and It.ls .in tbls context which we should be available to Company A of its principal objectives neutral- suggestions. I have mentioned the the • T+ must possibility of ity of impact between similarly possibilities of deferral and the potential benefits of permitting may be that we were un- the establishment of United States in the way of pew and expand- investment. It portends an uphill without the imposition of United aware of the existence of many of base companies only because I ing investment, both here and fight and behooves us, if we have States tax to the subsidiary where the * problems confronting the believe that deferral has been abroad? the interest of the United States they are most needed. Additional businessman who wishes to invest neglected in much of the thinkcountries; ^ What are the obstacles that stand view pro- as well. Its accumulated earnings viding needed incentives for the and profits in encouragement of foreign private countries may any be one of these situated taxpayers. transferred It . Volume The Commercial and Financial Chronicle Number 5798 188 something must be done, whether you know that while I appreciate through the tax system or other¬ all that has been done by this and to encourage, American other, organizations, which exist \ It is fair to state that the pres-% wise, ent fiscal condition of the United capital to go abroad and to make for the purpose of carrying our the slogan "Trade Not Aid" mean¬ way of life abroad,, that neverther States should - make deferral at¬ tractive to those in the executive ingful., It has also been my inten¬ less a great deal more, has to be ing of people concerned with this field. ' C.' .• . / tion do convey an awareness of department -who are responsible the fact that we in the Congress for securing the revenues with which to meet the government's of the United States know that bills. Deferral involves no loss of foreign traders have problems and United States since revenue by , sincere desire to do something im¬ our about them.. I would like to hypothesis every dollar of foreign earnings would be subject to tax press when repatriated to the United being the upon you your own necessity of to let advocate; States and severed from the base operation by distribution to stock¬ holders.. % Another why reason . class of United panies the should special base States ■; A. T. & T. the possibilities for better Admin¬ which such companies charged with enforcing the tax laws of the hundreds United; States.: For example, it might be provided that such com¬ panies file an annual return set¬ Treasury the amount of 3,000 mile Distant Early Warning (DEW) Line in the arctic. Bell Leboratories contributor in foreign taxes These costly Nike Missile Defense System. The Sandia Electric point that ous companies are I do of not the least the fact so obvi¬ to need not Suffice it to cata¬ the stability . +£e > e mcreases .ls aptitled. a (3) A substantial and continu- cost-cutting program. ... (4) Issuing fewer equity shares than can heretofore. addition In the to < above, , one look for other favorable forces coming into play. A tremendous the postwar expansion program is an accomplished fact and now ought to contribute somewhat to the earnings picture. Too, the vast research program of part back-log rsumed an?,?Hn^' ^. approximately $3.5 ; tir^Uv division appreciated when of months be can accordingly. notes that one have and $4.7 million at the end of the company's last fiscal period ending Sept. 30, 1957. The company " is actively bidding on proximately , Some added trusts the of A. positions T. T. and timG it is esti_ of repre? attempt foreign specialists, this all, could is under¬ we expect problems when we deal with other languages and peoples of diverse customs and ways of do¬ After plating businessman our law foreign is The this in Here, area. as /"■. I. hope, therefore, attention will be . that devoted during the course of Pur hearings by both Administration Public and wit¬ more to the policies ); n Conclusion .... , '/■■; ■< I' exhaust the tax or even cently. . to all to touch has been of a until could connection In poor very investment Investors are needed at planes or the time of testing new check-up general main- time with made test equipment, re¬ company- it is neces- estimated that these refrigera- *2 ^ } between $50 to $250 each. Several of these units have been installed 5n? ar.e n(?w £ tested on dairy trucks, boats and trailers. £ram 2 the large is very optimistic potential market '• securities: . share. equipment or for specialized pur¬ Miscellaneous equipment made include power units, air poses. f is open-minded to consider ivew acquisitions that would complfr- ment its own activities or to daiiy and food trucks, trailers, station wagons and boats, Hence, it can readily be adapted for both commercial and leisure possibility that its sales and earnings over the next two years can rise materially. Hence, the stock offers considera¬ tion from the standpoint of capi¬ tal appreciation possibilities. Caafi dividends now being paid at trie annual rate of 40 cents per share will likely continue to remain modest in which is relation to characteristic Now With Moody Sees. (Special to The Financial Chronicle) Nelson B. has with Moody ruff become associated Securities Co., Wood¬ Building. He, was formerly with B. C. Christopher & Co. for .. Dealer-Broker Addressing Service miscellaneous valves. In addi¬ of such equipment have to be used. for military have dealers a Addressing Canada $7.00 Special , arranged charge for per the entire United States or thousand. N.'a! S. D. list (Main offices only), also geographically and alphabetically, approxi¬ Cost for addressing N. A. S. l>. per thousand. • mately 3,900 names. list $8.00 We a , also supply lists on gummed additional charge. ' can small roll labels at . Herbert D. Seibert & Co., Inc. jets for several years, thus the transition apparently able to find solutions to Its adaption for commercial jet to more difficult problems, -to aircraft will be simple. Much of the company's equiprectify the, poor performance of - investment and 900 in Canada. metal stencil for every one of these firms ,ln the stock and bond business, all arranged alphabetically and geographically by States and Cities. This list is revised continuously and offers you the most up-to-the-minute service available. We that will Sprague has been making such test and supporting equipment approximately 9,000 are and brokers in the United States, , indications point to greater num¬ bers There ,. prices 25 Park Place — " SPRINGFIELD, Mass.—Clifford many years. product in the Spring of 1959. earnings of growth companies. Stock dividends w|Jl probably receive future attention. time civilian activities. tion, the company also makes ac¬ as be field with the boosters,,, hydraulic pumps, filters and $2 * sary is . clude small generally, cumulators which are cylindrical, which has taken place in that 1? piston-type used as a source of year period.; A. T. & T. has also auxiliary, or small power supply. The advent of jet-powered com¬ performed poorly as an income inflation hedge. In the : past -12 mercial aircraft with its more years a great many, utilities have complex structural operating sys¬ doubled their- "dividends while tems require more exacting tests A. T. & T. merely maintained its and check-outs. Hence, the use of long established $9.00 dividend. Sprague-manufactured equipment Thus, the buyer who purchased becomes even more important and in per management has shown ibself to be resourceful and able arid to manufacture special valves and other components .that are used in connection with the have would badly as the investor who purchased this solid blue chip equity for return. " • Therefore, it is a challenge to A. T. & T.'s management, which the many ways in Such units have fared on which the tax system of the United States af¬ fects foreign operations. My pur¬ pose has been to underscore the seriousness of my belief that eration. System is still A. T. & T. for capital gains . -even Radio A. T. & T.'s stock 12 at $200 per share. Until recently they would have experi¬ enced a loss if they had had to dispose of their shares. This has been a poor performance, for the bluest of the blue chips, especially .in the light of the substantial rise problems confronting in foreign business nor pressure purchased those engaged activities *s *ors and deep-freeze units ranging The company to $2.50 its unit will be furnished to makers of refrigeration equipment, and it about years ago, / mention to distant gains stantially in the future. During .merged into a larger operation the past year, the company has that would provide shareholders been developing and testing a with interesting growth oppor¬ small, hermetically-sealed com¬ tunities. > pressor designed to operate on On the basis of the foregoing, direct current from a storage bat¬ Sprague Engineering appears to tery. This direct motor-driven be an attractive situation in The unit would operate directly off the storage battery of a car or from an auxiliary storage power supply, while further testing is now being conducted, the company feels that it will be ready to market this medium which It has not been my purpose too sub¬ increase air systems and refrig- stock guiding the Treasury Depart¬ and the Internal Revenue "Service in- -administering these :/.. not important of all, the man¬ during specified agement of A. T. & T. is well periods and for tenance work. aware that the company's common ment v',. the future. Most are statutes. over ance 58 in the expansion stage. to the possibility of making as risk, will protectioaa The re- for these units which would in¬ addition Microwave information available to- the public little providing possessing the potential of a very surprising market performand stations in 348 cities. A. T. & T.'s . nesses about Telegraph, selling at $194, is a conservative business this the and the supporting its SPRAGUE ENG. — GHERSEN telephone system, A. T. & T.'s Microwave Radio System services tions, are used in checking out fuel systems, hydraulic systems, 80% of the channels on our tele¬ vision networks, covering 513 TV automatic controls, high and low per¬ some only stock of American Tele- & investment the United States. All In public rul¬ haps nowhere else, certainty is a prime requisite. It is not fair to expect a businessman to feel his way into a situation which may rob him not only of the %jjts of i his foreign endeavor but of his ■? domestic profits as well. : network. system controls of the 65 million tele¬ have of considered, it is the this writer that the million telephones. the tax specialist to ad¬ even opinion common & T.'s Bell phones in ings in the field makes it difficult vise T. 1,900 7,000 34,000 6,100 7,000 25,000 All factors phone combined the fact that the Internal Revenue for Lazard Fund considerable distress. about 82% regulations promulgated for the purpose of implementing those provisions of the Internal Rev¬ enue Code which provide for the taxation of foreign source income are less than full. This, along with Service has issued few State Street Investors Wellington Fund of the other countries of the world our understandable. not Boston Fund communications contem¬ about cause - T. V. Electronics vastness, around A. investment from Government own Shares Investors Mutual acknowledged that the United States possesses its technological and industrial leadership because of its advanced information available to the American largest It is readily But the paucity of ing business. fifth geographically, it is not exposed to the vulnerability of other utilities, where local recessions for the businessman and even for legal the Because of A. T. & T.'s of Liberia, Luxem¬ bourg, Tangiers and Liechtenstein pose problems of understanding standable. was fact, supplier to the government's military defense program. base. If the laws T. & of but 1960 could amount to between sentmS commercial applications. cial T. matter a unit, company's existing prod¬ ucts, earnings by the company for the fiscal year ending Sept. 30, reports, follow: A. totaled nearly As .86 1.73"/ line and only moderate new for frigeration equipment, it appears highly probable that the commer- billion. • $ .69 ' 4 1.15. 2.30 . fore, seems to give only modest recognition to the large potential increase in sales and profits thpt could result from the introduction of the company's new refrigera¬ tion product. Assuming minimipn expectations for the company's purchased, according to their latest quarterly it 52 . t . of other similar companies in The current price, there¬ the amounts they have least $ ';v 80%.- sonably priced relative to shares ma tea that approximately /o/0 or comPany s sales <are directly With the introduction of company's newly-developed 30,000 . . market. tion programs, that aDnroximatelv 75% 13% : the company's curoperations and foreseeable prospects, the stock appears rea¬ sion last year at degree a longer be necessary to to divine the law of a country in selecting a s . Based upon able to as^ i rent celerate, this company should participate. ; Inasmuch as the nature 0f j^e company's activity is in the manufacturing of test and checkout equipment, orders for such units usually come at the tail end of the development and produc- nresent < has not been tested. ajrcraft and missile industries ac- .. . pressor of last year, are now building up. As government expenditures for .. - The company feels that, it has full patent coverage on this com— and incoming or- contracts ders, following a lull in the Fall United States law would be avail¬ no & Units ' • 50,000 <100,000 who and have taken : . new profit margins: Profit Margins sales of its Western Electric divi¬ would refrigera¬ mass pro¬ orders of 'milhbh • which compares to ap- < maxiufacturing of them arises from that new as -trie other missiles. Chemical! that say . _ Present Corporation, a Western should beein to nav off in consubsidiary, manages the increasing stages "of indirectly for the military. The Sandia Laboratory for the Atomic Various investment trusts have Energy Commission, which de¬ velops, designs and tests atomic become .aware of the djangtag oil, utilities, etc. weapons. The scope of A. T. & T.'s picture in A. T. & T. m recent cpntine commercial annlications view the benefits to be expected logue them. substantial a Ballistic Missile Program. Western Electric is a major factor in our investor's the is Intercontinental our . 0 Securing more aggressively /o\ our • From capabilities and government has the ex¬ ternal financing. /nx (2) work. Western Electric constructed administrative problems could be avoided. * from such (1) More internal and less products should be people the responsibility for some of our most important defense profits from the foreign operation paid and creditable. dollars of new vested in the American Tel. & Tel. operation with the result that many problems are encountered in computing the proper amount of accumulated earnings and and this by taking several steps, such Because of their resources, its of the company's stock as an investment medium. They can achieve forthcoming from A. T. & T. eign operation for the year. At present a foreign corporation is under no obligation to inform the States millions of being spent, many and developments ting forth the results of the for¬ United v.;/'.;:-//-/ ALLEN — that,-with the facilities and per¬ sonnel available together with the those to used Bomarc and many istration present be by Treasury Department lies in would this adaptable to methods, the tion unit is company freely around air ports duction feels it can handle 100 units a day or industrial plants. In connection with new commercial jet airliners, with present facilities, [ ShouJc§ the company's ground power sup- substantially larger, productiqpi done by you, both at home and ply trucks will find increasing schedules be required, the coup-* abroad, to create an understandr utilization inasmuch as it supplies pany has over five acres of Ian ing of the contributions of Ameri- the air power for automatic start- at its preseht plant site that, coufcl can be used for necessary expansiop. businessnot only to' the ing of jet engines. Of course, there is no way.'pi United States but to the free Sprague is also active in the estimating the potential markfi and manufacturing WOT$s ^ answer to Communist design and manufedturing of for this unit. However, it that world best ^ doOjp equipment for: operation and test¬ not require much imagination fo> Imperialism. ing 6f missiles. One large console believe that the possibilities pre unit is about to be shipped for indeed large. - * - v. ~ : > V: the Atlas program. Another order On an average net sales pried has been filled for testing of the of $75 per unit, the following Bomarc. Equipment has also been earnings per share (after taxes) furnished by Sprague for use with would be indicated for com¬ Considered be 2 deferral a Inasmuch transportable on pneuso that it can - Continued from page . and the establishment of ment' is matic-tired trucks REctor 2-9570 — New York 7, N. Y. 34 The Commercial and Financial Chronicle (2226) prospects will be ex- - Wage earners with the power to We must have capital/in order the salesman who do so begin insisting on escalator,to accelerate the pace caccount to a man clauses and other protective de- ftivity increase. Yet that capita^ who was in a better position to vices that have thd-.effect-of re- iormation Mis increasingly, being secure the business may then be -inforcing inflationary - pressures: hindered by cost .increases subr gave this Others feel they have no choice stantially in excess of productiv7 loses when prospects but to become speculators, rather ity. exchanged for a good and than savers and investors. v There should be no doubt m valid reason but everyone is' If a choice really had to be any cafe's mind that the great driv* t better off. The first salesman made between the evils of slow ing force behind industry-, is the would have wasted moire time, or inflation and large-scafe unem-'profit ihotive. The great contrimif ^ would have given up, and the ployment, I'm sure riftostr-of us iion of iridustry-to run, ♦ and up the on By JOHN BUTTON - - receiving' end. In the long one no are Use Cooperation to Increase Sales , 19o8 have may •changed Securities Salesman's Corner .Thursday, November 27, .. t . Healthy competition members of a very olmtild desirable condition and foe encouraged. But even TO spot he could get more cream and foe can convince sales obtained all you members team that will if of their to sible account is now active and it looks as your . as What Is ultimate • __ __ _ a ~~ ~~ , Not Everyone Knows How to Cow * . principle. ^ a pertain lucky felence ey/ned a large dairy of just sold his land for a tidy several million to a real estate (development. Our former Wrmm.~rnm now fW V some milk them. in the rather comfortable sound be said can to get ahead of the market. Some of Seasonal brief visit. He was securities no informed weuld fce literally in stanees affect nrp<?<?nrp«? almost heroic maturity, self-discipline and in was banks whom fie faad known for years. The interview terruinated without much promise of eventual success .constantly rebuffed with the admonition that all securities Should fee submitted through the banker friend same ' The bank contact which the salesman had was He certain competitive at was a not of the best disadvantage and it did notlook very promising That he could do business through the dairyman's friend alt the feank. Despite the attractiveness of the dairyman's account, the salesman apparent was Fortunately time this our have irreparable beginning to entertain giving <up on it. the idea -of - ... Enter Salesman Number Two during us anv . , feehavlor*™hich emotion — psychology—has Influenced the course of our econlntenslfied and omy the boom- and"bust cycle' The other is our growing inability to handle a relatlvely new and virulent inflationary force in our economy. The recent evidence ability to our recession that business cope cycles use of fiscal by the have we and provides improved with traditional by more credit skillful policies, development of various that underwrite the in- of the American . displayed the life-long friend of another capacity to deal with prosperity as salesman in the organization had well as we deal with adversity been hired to fill a vacancy in " 1 am convinced that business the investment department. Sales<>an and should de a more man number two some business with the itS own cated doing bank for investment account. A view not prospects that aalesman elearly re- indi- number two might be able to do business with the dairyman because he was ment in the made investment an d^nart appointment for /nt Si nl lf u~ h inZtLnt LJ grams ! fo g a to the friendlv relationshin -pvictinp hP. tween the other hank officer and SeSnk^Wa^ tbT^wn? customer . Assuming that • SaicmrvTin rmmhrr we are now ex- ln business follow our past be- its horns and we-lace 4 netv profit system-that a large part con- of our present ^^course T>e>paid out of dividends - freni, may well be a profit Squeeze So Stocks held by the pension trust severe as to halt our economic funds. ; • : sequence ind"sltry,w+lU set us ?irmly ™ ^progress and undermirie^thef sta- ; ;> j*: ^^ > 7 TPad back to economic growth and foility of the whole economy..^ - Unfilled Social Needs. ^ that, in due course, increased cap-j-. There has been much talk in ^ I.We still have tremendous, urnital^ inYestmenl) particularly ;in \he past year or two about the so- filled social,needs. A dwindling i^od®rnization of plant and equip- called wage-price spiral-.,^Gendr- feut still- large .number of ' Ameri* hicnt, Will pick up the pace of our -ally, controversy has turned 'on can families do not earn enough . A substantial increase in capital investment in 1959 is dependent to some degree, however, on an improvement in corporate profits—a point that I will get to momentarily.. Certainly it would seem wise lor companies in need of modernization and exPansion to act now» and not toward the end of 1959, when the current advantages in labor and materials costs may no longer prevail. the question of equity-^whdtheV • to:1 support a decent American business profits are fair brunfair, standard-of living. Millions - of whether wage demands are;exces-^Americans are still crowded into sive 01* merely fair rand reason-^ big-city V slums. We need more able. I don't want to get into that schools and hospitals and more controversy because I thmk it is adequate medical care for many futile. No one on either* isade of of our people. Our facilities for * bav?11no douhf that management will make every effort, as conditions^ improve, to maintain if e+Jn^o111 °n ?pe^ahnS costs that the 1958 recession forced ixpofl quenees for all of us—the worker: really concrete about these social and the housewife just as much as problems. And I believe in au the industrialist. •" sincerity-that the rate of our them. Wp the fence is going to feel that his position is unjust 1 do see a that ForaMoment for a Moment business suggest that all of trend has in -us ^can economic our most important the aged, for the mentally ill, and for combating juvenile deling :quency life -conse- * are seriously inadequate., It takes money—it takes cess , of wealth—to an ex- do something ^so- . • „ ;.i, .cial progress is directly hinged to .the ability of busmess_to create corporate that excess of wealth. That means "V- • The Need for.Refits .In Improving unreasonable, or the past decade, r;. Profits have steadily and sharply that business must continue its declined in relation to our Gross dynamic growth. ; r„nnnt Fnr^t inflation National Product. They have been practices, maintained h0AY^ver» is child s play compared at an annual -level of That upon a growth in turn depends growth in profits commenr about $17 to $18 billion-while-the surate with our over-all economic to the Questlon of our„ ability to Gross National Product rose from growth. And the evidence is uncontrol other urgently serious about $260 billion in 1948 to $440. disputable that at - the present Million in 1957. In that same pe- time we are moving fast m the riod, corporate employee, compen.-, opposite direction, Nation increased about SQ^from... How do we stem this particular $90 billion in 1948 to $160 billion accelerating tendency toward in- ^ 1957. I have no idea.whether flation and the profit squeeze? I the rise in compensation ^nd. -in think. for one thing that wfe; actual wage rates is.