Full text of Commercial and Financial Chronicle : November 8, 1951, Vol. 174, No. 5062

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£
U

national

NIVERSfTY

foreign trade convention featured

OF MICH.GAN

NOV S

1951

MSINESt WMWtTUIlM

™

UBMIf

Reg. U. s

Volume 174

Number 5062

New York, N.

Pat. o'ftc*

Y., Thursday, November 8, 1951

Price 40 Cents

Copy

a

EDITORIAL

Private

Is
It is
aware

li

See It

e

indifferent to the real

or

un¬

Foreign Trade Convention lists aims and methods which
vate

international economic endeavor and task of increasing

be

will

be

as

committee is

His objective is—to

serve

never

Before adjourning

„r

Oct. 31, the 38th National For¬

on

eign Trade Convention, sponsored by the National For¬

eign Trade Council and which

employ—to subject the Federal Re¬

System directly to the politicians.

held at the Waldorf-

was

Astoria Hotel in New York City, adopted

Those

pointed for that

the

members

are familiar with the
subject and who know
predilections of Mr. Patman, easily recognize

extensive

evidence

of

this

intention

session

the

in

vestigation

of 'this

whole

area

,;another subcommittee of this
the Economic

Report.

made

same

was

—

MORE

Corp.,

time:

Balgooyen is
of

has

&

adopted
made

by

public

the
on

Foreign

on

Foreign

National

Sept. 26, 1951.*

Economic

Trade

Continued
title, "A Statement

on

on

H. W.

TRADE

FOREIGN

dresses made at the

score

any

have

of

found

any

complicate

I must confess

no

ideal

practical

you

the

by

of official

multitude of
solution

investors

have I discov¬

nor

original principles to fur¬
a

that al-

problem

ready has been thoroughly obfuscated
Despite

Balgooyen

of the

some

nonsense

that

subject, there is nothing at all complicated or abstruse
in the process of reasoning that leads a prospective

24

Continued

Foreign Economic

ment.—Editor.

a

a great

has been written and spoken on this

Policy by the National Foreign Trade Council," and the paragraphsin italics contained in this article are quotations from
the state¬

28

en¬

for

by the theorists.

and

page

our

threadbare

worn

/

'

over-

of

proper

climate

or

ther

[

Policy

It holds the issues set

V '
♦The statement bears the

I

that

;

~

most

a

unofficial "experts."

v

Council

to have had

topics

subject of

been

that

Thirty-Eighth National Foreign Trade Convention
Statement

the

ered

The

;; ;

—

the

economic

have overlooked;

the Final Declaration follows:

the

of

one

committees, and

member.

text of

endorses

misfortune

probing minds of

Foreign Trade Council, Inc., also participated as an ex-

Smith

enterprises;

new

private
foreign
investment.
I
am
quite
certain
that
none
of
you
expect
to hear anything new, or startling,
or
profound on this subject, which

Secre¬

American

or

vironment

Vice-.

Balgooyen,

W.
Mr.

—

session

understood

New

The

prior

on page

least

this

National Foreign

Director

and

officio

is obviously

Continued

>

and

for

"

;

'

me

of the National
w.

Edgar

something less than convincing. One would sup¬
pose that the broad underlying principles which
govern, or should govern, Treasury-Federal Re¬
serve relationships change with the changing tide
■}•./.

studied

to

Foreign Power Co., Inc., New York
City. William S. Swingle, President

Further information about

conducted and the report written

Director,

Henry

tary

on

It has been my fortune

assigned

Council, Inc., New York City;

Chairman.

general and about the views of
leading economists and many others in the coun¬
try can scarcely be expected from another thresh¬
ing of the same old straw now. The excuse given
for another lengthy investigation—that the older
•one

-

W.

-

City; Secretary, P. T. Hitchens,

and

these matters in

|to the outbreak in Korea in 1950

this

at

Edgar

Motors ' Overseas

Trade

by

Committee

Chairman

were

Research

extensive in¬

was

Committee

York

couple

a

The three

purpose.

the

of

eral

representative elements in the population, but the
matriculate hardly need such evidence.

only

Final Decla¬

Smith, who is Vice-President of Gen¬

^questions i which have of late been addressed to

I
It is well known, of course, that
iof years ago a most intensive and

a

ration drawn up by a Committee ap¬

who

;the

(1)
(2)
chance togrow and earn a
profit commensurate with risks;
(3) security in possession of property and relief from haz¬
ard of adverse governmental
action; and, finally, freedom
to reinvest and to remit
earnings. Says U. S. loans abroad
should supplement but not
replace private investment.
opportunities for establishment of

use

.

for favorable environment for investment abroad:

Federal Government of this principle. '

plain, blunt language which the chairman himself
would

of using private capital in
foreign investment, and after criticizing government aid
to nations that have discriminated
against and confiicated foreign capital, Mr.
Balgooyen lists as requisites

can be discharged fully and effectively only
by private industry.: Asks for forthright declaration by

to what the chairman of this sub¬

aiming at.

After ^citing*; advantages

*
*

production

remains,

for the future to disclose, but let there

doubt

no

and credit: What the general drift

of these sessions

outcome

New York

policy. Holds pri¬
enterprise should play principal part in all fields of

ment of money

and

Secretary, American & Foreign Power Co., Inc.,''

should guide U. S. foreign economic

study matters which have to do with the manage¬

of course,

By HENRY W. BALGOOYEN*

Final Declaration drawn up by committee of National

meaning and

of the forthcoming Patman hearings to

purpose

Environment Needed to

To

important that the public not remain
of

Enterprise the Key

on

page

29

♦An address

by Mr. Balgooyen at Third General Session of 38th
National Foreign Trade Convention, New York City, Oct.
30, 1951.

ADDRESSES—Elsewhere in today's issue appear other
National Foreign Trade Convention in New York City.

ad¬

DEALERS

State and

in

U. S. Government,
Stale and

Municipal

Securities

R. H. Johnson & Co.

STATE

Established 1927
telephone:

Municipal

MUNICIPAL

600 Branches
across

BONDS

HAnover 2-3700
INVESTMENT

AND

Monthly Commercial Letter

SECURITIES

upon request

Chemical
BANK & TRUST

64 Wall

Street, New York 5

BOSTON

COMPANY

Troy
bond department

,

Buffalo

Albany

THE NATIONAL CITY BANK

The Canadian Bank

OF NEW YORK

Harrisburg
'

"

Williamsport

Washington, D. C.

Allentown

of Commerce

^

r

Scranton

Wilkes-Barre

Head Office:

Bond Dept.

Teletype: NY 1-708

Neic York
Seattle

Canadian

Pacific Coast &

Massachusetts

Hawaiian Securities

Prospectus from authorized dealers

or

VANCE, SANDERS & CO.
Ill

Devonshire Street

New York

Chicago
Los

Angeles




Private

Direct

y

NATIONAL bank
OF

BONDS & STOCKS

Central Vermont
Public Service Co.
COMMON

sold

N. Y.

•

Boston

Exchanges

Los Angeles
•

Honolulu

•

DEPARTMENT

CANADIAN

GOODBODY

&

CO.

established 1891

Principal Commodity

Security

San Francisco

Co.

&

Wall Street, New York,

Members of

THE ClUf OF NEW Y©«tK

Agency: 20 Exchange PI.

Portland, Ore. San Francisco Los Angeles

Wirea '

Dean Witter
14

Department

THE CHASE

Quoted

and

BOSTON

Bought

.

.

Toronto

CANADIAN

A

Stocks
and Bonds

\nvestors Trust

Bond

PHILADELPHIA

Providence

30 BROAD ST., N. Y.

Canada

members new york stock exch.

Chicago

115

broadway

new york

'

Analytit

Pomdhoh Securities
6rpora3io?s
40 Exchange Place,

New York 5, N. Y.

105 w. adams ST.

!

Chicago :

WHitehall 4-8181

request

IRA HAUPT & CO.
York Stock Exchange
Principal Exchanges

Members New
and

other

111

Broadway, N. Y. 6

WOrth 4-6000

Teletype NY 1-702-3

upon

Boston

Teletype NY 1-2708

Telephone:

Enterprise

1820

1

2

Chronicle

The Commercial and Financial

.

.

Thursday, November 8, 1951

.

(1742)

r/

TRADING MARKETS

The Security

IN

Pfds.

Conv.

&

Rights

Edison

are

New

York 5

selects

investor

W.

Ludwigsen,

•

an

his

cell & Co., N.

Y. City. (Page 2)

Bought—Sold—Quoted

Steiner, Rouse &

is

implies

name

Rights & Scrip

—an

equity

"grow,"
crease

or

in¬

in val¬

aircraft

standards.

charac-

a

^oarisons'

Mobile, Ala.
Direct wires to our

is

There

tfon asCof DeT31g1950arMain^Item ficient similarity among banking

of

The

flflC pONNELL & CO.
120

Stock Exchange

York

New

York

Exchange

Curb

as

2-7815

REctor

bona-fide

growth stock

BROADWAY, NEW YORK 5
Tel.

ef ore,

equities that
are qualified

Members
New

r

time.

become

a

fa¬

vorite such as
W.

C.

Phillips Petro¬

Ludwigsen

leum.

THERMO KING RY.
^ntii'ri^n^emenfin6 V?r ifait book v^ue of market price, ratio
al?
lmpiovement ln vlrtually of capital to deposits, classification

This large,

Net

With the enormous development

capital

Long-term debt

44,550,509
43,833,210
*$25.88

93,689,850
75,817,693
°$37.70

_

Book value per share

fi

completely integrated

Bassett Furniture Industries

Camp Manufacturing
Commonwealth Natural Gas
Dan River Mills

Life Insurance Co. of Va.

STRADER,TAYLOR & CO., Inc.

„,

_

■

,

„

Adjusted for 2-or-i sp

.

pr

n

1ftC1

.,

A

,

,

TWX LY 77

'

in

factor

nant

is also the domi¬
natural gas and

MIDWEST STOCK EXCHANGE

acres

of which 841,451 acres were

producing.
The company holds
foreign leases totaling in excess

Stix & Co,

compared

$4.32

with

advicahlp

to

stock,rights.

a

Bank

included

Cleveland, O.

reveal

to

of Boston

the geograph¬

earlier output and may close¬
ly approximate or exceed the 1948
peak when output of crude to¬

mate

year
Active

Trading Markets
in

'

taled 39.9 million

'

official

While

West Coast Securities
California

Oregon

serves

Water

Service

a

of

re¬

proven

than 35 years'
supply at the 1950 rate of with¬

INCORPORATED

1900 Russ Bldg,, San
Tel. EXbrook 2-7900

to

Francisco 4
Tele. SF 370

ACTIVE TRADING MARKETS IN

UTILITY STOCKS
Direct

Private
to

New

Telephone

be

valued at the current

would
a

cubic feet:
equal $375 million or $27
per

1,000

Combined total of $89 a

share.

CAnal 6-1613

The
recent

use

J. b. Maguire & Co., Inc.
Nat'l Assn. of Securities

Dealers Inc.

31 Milk St., Boston 9, Mass.
Tel. HUbbard 2-5500

•

Portland, Me.
Hartford, Conn.

Tele. BS 142

Enterprise 2904
Enterprise 6800

Open End Phone to New York Canal 6-1613




of carbon black

years

Demand
Members

cause

such

as

an

disparity
specific

for

has
both

risen

during

Members

Tel.

While

belong

m

bank

compensation. '

stocks

technically

the category of equities,

the

better

grade

Specializing in

bonds

and

high

grade

Mountain Fuel Supply

Equity Oil

First

The "Phil-

upon

request

EDWARD L. BURTON
& COMPANY
Established 1899

Salt Lake City 1

160 S. Main St.

Bell

Teletype SU 464

Oldest Investment House in Utah

Boston

of

largest and
banks in the
name

was

BUY

banks

is the

of

its total

u. s.

savings

among tne

the

United

bonds

largest commer-

National has six

Lirin

branches

Rr^n

onH

N. Q. B.

•

{"Si

Th.
The

transactions.
ment,

under

the

OVER-THE-COUNTER

tr,,®? S
trust
depart¬
name

of

Old

Operating and accounting

payment, and stability in market

Continued
Pre-Rights
High

on

Rights
Per'od

page

21

Sept.
1951

Low

Price

of N. Y.— 48%

41%

47%

Pennsylvania Co. for Banking & Trusts, Phila. 37 %
National City Bank of Cleveland—
39,

33 %
35

36%
39Y4

1951

Public National Bank & Trust Co.

.

INDUSTRIAL STOCK INDEX
:■

12-Year Performance of.

pol¬

*cies are traditionally conserva-

pounds to approximately 171,000,-

blacks" have become increasingly

Analysis

Argentina, thr^e in Brazil and
six in Cuba' " raaintains a sub""
sidiary' the Firs.t of Bost°n Inter"

capacity.
Facilities of in-,
creased capacity from 88,000,000

pletion in early 1952.

Bank

present

.

pre-

ing power, regularity of dividend

pounds is scheduled for com¬

Utah Southern Oil

ones

A"

,

oldest,

Qn Jime 30> 1951

It

Tel. NY 1-1932

'

and

share'many^of^the^characteristics «r°!°"y Trust Co, corporations. of
America's largest serves many

of

DIghy 9-1550

since 1785.

tion

000

The

Assn.

England. There
are statistical records showing an
unbroken annual dividend record

ferreds. Their consistency in earn-

and "Philblack O" exceed produc¬

the

Dealers

New York 7

high of 59V4.

a

National

Security

Y.

N.

150 Broadway

ciaj dank in New

enlargement of

sharply.

"Philblack

made

conservative

states.

sat

fords additional

i.

Gerstex & Freivkel

adopted in 1864,were its predecesbut chartered in
sor institutions

*

oi

be attributed to some

recent share actually

prices.

it

commercial

can

w.

Foote Mineral

During the same period

0f

one

.exercising 4784.

tLnU'

cents

First

nation.

replacement cost of-75 cents the issue, the process is further
a
barrel, they would aggregate simplified. Operations of this type
$938 million, equal, after allowing may not offer dynamic profit pofor long-term debt, to more than tentialities, but a moderate profit
almost
a
mathematical
cer$62 a common share. Natural gas is
reserves
Needlcss to
the mod(15 trillion feet) valued
on the conservative basis of only
erate degree of risk involved af2y2

1945

most

cated

share is almost double

York

indi¬

mat-

than

445^

jud g m ethe deposits placed it 14th
n t,
When

Leslie B. Schwinn

price

If these estimated reserves were

-

a

i s

emplpy-

Ulgi
rule

drawal.

MCANDREW & CO.

jn
•

more

Pfd-

Dewey & Almy

of the pattern; Prices

jj- sold at least at 49 each year

is

ter of

1,250,000,000 bar¬

rels, equal to more

Common Stocks

securi-

involved,

bargain

of crude oil are not avail¬

minimum

was

discovery of a

able, it is believed such reserves
can be conservatively estimated at

California Electric Power

California

barrels.

quality

the

ties

estimates of the

domestic

company's

Power

of

259

BS

Cone Mills Common

represent the bid side cf the

used

In the field of fixed income ob- market,
4,476,545 acres in Canada and
An extensive market¬ ligations analysts never relinquish
At the present time First Naing system covers territory main¬ their meticulous search for securi- tional Bank of Boston presents a
ly throughout the Middle West ties selling below the level of siiTiilar possibility for reasonable
and comprises 15,600 outlets. Pipe
comparable appreciation. Just emerging from
lines at the year-end consisted of
issue s. A s- a
period of subscription rights the
2,273 miles of crude oil lines and
suming a rea- stock is selling fractionally above
1,445 miles of products lines.
sonably stable 45 against a high for the year of
Production thi§ year is expected
money market 50 y2. The lowest bid price on the
to exceed by a modest margin the
and
approxi- stock during the past eight years

St. Louis 1,Mo,

4%%

&

Rgts.

of

STREET

Teletype

Allegheny Ludlum Steel

Venezuela.

503 OLIVE

:

Almost invariably

stock.

ical diversity

National

7-0425

.share

(adjusted for 2-for-l split in
1951). In view of the substanti-

First

State St., Boston 9, Mass.
CA.

tunity of' the type being herein
described. The sudden expansion
of outstanding shares is usually in
itself sufficient cause for a recession in the value of any stock.
In the case of a bank, the problem
is somewhat aggravated by the
fact many of its stockholders are
of a fiduciary character and un-

1950

L. B. Schwinn & Co.,

148
Tel.

the aftermath has been an oppor-

[
Examples of the dip bank stocks
ducing bottled gas and in sales of ally higher indicated earnings and take under the impact of an ingas to the carbon-black industry the present strong financial posi- creased capitalization and the suband is itself an important maker
tion, an increase in the $0.60 a sequent rebound are contained in
of carbon black.
share Quarterly dividend rate is the appended table.
Institutions
At the end of 1950, developed
from New York, Philadelphia and
believed probable.
Cleveland that sought new capital
and undeveloped domestic oil and
LESLIE B. SCHWINN
in May and June of this year are
gas
properties totaled 8,757,452
It leads in pro¬

natural gasoline.

MEMBERS

and

able, because of one limitation or
another, to avail themselves of the
share in opportunity to acquire the new

to be around $4.83 a common

The company

Lynchburg, Va.
LD 39

it

fniind

h

^

For the nine months ended Sept.
compact ter¬
1951,
the company earned
ritory embracing 22 states. Crude 30,
oil production is largely concen¬ $49,751,662 or $3.74 a share comtrated in the Mid-Continent, but pared with net profit of $35,885,developments are also important 522 to $2.96 a share in correspondin Arkansas, Louisiana, New Mex¬ ing period of 1950 (adjusted for
ico and contiguous areas. The com¬ 2-for-l split in 1951).
Sales volume of all liquid prodpany is one of the few fully inte¬
grated units that produces crude ucts was 13% higher than in the
oil in excess of its own refinery first nine months of 1950.
requirements, i.e., a seller on
Earnings for 1951 are expected

balance.

snnnlv

monpv

tl0ns "ave IOUna It aavisapie tO
augment their capitial and have
raised funds through the issuance

——~

_

,

.

^
nauon s money supply ana
the consequent growth in bank
a/c.^ 465,758,945 236,560,086 deposits, many banking institu-

property

Net working

request

on

of assets, dividend yield, etc.

12/31/46
Cash
$50,029,582 $26,138,193
Receivable
49,297,919
18,750,948
Oil inventories
48,251,314
21,499,320
Materials & supplies
18,054,745
11.125,399
12/31/50

oil company serves a

American Furniture

Information

tern

,

Trading Interest In

"V.

U. S. THERMO CONTROL

ue, over a pe¬

riod

branch offices

j-—

estabsuf-

with criteria with which to

showed

The company

NY 1-1557

New Orleans, La. - Birmingham, Ala.

be"-

Yf*?£» maLt Fnrtn.
1 f behind t e ma et. F
nately enough, bank stocks abound

reference

antiknock

York 4, N. Y.

HAnover 2-0700

rubber, carbon black and

and

York Curb Exchange

New

25 Broad St., New

operatlon'i^the1^!^of synthetic P[^e, entUie^them to be aked

should

that

Since 1917

its

what

Co!

Members New York Stock Exchange
Members

^ cotldera'ble cm-fa'intf

Specialists in

..

Advisory Dept., Edward A. Pur¬

nitrogen alon§ ,wlth the best in conserv
favorite
security he is usually
chemicals, other chemicals showmves merts Consequent y
thinking in terms
of "growth" ing a healthy growth include solv- they too occasionally provide an
stocks,
Broadly speaking, a ents, high purity hydrocarbons for
as
"growth" stock
laboratories and for automotive
When

{

Louisiana securities

(common) —
Investment

useful.

are

V

Alabama &

and

important in the defense program First National Bank of Boston—
Leslie B. Schwinn, L. B. Schwinn
because of greatly expanded pro¬
& Co., Cleveland, O. (Page 2)
duction
of
synthetic rubber in
which these unique carbon blacks,

(common)

Phillips Petroleum

Teletype NY 1-583

BArclay 7-5660

Dept.,

Co., N. Y. City
Members of New York Stock Exchange

Edward A. Purcell &

Established 1920

Broadway,

LUDWIGSEN

W.

Investment Advisory

Corporation
120

they to be regarded, as an offer to sell the

C.

Hanseatic

New York

C.

intended to he, nor
securities discussed.)

(The articles contained in this forum are not

& Com.

Petroleum

Phillips

f*}
.

Selections

Their

particular security.

participate and give their reasons for favoring a

J ♦

Week's

Participants

Forum

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

in the investment

Alleghany Ludlum

Long Island Ltg. Rights

I Like Best

A continuous forum in which, e?tch

Air Reduction

Commonwealth

This

35 Industrial Stocks
•

BOOKLET OX

REQUEST

-

National Quotation Bureau
Incorporated

46 Front Street

New York 4, N. Y.

.Volume 174

Number 5062

.

.

The Commercial and Financial

.

Chronicle

(1743)

In Which Industries

INDEX

liCHTflMflll

B. S.

Should You Invest?

Articles and News

&

AND COMPANY

to

Abroad

—Henry W. Balgooyen

Co., New York City

Cover

"AFFAIRS OF STATE"
In Which Industries Should You
Invest?—N. Leonard Jarvis__

Market analyst notes advance in stock
prices has been dispro¬
portionately low in relation to increase in book values as well
as

Page

Environment Needed to Promote
Investing

By N. LEONARD JAR VIS*

Partner, Hayden, Stone

After

Mobilization—What?—Dexter

M.

3

Keezer__——

4

Favors specific

What Outlook for Inflation?—Jules
Backman____

com-

-

panies in oil, chemical, moving picture, titanium, steel, copper,
new
synthetic fiber, metal, television, and utility industries.

/

year,

or

more,

or

personal

hearing -quite

public
has
been
a
bit about infla-r

tion

income, because of
longer work weeks,, some further
advances, in.-wages. and overtime

officials

pay.

American
from

the

in

Wash¬

ington.

These

remarks

have

may

been,

In

instances,

many

of

well

This

all

to

7

is

market is not too

they
d

e-

to

of

and

us

decide

whether

the

industries

are

market.

probably

I

think

vance

would

pre¬

it.

Fur¬

vent

N. Leonard Jarvis

thermore,

the
Government's

program in some respects has been
to put in effect various restric¬

tions and high taxes, the
passage
of which legislation would
be fa¬
cilitated if the public were to

ac¬

cept

the inflation thesis and I
believe that the public has be¬
aroused

come

come

and

frightened

value

of

the

that it has be¬
to

as

dollar

the future

and

that, in
many respects, it has been buying
common stocks as a
hedge.
Of course, one of the

portant

influences

im¬

more

playing

uporr

the American business and finan¬
cial scene is the foreign political

outlook.

Just

undertaking

the

now

nation

tremendous

a

would

bring about
large Federal
deficits, would shift manufacture
more
largely to armaments and
would require rigid Government
another

period

controls

of

most

over

forms of

eco¬

nomic

activity.
Peace, on
hand, probably would
terially reduce"the pace of

ma¬

defense

fide

the

other

effort

.armistice
effect.
We

would

the

bona

a

have

the

same

However, I believe that if
going to make any choice

are

to

as

and

potential

that

developments,

we

the

market

1949, for most of

we are

of

many

near a

has

had

services

totalled

national

our

lion,

and

The

great

a

debt

Now

will be around $275

last

Generous

debt

a

is

tion that

bull

the

Canadian

and

continue

one or

moderate

which

as

I

we

will
that

their

investors
stock

common

should

base

programs

on

This program should ensure the
continuation of a high level of
industrial

production,

employment and

6%

can

capital

which

is

investment

Small

growth of public spending power,
*An

ddress

Adults'

by

School

auspices

of

of

the

Shareholders

Montclair,

Federation

of

American

in

New

Mr.
Jarvis
before
Montclair, under the

Jersey,

Mr. Jarvis is Past President

Society

of

Security

President

of

of

Brokers.

6,

1951.

of New York

Analysts,

Association

Women's

Business,

Nov.

and Past
Customers'

Bookshelf___:

44

_;

earn

still

grade

corporate

From

force

better

available

to

be

us

vs.

Book

4

Security

25

____:.

Salesman's Corner

1937, when the Dow Jones

Now

Baker-Raulang

38

Registration

The

Security I Like Best

The

State of Trade and Industry

.1

;

Collins Radio

2

^

Industrial average book value was

$88.30

a share over $100 has been
plowed back into these companies

Tomorrow's Markets

to

bring the book value on Dec. 31,
last, up to $194.20 a share. The
Continued on page 34

.

Washington and You

Dictograph

5

__

(Walter Whyte Says)_

34

Di-Noc

44

___:

.

•

,

interested

are

The
in offerings

of

Twice

FINANCIAL

High Grade Public Utility and Industrial

U.

and

'

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

CHRONICLE

WILLIAM

Patent

Copyright 1951 by William
Company

Office

B.

DANA

COMPANY,

Publishers

Park Place,

25

New York 7, N.
REctor 2-9570 to 9576

WILLIAM

Spencer Trask & Co.
Members

New

York Stock

Broad Street,

Exchange

New York 4

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Chicago




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records,

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Thursday

vertising

issue)

Business

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Manager

city

news,

Offices:

Chicago 3, 111.

news

N,

Hoving Corp.

Eng¬

Stromberg-Carlson

Dana

—

market

news,

Possessions,

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United

Territories

Pan-American

Union,

Canada,

of

Countries,

quotation

Bank

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St.,

(Telephone: STate 2-0613);

and

Note—On

rate

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per

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year;

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in

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Monthly,

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of

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York

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Quoted

year.

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

Sought

year.

Publications

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$30.00 per year.
the

La

Works

States,

$45.00

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Other

ad¬

bank clearings,

South

Whitin Machine

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(com¬

etc.).

135

Febru¬

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

Subscriptions

Other

and

Monday

every

issue

corporation

and

Other

(general

and

plete statistical
state

Albany

SE1BERT, President

RIGGS,

Thursday, November 8, 1951
Every

Street, Boston 8

Hubbard

B.

second-class matter

as

Dominion

D.

C.,

1879.

York Curb Exchange

50 Congress

HAnover 2-4300

DANA

25,

ary

York,

Y.

HERBERT D. SEIBEKT, Editor & Publisher

WILLIAM

E.

1

S.

Reentered

V

preferred STOCKS

Weekly

COMMERCIAL

Reg.

25

Air Products

20

Securities

in

1-1826

26

Securities

Values

just look at the relation¬

Teletype NY 1-1825 & NY

41

'j

funds.

THEODORE YOUNG & CO.
40

Exchange Place, New York 5, N. Y.

WHitehall 4-2250

j

Exchange PL, N. Y. 5-

27

Offerings

Public Utility Securities
Railroad Securities

40

43

Governments

on

ship of stock prices to book values.
Since

Singer, Bean
& MACKIE, Inc.

32

Reporter's Report...:.

Prospective

buying has been at a relatively
level, as evidenced by the
Exchange members' small debit
balances..
.■
Prices

•

28

.

Our Reporter

buyers

• \

22

Observations—A. Wilfred May

in the market because speculative

..