-just, apd. fair shoud:-concentrate heavily-on the domestlc economy. ' on an abstract, theoretical basis, helping more people achieve a One of the most ominous notions But I do think we must ask reasonable understanding of the A the inevitability and even desir- is healthy for this country and its ability of gradual or creeping in- people. I think it is a question of flation. Many people seem to have just as deep concern to the Ameribought, lock, stock and barrel, the can worker as it is to theTfidus-. idea that chronic inflation is es-Trial manager. :; sential to economic, growth. <■ All of the evidence of: recent . Of course, no: one advocates years points not only T© a. conrapid inflation-they merely sug- tinuation, but to an acceleration havior patterns. In all probability Yhen recovery is already well undeLwa,y' 8 Y °^mpames will gest that J.; , a slow growth of twn a man £ Let's remember, too that pur th£n • a few customer suddenly realize that their present percent a year is not really bad. ?la"t ^ obs®lete °r their capacity The trouble is that the effects of firsttrn^ SSSrfrnm ihvZZl ^ ^equate. Everybody will such inflation are cumulative, fhc hank ^ 5°•1I?.ove at once on costly They cause great hardship for nS Z fSnJS ^ Tn~ hudding programs, creating those with doUar savings and count ovpr tn him mJn log jams m^the building and ma- fixed income. Moreover, there is of more favorable and flexible circumstances, asthe cost basic social advances have bee^ of living cancels out the advances made possible by a ccmtinuous jn m0ney incomes and as rising growth of real wealth, spurred foy prices put a damper first'6n-s^es the profit incentive. Let's.remem7 |nd on employment.''When J>er that more and more Ameriprofits sag too faL induStfy piilfe cans have a direct stake in'the inflattonail^bbom- set of P^hlen". The ultimate / h«pe of many, econ°m}sts.that a resurgence m the auto I think most Americans would our system is doing c ^agree*• that itys ever,to take h?ld of the American whether the failure--of (profits ^..problem.; mind ls the widely neld theory of keep pace with economic growth. % production pro- " penenemg^a strong economic re?ov®ry>. what, ??iU happen if we due new as hhntoJtefabthcordial^and Z, ^-o^iouslv a as hnJnL > others in ' • Iong"run tendencies in the econ^+Ty' t fact+ that a* P^fP1 job in limiUng booms and ^ ^be a temP°rafy ^ ™ busts BusinesT itsllf is Tust the+ inflationary rat race should „?uch pfey t^psycho og cal forces ^ be P+ermitted \° take+£Ur eyef is the general public it has off. what. sefms. to be tbe ^.ost tended in the past to accentuate ^US S1?gle lssue confronting him with the (other hank officer and salesman number two frmnri eratiw of our ability to resist *nf prnnnmic rvHes . are „ other circum- tive now ^ingS^SeSm^ friend timing we ing on fixed incomes, school teach- amazingly well; and -that it can ers> Preachers» and civil .servants go on working - better and better who have no escalator clauses in as we understand it better ^and hand- Gradually, however, 4t gets .improve upon it. 1 i - ' is efflc began depressions and insecurity as far n^iS^^r« ^ toward family—by whole group of so-called built-in economic stabilizers. We have not, however, the or . the A thing economy. yet. . in Particular about our economic °ne 1S the extent to come Just about jthis time a .new face entered the picture at the bank, done n^s 0 create concern programs * excesses not damage—as and, although the salesman tried several times to-do business with this prospect ;Tie was decade. past many of sort kind of economy factors specific markets for business, in educaHon, in our national political life Sekm If reiy solely upon the ad- #nd in our international relationvfee of a iriend who was an ofships. Much economic good has Keer in one tot the commercial .come to us in the fey faiia and that fae our a °uu°ok °n the part oi fousiw*",, W,'" ,help su^tsurt'rfly to the' about a sound ^nd^gradual an appointment, this salesman its way of life, indeed for its very fttiaUypnet (the dairyman and they -survival This is a time calling for a this inevitable in for that confronted with the against how we were living 30 or 20 years ago or even 10 years ago. We ought to look especially hard at our progress over the past dec-r ade. A lot of things which caused tect themselves—small'saVe^, old people, widows and children Jiv- V nation of at how^we are living -today as us Actually, inflation serves no one! .back as the industrial revolution It first hurts the weak and The have been eliminated. A l qf of "poor. It taxes most severely the new things which make for stabilT savings of those who cannbt pro-*4 ty: and progress have been added. and to- toe u™"g1^thanfver Cm eneaeed " Hut a calmer, steadier, more ra- Time for Self-Discipline ^ : • nurine-this entire neriod ucoqepaying securities. . overtime production in an attempt D looking • ~ th#> " - hope that we can learn it sooner by learning the obvious Tessbri from the limited experience we have already had, rather than later; v efficient than I think this After MNI months of trying had v , our whoIe population, in cer- , inflation is inherently evil.T** to a DvaomaviIvv W1IH 11 OSUvA llY tain respects. faun and had have know about cows to be able to Mvilla ^ laxness expediency him That foe ought.to try and do You ^you _ alternative"*61 the j Let's not forget that our. present slow inflation would be opeh To system ; has brought ^ about the for very long.' f. ^ ^ 5 *' 'highest levels of real -security and Sooner or later,, all: of "us are .social well-being in the history going to have to face the Tact; that hf man. ; We ought to look hard when basis of low off that us the client, yes, even better made, doubtful there is an opportunity to reciprocate, he will benefit. Meanwhile the firm, the individual all are better oft. be nece^ariiy'KdVe'wedlth^thatj has wade wuch of and if -it:did/Vit'4is'-'-that-progress pppible/^ -. harsh reality of runaway inflation, only a jew .years ago has now foe- and economic operation of our OOtte Valuable ©ity real estate, businesses. Too often we have Atom # ^igo # iwend of one acted on the salesnKJn m my ©ffme to!d to next jivst pciQe {property that was' ^00 much the choice does not a associates.to and account M considered way put inJ;he country ^ of his one the ^ocialfprogw^ would choose the former. But such it pos- ~~~ llA^llNff V6 A11II|| tial 'area grow pnd expand so that of the some materi- , CotltlTllied JTOTR Her© in my town, like many Oibers, W© have seen the residen- for obtain salesmen, and 6MigM It for Salesman n advantage. Here is an example of Number One. how tworking together can create The next time there is a similar business and develop new clients, sales problem, which other men Milk have would hot time if the ice has been broken all around. can policy such a work business alized. As it was, he made bossy in five minutes than his customer could in 10. The out of old spirit of coopworking harmony success es a ©ration this among important in achieving more group that the start. They talked cows, farms, feed and milkin5 to a point where our salesman was ready to bet a the organization is sales a u man t ^ ... , _ • > Advocates Educational Job ^ a way Somehow we must fmd to inform and sell Mr. and Mrs, /. -America on the essential futility and, wrongness of the present .course ef events. That's not easy to do..Many will say: "Look who's Talking. You just want to hog it of this trend. L 7,T kWior yourself." Tt's not easy f Obviously, under our economic because you are in effect asking system, capital formation -and people to place limits on how far therefore profits play an .essezrfial'^ and how fast they can increase role. They are, in the,words,of Their paychecks — not their real one commentator, the. seed corn income, but the dollars in the pay , of our progress. . envelope. That's the tangible thing delivered tomer, .in cows -on those programs as the economy day that as people begin to realize ability to "invest capital fin -new cause we are dealing with a very a peak, thus forcing a boom what is happening, more and more and improved facilities andftools /powerful -and universal human stimulating inflation. Again, groups try to protect themselves and in development 'of both new hrge—the urge for more. There -is many industries will plunge from against it by means that are in- products and improved niahufac- nothing wrong with that urge expartial production into all-out trinsically inflationary. turing methods. " cept that it is insatiable. A psy- v_ls ^vas made to nears him as he had spent his ^ Arkansas tarm. y itnft together right from and _ Volume Number 5798 188 chologist defined lias . man . . The Commercial and Financial Chronicle "a as of needy., protoplasm." Granted, the possible spiritual de¬ ficiencies .of ^ that definition, I, thiols: it's a pretty fair description of economic man. We want what m a.ssv- when want we want we want we much of it as largely... we as can those wapis under reasonable control, of recognizing that others, too, have needs, and there is We learn r enough of never that ; every¬ thing to satisfy everybody. And ultimately;we arrive at the idea of sharing—not each according to his. wants, because there isn't that much to go around, : but each, roughly, according to his produc¬ has -had at least in* and add to reduced . and the see less. and is suf¬ .... before Americans less awareness understand.:/ v • j v If we can'get this one message across, then I think we can con¬ fidently anticipate a return of the , United industry is forced to stop building and stop produc¬ ing', and therefore to stop provid¬ ing jobs and job stability. ; More of more ficiently ' developed to hold - in check the 7 insatiable urge for "more" as quite another question. A tremendous educational job remains. iVnd we must hope that those who have the public's ear will participate fully in that job. The problem must be explained, re-explained,, and explained still again in terms that everyone can one. two up. and rc Whether that - People are wak¬ ing up to the facts of inflation. They are beginning to- see the effect tended purchases shorter of States to economy the path that leads to the golden land America's of milk rela¬ and dreams—a honey, and land two derbirds in every garage. of Thun- : Reserve .would overdoing credit to The / Let turn to the the bubble in of the the This is a little bonds. of part in rates the the attributable past to an rise be¬ interest of the moderate reversal in policy which be¬ increase an last rate addition to rises in the August. the in In discount rate, the Federal Reserve's target on "free reserves" has been re¬ and duced. Here again, however, the important tking is not so much the action which the Federal Re¬ has taken but the serve tion of what be secu- the required expecta¬ authorities to do will business as to be |n and ' months question then is how/ mqeh higher will rates go? It is my guess that the rise may not be of large proportions. The reasons this belief are several. First, I believe that interest degree they have already dis¬ developments!. Be¬ are now? already counted future yond this, we witnessing a decline in the easy availability of residential mprt* gage financing as funds are shill¬ ing back to the corporate, bppd field in response ta higher rates. Consequently, it„ ig likely that, barring a new Federal hopsteg program, the rate of housing starts will soon begin, a decline and, tens reduce the demand for question to be con¬ ; porate: issues; ; the total for thg first half* of this year amounted sidered is what weref/Jhe' forces to r,$10.3* billion, slightly higher which braked the decline in in¬ tharf tfee' $10.1billion figure for terest! rate& in. the first half of the Same period last year. //./,;/ the; year. Here again the forces : Still another factor braking the were complex and it is easy 'to /decline in interest rates in the oversimplify. One of the .most /first half o£ this5 year was the fact important factors was tjie shift of that' (hiring 1936 and 1957 institu¬ funds by ,; institutional' investors The next seems tain it than what However, much has time. It is my rates more been for cer¬ some guess that interest bound to go higher in the are next several months. The to my way of much whether question thinking is not will rates go - , < , such life as companiek insurance and savings, banks away from the , through }this tate: decline in shift inves¬ the precipi¬ corporate bond yields;-; Some of these funds went into; conventional ? mortgages bqt great -deal went into FHA fi¬ nancing. Contrary to. the belief of many students; of the housing market, easy and readily available These investors ip this Spring. With the ex¬ perience of sharply declining rates m 1953-54 and sharply rising rates oped in 1955-57 fresh in a credit again stimulated residential thus a strong position to resist the low rates which devel¬ .were? effect, up ilarget backlogs: of forward com¬ mitments "to. make industrial and corporate bond market to invest¬ .treshierrtiakloans. ment in residential mortgages.. In tors took refuge from built had hivestors tional, reluctant were rities mind, investors to purchase seem at low rates which were considered temporary. One of the forces which un¬ decline slowed the doubtedly ip construction; which has just interest rates was the fact that the reached a seasonally adjusted rate Treasury did not confine itself to of 1,200,000 starts. Commitments short-term offerings in the first to i provide - mortgage financing half of this year as had been made early this year should keep widely expected. Instead, the housing at aH high level the rest Treasury took advantage of the of this year even though mortgage more readily available supply of credit is tightening. Thus, intermediate- and long-term funds the shift of capital:, funds away to bring;. out i modest amounts oi. from the corporate bond market such issues. The increase in the early this year to meet an ex¬ supply of long-term Treasury panding demand; for residential bonds was thus a factor in slow¬ mortgage credit teiided to slow ing the-decline in rates. In addi¬ now decline the in... corporate yields. bond ' . brake the decline rates in the first interest of half of this year the continuing heavy demand for, capital funds by business and was industry. The lower interest rates apparently of _ whetted who borrowers out of the market the the demand had as dropped rates rose in first half of many 1957. Moreover, corporations which had re¬ sorted bank to short-term financing commercial during the high long-term sue off was their rates were en¬ by the lower rates to is¬ longr-term bank the prices of Government debt loans. and The to pay result that, despite the business re¬ the total of new capital cession rose this year, an in the first half of as institutional investors took advantage of the chance to sell of their* holdings at smaller losses. In the late Autumn of 1957., some of had of Governments low levels, but by prices course, fallen to under the lation. in rates months recent market. ' , 4' • . , rates I am why I doubt through th# anticipate is that reason will as "go some confident that the Adminis* tration can inflation the deficit even significance is the continuing heavy demand for capital funds. During the first three quarters of this year the combined new capi¬ tal issues by corporations and state and local governments units . amounted to pared $14.8 billion year bined of last year. recession, demand from the braked the to decline to reach use out their for ernment bonds. as . the . Federal of of unwillingness banks rates was reserves long-term Gov¬ In 1953 and Reserve 1954, eased in rates at that time. these In addition, months lias more been last national Gross Federal the year will index what business in have level the As business conditions improved and seem destined improve even further in com¬ to implication is that the demand for capital funds ing months, will be the sustained well increased. be and Moreover, the weeks go A on. in since rates the the rise of Summer the Under conditions tion and the rose to a Reserve further rise of interest very well be rather moderate. Board exceeded a rates in the next several months, but the extent of the rise may some¬ of 145 it reached general economic I anticipate, it which Advertising is o! Que . Reserve to take action to restrict the most useful tools is 1 ' ' s 1 ■ 4 should tend toward rising rates. Moreover, in the months ahead the U. S. has Treasury billion more of dollars new customers cash to So it's smart to place The amount may be deficit. eral securing several raise in order to finance the Fed¬ * somewhat recovery nues. business by reduced and increased tax reve¬ Regardless Treasury is to advertisement in the this, of bound your have a several billion dollar job of cash fiscal year, and it to of of upon will be necessary for the Federal that $14 billion be more evidence of. determination August, 1957. Accordingly, as ahead, it appears that there be a strong underpinning of demand for capital funds, the big Federal deficit in this fiscal year, estimated to be close was shock . financing in the remainder of this major factor interest tightening of policy as the a inflationary will may expectation of continued business a new buildup forces. I; expect tbat in coming months there will of I look recovery. have promptly to offset in and more confidence generated Federal Reserve- deserves great credit, for having moved so indicates product adjusted rate of $440 billion In the third quarter of this year, only $6 billion below the third quarter rate last year. It is my guess that business will continue to recover and that by the first or second quarter of next two few pressures. , a the in flationary on significant the availability of credit in order increase in the demand for resi¬ to prevent the recovery from de¬ dential mortgage credit. veloping into a new boom. This experienced course, commercial free in the Thus, in the com¬ great users of capital funds is greater than the record figures of last year. Moreover, we have, of Reserve which force as com¬ $14.6, billion period same this with ; depends, of the outlook for the in general. The degree course, ! greater, has al¬ new bir? Likewise, the ready moved to combat the part of the Administra¬ Congress to combat inflation, Therefore, it. seems un¬ economy likely that the inflation premium to which we continue to have a iq. interest rates will increase in recovery of business will deter¬ the months ahead. ; /" / mine the demand for capital funds Finally, as rates rise in coming and will condition Government months, the very rise itself will policy affecting interest rates, es¬ tend to. out the demand for capital pecially Federal Reserve policy. from marginal borrowers in, both During the past few months we the business and residential field; have been experiencing a fairly This, will be especially ttue- of rapid business recovery. A key state and local' government fi¬ index, the Federal Reserve Board nancing. The rise itself will be index of industrial production, for self-limiting. example, has risen from a low of In. summary, my crystal ball 126 last April to 137 in September. rates seasonally . ... Federal another . However, there were other im¬ portant reasons contributing to the rise of interest rates. Of basic suggests Still the was bursting of the speculative bubble in / the Government . securities recovery the decline little of course, excessive specu¬ Thus/ the factor which precipitated the rise of interest was, deterrent. billion, a core even half of this year amounted to $5.8 only prolonged price de¬ of this decline a At the Spring of; this year a strong price recovery had taken place. Thus, losses on sale were not so great a credit, the banks had reached out for long Governments and this had been an important factor in issyes by corporations in the first tated the entire Government bond cline. The future of the capital market and/ interest a market into increased supply of Governments came onto the mar¬ ket first half of 1957 in order to avoid the couraged as securities Another basic force which acted to tion, was so up, but how much will they rise. is¬ surprisingly high $7,4 billion and undoubtedly much of the issue-went to speculators who purchased the bonds on thin mar¬ gins in the expectation of a "ride." Instead shortly after the issue came,out the 2%s began to show price weakness and soon precipi¬ sue residential mortgage credit. This, incidentally, would be a brake on, the business proposals which would have made on : occupation. the future was the intermediate bond , suggest, crystal ball gazing about interest rate prospects is a briefly . to 4*0 hazardous commenting for the capital market and interest rates. As events of the past year Experience after the offering tion rates considerably higher today than justified by basic economic- and capital market conditions. To a deal effectively with, psychology which, has developed. It, is easy, for us to underestimate how effectively the Administration, through resisting a tax cut and Federal spending by the short-run future holds in store figure because ad¬ study indicated that $1 bil¬ on a cash basis. The this great deficit, and the realization that most of it will probably have to be financed with the commercial banks, undoubted¬ * for ceiling" Finally, I would like to conclude . ment units aie added to the cor¬ inevitable. seems The that Store? at the " same11 time1 the Treasury- made a pack¬ age / exchange / offering *1. giving duce the decline; of interest rates -very high figure of $6.6 billion in holders- of 'maturing ' securities the the'- same/ period in 1957. As a options of subscribing to either a in; late. 1957 and early 1958//" / mutter of fact, if the issues of 1 Vi% certificate.!or an intermedi¬ The Forces Which Braked the ; bonds: by state and local govern/ ate bond at 5^2% % rate. Subscrip¬ .;// Decline in Interest Rates Conditio^ Accordingly a further incre$jp interest rates in the next several . •. ,///' .. Market Still another What Does the Future Hold in keted • successfully to genuine non-speculative long-term invest¬ .... toward factor a ,// 35 recovery. recovers. amount appraisal bound Capital fascinate The indicates that this correct. However, is recent with gan lion of b long bond could be mar¬ ors. the discount set at this vance of money. It some interest Federal Reserve $1 billion of long- over ex¬ Not the least of the factors cannot be told In early June made a casn offering .nwciociry that in months hind ing .story which adequately here. a investors inflation premium. speculative Government rities market. uie likely rise be little doubt that the factor bursting is estate real and when that few which touched off the upturn was the of wave compensate for the anticipated is forces sudden stock decline in the value ; to now produced a pect inflation a premium is likely to develop in the rate of interesl sharp rise in interest rates dur¬ ing the past few months. There can is rates seek/to avoid ease as it did in Months ;•/' us which of rates is .•••• for prices must be explained in terms of this inflation psychology. The importance of this for interesl Forces Which Produced the - rise the Rates During the Past Few v basis inflationary psychology through¬ rising rates. out the country. To some degree," Sudden and Sharp Rise in Interest ./. the laid ly 1953-54. of 12 page Governments maturities. ; term; 3*4% from their Thus, they did not act to depress long-term rates; //, • ■;. / was Continued commer¬ limit to . salutary effect. two. More American working people have learned that there are limits to how far profits can be however, the . ■ Getting- this message across is by .no means a hopeless task. The recession . -/:"'/// contribution. tive This year, cial banks less production and fewey .." •_/./•.. . ,/./. / Finally, a key force in braking ' xxiey are/discovering that, in the: decline in rates was the real¬ 'our econphciic system, all groups ization which grew with investors must share in. the growth made and borrowers that the Federal possible by increasing productive Reserve still had a weather eye to ity and hjf the continual invest¬ the danger that excessively easy ment of venture capital. They are credit might set the stage for an¬ beginning to be aware that exces¬ other inflationary boom. It grad¬ sive gains! by any one group can ually became apparent in the first only lead to everybody sharing half of the year that the Federal mean and: jobs, .bringing of one . it, get, as fast as we can get it. ,/ Of course, the process of maturing is wants tionship between fast-rising wages. and rising prices and living costs, They see the relationship between higher prices and sales resistance. They {now that lowered sales . (2227) some is a good guess of this financing will be carried out by means of the the long-term bonds to sale THE COMMERCIAL AND FINANCIAL CHRSNMtK non- bank investors. The actual sale of long-term bonds by the Treasury, along with the expectation of it, tS Park Phca, New lark T J S6 The Commercial and Financial Chronicle (2228) Fature Continued Planning from Any increase in automotive requirements, unless it is unex¬ Appoints Chasi Bauer It added that "There's nothing like a few orders the outlook." weekly added that economic forecasts that 1959 will be a better business year than 1958 could have something to do with the growing confidence of metalworking management. Another angle to the improvement is that steel users have begun to rebuild their inventories after months of living off the stocks they had on hand when the recession hit. The mills are benefiting from this just as they suffered when inventories were being cut. v, This trade magazine also noted that the current recovery in steel is without too much help from oil and gas, construction and the railroads. But these industries should be coming back into the market after the turn of the year. Oil and gas and construction are expected to be strong factors in the steel market in 1959. Orders from railroads may be slower to build up. ' "The steel market will bear closer watching from now on," this trade magazine stated. "It's not so much what is happening, but what might happen that could change the complexion of the' market." '\77. > ^ • v.- 77-.►'. v: "The Iron Age," commenting further, declared no one is looking for a real bind in any steel product during the next year: "The mills have done too good a job of beefing up their ingot and finished steel capacity. At the same time there could be temporary created post newly the to Bauer on New York City, has by Karl D. Pettit Jr., President. Mr. Bauer will be responsible for the establishment development of additional Future Planning Corp. offices and York New V area. He associated previously was International News Service General Sales Manager, and with as United prior thereto he was with Financial 'Controller, and with United Fea¬ tures Syndicate and the British United Press. " Associations Press as ^ Spear, Leeds to Admit Spear, Leeds & Kellogg, 111 Broadway, New York City, mem¬ bers of the New York Stock Ex¬ cf the New York Stock to Exchange, partnership. Own Hartford Office — James A. engaging in a securities ; business from offices at 750 Main Street. He was formerly with Fed- * HARTFORD, Conn. K. J. Brown Branch | SHELBY VILLE, Ind. — J. K. & branch Co., Inc., has opened a office in the Methodist - under the management Building of Walter Age," N. Pinsker & reached Co., Inc. of Hemp- .stead has opened .y. -. on branch office direction Moskowitz. ; a New York City, at 150 Broadway, under ' the cars of > / new ; ' call cember. The 1958 peak, "Ward's Automotive Reports" declared - . «7-;7 The remaining are single-shirt operations. "77 2% over the prior week's 23,697 units and just off the 1958 peak of 24,838 units attained two weeks ago. The only blemish scene was that began Nov. 13 know the facts of life about cancer. are 800,000 Americans alive today. cancer • •. • • cured of knew that •nee a year New business contract negotiations and has yet to be incorporations rose to the highest level for any October, according to Dun & Bradstreet, Inc; At 13,633, they were 1.6% higher than the previous high of 13,417 record in set in March 1955. The October 1958 level of the prior month and exceeded was the 5.4% from the 11,251 of October up 1957 by 21.2%. They is the best insur¬ against cancer. •... Make now an for and make it a a habit far life. AMERICAN CANCER SOCIETY Free World deliveries of copper to fab¬ all-time high in American October. . Iron and Steel for the week beginning tons of ingot and steel Zinc, lead .7. . ..... „ and nickel? 7 7.. ■! . Institute announced that the as Nov. 24, 1958, equivalent to castings (based on-averaged compared with an actual rate before. the rate was *126.0% and pro¬ A year ago, the actual weekly production placed at 1,846,000 tons or 114.9%. of etr production is based on average weekly production Registered Good Gains the Past;; Week Electric Output The amount of electric energy of businesses distributed by the electric light : industry for the week ended Saturday, Nov. 22, 1958 was estimated at 12,579,000,000 kwh., according- -to the; Edison> Electric Institute. Output- improved perceptibly; the. past week. For the week ended Nov. 22, 10^; and power above that ot the previous week > and- 443,000*000 the comparable I95t. week and 1,140,000,000 that of the week ended Ndy; 24, 1956:* 7^ ; f' 000,000 kwh. kwh. above that of kwh. above Loadings Dropped 2.2% in the Week- Ended Nov. 15. Nbv". 15, 1958 were 14,291 cars or 2.2% under the prec^^^Aveek^: :--A": Loadings- fbr the week ended Nov. v T5£ 1958 fJtotaled; 6^795 cars, a. decrease of 3,502 cars, or 0.5%; belovv; tftef cO'rrbspohdihg Car Loadings of revenue freight in the-week ended week, and. 1957 a , cars,7or''15.7% below the *7 7 - decrease ot 120,103" correspohdihg week in 1956. OtttptRos»-29% and Truck Assemblies-i% Above Preceding Week Following SettlemeMt- ot Strikes^ at •; 7 •'' Chrysler Car ,7 tHe-w^k:< elrtdOd->'Nov.' 21^.. 1958,' "WardV" Automotive1 Reports,". ' increased: by 26%* by 2% with the termination* of the" walkout at Chrysler Corp; and The Budd Co. plant at Gary," Ind.; supplier of underbody components for Rambler. 7 : Last week?s. car output totaled 141,072 units and* compared with 117,688 (revised) in the previous \veek7 The past week's production total of cars and trucks amounted to 165,246 units,- or an increase of 23,861 units above that of the previous week's output, states "Ward's." Last week's car output rose above that of the previous week * Passenger ear production tor - according to and truck assemblies .... . 23,384 units, while by chartered during the first ten the highest ten month aggre¬ gate on record. The previous high was 120,238 for the first ten months of 1956. The current cumulative total compared with 116,852 in 1957 for a gain of 4.2%. truck output increased by 477 vehicles during the week.- In the corresponding week-last year and 23,605 trucks were assembled. ■. 151,846 cars - reported there were 24,174^ trucks made This compared with 23,697 in the previous Last week the agency in the United States. number months of this year came to 121,732, week and 23,605 a year ago. Lumber Shipments Dropped 8.1% Below Week Ended Nov. 15, 1958 Output in the of 475 reporting mills in the week ended 3.1% below production, according to the "Na¬ In the same period new orders were 9.1% below production. Unfilled prders amounted to 32% of stocks. Production was 5.3% below; shipments 7.2% below and new orders were 3.3% above the previous week and 8.0% Lumber shipments Steel Production This Week Estimated at 74.2% of Automakers will step up their production schedules during the final weeks of the year, but steelmakers are not as optimistic as they were a few weeks ago, "Steel" magazine reported on Mon¬ day last. It appears pow that the steelmaking rate at 75% for last week is near its 1958 peak. In anticipating a of capacity October, steelmakers we/e rate of around 85% before the year-end. Automakers over were committed to a lot Nov. 15, 1958 were tional Lumber Trade Barometer." Ingot Capacity health checkup a appointment right checkup over strike at International Harvester plants ' because they went to their doctors in time. ance a settled. The an _ up le»»lv because they didn't 7 -7 '.,;77 7 - " 77 '7;; '77"'"7 : steel service centers, that is warehouses, for 1947-1949. the past week, "Ward's" noted. Volume was forecast at 24,174 units, 12,932 hit ''Index Continued top-level scheduling also was set for truck makers them lost their lives need- • 124.5% of capacity, and 2,000,000 tons a week ago. Output for the week beginning Nov, 24, 1958 is equal to about was assembly factories have ~ two shifts in action. 260,000 Americans; 75,000 of .. a duction 2,024,000 tons. can 5%, Ford Motor Co. 3% and Studebaker-Paokard 1%. "Ward's" said about one-fourth of the: nation's car on .7 better fourth quarter than they had in 1957. Coldrolled and galvanized sheets are tight, plates are gaining, and structures are still in the doldrums.. Despite the uptrends, 1958 having are „ month ' *"• 7": publication said For the like week a month ago industry last week the availability of 1959 was on the rise as production .. elaimed the lives ot .. .. Supporting the market are appliance manufacturers and a long list of small consumers. Shipments will probably drop in De¬ week . it9* tirnt you did t Last year . 74.2% of the utilization of the Jan. 1, 1958 annual-capacity of 140,742,570 net tons compared with actual production of 74.1% the . atncer . in November will be as good as October's, magazine continued. Automotive sheets held up for two or three weeks, including scheduled production, are being shipped. of continued "Ward's," will be able to display complete variety of models and body styles before the end of CEDAR LAKE, Ind. — Straus, November; In the first 10 days of the month, they added 45,000 Blosser. & McDowell has opened ; new autos to their inventories, which stood at a two-year low-of sl branch office at Broadway and -. 38%000 units, at the end of October, The 380,006 total included* Lake Road under the direction of 250,060 1959 models and 130,000 1958 versions 7 77 in 'striving to supply their sales forces, United States cay manu.-.' Frank J." Noohah / '; r'v " " facturers the past week have all 49 of their assembly plants engaged in Saturday work,, according to "Ward's." Because of strikes, Which subsequently have been settled, ; both Chrysler 11Corp; and American Motors failed to get a full day's production out on Monday of last /week. Other car manufacturers were assured of six-day operations last week. i&you, know Chrysler- almost, quadrupled the prior week's production; effort, which was hampered by an offiee employee strike. General ; I » Motors programmed a 14% boost over the preceding week, Ameri-: about cancer? 7: .. Steel shipments the weekly production for 1947-49) Friday last. the truck 7\.:if average. capacity - on against 9,775 daily in the like period of October. Automakers the trend encouraging, but some had hoped for a 15,000 as 2,003,000 a -i 1.5 dealer showrooms reached 145,503 units. New car.dealers*, Straus, BlosserBranch : 86, up p The publication estimated output of automobiles the past week at 141,072 units, or 20% higher than the preceding week's 117,688 units and 13% above the previous high of 125,279 . units for the year recorded two weeks ago. Last week's total stands. as the best yield since -the week ended Dee.14, 1957 when output * St. Louis at Youngstown at 61, down 1 point and Birmingham at 58, up 1.5 points. 77 \ 7 • / "7...7 7'-; 7 ' ! New car sales are improving, the metalworking weekly added. Sales -"averaged 11,740 daily during the first third of November The statistical Edward V» a in follows: as operating rate of steel companies will average *124.7% of steelr a In the automotive model were favoring hot metal at the expense of dealer scrap. Kelley. Pinsker New York Office Others last week. Scrap prices declined last week in a slow market. "Steel's" composite on the prime grades dropped ,$1.66 a ton to $40.67 as weakness developed in the East and in Pittsburgh.- Mills are a special survey conducted by McGraw-Hill publication,'bri the coal import situa¬ tion in five major European countries which currently account' for some 73% of total United States overseas coal trade. , < In 1958, exports will hit an estimated 33,000,000 tons, down from last year's record peak of 58,000,000 tons. In 1959, a drop to 34,000,000 tons is likely and by I960, as current high stockpiles become depleted, a movement back up to 40,000,000 tons is pos¬ sible, the magazine states. ~ "Coal rates points; Wheeling at 85, up 0.5 point; Chicago at 84.5, down 1.5 points; Cincinnati at 83, down 3 points; Western district at 78, no change; Buffalo at 78, no change; Eastern district at 71, up 1 point; Cleveland at 71, up 2 points; Pittsburgh at 68.5, down 1.5 points; demand is also strong. than double the pre-1955 volume. This is the major finding of Inc. of Boston. • 2,024,600 net tons of steel for ingots and castings. Operations at 101.5% of capacity, up fire points^ led the district Detroit tions, "Steel" disclosed. permanent overseas market for United States coal should off to the 35,000,000 and 40,000,000 net-ton range, or more level about in ricators the total Lennon is Brown . shipments will probably be 25 or 30% below those of 1957.7 Fourth-quarter nonferrous business has surpassed expecta¬ they have been. But they are holding the leash on advance order¬ ing and pressuring the mills for quick delivery when they need it and they usually get it. As for United States coal exports between now and 1965, James Lennon Opens crated Plans, mill delivery promises lengthen.'' ;7;77.' as The metalworking weekly further reported that automakers apparently have pulled out all the stops from now until year-end. Most of them are resorting to overtime to maintain a high level of output. Still, they are playing their steel inventories close to the vest. They are using more steel and taking in more steel than 1 -will Dec. on trade periods of tightness admit Raymond E. Grabowski, member change, books to restore confidence in the This been announced throughout the Metropolitan observed. paper Regional Sales Manager of Future Planning Corporation, 350 of Fifth Avenue, pectedly sharp, will simply offset seasonal declines in construction steel and tin plate. ' ' ' ' ' Steel mills last week operated furnaces at 75% of capacity, down a half-point from the previous week's rate. Production was . Charles of appointment The Thursday, November 27, 1958 shipments accumulated at steel plants. One company estimated that finished steel stocks increased by 700,000 tons in October alone. 5 page ... of steel before local issues closed their assembly plants. As a strikes result, delayed above the like week in 1957. •; *•} . *- ». - Business Failures Continue to Fall in Latest Week Commercial and industrial failures dipped to 260 in the week ended Nov. 20 from 274 in the preceding week, Dun & Bradstreet, Inc., reports. At the lowest level in ten weeks, casualties fell considerably below the 308 occurring a year, ago, although they Volume 188 Number 5798 remained above level, 3% more concerns ; of 1939. All 207 the of . . The Commercial and Financial Chronicle in 1956. Compared with, the prewar failed than the 252 in4he similar week decline Increased buying of television sets and automatic dishtotal volume in major appliances up to com¬ parable year ago levels. While sales of floor coverings and drap¬ eries matched those of the similar week last year, interest in was, ers concentrated failures in the previous week and were off slightly from the 34 of this size last year. Casualties with liabilities of $5,000 or more edged up to 229 from 223 a week ago, but failed to reach the 274 recorded in the was liabilities sunder $5,000, with which fell to 31 among from week. excess ... . . . Volume coats and suits ; Manufacturing casualties rose moderately to 43 from 41, but 22 from 25. Fewer succumbed than last concerns lines except service where mortality was even Six of the nine major geograp: ic regions ■ week decreases. South Atlantic The most States, off to occurred the Over-all wholesale 1 • . blouses. Moderate gains occurred in 1 the level of a week at a was Prior Week's Level radios Interest ih television sets and year ago. unchanged from the prior week. Purchases of floor coverings and linens were steady, but sales of draperies declined and chairs Increased buying of bedding and occasional tables helped moderately [ Commodities quoted higher in wholesale cost last week were wheat, corn, oats, cocoa,1 potatoes and lambs. Lower prices were noted in flour, rye, lard, sugar, eggs, steers and hogs. . The index represents the sum total of the price per pound of 31 raw foodstuffs and meats in general use and its chief function is to show the general trend of food prices at the wholesale level. a over boost over-all furniture volume at wholesale* that of a week earlier. Wholesalers reported •slight year-to-year declines in volume of toys. i . # Buyers stepped up their orders for cotton gray "goods the past week, particularly print cloths and sheetings. Appreciable gains ; in sales of industrial gray goods occurred during the week. Slight increases in trading in woolens and worsteds were noted and volume in carpet wool matched that of the preceding week. Index Rose Slightly England ? dyers and: finishers reported com •.•• Slight price increases in grains, some livestock, tin1 and rubber " offset declines in steel scrap, flout; and cocoa, holding 'the' ghttbVal commodity price-level slightly above that of the prior week. The daily wholesale commodity price index, compiled by Dun & Brad- 276.81 on Nov. 17 from 276.66 a week earlier. It compared with 277.33 on the comparable date a year ago. Although grain trading remained close to that of the prior week, prices moved up fractionally. Wheat receipts in'Chicago declined and prices rose somewhat at the end of the Week. Both domestic and export buying was sluggish. There was a slight pick-up in purchases of corn with offerings light and prices up fractionally. Trading in lye was steady leaving prices unchanged from those of a week earlier.* Limited supplies curtailed trading in rose to ing >orders. - j iyj, New appreciable rise in in- an 4 •• A, marked ^nbrease iri ptjrcha$es:;b^;frozeiVi foods; occurred* during the week, especially 111 citrus juice concentrates, causing wholesale stocks to be reduced appreciably. The call for fresh produce, fresh meat and dairy products moved up moderately, while interest in rice, flour and sugar was unchanged from the prior week. on a country-wide basis taken from as the Federal Reserve Board's index for the week ended Nov. 1958 advanced 3% above the like period last year. ing week, Nov. 8, 1958 an increase of 2% was 15, In the preced¬ reported. For the . four weeks ended Nov. 15, 1958 a gain of 3% was registered. For the period Jan. 1, 1958 to Nov. 15, 1958 no change was recorded from that of the 1957 soybeans during the week and prices were sustained at current Interest in soybean meal expanded substantially. \ There was a noticeable rise in supplies of flour during the an rice a increase A of 3 % above that of the similar period a ago, year change to colder value decrease of 2% showed a In preceding the in week encouraged City for the week ended Nov. 15, 1958 from that of the like period last year. increase of 2% was reported. For the four weeks ended Nov. 15, 1958 an increase of 2% was noted. For the period Jan. 1, 1958 to Nov. 15, 1958 an increase of 2% was registered above that of the corresponding compared with 172,886 a year ago. Sugar trading and prices remained at the level of the prior Little change was noted in coffee transactions, and futures the week, Nov. 8, 1958 an tered serves afford. can it Unfortu¬ wholesalers reported a themselves. The to Administration steer wise a has in course spending mood. A 1 'C., i t"'i • With the - -" • ■ citizens our will make it since the 1952-53 crop year, when it stood at 18,164,000 bales. United States exports of cotton in the period ended on Tuesday of, the past week totaled about 64,000 bales, compared with 54,000 in the prior week and 109,000 in the like week a year ago. Exnorts for the season through Nov. 11 came to 855,000 bales as last year, against 1,334,000 in the comparable period . representatives in the next session of Congress that they want to. see sound fiscal policies pursued. There are should we siderations sert are find to age those who not above what human values. an state that place budget example man has unsound fiscal over not around rainy weather held con¬ sumer buying in many areas below the prior week, over-all retail trade slightly exceeded that of a year ago. Noticeable gains over last year occurred in the buying of household goods and food products offsetting slight declines in apparel. Furchases of new passenger cars moved up again during t e week and year-to-year declines were narrowed, spot checks show. The total dollar volume of retail trade in the period ended on Wednesday of the past week was unchanged to 4% higher than a year ago, spot estimates collected by Dun & Bradstreet, Inc. reveal. Regional estimates varied from the comparable 1957 levels by the following percentages: South Atlantic States +4 to 4 8%; West North Central +3 to +7; Mountain and Pacific Coast -f 1 to 4-5; New England and East South" Central 0 to 44; Middle Atlantic —1 to 43; East North Central and West South Central v .0V)R kVpA- <FMfm \ O rn (/) * Although unseasonably warm and States —4 to 0%. Furniture stores recorded marked gains over a year ago sales of dinette sets, in upholstered chairs, occasional furniture and the aver¬ suffered when policies have been any considerable period of time. Mortgage bankers are with the investment of entrusted signifi¬ portion of the savings of the people. Savings have, built our economy—savings made a American the assurance that the value Without healthy in this assurance, substained growth i 's-$a the American economy would be im¬ possible. sure that in the future, as past, you will give full sup¬ port to the sound policies and pro¬ grams necessary to our continued success in preserving the integrity I am in the our currency. .-v. - Slightly Above 1957 Unseasonal Weather as¬ I have yet where the lot of the pursued con¬ they • Trade Volume in Past Week Rose Level Despite known- their to J. 1' moderately. The total domestic supply of all cottons for the current crop year was estimated at 20,600,000 bales by the New York Cotton Exchange Service Bureau, New York Cotton Exchange down the smallest amount deficit facing are i i trading last week brought prices on the decline in cotton ex-i and the recovery well under way, let us hope that we substantial gain in hog re¬ preceding week's level, but with a falling off in transactions, prices declined a bit.< A moderate cut in lamb purchases held prices - < k' tried its penditure programs; but the Con¬ gress at this last session was in a ceipts and prices, as a consequence, dipped moderately. Trading was close to that of the prior week. Cattle receipts held at the somewhat under those of a week earlier. that programs once en-* tend to perpetuate' prices held close to those of a week earlier. Chicago test true to be seems into the useful and a in the light of purpose expenditure of period in 1957. week. should meet we nately, Every Federal ex¬ requiring necessary what firm, dollar. and store sales in New York Cocoa prices advanced appreciably at the beginning of the week, but fell moderately at the close, finishing below those of a week earlier in slack buying. Cocoa bean inventories at the end of the week in New York warehouses amounted to 63,867 bags, the to maintain of the dollar would be maintained. late According to the Federal Reserve Board's index, department high level. of penditures on weather shopping. prices at prior week levels and domestic transactions continued at the resources we are determination cant trade observers estimated. week, and prices were moderately lower. Wholesalers reported a slight dip in flour trading. Prospects of increased export buying held period. Retail trade sales volume in New York City last week showed levels. financial not unlimited—if our world Department stores sales them from procure of whether it was | moderately, rather to program sustained high level. volume remained below Following four weeks of consecutive increases, the wholesale food price index, compiled by Dun & Bradstreet, Inc., was un¬ changed on Nov. 18 yt $6.38., It was 1.6% higher than the $6.28 of the comparable date last year. but are There was a slight rise in the buying of refrigerators, gas .."ranges, laundry equipment and lighting fixtures last v/eek, but Wholesale Food Price Index Last Week Held at an banking system increases the supply and hence, the pur¬ chasing power of the public. The problem facing the Treasury is not just to find the necessary funds in earlier, while the call for furnishings expanded somewhat. Interest in children's winter merchandise lodging money government's Spring [ coats and suits. Volume in men's topcoats and suits remained at fell below 1957 in the other five regions. 111 Latest Week jewelry and bags, that the right sources. * Thus it becomes clear that the buying of women's apparel equalled that •of the comparable week last year. Fill-in orders for Christmas ; merchandise moved up from the prior week, especially in hand¬ England and Middle Atlantic States suffered increases during the week, with the total in the latter region edging up to 89 from 85. Mortality exceeded last year's level in the New England and Middle Atlantic States, held steady in the East South Central street, Inc., little change in purchases of children's week. New ' was year. audience increased proportion of the Fed-* eral debt with the commercial comparable early shopping for Thanksgiving helped boost total food sales the past week. Housewives were primarily interested in canned goods, frozen foods and some dairy products. Sales of fresh meat, poultry and baked goods matched those of the prior from 13. In most areas declines were very slight; the Pacific toll stood at 62 as against 67 in the previous and the East 'North Central at 34 as against 35. Only the •' levels. There this to especially in topcoats and suits. furnishings and sportswear matched It is not necessary to explain tern. The call for men's clothing fell from a year ago, Some Central, down to 6 -'Y;;: sluggish. 28 and in the East South 19 from Wholesale Commodity Price men's apparel from last week and Mountain States, but of year ago in all in was both the prior week and Sales with 1957. reported week-to- declines noticeable year women's apparel fell noticeably from the prior year-to-year declines prevailing. Best-sellers sportswear, dresses and fashion accessories, but interest in were declines prevailed in all other industry and trade groups. The toll among retailers fell to 122 from 136, wholesalers to 29 from 31, construction contractors to 39 from 41, and commercial services to in week, with slight v ... from boosted was down somewhat. Early Christmas shoppers stepped up buying of gifts, glassware and china during the week. their Sixteen of the failing businesses of $100,000 as against 29 in the preceding ' Continued 37 linens 51 comparable week of 1957. had liabilities in (2229) bedding. - week's the . 38 The Commercial and Financial Chronicle... (2230) The following statistical tabulations covei* production and other figures for th* Indications of Current latest week Business Activity week Latest AMERICAN IRON AND Equivalent to— Steel ingots and castings capacity) (per cent Previous —Nov. 30 or £74.2 month available. or month ended Month Week Week STEEL INSTITUTE: Indicated Steel operations Ago *74.1 §2,003.000 *2,000,000 oil condensate and Ago 75.0 2,024,000 AMERICAN 1,846,000 of (bbls. Crude to runs stills—daily average (bbls.) 6,567,885 7,003,385 6,892,585 Intercity 117,755,000 7,686,000 7,613,000 7,797,000 6,831,185 Nov. 14 27,654,000 25,991,000 2,286,000 2,452,000 12,798,000 12,352,000 12,704.000 12,074,000 Nov. 14 6,744,000 6,849,000 6,838,000 169,309,000 N°v- 169,210,000 170,361,000 at— Nov. 14 CONSTRUCTION - Stocks at 32,369,000 31,520,000 33,503,000 165,354,000 161,341,000 171,940,000 67,251,000 68,095,000 68,020,000 643,795 554,425 \ 658,086 571,850 "Z of 563,777 $374,316,000 123,630,000 $251,425,000 $332,274,000 103,812,000 165,063,000 250,686,000 147,613,000 167,211,000 To North Nov. 20 108,890,000 197,415,000 120,849,000 143,624,000 To Europe 53,271,000 26,764,000 23,587,000 —Nov. 15 405,000 419,000 472,000 DEPARTMENT STORE SALES INDEX—FEDERAL RESERVE SYSTEM—1947-49 AVERAGE = 100 —Nov. 15 157 148 146 12,579,000 12,378,000 12,174,000 To INDUSTRIAL) — 468,000 Month All 152 12,136,000 260 274 275 , 61206c 6.196c 6.196c SOU 41 $66.41 $66.41 $66.42 $41.17 $42.33 $42.83 $32.67 ' Nov. 19 28.650c 28.625c 27.150c 29.300c 30.550c 29.400c 13.000c 13.000c Nov. 19 12.800c Nov. 19 12.000c 12.800c 12.000c 12.800c 11.500c 11.500c 11.300c 11.000c 24.700c 24.7000 Nov. 19 99.500c 99.250c 96.000c ' 89.23 88.57 88.02 91.09 90.48 90.20 90.06 89.02 94.71 94.56 95.77 93.08 91.77 Reading 89.92 89.64 88.95 25 84.17 84.04 83.40 87.86 88 13. 8« 38 90.03 90.34 89.64 89.37 Nov. 25 92.79 92.64 92.35 91.62 LIFE —Nov. 25 3.51 3.56 3.61 4.38 4.40 4.41 4.48 lov. 25 4.07 4.09 4.10 lov. 25 Baa 4.19 4.21 4.41 4.42 4.44 Tov. 25 Group —.—— Public Utilities Group Industrials Group 4.85 lov. 25 4.55, lov. 25 4.37 4.86 4.91 5.10 4.55 4.39 4.22 395 .'3 4.44 4.23 395.3 4.25 4.46 - LIFE 4.30 390.2 345,836 283,024 240,710 313,809 311,196 314,445 290,265 Nov. 15 94 93 95 94 <ov. 15 431,670 460,078 433,785 Nov. 21 OF 109.69 109.48 108:60 Short Total - Total : 2,684,510 2,535,860 1,340,820 606,520 561,150 564,930 358,650 1 2,346,070 2,194,000 2,077,360 984.480 1 2,952,590 2,755,150 2,642,290 1.343,130 1 784.030 770,620 765,790 269,070 1 121,900 104,700 38,300 55,600 1 725,710 756,320 661,200 201,500 1 847,610 861,020 699,500 257,100 1,073,690 987,739 872,145 471,192 Railroads 154,700 181,680 127,320 Utilities 167,950 869,100 922,007 390,795 Banks 1,050,780 1,089,957 518,115 Insurance 4,895,170 4,442,869 4,173,795 2,081,082 541,570 Nov. 883,120 847,530 771,180 4,028,200 3,819,420 3,660,567 1,576,775 Nov. 4,911.320 4,606,950 4,431,747 1.686,273 1,553,096 1,604,009 $76,923,218 of ' $52,566,539 1,720,369 1,672,709 1,639,940 10,122 6,105 sales. 1,707,819 1,662,587 1,633,835 $76,078,809 $75,079,964 562,320 567,270 546,710 562,320 53£,"170 Nov. Other sales . Nov. sales • Nov. — U. S. DEPT. 567,270 455,820 546~,710 505,310 180,480 591,780 .Nov. 18 1,150,030 20,617,120 21,767,150 1,102,400 19,953,420 21,055,820 905,900 9,667,900 20,236,220 10,548,700 • ' 'Revised M Ba li 119.1 *119.2 118.6 117.8 *91.2 91.3 92.1 *109.7 109.9 as 104.8 105.1 90.5 126.8 *126.8 126.1 one-half cent pound. ' a on delivered basis at centers where freight from East St. Louis exceeds . < *$28,311 21,310 *21,466 22.461- *$49,777 $54,203: *26,284 28.638 $31,371,000 Z 125) $31,171,000 $31,133,000 -■ 556, 779 $5,063" - $31,742 3.45 7.82 4.15 5.08 2.75 2.98 3.74 3.64 ZZZZ-IZZZZZZZ 4.23 4.10 ; ZZ (10) 4.45 4.89 4.11 (24)ZZ 3.54 4.80 I_ZIIII__I incl. Amer. Tel. & Tel.) 3.72 4.68 $351.4 5.17 $357.5 >$356.1 Z 239.1 *238:5 240.2' ; 98.2 *97.7 102.4, 63.5 63.6 33.9 __> 33.8 32.9 43.5 *43.4 40.7 9.2 9.1 • income ZZ-ZZ 1 interest Income transfer GOVT. and contribution ' 56.9 ; face for special i *56.6 31i9 31.8 *26.8 21.5 in¬ 6.8 6.B 6.6 340.6 *339.2 336.1 $2$8,o0o,ooo $23o;ddoi<)00 $W5;boo,ooo 280,211,456 2%,475,533 -27^067,350 111,943 1(^6,4*#8 ¥02.705 ; income 64.2. 31.9 27.2 dividends payments—— j. STATUTORY DEBT LIMITATION —As of Oct. 31 at (Odb's omitted): amount that be oiitstanafng may time__-——— Oirtstandfng— any ; public debfcr 1. obligations ntlt owned by the 1.— Total gross .f. public debt and guaranteed dbligations $280,323,400 ^278,^84,(HI ^^,170,055 Deduct?—other outstaridirig public debt obli¬ gations not subject to debt limitation— f Grand tdta-1 butstariditig^-.:-^ Balance face amdtthfc xrt obligations, 125.6 IIIncludes 1,031,000 barrels of foreign crude runs. §Based on new annual capacity of 140,742,570 tons against Jan. 1, 1957 -basis Of 133,459,150 ions; tNumber tri -orders not TeporWd stntX ItttrttdifCtldfi 6'f % Prime Western Zinc sold $5,196 26,394 (25) empxoyees' Total under above authority—- UNITE,!) ; 428,269 426,090 $279,897,3(19 ^ J440.429 $378,155,742 %kT3,729,625 issuable- 1^44^57 8,102,69d ;_ L270.374 TOTO* DIRECT XNb GUARANTEED—(000's omitted): As figure. I960) 633 $28,143 Z 105.7 102.5 .Nov. 18 and foods. 91.9 108.9 .Nov. 18 Monthly Investm-"'' "Ian. $3,728 ,-•530 September (in billions): 880,800 19,330,320 .Nov. 18 All commodities other than farm $4,033" 548 869 x— Treasury .Nov. 18 foods. Meats M S. OF -om modi ties Processed ' ' ; surance — Farm products. „ August I Total gross GuarkhtCed Commodity GroupAll of $3,669 " Total nonagricultural Nov. sales Less U. TOTAL ROUND-LOT STOCK SALES ON THE N. Y. STOCK EXCHANGE AND ROUND-LOT STOCK TRANSACTIONS FOR ACCOUNT OF MEMBERS (SHARES): Total round-lot sales- . B7,700.000; $59O,O0O,O0O ^525;200.000 180,480 Nov. Nov. WHOLESALE PRICES, NEW SERIES i K < 1947-49 = 100): '44,700.000 105,700,000 - INSTITUTE (200) Personal $36,366,778 sales Total 106,700,000 $537,000,000 _Z Z Z—Z-ZZZ (15) Total 823,437 $77,508,344 .Nov. c Round-lot purchases by dealers— Number of shares Short 50.400,000 120,600,000 $49,453 ,_1_1 Other labor 27,829 Qound-lot sales by dealers— Other — 10,200;000 48,500,000 Government 851,266 12,550 -Nov. -Nov. shares—Total PURCHASES , 97,000.000 Proprietors and rental Income .Nov. -Nov. value of 55,300,000 9,700.000 108;300.000 ; Z_ Total personal income—--: 1,264,337 $70,838,537 sales. sales ' _IZZ __J. __f. ; Service Industries $76,733,823 other sales Short $222,l'OO.0OO 55,4OO.O0(> *9,600,000 50,900.000 -■ — and salary receipts, total Commodity producing industries Distributing industries —Nov. Odd-lot purchases by dealers (customers' sales)— Number of orders—Customers' total sales Number $246,800,000 LIFE Wage Nov. . value Dollar OF TO PERSONAL INCOME IN THE UNITED SfAl,ES (DEPARTMENT OF COMMERCE)—Month 2,118.345 purchases)—+ short 136.7 $222,600,000 PAYMENTS AND SALES COMMERCE) NEW SERIES August (millions of dollars): ' (not 956,420 Nov. Customers' 127.1 WEIGHTED AVERAGE YIELD OF 100 COMMON STOCKS—Month of October: 1,111,120 Nov. Customers' 125.1 121-# MOODY'S STOCK TRANSACTIONS FOR ODD-LOT ACCOUNT OF ODDLOT DEALERS AND SPECIALISTS ON N. Y. STOCK EXCHANGE — SECURITIES EXCHANGE COMMISSION: Odd-lot sales by dealers (customers' Dollar 139:0 113.3 services-——. Sales'.-—- Average sales shares and 145.0 128.9 116.7 MONEY IN CIRCULATION—TREASURY DEPT. As of Aug. 31 (000's omitted) members— sales of *181.1' ". 125.5' 128.7 Total Nov, sales Number 135.9 189.5 146.1 Nondurables Nov. Other 141.0 130.1 OF cf Industrials sales Short 92.3, 116.6 — (DEPT. Nov. transactions for account of 99.8 128.1 $5,086 Nov. purchases Total 3.037,450 1 floor— sales round-lot 141.3 109.3 " 130.4 : Nov. Other sales 91.9 Z_~ —„ Nov. Total purchases Total 1 Nov. initiated off the 98.5 92.0 , 130.0 __ _ :_I_ZI_IZ_ INSURANCE Nov! transactions 99.6 104.8 _ the floor- sales Short 108.3 130.1 ; Durables Nov . sales Other 107.3 136.8 '' Inventories— Nov. sales Other Total 128.3 106.6 :. dividends Month Nov. JS. on girls'— Total MEM¬ BERS, EXCEPT ODD-LOT DEALERS AND SPECIALISTS: Transactions of specialists In 6tocks in which registeredTotal purchases Nov. sales 132.1 108.3 ______ recreation—: Group 109.76 103.3 132.2 MANUFACTUkERS' INVENTORIES 100 ACCOUNT 133.6 103.6 . 