West End Chemical

37

HA-2-0270

Our

Porcelain

Corp.

Sterling Oil of Oklahoma

7

Funds

•,

Greater N. Y. Industries

16

Washington Ahead of the News—Carlisle Bargeron

NSTA Notes

investors;

important

Steel

8

-----

News About Banks and Bankers.

equities.

It would
that professional investors

continue

Baltimore

6

__.

Einzig—"Dollar Gap Constitutes Serious Problem to Britain"

will

wonder,

and

Manufacturing Co.

24

Dealer-Broker Investment Recommendations.

still

Published

We

21

Artkraft

Man's

from

Let

and Los Angeles

Cover

Coming Events in Investment Field

therefore,
that
pension funds, savings
banks, trustees and other institu¬

maximum

-

Direct Wires

27

-

Mutual

the further

-i

6

Teletype NY 1-3370

of

low

this assumption.

Gold Market______.____

(Editorial)

Canadian Securities

common

believe

appear

ing

Free

investment

tional

'

Broadway, New York

BO 9-5133

reac¬

important

an

Business

price-earn¬

will all have to agree,

and

in

Bank and Insurance Stocks

two weeks

highs,
yields in

like it

whether we
not, that defense spend¬
reach huge proportions

Sell

61

24

Indications of Business Activity

cash

Request

Regular Features

still flows into equities.

or

Firm to

underlying the current stock mar¬
ket. In virtually no other field of

from

on

Reilly&Co;

Philadelphia

times that of

market

ratios

than

J.F.

16

20

now

establishment

generous

ings

...Cover

Seen Continuing at Favorable Level

Federal Reserve Index to Be Discussed

profits
high of

Despite the

had

we

after

have

2.7

or

1929.

year

stocks

*Prospectus

Incorporated

sharply

all-time

new

$22.8 billion,

new

West End Chemical

23

Yields

corporation

year

at

ago,

21

Lusty Infant—Vernon S. Vivian.

billion,

Earnings have jumped

the

16

$260 billion.

Still

and

Hasle Mines

___;

(Boxed)

As We See It

were

Flying Tiger

14

Risks—Roger W. Babson_______

If

155

year will be around
$325 billion and that national in¬

around

14

Gaston___

are

around

Federal

*Dome Exploration

Security Program and Foreign Trade

Business Activity

services this

the

Cedar Point

Enterprise System?

Private Enterprise the Key to
Foreign Productivity-..

million people in this country and
the production of goods and

that

Canadian Superior Oil
12

.

was

we

Mutual

Calculated

that

and

11

Nourse_____\__

G.

The Mutual Fund—A

$87 bil¬

was

Federal

YORK

13

—Thomas D. Cabot~______

$103 billion and

income

the

NEW

WHitehall 4-6551

to think

us

top and

less than $17 billion.
told
that there are

come

Movement—George A. Nicholson, Jr

Loans to Build Sounder Trade—Herbert E.

cannot

us

it

Do

10

Stalin Right About the Free

Edwin

help but re¬
member what happened in 1929.
However, again, I must say that
things are different today!
In
1929, our population was 122 mil¬
lion, the production of goods and

arma¬

building its
defenses for war and any change
in
the status quo, that is, either
peace
or
war,
would
definitely
lead to a very great change in the
general picture. We are quite cer¬
war

which

is

ment program that is

tain that

Is

of

when

Expediency Should Not Motivate Foreign Policy!

—Benjamin F. Fairless_/____^

is

—■

obsoletes.

WALL STREET,

Telephone:

8

Foreign Trade and Point IVJProgram Passports to Progress

behind

it

sired to create

since

_;

wait

unloading

stock

high in relation

the

activity that

99

Inadequate Rail Rates Endanger Our Defense Program
—J. M. Symes___.

our

only
normal, in view of the sharp ad¬

type of

Cobleigh______

The Investment Club

to other economic facts and which

the

to

affairs

over

don't

Obsolete Securities Dept.

the Shares of Electric Utilities

on

—Henry Ford, II

main problem at hand at this time

fear that it

hence,

But

now!

background is pretty

known

might

probably

Political

of wives and other members
the family going into defense

work.

and

family

—Ira U.

cause

motivated

place

1

unit income will be increased be¬

partly by the
knowledge or
take

A Current Line

hesitate

can

state.

it

6

Dangerous Trends in the American Economic
System
""'—Bradford B. Smith
_______

During the past
the

You

conies

general inflationary expansion.

3

Teletype NY 1-3236

The Commercial and Financial Chronicle

4

.

.

Thursday, November 8, 1951

.

(1744)

sia, much of the United States,
virtually all of Europe and be at¬

Alter Mobilization—What?

tended
and

of Economics,
McGraw-Hill Publishing Company, Inc.

'

Director, Department

As

standard

our

living has

of

risen, right along with it has risen
the share of our total production

prospective customers can

which

or

leave

without

any

take

marked

the

provided

which

are

price inflation roaring. But people
did not rush into the market, as

per¬

going to be foolish enough to
one.
In stating
any
such

he

they had after the shooting started
in Korea and again as they did

New York

in

after the Chinese entered the Ko¬

has

living

billion.

part of
produc¬

large
our

tion

can

severe

without

pass up

inconvenience.

I

any very

range

it

is sometimes called.

But some

estimates, which are at least
thoughtful, have placed it as high
as 40% of our total production of
goods and services.
This

means

between great

depression
has
the
to

that

difference

the

prosperity and deep
United

the

in

States

to

depend on persuading
American/consuming public

come

tion to buy

off

of

know

precise calculations of this
of optional consumption, as

no

I

keep on ^buying things which,
the consuming

I

a

wave

know

of

of

opment
portance

which

that

than

the

has

the

it without much of any

either

inconvenience

in

large

am

-the practical
that potential I

of

their importance.

public is under

no

World

heavy pressure

YY.

YYYY

.

Not in Prospect

War III

necessity to buy. This means,
Implicit in what I have said, of
in turn, that our prosperity is, as
course,
is the* basic assumption
our standard of living mounts, in¬
that World War III, with Russia,
creasingly in the hands of the is not in the offing—at least the
-

salesman and the sales executive.

immediate

And so, too, as I see it, is the req¬
uisite economic foundation of

this is

much

all I

of

our

I

personal-liberty.

shall develop the connection later.
In recent
a

months

have had

we

dramatic demonstration of what

the

broad

of

area

v

optional

con¬

a

offing. Whether or not
valid assumption I have

certain

no

of knowing. For
know for certain, a friend of
way

mine, a notably successful busi¬
ness consultant, who recently gave
me a

wretched time while he beat

the drums of doom may have been
on

the right track.

Between the first quarter of 1951

to

lunch and filled

and the third quarter

of 1951 the
disposable income of the people of

food, much in the

the United States

last dinner.-Then he proceeded to

sumption in this country

can mean.

(that is, money

a

condemned

He invited me

address

by Dr. Keezer before the
Conference of Sales Managers, The Ohio
State University,
Columubs, Ohio, No¬
vember 1,
1951. / ' .

tiny

in which

is given a lush

unfold his conviction that
*An

our

des¬

in

ahead

the years immediately
is all-out. war with Russia

which will

—

to

did

and

means

race

where

two

end

not

destroy much of Rus¬

peace—is not true.

I

sure

am

that

our

It

about

drive

to

to be an

increasing number of people who
that this rearmament drive

think
will

be

big enough and continue
long enough to keep business as a,
whole booming indefinitely. I do

this group—for two
One reason is that, as a

seems

the
to

rearmament

program
rather more likely to

me

be cut down from the proportions

projected at present than it is to
be further expanded. The second
reason

is that,

even

if

program

a

of

approximately the present di¬
mensions is carried out, it will
still leave very considerable seg¬
ments of business up against the

why here

at

particularly

ML

we

on a

never

to

the best of

So anytime you

office.

we've

our

have

help, we'd welcome
nearest

to

ask when

difficult piece of business.

On the other hand,
others

hesitate

from time to time. That's

the

never

are

checked

Let

us

one

continue.

Y

in

conflict

a

on

page

32

statistical

preconceived

Y.

a

fundamental

One year
we

I bought it

technical approach.

both

later

the

Korea and the stock goes down. Haven't
problem? The problem is whether the stock

comes

same

unexpected happening.
quantitative value viewpoint is "yes,"
you will hold the stock. If my work still indicates higher levels,
I will also* continue to hold the stock.
Of course, I have the

still should sell higher regardless of the
If your

•

answer

from

a

,

observing how the stock is acting relative
general market as well as checking your approach as to
value outlook under changed conditions.

added advantage of
to the

the

Implication of Divergence
You state that in demonstrating the

divergence that has re¬

cently occurred in the market, I prove the impossibility of con¬
ceiving of the market as a whole and hence of forecasting a

Well, suppose you studied 1,500 stocks
approach and 900 appeared overvalued, 300
appeared fairly priced and 300 appeared undervalued based on
present arid future outlook. Wouldn't you say that, on the avermarket

future

from

a

trend.

statistical

Y age, the market looked high enough
sell lower?
My technical approach

and would, on the average,
is the same. I study the
that the market looks higher
that each stock is going to

graphs of 1,500 stocks. When I say
or
lower, I obviously don't mean
move

in the

But when I express a general mar-

direction.

same

C

•

Continued

>

on page

31

/"Published in the "Chronicle," Nov. 1, 1951, p. 3.

to

try.

:
you

think

we

Simply call

Collins Radio

can

^SENECA OIL COMPAW

Placer

CLASS "A"

our

A

Trading Department

Circular

*

on

Request

dividend

opportunity

TUNGSTEN-OIL-GOLD

Information on request

BUTLER, CANDEE&MOSER
44 Wall

70 PINE STREET

NOT YORK 5, NY Y.

Offices in 97 Cities

Teletype
NY

1-1862

St., New York 5, N. Y.
'

,

BOwling Green
9-0040

Analysis

GENESEE VALLEY

Powers

Bldg., Rochester 14, N. Y.
:

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BO

available

on

requeat

John R. Lewis, Inc.

SECURITIES CO.
Telephone LO 3190

;

LEAD-ZINC

paying growth
in Crude Oil

Merrill Lynch, Pierce, Fenner & Beane
Underwriters and Distributors of Investment Securities
Brokers in Secuiities and Commodities

Development,
Limited

t




or

because I thought it undervalued
Of course, I would have taken one
step more. I would have double-checked by seeing if it also
was
undervalued fundamentally.
But we will leave that out.
approach.

necessity of scrambling hard for
Continued

Y

should be taken when such an event

course

with

,

need it—

that I watch and all of

of the market

against the other to arrive at a conclu¬

hesitated about helping '

problem, and
chance

indices of the action

30

•

'/

""

ability either.
a

we

trend

tical

of the world, such as it is.

At present there seems

"system," technical or otherwise, that can predict
Secondly, I am much more interested
of individual issues than in the general market.

no

from

,

safeguard to the;

peace

a

market approach.

in hand and rise to the defense of

opinion? Suppose we both bought the same stock in June, 1949.
You bought it because you thought it undervalued from a statis¬

Y

I have no doubt that our rearma¬

is

the "technical"

of

result, I have graphs of almost every stock on the New
Stock
Exchange and many on the New York Curb.

a

is

are or

drive

readers, I was much impressed to find

of the fallacies

signal. Well, what

/.

bit of our

ment

avid

vour

You ask the question what course should be taken when a
"totally unexpected" event is in conflict with a technical market

scared to death." Whether
not, I don't know. But

are

they

Y

,

replied, "If they hqve any sense,

they

;

.

and who had
rearm,

of

sion.

If Stalin

"What
the Russians?", he promptly

industrial

/

part and parcel of last week's column as one of the

them

German friend of mine who knows

quite well,

yY* ;

Thirdly, I do not use one single "gadget" like some of the ex¬
amples you quote earlier in your column. I have some 20 or
Y

great drive to

recently seen quite a

the

York

giving him pause.
Indeed, when I recently asked a
Russia

Y

shorter-term trends.

As

must be

rearm

whole,

us can use

in

,

similar adventure in mind

reasons.

something all of

the

to race with him when he
to rearm Germany that
emboldened Hitler to make his
power.

■!'Y'Y

'

.

hasten to take my pen

me

I know of

rushed

thrust for world

v>

communication which, in

"triple check."
First, let me explain that my particular approach to techni¬
cal analysis is confined to the longer-term trends of the market.

anyone

had any

a

the

up

not belong to

ThatY

Let

against

arm

one
was

examples

obviously the very absence of

was

with fine

me

manner

man

As
that I

races—that the absence of an arms

determine,

impressed than ever by

more

true.

fighting each other. But, in any
event, I am sure that the reverse
Since of the proposition about arms

measure,

consequences

example
hurried

other

A. Wilfred May

VY^'^'vY'',-YvY. Y 1

YY/. YY

.

Mr. Tabell has addressed

PROM MR. TABELL

immediate

way.

will

executives

sales

each

jfr#iYi.nw/.i,r ir/fcXu V<&,l/fbuJ

Dear Mr. May:

Century—the British and
after the Napoleonic

for

wars,

people as a whole so
rich that they can take a large
share of our production or leave

an

Mr. Tabell has cheerfully assented.

French

countries

American

average

rise to

clear, as well as authoritative defense of the "techni¬
cal" investing approach, we are particularly glad to publish; fol¬
lowed by a word of rejoinder from us, to the inclusion of which

think of cases as recent as

can

the 19th

the

made

is historically

that

if

I

a

view of its

very

much

potential im¬
years
ahead

greater

over

I doubt

outcome of this ofte.

devel¬

economic

no

To this

that
in history has
ended up in war, and that conse¬
quently was is bound to be the

might, of course, touch
of unemployment.

by

his

of the market."

proposition, so

the

possible 20%

falling between two stools; and that
(3) the everpresent divergences between issues and groups within
the market render wholly impracticable the forecasting of a "trend

race

arms

every

however desirable,

of

and

humble, however, in

with

dealing

a

>"£>

nothing about it; every¬

less

am

to predict

on

contradictory to a "teenn iCctl" pul tCl.lt l/i
nal," leading to the confusion of the investor

frequently cited these days,

stances failure to exercise the op¬

goods and services which consum¬
ers

broad range of optional

a

the money basis for another surge
of
inflation.
In
other
circum¬

Keezer

M.

Dexter

into

goes

ex¬

consumption made it possible to
neutralize,- at least temporarily,

This
very

a

Thus in this case the

of

goes

tually exclusive, however tempting it may be
to think one can have the best of three worlds;
that (2) an economic factor may be directly

thing we write is guess work,
though we hope intelligent guess
work."
Y Y"

istence of

American

is that

quarters

1951 savings
jumped from $9.3 billion to $21.1

already a
key fact about
economy.

We know

second

what

was

the

Being under no urgent

present—and between the first and

magnified still
further

"Sunday Times Maga¬

zine," that "In discussing any sub¬

necessity to buy, they decided to
save their money—at least for the

of

standard

War.

rean

nation's

the

xvrrr.'*

that

ject connected with Soviet Russia
there is one preliminary warning
which should be compulsory on
all writers on international affairs.

increase

technical market analysis.*

on

ing better than the market in general.
Our exceptions were taken on the grounds
(1) these several policies really are mu¬

by an Oxford don
Taylor who wrote in the

venience. This

incon¬

sonal

major paper,

Technician," by Mr. Ed¬

all-time peak, with some secondary issues do¬

cited

cently
named

Market

Tabell, leading authority

decline in the market followed

fully
of the fact, re¬

of course,

and humbly aware

took issue with a

we

the

b,y two other important "tools," namely eco¬
nomic
research and security analysis.
Then

start

fires of

to

discern the trend of stock market prices.
Such
"technical" observation is to be accompanied

circumstances, I

I 'am,

Goes

Mr. Tabell had maintained that indispensable to the proper con¬

ail-out war with the
World
any
time' soon.

conclusion

Man

duct of the "prudent" trustee, aiong witn otner
"tool s,"
is internal market "evidence" to

impossible to believe they

it

find

fuel

money

the

keep

to

"The Prudent
mund W.

an

Western

after

consumers

War

not

winning

paying taxes) jumped from $217.5
billion to $225.7 billion. That in¬
with

all-out World

an

In this column of last week

only can
but will be
avoided, at least for some years.
As I see it, the Russians would not
have one chance in a hundred of
III

And, under such
of

hands

crease

that

think

By A. WILFRED MAY
That Tool Question

international

the

of

employment and rising prices.
the

======

cheerful view
outlook.
I

I take a far more

trimmed, thus afford¬
ing considerable leeway for civilian business. Asserts capital
expenditures for defense program can be partially replaced
through filling industry's modernization and efficiency needs.
Emphasizes importance of public's ability to postpone 40% of
its consumption. Predicts permanent politically-motivated full
in

remarked,

ghoulishly

the time to start worry¬

ing in earnest about tne conquest
of the world by Communism."

expenditure should and will soon be

ment

friend

"will be

continuing "Cold War" arma¬

Business economist maintains in

by widespread pestilence
political/chaos. "After that,"

my

KEEZER*

By DEXTER M.

8?

r

1006 SECOND AVENUE

SEATTLE
Teletype SE 105

ELiot 3040

Volume 174

Number 5062

.

.

.

The Commercial and Financial Chronicle

it

is in the Detroit area, which is normally
in the steel market to show weakness.

e
Steel

The

Froduction

Electric Output

Retail

State of Trade

2.3 million tons.

and

of 4

Price

Auto

Industry

Index

Production

Business Failures

shortages

materials

strikes

in

evident
in

producers
from

Eastern

the

nation's

those

ports.

greatly

Although

some

employment and

remained

this

layoffs
remained

were

furnaces, operating at 104.5%

previous week.

This brought over-all steel output to
nearly 6% above that of a year ago.

This

of capacity

some

by the end of the

a

Prices

of

reached

a

$66

Interest in

all

bars

conversion

now

a

vitals of the

abrupt.

ingots

over

ton,

a

sinking fast.

are

$100

ton.

a

last

and

ton, it added.

and

these

week

•

,

A few months

a

were

Poor's

as

the

ing

.

,

.

same

aimed

arranged

at

\'/

\

\

'

/

\

i

/

\

'

|

\

'

lv

M \

'

look at their

earnings

are

of

the

declined

slightly

Recent

What

f

V

Market

Now?"

which

Reaction—

in

appeared

the "Chronicle" of Nov. 1, page 15.
The table in question was given
on

35 of that issue.

page

With Burgess & Leith
(Special

to The

BOSTON,
don

Financial

Chronicle)

has

Mass.—Jack

become

I. Lon¬

associated

with

Burgess & Leith, 30 State Street,
members of the Boston Stock Ex¬

Despite

change. He was formerly with
Pearson, Erhard & Co. and prior

sales, ship¬

the decline.

on

credited

III,
"Stocks
Quoted
Equity in Working Capital,"
in the article by George F. Shas¬
kan, Jr., captioned, "The Meaning

bitter

getting rich off the

balance sheets.

not

Table

thereto

was

Nason &

an

officer

of

H.

L.

Co., Inc.

With Rodman & Linn
.(Special to The

Financial

Chronicle!

"CHICAGO, 111.—James E. Keefe

the previous week, dropping about 2%

III is

&

Car output, however, was about 38% below the

now

members

like week of last year with trucks down 9%.

affiliated with Rodman

Linn, 209 South La Salle Street,
of

the

New

York

Midwest Stock Exchanges.

and
>

;

"

,

-The statistical agency also stated "it seemed certain" that 1951

obtaining

would

them.

of

become

record

a

truck year,

1,369,000 units built in 1948.

hoping to construct 102,000 commercial vehicles this month,

But the turn

■

'

Y

'

'

With A. C. Allyn & Co.

topping the previous record

United States truck builders

are

CHICAGO, 111.—Frank L. Tennent

com-

has

become

A. C. Allyn &

Continued

on

page

36

roe

Street.

i/

;Q::q;;Q;:Q;;O;
M

a

was

of the data compris¬

Near

industry, "The Iron Age" concludes.

motive Reports."

ingots

'

forging billets is still keen with nearly

being

should take

are

Corp.

source

slated

below the figures of the week before, according to "Ward's Auto¬

Recently they have been

And it isn't being regarded with the significance




who

&

In the automotive industry production of passenger cars and
trucks

Sheet demand is softening in other areas, too.
so

manufacturers

Some

Steel leaders aren't crying the blues about this. But
they are
fearful that the steelworkers and the government will
try to carve
a
wage increase out of their "fat" earnings and end up cutting the

Cold-rolled sheets quickly lose their
appeal above market price.

isn't

quarter cancellations has been

NPA.

to

ments and expansion, their

no

conversion

low of

of fourth

their continuing onslaught on records for production,

year.

they sold for well
selling for $85 to $90

took 2,000

dearth

defense boom

level that

of the biggest users in the
industry. Unless
sheet conversion will fade out of the picture

ago.

plates.

on

very

Anyone who thinks steel companies

market is

includes

still

are

sharp cutbacks have gotten part of their allotments restored
by appeals, this trade authority notes.

tional

the trend reverses,

bars

disappointment

longer any question that the steel sheet
softening, according to "The Iron Age," na¬
metalworking weekly. Conversion's biggest customers, auto
firms, are dropping their conversion arrangements like hot potatoes.
conversion

Source of Shaskan Table
Through inadvertence, Standard

for

blast

This week there is

program

The

high

last week compared with 102.9% a week
earlier, forged about 32
thousand more net tons of ingots and castings than
they had in the
was

But

5

Standard & Poor's Was

original estimate

an

tons. In January it is expected to take
2,900 tons; in February. 3,700; in March, 4,300. The rapid growth
of demand for shell steel
reflects, in part, conversion from brass
to steel casings.
"i

to

imports of
hampered by dock

increased

tons.

scaled down from

was

tight. Farm equipment 'takes
a lot of this
product in the Midwest. Added to this demand is the
growing amount being taken by the shell program. In December

upon

payrolls

stronghold

lot of water.

Hot-rolled

ago.

year

a

dependent

were

abroad

past week,

comparison with
The

and

a

This

profitable products to meet their share of the load

The level of over-all industrial
output displayed a pronounced
increase last week and continued to hold well above that of the
like period a year ago.
Raw materials
many

last

steelmakers believe this figure still con¬
They point out that this would be the greatest
quantity of plates ever produced in a single quarter—and it doesn't
include a major shipbuilding
program, "The Iron Age" states.
Some mills are voluntarily
shifting production from other more

J
plague

million

tains

Trade

Commodity Price Index
Food

the

Government plate requirements for the first quarter are about

Carloadings

raw

(1745)

pen

'

arcade

'

Inquiries invited

Stanley Pelz & Co.
i'
•

;;

„.

INCORPORATED

40 EXCHANGE PLACE

!

"IV ..'

;

NEW YORK 5, N.

;

Y.
■

r.

BOWLING GREEN 9-5580

,

Private Wire to

"

TELETYPE NY

Republic Investment Company, Inc., Chicago

1-3089

1

N

/IN

*

f N

'1

associated with

Co., 100 West Mon^

6

The Commercial and Financial Chronicle

(1746)

of

or

University

Dr. Backman cites various inflationary elements as :

of

cause

BACKMAfcJ*

large budgetary deficit and a substantially increased degree of inflationary pressure. We have come
fairly close to a- pay-as-you-go
policy, at least for the first two
years of the armament program,
I do not minimize the signifithe cance of such deficits as do de-

This is tied in directly

war.

deficits
and how they are financed.
The
first and most important question,
therefore, is the outlook for the
Federal budget. For the current
fiscal year, a budget deficit of $10
Federal

with

continuing

motivated by

breaks in the wage line, corporate extravagance

.

Thursday, November 8, 1951

While criticism may be directed wage line Would be reflected in
at
the types
of tax
increase higher costs to government and to
and at the same time
been the creation of bank credit adopted, in the absence of these business
would have a negative impact on
to finance the costs of armaments tax increases, we would have a

What Outlook fox Inflation?
By DR. JULES

.

past, the fundamental
armament inflation has

the

In

Professor of Economics, New York

.

ready availability of politically-moti¬
vated
inflation "shots" to forestall any major business let¬
downs. Concludes while there will be no significant inflation

excessive tax rates and

budgetary

government tax revenues. By in¬
creasing consumer purchasing
power

at

supplies
decline,

a

when civilian
rise, and may
pressure
for price

time

will
the

not

rises would be accentuated.

Cor¬

poration taxes have risen to the
point where they contribute to in¬
billion has been forecast by
government, before allowing for velop. I am convinced that a pay- flationary cost increases because
over the next six to nine months, over the longer term, trend is
the rewards for careful spending
any new taxes. After allowing for as-you-go policy is the best one
small.
Political
considera¬
toward more and more inflation.
the higher taxes now being en- to follow. However, I am attempt- are
acted, the deficit would become ing to evaluate the significance of tions lead to further shots of
After the Chinese intervention,
Let me emphasize that the basic
$6 to $7 billion. However, the fi- the - prospective
1951-52 deficit inflation whenever the economy
a
letdown.
pressures in an armament econ¬ consumption expenditures boomed nancial needs of the government against a total money supply (de- shows any signs of
omy are inflationary. The question to an annual rate of $208.2 billion are determined by its cash budget posits and currency) of $177 bil- Thus, the lull we have been ex¬
is not will we have inflation, but in the first quarter of 1951, This rather than
by the more conven- lion and demand deposits of $91 periencing in recent months, and
when and
to boom in consumer buying was fi¬ tional
type of budget. The cash billion. In that environment, I probably in the months ahead, is
nanced by a combination of rising
the disposable income (rose at annual
past
six rate of $20 billion from second
months there quarter 1950 to first quarter 1951),

extent.

what

During

has

been

steady

a

reduc-

in

rise

a

billion

$1,7

credit

consumer

1950

June,

from

(rose

to

I

1

»

1

_

A

_

_

1

_

A

_1

_

J

_e

tax increase and

new

n

in

cession

tries-a
Jales Backman

minor

in

drop

in

significant

decline

buying,
(16%). in

prices of sensitive

:

March

the

to

extept

1951.

During the

period business

same

year

Past

or

$66.5 billion,

in interest rates.
have

raw

decline

These tendencies

developed despite the steady

increase in government spending,
a

a

creeping advance in wage rates,
further rise in plant and equip¬

ment

expenditures,

tinued

rise

The

in

and

national

that

inflation

a' con¬

income.

developed

$54.4. billion).
because

started did not stem from an un¬

billion

balanced

the

traditional

of armament inflation. Dur¬

source

ing the first fiscal

year

after Ko¬

.1950-51, there was a Federal
budgetary surplus of $3,5 billion;
the cash budget showed a surplus
cf $7.5 billion. Rather, it stemmed
rea,

from

a

consumer

and

Predictions for the 1952-53 fiscal

business

buying

spree because of fear that
goods would not be available and

prices would rise.

C □ M IN G

hazardous because
so much depends upon what happens on the war front. The latest

EVENTS

very

are

Government will spend between
$80 and $90 billion in that year,
This is a rise of $10 to $20 billion
over the level of spending in the

spending may not increase aS current fiscal year. In the absence
rapidly as anticipated. Tax yields of any new tax increase, this level
be over-

underestimated,

or

The

for

comments,

the

on

inflation

of problem.