433,323 OIL, PAINT AND DRUG REPORTER PRICE INDEX— OHier transactions initiated Total purchases— ^ care and goods Industrial 284.288 15 ov. Percentage of activity l Unfilled orders (tons) at end of period 135.2 i 18f9.8 Oranituy -Nov. 15 12(1.3 135.7 113.7 107.1 INSURANCE—Month (000,000's omitted): 386.7. 127.9 138.1 .117.5 ; OF.UFE V i —1:1 .; Total NATIONAL PAPERBOARD ASSOCIATION: Other sales Total sales oil- 4.68 lov. 25 115.0 113.3 127.9 —i—U.—• • INSURANCE—BENEFIT Policy 113. L 114:8 t 138.2 - Surrender values 4.29 4.49 . 4.57 i *ov. 25 MOODY'S COMMODITY INDEX-. Short fuel Disability payments Annuity payments 4.02 4.20 lov. 25 ii^.e 113.4 Matured endowments 3.27 rov. 25 ,110.3 113.0 _ POLICYHOLDERS •—INSTITUTE INSURANCE—Month of August: Ddath benefits •: DAILY AVERAGES: — 1953=100) 81.05 88.13 Other 117.7 115.2 —— Personal 92.93 90.06 131.2- 118 0 boys'— and 117:0 115.5 l92.p 124,.f _^_ care. 93.23 lov. 25 FOR and Private 95.01 — = 121.1 126:7 120.7^ ——_ apparel Medical Nov. 25 TRANSACTIONS 123.7 119.2 114.1 Public —• • Government Bonds AVERAGE 3,442 115.8 operation and Other —Nov. 25 . home (Jan., ,1 Transportation Average corporate 1949 .19,579 133.5 electricity, Women's 89.625c Railroad Group _J Utilities Group Industrials Group. (tons) (tons) 10,769. 123.7 Footwear Nov. 25 Orders received 449.279 118.7 — Men's 26.000c at Bonds YIELD ■s 24 Z^—ZZ—_?? home__J__________ Apparel J0.000C 24.700c Public ROUND-LOT 212,139 2,128 ■ _Z_ fuels _l5v. Production 214.119 27,336 — ___ and Household 10.500c Nov. 19 foods at lov. 25 Railroad 99,631 37,441 'ld0— • Gas Nov. 25 U. 8. 138,626 123,604 and away from -Aw. 25 BOND 164,117 t "if. • '• Housefurnlshings 13.300c -Nov. 19 at (primary pig. 99% ) at corporate. MOODY'S <-l£ I'M — at Solid 13.500c MOODY'S BOND PRICES DAILY AVERAGES: Average tons tons')—-Z— INDEX , Rent 23.150c 13.000c at___ U. 8- Government $91,300 "'•920 Housing 26.425c Nov. 19 -Nov. 19 : (New York) (net . (net . Food 4 at (East St. Louis) America of September: Other 5.967c •lov. 18 -4ov. 18 . refinery tin $85,900 12:800 MINES)— bakery products Meats,- poultry and fish_——i_r— Dairy products : Fruits and vegetables 308 , (E. & M. J. QUOTATIONS): Export refinery at York) at Lead (St. Louis) at— America Cereals Electrolytic copper- Straits ;:24,300 tons)_'_12_—' PRICE Foocl Nov. 18 ; (per gross ton) Aluminum OF tons>4 items ,, NOV. 20 (per lb.) Lead (New (net CONSUMER DUN & — Pig iron (per gross ton) tZinc (delivered) S54,2b0 12,100 .? 24,000 Undesignated 9,147.000 V Central (net South COMPOSITE PRICES: Domestic $49,800 12,100 120.3 Nov. 22 (COMMERCIAL AND BRADSTREET, INC. Zinc Asia INSTITUTE: Electric output (in 000 kwh.) ' (BUREAU and To Pennsylvania anthracite (tons) Scrap steel : $85,400 123,396,000 8,465,000 METAL PRICES $49,500 EXPORTS 119,612.000 *8,600,000 steel August Month of August: y U. S. exports of Pennsylvania anthracite (net tons) —„_i___y $243,008,000 8,585,000 Finished of 569,575 COAL Nov. 15 IRON AGE 79,333 155,925- 23,900 Nov. 20 COAL OUTPUT (U. S. BUREAU OF MINES): Bituminous coal and lignite (tons) FAILURES 81.492 77,118 238,116 COM¬ . Nov. 20 — municipal EDISON ELECTRIC 63,705 93,244 210,176 dollars): Wholesale —Nov. 20 construction. and of 65,304 SERIES —Month 5.326,369 . construction State (tons OF " 4,950,04? 647,297 ENGINEERING construction S. output all grades • •• _: NEW 14,506,000 U. Private Public ' - - * NEWS-RECORD: Total ' INVENTORIES—DEPT. (Millions 59,867,000 695,768 4.962,407 of Manufacturing ... Ago 362 (tons of 2,000 pounds)_—_!_ end of period (tons)i._y^^_t'_i_-ry MERCE 182,478,000 32,220,000 164,330,000 at .Nov. 15 freight loaded (number of cars). freight received from connections (no. of cars)—Nov. 15 ENGINEERING smelter pounds) KUSINESS " Revenue zinc 2,000 Shipments by INSTITUTE, INC.—Month ; Year Month • freight transported tohs)_—— (in of that data?' Previous INC. " general 7,618,000 ASSOCIATION OF AMERICAN RAILROADS: CIVIL Slab ASSOCIATION, August: . 2,026,000 Stocks at refineries. bulk terminals, in transit, in pipe linesFinished and unfinished gasoline (bbls.) at Nov. 14 Kerosene (bbls.) at Nov. 14 Revenue of October: 26,853,000 2,393.000 .Nov, 14 : 28.095,000 Nov. 14 Gasoline output (bbls.) Kerosene output (bbls.) Distillate fuel oil output (bbls.) Residual fuel oil output (bbls.)— Distillate fuel oil (bbls.) Residual fuel oil (bbls.) TRUCKING AMERICAN ZINC Nov. 14 —Nov. 14 gallons each) 42 are as Month 72.1 carriers output—daily average of quotations, cases either for the are Latest Month Nov. 30 in or, - AMERICAN PETROLEUM INSTITUTE: Crude Dates shown in first column that date, on Year ........ (net tons) Thursday, November 27, 1958 GROSS of Oct." "31—: General lands Net 'fleb't bklancd—ZLiZZ: l_. Computed annual rate " $280,323,400 _ "4,534,264 $276,"^745 ^27*.170,055 5,4)38,837 " %m,o37 V $275,783,136 8271,884,308 2.647% 2.577% 1^,863,468 2.891% 188- Number 5798 Volume . The Commercial and Financial Chronicle .. (2231) 39 covery, however, it's still too soon tell how well the public will Energy, 16.7%; Copper and Nickel, 4.7%; Uranium, 1.8%; Coal and 7 ilO/ Qliorct V„lnA accept the 1959 models. Mining Equipment, 125%; Spe * ™/0 Ml ullflrC \ H1116 "The prevailing confidence that cialty Metals, 6.3%. ^ f Missiles-Jets Up to ill hgs ?}? the inflationary- The Missiles-Jets & Automation Fund, Incr reports that net asset value per share rose 7.4% to $9.83 By ROBERTS. RICH - ' J? public have forced com- * Largest Energy Fun# at Sept. 30, 195$ #dr Dutch Petroleum, Tampa Electric a"d TV-Electronics Yy>. F # ■ l * Jr 1111(1 Assets now to. 16,059,119. q/wiA/ 1^^(111%; mutual iuna, wmcn is dis estimated 1958 earnings At> the close of its 10th year, tribute^ by the New York invest . ' 18: times over Fund Regorti 9r3*b'5S the — $157.50*' $4,806,7651 $2.45 $&55' 30,51# Fund, Televfsion-EIectronics to cash and equivalent. was Inc., pioneer mutual fund concen- portfolio position, in the missiles, jet and automation This trattag; investments m t^broad- stated; field of electronics, decade of: eJCistence The: fund, recently added comshares of Olin Mathieson reflected , a substantial of emphasis from a year ago closed^ first withe «rtal net±."wheh.cautibn was the folio, eral ; T : . Largest j the New tion Securities mutual funds Series of v."^1"past six months." These included during the period ended. Oct. 31 nevv v- additions of the commion according to the Semi-Annual - int Chicago;stocks of Champion Spark of Co. porter and Ling Electronics, Reflecting new oOrppiat.inn rpnnrf Double open-end . . , Offering;jmcewas$9il1 (the;stock ^ ass? ? T?ue ^ at v that time, .,..m ^ ed ; ; : 'ended : a report'shows; thd :-'H)i6ina thA dn net on Oct..311 or.a ex^nenced.. far, . -A" •" - 55.1 cents ' u*:it to our in the YOUR INVESTMENT KAUTON next the next supply energy S? & of is NATMHML SECURITIES & ^p?ovfde RESEARCH CORPOMTION ex- 60% EthbHtM mo our energy. 120 -°{! th-e. horizori period covered m ^ and- ihe end^ the By 2050, it is expected, increased a apprecia- man The Energy Fund reoort for energv-hungrv * - become kthe;.year,,.from!. 65,312<to 78,743,pany. , . 0n percent 1958 1958 increase Growth Stocks. $5.43 $6.70 23.4',£> Dividend 3.26 - Income— stock Preferred connected 3.94 20.9 6.69' 8.03 20.0 5.17 Stock economy energy bright Series- (speciait® the financial chronicle) -APPLETON, Wis.—Granville O. has ern shown below: APril 3°, °et. 3!, 5.88 13.7 7.35 7.89 7.3 5.45 5.81 10.12 10.58 6.6 4.5 Bond Balanced sum- J&vSfiJ.Sw«S?rf ta^e slx Tnth report are diminishes its poten- ^ *" Marihan eom- of the world areas . energy on Iltt6r«st( mod- and the lit *%£££,!& combine to indicate futoeffor thl la?ge S specialized group Of sales growth whose growth- are solidly requirements of our companies, and profit built on the"high energy WBWiU be gladsend you civilization." Mr. shareholders, Ralph E. Samuel; President, fund lia$ Fnor<rV _ . * *y it c%4 a*/ Rowe T. Get the facts Price Growth Stock Fund, Inc. reported that total assets increased to $14,121,737 on Sept. 30, 1958, from $9,436,114 on Dec. 31, 1957. During the first nine months of 1958, net asset value per: share increased 24.2% from $27.67 to $34.38. During this period 893 new stockholders sub- on , scribed to. Fund shares. In now icajnindustsy. Price noted which has taken place since April of 1958. "Since then industrial production about this series of Mutual Funds seeking as through, investment in Amer- - .. his report, Mr. business; recovery the measured serve by the Federal Re- Board Index has recovered roorethan75HoUfingBof stocks selected from athdri^Me T. Howe-Priced Net , af-free prospedoydescriMt^Abnk^ ^ In his message to Fund th»t th* amwfh in Energy Fund that the growth in Asset V alue LI p24.2% the use of energy will continue at a ' a Findvbut > Broadway, Now York 5; Ni Y. employment, of energy will enable to produce as much in one ^ the funds> ties Series funds at the beginning opportunity, real-?.:witlii • McKee & Jaeckels; Inc., number ^Irving1 Zuelke Building. He was posribkc growth and mcorne MNtSFBTU* TO FOLDER AND auadrunle Coaf which currently provides 50% of can add substantially to their In addition, unrealized M-A, distributed in/Benson gains.;- The WRITE FOR FREE INFORMATION Sroqp production capability of the elec- accumulation ^of shares and thus, theifirst'fiscal- 4uerter from: -izedi capital. RIND S 61,41® iofllT7%* More In'thelalt Wiin i¥lc Ivee a JaecKew, This reflected of 28.4%, when adjusted1; the n & $52^0,2*63, value . unlimited yi today.that current fiscal year. gain ^hare^ already tion Increased by Electronics,; { Per share net asset Growth;1 was also; marked; tiM/:in:;'the foreseeable future." asset value per share, which„ • * - INVISTMINT In the .next ten years, demand in the next U for oil is expected- to increase ~^r oil is' expected to incres ice short,-has opened a vista of, each of the seven National Securi- pius the dependence of the thus ;19OT, to- $12.75- at the close of the' for , e peen Pf gain A MUTUAL company ^tside; ther military sector; investments y totaled $7,447,323 seven-hour day as today's worker £romes Production is en- aften provision for tax reserves. can during a 40-hour week! £ •increased from $10.36 on Oct 31; a th' iotd additional shares and the reyears, tenng a new and: more dramatic vwvjdf* Fundus- resources grew from sm r $135.1/ ported Qo income^' their s^rce o£ future In the past nscal year, the mu- :5>1^3%; - Stettnc^oatot "m^alizerkgain S^^n^ di^Wdnt^ from ihv^t- #"""v SS* an * Energy Fund, investment tripled by 1975. w. port comments, ^Over the Ftihd .shareholders' from realized capital . - the growth- in, electronics and nu- the bers of the New York ah<$ Bostwi Stock Exchanges. to wlU be drawing, from all sources, Research his ; than 54,009 Natidjaai shareowners pected ^^Wy^are reinvesting all distributions twenty 'Stod proS- v ; wlU.uhquesUonably aooelcrate this '-Further BOSTON, Mass. Bymaro £r. Kaplan is now with^ Draped,- SMtiiis & Co., 56 Congress Shr^et; miaH Oct on period 1 979 irSntSl ^5 of the Space Age ; compantes Sml •• $ (Special to The Financial Chronicle) ^ ^ $W'Q00^° fiVf,™, -ieo oak. Avi.. Anrti Cd.^^n^^dlt tfh & date lrlXes^m^nt. company recol^Pany re- in, Ajftpqx Corp.. General ^ Securities that investment and lichtenedcommon stock ownivuiimiuii stock ai# iightene^^common siucA'uw.li-. own- Ve« yeari later on Oct 31 1958 Tripp -pointe the Fund's" $387678605 to Shice mirk, unrealized industries^Ine., Ryan Aeronauticommon stock bai X^o; arid ibrague Electric Co ah profit in it& 18 Mvestments of. only $1,687. dollar Corporation has announced that ibore tban double the energy it assets have crossed the $400 000 rtftft now uses and world energy con' sumption will have more than i^ss;:; Jt: 'elimii^ed Littoii .the. Fuhd ^ Nationai Magnar and4* Etadio Corp. of America. its equity holdings 195$ April 3(1 0n ^eh'eral,.^ oao J^ere. were, Je^s Than ^0. 2 shareholders „ Manufacturing Co., General ElecMotors Corp., .SpM «2*£or-l ,was _ other specializing in investments in the energy industries and companies, estimates that by 1970, the U. S. _ * by 1970 shareholders-, ehnum the staff of 4H£33»5EmS* sales and market fhn . added to Dawson& Co;, J! Norm a substantial por¬ portfolio in higher the Needs Tv/r^ ^°* and Perkin-Elmer Corp. and curities & Research Corporation, .t mty m may, convertible bonds of Fischer & sponsor and manager of the funds. CHICAGO; m.^ireh&iL Stopa Consequently, ^ Report released by National Se- Plug ^^lcSi Jv1- ?? m 1948, and began investment oper- 2L,_ Expects Domestic to record levels rose (SperialtfrTHB-FCTAWciAR C^owfctiiy onti- an has- been hence. yielding bonds and assets, shareowners obligations." outstanding of the shares National years discounting of keeping icy High Levels Combined and be consider it prudent to continue we ' "i to _open-end^ inwstment ^ ^lu ^• . . ti NationalsFunds at pace- <Mmiciled company i4 XT its ;during^the third quarter of the qnd kto -^.egr, ,hg spid,; "represented largely a size," Mr, Tripp said, ^which no. a continuation of the more agother comparable investment, me- „$l£ssiye policy which has dictated ;/fhVestrtteht Operations during the diuitt has matched." ^f : :; .rlhVestTh^t derations during the a John A. Dawsoii Add* misfit nrnwtw grown, i; in has favorite manv thedrcumstanws,prices Chemical Corporation to its nort- iVatchword number., ofshareholders^ ahtt -management was trimming for• the ^anticipated recesjtevels; ChesterD. Tripp, - Presi-v sionywhich materialized, and for denty. told:,., shareholders - m : the which-your Fund was prepared." Fund's annual. report. Major portfolio"changes effected Fund "Under seem and? shares, outstanding, at? recordrisails "The Drices of mon assets, initial: decade,, at has forced Srto excSehSts Mr. Tripp fields, faster pace than the expansion of the economy as a whole. And this abnormal growth, together growth in principal and income^ s , should as . # . improvement, bring about better prices 1633 THIRTIETH STMET, N. W. WASHINGTON /, D. C. time goes on for equities gen- erally and for "energy equities" in particular. And to these factors, of course, should be added the thought I mentioned earliernamely, that widespread belief in the inevitability of nominal yearto-year inflation is going to mean that a larger and. larger share of the investor's capital will, find its way into common stocks. All of these factors lead us to the firm from! 126' toG37, or more than half conclusion that regardless of, the of- the decline - which had taken market's temporary vagaries, inplace from the previous high, of vestment in carefully, selected 147. The sharp recovery to date, companies Jn the energy Held he said, has resulted from strong should prove satisfactorily- reconsumer demandv cessation of inwarding as time goes oil. ventory liquidation, increase in At Sept. 30, 1958, Energy Fund manufacturers' new orders, higher investments in- the energy, field government spending and aspe- were diversified as follows: Oil cially. a sharp-increase in home and Gas, 29.8%; Utilities-Electric, building and public construcuon. 13.6%; Utilities-Gas, 2.3%; Nu— The outlook-for the fourth quarter clear and Conventional General-' appears, .bright. With regard to in® Apparatus, 7.4%; Nuclear Rethe automobile industry which actor Design and Constrimbh; 1 . t L FAMWUN CUSTOD1AK FUNDS, INC. ■ ft* WMIStevvt.W«w Please sen4 me, YvrtB,Y. • without obligation, the Prospectus and other infor¬ mation concerning the Franklin Custodian Funds. I I wool I t mmurn. *«S9^-r rrnkrwr- - afrierW I - ' has been the chief drag, on re-. 3,4%; Control and- Utilization of __ Atomic Development Securities CoiJnc.Rtpl C with the economy's eoflMeBtive qsartefly ilvidni Itc orshor* from nei' Iwotiiitflili# "1wWM| O w»vf • G1WTF* am—i.JjfA' MUHMW nwfN' VOONIfl 9flfn9|fv' |mI8l pvyoMt Dtcciibcf - Mectf of Kcwi 29® lo Bwibirt'lNi. WALta ft, MOMAMk» nVSWMNr I 40 The Commercial and Financial Chronicle.. (2232) . Thursday, November 27, 1958? * INDICATES Securities Now in Admiral Benbow Inn, Inc., Memphis, Tenn. (letter of notification) 100,000 gherCS'of common stock (no par). Price-—$2.50 p€f share. Proceeds—For operating a restaurant. Underwriter—James N. Reddock & Co., Memphis, Tenn. Nov. 5 Registration • mencement to be approximately $11 per share). Proceeds—Together with other funds, will be used tor development of the company's properties and for working capital. Under¬ writers—Carl M. Loeb, Rhoades & Co. and Dominick & Dominick, both of New York. ADDITIONS SINCE PREVIOUS . of ITEMS ISSUE REVISED •] ^ development ,of "Henderson ore body. St., Toronto, Ontario, Canada. Under* Office—55 Yonge writers—Allen & Co., New York, and W. C. Pitfield & Co., Ltd., Montreal, Quebec, Canada. • / : : Cardinal Nov. 12 filed 705,000 shares of common stock (par Nov. 24 filed 300,000 ic Associated Bowling. Centers, Inc. shares of 20-cent cumulative con¬ Instrumentation* Corp. (12/9) / Nov. 4 letter of notification) 240,000 shares of common stock. Price—At par ($1 per share). Proceeds—For pay-* of vertible ment of Ambassador Oil (12/4) $1), Corp., Fort Worth, Tex. which 5,000 shares are to be offered for sale to com¬ employees. Price-—To be supplied by amendment. Proceeds—For general corporate purposes. Underwriter —Dempsey-Tegeler & Co., St. Louis, Mo. pany American Art Metals Co. Nov. due 10 filed 1968. (12/9) $1,250,000 of 6% Price—To be convertible debentures Pro- supplied by amendment. eeeds—$156,500 to retire outstanding notes; $145,500 to retire the presently outstanding 6% cumulative pre¬ ferred stock: for construction of plant, and acquisi¬ equipment and relocation of facilities; and for working capital. Business—A manufacturer of alumInum entrance? and store fronts from aluminum ex¬ trusions. Office—-433 Highland Ave., N. E., Atlanta, Ga. Underwriters—The Johnson, Lane, Space Corp., Atlanta end Savannah, Ga.; W. E. Hutton & Co., New York; and J. H. Hilsman & Co., Inc., Atlanta, Ga. % tion of ^ American Asiatic Oil Corp. 4201 Redwood , Carolina Tolophono & Telegraph Co. (12/5) // Nov. 17 filed 58,773 shares of common capital stock (par $100) to be offered for subscription to stockholders of record Dec. 4, 1958, in the ratio of one new share for each five shares then held; rights to expire on Dec. 29. Price—$125 per share. Proceeds—To reduce short-term bank loans. i • Austria Carolina Telephone & Telegraph Co. (12/10) ' Nov. 17 filed 65,952 rights to subscribe for common stock (12/3) External Sinking Fund Dollar Bonds due Dec. 1, 1973. Price—To be supplied by amend¬ ment. Proceeds—To be added to the Republic's foreign exchange reserves and be used for the continuation of certain capital expenditure programs. Underwriters— Kuhn, Loeb & Co., and Ladenburg, Thalmann & Co., (Republic of) Nov. 13 filed $25,000,000 of (par $100) (letter of notification) 50,000 shares of noncumulative convertible preferred stock (par $3) and common stock (par one cent) to be offered in units of 10 shares of preferred stock and one working capital. Office-—401 E. Green Street, Pasa¬ dena, Calif. Underwriter—None. shares 5,000 of —For ital. Price—$31 per unit. stock. chare of common writer — York Securities, Inc., 80 Wall St., New York, N. Y. / 4,545/455 shares of this stock are to be offered for public sale at $1.75 per share. [Shares have been issued or are issuable under agreements with various policy holders in American Buyers Life Insurance Co. and American Life Assurance Co. (both of Phoenix) permitting them to purchase stock at $1.25 per share. Sales personnel have been given the right to purchase stock at $1.25 per share up to the amount of commission they receive on stock sales made by them.] Proceeds—For the opera¬ tion of other branch offices, both in Arizona and in other states. Office—2001 East Roosevelt, Phoenix, Ariz. Un¬ derwriter—None. stock (par 200). Proceeds — To discharge current liabilities and to drill ten wells. Un¬ Feb. 28 filed 500,000 shares of common price—To be supplied by amendment. derwriters*—To be named by amendment. Fund, Inc., New York Oct. 30 filed 487,897 shares of common stock. Price—At market. Proceeds—For investment. Distributor—Ed¬ American Enterprise ward A. Viner & Co., Inc., New York. inc., Denver, Cole. capital stock (par one cent). Price—At market. Proceeds—For investment. Office—800 Security Building, Denver, Colo. Under-,, American Growth Fund, Nov. 17 filed 1,000,000 shares of writer—American Growth Fund Sponsors, Inc., 800 Se¬ curity Bldg., Denver 2, Colo.; American Mutual Investment Co., Dec. 17 filed 490,000 shares of capital per /develop ^hopping centers and build or.purchase office Jbuildings. Office — 900 Woodward Bldg., Washington, D. C. Underwriter — None. Sheldon Magazine, 1201 Highland Drive. Silver Spring. Md... is President. American Telemail Service, (12/10) - Estate of Alice Busch. Underwriters—Newhard, Cook ■& Cof; Reinholdt & Gardner; Stifel, Nicolaus & Co., Inc.; Scherck, Richter Co.; all of St. Louis, Mo. and Anita Cobre U. S. A., Inc., Phoenix, Ariz. 1 filed 85,000 shares of common stock. ($3.75 per share). Proceeds—For invest-" ment in subsidiary and working capital; Underwriter— Selected Securities, Inc., Phoenix, Ariz. 30, 1957, Price—At par . ^Aqua-Shine Corp. (dba American Silicone Co.). Itov»; 12 (letter of-notification) 12,000 shares of common stock to b^ offered,for subscription to: a selected clien-. tele.: :Price—At par ($1 per share).'Prpceedsr—For work¬ ing capital-. ,Offi«e-T~374Q South Jason St., Englewood,, Colo. Underwriter—None. • f;Miautti^ Fla. (12/3*4):. Oct. 28 Med' 2^00,000 shares Of class A common stock(par $1). Price—To be supplied by amendment (expected - . to 11 a.m. 1849, 3720 E, A, Huby Co.4 ; - Oct. 23. options. Price—To public, $6 per share. Proceeds—For expansion and other corporate purposes. Office —At¬ Checker Motors Corp.* Kalamazoo, Mich. Nov. 7 filed 133,112 shares of common stock (par $1.25) to be offered for subscription by holders of outstanding Underwriter—None. Bankers Management Corp. Feb. 10 filed 400,000 shares of common common stock of record Nov.- 26, 1958 at share for each shares then stock (par 25 cents.) Price—$1 per share. Proceeds—To reduce out¬ standing indebtedness and for working capital. OfficeHouston, Texas. Underwriter—McDonald, Kaiser & Co., Inc. (formerly McDonald, Holman & Co., Inc.), New York. for the rate of one held Price—To be supplied by amendment. new (with an oversubscription privilege); rights to expire on Dec. 18. seven Proceeds — For exercise by company of its option to purchase 19 presses and accessories leased from Checker Taxi Co. Inc. and working capital. Checker taxicabs. Business — Manufactures and sells Underwriter—None. April 14 filed 8,934 shares of common stock. Price—At par ($100 per share). Proceeds—For general corporate purposes Underwriter — Bankers Bond. Co., Louis¬ Nov. 24 filed 210,000 shares of class "A" voting common stock and 210,000 warrants to subscribe to a like number ville. Ky of shares of class, "B" 4r Chemical Fire & Casualty Insurance Co. Bellechasse chasers of the class Mining Corp. Ltd. Oct. 29 filed 800,000 shares of common stock. PriceRelated to the market price on the Canadian Stock Ex¬ change, at the time the offering is made. Proceeds—To be applied over the balance of 1958 and the next three years as follows: for annual assessment work On the com¬ pany's properties (other than mining claims in the Mt. Wright area in Quebec); for general prospecting costs; real, Canada. Underwriters—Nicholas Belock Instrument Corp. purchased a warrant granting the right to purchase $10 per share one shares of class "B" stock for a period of 18 months after the company receives permis¬ sion to write insurance. Price—$10 per share. Proceeds —For working capital. Office—2807 Sterick Bldg., Mem¬ for phis, Tenn. For working capital. Office — 937 Acequia Madre RcL, Santa Fe, N. M. Underwriter—Watson & Co., Santa Fe, (12/15-18) N, M, ' Clute Nov. 10 . Saco Water Co. common • Price—At par ($100, per share). Proceeds — For improvements and additions to property. Office—181 Biddeford, Me. Underwriter—None. ■ Coleman Engineering Co., Inc. (11/28) - warrant to purchase 30 common shares will be attached to each $500 principal amount of debentures, or a total of 60,000 shares. Price —100%. and accrued interest. Bowl America Corp., Arlington, Va. (12/1-2) Nov. 10 filed 300,000 shares of common'stock (par 10 cents). Price—$2 per share. Proceeds—For acquisition ot land, building improvements and working capital. Un¬ derwriter—Auchincloss, Parker & Redpath, Washington, Proceeds—To retire short-term borrowings; for antici¬ pated increases in inventory; and for additions to work¬ ing capital for genera! corporate purposes. Underwriters —Wilson, Johnson & Higgins, San Francisco, Calif; and Lester, Ryons & .Co., Los Angeles, Calif. Offering—Ex¬ , , ; common Oct. 27 filed $1,000,000 of 6% sinking fund debentures due 1973 (with stock purchase warrants attached). A • D. C. ;■' ... Price—$1 per share. Proceeds—To pay additional costs of construction; and for retirement of obligations and working capital. Office — c/o John Harlan Lowell, 2200 Kenton, Aurora, Golo. Underwriter —Lowell Murphy & Co., Inc., Denver, Colo. stock. Elm St., • , stock (par one cent). Underwriter—Carl M. Loeb, (letter of notiifcation) 1,000 shares of ' Corp. Aug. 21 (letter of notification) 300,000 shares of For inventory and Operating equipment for manufacture of new products recently developed, and the & Productions, Jnc. June. 30 (letter of notification^ 300,000 shares of common stock (par 10 cents). Price—$1 per share. Proceeds— — balance for working capital. Rhoades & Co., New York. Underwriter—None. Cinemark II Office—Mont¬ Modihos & Co. Nov/12 filed $1,000,000 of convertible subordinate deben¬ tures due 1973. Price—To, be supplied by amendment. Proceeds non-voting common stock* Pur¬ "A" shares will receive with each share and for. general administration expenses. Biddeford Nov. 14 filed 100,000 shares of common stock (par $4). Price—To be supplied by amendment. Proceeds—To the Sept. Fidelity Life Insurance Co. $1), and 133,740 shares to employees pursuant to stock purchase Inc.. Feb. 17 filed 375,000 'shares of common stock (par f i Price—$4 per share. Proceeds—To purchase equipmen and supplies and for working capital and other corporate purposes Office—Salt Lake City Utah Underwrite* AmosTreat & Co., Inc., of New York. Change in Name —Formerly United States Telemail Service, Inc. Anheuser-Busch, Inc. stock (par $2.50). Feb. 28 filed 258,740 shares of common stock (par of which 125,000 shares are to be offered publicly stock. Price—$10.20 share. Proceeds—For investment in first trust notes, second trust notes and constructipn loans. Company may up v Inc. Sept. 9 filed 4,000,000 shares of common stock (par 10 cents), represented by voting trust certificates, of which 3,530,000 shares are to be offered to the public and the remaining 470,000 shares have been issued to nine per¬ sons, who may sell such shares at the market Price—60 cents per share. Proceeds — For construction of racing plant and acquisition of equipment Office—Charlestown, W. Va. Underwriter—None. Statement effective ((Washington, D. C.) in the United States and by Forget ik Forget in Canada. Inc. ^ Charlee Town Racing Association, Bankers Southern, Inc. (N. Y.) American-Caribbean Oil Co. to be received Dec. 10. Denver, Cold. Price—$5 per share. Proceeds—To increase capital and surplus. Office—Atlanta, Ga. Underwriter—None. lanta. Ga Bids— Expected on For working capital. Address—P. O. Box 32nd St., Yuma, Ariz. Underwriter — L. Autosurance Co. of America Bankers share to ir Centex of Arizona, Inc. for Oct. 16 filed 250,000 shares of common per Nov. 17 (letter of notification) 300,000 shares of common stock (par 25 cents), Price—$1 per share. Proceeds— convertible . Americah Buyers Credit Co. Nov. 13 filed 5,000,000 shares of common stock, of which ' Automation Instruments, Inc. Oct. 7 (letter of notification) $250,000 Proceeds purchase of bowling equipment and working cap¬ Office—135 Front St., New York, N, Y. Under¬ one-for-five basis at $125 of 22.6% & Co. of 6% 15-year sinking fund debentures to be offered for subscription by stockholders of record Oct. 1, 1958. Un¬ subscribed shares to public. Price—90% of face amount (in denominations of $100, $500 and $1,000 each). Pro¬ ceeds—To retire notes payable to bank and others and 10 a Telephone & Telegraph Co., of the outstanding Carolina stock. Un¬ derwriter—To be determined by competitive bidding. Probable bidders: R. S. Dickson & Co., Kidder, Peabody owner (EST) Office—Magsaysay Building, San Luis, Ermita, Manila, Republic of Philippines. Underwriter — Gaberman & Hagedorn, Inc., Manila, Republic of Philippines. American Bowling Equipment Corp. on be issued to Southern Bell both of New York. Nov. Underwriter—None. amendment. Nov. 24 filed 100,000,000 shares of capital stock. Price— TTwo cents per share. Proceeds—To selling stockholders. , notes, capital additions and inventory. Office— Ave., Los Angeles 66, Calif. Underwriter —Myron A. Lomasney & Co., New York. 1 preferred stock (par one cent) and 50,000 out¬ standing shares of common stock (par one cent). The preferred shares are to be offered for public sale for the account of the company and the common shares will be offered for the account of a selling stockholder. Price —To be supplied by amendment. Proceeds—To acquire new bowling centers and increase working capital (part to be used in defraying cost of acquisition of stock of owner of a Brooklyn (N. Y.) bowling center. Office— 135 Front St., N. Y. Underwriter — To be named by Bridgehampton Road Races Corp. (letter of notification) 15,000 shares of common stock (par $1) to be offered for subscription by stock¬ Oct. 23 pected this week. "* Colonial Aircraft Corp., Saitford,Me.'J ' - holders of record Nov. 1, 1958 on the basis of one new share for each four shares held; unsubscribed shares Oct. 8 filed 346,492 shares of common stock (par 10 cents)/ Price—75 cents per share. Proceeds—To reduce will be loans, make certain capital improvements and for work¬ ing capital. Underwriter—Mallory Securities, Inc.. New or offered to current creditors in payment of all part of claims, at the rate of . one share for each $4 of claims discharged; rights to expire about two weeks mailing of offer. Price—$4 per share. Proceeds— pay current creditors. Address '— P.< O. Box-506, Bridgehampton, L. I., N. Y. Underwriter—None. York. after . • Campbell CHbougamau Mines, Ltd. (12/3-4) Nov. 12 filed.$5,000,000 of 6%,first mortgage convertible sinking fund bonds. Price—To be supplied by amend-merit. Proceeds1—To repay bank-loans,-and the remainder will be used for corporate purposes, including com- \ . : • Colonial Sand & Stone Co., Inc., New York To - r ; . < Nov.26 filed 97t226Jshares.of. common-stock and a like amount of warrants, latter to be exchanged by underwriters for 63*467-shares- of eommon;-Warrants are exercisable at an adjust price of $6,912 per ahare of common stock." Price—To be supplied by amendment." Proceeds— To be added to the "gerieraTfuiids of the cdmpany/'Uhderwriter—Glore, Forgan & Co., New York. Volume 188 Number 5798 . . The Commercial and Financial Chronicle . ^ Columbia Gas System, Inc. (12/15-24) prior to maturity and of 5&% preferred stock; the possible improvement and expansion of present facili¬ ties; and the acquisition of manufacturing plants and crude oil properties if favorable opportunities therefore arise. Underwriter—None. ness Nov. 21 filed 800,000 shares of common stock: (par $10). Price—To be supplied by amendment. Proceeds—To selling stockholders. Underwriters Carl M. Loeb, Rhoades & Co., Merrill Lynch, Pierce, Fenner & Smith and seven other firms, all of New York. ( -— , Consumers Power Co. ■ CemmerceOII Refining Corp. Dec. 16,1957 filed -$25,009,000 of first mortgage bonds due Sept. 1, 1968, $20,000,00 of subordinated debentures due Oct 1, 1968 and 3,000,900 shares common stock to be offered hi unifcsas folktvvs: $l,00u of bonds'and 48 share* eC stock. mad. $100 of debentures ***"4 nine shares of stock Wee-To be supplied by amendment. Proceeds — Tc refinery. Underwriter—Lehman Brothers, New Offering—Indefinite. t • Price—To be supplied by amendment. Proceeds-—To re* short-term bank loans and for expansion and im* pay {movement of service facilities. Underwriter — Morgan Stanley & Con New York. Offering—Postponed indef¬ initely. ; c< 7' :ir Counselors Consumers Cooperative Association, Kansas City, > Mo. preferred stock'"(cumulative to extent earned before patronage refunds). Price—For certificates at $100 per unit; and the preferred stock at $25 per share. Proceeds —For retirement of Feb. Research Fund, Inc., Si Louls^ lWo. filed 5 100,000 shares of capital- stock, :(par one Price—At market. /Proceeds—For investment Underwriter -—Counselors Research Sales Corp., St: Louis. Robert H. Green is President. cent). > ' ; Oct 29 filed $6,000^000 of-5%% 25-year subordinated certificates of indebtedness, and 60,000 shares of 5^% v ;. Aug. 29 filed 150,OQO shares of preferred stock (no par),. construct York. (2233) maturing certificates of indebted¬ ness, redemptions on request of certificates of indebted¬ • Creuse-Hinds Co. (12/2) " Nov. 7 filed 219,408 shares of be stock. common Price—To supplied by amendment. Proceeds—To selling stock¬ Business—Producer of electrical conduit fit¬ holders. tings. Office—Wolf and Seventh Sts., Syracuse, Underwriter—Hornblower & Weeks, New York. N. Y. NEW ISSUE CALENDAR November Coleman (Friday) (Equitable _. Wilier Color Television System, Inc Jefferson) December 1 (Offering (Offering (Offering . to stockholders—not H. Abraham & Co., Inc.) (Bids (Bids Nielsen (Smith, (Bids to 8:30 PST) a.m. (Eastman Dillon, Southern $65,000,000 Securities (Stone ■& Webster Securities 250,000 Co.) Corp. and Paine, $2,500,000 1 (Hemphill, Co.) 360,000 ; '(Blair & Co., December 3 212,153 (Carl Fenner Rhoades Loeb, & Co. Texas Power (Kuhn, , Bonds Loeb & Co. and Curtis & Co.) Utilities (Bids Potomac 11 (Bids 11:30 a.m. 1 Lynch, Pierce, Bonds E3T) Boston Smith; & 1 - & Co.) December 4 Merrill Fenner Miles Laboratories, First 700,000 Common underwritten) Corp.) $7,346,625 Lane, Space (Milton D. G. Blauner Kletz & <fe shares Common Co., Co.) Inc. and Michael 60,000 shares Power Co (Bids to be invited) (Bids Bonds $20,000,000 Bonds $8,000,000 Southwestern Bell Telephone Co. Debentures (Bids to be Invited) $110,000,000 Utah Power & Light Co (Bids to be invited) Bonds $20,000,000 shares of class A Chi¬ New ; ' * ■; (12/9) common stock Price—To be ; V , . stock. common * Price—$1 share. Proceeds—For new equipment, repayment el loan, acquisition of properties under option, and other corporate purposes. Office—Toronto, Canada, and Em¬ porium, Pa. Underwriter—None. Desilu Productions, Inc. (12/2) Nov. 10 filed 525,000 shares of common stock, of which 250,000 shares are to be offered for the account of the company and 275,000 shares for selling stockholders. Price—To be supplied by amendment. Proceeds—or pur¬ chase of studios, series. wood, Calif. etc. Business—A Office—780 producer of filmed North Gower St., Holly¬ Underwriter—Bache & Co., New York. ★ Diversified Growth Stock Fund, Inc., Elizabeth, N. J. Nov. 25 shares filed of (by amendment) an additional 184,000 capital stock. Price—At market. Proceeds— For investment. / ★ Diversified Investment Fund, Inc., Elizabeth, N.J. Nov. 25 filed (by amendment) an additional 2,000,000 common stock. Price—At market. Proceeds— For investment. ' Co., Ltd. Nov. 3 (letter of notification) 222,220 shares ef common stock (par 10 cents). Price—$1.35 per share. Proceeds— For retirement of notes, purchase of equipment, raw materials, containers, etc., and leasehold improvements. Office 129 S. State St., Dover, Del. Underwriter—Ross Securities, Inc., New York. Dynamic Electronics-New York, Inc. (letter of notification) 99,000 shares of common stock (par 50 cents)." Price—$3 per share. Proceeds— For equipping and piitting in operation the new plant and for general corporate purposes. Office — 73-39 Woodhaven Blvd., Glendale, L. I., N. Y. Underwriter—, Elliott & Co., New York, N.- Y. Oct. 31 Nov. 5 (letter of notification) 7,500 shares of common (no par). Price—$24 per share. Proceeds—To sell¬ ing stockholders. Office—588 Commonwealth Ave., Bos¬ ton, Mass. No Underwriter—W. C. Langley & Co., Boston, public offer planned. ^ Epsco, Inc. 5 (letter of notification) 2,200 shares of common stock (no par). Price—At the market. Proceeds—To a; selling stockholder. Office — 588 Commonwealth Ave., Boston, Mass. Underwriter—Hayden, Stone & Co., Bos¬ ton, Mass. ; Laboratories, Berkeley, Calif. Feb. 20 filed 300,000 shares of common stock. Price-* At par ($5 per share). Proceeds—To cover operating during the development period of the corpora* Underwriter—None. Fadaral Commercial Corp. May 21 (letter of notification) 300,000 shares of common stock (par 10 cents). Price—50 cents per share. Pra» eeeds—To make loans, etc. Office — 80 Wall St, New York, N. Y. Underwriter—Dumont Securities Corp., New York, N. Y. Ferro Dynamics Corp. For (12/1) or lease of machinery and working cap¬ Office—Lodi, N. J. Underwriters—Milton D. Blau¬ Co., Inc., New York, N. Y., and Hallowell Sulz¬ berger, Jenks, Kirkland & Co., Philadelphia, Pa. j ner acquisition & Fleetwood Oct. Bonds and Lehman Brothers) $24,000,000 to be Invited) 150,000 com¬ ital. Debentures $40,000,000 Co (Bids to be invited) such of Nov. 12 (letter of notification) 100,000 shares of commas stock (par 25 cents). Price—$3 per share. Proceeds— Preferred Pennsylvania Power Co Common 120,000 $7,500,000 , (Kuhn, Loeb & Co (Monday) Corp.) Montana Telephone filed Derson Mines Ltd. June 5 filed 350,000 shares of expense (Tuesday) Moore-McCormack Lines, Inc $6,035,400 Narda Ultrasonics Corp Bonds $10,000,000 (Morgan Stanley & Co.) $15,000,000 Bell Laboratories, Berkeley, Calif. Ethodont (Monday) Consumers Power Co Michigan Manufacturing Corp (Johnson, Preferred Co Fund) holders supplied by amendment. Pro¬ ceeds—To repay bank loans, and for other corporate purposes. Underwriter—Blyth & Co., Inc., San Fran¬ • Debentures December 8 Morton $15,000,000 (Tuesday) (Bids to be invited) Abacus shares Inc Boston invited) the Nov. Debentures Postponed Financing -/(Offering to stockholders—underwritten by The (Thursday) & Common stockholders—not be to 17 (par $1). Mass. Utilities Co Preferred Pierce, (Friday) Telephone & Telegraph Co (Offering to Equip. Trust Ctfs. $5,850,000 (Offering to stockholders—underwritten by Johnston, Lemon & Co.; Eastman Dillon, Union Securities & Co. and December 5 Carolina (Thursday) invited) with stock Government Employees Variable Annuity Life Insurance Co Common (Thursday) Co.) & Cutter tion. Co., Inc.; and $5,000,000 Ambassador Oil Corp (Dempsey-Tegeler be January 20 $25,000,000 Lynch, Baird 18 into entered Epsco, Inc. .Bonds Ry to States Utilities , Common Merrill (Tuesday) - 700,000. shares Co William Blair & ; - Corp.; Gulf Common Smith) Bonds Robert W. $5,000,000 invited) $12,500,000 January 19 Wisconsin Public Service Corp (The First Gulf States $25,000,000 (Offering to stockholders—to be underwritten by Lynch,-Pierce, Fenner & Smith) $210,000 V agreements shares; the balance to be used to augment the pany's working capital. Office—2242 Grove St., cago, 111. Underwriter—Hemphill, Noyes & Co., York. "r ■'/ •. '/ : •. • (Bids to be received) $10,000,000 Union of South Africa United States Freight Co.) Bonds (Dillon, Read & Co. Inc.) »'• (Bids $10,000,000 Co._ Fenner be January 13 Public Service Electric & Gas Co (Merrill & Diego Gas & Electric Co shares Co Electric Power Pierce, Eastman Dillon, 300,000 EST) a.m. and to January 8 San Preferred & Union Securities Montana-Dakota Bonds $5,000,000 Corp (Paine, Webber, Jackson Lynch, shares Light Co (Bids : (Allen & Co. and W. C. Pitfield & Co., Ltd.) General Acceptance Merrill 800,000 Debentures Noyes Norfolk & Western Ladenburg, Campbell Chibougamau Mines, Ltd * $1,000,000 .Common and Smith) December Thalmann & Co.) $25,000,000 , . & (Bids & Austria (Republic of) . -Debentures December 16 Dominick and Co. & & (Hemphill, Doininick) $27,500,000 ; to — (Monday) shares Class A Common M. (Thursday) M. Loeb, Rhoades & Co.) Rhoades M. (Wednesday) Arvida Corp. 11 Proceeds—$1,176,000 to be used to pur-i 12,000 outstanding 3^% cumulative preferred ($100 par) at a price of $98 per share, pursuant chase shares Dutch West India Cuneo Press, Inc Common Incorporated) EST) $50,000,000 noon Columbia Gas System, Inc shares World Wide Helicopters Ltd <■-. .Bonds Common (Carl Common Common & amendment. shares of shares Belock Instrument Corp Jackson & Curtis) $48,375 Noyes Co.). 126,780 December 15 Common Grocery Co - & (Morgan Stanley & Co.) 2,410,000 shares (Carl ;: Von's rights Common Barney December (Blyth & Co., Inc.) 260,000 shares Vocaline Co. of America, Inc. 65,952 Upjohn Co. Webber, T. I. M. E., Inc (Paine,- Webber, EST) a.m. shares Preferred Jackson & Curtis) < . & Power Co Common r Common Union Colorado 11 (Bids Papercraft Corp. (Wednesday) Philadelphia Electric Co Bonds .u $70,000,000 (A. C.) Co Corp. and Merrill Lynch, Pierce, Fenner & Smith) $7,830,000 J EST) a.m. Debens. Carolina Telephone & Telegraph Co.__*.__Common -Common (Offering to stockholders—underwritten by Equitable Securities . ■ television (Newhard,-Cook & Co.; Reinholdt.& Gardner; Stifel, Nicolaus & Co., Inc.; and Scherck, Richter Co.) 100,000 shares Common - Debens. Anheuser-Busch, Inc. Common - 150,000 shares and Dominion Securities Corp.) December 10 (Tuesday) Pacific Gas & Electric Co.-. 11 Underwriter—None. ^rCuneo Press, Inc. (12/15) ' i Nov. 20 filed $5,000,000 of convertible -subordinated debentures due Dec; 1, 1978. Price—To be supplied by Common $240,000 Southern Bell Telephone & Telegraph Co $300,000 Productions, Inc.- _Debentures $28,559,000 ...Common First National Bank in Dallas, Texas < Inc.) v' (Baclie & Co.) 525,000 shares /. costs and other corporate purposes. per (Tuesday) Common (Harriman Ripley & Co.,. Inc. (Hornbloweiii& Weeks) 219,408 shares Desilu $564,225 Metropolitan Toronto (Municipality of) ...Common Co underwritten) Lomasney & Co.) (Blyth & Co., 90,218 shares 1 ■ December 2 Crouse-Hinds stockholders—not (Myron A. underwritten) Woolfoam Corp. .(C. Cuban-Venezuelan Oil Voting Trusts, Havana, Cuba March 31 filed 767,838 units of voting trust certificate* each certificate representing the ownersliip of one sham of common Btock (par one-half cent) in each of 28 Cuban companies; Price—To be supplied by araenfe ment. Proceeds—For capital expenditure* exploration cisco and New York. Common "$159,460,400 . The Cutter Laboratories Common Pacific Telephone & Telegraph Co._^. by Corp.) $11,226,000 Cardinal Instrumentation Corp. Sulzberger, $300,000 (Offering to stockholders—no underwriting) * Preferred Boston (The Johnson, Lane, Space Corp., W. E. Hutton & Co. and J. H. Hilsman & Co., Inc.) $1,250,000 Common Gray Manufacturing Co shares stockholders—underwritten December 9 Hallowell Common 515,021 American Art Metals Co.__ Common & Co., Inc. and Kirkland & Co.) Jenks, to (Monday) (Auchincloss, Parker & Redpath) $600,000 Blauner Corp.) West Ohio Gas Co $206,105 Ferro Dynamics Corp D. to First ...Common Bowl America Corp. (Milton Securities Northwest Airlines, Inc Common — tH. J. Weinberger Co. and Walter R. Blaha & Co., Inc.) $300,000 (Edwin : 1 • National Old Line Insurance Co.__ ■> Debentures (Wilson, Johnson. & Higgins and Lester, Ryons & Co.) $1,000,000 —_ - Nov. 28 Engineering Co., Inc Relur Corp. r Cryogenic Engineering Co. Sept. 22 (letter of notification) 150,000 shares of class \ common stock (par 10 cents); Prlcer~$2 per share. Pre* coeds — For repayment of loan; purchase of plant cuvl office equipment; raw. materials and supplies; and fat working capital, etc. Office—U. W. National Bank Bldg* 1740 Broadway, Denver, Colo. Underwriter—L. A. Hueyi Denver, Colo.:. k-.11 24 Motel Corp. (letter of notification) $294,000 of 10-year 6% Price—At par (in de¬ convertible debentures due 1968. nominations of $100, $500 and $1,000. construction Proceeds — For of a five-story motor, hotel. Office—1400, National Bank Bldg., Philadelphia, Pa/ Underwriter-—R. P. and R. A. Miller & Co., Inc., Phila¬ delphia, Pa. Philadelphia Continued on page 42 42 (2234) The Commercial and Financial Chronicle... Thursday, Continued jrorn page 41 Grand Oct. Flintkote Co. Not. 10 filed 132,416 shares of $4.50 series A convertible second preferred stock (par $100) together with 330,043 [On Dec. 1, 1958, the Hankins Container Co. will be merged into Flintkote; and on the same date Flintkote will acquire all of the outstanding stock of Orangeburg Manufacturing Co., Inc., in exchange for shares of $4.50 series A preferred stock. Under the terms of the merger agreement with Hankins, each of its 267,458 outstanding common shares shares of common stock (par $5). Union Co. both of filed 29 187,534 shares of common stock (par $5) to be offered in exchange for outstanding common stock of Sunrise Supermarkets Corp. at the rate of one share of Grand Union The stock. stock for offer is each subject shares held Flintkote plan for acquisition of Orangeburg Manufacturing, Flintkote will assume that company's liabilities and issue to it 132,416 shares of the new $4.50 series A preferred. Orangeburg Manufactur¬ ing will be dissolved, and the Flintkote preferred shares will be distributed certain of its to J Fluorspar Corp. shareholders.] of America Oct. 14 (letter of notification) 133,333 shares of common (par 25 cents). Price—$2,25 per share. Proceeds— For mining expenses. Office—4334 S. E. 74th Ave., Port¬ land 6, Ore. Underwriter — Ross Securities Inc., New York, N. Y. t (par $1). Price—$1.25 per share. Proceeds—To pay short-term loans and for completing company's Port Development to general funds. Office Fort — Pierce, Fla. Underwriter—Frank B. Bateman, Ltd., Palm Beach, Fla. • General Acceptance Corp. (12/3-11) 300,000 shares of voting preferred stock, convertible series. Price—To be supplied by amendment. Proceeds—For expansion and working capital. Under¬ writers—Paine, Webber, Jackson & Curtis and Eastman Dillon, Union Securities & Co., both of New York. Nov. 10 filed Dec. on ercise of warrants which 22). Proceeds :— For of Haverhill are such Boston, Mass. Gas Oct. 1958. of of Underwriter—To be determined by competitive bidding Inc., and The First Bos¬ ton Corp. (jointly); Kuhn, Loeb & Co.; Lehman Brothers, and Glore, Forgan & Co. (jointly). Bids—Had been scheduled to be received up to 3:45 p.m. by shares of oversupscription privi¬ Price—$5 per share. Proceeds—For investment. Underwriter—Stone & Web¬ ster Securities Corp., New York. an Dec. 2. convertible common stock preference held on stock or for about rights. Price — At par. Proceeds —To repay debts, acquisition of investments, and for general pur¬ poses. Address—P. O. Box-348, Albany, N. Y. Under¬ ★ Hecla-Checkmate Mining & Development Co; ; Nov. 12 (letter of notification) 300,000 shares of common stock. Price At par ($1 per share)/ Proceeds — For mining expenses. Office—710 S. Fourth St., Las Vegas, — Underwriter—None. v/j V : ' • Oct. 22 stock if Highway Trailer Industries, Inc. "■ / J 24 filed 473,000 outstanding shares of common stock. Price At prices generally prevailing on the American Stock Exchange. Proceeds—To selling stock¬ Nov. — Office—250 Park Ave., N. Y. Underwriter— None. the basis of IV2 warrants per share of stock held 6, 1959 (216,429 shares Co., on on Jan. are now outstanding); and (3) to (par $5) of Government Em¬ on the basis of V2 warrant per share of stock held on Jan. 6,1959 (as of Sept. 30, 1958 there were 143,127 shares of stock outstanding and holders of common stock ployees Corp., $614,360 of 5% convertible capital debentures due 1967, convertible into shares of common at $28.0374 per share. If all these debentures were converted into common stock prior to the record date, a total of 164,724 common shares would be outstanding). Price — $3 per share. Proceeds For — capital and surplus. Office—Government Employees In¬ Washington D. C. UnderwritersJohnston Lemon & Co., Washington, D. C.; Eastman Dffion, Union Securities & Co., New York; and Abacus Fund, Boston, Mass. surance Building, Grain Elevator Warehouse Co. Nov. 3 filed 100,000 outstanding shares of common stock (par 10 cents). National Alfalfa Dehydrating & Co., holder of the 100,000 offer to its stockholders Milling common shares, proposes to preferential warrants to sub¬ scribe to 98,750 shares of Grain Elevator stock on the basis of one warrant to purchase one-eighth share of Ghraixr Elevator stock for each share of National Alfalfa common held on Nov. 17, 1958; rights to expire Dec. 31. Price—$2 per share. Proceeds—To selling stockholder/ Oifiee-*927 Market Street, Wilmington, Del. Under¬ writer—None. June 12 filed 27,000 shares ol capital stock. Price—$10 share. Proceeds—To be used in part for the ex¬ ploration of mines and development and operation of mines and in payment of indebtedness. per Office—Tucson, Ariz. • Underwriter—None. 1 * •" general per , (par $5). share. corporate Bldg., Tulsa, Okla. Proceeds—For working capital and purposes. Office 2202 Philtower Underwriter—None. — capital and general corporate purposes, including the fi¬ nancing of increased inventory and receivables. Under¬ writers—Tabor & Co., Decatur, 111., Fusz-Schmelzle & Co., Inc., St. Louis, Mo., and Ellis, Holyoke & Co., Lin¬ coln, Neb. bank Sloans incurred At — of .($1 par that for* -share). per "unit, furnishings for purpose. w common Proceeds — For same, . Ernest Serfas is President. 1 7 Lake OhtaribPprjtlatid Cement Co., Ltd. >Oct. 29 filed '671 ,'376 khhr.es of cbmmon stock and war¬ rants construction program. Underwriter—To be determined by competitive bidding. Probable bidders: Halsey, Stuart & Co. Inc.; Eastman Dillon, Union Securities & Co.; The First Boston Corp.; Harriman Ripley & Co. Inc. Offer¬ ing—Date indefinite. Industrial Minerals for/the ^uichase/of being offered to ~ common (coftSisting/of unit additional 671,376 shares an shareholders at the rate of One one common share and one warrant) Corp., Washington, D. C. July 24 filed 600,000 shares of common stock (par one cent). Price—$1 per share. Proceeds—To develop and operate graphite and mica properties in Alabama. UnlerWriters—Dearborn & Co. and Carr-Rigdom & Co., > for each1 two shares held as of 'Nov. 25, 1958 /(with Ian oversubscription privilege); rights to expire on Dec. 12; 1958. Price—$2:25 per unit (payable in either Canadian or U.. S. -dollars) ".*'<■ -Proceeds—For construction program and for corporate purposes. Office -— Picton, Ontario, Canada.* Underwriter—None; The :company's two prin¬ cipal shareholders, together with Kidder, Peabody & Co. and Nesbitt;.Thom^Oit'&v Company, /Limited, have agreed that they will subscribe for a total of 343,432 units. y... if Lance, Inc., Charlotte, N. C. ; 1 14 (letter of Notification) 1,584 shares of class A Nov. voting stock (par,. $5), and 2,376 shares of class B non¬ voting stock,; (par>.$5) to;be offered to employees pur¬ to "Lance Employee Stock- Plan.".. Price—$12,50 per share. Proceeds—For working capital. Underwriter suant ; , —None. -•/■-/;• ' V.' *> Laughlin Alloy Steel Co., Inc. v : 7 Aug. 28 filed $500,000 of 6% subordinated callable de-> bentures due June 30,1968, and 150,000 shares of common stock (par 10 cents) * to be offered in. units of $108-of debentures and 30 common shares. Price—$100 per unit. Proceeds—Together with a $175,000 mortgage loan from the American Brake Shoe Co., will be used to meet ex¬ penditures1 in acquiring latter company's South San Francisco foundry and for working capital. Offices—Las Vegas, Nev.; and South San Francisco, Calif. Underwriter . —Sam Watson-Co.; Inc., Little Rock, Ark., efforts basis.;/; Life *7; ■ on best a r Insurance Securities Corp. 1,008,000 shares of capital stock (par $1). Price—$5 per share, ^Proceeds—To acquire stock control jf "young, aggressive and expanding life and other inmrance companies .and related companies and then to jperate such, companies as. subsidiaries." Underwriter— first Maine ^orp.«;Portland, Me. ; ' \0 kfarch 28 filed , Ling Electronics, Inc. / $922,300 of 5 ?A % subordinated convertible debentures due: Dec. lr 1970; to be offered in exchange on the basis equal ^principal amounts for the out¬ standing 3% eenveirible subordinated income notes due 1967 of the Galidyne Co., will offer rio notes from those notes for 'cakhf Inc., purchase • a subsidiary.;The at stockholders face who at <a pried' equal to cipal amount^" Loriflarir^P;)/ Co ":;v; / New York value desire 100% /. : com¬ Calidyne their to sell of their prin¬ ; ■, . . . * ?/ Nov. 5 filed 364,670 shares of common stock (par $10), being offered Tor subscription by common stockholders at the rate of one'new share for each eight shares held on Nov. 25; rights 'to expire on Dec.' 9. Price—$68 per share. Proceeds—To/be added to general funds of the company and used for short-term and Michigan Electric Co. Sept. 26 filed $20,000,000 of first mortgage bonds due Nov. 1, 1988. Proceeds—To retire bank loans used for • < opening in¬ ventory, and other working capital. Office—5005 South La Brea, Los Angeles 56, Calif. Underwriter — None. pany Honeggers' & Co., Inc., Fairbury, III.-> Nov. 7 filed 19,000 shares of common stock, of which 18,000 shares will be sold for the company, and 1,000 shares for a selling stockholder. Price—$30.50 per share. Business—Manufactures and sells formula feeds for live¬ stock, animal and poultry, farm animal shelters and re¬ lated equipment and supplies. Proceeds For working Indiana & / Oct. 28 filed ~ Home-Stake Production Co., Tulsa, Okla. 5 filed 116,667 shares 6f common stock Nov. Price—$6 : ; ,v < (par $10): stock common (lettenqf notification) 300,000 shares of Price construction 1, Hoagland & Dodge Drilling Co.r Inc. (par $1) to be offered by company on or about Jan. 20, 1959 viz: (1) to holders of common stock (par $4) of Government Employees Insurance Co., on the basis of one warrant per share of stock held on Jan. 6, 1959 (1,334,570 shares are now outstanding); (2) to holders of common stock (par $1.50) of Government Employees Life Insurance Under¬ Smith, New; V* ■ shares of re-* 1958., 1, if Lake Mead Echo Bay Lodge, Inc. Stockholders will have 45 days in which to exer-' ' Government Employees Variable Annuity Life Insurance Co. (1/20) Nov. 13 filed 2,500,000 shares of common stock temporary stock. each Nov: the holders. 4% stock dividend of Nov. E.i 19th Avenue, Portland, pre. 3 filed 206,446 Nov. 14 non¬ Heliogen Products, Inc. (letter of notification) 28,800 shares of common (par $1). Price—$5 per share. Proceeds—For payment of past due accounts and loans and general working capital. Office — 35-10 Astoria Blvd., L. I. C. 3, N. Y. Underwriter—Albion Securities Co., Suite 1512, 11 Broadway, New York 4, N. Y. on the pay Underwriters—Blyth & Co., Inc., New York, and J. J.;B. Hilliard & Son, Louisville, Ky. stock (par*' $12) to be stockholders on the basis (EDT) on May 13 at Room 654, 101 Indiana Ave., N. W., Washing ton 25, D. C., but bidding has been postponed. of common being offered for subscription by common stockholders of record Nov. „17, 1953, at the rate of one share for each 12 shares then held; rights to expire on Dec. 8. Price— $33 per sharer; Proceeds—To .finance part of the com¬ pany's construction expenditures;! including the payment preference Nev. share for of . Probable bidders: Blyth & Co., General Public Service Corp. Oct. 29 filed 2,478,264 shares of common stock being of¬ fered for subscription to common stockholders shares 938 . Kentucky/ Utilities Co. v • Corp., New York shares of common A stock (ne par) and 1,537,500 shares of common B stock (par $1) Proceeds—To the Attorney General of the United States (with • Nov. of writer—None. 14, 1957 filed 426,988 notification) Lynch/ Pierce, Fenner & York, N. Y^■: fry • offering.] subscription share of writer—Merrill Co., Haverhill, convertible for (letter Office—411 N. to be sold at 25 cents per Development Corp. (letter of notification) 22,820 23 voting 21 .