In

Field

Investment

.

estimates indicate that the Federal

Nov.

9, 1951

Securities

(Detroit, Mich.)

Association

Traders

of Detroit and

Michigan, Inc., an¬

nual
Fall Party at the Detroit
of expenditures would make in- Boat Club.
..' V
evitable a substantial budgetary
deficit. Even after allowing for Nov. 9, 1951. (New York City)
y
some rise in government revenues,
New York Security Dealers
as a result of higher national inAssociation 26th annual dinner at
come, a deficit in the neighborthe Waldorf-Astoria Hotel.

hood of at least $15 billion would
budget shows a cash seem
to
be • in
prospect.
But Nov. 14, 1951 (New York City)
quired to meet the higher con¬ deficit of only $2-$3 billion in the whether the precise deficit is this
Association of Stock Exchange
sumption expenditures referred to current fiscal year, it is clear that amount,
or
a
little larger or
Firms
Annual
Meeting
of .the
earlier.
Mainly to help finance no important inflationary pres- smaller, there will be a reemerBoard and Election.
this large increase in inventories, sures would
be generated
from gence of large scale deficit financcommercial bank loans
rose
by this source. This sum could be ing in the fiscal year 1952-53. unVov. 25-30, 1951 (Hollywood
almost $10 billion in the same nine raised from
non-banking sources less there is a major change in our
month
Beach, Fla.)
period ($44.8 billion to without too much difficulty. The armament program. If this situa-

immediately after the Korean War
budget—the

ac¬

4*1 atlAfl

of

from

billion to

V*

government's

the

the latest official estimates.

acceptance of
the official
$54.2 estimates,
therefore,
is
fraught
by more with danger. Nevertheless, I feel
was
the that they do provide a useful basis

inventories increased

materials, than $12 billion. That
(4%)
in extent to which business men
wholesale prices, little change in
quired inventories in excess
retail prices, and a moderate rise the
larger quantities of goods
a*: moderate

of

i

I

significant inflation likely to be temporary.

of

six to nine months.

may

con-

'sumer
a

debt

into

went

r.

A

no

result

a

budgetary deficit during the next

deficit of

a

the

indus¬ $3.2 billion between June 1950 and

many

as

$2-$3 billion after that increase.
Let me emphasize that these are

March, 1951), net redemptions of experience has indicated that such
fears of infla¬ $800 million of series E bonds, and estimates
may be at considerable
tion. This pe¬ a net reduction of $717 million in
variance from actual results.
For
riod has been time deposits, postal savings de¬
example, any deterioration in the
characterized posits, and mutual savings bank war situation could be reflected in
In other words, con¬ a
by a moderate deposits.
stepping- up of armament •ex«inventory re¬ sumers used up liquid assets or pepcUtures. Alternatively, the rate
tio

M

anticipate

budget is expected to show a def¬
icit pf about $6 billion before the

the
in

posits

was

more

in

securities,

demand 'de¬

kept to modest propor¬

However, deposits
active

more

largely

disposed of $7

government

increase

net

tions.

However,

banks

as

reflected

became
in

If the cash

re¬

the

than 20% rise in bank debits.

This survey makes in clear tnat

recent

der
in

proposal by Secretary Snysell

to

than

$2 billion
tax anticipation notes to cormore

tion materializes, there will be a

Investment Bankers Associatio*

inflationary

Annual Convention at the Holly¬

resumption

of

real

pressures.

,

wood Beach Hotel.

i

pqrations would be,helpful in this
While
the foregoing analysis
connection.
However, to the ex- contains much that is reassuring
that funds

tent

are

received from

the sale of such notes,

like

of financing

trend

pushed

more

the problem
the deficit is merely
forward to the following

Sept. 28-Oct. 1, 1952 (Atlantic

inflation problem, I should

the

on

note

to

that

the

this

fiscal year and hence accentuates

sitting
could

American

Bankers

Annual Convention.

,,

Association
;

V

;

on an

the

erupt

inflation volcano that Oct. 19, 1952 (Miami, Fla.)
at any time.
Our
National Security Traders Asso¬
part of the 1951-52 deficit is wage policy and farm price policy
flected the activation of deposits
ciation Convention at the Roney
financed by the banks, it will be are and have been inflationary,
and
liquid
assets
which
were
of relatively minor importance in Any new
break-through in the Plaza Hotel.
created by the inflationary meth¬
good

a

part

of

inflationary

the

following June 1950, re¬

pressures

problem

at that

time.

Even

if

ods

♦Summary of an.address by Dr. Backman
before Graduate Economics Society,
Columbia University, Nov. 2, 1951

used

to

proportion

finance

of

a

World

significant
War

II

quirements.

re¬

the overall inflation

picture.
these projections
prove incorrect, and the cash d'eficit is- larger.. (If it is. smaller,
But

suppose

^

•

problem

no

is

error

deficit

is

If

created.)

small

a

and

one

stays within $5

I would expect

so,

no

the^%;;
casb^>-;-

the

billion or
significant

;

inflationary pressures to; develop.
If it is much larger, then inflation

November

our

becomes;

significant pressure until

no

Investment Letter

of reality. However,

more

next

spring.

of

Tbe ;reason for this

is fodTid":in; the timing
collecti6ns;%Large receipts

tax

normally

OLDEST NAMES

-, •

.

I

\

I

y

/

recorded in the Jan-

are

ONI OF THE

*

l^tq/;:?;i

statement

discusses

H5

%

in this event, there wouldvbe ; ;

even

y

uary-March quarter.

Accordingly, „»»
need for bank financing, ex-:
cept on a temporary basis^. would; ' .*
develop before next spring,

INTERNATIONAL

no

0 Factors dominating the stock market.
j:"

0 Implications of the

new

tax

bill.

However,
aspects of the

© Earnings and dividend outlook for 1952.
© The glamourous

0 A low-priced

era

of electronics.

stock affording
bargain in net asset value.
common

a

should

not

the

psychological"
present situation

fears

BANKING

•=;..;

i

be

overlooked..-. The /
emergence
of a new period1 "of " 4
deficit financing could create a new flight from money because, of

,

m

to. the end result :'o£; that..
Even more important,;*j&L ,"the danger that any new war scare\
as

policy.
could

be
to

rush

CHARTERED

accompanied by" anew,",
a further

Bank

buy goods and

activation

Your copy

will be mailed to
to

our

Research

you upon

written request

Department.

of the existing huge
supply, I do not have any
pipe dine to the Kremlin which
money

would enable
where

or

me

the

hot

co.

ESTABLISHED 1889




New York

an

->•

40 WAil STREET'NEW YORK,N Y.

•the benefit of this vital informa¬

tion."

•

r

the. favorable prospect for

Leading Stock and Commodity Exchanges
Broadway

M1MBFR
a

small

budgetary deficit has been made...
6, N. Y.

of lite

'

It is also important to note that

Members New York Stock Exchange and other

*799

4"

war-.will:

My
bbsefvitidns,
therefore, must be made without

j. r. williston

-

to forecast when

next

place.

take

115

'

City, N. J.)

long-term

country is toward
and more inflation. We are
in

;

:

f

possible by the prompt action of
Congress in raising taxes. In three
tax

bills

been

.

•.

since

Korea, taxes have
raised more than $15. billion.

—

num

DEPOSIT

INSURANCE CORPORATION

Volume 174

Number 5062

.

.

.

The Commercial and Financial Chronicle

(1747)

'7

daily computed and recorded sta¬

From

Dangerous Trends in the

Washington

Ahead

American Economic
Mr. Smith lists

can

sured it

was

As

a

what

most.

was

no

a

wanted

knew, in fact, how important it was
to the President, how important it is not only
to his own political planning but to the Ad¬
conduct

foreign

of

officer

army

public

an

only

not

this

in

country

but

shal

Truman

is

the

now

head.

Bargeron

to

nurtured him.

country

particular political party. It
matter of tremendous importance to the hundreds

is, however,
of

a

thousands to whom this party means bread

relatively smaller
bread and

the scheme of
that it is

no

things. If

small

it is not

to whom

group

butter but of

The

butter and

and

much

a

means

spoil the

der

happening when there is

a political turnover.
others acquire jobs* and

on

and his

1857.

that

specific

that this

was

possible because both

men are

■/>,

/

of such

base

I

could

of his staunchest defenders in the

one

on

of

Illinois, simply because his

papers as a

him

since.
Mr.

potential candidate.

)l

no

opportunity to take

a

over

dp
is

the

;

missionary work with the General. I don't believe that he
serene over the possibility that the General will
only be a candidate in '52, but a candidate against him.

some
now

not

perfectly

It is

possible, however, that Mr. Truman got a pretty good idea
of the General's intentions without politics being discussed in a lit¬
eral sense. It could be that they parted company on a
high note of
the President's telling the General what

grand job he was doing
and how much the peace of the1 world rested on his shoulders, and
the General

replying

their hands clasped in something like this
vein: "And Mr. President, I am
greatly appreciative of your hav¬
ing given me the opportunity for this-great work and you can rest
assured that I shall

never do anything to betray
your trust." And
then the President could have said: "I have never had the
slightest
doubt about you, General."

Of course,
word for word

when he got home that night and tried to repeat
just what the General did say when he said such,

when he went over it all with Mrs.
Truman, the President may
have come up with doubts as to just what had been
accomplished,
t Mrs. Truman possibly shrugged and said "Oh
well, it will all come
out

in

the

wash."

that

also

are

becoming

reat value of which is confis-

the debauchery. They
people on fixed income^

by

the

of whom are the aged or
dependent,
living .on
pensions,
many

previous savings, annuities or pro-,
of

ceeds

their

,jfe insurance.

former

They

providers**

are

the edte-

cational and charitable institutions

well known to

very

dependent upon income from eirare not, of course,

perpe¬

♦

™ * f*

Krt^lin

thp

and

boom

into

k to keen

£arta th!

^ee™lhig"
"aadI "g

Amert-

g

inflationary

suicidal,

followed

chaotic

by

vile

-s the

intellectual

for

front

ancient trick in

toence is that the old-fashioned
way of d0lYlg 11 was "out ln thC
0pen» wiiere people could
apprajse jt
*

ex-

properly

condemned

combination

When

of

the

fraud

as

a

and

rency

and
no

of

cur-

He once stated,

debauchery

I quote: "There is no subtler,
means of overturning the

surer

existing'
'Jl

basis
thp

faba"™ «e

The

P„rrpnrv

hidden

the

law

structon

and does

on

S nd1'
nVone

if in

a

of

of
de-

manner

million

in

m

to

nrocess

forces

side

the

economic

m0re

that

of society

There^is

no

dangerous trend in our econ-

Z! th!n

the trend

]ar debasement

and

tow!rds

a

dol-

big part of

he dan^be's bi people's
llarS of how it ifdone

un-

and

same

u

it

suppose

is

the

eco-

is obscure to most
That only makes the con¬

people.
tinuing

trend

basement the
The

world

n

destructivenessa-{j®®"m1"

because

nomics of money

toward

dollar

see

pay our

the, consequences

knew

not

^

open

to question

It is

an

offi-

not open to question, it is an on 1

bills is

P°sits

—

in

The present

banks.

J™""1/ these combined is about
$115 billion. This is about $4 bilUon more than " was a year ago;
» is six times what it was in 1933;
« is three times what it was in
1939. This multiplication of money
Is the exclusive fountainhead of
inflation, and this is true no mat-

ter how great the smoke-screen
scramble to pin the blame o n tins
or that element in the population *
The alternate multiplication and '
retirement of printing press money *s als0> in my personal judgment,
the exclusive source of the mflationary

boom

and

depressionary

°f ^ American*
economy'
we could only hav0
Continued on page 18
bUSt

featUTreS

r *

de¬

dangerous.
a
long history

that reaches back at least to Dio¬
cletian

concerning currency de¬
bauchery, and the evidence of that

ANNOUNCING THE

FORMATION OF

is uniform and compelling.
It shows that when printing press

record

money

'give

is first issued

it

seems

to

PARSONS

"lift" to the economy that
fmakes everybody happy — much
like, I suppose, the initial effect of
a

&

CO., INC.

SECURITIES

dope on the chap who first takes
it. But, just like the dope-taking,
We

are

pleased

to

MR. LEWIS C.

announce

-it quickly becomes habit-forming,

that

requiring
we

Formerly
The

National

is

now

Vice-President

City Dank

of

-

it

of Cleveland

associated with

ess

as

can

see

work

at

past

20

called

Vice-President and

a

cure

ment

Director

same

but open our

we

the
us

ever

achieve the

WILLIAMS

Members
1612

November

UNION

1,

1051

Midwest Stock

COMMERCE
-

years.

for any




BLDG—CLEVELAND 14, OHIO

TOWER

«

1 -031 3
»

Has any soeconomic ail¬

been

proposed or signifi¬
adopted in that time span

other

than

increasingly extrav¬
agant spending, lending, or giving

E.

M.

S.

E.

PARSONS,

JR., PRESIDENT
J.

PARSONS,

D.

MOSS,

SEC'Y-TREAS.

VICE-PRES.

Exchange
*Part

BUILDING

COMMERCE

this very same proc¬
in our own land in

cantly

MERRILL, TUREEN & GO,

UNION

bigger doses to
good feeling. If
eyes and look at

•

CLEVELAND,

OHIO

fore

the

ecutive's

...

cf

an

Fifth

address

Annual

Conference

of Mechanical
Fa., Oct. 30, 1951.

ciety

/

of

by

Mr. Smith

Management
the

American

Engineers,

be¬

Ex¬
So¬

Skytop,

MEMBER

OF

NATIONAL

and

the coin and paper currency m
our pockets plus our deposits sublect to check that is, demand de-

more

has

new

an(j the only significant dif-

gutse

'S

w

the

technicalities which serve to conceaj
process fr0m the gullible,

^5^? long PvnlnftPd
inL exploited
Keynes,

Maynard
as

de-

process is where it leads despite the seducofficially conducted as an "easy tive glad-happy feeling it yields
money policy," however, the pub- for the time
being.
lie curiously fails to recognize its
even
greater
greater uecepuvciitaa aim
deceptiveness and
trPnd
of demore
widespread
Ja ;
huving uower is

-

they, of course, the we'll orand politically powerful

country today is conducted behind
? T*11 0fJiscal^ centraj bank

thus

and

bust

public

is

and

I

are

prg^ve^redetcTnowadaTto^he ag™ultural and of money in this
labor monopolies
The printing

and

govern-

have

of

theft.

a

as

j

tive means of destroying our sys- -ganized

structive,

readily .recognizes
the evil of resort to printing press
money when it is privately conducted. It is called counterfeiting

doubt that

he got some mutual' friends to

them-

eommon

cated

currency debauchery as an effec-

cans

those governed is to de

on

The

has

General's intentions and

in

the debasement of buying
is customarily measured as
the reciprocal of the average rise
in prices.
'
;
•

crack at
;.

no

certain

trends

power

-

Truman

nttle

the

on

defend

t0

the currency,

tent

long held the General in high regard and
early in his Administration, when humility
bubbled out all over him, he was quite of a mood to support the
General for the Presidency in 1948. Later, though, when election
became strch'a challenge to him, the President grew most nervous
there is

I
7

Senate, Senator Douglas
began appearing in .the news¬
The President let his displeasure

name

become known and he has lost

in

a process that
is
accomplished
exclusively
b y
"watering" or diluting irredeem¬
able
paper
money
through
its
"printing
press"
multiplication
The public recognizes the result as
price inflation and, indeed, the ex-

can have a very blunt way about him at
times,
easily visualize his asking the General point blank:
"General, what about your Presidential ambitions?"
j%
It was only a few months ago that the President turned sour

and

frauds

historically

trated

-

;

able

students of the subject and per- dowments. They

armament

to

me

dangerous

One of the most monstrous
ments

Mr. Truman

<

Macaulav

has

brings

destructive

This close friend

I don't deny this and I am not questioning anybody's
word, either. All I say is that it must have been a most restrained

meeting, indeed.

the

Dollar Debasement

high type.

a

of

the American economy.

Under the circumstances if you want to believe they sat there
luncheon, just the two of them, without politics being discussed,
you are entitled to your belief.
And I can add that this is the

me

Lord

it

and

at

explains to

by

That

And

Mr. Truman's blessing would

of his closest friends.

favor

courage

political party is something entirely else.

one

the

already begun
happen to us, no one with the
to face the facts will deny.

to

For him to be planning to overthrow this man

word of the General to

is

this

or-

nurchase

predicted'

up

the Democratic ticket with

debasement

heaviI

most

,

^be

land

our

exchange.

or

Bradford B. Smith

'to^s^^with de^astatfng^ogic

for quite a segment of our popu¬
goes permanently behind the clouds for another one.
I have always thought that the whole situation around Eisen¬
hower was an amazing one. For him to be a Presidential candi¬
date

his reward,

dollar

more
numerous
less
Zductive haPs even better known to ene- the proprietors who tend to be
the improvident or lazv
Indeed' mies of our form of civilization- borrowers more than lenders and
iuLluLenin is reputed to have urged to be owners of real property. Nor

lation; it

be quite natural.

dium

All

in

to

loss'as

that

]east

j

,

develop it

ever

bring chaos to

that
no
one,
save
possibly the
farmers, could survive without the
•exchange of products in markets
dependent upon money as the me-

and

.'thrifty

a

of

prestige and power, of their standing, in
lived in Washington you would know

sun comes

would

pro¬

ductive

a

the population has so greatly spe¬
cialized its productive
activities

.office and de¬

you

People lose jobs and fall into oblivion;
opportunities.

so

Should full flight

end-

[capture public

a

faHct

Th

medium b
end result
fQ,k

as

increasknowledge. These
| > he
le with savings de_
of incipient flight from the dollar.
positg and ljfe insurance policies.-

•

You may say this latter is of small moment to the

J,e-quarter

confi-

the latter half of last year signs

m

Jess
promises
Jo the gullible
and thereby to

-

s\rde'^ ends" up'wl'th

of

press

exchange. Of this
have already had a premonitory taste when there developed

the

make

record

of

of

and

in

redemption,

savings

a

I°r *t 10 years ago would have
then bought. As far as real things
areconcerncd the purchaser, ex-

by

money

resul?

the money

m

people have had per¬
experience. Thus the $100

many

we

.shortsighted,

•
•
"
Yet there is a movement afoot in which the General is in some
degree1 a part," to say the least, by which he would not only oust
his Commander-in-Chief from office but the
political party which

whole, the welfare of

press

destruction

is

dence

dis-

greed
Carlisle

:

a

money

worthless dollar.

a

bond will buy only
three-fourths of what the $75 paid
of

of printing

away

.

this point of view
more than half

received today on the

relaxing

glad-happy doses of printing

power-

the

envy

And

the opportunity which Roosevelt gave him has
been topped off or added to by Mr. Truman.

as

you

as

contented, t o
organize fear,

.

tunity given to him by Mr. Truman's prede¬
cessor, the leadeh of the same political party
Mr.

recognized,

dema,goguesto mar¬

this great prestige, first because of the oppor¬

which

well

was

Justing

abroad, and he is enjoying this high favor,

of

It

ity for

enjoying high favor in the

now

mind,

Here is

for

now

tSt

policy.

Get this picture in your mind:

excuse

no

dollars

Of this device for debt repudia¬

even¬

may
read for yourselves in the the government?
•10th Federalist Paper by
Madison,.
gut trie same historical
that popular
sovereignty presented indicates
the end
ine
opportun¬

He

ministration's

Sees

From

the road to

moral tenets of American civilization.

know

to

irreversible.

prove

It takes

three

and

have travelled

we

sonal

tually

meeting, indeed.
breaking bread
spirit of intimacy, he

President

to

started.

among

two

buy what one dollar used
buy
before the debasement

tion

there

♦

the

as

buy at
50%; at whole¬

to

now

ditions give hidden impetus to these trends which could

mention of

as¬

most restrained

the General sat

with the President in
knew

rest

between

the dangerous trends which threaten
our economic
system: (1) dollar debasement; (2) price coer¬
cion; and (3) tax despoliation. Says current warlike con¬

with others present and then to eat alone and not discuss what is

But if there

System

Economist, United States Steel Corporation

Of course, it is possible for two men in the
positions of Presi¬
dent Truman and General Eisenhower to sit down in conference

you

that span of time

sale it has declined 63%.

By BRADFORD B. SMITH*

By CARLISLE BARGERON

politics when they ate alone

In

retail has declined

of the Neivs

uppermost in the minds of both.

tistical fact.

the power of the dollar to

ASSOCIATION OF SECURITIES

DEALERS, INC.

The Commercial and Financial Chronicle

8

.

.

Thursday, November 8, 1951

.

(1748)

of this

A Current Line

the

on

return

Shares of Electric Utilities

plus equities that appear
about the stock

highs,

year

some

more,

find

some-

thing missing,
of

knid

same
a

the

isn't

This

bull market,

Yes,
but

still:

we

have

utilities,
United

North

Corp.,

American
Electric

and

Bond

and Share are

but

1 e
ghosts of their
Coblcigh

p a

former

selves,

selling at tiny

.

percentages of 1929 prices. They
fail also to provide any of their
old time Exchange fireworks, hav-

abdicated

ing

oils and

in

the

of

favor

the chemicals. And such

volatile speculative pogo sticks as

Investments, Middle

Insull Utility

West Utilities and Associated Gas

"A" have joined the

and Electric

speakeasy, the trolley car and the
60-hour week in the non-repetisection

tive

Of course,
ities

■.

the reasons why util-

longer

no

/•/'••%';

of history.

are

either

market

plummets

rockets

or
are found in
Utility Holding Company Act
of 1935, which, in due course, returned
the ' operating
utilities

the

back

investors

to

balls

and

removed

mostTazzlSS financial structures si lie'
corarattonswereborn ?n
them

as

for

the

some

it

is

moving up
less than 4% since Korea, they do
present elements of growth that
appear to have been widely igaverage

Si ,m.stance' ln

^f

over

growing at

$5^illion

New

Stock

annuallv

is

Further,

time
cause

seems

companies

power

good

it

will
in

today

to

me

enjoy
than

that

of the
make

good

fairly

better

than

most

also has

a

Each

unit

tax
.

,

Electricity

(3)

Ac-

duce all

all

build

thought of

as

"defense"

in
a

history, partly betheir product, electricity, is

Florida

Dividend

Yield

costs

under

a

can

give

Rate

About

193/4

$1.20

6.25%

$1.75

11%

.80

Utilities

Company

Power & Light.

24

Potomac Electric Power,,

6.70

1.40

5.85

.90

141/2

6.35

1.00
*

to

years

dividends 119

Guide—Brochure—Kidder, Peabody & Co., 17

"

tion of

share markets, and you

our

could do
a

lot

a

than/take

worse

on

current line of electric utilities.

y

Ill Broadway, New

5, N. Y.

to

major

sideration

of

industries

stocks

Walker & Co.,

vs.

and

bonds

in

their prospects and con¬
today's markets — G. H.

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

risk"

and lower priced speculative shares—
Francis I. du Pont & Co., 1 Wall Street, New York 5, N. Y.

Tokyo

type equities,

Exchange—Bulletin of spot

Stock

stocks—Nomura Securities Co.,

quotations of major

1-1, Kabuto-cho, Nihofibashi,

Chuo-ku, Tokyo, Japan.
■

*

Industries

Aluminum

*

*

Incorporated

—

Analvtical

Ami

Incorporated—Bulletin—O.

Fifth

Avenue,

New York

Copper

New York 4,

—

Analysis

N. Y.

18,
—

B.

Motter

N.

Dreyfus

Also available is

&

,

1856

Continued on page 43

Foreign Securities

Petroleum

Members

Scrip

and

York

York

New

Chicago
*

Telephone HAnover 2-5590




Exchange

Power

Board

of

'

Southwest Gas Producing
Southern

Union

Gas

Inc.

Trade

I

Primary Markets

,

'

Jong

&

Co.

NEW YORK 5, N. Y.

Teletype NY 1-1401

Cotton

Orleans

New

37 WALL STREET

Heat &

Exchange

Exchange,

Commodity
1

Exchange

Curb

York

New

Stock

Cotton

New

Serving banks, brokers and security dealers

And

other

N. Y. Cotton

CHICAGO

Troster, Singer & Co.
Members:

Exchange Bldg.

DETROIT

GENEVA,

Exchange

Exchanges

NEW YORK 4,

500

Co., 50 Broadway,
bulletin on Canadian

H. Hentz & Co.
—

Foreign Coupons

de

,

&

a

INTERNATIONAL ARBITRAGE

Albert

Associates,

Y.

Oil Developments.

Foreign Exchange

brochure—

Stanley Heller & Co.,-30 Pine Street, New York 5, N. Y.

Anaconda

Established

"businessman's '

Selected Lists of good quality common stocks;

■

2.45

-

Co.,

&

Outlook—Discussion of recent market decline with ' ;;

relation

offer the false

Haupt

Stocks—Analysis—Bache & Co., 36 Wall Street,

York

Securities

market spin like Insull
Investments common
in

1.00

and its stockholders
regularly with the exception

years ago,

1833, 1840 and 1858—National Quotation Bureau,

household electric bills!

About

fo

6, N. Y.
Trade

New

vast
Fed¬

(Ah, those
memories!) • Utilities today are an
honored and highly respected sec¬

as

their beginnings in

Street, New York 5, N. Y.

York

you a

Utility

Quotation Bureau Averages, both

Stocks—Review—Ira

Retail

So while Con Edison may never

Earnings

About

South

Southern

Rail

on

Per Share

Price

Middle

Wall

facade of lower power rates.

steady demand for capi-

ancestry

Preferred Stock

basis; that only by

their

.

Inc., 46 Front Street, New York 4, New York.

job

producing cheap electricity
nationwide

eral power projects

ater!
here

a

Discussing factors dominating

Co., 115 Broadway, New York 6, N. Y.

of the years

vate, and heavy tax-paying, util¬
whale of

—

stock with interesting assets value—J. R. \

common

started paying

citizenry that pri¬
a

Letter

Investment

have received annual dividends

power is still a problem or a
threat in many areas, it is slowly

done

Charts covering

of the

eral

have

—

on

before the Civil War and another
1900 or earlier.
Twenty-three 1
companies have been paying dividends continuously
seven to seventy-nine years.
Of the other twelve, one

their

logical, justification
price or rate increase as the
electrics.'; V;".
(5) While competition with Fed¬

ities

Chart Book

payroll periods based

low-price

from

on our

Withholding

the "exact computation"
"percentage" method of calculation—Manufacturers Trust

nine had

or as

dawning

Tax

Income

.yield and market performance over a 12J/2-year period. Of
the 35 companies represented in the National Quotation Bu-1
reau's Over-the-Counter Industrial Stock Index, 12 trace •

pror

for

on

and

Stocks—Laird, Bissell

parison between the listed industrial stocks used in the DowJones Averages and the 35 over-the-counter industrial stocks

(4) Few industries can present
good,

*

Over-the-Counter Index—Booklet showing an up-to-date com--

securities.

as

Wall

Stocks—Third quarter comparison

Bank

17 New York City Bank

Williston &

1929, it is also unlikely to jolt you
shares, from time to time,
with a margin call more costly,
Another thing, the average yield
on a single day, than a lifetime of

their

Company

/

atoms

our

1

market;,implications of the new tax bill; earnings
and dividend outlook for 1952; the era of electronics; and a

de¬

to

Co.,

Kidder &

the stock

excise

don't

M.