-V* stock Heartland cise lege); rights to expire Oct. Underwriter—None. Mass.,; (12/3) > Nov. 12 (letter of notification) 12,285 shares of capital stock (par $10) to be offered for subscription by stock¬ holders of record on Dec. 3, 1958. Price—$20 per share. Proceeds—To repay bank loans.!.Under writer—None. install machinery and equipment. Office—367-405 West First St., Boston, Mass, Underwriter—William S. and new ; . Inc..;.:/-:/'/••■7/ Jantzen, 1,000,000 shares of common stock (par- 25 cents). Price—$2 per share. Proceeds—To acquire funds to test drill, explore, and develop oil and gas properties Underwriter—None. [The registration includes an ad¬ ditional 588,000 common shares issuable upon exercise of 1,176,000 options rights previously offered (Oct. 19, 1957), which rights entitle the original purchaser thereof to purchase one-half share of stock at 50 cents per share at the expiration of 13 months after com¬ shares one <; , Building,. 1750 E. Sunrise Boulevard, Ft. Lauderdale/ Fla., Underwriter—None. Hamilton Oil & Gas Corp. one the basis of lantic Federal Underwriter—None. Oct. 22 filed 10 on ■ 9 (letter of notification) 55,555 shares of common» (par two cents). Price—$4.50 per share. Proceeds —For capital account and paid-in surplus. Office—At-« writer—None. of held (par 10 price. Pro* stock market stock organizers, incorporators, management Price—$10 per share. Proceeds—Foi working capital and general corporate purposes. Under¬ employees and the remainder to the public. PriceTo employees, $1.1805 per share. Proceeds—To purchase 18, 1958 the Investment Corp. of Florida Oct. to warrant to each two shares common to working capital and to enlarge research and levelopment department Underwriter — &. D. Fuller A Co., New York. Offering—Being held in abeyance. •:> Guardian Insurance Corp., Baltimore, Md. Aug. 16, 1957, filed 300,000 shares pf common stock, 0) which 200,000 shares are to be publicly offered and th« remaining 100,000 shares reserved for issuance upon ex offered record Nov. be related suiting from W., Washington, D. C. ^ General Alloys Co. Nov. 17 (letter of notification) 45,250 shares of common stock (par $1) of which 16,900 shares are to be offered General Aniline & Film expire 150,-000 shares of (par$l).* Price—At the; market. Proceeds—To stockholders iri cash fdr ;their fractional interests mencement General Aero & Electronics Corp. Sept. 29 filed 500,000 shares of common stock (par 10 cents), of which 100,000 shares are to be sold for the account of selling stockholders. Price—$2.25 per share. Proceeds—For acquisition of stock of National Missile & Electronics Corp., additional working capital and other corporate purposes. Underwriter—Willis E. Burnside & Co., Inc., New York. Jan. to amendment. IN. Y.) Guaranty Life Insurance Co. of America Nov. 14 filed 88,740 shares of class A common capital stock (par $1.80). Price—$5.35 per share. Proceeds—To increase capital and surplus. Office—815 15th Street, ;■ Prescott & Co., (rights filed ents), Price-t-To ; ... Corp. *eds—For and/or directors. if Fort Pierce Port & Terminal Co. Nov. 25 filed 2,138,500 shares of common stock added four Price—To be supplied by 28 best efforts basis. State¬ on a N. - stock Plan and rest treb. Sunrise Gray Manufacturing Co., Hartford, Conn. (12/1) Oct. 28 filed 90,218 shares of capital stock (par $5) to be offered for subscription by common stockholders oi record Nov. 25, 1958 at the rate of one new share for general corporate purposes. the shares of acceptance • each Under 2.409 Industro Transistor by at least 80% of the outstanding Sunrise shares by Dec. 31. will be converted into 1.234 shares of Flintkote common, which will result in the issuance of 330,043 shares of common. to Washington, D. C., effective, Nov. 18. ment November 27, 1958 cprpbrate bank loans: purposes, including reduction of Underwriters—Lehman Brothers Smith, Barney ;& Co., both of New York. Los Alleles Drug Go; — ; Oct. 3 filed for pro 50,000 shares of capital stock, to be offered subscription /by holders of outstanding stock, oil a rata basis.; Any shares not so sold will be offerecFon exchange/basis to holders of outstanding 5% sinking Price—$10.50 per share to stockholders; $11.50 to public. Proceeds—$328,300 to redeem outstand¬ ing 5% sinking fund debentures and $189,200 to reduce an fund debentures. short term bank loans. Office—Los Angeles,. Calif. Un¬ derwriter—QuincyCass Associates, Los Angeles, Calif. Lowensteih (M.) & Sons, Inc. Nov. 7 (letter of notification) 3,225 shares of common stock (par $1) to be offered on a basis of IV4 shares in Volume 188 Number 5798 . . The Commercial and Financial Chronicle . (2235) exchange lor,one share of capital stock of Wamsutta Office—143€ Broadway, New York, N. Y. . Under¬ writer—None.V -C; \y.,-«* r; Eastman MiJtls. LuHocMining Corp.- c - Sept. 2ft filed 350,000 shares of common stock.' - Price—$ 1 per shate: Proceeds — For the acquisition of properties under option and for various geological expenses; test , Dillon, Union Securities & Co.; Kidder Peaaody & Co., Smith, Barney & Co. and4 Ely th St Co., Iiic. '(jointly). Bids—Had been expected to be received up to noon (EDT) on Aug. 26 at Room 2033, Two Rector St., New York, N. Y., but company on Aug. 22 again decided to defer sale pending: improvement in market conditions The stock of shares $55 the basis of one new share for each held; unsubscribed shares to employees; per share. Proceeds—To Smith, Barney & Co., Kidder, Peabody & Co. and Blyth Co., inc. ■, • Marcus Transformer Co., lnc. • Mortem Manufacturing Corp. (12/8-12) ft Nov. 17. filed — Price— , . Mankato, Minn. Motion .* Picture Investors Inc. July It filed 200,000 shares of common stock (par $1). Price—$10.75 per share.: Proceeds—For investment. Of¬ (12 1Q-15) (letter of notification) 75,000 shares,.of,.common (par 10 cents). Price—$4 per share. Proceeds— fice—1000 Power & Light/Bldg., Kansas City, Mo. Un¬ derwriter—None. new production equip¬ Nardo Ultrasonics Corp. (12 8) working capital. Office—900 Leesville Ave., :: Nov 4 filed 60,000- shares of common stock (par 10 Rah way,'.N, J. Underwriter—Berry & Co., New York, n. y. cents). Price — To be supplied by amendment. Proceeds i.,v- ' .v ' • —To Narda Microwave. Corp., the selling stockholder. • Marine and Corp., Milwaukee, Wis.v/-%; Underwriters Nov. 10. filed 501,500 shares of common stock, (par $10) exchange for all the issued- and outstand¬ - to be offered in and (4) shares of South To train out the sliaires Inc. and projected to implement and carry development and operation. persons plan of Pearl Underwriter- National Old Lino Life Insurance Co. outstanding shares of class BB common stock.- Price—To be^ supplied by amendment. Proceeds—To selling stockholders. Office—Capital Ave. and Wood Lane, Little Rock, Ark. Underwriter—Equitable Securities Corp.; Nashville, Tenn. Offering—Ex¬ pected the second or third week of December. . , • ;>"> of common ^ Nayior Engineering :ft Research Corp. Sept. 29 (letter of notification) 300,000 shares of cumulative. voting, and non-assessabl0 common stock. Price— At par ($1 per share). Proceeds—For organizational ex¬ penses and first three months' operational expenses. Of¬ forrsubscr$ption by stockholders of record Oct. 15, 1953 on the basis of one now share for each five shares held; rights to expire Dec. 15, 1958., ""iUrt subscribed shares may be offered to fice— 1250 Wilshire Blvd., Los Angeles IT, Calif. Underone or morepersons sclebted by the. board of directors. ; writer—Waldron & Co., San Francisco 4, Calif. Price—$1.40 per share. Proceeds—Tci reduce loan; Vv^Ntduw Oil Tool Co.; May 5 (letter of notification) 150,000 shares of common stock (par one eent)v. Price—$2 per share. Proceeds—To Underwriter pay loan; to acquire fishing tools for leasing; and for it Metropolitan Toronto ' (Municipality of) ; (12/9) working capital. Office?—931 San Jacinto Bldg., Houston, Nov) 25 filed $5,852,000 of instalment Tex: Underwriter—T. J. Campbell Investment Co., Inc., debentures, ma¬ turing from Dec: 15* 1959 through-1977; and-$22;707,000 Houston, Tex. V:'v " /; ; of sinking-fund debentures; maturing in T978^ ; 1983, and .* Nelson Fund, Ire. 1988. Price—To be supplied' by amendment; Proceeds Nov. 20 filed 600 shares of capital stock (par $1,000). —For various public works projects. - Underwriters— Price—At market. Proceeds—For investment. Office— Hatrimah ftipley & "Co., Inc. and Dominion - Securities 37 Wall St.? New York, N. Y. ; Corp., both, of New York, and five other firrfts./ " ' + Nielsen (A. Cri Co. (12/10-11) Mid-Attarrtic Marina, Inc., Baltimore/ Mid. v Nov. 20 filed 126,780 shares of common stock (par $1), Oct. 28 (letter of notification)■ 60,000 shares oL 7% pre¬ of which 64,500 shares are to be sold for the account ferred stock (par $3.50). Price—$5 per shake.' Proceeds— of the company and 62,280/shares for the account of For ; ■ . - ' construction of Town Bank? land Securities Miles Nov. a Office marina. Bldg:, Baltimore 2, Md. — Room 104, Old ■;/ * - subScHptioh by com¬ mon-stockholders of record Dec.; 4, 1958 in the..ratio of $100 of debenturse for each 20 common shares held; rights will expire on Dec. 19; 1958. Price—Tb be'supplied by .amendment.. Proceeds—For expansion .program and general corporate Nov. purposes. pay 17 (John E.) Co.:;;- The First , (letter of notification)'; 500 rata basis. instalment shares .of'common subscription t>y;sifd(ekhdfders on a per share.r Proceeds—To Price—$100, orr a St:; Dallas,, Tex. note d ue . " Office—3800 Coftimerce Underwriter—None. Mobile Heme Park v\./V Development Corp. 25,000 shares of Nov. T# (letter of notification) stoek. U — Corp:, New York. stock to be offered for pro Underwriter common Frice%-At further1 leans par, ($10 per Share). Proceeds—For and other working ^pital. ^ Office—176 West Adams / St/; Chicago,' 111.;. Underwriter—None; Montana-Dakota Utilities Co. (l2/5).r 4' * "... ■ NoV.. 7 filed $10,000,000 of first mortgage bonds due Dec. 1, 1983. Proceeds—To repay short-term bank loans in the amount of $9,000,000 and for construction program. Underwriter—To be determined by competitive bidding. Probable bidders: Halsey, Stuart & Co. Inc.; Blyth & Co., Inc.; Merrill Lynch, Pierce, Fenner & Smith'.and Kidder, Pea body & Co. (jointly); Blair & Co: Bids—Expected to be received up to 11 a.m. (EST) on Dec. 3. Montana Power Co. July 1 filed $20,000,000 of first mortgage bonds due 1988. Proceeds Together with other funds, to be used to repay $15,500,000 in bank loans and" to .carry on the company's- construction program through 1959. Under¬ — writer—To- be determined by competitive bidding. Prob¬ able bidders: Halsey, Stuart & Co. Inc.; Lehman Bros.; Merrill Lynch, Pierce, Fenner Sc Smith, and Stone & Webster Securities Corp. (jointly); White, Weld & Co.; Proceeds Price—To be supplied by amend¬ To be used for corporate purposes, including expansion, improvements, etc. Office—2101 Howard St.; Chicago, 111. Underwriter—Smith, Barney & Co., Chicago and New York. Inc. bentures due. 1978, to be offered for * Mitchell ment. (12/5) $6,035,400 of convertible subordinated de¬ 14 filed Boston selling stockholders. Underwriter—Mary¬ Co.; Baltimore, Md. Laboratories, O. T. C. ; March ; > — Northwest Airlines, Nov. 13 Inc..';* (12/8) filed 449,040 shares of cumulative preferred stock, convertible series (par $25) to be offered for sub¬ scription by common stockholders on the basis of one preferred share for each three common shares held on Dec. 5; rights to expire on Dec. 22. Price—To be sup¬ plied by amendment. Proceeds — Together with other funds; to liquidate the borrowing under the- present credit agreement with banks now amounting to $34,000,000, and the balance, together with cash generated from depreciation and retained earnings will be applied to¬ ward the acquisition of the new turboprop and turbojet aircraft and related spare parts, equipment and ground facilities, and for other corporate purposes. Underwriter •—The First Boston 6 Enterprises Inc. (letter of notification) 23,200 (par $1).; Price—$5 class B stock shares per of. share. ■ . , Pacific Gas & Electric Co. (12/2) Nov. 7 filed $65,000,000 of first and refunding mortgage bonds, series DD, due June 1, 1990". Proceeds—For cost of utility property additions. Underwriter—Tb be dteterimined by competitive bidding: Probable bidders: Hsdsey, Stuart & Co. Inc. and The First Boston Corp. (jointlyX; of common (par 10 cents): Price—$1 per share. Proceeds— For acquisition of additional1 gas and oil interests and corporate administrative expenses. Office—150 Broad¬ New York 38, N. Y. Underwriter Co., Inc., New York 5, N. Y. 8:30 am. — Greenfield & Oak Ridge, Inc. Sept. 4 (letter of notification) 100,000 shares of common stock (par $1). Price — $3 per share. Proceeds — For working capital. Office—11 Flamingo Plaza, Hialeah, Fla. Underwriter—Henry & Associates, Inc., 11 Fla¬ mingo Plaza, Hialeah, Fla. Pacific Oct. 24 mon up> tb Telephone & Telegraph Co. (12/1) 1,594,604 shares of common- stock to be subscription by holders of outstanding* com¬ filed offered for and preferred stock of record Nov. 26, 1958 on theone new share for each eight common orprr- basis of ferred shares Price—At par held; rights will expire on Dec.. 30,, 1953. ($100: per share).. Proceeds—To repay ad¬ from American Telephone & Telegraph. Co.. Un¬ derwriter— None.: Control — Of the 832,000? share* «£ vances . 6% preferred stock (par $100): and U,936,P35; shares of common stock (par $100) outstanding, as of Gc±„24^.1968, there were owned by the American Telephone & Tele>graph Co. 640,957 prefei^*ed shares and 10,790,943* com¬ shares.,, ■..■■••'.V Papercraft Corp., Pittsburgh, Pa.. (12/2) Nov. 12 filed 250,000. shares of common stock, (par $1). Price—To be supplied by amendment. Proceeds—To .sell¬ ing stockholders. Business—The corporation is a leading manufacturer and distributor of for all occasions. Securities & gift wrapping products Dillon,. Union Underwriter—Eastman Co.,, Chicago, 111. u May 19 filed 20,000 shares of common stock (par $1)^, Price—At market. Proceeds—For investment. Under¬ writer—Investors Investments Corp.* Pasadena* Calif. Peninsular Metal Products. * Corp.. Oct. 6 (letter of notification) 10,000 shares pf common Price—At market, (not. to exceed an ag¬ gregate of $100,000). Proceeds—To a selling stocidiokleir. Office—1365 Jarvis, Ferndale, Mich. Underwriter—-Wnn C. Roney & Co., Detroit, Mich. stock (par $1). Pennsylvania Power Co. Aug. 1 filed $8,000,000 of first mortgage bonds due 1099; Proceeds—To gage redeem bonds due 1987. a like amount of 5% Underwriter—To be first mort¬ determined by competitive bidding. Probable bidders: Halsey, Stuart & Co. Inc.; Kidder, Peabody & Co.; White-Weld & Co.; Equitable Securities Corp., and Shields & Co; (jointly); Lehman Brothers; Eastman Dillon, Union Securities 8c Co., Salomon Bros. & Hutzler and Ladenburg, Thahnann & Co. (jointly); Merrill Lynch, Pierce, Fenner 8c Smith" and Dean Witter & Co. (jointly)': Bids — Tentativelyhad been expected to be received up to 11 on Aug. 27 but company on Aug. 22 a.m. fEDT> decided tb defer sale pending improvement in market conditions./ -Philadelphia Electric Co. (12/10) $50,000,000 of first and refunding mortgage 1, 1986. Proceeds—To be used to finance Nov. 13 filed bonds due Dec. construction program and to repay bank loans. Under¬ writer—To be determined by competitive bidding. Prob¬ able bidders: Halsey, Stuart & Co. Inc.; Morgan Stanley Co. and Drexel & Co. (jointly); The First Boston; Corp.; White, Weld & Co., Bids—Expected to be received up to noon. (EST) on Dee. 10. & Pioneer Trading Dorp., Rayonne, Hi J. 10,000 shares of $8 cumulative preferred stock, series A (par $100) and $l,Q00;OO8of 8% subordin¬ ated debentures* series: A, due Dec-.. 1, 1968b tor be offered Nov. in 10 filed units of $500 debenture and five shares of. pre¬ Price—$1,000 per unit. Proceeds — For general corporate purposes. Underwriter^—None. ferred a. stock. ! Polaroid Corp. ing offered for subscription by common; stockholders: a£ record Nov. 25,. 1958 on the basis of one new share for each 21 shares then held;, rights to* expire- on Dee. ft, Price $70 per share. Proceeds—For expansion and — working capital. convertible debentures and 250,000 shares of common stock (par 10 cents). Price —Debentures at 100% and stock at $3 per share. Pro¬ ceeds—To purchase a textile mill, machinery, equipment and raw materials, and to provide working capital. Office —375 Park Ave., New York, N. Y. Underwriter—Harris Securities Corp., New York, N. Y., on a best efforts basis. Underwriter—Kuhn,„Loeb* & Co.* New York. Ponce de Leon Trotting Association, Inc. Aug. 7 filed 400,000 shares of common stock (par ana cent). Price—$1.50 per share.. Proceeds—To pay current liabilities, for new construction and working capital. Office—Bayard, Fla. Underwriter—Robert L. Fermai* Co., Inc., Miami, Fla. Potomac Electric Power Co. Nov. 5Vz% , Packman Plan Fund, Inc.,, Pasadena, Calif. e Odlin Industries, Inc. Nov. 12 filed $250,000 of Bids—Expected to be received! (PST) Dec. 2. Nov. 6 filed 173,616 shares of common stock (par $1> be¬ stock way, Pro¬ completion of plant plans; land; construc¬ • • Gorp;;New York. Northwest Gas & Oil Exploration Co. Aug. 22 (letter of notification)!;300,000 shares com¬ tion and operating expenses. Office—2502 N. Calvert. St.r Baltimore 18,, Md. Underwriter—Burnett & Co.* Sparks, Md. ' v mon (12/8-16) Nov.. 10 .filed. 515,021 , Merchants Petroleum Co., (letter, of notification) '159,395 stotfk (paif 25 cents) to. be offered procure St., Boulder, Colo. Western Securities Co., Boulder, Colo. 80% of the stock of the- bank with respect to ^yfctich the proposal is made. The biter will.terminate err Dec. 31, 19m ;* Oct. 8 and Office—1406 South v/<;* Co., National Educators Finance Corp. June 4 (letter of notifioation) 50,000 shares of common stock. Price—At par (50 cents per share). Proceeds— Milwaukee Bank, Milwaukee, $100 par. Each of the exchange pro¬ posals is* conditioned (among -other, things) .upon ex¬ changes being made with the holders .of qot" less than & C6:,;.bafli' of New York, and six*other \".' underwriters. 17 shares for each of the par; outstanding Milton "D.Blauner • the' 220,000 outstanding shares of Marine National Ex¬ change Bank of Milwaukee, $20 par; (2> 22 shares for each of the-1,000" outstanding shares of. Cud.ahy State Baiik, Cudahy- Wis., $100 par(3) three shares for each of the 7,50O- outstanding shares of, Holton State Bank, 1,000 — Michael G. Kletz & ing} shares of capital stock of the following banks at the indicated ratios of exchange: (1) two shares for each of Milwaukee;, $20 116,000 shares of common (par 35 cents). Price—$1 per share. Proceeda— development of oil and gas properties. Office—513 International Trade Mart, New Orleans 12, La. Under¬ writer—Assets Investment Co., Inc., New Orleans, La. For Blyth & Co., Inc. For purenase ana installation of ment Bldg., New Orleans 12; La. stock ceeds—For 120,000 shares of common stock (par $1). Price —To be supplied by amendment. Proceeds To selling stockholders. Office—2101 Hudson Street, Lynch¬ burg, Va. Underwriter—Johnson, Lane, Space Corp., Augusta, Ga. ; Nov. 6 stock Commerce Nov. 16 (letter of notification) mon seven Underwriter—None. on & complete dial conversion Office—315 South Second St., V"" ! program. common stock (no par) be offered only to bona fide residents Price—To be related to the current market the New : York jStock Exchange.. Proceeds—To¬ will gether with other funds, to carry on the company's con¬ struction program through 1950: Manager-Dealers— . • Mankato Citizens Telephone Co. v r. Nov. 19. (letter of notification) 5,454 shares of common stock (no par) to be offered for subscription by stock¬ on of • Oil, Gas & Minerals, Inc. Montana. price; Co.*,: Inc., Miami,! Fla. Price—$5 per shares Proceeds—To reduce current indebtedness to Walter El Heller & Cos Underwriter—Plymouth Bond & Share Corp.-, Miami, Fla. ;,..■ /_ VCV-vv^V-''*': holders Bank Underwriter—Assets Investment Co., Inc., New Orleans, ■ •;; / July 1 filed 100,000 shares of :%"Vw, 100,000 shares of-common stock. tional La. , Underwriterv—None. W. C. A Credit <, Nov. 4 (letter of notification) 150,000 shares of common stock (par 35 cents). Price—$f per share. Office—Na¬ Montana Pfwer Co. drilling,. purchase of equipment, and other similar pur-, poses. Otfiees—Wilmington;;Deland; Emporium, Pa : Oct 6 filed Oil, Gas & Minerals, Inc. 43 10 (12/3) filed $25,000,000? of first mortgage bonds due 1993. Proceeds—To repay bank loans and for construc¬ tion program. Underwriter—To be determined by com¬ petitive bidding. Probable bidders: Halsey,, Stuart 8c Co., Inc.; Harriman Ripley & Co.rIhcr.; The First Boston Corp.; Kidder, Peabody & Co;, Merrill Lynch^, Pierce, ContimietH on page 44 The Commercial and Financial Chronicle 44 Continued cipal amount. from page 43 Smith, White, Weld & Co. and Fenner & Salomon Bros. (jointly); Lehman Brothers and & Hutzler Eastman Dil¬ lon, Union Securities & Co. (jointly); Dillon, Reed & Co., Inc. and Johnston, Lemon & Co. (jointly). Bids— Expected to be received up to 11*30 a.m.(EST) on Dec. 3. of inces a $1.50) Prov¬ and tc Saskatchewan and Alberta Manitoba, "only in the State of North share. Proceeds — For con¬ residents of the United States Dakota." Price $3 — per Proceeds purpose. Office —Saskatoon, Saskatchewan Underwriter—Allied Securities Ltd., and United Securities, Ltd., both of Saskatoon, Canada. Public Service Electric & Gas Co. (12/3) • — Sheridan-Belmont Hotel Co. to be received Aug. 19 (letter of notification) $250,000 of 6% convertible debentures due Sept. 15, 1963 to be offered for subscrip¬ May 26 (letter of notification) 1,250 shares of common1 (par $10) and $37,500 of 6% serial subordinated debentures series 1958, to be offered m units of one share of stock and $50 principal amount of debentures rata basis. Price— on a pro •tock Sire Plan of Elmsford, Inc., New York (12/22) 6% 10-year debentures and 5,participating preferred stock (par $50) offered in units of a $50 debenture and one share to be offered to Nov. 10 filed $250,000 of to be of 13 filed 700,000 Underwriter Pierce, Fenner & Smith, New York. construction program. — Merrill Lynch, if Putnam Growth Fund, Boston, Mass. 19 filed (by amendment) an additional interest (par $1). Price—At Proceeds—For investment. ; Nov. shares of beneficial 200,000 market. Rassco Financial Corp. $1,000,000 of 15-year 6% series A sinking 1973, to be offered in denominations June 26 filed fund debentures due $500 and $1,000. Price—At par. Proceeds—For work¬ ing capital and general corporate purposes. Underwritei —Rassco Israel Corp., New York, on a "best efforts' basis. Offering—Expected late this year. Southern if Realty & Theatre Ventures, Inc. 18 (letter of notification) 200,000 shares of class A stock (par one cent). Price—$1.50 per share. Pro¬ ceeds—For general working capital. Office—50 Broad St., New York, N. Y. Underwriter—Willis & Co., Inc., New York. E. Burnside if Reid Laboratories, Inc. (letter of notification) 127,284 shares of common Price —At par ($1 per share). Proceeds — For Nov. 14 stock. equipment; inventory and working capital. Office —5B5 Western Ave., N. W., Atlanta 14, Ga. Underwriter office —None. ■ V,* ii Corp. (11/28-12/1) Oct. 16 (letter of notification)1150,000 shares Relur of common 6tock (par five cents). Price — $2 per sare. Proceeds — For inventories and working capital. Office—1007 South 21st Avenue, Hollywood, Fla. Underwriters—H. J. Wein¬ berger Co., Jersey City, N. J., and Walter R. Blaha & Co., Inc., Long Island City, N. Y. Corp., Orlando, Fla. Sept. 22 filed 100,000 shares of class A common stock, Price—To be supplied by amendment. Proceeds—For working capital. Underwriter — Citrus Securities Co., Orlando, Fla. Ltd., Alberta, Canada June 26 filed 1,998,716 shares of common stock (par $1) Of this stock, 1,174,716 shares are to be sold on behalf oi the; company and 824,000 shares for the account of cer¬ tain selling stockholders. The company proposes to offej the 1,174,716 shares for subscription by its shareholder# Richwell Petroleum at the rate of one new share for each three shares held (with an oversubscription privilege). The subscription period will be for 30 days following issuance of sub¬ scription rights. Price—To be supplied by amendment Proceeds—To pay off demand note, to pay other indebt¬ edness, and the balance if any will be added to working capital. Underwriter — Pacific Securities Ltd., Van¬ couver, Canada. - ./ Association 300,000 shares of ' share). Proceed* Offiee—Littleton, Windover Road Routh Robbins Investment Corp. Sept. 22 filed $1,000,000 of 10-year 6% cumulative con¬ vertible debentures and 99,998 shares of common stock Price—Of debentures, at par (in units of $100 each); stock, $1 per share. Proceeds — For investments and working capital. Office—Alexandria, Va. Under¬ and of writer—None. Rural Telephone Co., Knox, Pa. Sept. 29 (letter of notification) 3,000 shares of common stock (par $10) to be offered to stockholders on the basis of one new share for each three shares held; rights will expire on Oct. 31, 1958. Price—$20 per share. Pro¬ ceeds—For installation, construction and working cap¬ ital. Underwriter—None. Service Life Insurance Co. Sept. 26 (letter of notification) 3,567 shares of common stock (par $1). Price—$18.75 per share. Proceeds—To go to a selling stockholder. Office—400 W. Vickery Blvd., Fort Worth, Tex. Co. Telegraph & , . $70,000,000 of 35-year debentures due Dec, 1, 1993. Proceeds—To repay outstanding advances from American Telephone & Telegraph Cos, and the balance will be used for general corporate purposes. Under¬ writer To be determined by competitive bidding. Probable bidders: Halsey, Stuart & Co. Int.; Morgan^ Stanley & Co. Bids—Tentatively scheduled to be re¬ ceived at Room 2315, 195 Broadway, New York, N. Y., to 11 a.m. (EST) on Dec. 9. Southern Colorado > ; ;: Power Co. , : : . during 1957 and 1958 or / share. (12/2) & Paine, Webber,, Jackson & • Underwriter—Kay & Co., Inc., Hous¬ ton, Tex. * • duce first lien mortgage 6% bondt and 975,000 shares of common stock (par 10 cents). Prta —For bonds, 95% of princmal amount; and for stock $1 per share. Proceeds—To erect and operate one or mors chemical processing plants using the Bruce - William# Process to beneficiate manganese ores. Underwriter- . : Super Food Services, Inc. preferred stock, first series, series, to purchase a like shares to be offered in units of one preferred share and one warrant (warrants are exercis¬ able at $2.50 per common share). Price—$20 per unit. Proceeds—To purchase outstanding shares of F. son Co. Underwriter—W. H. Tegtmeyer & Co., N. John¬ Chicago, 111. [In addition, the company is offering warrants to purchase 6,347 common shares to holders of class A cap¬ ital stock, if converted to common shares on or before Dec. 31, 1958; and warrants to purchase 6,000 shares are being given to Central Illinois Securities Corp., which has subscribed to 25,000 of the units being offered. A total of 42,356 common shares are being offered to class A capital shareholders in exchange for said class A Offering—Expected Surrey Oil & Gas Corp., Dallas, Tex. 12 filed 300,000 shares of common stock (par $1). Price—$3 per share. Proceeds—To retire current liabil¬ 000.000 ities and for drilling and exploration costs and common capital. 1967, of and 5% the amendment). bentures are debentures due March 1, 1967 (the exchange offers are to be supplied by An additional $1,000,000 of the new de¬ to be offered to company employees at 95% of principal amount. offering price equal to The remaining $13,500,000 of debentures, plus any part of the $12,000,000 not taken pursuant to the exchange offers will be offered for public sale at 100% of prin¬ an working Underwriter—Peter Morgan & Co., New York. ★ Texas Power & Light Co. (12/16) 21 filed $12,500,000 of first mortgage bonds due 1988. Proceeds—Together with a cash contribution of $2,000,000 from its parent, Texas Utilities Co., and funds derived from operations, will be used to finance con¬ struction and to repay $4,000,000 of loans from the parent. Underwriter—To be determined by competitive bidding. Probable bidders: Halsey, Stuart & Co. Inc.; Kuhn, Loeb & Co., Blyth & Co., Inc., Kidder, Peabody Nov. Underwriter— Offering—Ex¬ South Africa (12/3) $25,000,000 of External Loan Bonds dated 1, 1958 and due in 1961,1962, 1963 and 1968; PriceTo be supplied by amendment. Proceeds—To meet the Union's capital requirements. Underwriter—Dillon, Read & Co. Inc., New York. . Nov. $8,of the debentures in exchange for outstanding shares and an additional $4,000,000 in exchange for outstanding 4%% convertible debentures due March notes. Dec. United Employee* Insurance-Co... April 16 filed. 