Co., New York^l5, N. Y.

airplanes. Too little have util¬

ities been

City

of

used in the National

vital

we

York

November

aluminum and copper

our

don't

—we

and

is

it

t

Meeds, 120 Broadway, New York 5, N. Y.

.or

they've been lugging.

fense—without

tal which gives promise of attractive subscription rights to new

any

sec¬

top 6% on
And they gain by

repeal of the 3 V2 %

recent

Earnings—Analysis—A.

standard

they

of^neY' earrdne? Yd dividends
industrial).

&

1951

(2) Tax-wise utilities are pro¬
profits taxes

fair valuation.

...

.

N. Y.

analysis

tected against excess

Exchange;

(against about 43% for the

New

case

should go down.

until

...

in chemical

Snell, Inc., 29 West Fifteenth Street, New

Street, New York 5, N._ Y.

past year, it's possible

a

•

hiding

wider

at

Industrial

big sell-off. Not having gone up,
there's no special reason why they
•

il, N. Y.

the elec¬
a splashy

although

monthly

Earnings—Bulletin—Dean Witter & Co., 14 Wall Street, New
York 5,

and

showing

prov¬

reject the Dow theory of

nor

cloud of tax exemption,

~:\r.age

York

appointed

tern of dividends for the electric

t4risye°ther maj0r £ieldS °f en"

matters—Foster D.

ince of utilities is neither to con¬

earn-

listed

the

Although

..

charts

issue—1001

Chemical Digest—Bulletin of recent developments

tions of the market, if we have a

stocks

York

a

of industrial America.

themselves

listed below
of companies operating in expanding zones of juice buying,
the

how you're going
a better selection
Gas and Electric,
solid belt in the heart¬
see

with

up

•'

■:

November

120 Broadway, New

Co.,

&

Bros.

'

highs, lows, earnings, dividends, capitalization, and volume
on
virtually every active stock listed on New York Stock
and Curb Exchanges from 1940 to November 1, 1951—single
copy (spiral bound), $10.00; yearly (6 revised books), $50.00.

for
them along the following lines:
(1) Supported by good earnings
and
dividends, they can defend

tne rates ox earn
*inancial structure somewhat standardized, there is a
wide difference in growth of sales
of electricity, dictated principally

are

power

5, N.**Y.

Charts—New

American

serving

.

All of these shares

come

land

ings and

common

one

than

ket

lasf

velocity unmatched

a

to

to

all sell at relatively low timesHmihlpr?nviv ««wu7® earnings ratios, with Florida at
h
k ni!
t
0n ^aS rouShly ten times earnings, Midhlll sinrp the
here since ihP L p?wXif?" dle South and Southern a little
fnnd£ World War over n times> and Potomac 14
romnaniet now running
+
fimes. All fit into a standard patrate

want

list, I can't

losses—Sutro

and

York

So if you only
utility in your

only last April).

generally

really watt-hungry.

gains

(a l-for-15 stock extra was given

markets,

surely true that in cordingly, investment-wise, among
market, electric the most attractive current values

namics, their

with

steadlly '"creasing power demand

are

only about 5.20%; but
this equity is dotted
stock dividends and rights

yields

the history of

upward surge in the roaring mar¬

current

our

shares have not produced any dy-

Capital Gains Tax Provisions—Bulletin on method of computing

it

de¬

be

to

little

leaves

holders

sired.

trics have failed to make

f
For instance New
E"gland companies are creeping,
v" west whlle he South and Southal°"g

While

ing $4.40) and selling around 57V2,

manage¬

above
average
earning
and its treatment of share¬

power,

firm

which a

Securities—Anal¬

Currently paying $3 (earn¬

wonderful

demonstrated

of thumb formula, sets the pat-

are

Street, San Francisco, Calif.
Capital Gains Possibilities in Non-Dividend

and

Electric Bond

ysis—Hill Richards & Co., 621 South Spring Street, Los
Angeles 14, Calif.
With special reference to Glass Fibers,
Inc., Ilugoton Production Co., Transcontinental Gas Pipe
Line, Suburban Propane Gas, Texas Eastern Transmission
Co., Canadian Superior Oil, Consolidated Engineering Corp.,
Telecomputing Corp., Tennessee Gas Transmission, Delhi Oil.

ment,

e^t companies. This effective rule

instances. Now, if we want to see
pyramids we go to, Egypt—and
that is quite as it should be!

Basic California—Brochure—Bank of America, 300 Montgomery

system, it has consistently

Share

jty equities would surely be more
intensive applications for improved rates.
Another ^actor favoring utilities
is the standard pattern now for
their financing. Custom and practice now favor ; 50% m debt,
around 20% in preferred and 30%
in common (and surplus). Thus
if is easy to analyze leverage fact°rs> and, in general, to compare
earnings and growth among differ-

of

following literature:

best company

be the

of the

wether

is bound to appreciate
everything from beef

rates

send interested parties the

to

this ermine electric was the bell¬

bungalows has been making
new price highs. Thus it is that
electric companies should now be
in an excellent position to obtain
reasonable rate increases today.,
Such increases are vitally needed
for the proper growth of these
companies; and to offset the increased costs of labor, taxes, and
new generating capacity.
Regulatory tradition has usually accofded power compaines a 6% return on fair property value. Well,
for many companies that return
has been slipping lately—for 1950
(industry wide) it was just a
shade, under 5%. So one thing to
improve the present value of util-

Evm" wffl^the

understood that the firms mentioned will be pleased

It is

Going back to the days when

tric.

tfrn/?r .utility

Recommendations and Literature

of the lot—American Gas & Elec¬

to

century,

and

U.

shares,

one

of us, whose The public
back a quar- that, when

ter

and

fine,

are

real kind word for what

a

believe to

I

undervalued.

market memories go

Ira

without

of the very few things that
market hitting 21- cost less today than 10 years ago.
hoopla

What with all the recent

four

ingratiat¬
ing prices, I never like to leave
any discussion of electric shares

explain the market lag of electric power

attempt to

these

While

available to you now at

COBLEIGH

growth factor in this industry; some

Brief treatment of the

Dealer-Broker Investment

earning

expanding

power.

"Expanding Your Income"

Author of

par¬

money,

on

ticularly when so well assured by

consistently

By IRA U.

is 6.28%—surely an

group

attractive

74

N. Y.
PITTSBURGH

SWITZERLAND

N.

Y.

Security

Dealers

Trinity Place, New York

Telephone:

HA

2-2400.

Teletype NY

Private wires

Association

6, N. Y.
1-376;

377;

378

to

Cleveland-Denver-Detroit-Los Angeles-Philadelphia-Pittsburgh-St. Louis

Volume 174

m.

Number 5062

The Commercial and Financial Chronicle

Automatic

(1749)

Fewideaowners realize how long it takes to develop
car from the dream stage to a working reality.

driving is

an

The automatic drive is

typical example. More than
General Motors began to seek a new,
simpler, smoother way of transmitting power from
a

25 years ago

out of this whirt

a

g

engine to wheels.
First it

was a

discoveries

subject of long research in which new
made about the behavior of liquids

were

in motion.

j

Then GM

engineering took over, translated labora¬
tory developments into scores of working models,
weeded them out by many brutal tests to find the
most
practical. Finally GM production units worked
out
ways to manufacture them at low cost, to give
you the automatic drives available on all GM cars—
Powerglide, Dynaflow, and Hydra-Matic—plus
heavy torque-converter drives for buses, military
vehicles, and construction machinery.
This is

a

cycle that

never

stops at General Motors—

every phase of automotive advancement, from
fuels to finishes. That is why the key to any General

on

Motors

Getting

a

THAT MEANS VALUE.

precision assembly like

an

is

your

key to greater value.

Key to better engineering

Key to better manufacturing
ACHIEVING VOLUME

car

automatic drive

from laboratory to production line calls for high-speed
methods of making them at low cost. Typical solution:
this automatic 18-station drilling machine whose
infallible electric fingers help form 108 transmission
pails an hour with super-precision. Such equipment
brings automatic driving to GM car owners at reasonable cost-and gives GM vital skills for defense work.

TESTING ON THE TOUGHEST HILL OF ALL:

automatic drive is put into production,
GM's engineers test it on Pikes Peak—almost 14 miles
Before

a new

YOUR

GREATER

GENERAL

of relentless 10% grade and hairpin turns. The summit
is 14,110 feet above sea level—which cuts horsepower
in half. Here they test the newest automatic drives—
in trials more wicked than you could meet in usual
motoring —and make design improvements before
manufacturing takes over,

KEY

TO

VALUE—THE

KEY

TO A

MOTORS

CAR

DEFENSE IS

Hear HENRY J. TAYLOR

on

the air
EVERYBODY BUSINESS

every

Monday evening

over

the ABC Network, coast to coast.

★
TRANSPORTATION IS

^tvtKYBQor's Mtcessnr

Gemerajj Motors
"MORE AND BETTER THIN9S FOR MORE FEOFLE"

CHEVROLET




•

PONTIAC

•

OLDS MOBILE

•

BUICK,

•

CADILLAC

•

BODY

BY FISHER

>

*

BBC 1RBCK ft

COACH

The Commercial and Financial Chronicle

JO

were

Political

Expediency Should Not
Motivate Foieign Policy!
By IIENRY FORD, II*

and

peace

protected by two
it has been our American
people

a

remedied

oceans,

to

sible

affairs

pos¬

political

the

with

do

the

of

the

of

rest

world.

of the

—

factors

Thursday, November 8, 1951

.

may

which always
waste and confusion, has
practice,

than

in the classic remark of the French

they

political leader who looked at the

are new

to us.

marching mob outside his window

an

and

have

age

of

ence,

result

Henry Ford, II

Yet

—

fellow

our

now

are

we

boiling pot of polit¬

involving races of

ical

problems

men

who don't talk our language,

who don't believe in the things we
believe in,
toms

seem

people;

whose habits and cus¬
to us incomprehensible

which

true and sound and re¬

flect

the

very

"raise

us.

George Washing¬

standard

a

wise and honest

the

which

to

there is little value in
criticizing each other in times
I

must

record

leaves

years

of

the

with
feeling

leaders

our

few

nast

the
that

me

uncomfortable
many

however,

say,

of

very

too

motivated

are

in other

largely by political expediency

mon

we

parts of the world. Com¬
words—capitalism, for in¬
stance—are used in other parts of
the world to describe substantially

enter the road of

pleasant if we could

and

leaders

can

national

we

which have

I

Our national

only do in

situation

our

but

statesmen,
can.

inter¬

any

those

things

public support.

policies and programs

as a

Our

nation

depend—as they do in few nations
—on public opinion.
Of

course,

there

are

two ways

of looking at this basic fact.
to

that

assume

leaders

should

watch
•,

*An

address

our

waves

-i' v'. ; '■

a.

■

Ford before the
of the Asso¬
Massachusetts, Bos¬
ton, Mass., Oct. 25, 1951.

36th

by

One

national

the

anniversary

ciated

industries

Mr.

meeting

of

new

as

in¬

they

as

This

to

seems

of

record

me

our

budgeting $57,armed forces.
pared down from

and

was

had less than

we

half

a

for defense.

We

came

apparent

in

million
Some

people in the Pen¬

tagon said they needed an armed
force of 3,500,000 men.

suggest

ought

we

They now
raise that

to

One

hardly blame

can

If

men.

they

ask

you

mili¬

our

generals

ask for all

Believing these things with all

heart,

my

But

of

I

over-simplify.

may

and

sense

confusion,

logic in

here

our

of

some

are

my

I start with the fact that we are
a

its possessions.

or

abilities

own

he

as

his idea of happi¬

pursues

have

We

faith
incentive,

that each human be¬

so

brought about in

The record makes it

that if

me

learn

our

people

as

are

going

ship.

road

new

have

We

from

to

those

lot

a

the kind of give-and-take of opin¬
ions that Will lead toward a na¬

based,

not

fear

of

hysteria,

but

You

well-calculated

and

long-term

our

I—and

and

on

en¬

.1 '

the

other

155

for

have

we

relatively short

a

human

world has

that

living

And

seen.

ever

are

nation to

get

"We

cut to

the

fact

power

people

Clearly, it is
to

us

try

who

that

dared

Soviet-dominated
to

start

marching,

committed this country to an ex¬

peditionary force

for

which

did

we

up

best to understand

our

notes.

pare

make

time for each of

a

what it is all about,

leaders, correctly interpreting the
anger of American people over

Primary Markets In Over

and to

com¬

One of the wise things

during

1951

to

was

get

is

clear

that

have

we

is not

enemy

an

an

think that
people
anywhere else in the world want
people

Russia

of

or

Vrv'

■

Our enemy is a

relatively small
crowd of experienced and unprin¬
cipled demagogues who, at the
moment," have
complete
power
over

the people of Russia and sev¬

eral

other nations—a

I

we

and

say

make

up

the merits of the

hope,

therefore,

seem

minds

our

controversy.
that

it

will

strange to you that

an

West,

state

who
his

on

all

the

his

to

just

job, should

to

way

views

know

has plenty of

own

Boston

subjects

on

be expected

can

about

to

con¬

as

much

as

average
informed American
citizen who reads the
newspapers
and listens to the radio.
A

So
not

far

war

can

I'm

as

want

that

for

us

to take

to

lead

concerned,

I

down

go

road

only to

any

do

Total

war.

solve nothing, and it

can

can

tant

to

that

all

of

another

us.

I

do

World

not

War

think

is

in¬

evitable—not by any means.

offers

the

Broadway, New York 5, N. Y.

peace

and

away

chance

maximum

of

main¬

degree

of

in this world-^however hard

costly that

want

PHILADELPHIA

best

to

take

a

road
road

may

which

be.

I

leads

to

on

^'

••

men

propose

to

possibly can, and to that end are
always searching out, and exploit¬
ing, what can be made to look
They

ruth¬

war.

like

Soviet Russia.

.

than

keep

shorter

a

think.

we

can

Personally,

for

No

absolute

police
control

hundreds of millions of
peo¬

over

ple forever.

Every dictator

who

has

strutted
down
the
road
to
ruthless power has found that out.
The question is, what should the

people

of

America
there is
is

the

do

road

a

United

about

States

of

this?

"Surely,
road—surely there

wise

a

that

and

courageous

determined

people can take. :
In its simplest
terms, the answer
to be this:

seems

national

is

have to

we

to go armed.

The

If such

bandit

inter¬

an

loose

the

on

travel, we've got

No question about it.

only

enemy

rest

his

upon

we

ruthless

If

power.

check-mate the

can

threat of

that power, we can
keep open the
road to world progress.
How

big must

armed

our

might

be to do this?

How many men do
How much armor? How

need?

we

air groups?
are
important questions,
military strength we

have to

maintain for many years.

What is required is
and

staying

power

steady determination.

r;

.

Full Mobilization Not Needed

Apparently
not

full

a

what

country—not
Soviet

Union

is

this

force

to

against the

war

but

—

of

sufficient

always ready to meet force

power

in

needed

armed

an

in all-out

engage

is

mobilization

limitejd areas, plus the ability

to mobilize

that

rapidly if the need for

should

The

develop.

ever

American

people do not
great military power.
Military power is a sideline with
want to be

All

us.

tary

a

the

mili¬
of

promise

to come if it should ever be

make

needed—to

by

is enough

want

we

power—and

more

an aggressor

world

nation

conquest

a very

bad

risk.

is

'.

1

■

-

1

t ■jl

need, in other words,
position of strength that will

a

we

national

Of course, that is ridiculous. As
free Americans

know that only

we

when nations and individuals

free

from

fear

or

is

war

sible to them to prosper.

be

to

steel

are

pos¬

As busi¬

know that every tank,

battleship,

every

it

that

gun

every

is

made

much

so

less

for

buildings, automobiles,
dishwashers, bridges, electric
power—even

nessman,

and

means

destruction

for.

To

razors.

war

••

of
.

busi¬

a

only waste

all

he

works

.

Actually, Stalin knows this and
exploits it.
his

sends

When, for example, he
to

troops

maneuver

crafty motive is to force the
ple

of

Greece

to

turn

on

of his
peo¬

from

the

reconstruction of their country to
the

thankless

task

of

guarding

their mountain passes. Thus,

Stalin

a

loving"

to protest

same

make

Soviet Union and at the
he is able actually to

time

war

on

the

economy

of

tension over night.
It is
job that is going to have to be

done

piecemeal, keeping all chan¬
negotiations

nels open for realistic
and

honest

to

be

ent

efforts

It is

peace.

to

achieve

job that will have

a

worked out in many differ¬

ways—from

other countries

Nations

cooperation with

through the United

the

to

diplomacy all

most

over

alert

U.' S.

the world.

Now

as
I say, I have no
way
knowing how much is enough,
but I have a strong hunch that
too many people
making the deci¬

of

sion

about

our

own

armed

might

still be chasing after the fear
hysteria that followed the first
may

alarming setbacks in Korea. They
look as though they consider an¬
other
want

world
to

war

inevitable

and

be

ready for it—instead
thinking in terms of blocking

of

attempts at aggression.
When the American
people have

accomplishes two things: he is able

are

men

capable of building for themselves,
if they are left free to do it.

be

may

you.

the

better kind of world that

time

that

say

of

Tel.- LOcust 7-2400

natural

"capitalistic enable us to
keep our self respect
and me and move forward
without fear—
promote war to make profits. As a
position from which we can pick
a
result, millions of people all
up our international problems as
over the world are half-convinced
they come along and deal with
that we in the United States have
them one by one. For it is wishful
dreams of world empire and are
thmking to suppose that some
itching to get into a fight with miracle is going to dissolve inter¬
even

businessmen"

that Greece is planning
to make war on the great, "peace-

hysteria and toward

strength

of

areas

long time.

a

it

What

of wanting

accuse us

and

waves

military

land

-

be

hope

part.

our

from constant tensions

1421 Chestnut Street

by

up

.

on

the borders of Greece, part

I do want to take whatever road

taining the

hang

extend their power as far as they

has

destroy everything that is impor¬

Telephone: WOrth 4-2300

'

they

power

and

We know these

nessmen, we

today in international affairs?

Investment Securities

force

Iron Curtain.

an

;

by

They

on

What is the road

Incorporated

For it is the

How long we will have to reckon
with this enemy, no one can know.

Russian people. ! do not

our

Affairs

J. ARTHUR WARNER & CO.

no

lives and

our

These

idea,
because free people are not afraid
of ideas.
That enemy is not the
That

enemy.

like weaknesses

The Road to Take in International

CoasMo-Coast Wire Service

fact

a

make

because it is

Enemy"

An

the MacArthur controversy out in
the open where we could all have

the

400 UNLISTED SECURITIES

value

we

great

many

with the job.

on

Have

by ruthless police methods behind

Our national

should

we

resources..

the

we

always full of hope and determi¬

war.

and

a
continuing
appraisal of

pro¬

the rise and

on

in

lution

the

national

a

people,

period of time the greatest revo¬

It

public discussion—

policy and

world

better

a

free

a

to

leader¬

going to need

are

of responsible

be

As

going to

are

have delegated

we

We

to

facts

more

whom

this

borders, the American

better informed.
need

/

clear

nation have

a

travel

to

outside

we

arise.

seem

an

toward

ing to get exactly the kind of so¬
ciety we deserve and work for.

Korea.

of

economy

language that. this
talks is the language of
atom of explosive strength. His chances for success

in

do

which conceivably might

force

what
giving men

shown

already

can

„

backed

road

'

ness.

this

thing

ambitions with

and

all.

to

We are a revo¬

We believe that
nothing is so important as the
individual human being, and that
he should be free to develop his
lutionary people.

seized

■

same

cunning enemy of every¬
we
hold dear, and it is

state

views.

own

ing to do with war and to get on
with peacetime progress. In 1948,
the budget for defense had been

came

the

on

freedoms.

our

I

American public opinion—are go¬

Then

and

the

deadly enemy,

a

mistake if

It may

million

in 1950.

industries,

making

war

is

threads

anxious to forget everything hav¬

$11,000,000,000. It was $11,900,000,000 in 1949; $12,300,000,000

is

which

about

present

I try to sort out the

as

combination of circumstances

they can get.

cerning which he




men

ing becomes

of World War II

Trading Department Maintains

LAfayette 3-3300

frightened

After all,
their job is to be certain that this
country can be victorious in any

come

!' Devonshire Street

who have lost
faith in themselves and in people.

for defense,

quite naturally going to

are

problems

.

up our

minimum interference from others

figure to 4,000,000.

lightened self-interest.

•,

out

a

in uniform.

men

months ago the

Middle

BOSTON

give

in the world to the United States

fall

appropriations

two

were

automobile manufacturer from the

Main Office-120

to

$104,000,000,000 that our mili¬

In 1948

not

Our

never

tary experts originally requested.

this

And

gram

the

in goose-step.
I will
buy the idea that we have

road

any

of

This

to travel

be persuaded

its

his

if

as

countryside

this country.

price.

I cannot

peace-loving people without the
slightest desire to add another
square mile of land area anywhere

tional

Defense Appropriations

leave international affairs to

don't think

our

ternational responsibilities.-

different ideas and systems.

politicians

same

000,000,000 for our

to

repair."

can

I suppose
our

the

us are uncommon

best that is in

In the words of

that

It would be

the

much

ton, they deserve leaders that will

pliment by considering ours just

commonplace to

because

are

these.

things

wise

are

of

courses

they

like

incomprehensible.
We
forget that many

elements

world pretty

our

up

how much they need

deserve

They

—and who often return the com¬

as

my

political expe¬
leadership

more

upon

action

know
a

go

that will lead them to

dealing with

thrown into

make

political

based

accustomed to

we
Americans.

which

today—with

tary

diency.

We are

people

the

of

most

that

is

people deserve a
better kind of leadership than one

me¬

at any

kind

and

The American

chanical inge¬

nuity.

"There

said,

I must follow them."

in
of sci¬
up

do not want to tra¬

road that leans toward peace

its

Soviet-inspired action in

he

Korea,

,

Of course, I
a

with the

surely

as

waste

bombed

and

of

mili¬

getting huge sums for

that Americans will accept
only in the face of the clear pos¬
sibility of national disaster.

stand simply

We

religion, or na¬

just

laid

less and

as

omy

they

better described

matter what their
or

Lrreece

army

liberty in order to
save our liberty. Such talk always
sounds to me like the frantic talk

as

the

been

road that

a

ting the kind of controlled econ¬

because

is

.

tary expenditure; asking and get¬

in

never

hard to under¬

grown

opposite direc¬
possible—asking

the

in
fast

want

greater opportunity

color,

or

tionality.

years ago—we are

brings

therefore

are

wherever

race,

national

our

I

means

toward

for all men, no

at whatever

—

opinion,

public

That is the old business of
political expediency—doing what
may at the moment be the politi¬
cally smart thing to do, but what

age-old

face today

be

That

leads

vel

and

go.

may,

Many

we

promptly

the long run, turn out
to be very unwise indeed.
That

tradition to have as little as

situation

the

cost.

tion

progress open.

them

with

retreat, they

and

that

demanded

moving

public opinion and ride along

of

reporting those early

of defeat

days

The

As

poorly equipped, indeed.
American people saw

leaders whirled around and started

kind of leadership
than that based on political expediency, leading industrialist
urges public be better informed on foreign and domestic situa¬
tion. Says full mobilization is not now needed, but we should
have sufficient power to meet force in limited areas, plus ability
to mobilize rapidly, if needed. Condemns "fear hysteria," but
keeping road to

the

the headlines

of

Asserting American people deserve a better

urges

very

When

Jumping aboard the bandwagon

President, Ford Motor Company

,

>

.

(1750)

to

dig

out

taxes to let

$57

billion

peacetime

of. their
our

for

pockets

the

government spend

defense

in

one

they deserve to
Continued on page 20
year,

Volume 174

Number 5062

.

.

The Commercial and Financial Chronicle

.

(1751)
produce

The Investment Club Movement

results

the

over

'•

results

You

can

are

the longusually superior.

appreciate,

I

decisions

They

believe,

Investment Clubs Trust

Ilead, Investment Research Department,
Watling, Lerchen & Co.

"know-how"

in

,

uniso.i.

and

of Investment
ment

club movement.

club

and

their

national

convention of National Association

Describes organization of

investment

operations.

of

Investment

not

be

Clubs

at

Oct. 20, 1951

on

and

De¬

vidual

to

possibly it will
much

ado

over

time

any

America,

this

local

business

issues

the

indi¬

community.

during the first

year

existence, and the majority of

these

in the category of small

are

render

monthly;

will

call

wish' to

tion

as

and

amount

inquiry.
is

invested

in

fhe

large

ac¬

not concerned with market move¬

cessful

ment,

ties

of

G. A.

so

Nicholson, Jr.

"keep

\

bull

men

,.

and women of all
ages and cir¬
cumstances, it has, to say the least,

as

the

potentialities

a

vast

influence.

What

The

is

.

.

each

who

month.

congenial,
meet

usually has

invest
The

$10

are

looking,

and

month in their homes

a

They discuss

the topics of the day as it relates
to their immediate business of in¬

vesting

,

is

not

club

in

back

in

$10

many

years.

Washington,
month,

a

D.

has

C.

big

a

dinner, and if there is any money
left over, buys a speculative stock
pn
which they hope to get their
back.

money

value

of

With

the

shrinking

the dollar, their task,

it

be

interposed, is becoming
increasingly arduous. Other clubs

may

fiuy mutual investment funds, and
trade the market for

ome

term

the

short-

profits.

The one on which
investment
policies of
Na¬

tional

Association

are

modeled,
principally in securities of
enjoying above aver¬

invests

companies
age

rates of growth. '

v

v';:

or

men

to know

who

women

are

wish

how to invest and desire

might

be

icance.

are

composed

men

seeking to broaden
security and enhance their
opportunities. On the latter score,

the history of opportunities

pro¬

vided club members to better their
status in life has been
thrilling—

capital for .venturing into business
chance at

a

a

knowledge that helps

better job;

a

person

to

Increase his usefulness.
There

three

are

major benefits

In

v

at

they?

are

the

the

build

first

up

they

eleven and

let

a

look

us

member.

substantial

a

as

grow

They
body of

older.

After

half years of opera¬

tion, the Mutual Investment Club
of Detroit, starting with
$70, has
paid in by

now

about $10,000 and

has assets of $31,000. Each mem¬
ber has a reasonable prospect of

having

his

industry

and

and

savings
forward

said,

interest

in

the

Communist

hands.

If

more

forceful charac¬

The experience of dealing in

*Frcin.an address

.Convention

20,

It is

Association

respective

intention

with

the

ment

to

visory

those

investment

board

well

This

on

to

industrial,

May

move¬

American

have

you

three

years

would

with

it

con¬

character
•

in

of

of

the

members

this date.

about

the

Revolution.

100,000

from

mean

truly

500

That

clubs and

financial, 5,000 members in Michigan alone.
May
fondest

;
;

you

succeed

beyond

expectations.

your

:

-

I

With Waddell& Reed

■
.

in

movement

is

and

background whose

movement.

roots

clubs

tradition

breadth of experience and abilities
can contribute
substantially to the

The purpose and program of the

invest

dynamic

is

the ad¬

men

to

grass

investment

out

It

enough

fidently and successfully.

connected

club

places

only

educational

or

carrying

purposes.

of

award

outstanding

in

>\

There is, to be sure, a
crying need
for more people who both
understand business and know it

to assist the Trust and
in

fitting, indeed, that Michi--

today

up

An

years

their

set

to

truly

a

stability to the
advisory
board
developed over the next

be

the

been

are

oping
a
mass
educational
and
investing project which can play
large role in this nation's future.

now

financial

the

in¬

performance

cases.

has

few

Purpose of Program

of

by Mr. Nicholson

National

Clubs,

This announcement is neither
v

,(Special to The Financial Chronicle)

(

KANSAS CITY, Mo.—Arthur L.

Williams,

II,

is

with

Waddell

&

Reed, Inc., 1012 Baltimore Ave.

investment

club; movement

through

with

foresee

its

local

normal

industries.

in

capital

U

I

financing

needing

Rights, evidenced by subscription warrants, to subscribe for these shares
by the Company to its Common Stockholders, which
rights will expire at 3:00 o'clock P.M. Eastern Standard Time on November
have been issued

can

19, 1951,

let

to actual

is

turn

us

for

Subscription Price $100

investment operations—
has to be done to

practical

a

success

are

of

a

Share

During and after the expiration of the subscription period, the several
underwriters may offer shares of Cumulative Preferred
Stock, 1951 Series,
at prices which will not be below the
Subscription Price set forth above,
less, in the case of sales to dealers, the concession allowed to dealers, and

club.

principles to

these: (1) invest money
more or less without

month,

not

regard to the market outlook, be¬

than either the last sale

more

(2) reinvest all div¬

immediately because

or

the current

offering price of the Cu¬

mulative Preferred Stock, 1951 Series, on the New York Stock
Exchange,
whichever is greater, plus accrued dividends, if
any, and an amount

this tends to produce a low

average cost;

a

moment

a

what

The ideal investment

fully set forth in the Prospectus.

of
as

"V-I,/v

Now

as more

.the

little

as

Company, Incorporated

Convertible prior to December 1, 1961

.con¬

requirements

$10,000.

idends

>

thus

the

instrumental

each

of these Shares.

(Par Value $100 Per Share)

f

day when investment
clubs and ;their members will be

follow

.

any

'

insure better competitive con¬

make

1
buy

4.50% Cumulative Preferred Stock, 1951 Series

private enterprise loses much of
its vitality and flexibility.
The

that

solicitation of an offer to

offer is made only by the Prospectus..

Air Reduction

agent of the American
industrial system—is reduced and

cern

nor a

248,805 Shares

catalytic

can

offer to sell

an

The

v

;

long-term

equal to the Stock Exchange commission.

money

terly; (3) invest only in growth
type securities where the rate of
sales

gain
of

excess

be

to

appears

10%

well

compounded

Association

Detroit,

1951.




Mich.,

at

of

Copies of the Prospectus

in

as

may be obtained from only such of the undersigned
legally offer these Shares in compliance u ith the

may

an¬

securities laws of the

nually with good prospects for
continuing another five years.
Sales

of

individual

issues

MORGAN STANLEY & CO.

upside opportunities
small and

appear to be
the down-side risk has

bear market is

usually welcomed because it
mits
in
are

the

club

securities

to

obtain

where

favorable.

the

Great

bargains

emphasis' is

price.

While these principles may

a

,

incorporated

UNION SECURITIES CORPORA TION
*
4
„

BLYTI1 & CO., INC.

Tf

HARR1MAN RIPLEY & CO.

r

7

THE FIRST BOSTON CORPORA TION

'

DOMINICK & DOMINICK

GLORE, FORGAN & CO.

GOLDMAN, SACHS & CO.

LAZARD FRERES & CO.

SMITH, BARNEY & CO.

statistics

on

buying at

'

per¬

placed

Oct.

respective Slates.

are

made from time to time when the

club

fluctuating securities through good

.Investment

;

few

fund

combined

association

gan, a state which has given mass
production to the world, is devel¬

located

are

have

are

and

men

representative of the best the state
has to offer.

this

possible
minimum.

a

this

the

the .ownership of
is concentrated in a few

-

ter.

a

finally,

become too great. Each bull mar¬
$50,000 to $75,000 at the ket
usually permits the taking of
age of 65. Self-control, developed
profits
where
issues
have
ad¬
by investing $10 to $20 a month, vanced
too far. A
a

down investment
all but

■

•

the

to

who

women

form

and

:

.worth

nurtures

give

will

suc¬

club

trust

movement.

companies
Over-active
to

Michigan

devel¬

perhaps 100 clubs

others the ad¬

grows faster if compounded quar¬

place,

individual

capital

local

be

capital is readily available to large
enterprises only, competition—the

cause

to the investment club movement.

What

long-term basis.

industry
hands, or where only big business
has access to the capital
markets,
there are
great dangers—politi¬
cally and economically. Concen¬
tration .of
industry
plays
into

their

.

a

reduced
are

to

and

Where

businesses

Other clubs

to risk

to

sized

trading is detrimental

that
this movement has national
signif¬

equity

or

on

moderate

and

extend

Significance

;

It

Women.
older

to

the

can

.

to accumulate capital. Some clubs
are
composed of both men and
of

imagine
that

progressive

ditions

The members of most clubs
young

soundly

are

perhaps

important is the fact that
have been through
good

represented

en¬

In
be

can

There

this;

Movement Has National.

dates

One

to

looked.

-

puts

A

investing in growth securi¬

of

part

immediately.

for

opportunities that
they
themselves
have
realized.
Numerous areas of

seek

will

added.

are

principles it is
to use. They also feel
obligation to do this work in

some

from coast to coast.

ma¬

record of

to
the

on

There are few rewards to the
looking people in these clubs and Association is to put as much re¬
officers and trustees of the Asso¬
their families.
The
impetus 'in
sponsibility on the club members ciation other than the
terms of jobs and community de¬
satisfaction
as possible.
In other words, it is gained from hard work. To some
velopment should not be over¬

are many types of invest¬
clubs in operation and their

history

a

learn

a

Invest¬

necessary

county

register active clubs in

movement

as

capital

available

^ There
ment

difficult
of

the

of

in

members

through the education

apiece

members

Joneses"

to

will have to have

and

in existence and
these

security with vesting because it does not pro¬
the
desirable
educational
they would duce
security like U. S. Steel. values and because it would cut

name

made

ten

The

attempt

the

oped

unlisted

an

amount

club?

with the

up

market.

buy

they

much confidence

It

forward

once

a

.

place of business.

or

wielding

investment

an

typical club

members

of

to

do

nor

are

movement,

states

way

investment performances of clubs.
gain qualification, counsellors

the

participa-

all

To

cures

The clubs

Mutual

men

order to

deavor to

com¬

contribute

various

subsequently to

states,

terially to educational aspects and

investiga¬
Only a small

should

The

will meet

although the Association

quali¬

munities

the

and bad times and have
firm faith
in the investment

It is the present in¬
tention to go
slowly in developing
the Association in additional

The

fying counsellors in various

these

will,

quality performance

interesting

The project of

(not the Asso¬

,

over-balanced with

reasons

the most

of the clubs.

letter

along to others.

pass

main track.

national companies.

n

minimum and

to

several

today, elect
Michigan directors

and

club

quarterly reviews of portfolios are abuses
designed to keep the clubs on the There

se¬

tio

attention

this

vantages

the

growth situations that the various
clubs have been able to find and

and

many

keep

information

that

proven

elect their officials. The
objectives

slightly in the light of experience.
The

Trust

now

of

of these officials will
be to expand

really valuable services.
may
have
to
be
raised

These

done,
tive

a

the

members

practical.

officers.

groups

made

This permits first hand

has

one

produce- fees and dues to

to

in

and

Asso¬

to

has

Clubs

national

■■$5,000x0 = 0.
investing.-

clubs

extent,

ciation) is

make

The National Association of
In¬
vestment

way:

interested

to

states

Experience

to

to moderate-sized local businesses.

the grass roots
of

12

of

of

out

grows

tends

stability

the

own

analysis.

encouraged

concept is

equation may be

an

this

how

on

In forming the National
ciation, an attempt has been

sufficient to withstand ad¬

the

in

movement

a

of

The club movement has
very defi¬
nite contributions to make.
Club
members are encouraged to invest

be

about nothing.
But

times

free lecture

Such

So much for

versity and yet maintain a defi¬
nite faith in the future.
Next let us examine the benefits

may

Quite

out to

bad

emotional

many

turn

Association

one

expressed

has

by

known

years.

investment

an

movement

outlines plan of
Investment Clubs Trust.

troit, Mich.,
for

Says

significance, and

The
significance, if any, of the
founding of the National Associa¬
tion

with

invest.

final

own
investigations
of ment Club of
Detroit, but this pre¬
industries and check their ponderance will
become less as
findings with their counsellors. new

period of years.. Too many peo¬
ple try to match $5,000 of capital

Clubs, Mr. Nicholson reviews history of invest¬

are

the

II

local

a

Sounding keynote for first

in

their

how sound it is to accumulate
your
investment capital and investment

Association of

to the clubs to make their

up

short-term, nevertheless
term

By GEORGE A. NICHOLSON, JR.*

Chairman, Advisory Board, National

inferior

low average

November 5, 1951..

'

■

•
.

.

,

•

r

*

12

(1752)

*

'

The Commercial and Financial Chronicle

.

The

Inadequate Rail Rates Endanger
Our Defense Program I

are

under

we

ica,

which

upon

reliance

chief

place

we

win

to

our
if

war

a

need be—or preferably, to secure
a

which

peace

>

may be main¬
tained by the

caution
fear

of

or

our

enemies
based

is

on

capacity

our

to

—

cents

war

door¬

the

to

of

steps

of

enemy
in
quantities un-

by

J. M.

Symes

how to
make atomic bombs, jet planes,
homing rockets and modern war¬
fare weapons of that sort.
But we
can
manufacture and transport
these weapons in unmatched vol¬
Other nations know

men.

unsolved

at

an

average

third
provided

keeping

ton.

cost to the

2V2C

passenger

bear

in

the slaveUpon this fact

ability

countries.

labor

of

place our hope for continued
in a world which has

we

interstate

fjrst

those

of

for

costs,

is

rates

railroad

Act

Commerce

was

existence

For

mile of travel.

per

in

services

1950,

..

it

was

has

has

or delayed inordipractically every request

the

railroads

the

last

20

The

lion.

in dollars

income

net

but when

large,

seems

sider the $25

you

con¬

during

made

have

for

years

billion net property

than

4%

a

investment.

return on

capital
expenditures
for
equipment last year
to $1,065 million dol¬

Their

give

couniv

our

Equipment

mobilization

defense

amounted

You

into

by

^terways, and c ss
y
ditch-diggers as 150,000 m s of
plpelites are burrowe
""der
gr°und. The railroads no lo ge
aeed regulation over rates m so

ceilings" are concerned.
Competition from outside the industry now takes care of that.,

far as

Higher Rates Helping Other
Forms of Transport?

Unfortunately, however, it is
Take
the
railroad
I
represent apparent, that regulatory authorialone (just one of the many rail-' dies. Pve mach weight;in,Jheir
roads)—the Interstate Commerce decisions as to whether increased

told

otemight,

retroactive

however, an immediate

danger confronting

segment

point tonight.

of

our

an

economy

and

discuss.

which

I

believe

you

will be

interested, it is necessary to cite
some figures, not too burdensome
ture of
means

this
i

you a

Class

I

railroads

ton-mile

as

of

real
of

efficiency of the rail
transportation is so

great that its competitive advan¬

tages

are

certain

America's standard

have

to

increase

as

of

our

rates have
told

over-

costs of materials

mtist

protection

"

clauses in

the

we

are

and that the manuhave
inflationary

gone up

facturer

make.

u g h
escalator
purchase contracts

t h r.o
But.

we

told^by

are

the Interstate Commerce Commis-

sion—many months after
have

gone

up—that

have what you are

you

costs

pricing—be-

as
,

won't authorize it:"
As
in

X? in.u
u11^ u"
tl0n fie*d, then there.-should be
new management: But we should
not now delegate that very lmporJard
Xu10!1^
management to
\: os,? n.0*
directly responsible
their actions. Don t misunderstand .me I am not advocating
that the railroads be released
from all regulation—I am suggest)Ye n?.w,,

that they he relieved from the
shackles of over-regulation, such

is now occurring by working
un(fer procedures of a Commerce
-^-t written more than 50 years
®*£o and, as stated, not adequately
amended since. , , ; . v .....

.'can't as

nearly as I can underthe reasoning, "we just

cause,

stand

our

seeking in the

increased

of

way

much fuel per

pay-load as railroads
—airplanes use 30 times as much.

up

as

in

the

;United States, of which there are
131 in number, employ a million

spondents, St. Louis, Mo., Nov. 6, 1951.




and

the

value

'

^Certainly, I would want regula-

.

tion to see that the industry
is fully protected with respect
following to area and other established dif-

example of what the lag
procedure
for
rate
relief
an

In

means:

World

the

War II

number
creased

of

years

there have

applications

a

ferentials—so essential to protect

in-

the free flow of commerce in our

been

for

partially offset country. I would want: regulation
inflationary costs, but from the for. abandonments of line, comtime the applications were filed solidations
of; properties, safety
rates

to

of

the nation's principal transpor¬

tation

Pennsylvania
Revenue

Railroad

alone.' tion to prevent any possibility of

sorely needed to imbeing handled—both prove, maintain and expand bur
plant to meet the challenge of the
freight and passenger—on a unit
agency.

traffic

or

Mr. Symes before the
Annual Conference of Bank Corre¬

♦An address by
Fifth

times

three

night that

We

a

pic-

great country of ours:

The

of

same

our wage

been increased.

to

even

government

living goes
such
relief
until
an hour's for
actually appliances, certain financial trans■work increases.
Contrary to the granted—averaging nearly a year actions, and things of that sort,
what the railroad industry belief of many, the railroads are —we
were
deprived of nearly designed to fully protect the pubto the overall economy of not
losing their "place in the sun" $400 million in revenue on the lie interest. I would want regula-

jjiope, that will give
.

trucks.
use

amount

same

distance in
On fuel efficiency, trucks
the

method

coming to those aspects

the

move

The

The U. S. Rail System

in

to

equipment, it takes 28 men

important freight

threatening the success of our de¬
fense program which I wish to

Before

road

agencies, that

or

by

date,

so

now

on a

more

If you count the

dollar basis, railroads did
1950 than they

business in

did in the boom year of 1929.

future.
It is

have

.

;•

-

cutthroat competition within the
industry ; itself that would, be
detrimental to all. So I repeat:,
:

J .advocate regulation of the in-

only natural, from what Industry - designed

said,

the

that you would raise

the public

to fully protect
interests under trans¬

lowest

jull

now

the

this

how

see

topic

of

fits

all

discussion
tonight—"Defense—and the Rail¬

checker-

Here is what we are up against:

are

shipper,. at

The

the

of

the

World

Are

can

costs, is the one that should move
the traffic.
\

during

the

A

that

agency

roads."

do-

demon¬

to

survive.

to

produce the demanded service of

road, and

individuals.
The owners nation's most important assets.
/
There is ample traffic available
of these enterprises
to move at rates which will allow
daily demonstrate a continually
improving efficiency, which comes the railroads to earn the income
when
thousands
of inventive they must have if they are to con¬
minds in a given field are spurred tinue to improve their efficiency
to extra effort by the rivalries of and service.
This efficiency has
competition and the incentive re¬ already been improved more than
wards
for
individual
success. is generally realized.
If we com¬
Others have warned of the dan¬ pare railroad efficiency with other
gers we face if the termites of forms of transportation we find
Socialism are allowed to eat away some very startling figures: To
the tent
poles that uphold our equal one railroad man working
industrial civilization, and I shall one day moving freight with rail¬
There is,

everyone

advantages

agency

ability

boar<^ecl W1th airports, dredged

and service
for by the men in charge

called
of

industrv in

the railroari

nlare

its

f^™a?s anf crisscrossed

general

a

utterly to meet the increased costs
which are absolutely necessary to

and managers

that

and

inherent

transportation

+

superhighway?

Their
operating adjustment of freight rates.
The
decision of the Commisexpenses were $7 billion. ^ They recent
paid out in taxes $1.2 billion. sion to cut the rate application of
They had net income of $784 mil¬ the railroads in half has failed

many

on

each

and

certain

transportation

increase^rate^ight improve,ne|
5p(mld> not

dwell

particu¬

question, all modern
agencies
have
a
field in the economy of our

strate

.

reduced,

nately,

nf Ltp!

^
^
^
administered, it no doubt served
needed purpose f t e
However, during the past 50 yea
be^e bas bae" a c.om.?
^ a^e
transportation in this c u^ry.

countries fall under lars—and this has been a continu¬
dictatorship, where the power of ing program every year since the
end of World War II—and should
war or peace has been placed in
the hands of a few men.
Power continue at an even larger rate. Commission has authorized freight ra*es m
concentrated in the hands of a The capital expenditures of the rate increases this year that will °ther competitive f°r?ns of t ansfew men is always threatening. railroads last year amounted to increase our gross revenue in the P°rt?Hpn
adversely affecting net
Power in the hands of the people 134%
of their gross net income calendar 'year
byl $27 million, income4p -a greater extent than
can be trusted in the long run to
without any provisions for divi¬ The increased cost of wages and
Of course, there was some materials during the same calen- income.
work for the good of the greatest dends.
I. say^that_
number.
-V S depreciation money available for dar year will amount to $85 mil- f°w be a consideration of reguThis industrial might of which
This mean s / we are $58 latojy
improvements, but entirely in¬ lion.
authoritiesIf the railwe
are
justly proud is like a adequate when you consider that million short in this one year roads require additional net inprotective tent over our civiliza¬ the price of replacements is more alone from obtaining relief on'fome-and the records
clearly
costs, indicate that they do
not even
tion, supported in America by the than double—and in many in¬ rates to offset increased
staunch
tent
poles
of
private stances more than triple — the Extending this situation to a full disputed by regulatory authorities
enterprise.
Privately owned and original cost of the facilities being year — increased rates would
y? d ke permitted to
managed farms, mines, factories, replaced.
I am sure you will amount to $59 million, and in- bring it about ui;a businesslike
power plants and
transportation agree that the figures cited are creased wages and materials-;'1 to wayH management does ^not
agencies, each represent the accu¬ somewhat staggering and indicate $96 million-still $37 million short kn°w how to price their product
mulated and treasured savings of that the railroads are one of our in
offsetting increased costs.
We ln a competitive market, such as

not

transportation,

country,

good

a

f?

.

j

billion.

$9V2

many

seen

of

proper

law
our country, that then, except
steei raiis> was ankle deep in
wrjtten,

ft?n ™ tb®. Sn

,

Commission

Commerce

Interstate

and we can
the

failure

increased

with

bring them to investment of these carriers, they sitlon to
concentrations that far actually
earned last year less improved

ume,

exceed

the

is

difficult to understand."

they re¬
ceived—in round figures—a total
revenue
from ' all operations
of

Other nations have more

nation.

freight

per

these

other

any

original intent.
The next biggest problem fac¬

miles

397,000

and

average

an

an

matched

to
meet
present'-day
conditions, which after all was its

Sixty-four years ago when the transportation

railroad industry during
several years and still

the

past

administration

through

Without

Th<L biggest Pr°klem confront-

They
Freight rates: .represent a far
passengers
with
the
nation's? lower proportion of the cost of
safest, most comfortable and de¬ commodities today than they did
pendable type of transportation at 20 years ago.
Despite this, the

instruments of
modern

regulating

miles

225,000

operate

miles-of

terrible

the

women.

cost to shippers of one and a

deliver

pretation

designed

of regulating the pricing of the in- for
over
the other.
However, these
of dustry, to recognize that when mud
At that time the railroads inherent
advantages should not
track; enough to circle the globe inflation moves in on the costs of were more or less of a monopoly be pushed aside by subsidy, and
1*3
times.
They operate 40,500 conducting
business,
as
it has
the transportation field. Today when such subsidy enables one
locomotives,
about
2
million since World War II, it must also
agency
to
take
they compete for every ton of transportation
freight cars and 37,000 passenger move in on the pricing of the
freight and every passenger they traffic from another that is not
cars.
This equipment, standing product sold.
We sell but one carry
but
they
areregulated subsidized, you have the fore¬
end to end, would extend across
product-transportation-moving under a statute that has not been runner of destruction of a healthy
the continent and two-thirds of people and goods to where they
system.
All
we
adequately amended to meet mod- transportation
the way back again.
Last year, want to go.
ask
is
Why we are denied ern conditions
equality
of treatment,
railroads handled 589 billion ton- the right to increase charges, in
raiiroads reauired recula- and from there on it is up to each
They

railroad

produce

and

and

1 snould like to not require too mucn change—
that the nation's maybe it only needs proper inter¬

forms

•

now

own ?c;°rc\ Congress should
amend the Interstate Commerce larly the highways and airways.

Problem

ing
men

,

Insufficient Rates-Biggest

and expansion of

quarter

a

-

they

as

be that the Inter¬
state Commerce Act actually does
may

ing trie industry is that of subsidy.
and The inherent economic advantage
fares.- . If the Commission does of rail transportation is being
not change such practices of its submerged by the subsidy of other
in

the government

by

through taxation; 7

It

exist.

lowed of "too little and too late"

all cherish so much, or

operated

are

the

industrial might of Amer¬

done about it?
declare tonight

enterprise system

free

the

which

railroad facilities.
The

they

.

portation conditions

defense effort and the economic
soundness of all types of business
of our great country.
Tnese facts will be endangered unless the
will remain
true whether rail- Interstate Commerce Commission
roads
are
allowed
to
continue changes the practice is has fol-

nation's defense effort and general economic
strength is endangered unless the Interstate Commerce Commission grants adequate rates to railroads, Pennsylvania Rail¬
road executive contends rail rate increases have been insuffi¬
cient to meet rising operating costs.
Denies increased rates
will drive rail traffic to competing transport, and contends

and

try being shackled in the manner
I have described, and what can be

omy in time of peace and essential
to the defense or war protection

Asserting

inadequate earnings prevent improvement

indicating

healthy railroads
important to our overall econwhy

do—and

Vice-President, Pennsylvania Railroad Company

'

have .two questions—why is the indus-

used

have

I

what the railroads are—what

X'V/

By J. M. SYMES*

figures

been for the purpose of

Thursday, November 8, 1951

...

my

railroads

proved

that

II

War

?

they

the

only
transportation
agency
equipped to handle the
war traffic.
They are just as es¬
were

sential

defense

the

to

will

there

be

be

railroad

adequate

transportation

not

adequate de¬

there

could

fense

or

be

production in this
That is a fact not dis¬

war

country.

puted by anyone.

prevented

are

program.

more essential if
another war.
Without

They

If the railroads
from
procuring

earnings,

adequate

improve

to

expand their facilities, and
outside capital is not obtainable,
which
it certainly will not be
and

without proper

earnings, where is

coming from to do the
things 1 that: need
to ,, be done?
Without a continuous rail flow of
the money

.

materials

raw

to

industrial

our

assembly lines, and adequate rail
transportation from one plant to
the
next,- millions
of workers
would soon be idle and America's
mobilization

entire

program

would be snarled in hopeless con¬
the

If

allowed

to

is

sufficient

not

deteriorate, and there

would be the

thing I could think of
or in our de¬

most serious
in

our

to

equipment

the traffic, it

move

is

plant

railroad

fusion.

economy

f

fense.

the

Rails and

In

Defense Program t-

passed

Congress

1950,

and

Act

the
Act
Production
of 1950."
The purpose of this
was to strengthen this coun¬

try

militarily

President

the

signed

known as the "Defense
Act

policy,

as

stated in the Act, "to

acts of

oppose

economically,

and

enable it to carry out

in order to
its

aggression and to

promote peace," and, for this pur¬

"to

develop

and

whatever

military

and

pose,

maintain
economic

strength is found to be necessary
to carry

To

Act

out this purpose."
this objective,

achieve

the

that there
must be "expansion of productive
facilities beyond the levels needed
expressly

to/. meet

the

states

civilian

demand."

Expansion of productive facilities,
in a free enterprise economy like
ours,

necessarily means increased
by private capital in

investment
the

creation

ductive
means

of

additional

facilities.
that

This

pro¬

turn

private

be allowed to earn

vide

in

additional

capital must
enough to pro¬

funds

for

such

increased investments
With, this policy of encouraging
expansion of productive facilities

Continued

on

page

27

Volume 174

Number 5062

.

.

,

The Commercial and Financial Chronicle

(1753)

Healthy

Foreign Trade and Point IV
Program Passports to Progress

Foreign

Needed

Trade

We industrialists have made

our

estimates, called in the architects
and

engineers,

we

Since the end of the last

sent

our

eign aid.

President, United

States

Steel

Corporation

Leading industrialist, stressing need of healthy foreign trade,
upholds program of foreign aid if aim is to help free nations
help themselves. Urges government, in carrying out Point IV
Program, to help create favorable economic climate for Ameri-

'

A

certain

predecessor

President of U.
of

man
ers.

S.

of

Steel

mine
was

unusually persuasive

His

name was

a

pow¬

Charlie Schwab.
One incident
i

Schwab's

n

life

perhaps

a

sentimental

tions

Then

the .farmer

down

arm

plans had been
-

drawn
a

had

com-

collected

liSpR
^ut
jparcel

-

WB

steel

officials

pany

MMfe /-Mm/,

ik

large

'm

Wrrn-%

for

up

new

mill, and

■b

°n e

of a
of

tract

land they

xjmujM

needed.

they

Benjamin F. Fairless

Here

struck a
The

snag.

farmer who owned the land stead¬

ily and stubbornly refused to sell.
Vice

-

presidents,

local

mayor,

crack

at

They
some

lawyers,

everybody

offered

him

more

stock,

the

took

trying to win him

company

a

over.

the

Trade

eign

address
Dinner

by Mr. Fairless at World
of

the

38*11

Trade Convention,
1951.

Oct. 31,




Na»ion-»l

New

York

for¬

City,

his

his

put

heard

They sat

big,

Turning

genial

the full voltage of his
electric personality, he started to
on

with

reason

talked

only

him.

Schwab

short

a

time

had

when

suddenly the farmer jumped up!
"Mr. Schwab," he said, "I'll sell
you the property, but thank God
I'm not

a

woman!".