2,000,000 shares of common stock (par $8). Price — $10 per share. Proceed* — For acquisition oi operating properties, real and/or personal, including 15,700 shares of common stock being offered for subscription by stockholders of record Nov. 17, at the rate of one share for each two shares held (with an oversubscription privilege); rights to expire on Dec. 15. Price — At par ($10 per share). Proceeds—To retire outstanding debts and for working capital. Office—Fifth Ave., Chardon, Ohio. Underwriter share for share basis.] short term and Nov. 10 filed Structural Fibers, Inc. Nov. 4 (letter of notification) a Union of ; t on loans Hough, Inc., St/Petersburg, Fla. pected this week. March 31 filed $2,000,000 of shares bank Beil & Strategic Minerals Corp. of America, Dallas, Tex common / A// . Union Finance Corp., Tampa, Fla. Sept. 26 filed $500,000 of 6% 20-year sinking fund con¬ vertible capital debentures due Oct. 15, 1978. Price — 100% and accrued interest. Proceeds—To be added to the general funds of the company and initially used to re¬ Life, Health & Accident Insurance Co. July 9 (letter of notification) 50,000 shares of common stock (par~$l). Price—$5 per share. Proceeds—To be invested in stocks and bonds and to acquire other life insurance companies. Address—P. O. Box 678, Gulfport, Miss. Underwriter—Gates, Carter & Co., Gulfport, Miss number of . Tungsten Mountain Mining Co. Aug. 11 (letter of notification) 100,000 shares of com¬ mon stock (par $1). Price—$1.50 per share. Proceeds— To extinguish present indebtedness, increase reserve for contingencies and working capital. Office—511 Securi¬ ties Bldg., Seattle 1, Wash. Underwriter—H. P. Pratt & Co., 807 Hoge Bldg., Seattle 4, Wash. State this week. Sheraton Corp. of America 1, Pany.] Arenas (Delaware) Inc. / shares of common stock (par one Price—At the market (but in no event less than $6 per share). Proceeds—To selling stockholders. Office —33 Great Neck Rd., Great Neck, N. Y. Underwriter— Oct. 24 filed $26,500,000 of 7V2% capital income sinking fund debentures. The company proposes to offer terms Corp., both of New York. [Registration also cov¬ 11,000 additional commonJ shares to be offered to regular full time employees, including officers of com- ers 18 filed 461,950 Oct. 28 filed 110,000 shares of and" 110,000 warrants, first per Boston Sports 'f filed 5 25, 1958; rights to expire on Dec. 15. Price share. Proceeds—To be added to general funds of the company and used for payment of promissory notes. Underwriters—Blyth & Co., Inc., and The First —$49 cent). ' Tucson record Nov. None. *• - Gas, Electric Light & Power Co. 110,000 shares of common stock (par $5) being offered for subscription by common stockholders at the rate of one new share for each 10 shares held of (Delaware) Inc. Nov. 18 filed $2,000,000 of 6% 10-year convertible de¬ bentures (subordinated), due Jan. 1, 1969. Price—To be supplied by amendment. Proceeds—$750,000 to pay AMF Pinspotters, Inc. for bowling alley beds; $350,000 to payy for other installations, fixtures and equipment; *$85,000 to expand two present establishments by increasing the number of alley beds by eight at.jYorktown Heights and by six at Wilton Manor Lanes', 'Fort Lauderdale; $300,000 for deposits on leaseholds, telephones and util¬ ities; and $395,000 for working capital. Underwriter— ' Andersen-Randolph Co., Inc., Salt Lake City, Utah. Nov. Arenas ;—None.-' wells and for general — Mart, Inc., Boulder, Colo. > Nov. 10 filed 500,000 shares of common stock (par $5). Price—$10 per share. Proeeeds—For working capital and construction program. Underwriter—Allen Investment Co., Boulder, Colo. Curtis, both of New York. Southwest Shares, Inc., Austin, Texas. new Underwriter Tower Merchandise for the payment of bank loans Underwriters—Stone & None. Proceeds—To drill two corporate purposes. in connection therewith. Sports .. . s cumulative preferred stock (par $50). Price—To be supplied by amendment. Pro¬ ceeds—Together with other funds, will be applied to the paymenf in part of obligations incurred or to be incurred in connection with the company's construction program Webster Securities Corp. and unit for Tip Top Oil & Gas Co., Salt Lake City, Utah ) April 15 filed 220,000 shares of common stock, of which 200,000 shares are to be publicly offered. Price—$5 per Nov. 10 filed 50,000 shares of made one — — up the basis of Timeplan Finance Corp. March 25 (letter of notification) 27,272 shares of 70-cent cumulative preferred stock (par $5) and 27,272 shares of common stock (par 10 cents) to be offered in units of one share to each class of stock.; Price—$11 per unlL Proceeds For working capitaL Office-;-111 E. Main. St., Morristown, Tenn. Underwriter—Valley Securities : Corp., Morristown, Tenn. ■ . . , Rocky Mountain Quarter Racing Oct. 31, 1957 (letter of notification) common stock. Price—At par ($1 per repay outstanding indebtedness. Colo, Underwriter—R. B. Ford Co., Memphis, Tenn. Telephone on (500 of the shares are being offered to the President oi the company). Price—• $60 per unit. Proceeds—For working capital. Office— 543 Whitehall St., S. W., Atlanta, Ga Underwriter— None. 14 filed Nov. Remo Bell (12/9) Nov. of Nov. - preferred stock. Price—$100 per unit. Proceeds—For acquisition of motels. Underwriter—Sire Plan Portfolios, Inc., New York. • shares of common stock (no par). Price—To be supplied by amendment. Proceeds — For Nov. stockholder? each two shares of stock owned 000 shares of 6% Canada. Dec. 16. on Thomas Paint Products Co. At par. Proceeds—For working capital. Office — 3172 North Sheridan Rd., Chicago 14, 111. Underwriter—None struction * Co., and Merrill Lynch, Pierce, Fenner & Smith (jointly); Eastman JDillon, Union Securities & Co. and Salomon Bros. & Hutzler (jointly); White, Weld & Co.; Lehman Brothers; Drexel & Co. and Hemphill, Noyes & Co. (jointly); The First Boston Corp. Bids—Expected curities Corp., Boston, Mass, on a best efforts basis. stockholders Thursday, November 27, 1958 & For general corporate pur¬ poses, including the financing of the cost of any acquisi¬ tions and new construction. Underwriter—Sheraton Se¬ tion by common Prairie Fibreboard Ltd. Aug. 18 filed 209,993 shares of common stock (par .o be offered for sale to residents of Canada in the • .,. (2236) office furniture, fixtures, equipment and office space, tease or by purchase. Office — Wilmington, Del. Under¬ Myrl L. McKee of Portland, Ore., ie writer—None President..,.. _ ' ._ . United Security Life & Accident Insurance Co. Aug. 22 filed 120,000 shares of class A common stock. Price—$3 per share. Proceeds—To provide the reserves required to be held in life and accident insurance poli¬ cies, and to pay the necessary expenses in producing insurance. Office—Louisville, Ky. Underwriter—None. Edmond M. Smith, is President. • United States Freight Co. (12/3) Nov. 13 filed 210,000 shares of be offered for subscription by capital stock (no par) to stockholders on or about Dec. 2, 1958, at the rate of one new share for each four shares held, rights to expire on Dec. 17. Price—To be supplied by amendment. Proceeds — Some $750,000 will be used to prepay conditional sales contracts for trailers, tractors and miscellaneous equipment previously acquired by the company for use in "piggyback" opera¬ tions, and approximately $1,750,000 will be applied to. additional "piggyback" equipment, the balance will be used for general corporate purposes, primarily as addi¬ tional working capital to finance expanded "piggyback" operations. Underwriter—Merrill Lynch, Pierce, Fenner & Smith, New York. if United States Glass & Chemical Corp. outstanding shares of common stock. market. Proceeds — To selling stockholders. Nov. 26 filed 708,750 Price—At Office—Tiffin, Ohio. Underwriter—None. U. S. 1 Polymeric Chemicals, Inc.* Oct. 22 stock (letter of notification) 26,285 shares of common (par 50 cents) being offered for subscription by the basis of four rights will expire on Nov. 24, 1958. Price—$11 per share. Proceeds—For equipment, bank loan and for working capital. Office— stockholders of record Nov. 3, 1958 on new shares for each 13 shares held; Volume 188 Number 5798 The Commercial and Financial Chronicle (2237) O. Box 546, Canal & Ludlow P. Universal • Sts., Stamford, Conn. Underwriter—Dominick & Dominick, New York; (by amendment) an additional $20,000,000 of Systematic Investing Programs With Insurance, Sys¬ tematic Savings Investing Programs Without Insurance and Single Payment Investing Programs. Proceeds— • For investment. Co. Uranium Corp. of America, Portland, Ore. April 30,1957 filed 1,250,000 shares of common stock (par Ifl cents). Price—To be sunDlied by amendment (ex¬ Portland, Ore., is 1,199,307 holders of record Nov. Pres¬ Utah Minerals Co. per Sc Co., Inc., share. 1, 1958, in the ratio of on that date. Proceeds—$300,000 will be one ance 26 1988. new filed Acme , in the business will be used to carry forward the con¬ struction program of the company and its subsidiaries amounting to approximately $43,000,000 for the period ,v in & Co., and on common Denmark Proceeds—For working capital. Under¬ writers—T. C. Henderson & Co., Inc., Des Moines, Iowa, and Quail & Co., Inc., Davenport, Iowa. share. Sept. 2 it 000 to was (Kingdom of) reported that $30,000,000 may market this year. New York. can ,. Vocaltne Co. of America* Inc. (12/2) Nov. 10 (letter of notification) 21,500 shares of common stock (par $1.50). Price—To be supplied by amendment (approximately $2.25 per share). Proceeds — To repay an issue of between $20,000- possibly be placed on the Ameri¬ Underwriter—Kuhn, Loeb & Co., company expects later in the year to issue and sell additional securities, prob-> loan; reduce accounts payable; acquire inventory and the balance for working capital. Under¬ of additional funds. writer—Paine, Webber, Jackson & Curtis, New York, from N. Y, bank loans and for construction program. Von's Grocery Co., Los Angeles, Calif. Nov.: 5 filed 360,000 shares of common stock. ably preferred stock, to secure approximately $5,000,000 Proceeds—Together with $7,000,000 private sale of Alk% bonds, to repay short-term Price—To be supplied by amendment. Proceeds—To selling stock¬ Underwriter—Hemphill, Noyes & Co., Los An¬ geles, Calif., and New York City. Y holders. of • West Ohio Gas Co. 10 shares then held; rights to expire on Jan. 9. share. Proceeds Price— For construction program. Office—319 West Market St., Lima, O. Underwriter— None. 1 ,l " :. — • , . • Wilier Color Television System, Inc. (11/28) April 2 (letter of notification) 72,035 shares ol commot stock (par $1) of which 10,000 are to be offered to stock¬ holders at $2 per share and the remaining 62,035 shares are to be publicly offered at $3 each. Proceeds — Foi general corporate purposes.. Office—151 Adell Avenue. Yonkers, N. Y. Underwriter Edwir Jefferson w Broadway, New York 6, N. Y. Statement effective Nov. 18. Wilmington Country Club, Wilmington, Del. 27 filed $500,000 of debentures due 1991 (non in¬ terest bearing) and 800 shares of common stock (par $25) to be offered to members of this club and of Concord Ltd. Price—$375 per common share and $1,000 per debenture. Proceeds — To develop property and Oct. build certain facilities. Underwriter—None. Wisconsin Public Service Corp. (12/3). Nov. 12 filed 50,000 shares of cumulative preferred stock (par $100). Price—To be supplied by amendment. Pro¬ ceeds—To repay short-term bank loans incurred for 1958 construction. Underwriters—The First Boston Corp., and Merrill Lynch, Pierce, Fenner & Smith, both of New York; Robert W. Baird & Co., Inc., Milwaukee, Wis.; and '^William Blair & Co., Chicago, 111. - ~ Jan. 10, 1959.Price—$40 per share. capital and surplus. Office—931 Main Street, Houston 1, Texas. Proceeds—To on increase First National Bank in Oct. 27 Dec. (12/8) Nov.. 17 filed 37,615 shares of common stock (par $5) to be offered for subscription by common stockholders of record Dec. 6,1958, at the rate of one new share for each per rights to expire basis of Nov. 12, 1958 $15 19 it was announced Bank plans to offer to its stockholders of record Oct. 2, 1958 the right to subscribe for 125,000 additional shares of capital stock (par $20) on the basis of one new share for each 10 shares held; stock the on as First City National Bank Sept. com¬ being offered for subscription by stockholders of one share for each eight shares held (with an oversubscription privilege) rights to expire on Dec. 12, 1958. Price—At par ($1 per share). Proceeds—For working capital. Office—Wal¬ tham, Mass. Underwriter—None. mon Underwriters —May be The First Boston Corp.; Kidder, Peabody & Co.; Merrill Lynch, Pierce, Fenner & Smith; and White, Weld & Co., all of New York. * (12/2) Waltham Precision Instrument Co., Inc. Oct. 24 (letter of notification) 300,000 shares Y — 2 it announced Dallas* Texas (12/2) stockholders will, vote ?on plan to offer 290,000 shares of (par $10) to stockholders of record Dec. 2, 1958 on a one-for-eight basis; rights to expire on Dec. 18. Price—$27 per share. Proceeds—To increase capital and surplus. Underwriters — Equitable was to approve additional common a stock Securities Corp., Dallas, Texas, and Merrill Pierce, Fenner & Smith, Fort Worth, Texas. Lynch, First National Bank of Jersey City (N. J.) 19 it was announced Bank is offering to its stock¬ holders of record Nov. 19, 1958 the right to subscribe on Nov. pro rata basis for an additional 17,000 shares of capital stock (par $25); rights will expire on Dec. 5. Price—$55 a share. Proceeds—To increase capital and surplus. Underwriters—Van Alstyne, Noel & Co., New York. per Giant Food Stores, Inc. Nov. 3 it reported that the company plans an offer¬ ing of common stock to holders of Giant Food Prop¬ was erties, Inc. Underwriters—May be Kidder, Peabody & Co., New York, and Auchincloss, Parker & Redpath, Washington, D. C. ' Great Atlantic & Pacific Tea Co.* Inc. Feb. 19 it was reported a secondary offering of common voting stock is expected this year. Underwriters — May include: Blyth & Co., Inc.; Lehman Brothers and Smith, Barney & Co. ~ an issue of between $30,000,000 soon be publicly offered ? may market. Proceeds—For public works Boston Corp., New ' : : ,;Yr: Yv Stone & Webster Securities Corp. (jointly); Glore* For-^ Co., and Goldman Sachs & Co. (jointly). 7 Power Feb. 14 it was sell $10,000,000 of ceeds—For ■, & Light Co. , announced company plans to issue and first mortgage bonds due 1988. Pro¬ construction program. Underwriter—T6 be competitive* bidding.! Probable biddefs;^ Halsey, Stuart & Co. Inc.; The' First Boston Corp.; Glore, Forgan & Co.: Harriman Ripley & Co. Inc.; White, Weld & Co.; Blyth & Co., Inc.; Equitable Securities Corp ^tprmir»od bv Laboratory for Electronics, Inc. July 3, Henry W. Harding, President, announced that the directors are currently considering refinancing $790,000 of outstanding notes ($658,750 held by a principal stockholder and $131,250 by a bank) on a more perma¬ nent basis. This may be done through vertible debenture financing. Office—75 equity or con¬ Pitts St., Bos¬ ton, Mass. . C ' Master Fund, Inc.* Fairfield, Calif. 7... f Jan. 27 it was announced this newly organized invest¬ California 10,00 shares of capital stock (par $1). Price —$10 per shar>, less an underwriting discount of 814%. Proceeds—For investment. Michigan Bell Telephone Co. Aug. 12 directors approved plans to sell $40,000,000 of 34-year debentures. Proceeds—To redeem a like amount of 4%% debentures due November, Underwriter /* bidding. Probable bidders: Halsey, Stuart & Co. Inc.; Morgan Stanley & Co. Bids—Had been tentatively scheduled to be re¬ ceived on Sept. 16, but on Aug. 26 it was voted to post¬ pone this refunding program because of present market —To be conditions. • Midland Enterprises, Inc. March 28, company announced it plans to issue on or?, before Dec. 31, 1958 $3,200,000 of first preferred mort¬ gage bonds. May be placed privately. Proceeds — To repay bank loans and for working capital. eral Power mortgage Commission bonds, for unsecured Broth¬ Merrill Lynch, Pierce, Fenner & Smith and White, permission notes and to issue common first stock. Proceeds—To build pipe line system to cost about $111,000,000. Underwriters — Stone & Webster Securities Corp. and White Weld & Co., both of New York. Moore-McCormack Lines, Inc. March 24 it was 1 announced company plans to issue and sell $24,000,000 of government insured bonds secured by a first preferred ship mortgage on the liners S. S. Brasil and S. S. Argentina. Underwriters—Kuhn, Loeb & Co. and Lehman Brothers, both of New York.' Offering:— Postponed because of uncertain market conditions. ; New York State Electric and Gas Co. March 7 it announced that approximately $7,500,000 financing will be required for construc¬ tion expenditures for the balance of this year. The man¬ agement intends to negotiate a new line of credit with a group of banks and expects to sell equity securities later this year or in early 1959, depending upon prevailing market conditions. Underwriter—For any common stock: The First Boston Corp., New York. was from additional Norfolk & Western Ry. Bids are (12/18) expected to be received by the company on Dec. 18 for the purchase from it of $5,850,000 equipment trust Salomon Bros. & Hutzler. 5 able bidders: Halsey, Stuart & Co. Inc.; Lehman 1 Midwestern Gas Transmission Co. * March 24 it was announced that this subsidiary of Tennessee Gas Transmission Co. has applied to the Fed* certificates. (1/19) plans to issue and sell $10,000,000 of first mortgage bonds. Proceeds—To repay bank loans and for construction program. Under¬ writer—To be determined by competitive bidding. Prob¬ announced company 1992. determined by competitive Nov. 21 it ers; * • 7 <A-Gulf States Utilities Co. was ' Expected ment company nlans to offer to bona fide residents of Equitable Gas Co. July 18 it was announced that the short term bank ■ • ., . Underwriter— Offering ' Kansas just prior to the offering date. Under¬ writers—May be Morgan Stanley & Co. and The First Boston Corp., both of New York. Price— stock. expansion. ' gan & Aug. 25 it was reported that the company may issue and sell $2§,p0Q,000 of preferred stock. Underwriters—May To be determined shall be designated by company. per plans addltional financing this year, in the form of common stock, preferred stock, or a combination of the two, including: bank loans. Proceeds—For expansion program, work¬ ing capital and inventories. Underwriters—Blyth & Co inc. and Merrill Lynch. Pierce, Fenner & Smith. Y!1 1 Evans, Chairman, announced that com- "* pany plans to sell some bonds originally scheduled for. mid-year. The proposed sale was subsequently deferred until late 1958 or early: 1959. Proceeds—About $8,000,000 for construction program. Under writer—To be determined by competitive bidding. Probable bidders: Halsey. Stuart & Co. Inc.; Kidder, Peabody & Co., and Merrill. Lynch, Pierce, Fenner & Smith (jointly); Lehman Brothers; Eastman Dillon, Union Securities & Co. and Co.: Nov. 2033, 2 Rector Street, New York, Y., up to noon (EDT) on Sept. 9, but were postponed Sept. 3. Pids will $ow be received on such day sub¬ sequent to Sept. 22, 1958 but not later than Nov. 25, 1958 $9.25 Proceeds—For the American York. announced that the company Corp. and Glore Forgan & Co., both Offering—Expected late in 1958 or during ,. Securities projects, etc. Underwriter—The First Under¬ A Consolidated Edison Co. of New York, Inc. 25 it was announced that the ccmpany plans to offer to its common stockholders $59,778,600 of converti¬ ble debentures in the latter part of January on the basis of $100 of debentures for each *25 shares owned. Price— to have been on <Ar Vernon Co., Newton, Iowa 25 filed 50,000 shares of was the first three months of 19597; Room Nov. Webster Japan (Empire of) Aug. 20 it was stated that and $50,000,000 of bonds be The Firfet Boston N. as Steel of New York. (jointly); Salomon Brothers & Hutzler; Kidder, Peabody Co.; Eastman Dillon,, Union Securities Smith, Barney & Co. (jointly). Bids—Were & sometime in November. Commonwealth Edison Co. 1958-1960. received announced shares Glore, Forgan & Co., New York. company; March 21 it $15,000,000 of first mort¬ gage bonds, 5Vi% series due 1987, to repay $4,000,000 of bank borrowings, and the balance together with further borrowings under a bank agreement and cash generated & was March 31, G. W. redeem Underwriter—To be determined by competi¬ bidding. Probable bidder?: Halsey, Stuart & Co. Inc.; First Boston Corp. and Blyth & Co./Inc.,(jointly); White, Weld & Co. and Stone & Webster Securities?Corp . Kansas Gas & Electric Co. Light Co. $20,000,000 of first mortgage bonds due tive it stockholders. Rochester, N. Y.; Proceeds—To re¬ ■ . Utah Power & June ... Heublein, Inc. 7 < , . k ■ Aug. 25 it was reported that the company plans early / registration of 400,000 shares of common stock; of which n 100,000 shares are to be sold for the account of selling ^ $500,000 for capitalization of a title insur¬ ance company; $500,000 for additional capital contribu¬ tion to Great Plains Development Co.; and $300,000 as an additional capital contribution to Great Plains Mort¬ .At par . Corp.; Kuhn, Loeb & Co. (jointly); Lehman Broth¬ ers and. Equitable Securities Corp. (jointly); Glore, For-! ; gan & Co. and W. C. Langley & Co. (jointly). Bids— Expected to be received on Jan. 13. Y 7 Price—$4 Co. Office—319 E. "A" St., Casper, Wyo. writer—None. 7." -7 7 '•••" 13 100.000 Stone used for payments gage Bids—Expected to be and Salomon Bros. & Hutzler contract to purchase shares of International Fidelity Insurance Co.; $325,000 for capitalization of a fire insur¬ ($1 per share). Proceeds — Foi development of oil and gas lands. Office—574 Jefferson ' Ave., Rochester 11, N. Y.-Underwriter—Frank P. Hunt —• Of these (jointly). company plans to issue and of cumulative preferred stock (par Proceeds—To repay bank loans and for construetion program." Underwriter—To be determined by competitive bidding. Probable bidders: Lee Hig&inson Corp.; on , Utah Oil Co. of New York, Inc. May 0 (letter of notification) 300,000 shares of capital Price stock. N Co. $100). are share for each 2.33 shares held stock Nov. sell ■* & Jan. 19. on * Gtrif States Utilities Co.: (1/13) (12/2) common Securities ceived subject to partially completed sub¬ scriptions at $2, $3.33 and $4 per share; and the addi¬ tional 250,000 shares are to be offered initially to share¬ ident April 11 (letter of notification) 900,000 shares of comnion stock. Price—At par, (10 cents per share). Proceeds —For mining expenses. Office—305 Main St, Park City, Utah. Underwriter—Walter Sondrup & Co., Salt Lak« City, Utah. ; - American Nov. 17 filed 1,449,307 shares of shares share). Proceeds—For exploration Underwriter—To be named by amendment of filed Wyoming Corp. per Griswold 28 depositary receipts for 212,158 shares of /£l par ordinary (common) stock; (together with a like number of the shares. Price—To be supplied by amendment. Proceeds—To selling stockholders. Un¬ derwriter—Blair & Co., Incorporated, New York. Office —Nassau, Bahamas. — Albert World Wide Helicopters Ltd. Oct. ★ Upjohn Co., Kalamazoo, Mich. (12/11) Nov. 21 filed 2,410,000 shhres of common stock (par $1). Price—To be supplied by amendment. Proceeds To selling stockholders. Underwriter—Morgan Stanley & Graham ... (par 10 cents); Prices—$2 per share. Proceeds—; For general corporate purposes. Office—44 W. 18th St., New York, N. Y. Underwriter—C. H. Abraham & Co., Inc., 565 Fifth Ave., New York 17, N. Y. • 7 Nov. 24 filed purposes. : (12/1) : ^»;' /eld & Co..(jointly); Stone & Websteii.Securities^Cprp.; nqtjtfichtiori)^& torpikoh' ; ahd Salomon Bibs." & Hutzler and Eastman Dillon, Uniori - stock Programs lnc., N«w York pected to be $1 Woolfoam Corp. Nov. 6 (letter- of :!■;;£* 45 Probable bidders: Halsey, Stuart & -f i Co. Inc.; i ic North American Van Lines, Inc.. Nov. 20, James D. Edgett, President, announced com¬ pany plans early in 1959 to make a public offering of its Confirmed on 47 46 The Commercial and Financial Chronicle (2238) employing as few as twenty-five or any number of employees can take advantage of the NBW GROUP INVESTMENT FUNDS, according Companies two, ten, Westchester Bank To Handle Small to the announcement. Business Fund businessmen Hundreds of small County will have of "Westchester available time them to The plan to be known first the for vehicle for providing pen¬ a profit-sharing benefits to sion and employees, according to an their Ralph from announcement T. sound Marshall, President, of National Westchester, White Plains. Bank; of lower benefits of liquidity greater inherent costs and in these profit-sharing Westchester Wo believe that firms have employees or for similar reasons. TEXAS GULFSOLPHORCOMPANY Westchester The Board rtf Directors lias declared this offer to ; ( impor¬ • ceive that stated "Any employee benefit plan which Department ap- dividends, payable December * to stockholders of record at close of business December 1,4958. 1958, - DIVIDEND E. F. , Broad Street, Board of November New 4, York of Directors N. this Y. KENNECOTT COPPER company 1958, declared the regular quarterly dividend of $1,375 per share on the outstanding WPin Series Cumulative • Preferred Stock of the company payable January 1, 1959, to. stockholders of record it the close of business on December 15, CORPORATION 161 East 42d Street, NewYork, N.Y. November 21, 1958 JOHN A. KENNEDY, At and Secretary. 116th Censec-df/ve meeting of the Board of the Directors of Kennecotf Dividend Copper Cor¬ Hie Board of Directors at poration held today, a cash dis¬ BRICCS & STRATTON tribution of ord of quarterly dividend" of seventy-five cents «per share ton the cipital stock, which will be payable December 11, 1958, to on 1958. December 2, THE today declared dividend of Fifty Cents ($.50) per share on its capital stock of the par value 24,1958. of $50 stockholders to of of close December 5, record declared declared has Directors of Board The a quarterly dividend of thirty-five cents (35c) v* v*.». — ' per share and a year-end dividend of forty cents (40c) per share on the capital stock (S3 par value) of the Corporation, payable December 15, 1958 to stockholders of record November 28, 1958. vjltvta kv1 ij at business of on 1958. , L. G. Secretary-Treasurer. REGNER, November (»l A of record shareholders the at cents holders close of business December 8, record of -close tbe at of of Directors Allegheny Ludlum 8teel Corporation held (25c) 1958. of November 20. of fifty today, a payable 1958, of December December 20, stockholders record at tfie clos6 of business on 5, Common Corporation, "the Common to de¬ was the on of Stock — share per clared _ 1958, cents dividend (50c) CORPORATION ': Treasurer ' 1958. S. Board of Directors of The Colorado Fuel Iron Corporation today declared the regu¬ quarterly dividend of 62!'2 cents per share series A $50 par value preferred stock, and 68:,4 cents per share on the series B $50 par value preferred stock. These dividends are payable December 31 to stockholders of record i,t the close of business December o, 1958. The Board of Directors took no action on the lar the common stock December 31, 1958. quarterly dividend the quarter ending on D. C. for RAHWAY, N. J. Ml Quarterly dividends E ferred of 35e share a on Corporation A have on regular close December pre¬ clared de¬ been par January 2, on business of on Con¬ the common share ♦he HOth Dividend A this DIVIDEND QUARTERLY declared been 1958, of ber 5, De¬ on close of business also been stockholders stock has December MR .CONTROLS 22, 1958, to stock¬ business on December A • cember 10,1958. WEST VIRGINIA - , has been declared Stock 5, on the Common A 1958 to cents the close of declared business December 10, at 1958. The transfer of this will not be closed. books was A. R. November BERGEN JAMES A. Win Secretary 25, 1958 November 19, 1958 Secretary Secretary. November 24, 1958. (50^) 22, record of ■ a per on (3%) issued slock. business 1958 to 15, on Robert g. Burns, Treasurer NOTICE , SERVING INDUSTRY HOME AND WITH ESSENTIAL BASIC PRODUCTS MCHENRY; Secretary ttnnessff co*pofl«tiom FLORIDA POWER & LIGHT COMPANY TENNESSEE YALE &TOWNE CORPORATION MIAMI, FLORIDA EASTERN ' ^ A GAS AND FUEL December <19, per share the .Common . .. November 18, 1958 . payable stockholders : on to : November 28,1958. X.H.rtTE DIVIDENDS Chemicals COMMON STOCK Common Stock The Directors of Diamond Alkali 1958 to shareholders Company have 3Vb$ Tecord tiess December 4, 1958. andoned»alf cents pet.dhore was declared by Ihe of record December 5,1958. * • declared dividend payable ers of a on Nov. 26, 1958 regular of 45 Dec. cents per 15, 1958 common to hold¬ - CARMICHAEL, Cleveland. Ohio share, capital stock of record Dec. 5, 1958. DONALD 8, quarterly - 4Vi% STOCK EXTRA CASH WVIPfWP ' An CUMULATIVE PREFERRED A tegular quarterly dividend payable of $1.12 January shareholders of share* a share 1959 1, record to Dec¬ of President hx. November 20,1938 < 61 4<| Our stock is listed on tb« New York Stock Etchmnge. Symbol is EFU. business 195$. 