Schwab

faced

which Charlie

one

when

he

sat

down

with the farmer.

industry, with only
of the earth's population and

7% of its area, produces
half

goods.
since

of

the

In
the

world's

fact,
birth

in
of

the
our

—the
more

United

against all

crease

of

How

interests with

of the goods we make to

more

the people of this Nation—and

the

people of the world

to

have

—

ciple.

responsible for our amazing
growth as a Nation and as a

world power...
The economic

"

of

power

the

knowledge

United States has twice saved in¬

nations.

dividual

ter

liberty for the
Now, for the third time,

world.
we

are

to

less

As

in

same

time

sense, just
Government's Point IV

we are

encouraging and giving aid

the

other

gram

world

build

may

nations

of

the

that

so

their

up

non-

they
strength

against the threat of yet another
war;

li;'r

Two

wars

other

in less

historic

than 40 years

developments

now

Nation—
we

States has produced

things than all the

rest of the world has produced

all the ages of man combined.

in

*v. -1

as

an

arbiter of world

Nature abhors

fore, either
sia

will

created
power.
are

we

a

vacuum.

must

move

into

peace.

There¬

move or

the

Rus¬

vacuum

by the decline of British
I know that all of us here

deeply

aware

of this sobering

Some call it the free

call

it, this American

Unfortunately

which

what

few

en¬

way

way of
of doing

this is a point
in foreign na¬

people

tions

understand.

never

has been

pro¬

sets out to accomplish.

a

While

there

system which of¬

fered so many advantages to all
more, American
industry
ready to step up its time- classes of people,-the world at
honored role in foreign trade— large, generally speaking, still
fails to understand its basic values.
provided, of course, that our gov¬
ernment supports American busi¬ I've heard many definitions of our
ness
in its desire for increased system, but it can perhaps best
a

trade

favorable

Amercian

be described in words which
many

by helping to create
economic

investments

climate
in

of you who attended the

for

ference will remember.

foreign

This

can

it is the

be

to set up

to

agreements with all countries of
the non-Communist world.
Such
measures
ness

faith

Rye Con¬
I quote:

"Basically and fundamentally,
right of the citizen, as an
individual, or jointly with others,

.<

brought about best
by negotiating treaties of friend¬
Empire has been seriously modi¬ ship and commerce and similar

fied

moment

a

stands

Soviet Russia, and second, the fact
that the strength of the British

first, the rise of

ior

What's

175

are

consider

they,

efforts.

our

things—is unique in the economic
history of the world.

American

industrial

an

to

the

fact

lands.

years

we

business for years has been doing,

At the

of

For

we

life—this American

...

matter

against Communism
equipped to
defend

terprise system, others the capital¬
istic system. But no matter what

industrialized

the free world.

a

to

side in

our

we
mean
by the American
of life which we are trying to

defend.

The second aims to "fos¬

countries.

world affairs

than

Let's

way

capital development" in those

rapidly increasing our productive
might to defend our Nation and

be

see

by so strength¬
will be defending
heritage and our way of life

what

industrial

and

But

should

is to

on

too, will benefit from

highly in favor of

scientific

It

purpose

nations

her

world.

for generations to come—and

Point IV actually has two main
The first offers our ad¬

.

better

our

features.
vanced

our

ening them

full support of Point IV.

been

a

for giving this
to the people

countries?

themselves.

To the extent that this view

is correct, I am

reason

struggle

are

the

assistance

share

to

eager

with

our

other

the

by

us

is

it that the

surest path is to in¬
aid to the nations who

common

industrial

more

what is

technical
clear that

question:

such

Share Our Know-How

know-how

way.

forward? In my

move

Will

America

the

our

world

during the last 50 years

material

be best

can

have basically changed the world
balance of power.
The two main
strands
in' the
new
pattern of

thanks especially to the strides
have made

bulwark

We

go

will go on,

we

effective

the

comes

have

a

sure

every

must

Our helping them to help themselves.
This, I understand, is the aim
capacity to produce and our desire
of the Point IV
and determination to give
program, in prin¬
more

and

American

6%

Now

cour¬

opinion

Communist

Now, the problems of American
industry today are pretty much
like the smaller

the

am

We

speed

for¬

of

Help Free Nations to Help
Themselves

adventure

all

patience, humility—and, yes,

age,

and

the parlor sofa

on

bold

require

I

sight.

to

government

program.

whose aim it is to destroy us.

around the farmer's shoulder.

money,

double

acreage
somewhere
else.
The
farmer would not budge. He had
""An

Charlie

and

that

his home.

at

together

of

role

will

us to play a
community of na¬

capacity is

to

Schwab

for¬

in

in

yet

persuasiveness at our command.
Now
our
huge manufacturing

about the problem and decided to
try his hand. He went to call on

this gift of his.
seems

Charlie

interest

not

requires

a

—

which
.

vital

role in the

new

land.

best illustrates

It

attachment

helping in

eign trade

can investment
abroad, and says America is eager to share its
know-how with free world. Stresses value of foreign trade and
Point IV program in giving U. S. access to needed raw materials.

as

one, and

Our

is

our

an¬

or

And the end apparently

last acquired the property we need
—all but one piece. And that piece
I've
labeled
a
"healthy foreign

trade."

By BENJAMIN F. FAIRLESS*

fair return in good American
dollars. I recommend that we
urge
a

have attempted to fill this
For tms purpose
we„nave

overseas, in one form
the approval
plans, and at other, $100 billion worth

got

of the board for

thought.
war

vacuum.

11

in business for himself—

venture

his

and

the

will give American busi¬
in the safety of its in¬

capital; to
mechanical

tion.

The

personal

own, use,

of

means

reward

of

efforts

and risk

produc¬
is

success

vestments,

profit, and the penalty of failure

them

is the loss of what

freedom
to
manage
in cooperation with nation¬

...d&ze
I.

has been

Continued

als of the countries concerned, and

on

ven-

page

19

are

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

delay
to

t.

Large, efficient piers. There

are

four covered merchandise

piers; two

open piers, one equipped with gantry cranes and the
handling oil; and two coal piers having a combined
capability of dumping 12,000 tons of coal per hour.

other

for

O* Railroad facilities for 10,300
tion

where congestion might
bring disaster to shippers.

cars.

paralyze

These prevent conges¬

freight

movement

and

,

4.

Strategic location. Through this port shipments flow by the
shortest route between Europe and many
large American produc¬
tion and distribution centers. By
shipping via
Newport News

save

5.

money on

freight rates from midwest

you

and south.

34 million cubic ft. of warehousing. 113 warehouse units

.

•

v *

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

.

*
.

6.

Efficient handling equipment. Hundreds

of skilled and
willing employees work at the C&O piers with a full complement
hoists, conveyors, pipe lines, trucks, tractors, trailers
and other equipment to aid rapid, safe handling of every
type of
freight.
■
\
;
-

of cranes,

.

7.

Roil connections.

and Chesapeake &

A web of rails connects piers, warehouses

Ohio lines. More than 6,000 miles of C&O track

tie up with other lines to reach every corner of the continent.

8«

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

The World Commerce
tors

en

ell

Deportment of the Chesapeake 1 Ohio system is fully equipped to help exporters, importers, forwarders and
ship spore*
to rail and ocean shippinf of foreign and interceostal freight. If you have a problem, contact G. C.
Morquardt,

problems related

General Manager, World Commerce Department, Chesapeake t Ohio

THE

CHESAPEAKE

Railway, 233 Broadway, New York 1, N. Y./e*

and

OHIO

any

C&O representative.

RAILWAY

14

The Commercial and Financial Chronicle

(1754)

squeak

Is Stalin Right About the
Free Enterprise System?
Former Federal economic adviser,

stand

all

Economic Advisers

story

is

told

What
about

does

nearly
and

billion

$20

nearly

year.

prospect

Stalin

old

Simply this: "It won't work."

1950

As

the

leading spokesman of authoritarianism, or

and

autarchy,

or
totalitarian¬

placency.

ism,

■

and

give

confidence

for

cause

or

certainly

com-

'.K/?.-

whole

a

for com¬

excuse

no

In the 30's, we

tried devaluation
of

flock

Deal

New

the

and

the thresh¬

on

sense,

which

in

the

or

at

or

military

Bank

es¬

intention to talk

about

Export-Import
Washington. Especially I

of

should like to give you some idea

the

pressing
practical busi¬

of what

in any
of postponing projects

peacetime,

but

think

and

whatever

alphabetical

or

you

be

.

from

just

—

what

people, not

down

party

-

undermine the dollar under pres¬
semi-war conditions.
'
•
«

mem-

or,

more

be

to

be

settling

period of

a

It

chronic

to

shock

the

was

,not the brilliance of

war,

particularly,
t h

out. The

Politburo

e

of

know

how to handle

their
*

As

you

and

the

other

and
Edwin G. Nourse

to

d

a n

me

of

rest

the

Americans, he

know

how

154

million

says we

make

to

choices, to enact

don't

our

own

laws, and

our own

then comply with those laws well

enough

that

so

we

keep

can

our

economy running, keep
and productive. All the

it strong
Kremlin
wait for our fragile

'has to do is to
'

war

technology,

scheme of freedom to break down

and fall of its
am

not

am

not

going 'to, go

going\to talk back. I
into the de¬

Communist

theory

or

make any comments on the break¬

of the communal farms,

down

or

the slaughter of the Kulaks, or the
volcano
of
revolt
that
already

rumbles behind the
that

'and

to

on

fifth

a

round

and

creases,

in.

the

not

of inflation.
down

future.

There

our

fortitude

turning

our

whether

eyes

all

cherished

gained by
inward to ask

is

well

with

our

to

Since

economic

show¬

a

and

sense

postponed.

Korea

of

this

competent
of

source

to

control

inflationary danger.

should get

been
nomic

mixture

and

sense

and

scared. With

eco¬

of

was

country

was

rearmament burden

a

thrust upon us, taxes were upped

little

a

than

more

ev¬

The Office of Price Stabilization

became

tion,

and

Board

office of price stimula¬

an

the

became

a

Stabilization

stimulation
"freeze" in

wage

board.

They imposed a
January, and on Feb. 1 they
to

thaw

it

here

out

and

there end everywhere. The "con¬
trol" program has become a

costly

and

burdensome hoax.

them

to

but

also

that

system of freedom and

build

up

defense

Soviet

that,
job

parts

that

so

within
we

well

sure

to

impregnable wall of
against the dangers of
an

aggression?
we doing
running a

are

of

it

are

Not

merely

good enough

a

free

economy

that

we
will be safe against
danger of a depressionary
collapse, once the stimulus of re¬

so

the

armament

yond

is

that,

removed?

are

enough job

doing

we

that

so

Still
a

be¬

good

will satisfy

we

the needs and expectations of

people in peacetime

they

will

against

change—in

our

duced

people

by the

Socialists,
within
ment

free

proposal

any

tionary
that

defend

rosy

or

for the

answer.

do

think

not

have

that

govern¬

they

its

are

actual

*An
fore

living under

since

address

the

handle

their

economic

affairs

ably? Far from it. From that high
point of resolve or of terror, we
began
strain.
the

to
A

lines

crumble
of

under

the

later, all three of

year

defense

against

eco¬

October,

the

of




.

red

and

leave

it

with

moderate surplus on June 30

a

last.

The third tax

bill, just completed,
brings the tax load, as a practical
matter up to

country

about the maximum
can

or

will stand.

1929

deficit

a

next

June

and

another push of the dollar below
its present 53-cent level or else

we

by Edwin G. Nourse be¬
Coffee Association.. San
1951.

appreci¬

Congress last fall were
sufficient to pull the country out

a

record

been

the

native of

frankness, I

National

Calif., Oct. 24,

en¬

terprise and free government will

to

written

system of free

This presents us with the alter¬

Doing?

the

a

to

assure

presided
that

Stalin is wrong and that a people

the

(the crash), since December, 1940

D^go,

agency was set up. '
Does all this demonstrate

bor

tion

the

over

and

If

...

stabiliza¬

wage

from

program

ginning.

production—have
the

have

we

unsatisfactory

be¬

very

unfair

an

stabili¬

wage

zation program, then it means that
our

workers

will

naturally

Herbert E.

you
an

First, let

Gaston

give

-

the

me

you

a

of the facts about what

summary

Bank

Export-Import

what

and

do

to

was

is

it

ac¬

trimming of appropriation bills
a

point where expenditures will

not

exceed

revenues.

gress has not done

in this direction

ing.
tions

Even
we

on

could

as

Con¬

as

well

it has in

tax¬

present
do

Our

nearly

no

authoriza¬
more

than

the words of the President recom¬

resentful, will feel that they have
been

asked

to

work

under

rules

that have been rigged against them
and that rob them of the

buying

cannot

be

the

counted

upon

that

program

was

Johnston went

have

special
—in

Our

that the

on

on

single

principle,
to

say

out

treatment—for

.the

wage

acceptance

policy "does not,

said,

that

call

Also

dollars.

billion

in

the

of

finally in the approval of it
Houses
by votes from

both

sides of the aisle with prac¬

both

tically

dissent.

no

Foreign Trade
What

are

Mr.

give

of

program.

fair

and

equi¬

table treatment to all the
produc¬

ing

groups. The farmer by law i?
given the protection of the parity
formula.
Similarly, the manu¬

our
we

'/">■!

-

,

Export-Import Bank has
made and is making loans in many
countries.

We

have $3

commitments
loans

We

making them defi¬
the purpose also of

are

nitely! with
creating

greater

world.

But

we

stability
I

trying

to

banking

in

not

are

loans.

any
not

Our

made to promote foreign

are

trade.

billion in

outstanding.

take

you

we

the

over

the

and

the

making

assure

foreign

investment business of the United
States.

We are trying to restore
trade, normal lending and

better

economic

around.

That
and

it

we

that

enter

not

order,
am¬

so

might sound.
and

funds

of

big

a

are

franchise

no

to

like

But

as

all

■!'v"^ ;

-v

sounds

is.

bitious

us

climate

"

upon

We
such

no

enable

to

as

to re¬

programs

(the

tries.

V-v

.

What

we

'

.

hope to do in all

\ 1

cases

is to make possible the accom¬
generally for specific pur¬ plishment of key improvements,
poses to facilitate and aid in fi-,. to establish key industries or to
nancing the export and import aid in financing necessary and

loans

able

assurance

don't

of

definitely

of

be

"reason¬

repayment." We

loans

make

tation

shall

there

purpose,

without

We

repayment.

not

the

in

expec¬

highly

We

are

duty is to

our

the

of

They

sense.

terest

of

are

This

bottleneck

might
basis

the

to

be

of

econ¬

where

we

the

called

working to¬
have be¬

the objectives we

ward

fore

aids

countries

j

us.

are

the interests

States.

in

the

Philippines and Indonesia

The

A delegation from the Bank re¬

serve

United

political

are

of

work.

give-away

public institution and

a

critical

omies

grant business.

or

very

made

American

loans

eral

help

the

in

returned from the Philip¬
pines, where they examined sev¬

broad

Our

that

cently

trade

in¬
and

loan

new

projects which may
new
life into an

inject

to

which

economy

investments

needs

and

specific

needs

the

also

often—they are example of improvement efficient¬
ly accomplished.
a more vitally important
The Filipinos
That purpose is to make are doing their part faithfully in

sometimes—very
made for
purpose.

trying to bring about the reforms
little beyond that, to advocated by the Bell mission and
incorporated in the Foster-Quirino
serve the cause of peace and free¬
dom in the world. The freedom agreement. We are working in the/
of which I speak means freedom Philippines in the closest harmony
friends for the United States and,

to

for

all
what

amended) says we are to make

as

the

labor

analysis,

reason to meet

The

Export-Import Bank Act of 1945,

as

some

times

patience and

make the economies of any coun¬

•

The Act

for?

we

"

hasty

are

they

the

have to meet.

have

Banks Loans to Facilitate

all

scientific

powers

a

and

for

are

we

for

.too, than the mere teaching of ex¬
perience. We need all our powers

and

in

times

no

it

the
wisdom
the
ages
have
taught us—if they have taught us
anything. We need a little more,

normal

Currency Committees of the
Houses favoring this action,

are

that;

all

unanimous reports of the Banking
two

of

converse

and excited action;

by or borrowed from the United
States Treasury, be increased by

trade,

a

to

be

progressive

accomplished
removal

by

of

re¬

with
and

the
in

EC A,

all

other kinds of

we

find menacing.

and

to

do

to

need

we

understand

critical

times

to

times in

gree,

and

to

that

recognize
these

unusual

an

which

we

we

run

but

think

I

oppression that

are

the

two

meshed
It

de¬

to

positive things in the national

the

in

They

field'

are

not'

what loans to make

us

not

their

telling therri how
aid

grant

programs

program;
are

being

together.

are

need

both

Washington.

strictions, and freedom also from directing

stabilization-program has been
to

These

are

that the

favoritism

stabilization

designed

in.

foreign

going just

based

escalator

Board's

pro¬

we* need."

After' explaining
of" the

to

goods in the speed and

utterance

gave

the

but

mending that the Bank's revolving just

feel

volume

Communists

In all

direct defense control

a

by

se¬

think

objectives—to pre¬ trade of the United States. It also
inflation and at the same
stipulates that, so far as is con¬
time to maintain fair
play for la-* sistent with achieving our main

be

not

I

vent

duce

So much for the
question. Now

•

war

First, let us look at taxing and
spending. The two tax bills passed

revolu¬

gives them the opportunity

Are We

ma¬

,

to

words,

to upset free enterprise if

How

and

men

shifted

ably, if not dangerously, weakened.

for

by

work. And

be

power of their wages. Such work¬
ers—dissatisfied workers, workers
who
feel
themselves
cheated —

Free

deeply dissatisfied
performance.

that

so

would

nomic threats, have

Planners, the

the

midst.

our

credit

terials

fully that

other

will

our

on

enterprise

so

is

in

have

only a couple of weeks ago,
frankly admitted not only that
price and wage controls have lots

,

whom
to the

man

softly in these times that

That

subject

interest.

radio broad¬

a

great

very

admired

abundance

Eric Johnston, in

"give"

I

tion

which

cast

of

a

is wise for those who carry a big
stick to speak softly and to read

all .of

a

Wage

—by two laws, that totalled about this reflects the policy of ESA—
/y,'. $10 billion—but not near as much don't do anything that would make
Is free enterprise
The
Federal
Reserve anybody unhappy. He said: •
in America spending.
working so well, are we doing our was authorized to put the brakes
"The
twin

enough

the

authority to lend funds, subscribed

erybody else.

vigor

Congress

the

v

of

folly,

vacillation.

has

record

? our

strange

a

:

that everybody

mean

self-direction.

respective

the

a

created

preted it to

better de¬

some

living and of freedom.

Once

field.

was brought on the
Congress, and
they tied the hands of the persons

technically

that

investment

shoe string Or

a:

by aspirations for
gree of

others

are

momentarily dan¬
are
actuated only

foreign

ability to maintain sales
by easy credit, pressure

volume

late

Military Stimuli

K-Day

scared,

be.

dealers'

on

which

are

movements

States and the

through credit expansion. But as
as Regulations W and % in¬
terfered with some comsumers'

ability to buy

there

may seem to us

gerous

step. There

our

menacing

and

the thought that it was wise to
speak
trade: softly and carry a big stick. I am
United going to suggest not a contradic¬

.

fall

soon

began

there

to

to

latest reprieve.

Back

and

much

last

extremely
afoot

and

foreign

did something significant to cheek
the flow -- of inflationary dollars

fair guess that

a

come

was

is nothing to be gained by
screaming, "You're another!" But
is

little

a

time in 1950. But again

some

the

passed

cqmforable spiral

It is

the test of

was

in¬

wage

public—with

might have

we

blow the

distant

very

to the

on

of

management

addition—in the

unpredictable day

some

Congress

need to watch

e

Third, instead of the effective
After V-J Day, we went in for
and equitable safeguards through tually doing. If you find a dis¬
a mental vacation
of inflationary
crepancy you can note it down.
overall fiscal and
monetary meas¬
prosperity.
We
simply
ducked
But we think that what we are
ures, we sought the easy way of/
consideration of the responsibili¬
so-called price and wage controls.* doing is the logical and sound
ties of a $260 billion national debt
That looked like a good way to evolution, in tune with the needs
or
the adjustments necessary
to
of the day,
of what we were
make the other fellow bear "the
put our peacetime economy on a
burden of war shortages. The in¬ specifically created to do.
stable foundation. Labor used its
The President and the Congress
terested parties p r a ted about
power to get a first, a second, and
"equality of sacrifice" but inter¬ seem to agree. We read that into

Iron Curtain

probably will

top off in

it

the stage for the postwar
1
-v
■'

set

them

weight.

own

I

of

but

the

inflation.

'

tails

us

great triumph

a

was

industrial

bailed

begged all the economic questions

own

affairs.

.

our eco¬

nomic management, that

—don't

of

Second,

of

Bank

market,/and

ent

we

problem of get¬

seemed

stagnation.

bers

.

the

But

ting our economic machine going
again and rescuing the country

that

says

people

i

solved

never

want to call it.

;

agencies.

t h

loans

•

munism,

is the

between

which

materials

we

relation

impair
effort, disturb the

the rearmament

little

a

the

in> themselves desirable

are

labor

It is my

while

extravagance in either

necessity,
ness

*

a

civilian

the

(the Korean outbreak)
much

us

is

year,

for

With this alarming
them, the Con¬

refused—even

of

waste

1945

ExportImport Bank. Stresses relation between loans of the Bank and
foreign trade and foreign investment of U. S. Explains why
Bank makes loans for key improvements, to establish key industries and to aid in financing the national economy of coun¬
tries in which U, S. has interests.
Says, there are, here and
there, obstacles to foreign private investment due to exclusive
and discriminating laws, but sees
atmosphere improved.

ran

year,

campaign year—to take
serious look at the problem of

a

(Pearl
Harbor.),
since
August,
(V-J Day) and since June,

say

idea of freedom?

our

Mr. Gaston describes purposes and operations of the

before

gress

as much as economy
Stabilization has become "an

are

alone

last

billion

$60

following

stimulation." Urges public be aroused in defense
dollar, and criticizes Congress' complacency.

Marshal

and

us

By HERBERT E. GASTON*

present

projected at $40 billion this

tablishment

,

the

in

Thursday, November 8, 1951

.

Chairman, Export-Import Bank of Washington

that only part of

us

spending bills.
Military
spending

referring to adverse effects

office of price
of the

assuring

the

Says tax load is

Office of Price

and

at at
Presi¬

the

And

Congressional committees

ous

inflation, says Stalin is shrewd enough to know that whole
system of free enterprise is submarined when monetary unit
is corrupted. Questions whether we are doing a good job in
running a free economy, and warns we now have an "infla¬
tionary prosperity."

estimate

now

billion.

.

Loans to Build Sounder Trade

deficit

a

dent, the Pentagon, and the vari¬

of

can

people
six

June and
which

next

have

even

some

least

By EDWIN G. NOURSE*
Former Chairman, Council of

through

might

.

may

or

it

may

not

surprise

you

to know that two agencies of

the

United

States

can

work

to¬

.

facturer

and

the

merchant

given the protection of generally
and equitable price ceilings.

fair

-Continued

interest
*An

page

25

address

International
National

on

and

times

in

which

we

are

York

by

Finance

Mr.

Gaston

Session

of

gether
of

at
the

the
38th

what

program.

is

on

two

inherently

But

it

aspects

the

is done;

same

and

it

Foreign

City,

Trade Convention, New
Oct. 29, 1951.

amicably

is

being done in the Philippines.

Volume 174

Number 5062

*

*

The Commercial and Financial Chronicle

.

(1755)
The economic
problem

islands,

like

the

of those

political

lem, has significance for
of

some

us

There is
is also
be

a

as

our

to

repu¬

nation that

a

well and is able and

means

willing
unwilling to finish

unable and

what
as

importance

question of

tation in all Asia

or

underestimate.

may

tremendous

It is

that

us

trade angle, but there
angle of face that may

a

an

of

us.

prob-s

it

starts—in

peace

well

as

war.

involved

people

in

of

same

question is

Indonesia,

ancient

where

culture

a

aries. We
we
a

of

is

job that

a

to

who

live

volves

ahead

get
in

free

the

be

It also

private

enterprise
private investment.
There

cal

shape

politi¬
and

are

in

of

here

the

in¬

it

in¬

fair

so

gain from

may

and

American

American

They and the

foreign

contractors

ob¬

best

the

discrimi¬

of

on

indi¬

corpora¬

men

we

may

supervisors

as

foreign

jobs

or

be

our

If there

something
made

think the United States
to

about

Two With A. M. Kidder
(Special to The Financial Chronicle)

FT.

private
which

chance,

I

say,

boils

if

down

I

to

had
this:

With Kidder in Miami
(Special

long

so

O'Brien

us.

We also need

with

investment

and

make friends for

to The Financial

MIAMI,
A.

has
M.

Southeast

us.

With Lamson Bros.
(Special

to The Financial

become

Kidder

First

formerly

with

has

With

Cohu

too impatient

•

Gordon

—

yet

much

fully

on

become affiliated

DENVER,

with

ler

Lamson Bros. & Co., Stuart Bldg.

is

Co.,

now

Inc.,

Colo.—Robert Koehwith

22'9

Renyx, Field

East

million,

allocated,

is

mind because

my

very

Ex¬

an

port-Import Bank team headed by
Mr. Lynn
Stambaugh, one of our

directors, has just returned from
there,

but

leaving for

economist

and

time

a

an

engineer

an

for

further studies.
•

I

might mention in passing that
Vice-Chairman, Mr. Arey, is
now
returning from Europe alter
our

visits to
Holland, West Germany,
France, Italy and Yugoslavia. We

have been working in Tito's

coun¬

try

when

since

September

1949.

made the first of three credits

we

totaling $55 million

to help
in the reorientation of their

them
econ¬

toward the West.

omy

Mexico
Let
I

those

intend

credits

who

to

in

are

view

around

all

the

fear

the

lest

Bank's

world

be

re¬

assured.

I'm not going to do that.
But I do want to mention another
that
has
some
special
features.

Mexico is an

old

tomer of

and

ours

and

sound

have

we

cus¬

a

great

variety of credits there, from steel
to

synthetic fertilizer.
for

row

Financiera,
lending

their
and

Recently through Financiera,

shape.

them.'!

I

choose
when

care

men

say

some

ex¬

and

our

own

Behind this

some

staff,

on

to make

us

have

that

the

voluntarily

sistance

Mexican

Nacional

and

of

the

of

selecting

technical

will

The

this

is

adviser

and

In

City is at work developing world trade

over

National

facilitating American business abroad.

who

American

a

stant

50 years

constant

as

reports

those changes

of chang¬
occur.

of Foreign Banking Service,

City has accumulated credit information

use

importers and exporters make

of National

on

con¬

140,000 foreign firms. You can profit from

this wealth of information and service

City's ability to get the

by calling

to

go

right information

to

help with the big job.
Export-Import Bank—and
the

come

ing world conditions

as¬

Association

American Railroads in
Mexico

National

Gov¬

Financiera

sought

the

located branches

Rio de Janeiro, Hong

Kong and 50 other important trading centers,

suggestions, but it is with a
great deal of pleasure that I make
known

accurately, completely and fast. From strategically

plaque, which is equally familiar to

the citizens of Paris, London,

some

ernment

J

"••W'V

"help

men

it has been possible for

it

♦

Experience in Foreign Trade

words

my

I

With the aid of

perienced railroad
pretty able

'

A 1 Ts*"V

Reflecting National City's Wide

we

agreed to lend $51 million to help
them to put their railroads in firstsome

*

insti¬

•

class

i

v

-

I-

and
thoroughly

a

well-run

tution.

with

xo.

;f-

Nacional

borrowing
is

agency,

business-like

•?

>

They bor¬

production and

on

foreign trade and get it

our

Head Office

or

any

branch

or

correspondent.

point I want to make

—is not

going to rebuild the phys¬
ical system and renovate the man¬

THE

agement of the Mexican railways.
No, it is going to be done by the
Mexicans for the Mexican
people.
The
Mexican
railways are not
lacking in mechanical, operating
and

managerial talent.

help

them

now

and

suggestion

that

may

prove

good,

know

by

we'll

If

we

then
or

do

and

it

67 Branches

OF

NEW YORK

New York 15, N. Y.

throughout Greater New York

Member Federal Deposit Insuronce Corporation

T

•

a

not

may

it

CITY BANK

Head Office: 55 Wall Street,

can

with

that

experience

NATIONAL

we

ffla/iAin/j

fit

will

enter atlentive ears.

54

;
The United States has a definite
interest in better railroad service

to take

care

of the

in

Mexico; but
deep interest in

growing traffic
also

we

have

a

the welfare of
the nation to the south of us that
is

by

cratic

a

choice

a

free

and

it

is

a

and

Flores

key

credit

elsewhere;

but




Balboa

Cristobal

related

also

it

OVERSEAS

CUBA

Rosario

,

London

Havana
402

-

Presidente Zajat

*

Cuatro Caminos
Galiano

Rio de Janeiro
Porto Alegre

Recife

Santiago
Valparaiso

La Lonja

Caibarien

COLOMBIA

(Pernambuco)
Salvador (Bahla)

117
'•

Old Bread St.

West End
II

CHILE

Bogota

BRANCHES

ENGLAND

Plaza Once

BRAZIL

directly to the economic progress
there, as. are the power loan:7
there

Buenos Aires
502 BarteUmi Mitre

CANAL ZONE

demo¬

country.

My special purposes in talking
of the Mexican railroad credit are
these:

ARGENTINA

Cardenas

Manzanillo

Santos

Barranquilla

Matanzas

Sao Paulo

Medellin

Santiago

fTaterUo PI.

JAPAN

Tokyo
Nagoya
Osaka
Yokohama

FRANCE
Paris

(International Bank¬

ing Corporation)
HONG KONG

Hongkong
INDIA

Bombay
Calcutta

PHILIPPINES
Manila

Juan Luna

REP. OF

PANAMA
Panama

Port Area
Cebu
Clark Field

MEXICO
PUERTO RICO

SINGAPORE

Singapore

Mexico City
54 Avtrtida
Isabel la Catdlita

Republica
PERU
Lima

was

Torrey

K.

with them,

Our credit there of $100

He

Renyx, Field

Chronic&e)

the result may be
very bad indeed
for us in all the
Orient.
not

L

&

Co.

a people
earnestly try¬
ing to rise and stand on their feet
are

J.

Co., 209-11

Street.

critical of

and

&

X.

associated

(Special to The Financial Chronicle)

LINCOLN, Neb.
Rouze

Co.

Chronicle)

Fla. —Francis

and J. S. Bache &

selling foreign-

would

Co., 207 East Las Olas

Boulevard.

long as
they

so

to

trade

Fla.—P.
and Ray A. Tip¬
joined the staff of A. M.

Geraci

Kidder &

afford

spark plug

We need friends.

LAUDERDALE,

Aurelio
ton have

United States

a

agency
the

as

can

be, and
they make friends for

as

goods in the United States.

what

the

act

intended

are

time I'd like to say

were

But

stop lending by

Government
loans

are

missionaries, just

as they
worst, if they were
to look on the foreign fields as
a
place to make money quickly.

could

natory laws.

They are the result
pride—perhaps a proper na¬
our
experience
and
sympathy
tional pride—and fear of some¬
knowledge useful to them.
We
can't afford, I think, to disappoint thing that is called exploitation.
Here and there I think there was
them, and if we are too harshly

hoping that they

tions.

of

send out to work

there

and

dealing

viduals

means

of this in

way

exclusive

security and prosperity require a
i
prosperous world;' if we want tq
freely we've got to buy.

sell

The

our

and

it

.

foreign

and

But

It

country.

welcoming

us:

too.

the progressive policies and
experience of foreigners with the

employing the device that did
for

that

but by

enterprise and

volves local capital.

for

roadblock in the path of

a

people

the

of

now

eager¬

best

can

done by the initiative and
ness

justification
is

progress.

And let me add by way of sum¬
atmosphere that caused it
is, I think, being improved, and mation: the job to be done can't
mainly not by any governmental be done by U. S. loans or U. S.
or intergovernmental
institutions, grants. But they can help. I don't

of

and

problems

economy

country.
That

stacles

economic

principle
only auxili¬
things moving;

start

can

the

we are

can't remodel the

great productive accomplishments
is manfully
facing difficult
and

illustrate

that, after all,

much

Somewhat the

to

serves

13

San Juan

Santurce

Arecibo

Bayamon
Caguas
Mayaguez
Ponce

URUGUAY
Montevideo

VENEZUELA
Caracas

Colfax.

&

The Commercial and Financial Chronicle
16

.

.

Thursday, November 8, 1951

.

(175G)

Dollar Gap

Business

Constitutes

Seen

Serious Problem to

Britain

Activity

The Mutual Security Program
And Foreign Trade

Continuing

At Favorable Level

By THOMAS D. CABOT*

EINZIG

By PAUL

Director, International Security Affairs, Dept. of State

Report of Business Survey Com¬
In calling attention to

forthcoming conference of Sterling
Dr Einz.g po.nts out

Area

Sees

the dollar gap,

tion

resumption of economic and finanassistance from United States.

cial

National Associa¬

Estimating the Mutual Security Program will cost American
taxpayers at least $25 billion, if needs are fulfilled, State
Department official defends outlays. Says by aiding free

of

Purchasing Agents finds
price structure stronger v/ith ten¬
dency to level off. Inventories

immediate solution

as

of the

mittee

d.ff.culties of remedying situation through further ""Inchon of
dollar imports or through increase of exports to Dollar Area.
countries to discuss

nations

declining all along the line.
According to composite opinion

Eng.—Representatives of the Sterling Area coun¬
tries will meet in London in November, to discuss the dollar
culties arising from the deterioration of their balances of pay¬
ments duringIhe third quarter of .1951 At the present rate of out¬
flow the gold reserve would decline to a dan¬
gerously low level by the end of next year.
Everybody agrees that effective measures must
be adopted to check or at least slow down the
LONDON,

first

The

question that will be

.

Any substantial cuts

Dr.

Paul

Einzig

considered will be

rest of the Sterling

avoid

fur¬

a

ther

sharp rise in raw material prices. They are beginning to real- ;
ize that they cannot have it both ways, and that the choice rests
between dollar deficit combined with lower prices and dollar sur¬

plus combined with higher prices. Britain could ill afford to lose*
much gold, but she could also ill afford to be subject to a further
rise in prices. In either case there is bound to be graye trouble

and

"

i

lies

in

"

resumption

the

'

of economic

financial

assistance from the United States, whether in the
military supplies in the broadest sense of the term, or a!
resumption of Marshall aid, or some other forms of loans.. It was
a mistake to
proceed with the repayment of the loan obtained from
the Reconstruction Finance Corporation at the beginning of the *

form of

Second World War.

The arrangement for its repayment was made

months ago, at a time when the gold reserve was still increasing.
Since the tide has turned the two governments concerned ought
to have agreed on a deferment of the repayment.

The

British

renewal

the

war

of

Government

Marshall

Aid.

would

More

reluctant

be

than

six

years

to

apply for a
after the end of

application for such form of assistance might be considered
There are several preferable alternatives." One of

undignified.

them is to draw

dollar facilities of the International Monetary
These facilities were suspended in 1948 on the ground that

Fund.
Britain

is

on

beneficiary under the Marshall Plan. Now that this
longer the case there seems to be no reason why the use of

no

was

the IMF's

a

resources

should not be resumed.

that the British Government did not repay
1947-48 during the period of gold influx.

Of

it is

pity
the amounts used up in
course

a

It would be now in a
stronger moral position to claim fresh assistance. Other
Sterling Area countries also could and should avail themselves of

much

their quotas with the IMF.

of

:

>

some

of the Dominions is good

some

The

enough, and there would

be

no
difficulty in elaborating capital investment schemes of a
kind that would appeal to the Bank.
Britain is likely to receive materials and
equipment from the
United States in connection with the North Atlantic Pact.
It is

hoped in London that such assistance would
liberal scale in the interests of rearmament.

be

forthcoming

on

a

Otherwise balance of

payments difficulties might frustrate the efforts to carry through
the £4.700 million scheme
according to schedule. Another form
which American economic assistance could assume
would be an
increase of Britain's allocations of scarce raw materials.This is

essential, because shortage of essential
to

a

reduction of the

available

for

raw

materials would

lead

arms

output and also of the volume of goods
export to the dollar area and other hard currency

own

salvation, irrespective of

any American aid. They could
drastic reduction of civilian consumption at home. To
that end it would be
necessary to curtail consumers' purchasing
so

by

power.
nal aid

a

In the absence of such curtailment
any practicable exter¬
would be in the




long

run

a

mere

a

ly

C.

Swanton

access

material

num¬

slavery

in

needs

it

isolation

to

or

It holds in

war.

the

of

posi¬

virtually all

one-third

over

population

to

resources

live

to

destructive

wage

of

globe.

the

By

a

ruthless slave labor system, it has

of

built

powerful industrial estab¬

a

lishment.

speak¬

erally

States

both

In

have

equipment,

It has

the

up on¬

part

a

The

the most
we

strong geographical

very

either

way.

because

put

I

much

point.

antagonist

confronted.
and

tion.

perhaps

Its leaders

are

fired by

strong faith in the inevitability
especial¬
Thomas D. Cabot
of. the ultimate triumph of world
of October in;
■
•> ''
ly in the imCommunism.
Although our su¬
dicate
the
slight improvement p o r t a n t
which developed in September is European area, we are supplying periority in atomic weapons is a
strong deterrent against aggres¬
being maintained.
Order back¬ only a part of the heavy arms
logs continue to decline, but at a and equipment, whereas our allies sion, the recent atomic blasts in
slower
pace.
Where necessary, are supplying not only the troops Russia indicate that this deterrent
is being counteracted by increased
production is being adjusted to but most of the individual equip¬
lower demand, but is still higher ment to those troops such as uni¬ Soviet capacity in producing
than is warranted by the order forms, tents, small arms and am¬ weapons of mass destruction.
Moreover, the men in the Krem¬
part
of the
position of many plants. The de¬ munition, and ~ a
lin have achieved a tremendous
mand for holiday goods has picked heavier equipment.
success
in
identifying
up somewhat, but not to the nor¬
It is truly a mutual program political
mal seasonal volume, and much of and in no sense are we employing their movement with a remedy for
social inequities where such in¬
it can be filled from stocks. De¬ mercenaries for we are
helping
fense production is growing.
The others to defend their home lands equities exist and in deceiving a
Purchasing Agents' consensus is which in turn
helps us to defend large number of people about the
Robert

month

the

a

ing,

'

.

drop in the

ocean.

.

of it, and our home land. It is a basic in¬
has any tyranny been so success¬
spread, if hardships m strument of
American
foreign
ful in stealing and perverting the
some
regions are to be avoided.
policy, which aims at protecting
Inventories are declining all along
basic symbols of our own civili¬
our national
security by contrib¬
the line: raw niaterials, work-inzation—the ideals of social justice,
uting strength to other nations
process, and finished goods.
The whose strength is a part of our human equality, and economic
price structure is stronger, with a own
progress.
Among millions of un¬
strength. The kinds of as¬
tendency to level off.
Employ¬ sistance
given in each area and derprivileged people throughout
ment is high, but spotty, as much
the world, the Kremlin has planted
each country are tailored to the
short time is
reported.
Buying
the belief that acceptance of Rus¬
particular problems and needs in
policy is unchanged, and is strong¬
sian leadership will mean the end
that
area,
and
are
conditioned
ly on the conservative side.
of foreign domination, of feudal
upon the prospects for effective
Overall, business is good and use of the assistance. By far the landlordship, of industrial slavery,
is expected to
continue through major portion of American aid is or racial inequality and of recur¬
rent economic
November.
December and first- made
insecurity.
It is
that there must be more

of Communism.

true aims

Never

wider

a

up

of military end-items—

1952 conditions will de¬
(1) the movement of
finished goods stocks by the holi¬

tanks, guns, planes, and other cap¬
ital military equipment. However,

day buying; (2) the allocations of
first-quarter controlled materials

smaller amount of complementary

quarter

pend

upon

for civilian

which

at

uses,

and (3) the rate
orders can be

defense

in these

brought into production
months.
Hf.■/. v-.Q.;:

Prices

Commodity

Production material prices have
shown

more

October

in

strength

aid

the

includes

also

program

a

three

next

it is

years,

that

mated

least

at

now

$25

esti¬

billion

month since April.
will be needed.
The general trend, however, is to
;This is a lot of money, but it is
level off, rather than any definite
upward '/movement.
More OPS only about one-tenth of our total
and
a
little more
calculated prices are in evidence defense cost
2% of our gross national
this month, but most of them have than
than

in

any

not been tested
mand

cents

two

by supply and de¬
OPS increase

The

factors.

per

pound

on

lead

and-

zirtc, still below world price,
forecast necessary price increases
in the lead and zinc products and
Failure

scrap.
creases

at

once

tion of many

to grant such in¬
held back produc¬

essential items.

negotiations, in view of the pro¬
ducers'

that

announcement

any

increase must be immedi¬
ately reflected in steel prices. If
allowed, it will probably indicate
some ceiling price lifting on other
products which customarily follow
steel's wage and price pattern.
wage

materials inventories increased

Production

reduced

for

more

all forms

year

for tobacco
we spent

of

foregn aid.

It is

useful to recall that the to¬

even

tal

last

money

television sets than

and
for

Americans spent

of

cost

the

program,

as

now

estimated, is less than one-twen¬
of the
to

war

total

But

us.

of

the last

fact

orders,

I

sum

can

is

very

be justified

believe

review

page

36

pastures of Communist

green

two-pronged attack.

It confronts

all nations with the constant threat
of military

aggression and simul¬
confronts
them with
danger of a Communist political
victory if they ignore social and
taneously

conditions.

economic

-

„

The second major premise upon
which

the

gram rests

Mutual

Security

Pro¬

is that the Soviet threat

can

be held back only by

On

this

can

be

strength.

point also, I think there
little

disagreement.

Be¬

the Soviet imperialists pre¬

cause

fer

to

and

because the

gamble

a sure
thing,
ruling clique are

on

the

that

four

great,

is.

it

and

only if such

I

basic

want

to

premises

which the Mutual Security

a

grave

this

hope

threat to the survival of

strength represents our only

of victory in the event the

Kremlin should decide, regardless
the

of

First is the fact that there exists

to

odds,

launch

global

a

war.

Our

third

basic .premise is the

fact that the United States cannot
by Mr. Cabot at the First

General Session of

eign
on

the

see

deeply concerned about the selfpreservation of their regime, we
have a good chance to avoid war
an expenditure is necessary to our
altogether if we can rapidly build
national security.
the total political,
military and
economic
strength
of the
free
Basic Premises of Program
world. And we can be certain that
the

that

that it

♦An address

of

to

promises, but it is not so easy for

remains

cost

the

schedules

lack

Continued

in

the

to point out, of

easy

we

Program rests.

Inventories

were

that

course,

The rate of decline in purchased
October.

It is

product.

tieth

Purchasing Agents are watching
for
developments in steel wage

Americans

for

easy

bear-trap that lies hidden beneath

economic aid, technical assistance, people whose living conditions are
intolerable.
To them, any pros¬
loans, etc. ■
,a',;:.','-'.
pect of change arouses hope for
During the current fiscal year,
improvement. By the time the vic¬
the Mutual Security Program will
tims of Communism realize they
cost the American taxpayers about
have accepted
something worse,
$7.3 billion. In order to complete
it is too late. Thus, the Kremlin
the
entire
program
during the is able to maintain a continuous

upon

Needless to say, Britain and the other Sterling Area countries
themselves could and should make a
supreme effort to work out
their

de¬

the cost. Gen¬

the

in

way

only

be

its standing
army and air force are the most"
powerful in the world. It occupies

It is the

est
we

areas.

do

bers

re¬

world.

can

this

about

dangerous

tt is the cheap¬

New

,of

Alternatively the Sterling Area countries, or at any rate
them, could apply for loans by the International Bank.

credit of

ever

the

there

the

and

free

,

"continue to remain aloof from the market in order to

solution

u

think

argument

appeal

to

the

of

Soviet Empire is by far

pro¬

business¬

us

States

United

mainder

which

and

Conn.,

for

Canada, they depend in part on the
level of raw material prices and in part on the willingness of the
United States Government to pay the high prices for materials
acquired for stockpiling purposes. Most people in Britain, .experts
and laymen alike, are facing a dilemma. They don't know whether
to hope and pray for a resumption of heavy American stockpiling
for the sake of checking the drain on the gold reserve, or whether
to hope and pray that the American official buying agents should

.

group of business¬
I feel it is a hard-

fend ourselves

ries,

d

United

Area to the United States and

.

st

n

trends

successful dollar drive.

'

headed

for

business

in Canada met
in some lines
there is a possibility of increasing dollar earnings, the total in¬
volved can only be an insignificant fraction of the $300 million
lost each year through the nationalization of the Anglo-Iranian
Oil Co. The priority of rearmament necessarily limits the chances

immediate

a

because

men

cheapest

Olin

Inc.,

from promising. The sales of British automobiles
recently with an unexpected reverse.
Although

As for the chances of the exports of the

of

Haven,

the possibility of increasing exports to the Dollar Area. As far as
the United Kingdom is concerned the outlook in this respect is far

The

don't

men.

Win¬

I

in

of dollars on luxuries such as
films is likely to be resented by
American opinion. The second question to be

ahead.

Program to

to

Swanton, Di¬

vision

the expenditure

a

the

should

is
C.

peating Arms
Company, Di¬

imports

little scope for a reduction of food

Calls outlays "an investment in peace."

It is always a pleasure for me to
talk about the
Mutual Security

gram

chester- Re¬

Hollywood

of

Chairman

Robert

chases,

possible to curtail fur¬
ther dollar imports. Most governments are ex¬
pected to answer this question in an emphatic
negative. The cuts made during the crisis of
1949 have not been restored, and there is very
little scope for further substantial economies
in dollar imports. In fact the import of raw
materials and equipment may have to be in¬
creased as a result of the rearmament. There is
from the Dollar Area.

Purchasing Agents' Business Sur¬
vey
Commit¬
tee,
wh o s e

receiving in return vastly increased opportunity

are

,

examined

is whether it would be

very

agents who com¬
the National Association of

prise

rector of Pur¬

?.'■ ®

decline,

of purchasing

we

for survival.

,V.

Oct.

the 38th National For¬

Trade Convention,
29,

1951.

New

York City,

"go

it

alone."

terested

in

You who

foreign

are

trade

in¬
will

hardly need to be reminded of our

Volume 174

Number 5062

.

.

The Commercial and Financial Chronicle

.

(1757)
dependence
world.

the

on

Despite
of

power

the

of

enormous

need strong and

we

de¬

termined allies in all parts of the
world.
We

Americans

to be proud

son

resources,

have

of

good

tremendous

our

technical

our

rea¬

genius,

and the courage of our people. We
know—and hope both our friends
and enemies will remember—that

will

we

stop fighting for our
freedom, whatever the odds against
us

be
a

never

However, it would not

be.

may

pride, but stupidity, to

which would eventually
standing alone against a
enslaved
by
the
Soviet

us

world

Union.

Our

population

is

only

one-fifteenth of the world's total.
We need many

that

terials

important
Our

continent.

this

on

become

inseparable

Own.

fourth

and

essential

premise

allies

abroad

are

not

capable of developing the strength
they need—and the strength we
need-— without

American

assis¬

tance.

They do not have enough
money—they do not have enough
resources—they do not have ade¬
quate industrial plant—and, most
of all, they do not have enough
time.

Western
is
of

the

the

United

Europe, for example,
strongest and richest part
free

world

States.

does not have

It

must

precious

use

dollars to buy these

that underlies the Mutual Security
Program is the fact that our
friends

materials.

But
an

trial plant for the
of

outside
even

the

Europe

adequate indus¬
mass

production

the defense weapons needed.
It does not have
enough tools and

structure

price

not greatly

is

dif¬

things, and it
get dollars only by selling to
the dollar market, which in turn
diverts production facilities from

ferent from

defense purposes.

aid program costs America about

can

The

ginal

low

incomes and the

standards

of

living

mar¬

of

the

people represent a basic
an
adequate defense
program.
The gross national in¬
come of the European members of
uropean

fibstacle

to

the North Atlantic

Treaty Organi¬
zation is only enough to provide
the average citizen with an annual
income of $500, as compared with
an

average of

States.
come

all

the

it is easy to
understand the heavy burdens im¬
posed even by a moderate defense
effort. As I

2%

sum

of

expenses

must

life—

of its

own,

mentioned, the foreign
national product,
average
citizen

gross

which

for

means

2Vz%

the

of

to

if it possessed the
necessary pro¬
ductive facilities and raw materi¬

als, would require

a

bite in

income of about

an

average

men,

Europe

this

point

income of the

Soviet

be faced with

In

Nazi

squeezed

or

Communist dicta¬

below

the

level

the ruling clique.

housing,

point below which
can

very

large

We

must

also

the

destruction

War
a

torship, of course, incomes
if it

subsistence

the

serves

be

can

of

purposes

But there is
no

a

free nation

reduce consumption.

And

ask

can

terials

and-

against

us.

supply

a

of

II

have

despite

up,

effects

not

the

made under the

yet

Continued

and

ma¬

three

hundred million people,

including
the world's largest single pool of
skilled manpower. They have ap¬
proximately two million men un¬
der

arms, and millions more
trained reserves.
They occupy

vital

strategic

in
a

position,

both for
defense and counter-attack against
Soviet aggression.
They control
the largest and finest group of
ports in the world. Most important
of all,

Western Europe's potential
the balance of indus¬
power between the United

represents
trial

States

the

and

Soviet Empire.

Today, the combined coal
the

of

duction
Western

United

is

Europe

pro¬

States and

three

nearly

times that of the Soviet bloc.
if

Soviet

the

Union

got

of Europe's coal resources,

But

control

it could

the United States by
nearly two to one. The combined
steel
production of the United
outproduce

States
and-Western
Europe is
nearly five times greater than that
of the Soviet

bloc

with

bloc, but the Soviet
Europe would

Western

approximately equal
production. The same

steel
result is

our

obtained
by comparing
many
other vital industrial commodities.
All told, the conquest of Western
Europe alone would immediately

double
the
Soviet
war-making
potential:
Simultaneously, such
a conquest would eliminate Euro¬
pean influence from large areas
of Africa and

Asia, upon which we
large part of our
manganese, tin, rubber and wool.

depend for

a

These facts help to obtain

why

the United States has tried to pro¬
tect its own security by giving

amounts

large

military
Europe.

of

economic

OVERSEAS BRANCHES

FOR

WORLD-WIDE

BANKING

SERVICES-

Frankfurt/Main

Heidelberg
ff

Most of the countries of the Near

East, the Far East, and Africa are
underdeveloped economically, and
their conquest would not be as
immediately useful to the Soviet
machine

as

Western Europe.

of

these

the

conquest of

However,

countries

rich

in

many

and natural resources, and
victory for Communism in any
mean a
long-term
gain for Soviet power. It would
a

the Chase maintains close

contact

with

every

important part of the globe. As a result, the Chase
a focal
point of banking information and

human

Asia and

Africa, who

are

just be¬

Panama
Colon
-

•

David

Cristobal

service both for individuals and for businessmen,

great tragedies of
history if the peoples of

Santurce

commercially

be

the

San Juan

Through its branches, representatives and correspondents,

is

of

Osaka
Havana

of them would

one

•

Marianao

man¬

power

Stuttgart
,Tokyo

/

apply to other parts of the world.

war

London

and

assistance
to
Western
Similar
considerations

Balboa
Offices of

Representatives

with interests here and abroad.

Mexico, D. F.

ginning to rise from ages of op¬

Buenos Aires

pression and breathe the fresh air

Rome

of
a

freedom, should be subjected to

tyranny many times

that

from

suffered.
are

gle

*.

which

All

of

worse

than

they have

ever

these

Sovietism, and their




OF THE CITY OF NEW YORK

Cairo

Bombay
THE CHASE BANK

countries

important assets in the strug¬

against

THE CHASE NATIONAL BANK

Member Federal Deposit Insurance

Corporation

of

eco¬

very little economic fat has been

we

arrayed

.than

progress

halted, but

this point, let us
single area—Western
The countries- of free
more

that

World

been made

Program. The threat
nomic chaos has been

one

have

of

ery

<

Europe.
Europe

sacrifices.

European Recov¬

illustrate

To

no

great

Western Europe Resources

consider

is

its people to

new

system would

manpower

citizen

remember

tremendous handi¬

a

such

with

cap

In

citizen,

government
make

if the

machine

war

free enterprise

with.

average

industrial

the

to

close

already
approximately the same as in the
United states, and where the real

potential of the
Eurasion continent were harnessed
our

uz

very

begin

unequalled
would

be overshadowed

now

total

U1C

were

to

countries like France and
Italy,
where the total
proportion of in¬
come taken in taxation
is

7% additional

$500.

armaments, governmental services

view of the fact that the European

of

to

$2,000. In order for Europe between one-fourth
and one-fifth
carry this expense alone, even that of the
United States

and capital

investment, as well as
clothes, and bread.
In

income

an

«

Western

about

$1,916 in the United

And out of this

our

establishment

industrial
even

raw ma¬

found

be

cannot

has

our

The

pursue

course

leave

strength
from

country, actual and

our

potential,

rest

the

17

Paris

;

on

page 26

18

The Commercial and Financial Chronicle

(1758)

Continued from page

I got a quick smile

lawed and taxation by the consent

quicker reply.
The reply
was: "It is just a big cover-up for
bad money. We would be lots bet-

of the taxpayers was insured,
In 1913 the Sixteenth Amend-

all about.

was

7

and

Dangerous Trends in the

a

off without it."

ter

To that I

repealed these strict safeguards by authorizing the taxation
ment

can

.

.

Thursday, November 8, 1951

.

the generally expected prospect is
that the burden will be long en¬

during.