25t)StuartSt.,B6$ton 16, Mass. IUM0NI ALKALI COMPANY cents peri declared payable was ; r December amaitlmi lalk* iHmiUlIFIwwj HMr* I earnings, ■stodkholdersof record at the close of business December TQ/I958. 4,' Wa..R»ATHERS John G. Greenboxgh Broadway Treasurer. _ , - Vice-President oetf decretory [THE YAllS. TOWWEWG.CO Cash dtvidends^sid inn! Board of Directors out •payable on January 2,^959,to - >ew York4, N.Y. > ' of pvrt of to stock¬ holders of record at the close ' Secretary E. H. BIRD, dividend ~ January 9,- 1959, ember 5, 1958, Nov. <21, 19S8 extra twenty-five (25f) — SFiarfc of dhi*ly-«eve*t the close of. busi' at xi dividend No. 283 stockholders of to r On Hoy. 20,1958, payable December 18, 1958, A — DIVIDEND " Declares 283rd Dividend A dividend of fifty-five (55 6) cents per share was declared President regular quarterly dividend of 40 cents a share, payable December 28, Regular Quarterly CASH of record at the close of business Diamond on on Stock of the Company ASSOCIATES Dividend quarterly dividend of 41c has been declared of November 26,1958. C. HL DIVIDEND ^payable share¬ are of record at fclose holders 1958. on dividends December record on Decem¬ the Common Stock Company. Also declared stock dividend of Three per cent, Both of fifty share has heen a.viae«*t quarterly December payable stockholders Carl M. Anderson, DIVIDEND NOTICE regular quarterly dividend of 37He per share 1958. on CHARLESTON, of De- business COMMON STOCK holders of record at the close of • record .at the ^close of declared, payable on 1958 20, 1958. payable on 1958, to share¬ December 20, holders at the record of 1958, to stockholders of December 5, the payable Corporation, on stock common for the :fourth capital stock quarter of on outstanding payable i per today been declared cember 29, of SEVENTY CENTS per share has has (§) . a COMPAHY Preferred December to dividend of 20(£ DW1TED CARBON the $25.00 value 5^ per cent Stock, on „ metals, inc. (5c) J ; quarterly Cumulative 5, 1958. An extra of five cents .«:* Secretary <■ share has been de¬ per $3.50 cumulative stock, the share dividend D. W.JACK * • November 21, 1958 vertible DIVIDEND No. 96 ..V . dividend of $0.34375 1959, to stockholders of record at ; / , PREFERRED STOCK 87a share clared, payable rOMMERCiAL Solvents 1958.; Richmond, Va. gF the common stock the on A 2, T959 to stockholders of j , MERCK and machine and the Common Stock on Company, payable Janu¬ ROBEIITSHAW - FULTON CONTROLS COMPANY K American of the < Secretary. McGREW, share per todayT dividend of 44 cents December 2, MERCK & CO., INC. the JR. Secretary. a record at the close of business and McCASKEY, A. declared ary The on of Directors Board The . GKEENBTTtGil, G. JOHN - Dividend Notice meeting of ihe Board NOTICE DIVIDEND year-end dividend of twenty-five cents per share, was declared, payable December 19, 1958, to stock¬ holders of record at the rlo.se of business December 4, 1958. * ; Betsch, Pittsburgh, Penna. a COMPANY business December 4, 1958. COLORADO FUEL AND IRON per A B. M. November 21, At UTILITIES dividend of twenty-five share was declared, payable December 19, 1958, to stock¬ Secretary and Treasurer Allegheny Ludlum Steel Corporation ; 1958 quarterly (25c) payable December 29, 1958, to Broadway, New York 4, N. Y. THE York <», N. Y. New Broadway, November 19, thirty-five cents (35^) per share on the Common Stock, 1958 18, Senior Vice President of 1958. Wis. Milwaukee, Secretary and Treasurer pATrL E.Shroatm JESSUP, Secretary MIAMI COPPER COMPANY quarterly dividend a R. E. SCHNEIDER 25 B. Dividend The Board of Directors has DIVIDEND per PAUL York, N. Y. Notice a share, December 27, 1958, payable the New COMPANY ANACONDA has COMPANY iBricgs&Stratton) a stockholders of record November BOND AND SHAME NjvoidIht 26, I'J'tii The Hoard of Directors of a November 13, 1958, on declared rec¬ business of close the at meeting was December on 1958, to stockholders 22, ELECTRIC £1.00 per share payable declared, CORPORATION NO. 202 DIVIDEND , , 19, Vice-President AnacondA « NOTICES CITY INVESTING COMPANY The NOTICES DIVIDEND NOTICES 15, the 7 VANDERSTUCKEN, JR., r • Secretary. • NOTICES 1958. DIVIDEND a the outstanding and entitled to re- ital stock ' , on 10,020,000 shares of the Company's cap¬ . : tant service." ahare dividend of 25 cents per to be the first in proud are NOT4CES DIVIDEND of Now, however, they can do it and DIVIDEND 25 Treasury number hesitated to establish pension and only porations. announcement small the the despite be derived, to Thursday, November 27, 1558 benefit of larger cor¬ plans of because all the investment ad¬ trusteed plans, advantages many we funds. vantages available formerly has the FUNDS management, broad diversi¬ fication, on J. all many programs The enjoy group even obtain for their employee Harold Tyner, Jr., Chairman, and INVESTMENT FUNDS permit business to participate in the NBW can GROUP and the smallest firms and corporations to INVESTMENT GROUP will NBW as proval, ... hi every jeardinca 4299 Volume 188 'Number 5798 . .The Commercial and Financial Chronicle . 4 34 Continued from page 45 v % bonds due, 1960. blower & : ^ (2239) Underwriter — ( Weeks, New York. May be Horn-; 4$ preme Court (expected within two months)* To the Petroleum Research Fund of the / „ "" I i f (i Stock,' and has applied to the Interstate Commerce Com- / mission for* authority to do tions. so. Office Northern/Illinois June 10 it was omteimced; company wilL sell late this year $16,666.000 mortgage bonds but-on Sept. 12 it wfes Northern Iwwmo Co. of New York Nov. 8 it was announced company plans to offer to its tifceckhbldefs- the right to sid>sctibe„ for 290,400 shares of Oct. 27 it >of common shares will account per ing may struction be put off until June, 1959. to market Proceeds—For con¬ program/ Underwriter—May be determined by competitive bidding. Probable .bidders: White, Wold 6c Co. and Shields & Co. (jointly); Lehman Bros.; Merrill Lynch, Pierce, Fenner & Smith.; Oct 27. it-was reported that the company is planning t . Vita Food Products, Inc. Nov. 3 it was reported that the company plans to issue Proceeds 15^)00 shares of common stock. Proceeds •—-To Mother's Food Products, Inc.., Underwriter—Granbery, Maraohe & Co., New York. reported that an issue of common stock will £oon be offered to the/public, the proceeds of which may run between $50,000,090 and $60,600;080. Approval of the transaction rests with the New York State Su¬ was The is that the obligations previously incurred. • Universal Oil Products Co. Aug. 13 it some • country. in Virginian Ry. Aug; 26 the directors approved a proposal to exchange 2,795,500 shares of 6% cumulative preferred itock (par $10) for $32,148,250 new 6% subordinated income rank¬ ing fund debentures to mature Aug. 1,2008 on the buKa of $11.50 principal amount of debentures for each pre¬ ferred share. Offer began on Nov. 17 and will expire On Jan. 16. Dealer-Manager—Harriman Ripley & Co. Inc., New York, this year or in the first quarter of 1959, but, this financ- Dorp. - Demand is Sustained Equity Offerings major debt offering shapes Pacific Gas & Electric Co.'s Next week's equity offerings somewhat better-tone air taxT'sellr- first and refunding mortga g e include Desilu Production Inc's ing gets out ^ the way over the bonds Which are scheduled for 525^00 shares of common which next- few - weeks providing the bidding on Tuesday. The original are scheduled to reach the market basis^for/a little better sitiiation registration here covered $56 mil¬ on Tuesday. secondary, drfers -as, ^J •*iO" short term share. ibout $30,660,009 of common stock In the latter part of ^c,Co. and Shields & Co/ (jointly); Salomon Bros. & Hutzter,cKuhn, Loeb; & Co. and American Securities Corp.;(jointly);• Eastman Dillon, Union Securities & Co. and7 Merrill Lynch, Pierce, Fenner & Smith (jointly); Lehman" Brothers; Blyth ,& Co.> Inc.; The/ First Boston Corp. Bids Td fee received on Jan. 8. v -"W" As a first step In the pro¬ being negotiated between the cooperation with the two investment banking firms and a syndicate of commercial banks In the United States, Canada and the United Kingdaaa. The three Institutions which are to head this syndicate are The Chase Manhattan Bank, The First National CNy Bank of New York, and Bank of America Natkmal That & Savings Association. The Chase Manhattan Bunk wfil be the fiscal agent for the credit* The amount of the new financing involved is in the neighborhood of 000,600. The purpose is to restore government I minium which have been reduced by the repayment of excesstaa holders of record Dec, 31,1958 on the basis of three new shares for each share deceived by stockholders on Dec. Price—$1 market the year-end will. dev^op a^p&aches. . Post-Holiday Schedule r t the Thanksgiving holiday but Of1 the way, prospective bor¬ rower^-it "appears, will be in the market for around $146 million corporate hew issae markef of- new debt capital lb the week kqntinuer to limp along M" search ahead. In addition, several rather jdf a' base that will tend to bring substantial equity operations are The up as lion, but the company is reported amendment to raise this to $65 million, preparing an Wednesday , brings up stock 700,660 The; Seasoned bohd . Also ting anywhere «o far on tap for Wednesday is Inc., which has revealed plans to issue of $27.5 raise $60 million through the sale . 147FN And new /been rather meeting ;> • Within the erratic i past re-: xt-'-'f y YY; week - or, of debentures for each 25 shares held. NOTICES quarterly dividend of $6.60; declared the on Common Stock of C* L T, Fifiancsm. Corporation, payable Jams* ary 1» 1659, to stockhoidos of record at the dose of buiioesi issues, accordingly/ have •.epphse."'1- for $160 per share in cash has been get; December 10,1958. The trans¬ FINANCIAL fer books will not dose. Checks CORPOHATIOM will be mailed. ten C. days two issues recently ;hrotight f to market have been turned loose John Kuhn, Treasurer November 26,195S. ito seek their own level after hayr. ing. proved a bit .on the; slo^y side ?in moving out ait the issue priced In neither case: did the issue in !tquesttoit suffer tion. V severe reacj- .:., Rather shade any the tendency was tiie initial offering - to Cities Service <juota- /jfion; . That was what, happened, ip ''both.the Columbia Gas and pugi^; i COMPANY jSoiind Power and light offerings (where the syndicates were dis;fcahded. Meantime, Pacific Tele-, Dividend Votive - . phone. , _ .. Telegraph Co.fs $86 jtnillion lssue of 82-year, * '4%-% jdebentures continued iside. •- on the^ slbw '• The Board of XKreefanrsef Cities Serviee Company has de¬ clared amuaritriy dfeMsod of ahcty eeata on RS Common stash, payable ;, 4968. taoddltioik, the ym&^^%,/gre; conmumdh^/oYrtight • 22,1969, to ShMehflders of ($J0) per abare December 15,1668,to abase* December 1, holders of record ad the close of bastaeae /But Northern Natural -Gas? Cd/ji" i$3<^ mtltion: of 4%^ rttebenfures, f- 1; / ; Shareholders cauld subscribe A (prospective buyers is concerned, i of convertible debentures late &i January*;v DIVIDEND impressing as financing Arvida Corp. market hai been piddling along without, sion of the list of new the On the following day Potomac Power Co. is slated to iQuite to the contrary, their-chief hope i now is that jportfolio man¬ agers for major institutional in¬ vestors will not shut up shop too early for year-end adjustment. i fest Itself in the constant expan¬ open bids for $25 million of its bonds. Wednesday also brings UP / common weeks of *• 19581 remaining tal, via both the debt and equity security routes, continues tb mani¬ Electric of E*hose seeking^ to;, borrow capital j -the Corporate demand for new capi¬ of the prospects. Public Service Electric & Gas Co., Latest to join the ranks is Con¬ plus $5 million of preferred stock solidated Edison CO* Of New Yoik of Wisconsin Public Service Corp. shares public, offering of $25 million Re¬ million of class A common, General Acceptance Corp. has a public of Austria bonds, and a like amount of Union of South Africa 366,000 share preferred offering in on tap, provided nothing happens bonds, wh i 1 e Jloiitana-Dakota being, with the actual offering id those having funds available to luing about a change in present Utilities Co. has $10 million bonds likely to be made during the ore nearly in accord.* ' \ coining week. lip for bids. : : r; /! plans. ; But, noting, the season of the DIVIDEND DIVIDCND NOTICE! year, experienced observers are not inclined to anticipate much in the • way of improvement through ; - - Kuhn, Loefe fti Kidder, Peabody& Co., both of New York, hapa develop a financial government + Trout Mining Co. UnionOeetric Co., St. Louis, Mo. March 28 it was announced company plans Co., Inc., both of Los gram a short-term credit is was announced by this newly organized sub¬ sidiary of American Machine & Metals, Inc., that it will shortly file a registration statement covering a rights offering (with an oversubscription privilege) to stock¬ 5. Blyth & , program for the Ftoceeds—To Nov. 25 it . The: hope currently Co. and derwriter—Blyth & Co., Inc., New York and San Fran¬ cisco, Calif. ^ $an bitft gas & Electric Co. (1/8) Nov. 12 it ;was reported that the company plans to issue and sell $15^000.000 of debentures. Proceeds—To repay bank borrowings incurred for capital expenditures. Unlerwriter^-fTo be1 determined by competitive bidding. Probablebidders: Halsey. Stuart & Co. Inc.; White, Weld and been selected as financial advisors to an of Company. Co. (Government of) July 1 the Government announced that ' share for each 35 shares hedd; rights Oh Pec. 1,. 1958. Price—$60 per share. Pro¬ ceeds—To increase capital and surplus. ^ f be for & Venezuela equipment purchase obligations and for general Corporate purposes. Business—Trucking concern. Un¬ tiew ir*-."* (12/2) • reported that an Angeles, Calif. retire Republic National Bank of Dallas, Tex. Nov; 14 Bank offered t!5,170 additional shares! of capital stock (par $12) to its stockholders of record. Nov. 14, , R.Staats -' ■ • ■ " offering of 260,000 shares stock (par $2) is planned, Of which 125,000 was . longfterm financing. Proceeds. : To. replace an interim Jk>an obtained in connection with^he purchase : (of propertied from; Gulf States Land* Industries, and I to retire / approximately* $1,200,000 of first mortgage stockholders were given the riCI la additional 101,933 shares nf mm—m (par $5) at the rate of one new share Mr each 85 shares held of record Oct. 30, 1958; rights to expire on Nov. 21. Price—$35 per share. Underwrites*—William common stock T. |. M.E. Inc. capital stock (par <$12.50) -oh the basis of one new share*1 lOr each" tvwj j^aTes held'"(follchving 100% stock dis¬ tribution) Stockholders will yote Dec. 10 on both pro¬ posals; Subscription .warrants are" expected to be issued late in December or early in January. Underwriter-— JVlay.be The First Boston Corp., New York. South Coast Valley National Bank, Phoonix. Ariz* Oct. 31 subscribe for 35-year debentures.. Proceeds —- To refund outstanding $100,000,000 4^4% debentures. Underwriter—To be de¬ termined ' by competitive bidding. Probable bidders; Halsey, Stuart & Co. Inc.; Morgan Stanley & Co. Of¬ fering—Has been postponed. Bids1 had been expected about Sept. 30, 1958. Bostqn Corp.; Gkme, Forgan & Co,; Blyth & Co., Inc. < Expected in November. Ave., N. E., Atlanta, Ga. Bell Telephone Co. July 10 it was announced Missouri Public Service Com¬ mission authorized the company to issue $110,080,600 of financing willnotbenecessary. UMeiwi§tei-Tofeedetermined bycorapetitivebidding. •' - Southwestern Stated that-immediate J958, one to expire 197 Auburn — Underwriters—Expected tabeLefcBrothers, Smith, Barney &Co. and Merrfll Lynch. Pierce, Fenner & Smith, all of New York. Offering— man Underwriter;—None. I! Probable bidders: HMsey; Stuart j& Co; Inc.; First Chemical Society. Southeastern Fidelity Fire Insurant# Co. Aug, 26 it was announced that the company in all prob¬ ability will offor additional common stock to its shareholders in the* near future, : Proceeds—To expand Opera¬ ! Board deflated-a ataeh dlvkhodef t% en the presently eotatanding shares, payable January wmd fluml er t» 1959, Stet.(teisnAN>Mtary The Commercial and Financial 27,1958 Chronicle.,. Thursday* November (2240) ^ BUSINESS on Behind-the-Scens InterprsUtions hm lb* Nation's WASHINGTON, D. C. ; a have had in a their hands. The members debted to some Bureau of the seek "any facility used or Act that would grant ex¬ emption to two or more com¬ panies to jointly undertake •hydro or atomic energy projects and would require Federal readily apparent why the It is private utility companies are so apprehensive over the TVA proposal with all of On the other bond issue its ramifications. it has ; got, but no more. than they have had in .years are those that would au¬ thorize the Tennessee Valley Authority to issue and sell hundreds of millions of dollars 'in revenue bonds in financing Fast Growing Region Southwesterly di¬ Knoxville and through rection Guntersville, Ala., Decatur, Ala., and on to to Chattanooga the Columbia proponents of are working toward creating a big corpora¬ tion that would be somewhat similar to TVA iri the Columbia Federal suburban Knoxville. in It flows in a expanding its power pro¬ gram, and the proposed Federal is; River Tennessee The formed Shoals Muscle the area of other and Sheffield Florence, power communities before it for its confluence with the Ohio River at Paducah, Alabama -Kiver Basin. Ky. unlikely that Con"gress will require the Rural Electric Administration (REA) length is 652 river's miles. It appears The approximately 41,000 Vir¬ ginia, North Carolina, Georgia, shed is miles lying bigger Reclamation Bureau con- * etruction funds as a result of * North pay the election results in the Mountain Coast states. trie blue companies participating in than a score of develop- Southwest Virginia, 135 ». .. 500 feet moun¬ is concentrated of area west Alabama. * ■ in the North¬ > ' study, subsequent a whole Many industries have lo¬ cated within the region because try. cheap electricity which been subsidized. - ~ of TVA's The - Tax from other Federal has • well as and $37,776,997 was from *2 IN 25 years of its ; operations, bringing the total payments to the Treasury to $277,908,515. The net amount of funds avail¬ $1,270,000,000. Taxes and inter¬ were $347,000,000 and $284,000,000, respectively, below the that amounts have would Treasury TVA and should its electric power Besides required to pay be way, ; velt, five weeks after taking of- ~ in the 1933 depression, to Con ¬ gress proposing a TVA author¬ ity be created. In his message a ful here we are we by step, in a like development of other great natural territorial units within weeks later our borders." Five A TVA became law. Sprawling Giant About a year ago showed that more the records than $3,500,- had been expended by TVA in its development and operations. Congressional ap¬ 000,000 present an the magni¬ Valley Authority which wants to ex¬ pand, and will expand at a marked clip if Congress gives it a signal to go ahead/ tude sale was of carried value of and bonds on $45,203,448 the books as the properties transferred figures picture of of the Tennessee [This column is intended to re¬ flect the "behind the scene" inter¬ pretation from the nation's Capital and may or may not coincide with the "Chronicle's" own views.] Joins Central States A in has customer fair sized profit a loss to know to sell. The security and is at a a whether Call to sell or is contract a sells his not often used In follows: the matt very situation such as immediately long stock and purchases a Call. If the stock should advance, he knows that through the terms of his Call contract he can "recapture" the stock which he sold. on the other hand the stock de¬ If clines he buy back at a lower price can It is interest¬ the stock which he sold. first procedure ing to notice that the the long stock and using the contract-to repurchase, releases of selling Call the cash that was used in purchase and makes a like purchase Ask or Booklet for Use the original it available for another one. on How to Options Rlec Schmidt* Co. *Em»E«S PUT a CAU $2,000,000,000. In addition, $65,- 072,500 had been raised by the electric of TO RECAPTURE to / These overall v > for the production area power. success-, CALLS USED gross amounted transmission and march on, step can amounts, roughly 28% of the gross rev¬ enue, leaving more than $1,009,009,000 expended in the service message he said that "if these proceeds power President Franklin D. Roose¬ fice totaled sources receipts from the sale of power amounting to $1,474,375,192 were available to TVA. Net can including all ap¬ plicable taxes and interest. own OPTIONS from expenditure thus A SERIES ON THE USE OF $1,763,592,027. ac¬ private enterprise operation. The report concluded that for able under crued : program. power Chamber of Commerce said the est 4,11L (paper). $175,059,019 of invested in the An additional derived by TVA other sources during the Treasury . Tripp — Economic Studies, 200 South monies derived from the other the as D. Line Michigan Avenue, Chicago The funded debt had been re¬ paid, Capitals the History of on Chester Trend MOKtK A OtAlMS ASSN. INC. - (Special to The Financial Chronicle) MANSFIELD, Ohio —Ralph G. has joined the staff of Central States Investment Co., 120 BA 7-0101 roadway, NJY. 5 Cornell Walpark Building. We have prepared a Report comparing and evaluating Status United , agencies, propriations had totaled nearly region has blos¬ somed into one of the great recreational areas of the coun¬ This . . Northern feet,- of which about Shoals Muscle put the Federal Government directly intp the nuclear energy * , _ In TVA to and Western and Carolina about * projects. They are putting > many, many millions of dollars ; in those projects. Nevertheless. * there is going to be a bloc in Congress, although in the mi¬ nority, that will make a con--, certed effort that will seek to •/ of the Georgia. The fall of the river from Knoxville to Paducah is merit program. Ken¬ tainous area of East Tennessee, elec- * more The headwaters waters are in the tucky. - There are more than 100 in Tennessee, Alabama, Mississippi and Rocky * Pacific and River water¬ Tennessee its own way in the money market. The Federal Government, of course, has been subsidizing REA loans ever since » the agency was created, and it looks as though this will con- „ tinue. Perhaps there will be « to Notes thereby pro¬ vide a basis for passing on to the Federal taxpayer, who is supporting navigation and flood control, unjustifiably high costs for these adjunct functions of river development." production, addressed The 15 East 26th Street, N. Y. (cloth), $25. Company, New York 10, North heads , Insti¬ New '♦ ' Electric 750 Third Avenue, 17, N. Y. (paper). Montgomery's Federal Taxes, 37th Edition — The Ronald Press of those Washington conferences." taxpayers' and power project for Kiver Basin. The "He's going to one investment in TVA to June, 1952 had increased to passage . tute, records showed in 1954 that the what keep TVA let to brighter chance of a willing hand, the companies are proposals other hand, Soviet of publics—Edison York in the Socialist Re¬ Business Power Union replace¬ actions." to ,XVA May Expand On the Electric plant or other to be used for generation or transmission of electric power, or in connec¬ tion with lease-purchase trans¬ reservoirs. that have — Baltimore 18, Md., $5.00. the pay upstream for of ment pany benefits Indebtedness—Dragoslav Avramovic Johns Hopkins Press, enlarge¬ acquisition, struction, ment, improvement, or are in Growth war further ex¬ to & Post¬ International Servicing Capacity Debt pand their territory, if Congress permits the huge bond issue. Under the bills that have been before Congress the last two sessions, the proceeds from the bonds may be used for con¬ proposals that ■would amend the Holding Com¬ for will TVA mittees. projects area vigorously opposed to the expansion pro¬ gram on the ground that the climate, as it now exists, has obviously weak¬ ened some proposals that electric utilities would like, to sec passed, and has strength¬ ened some measures that they would like to see die in com¬ hydroelectric — adjacent to TVA are political Weakened the ; Englewood Cliffs, N. J., $39.95 per set. ; '*' ' ■ ?.■; «•/ in ; Treasurer's and Con¬ troller's Encyclopedia—In four Volumes Prentice-Hall, Inc., Corporate recommended budget utilities Private all House members. The "v 17, York $10.00. several last the messages. plus scores of new Democrats, in it Ad¬ 44th N. Y., East 155 Inc., New Street, Budget, and Presi¬ Eisenhower dent of 1946-1958— National of Association vertisers, the board, TVA The years. > "Why? Because labor opened its big purses this year and handed out a tremendous amount of money. Today labor is claiming credit for helping to elect 12 brand new senators, Congress fore are in¬ extent to labor. who > Rate- Trends Newspapers, Daily permit TVA to facilities by bonds was be¬ the past four Legislation to Congress will have new many growing populations. sale of revenue Brochure — i and Circulation finance new power ; (paper), R. I. needs increase the power cause with Business in prepared to assist high school guidance counsellors and stu¬ dents—Bryant College, Admin¬ istration Office, Providence, electric current, be¬ needs more a legislative body is unpredictable for the most part, but on paper the electric util¬ ities are going to have a battle Of course, on Careers nearly 5,500,000 Like the rest of the nation it is growing. There is no question that the area Here live. people Congress than they number of years. 86th the X f/M' of about 80,000 square area an miles. electric utilities may little tougher sledding in Nation's have >| m xJL I Ml' Capitol The — ... States Chamber ■ Studebaker-Packanl study of the published in Analysis of the Real TVA Power." At the of Commerce in a TVA financial data The TVA Program 1948 "An Of all the measures affecting Cost of the field of electric utilities in time the the next Congress . . that . . has a favorable chance of passage, as it now stands, is the TVA pro¬ posal. It is going to take a lot of work by the private companies: to keep this measure from be— coming law. It is not going to be easy. . 'Tennessee Valley Authority, created by Congress in 1933, is the sole supplier of power for show purported the to June, 1946, had amounted to $742,000,000, and that taxes and interest totaling $234,000,000 had been "lost" through TVA business operations.A sum¬ mary of the major conclusions of the 1948 report said • ^ Botany to investment report that "Seemingly^ every 'available been used to mini¬ device has mize the reported cost of power Carl Marks & P.O. Inc. FOHEIGN SECURITIES SPECIALISTS 1 - 20 BROAD STREET TEL: HANOVER 2-0050 • NEW YORK 5, N. T. : : - : TELETYPE NY 1-871 Copies on requeet LEANER! 00. Investment Securities 11 Post Offioa Mnara, Telephone HUbWd 2-iMO ; , Boston 8, Mass. . Teletype BS <0