In such situations Ameri¬
prone to tolerate curtail¬

cans are

ment of their

liberties, assumption
authority by government not
per capita distribution.: Most un- ordinarily
permitted, and resort
.*ax Despoliation
fortunately it did not additionally to. fiscal and monetary devices that
I have time for the discussion provide that income taxes levied transgress our peacetime ideas .of
'vof but one more dangerous trend, should be at uniform rates, geo- the appropriate.
"honest money" in this fair land They are prices that buyers are
But it is exactly in such situa¬
voluntarily willing to pay in the It is the use of the tax power to graphically and with respect to the
ours the prospect both of inflation and of significant depression light of what other buyers are destroy the unique system of max- tax base, thus insuring that the tions that the dangerous trends I
J *
willing to pay for the same thing; imum possible incentive to indi- taxes would conform to the moral have been describing gain hidden
would alike be forever banished.
while
simultaneously- they
are vidual thrift and productivity that law established by Moses and hon7 impetus
that
could
eventually
^
The modern printing press procThus in the
prices at which sellers are willing lies at the heart of the American ored in other forms of taxation, prove irreversible.
1: ess is briefly as follows: The govto sell in view of what other sell¬ civilization and has been respon- The door was thus opened to se- decade of the 1930s these
trends,
! ernment, quite understandably
ers
are
charging 'for the same sible for the growth of its produc- lective taxation and discourage- in the judgment of numerous stu¬
wanting to engage in favor-currything. They are prices achieved in tion beyond the wildest dreams of ment of superior initiative, pro- dents, had already developed to
ing spending > w h i l e
avoiding the absence of fraud, coercion or other times and places. It is the duction and thrift—that
is, to ero- the point of fastening a condition
only add, "Amen."

American Economic System

_

".

„

income without regard to its

of

sion of the mainspring of our systern. At the time no one thought

of

that the income tax rates

was

"of

_

"

..

-

'

/equivalent and unpopular taxamonopoly abuse.
They are all story of the deep violation of the
tion,. "discovers" ah emergency
four-square with the moral doc¬ moral principle that there was to
and authorizes expenditures in extrine that each is entitled to the be no stealing—even through the
cess of the taxes it levies.
To covfruits of his exertions to consume government. It is the story of the
er the
difference if expands the
or
dispose of as he sees fit in massive redistribution of income
[ national debt and has the Bureau voluntary exchange for the fruits coercively conducted by governof Engraving print up the addiwhich
has
of others' efforts.; Dictated prices ment
recently been
tional bonds.
If individuals and
•

.

were

to

permanent

unemployment on
an unemployment
that
only dissipated by the coming

the '

land,

.

be

more

than 2%

*

four-square with the way
corporations then buy those bonds
things are done in Russia.
by writing checks against their
Competitive prices perform fun-v
own deposits, there is no inflation
damental functions. They are the
of the money supply and no gen¬
sensitive and wonderfully efficient
eral
inflation of
prices in the
means
of continuously directing
markets. It is a transfer of exist¬
manpower and resources into the
ing deposits to the government,
production of the most wanted
not the creation of additional de¬
goods and services. If more mouse¬
posits to compete in the markets
traps are wanted their price is bid
for the existing supply of goods
up, thereby provoking an enlarged
jf and services.
'
,;
production. If fewer mousetraps
But it does not stop there. More are
wanted, their diminished sale
bonds are printed up than people, deflects
productive power into the
care to buy in view of the unat¬
providing of other more wanted
tractive interest rate and of the
goods. Competitive prices are thus
i dollar having been cut loose from the guardian of progress. They
gold. So the overflow of bonds is are
/ also
the guarantee of effi¬
lodged with the commercial banks. ciency, for the inefficient is penal¬
This is the effective monetization
ized
by loss on his production,
of the debt which can proceed un¬
whereas the efficient is rewarded
restrained in a country which has
with
profit. Competitive prices
made it a crime for anyone to own
are also
our only means of dis¬
monetary gold? What happens is
pensing economic justice to all the
that a commercial bank in buying
people all the time. In such com¬
the bonds pays for them quite sim¬
petitive markets the worth of each
ply by pen and ink entries on its
person's product or service is con¬
books serving to write up or in¬
tinuously judged by all the buy¬
crease the deposits of the govern¬
ers and he is compensated in ac¬
are

all

characterized by the National Bureau
of
Economic Research "as

These

ment.

thus brand new

are

deposits unmatched by new goods
in the market, but which never¬
theless
bid

flood

into

markets

the

to

the prices
of existing
goods and services as the govern¬
ment spends or gives them away.
up

is

This

necessarily

a

most

sketchy description of the process.
A full exposure of the monetary
manipulations involved would be
interminable. But it is not

;

,

i.

neces¬

technicalities

of

either

abuse

destructive

of,

and

pf

npt

the dollqr
deficiency

dangerous trend.

1

It is the attempt to hide the

;

sequences

of the

issuing price control decrees,

;

forceable
ment.

,

by

fine

This is

coercion

for

the

con-

debasement
and

by
en¬

imprison¬

substitution of

competition

in

the

market
very

place and strikes at the
heart of the American eco¬

nomic system.-

•

\

J

be called

phasize

voluntary prices to
their

essential




em¬

confis*

for

possible

taxation

of

of

individual

income

small

that

no

other

the incomes

we

incen¬

progress,
has neverthe¬

less gone on apace through the
pe¬
riod.
We must now soberly ask

ourselves
at

if

true

a

home

full employ¬
readily achiev¬

is

able
or

in

the absence of

costly

war

its prospect abroad.
;.
Thus
the
possibility that

the

world may be an armed camp for

taxation

a

ex-

reason

as

an

ideal

means

of

that

time

scrupulous

petitive) production,

are

remember

long

to

come

is,

to

my

making, to use his words, 'desr mind, not an excuse for relaxing
potic inroads on the rights of the moral tenets of the American
property, and on the condition of civilization; it is instead an im¬
bourgeois (that is, private, corn- perative reason for their more

Kipling's "selected Peter" is now ported.
taxed up to nearly 90% of his in- ourselves
When

needs

peacetime

1

destruction

.

larger
But we do not have to accept
than those of the average voter, the
evidence
of
Marx
unsup-

come.

for

which

of

that Karl Marx in that document

from

increased rates for

than

war

selected steep progressive income

either

are

tives

destruction

It

paying, or
pay very little, and, secondly, that
successive
increments
of
larger
incomes are taxed at progressively
entirely

empted

the

voters

income.

first, that many

provides,

The

war.

rfionetary inflation have ob¬

scured

moment

We
can
see
by
supposing
that

our

ance

and

constant

observ¬

the precious citadel of our

as

productive power and progress, on

which alone
we
can
enduringly
it for.
\for
k rely for peacetime prosperity and

civilization national

survival

in

a

hostile

had been founded on the simple world. This is more greatly the
he's-got-it-let's-take-it morality case because I judge the purpose
of the Kremlin is less to meet us
of the robber instead of the thou-;
shalt-not steal morality of Moses, in direct warfare than it is to in¬
Such a system would have said to duce us suicidally to undermine
those living under «it, "If you pro* the moral and economic sources of
duce or save more than your our productive strength. The men
neighbors, the policeman will take in the Kremlin, as well as we in
it away from you and give it to this land, know that an alerted
those who produce or save less America, preserving its principles,
man
gets in exchange the exact realize this, then we are indeed than you do." You instantly per- can always outproduce and out¬
equivalent of what he gives as hard put to it to justify the com- ceive that under the Iron Law of fight the slave state armies—we
judged by the most comprehen¬ munity's turn-around tax seizure human behavior, those able to have dealt with would-be world
sive, most continuous and most of the income dollar equivalent of produce more, being denied incen- conquerors before. And we are
democratic bar of judgment con¬
major proportions of the output of tive for so doing, would not exert alerted on that score.
ceivable. When we substitute coer¬
But can we truthfully say that
its
more
productive
members." themselves to that end. Similarly,
cion
we

under

for

thus

discard

progress,

under

popular

sovereignty,

ruption of administrators and too

often

scarce''

despite
record-breaking
production, and so we build a

framework of seeming plausibility
for
bureaucracy, dictatorially to

in and

step
even

not

boss

distribution,

socialize industry.

believe it

—

If
just look

you
on

or

do

the

other side of the Atlantic.
I noted

control

nature.

a

competitive markets no one
gets a money income in this land
except: as compensation for his
goods or services, voluntarily paid
him by the community at the
cordance
therewith.
With
the
community's own price, and thus
money he receives he can then realize
that justice has thereby
buy the products of others as been done—that the community
similarly valued in those markets. and the individual are quits with
Under
voluntary
markets, each each other at that point—when we

moment ago

a

was a

Competitive prices might better debasement.
r

become

ment

„

And so they wrote into the Consubstituting^ privilege or stitution in three different places
"pull" for merit in obtaining prod¬ that all direct taxes, of which inin, monetary authority
ucts. While simultaneously holding
come
taxes are the most direct,
Price Coercion
>'
j prices down and keeping money hiad to be distributed on a, per
From the trend toward dollar artificially abundant we also quite capita basis.
The theory was, I
everything look
debasement there derives another naturally make

debasement

now

catory

,

tion,

gerous

as

the tax has

.

wise be producing useful things.
well knew the dangers of tax tythey want the trend arrested ja
We incite the creation of black
ranny.
"Taxation without represimple legislative mandate to the
markets in which man-hours and
sentation is tyranny" was one of
monetary authorities either to halt
money are wastefully utilized., We the.
or severely limit the
slogans of the Revolutionary
rate of ex¬
enforce
time
consuming
queue War.
pansion in the*money supply is all
They well knew the temptalines on the law-abiding, but re¬
that is required. These authorities

reflects

urging,

.

ward the law breaker.
We build
for majorities to get together and
already have, and have had all
disrespect for law by giving big vote taxes on minorities without
along, more than ample power to
power to small men, inviting cor¬
halt monetary inflation. Our
similarly
burdening themselves,
darj-

[

moderate.

or

years

Spearheading the taking, in thjte JnJ-848'
government-conducted taking and
- Thus all Communists realize, algiving process, is the progressive though few Americans seem to,

.

-

;

many

and

competition in markets, There is, in fact, no justification
the guardian of in
morals or in the principles of
the guarantee of effi¬ our civilization
for
progressive
printing press or gold-standard ciency and the essence of liberty.
taxation.
It is the simple looting
money to put an end to the trend We substitute wholesale
injustice through law of the more productowards dollar debasement. If they for automatic
justice and use the tive by the more numerous but
really want honest money ft is police to enforce that substitu¬
less productive. Its appeal is demsufficent for them to put their fintion.
We throw away the most
agogic; its morals are those of the
ger on the end result and know democratic feature of our
economy
burglar, and its effect is increasthat honest money means an end
and we prevent rather than pro¬
ingly to punish, as if by fine, those
to the endless expansion of the
mote wanted production—for who
who produce more of the goods
sum
of
demand
deposits
plus will produce more if it has to be
and services wanted by the com¬
pocket money, regardless of any sold for less than it
is worth?
munity than do their neighbors.
and all behind-the-scene manipu¬
We
do
more
than
that.
We
We may gain some insight into
lations.
These figures on the
waste
manpower
and resources. how
dangerous this progressive
money supply are published every
We
burden
the
already
hard- punishment of the productive is
month
in
the
Federal
Reserve
Bulletin and by watching them pressed taxpayers with an ever- to. the functioning of the' Ameriswarm
of administra¬ can economy by going back over
each can check up for himself on mounting
tors and agents who might other¬
the record. The Founding Fathers
dollar debasement at its source. If

everybody to understand

sary for
all
the

for

punishment of people for
one of the great social revolutions
being productive. It is a devourer
of history." It has been the prom- of the seed corn of progress. That
ising,
to
use
Kipling's
words1 is exactly as the Communists seekof abundance for all by rob- ing to overthrow our system wish
bing selected Peter to pay for col- it to be, as may be observed in
lective Paul."
the Communist Manifesto, issued

<

i

deed,

3%.

And, in- of war. Ever since then we have
they were been
engaged
in
waging
war,
But under demagogic making good the war-accumulated
foreseen by Macaulay, backlogs, and now in getting ready

>

ion alone.

the less productive, r by getting
something for; nothing, would
have diminished incentive to produce as much as they could.
Inshort, people would be diverted
from the pursuit of individual
productivity to the competitive
practice of getting something for
nothing through the government',
Is there something faintly fainiliar
in this picture?
The end result of such

an

econT

Minorities

were

thereby

pro-

a

keen-minded

control

—Le
ings."

Gods

of

The

Copybook Head-.

and

adopt the very de¬
debauchery
progressive taxation, specifi¬
cally selected and recommended by

vices,

like

currency

the

Communists

ideal

instruments

themselves
to

self-destruction?

our

fact, been

so

bring

,

as

about

Have we, in

preoccupied with the

immediacies

that

we.

have

lost

sight of the moral principles that

it took three thousand years to
would, of course, be declin¬
production leading towards develop and finally focus—for but
once
in the history of humanity
chaos into which the policeman,
—in a republic of free men?
Do
armed with monopoly power to
we

think

we

can

must

now

"outsmart"

the

would step to force every7
principles and yet preserve, the
body to produce as he ordered—
proven benefits of their observ¬
and he would then arrogate the
ance?
Can
we
really out-steal
monopoly of taking without payeach other into permanent Utopia?
ing unto himself. Once such takI think not.
ing through government is tolerT
Yes, we are well alerted to the
ated, it eventually and inevitably
immediate and obvious military
becomes theft for the benefit and
problem but not equally so to the
perpetuation of a ruling class at
the expense of a systematically continuing and hidden erosion of
our system.
I know it is easier- to
exploited
populac^ largely de^
make a gun and shoot it
_art an
prived of individual incentives to
enemy than it is to discern high
be
productive - and thrifty. This
principle and religiously adhere
we do not have to take as an unto it. Yet, as we love our children
tested theory.
In our own lifeand grandchildren, it is the, latter
time we have seen it actually hapcoerce,

that

we

pen

far made

no

reference to the fact

by the willingness of the that, this nation is currently enby-product of dollar majority voluntarilv to, tax itself gaged in bulldmg an immense
mainritv
voluntarily to tax itseil.
gtock Qf the weapons of war
At
This is not my opin¬ Thus tax
despoliation, was putj{ best we exist in an uneasy peace

I asked

embrace

and

ing

that price tected

friend of mine What price

equally alerted to the dan¬
of internal erosion when we

are

omy

in Russia.
Over there, you
recall, there was a Communist
suppose, that every one had one revolution. But the promised Utovote and that every one should pia was almost instantly super-/
therefore pay the same tax voted reded by a sterile totalitarian dieby their representatives.
Voting tatorship as savage, as bloody and
for and
paying taxes were tied as godless as history records,
together.
That way no majority
The War Excuse
could vote a tax on a minority
without
In these comments I have thus
similarly burdening it¬

self.

we

gers

a*d

a™ing aSain-

The burden of defense

is

great and

do.

.V* 4

With Putnam & Coi?
;
(Special to The Financial Chronicl*;)

HARTFORD,
Conn. —Leb' F.
Varasconi is with Putnam f& Co.,
6 Central Row, members of the
New

York

Stock

Exchange.

Joins Thomson McKiiifton
Vfitoecini

FT.

to

fhi

Financial

Chronicle)

LAUDERDALE,

Fla

1
—

George L. Williamson has become
affiliated with Thomson & McKinnon, 3?3 Southeast First Ave¬
nue.

Volume 174

'Number 5062

.

.

*

The Commercial and Financial Chronicle

Continued frorti page 13

;

(1759)

they 1 were merely getting "dollar America is also in it for the returns we expect to receive.
aid" from their Uncle Ben!
Our free competitive system is
In* order to ,get on >with their

19

EflyfaMfl C

Pore An*
CUlfulll Si ■ dl oilIIa

*

,

to

If

.government program of
tured. Nothing less than this can must guarantee these sources and technical assistance is looked at in
provide the incentive to that ini¬ the lines of communication for this light it is on the right track.
tiative and efficiency upon which ourselves, of our own accord, or As I have already pointed out, II
economic: progress, is.built. i.The: forhOs iii' the world hostile to the am for technical aid in principle.
processes of exploration, research, American system will take over. But if government plans to use the

inventionr and experiment are all
characteristic of free private en¬
terprise.
"And

without

such

economic

freedom, without substantial free¬
dom of the individual to seek his

living where he
to venture his

can

means

find it, and
where profit

likely, and to be obliged to
no man for this—without these, it
is pure delusion to imagine that
political freedom, even if it exists,
can long endure!"
seems

Governments Cannot Create
It also

has

our

,

Now let

Side of Picture

us

believe—and there

consider the human

to

sons

are

many rea¬

support my view—in the

that gov¬
create
wealth

side of the picture in the less pro¬
ductive countries of the world. We

workability of the idea.
There is a further thought that

apart from the wealth of the gov¬
erned, or provide for their people

have all read that the per capita

I would like to pass on,

ernments

cannot

r

«.

.

fices

must see that

We

wisdom.

,r

in

the

Union

the other fellow gets a
of the

profits

fair share Building to act
that the citizens

so

and it ap¬
purchasing
power
in
China plies especially to the American
as well as the people can provide
amounts
to
only $19 per year, business man. In essence, Point IV
for themselves.
while in India it averages $28. Yet is a long-range
program, but we
Fundamentally-, our American these two nations together com¬ Americans like to rush things. I
system and our American way of prise about one-third of the entire sometimes
think
we
rush
too
life are a concept handed down world's population.
much! It is my belief that we get
to
us
On the other hand, the average better results in
through centuries of the
foreign fields if
Christian era by men and women American earns an income after we
do
not
try to accomplish
who loved God. They
taxes of $1,350, according to last
believed, as
everything overnight.
And
we
we do now, that man is not a ma¬
year's figures. In this comparison must bear this thought in mind
terialistic being but a spiritual one we see a startling example of in¬
particularly in our dealings with
—and that the worth and
dignity equality — the kind of inequality the less productive nations.
of the human soul are worth
fight¬ that is creating so much unrest
However, the Point IV program
ing for.
If
these
beliefs
ever
today in so many regions of the has a
big feature which in my
should be abandoned, the human world.
These differences in per
opinion makes it especially valid.
race will return
again to the bond¬ capita income are, of course, di¬ It offers a
challenge that the
age of mob tyranny.
J
rectly related to a nation's produc¬ Communist world
is not well pre¬
This concept of the American tive and economic power.
pared to meet, or willing to meet.
How can the less industrialized
way of life has its roots in our
Will Rogers once described the
Constitution and Bill of Rights, nations best increase this rate of
Communists as "people who have
and men of good will
Expanded produc¬
everywhere productivity?
nothing, but believe in sharing it
cherish these two great charters tion means the ability to convert
with everybody." While this may
in the age-old struggle for human raw materials by the efficient use
not be as true
today as it was
of mechanical energy to augment
freedom.
when he said it, the philosophy
Today, because of Communist human effort. In other words, it behind it still
holds.
For it is
aggression,
we
again
face
the is the process of coordinating na¬
pretty plain that the Russians do
threat of the loss of our way of ture's riches
and
man's
intelli¬
not have the expert technicians to
life
and
of
our
freedom.
The gence to increase his output of
spare, the potential capital to in¬
forces of evil which are attempt¬ goods.
vest, or the desire to share their
This then means getting more
ing to destroy us can be seen
technical ability with the rest of
everywhere.
By open insult and tools and machinery into more
the world.
by whispered slander, those who hands and training more people
On the other hand, we have all
seek to tear down our
way of life to use them. The need for,the cap¬
of
these
things in overflowing
are
saying that our method of do¬ ital to do this is unlimited. But
measure.
Therefore, if it is man¬
ing things is a capitalistic scheme we in America will have to sup¬
aged with a sense of proportion,
to exploit the masses. Those who ply most of it, and we cannot get
the
Point
IV
program
gives
listen
to this
falsehood do not so big-hearted about it that we go
America the opportunity to change
know—much less understand—the broke in the process.
its policy from one of contain¬
true worth of our American
The best method by which the
sys¬
ment, which is negative in charac¬
tem.
'
-v.-.v.', United States can turn this un¬
ter, to one of positive and produc¬
I have said that in the 175
years happy outlook into a happy ad¬
tive action.
since our birth as a Nation we vantage is by making the other
One might even put it this way.
have
produced
more
material countries of the non-Communist
If the quickest way to a man's
things Than has the rest of the world realize that the supply of
heart is through his stomach, it
world in all the centuries of hu¬ raw materials we need
can
be
man
effort during the recorded their contribution to a balanced might equally well be said that
surest
way
to
a
nation's
history of man. But we must al¬ program. Why? Because they will the
ways remember that this material be sending raw materials to us, friendship is through raising its
achievement has its foundations and we will be paying them in standard of living.

ry

with

*n
a
and

man

is the

you

one

tions.

Parsons, Jr.,
President; M.
S.
Parsons,
Vice

freedom—for

kind's

best

and

cause

that

is

man-

only passport to

Presi¬

urer.

Mr. Par¬

sons

was

merly

of Wm. J,

cer

Parsons, Jr.

Co., Inc. He is
director

a

Bingham-Herbrand

tion, The Ferry Cap & Set Screw
~

™

Company,

.

Mortgage

Cleveland

Company, Mutual Drug Company,
Industries, Inc.

September 28th, 1951

•

ASSETS

on

$

Hand

427,675.78

Cash in Transit-Securities Mailed Free to

.

,,

■

in

our

dollars supplied by

enduring moral values.

Now let

us look at the combina¬
tion of forces that has given us
our vast productive
power.
#

American in¬

American business enterprise is

dustry—good working dollars. On
the other hand, we will be getting

equipped to do the major part of
the job, a job that can greatly

the

commodities

crease

American

need

we

production.

our

to

It

in¬

will

industry is based on
therefore be a two-way street on
integration of raw materials,
which we travel together toward
manpower and tools.
They work a
rising standard of living not only
together in a favorable atmosfor ourselves but for the world.
phere of economic, political and
I understand this problem all
social freedom. It is this combina¬
tion of material and moral forces too well, because I come from a
which
has brought about the large family which has suffered
from
a
"dollar
shortage" ever
American Miracle of Production.
since I can remember; and I sup-f
f>r Must
Have Access to Raw
pose no man of my acquaintance

benefit

•

Materials

has

'■

During most of our history we
have been more or less self-con¬

tained, economically speaking. For

would

were

materials in

raw

not

which

self-sufficient,

access

to the

tried

to

have

But

if

I

support them all, I
been

bankrupt long

we

for¬
merly could remain confident of
continued

had

relatives who

more

"economic aid."

needed

thbse

had

ever

we

sources

of

They would still be broke,

ago.

and I would be of no

use

whatever—a fact which

to them

they

rec¬

supply and uninterrupted trans¬
ognized quite as well as I did. So
port to our shores. America's con¬
instead of giving them unlimited
fidence in our continuous
access

of

communication

regions

was

loans and

grants, I helped them to

establish

themselves

in

self-sup¬

comparatively recent times. This
responsibility we must now take
our

own

shoulders.




Due

from

Either we

are

a

to

tell

you

that today they

lot prouder and

a

lot

hap¬

40,116.49

Brokers

Due from Customers

2,161,729.88

Failed

3,325,569.99

Deliver

to

Stocks Borrowed

53,797.00

Tax

38,308.55

Stamps

Notes

Receivable

Due from

40,489.12

6,292.34

Employees

Furniture & Fixtures—Net

TOTAL

(Reserve—$18,975.35)

$8,861,234.64

ASSETS

LIABILITIES AND CAPITAL
Bank Loans

Dividends

457,427.35

75,580.85

Payable

17,498.37

Due to Brokers
Due to Customers

804,817.80

Failed to Receive

2,200,338.13

Stocks Loaned

Accounts

Taxes

6,175.00

Payable

Withheld

10,321.35

Reserve for Taxes

6,317.13

Payable

Reserve for Legal Fees

Preferred

who

wish

their destinies with
of

our

909.79

..;.

7,000.00
200,000.00

Capital Stock—Common

nations

$3,095,000.00

(Collateral Secured)

Short Securities Position

today.

those

62,564.53

.

shaped its course

to

ours.

share

Because

great strength we can make

it possible for them to profit from
the healthy influence of our pros¬

perity.

$ 10,000.00
.......

T.. $500,000.00

Total

Surplus

,

490,000.00

......................

Profit & Loss Account—1951

Subordinated Capital Notes

789,421.25
190,427.62

..

..

500,000.00

Net Worth & Subordinated Capital Notes........
TOTAL LIABILITIES AND CAPITAL,...

1,979,848.87
$8,861,234.64

Our

creditor status today is
impressive than it ever was.
It can only be justified if we in¬
crease the flow of private capital
to foreign lands and at the same
time expand our imports suffi¬
ciently so that foreign nations can
pay the interest and amortization
more

on

I. ARTHUR WARNER & CO.
Incorporated
-

Point
We

IV

therefore,

see

to

it

We

must

make

clear

that

these funds are not another dona¬

pier than they would have been if tion

from

Uncle

Sam,

and

that

Tel: LAfayette

1

"

PHILADELPHIA

BOSTON
89 Devonshire

it

■

Broadway, New York 5, N. Y,

Telephone; WOrth 4-2300

Program Must Work

must,

Investment Securities

Main Office—120

the loans.

to us by the British
porting occupations—and I do not that Point IV works.
Empire and the British fleet until

on

681.42

21,417.36

Prepayments

Reserve for Federal Taxes
so

guaranteed

need

1,331,827.06

Deposits

leaders in the world

us

789,360.76

10/24/51—$858,082.15)

(Mkt. Value

Long Securities Position

This leadership can be a
source of strength—morally, psy¬
chologically and economically—to

to make

as

561,404.36

Return Mail.

Special Investments

to

thej sources of raw materials and
the lines

are

History has

an

,

where the
waging cold war.

many

Russians

Brokers Vs. Payment by

Street

3-3300

of

Corpora-

Statement of Financial Condition

Cash in Banks and

for¬

offi¬

an

Mericka&

.

and Grand

progress.

-

dent;
and : J.
D. Moss, Sec¬
retary - Treas¬

bear the

kear*~y°ur dedication
of hu-

devotion to the

Officers

Edward E.

are

you car¬

you

se-

curities, spe¬
cializing
in
special
situa¬

.

important document that

Commerce

dealers in

as

of these non-industrialized nations
may

.

Co.r Inc., has beCn formed with of-

,.,

,

'

been said

with

CLEVELAND, Ohio—Parsons &
n

also find a better .way of life.-y
Here, in an economic sense; is-1
If unfriendly powers get the upper program
obligation to .our
to build bureaucracies our greatest
hand, the United States will be and spend and spend on uneco¬ neighbors throughout the world;,
and here also is their greatest op¬
denied, the
strategic
materials nomic undertakings, then I am
needed" from abroad. This danger against the method.
portunity to, remain masters in
is an added reason why we must
their own houses.
take every step to help the nations Opposes Government Insurance of
This, then, is my message to you
Investments Abroad
who share our purposes to attain
foreign traders as you set sail on
their goal of increased economic
Another proposal frequently ad¬
your missions to the far off places
health and well-being.
vanced in connection with Point of the world.
Each
of
you
is
This we are doing, and I believe IV relates to government insur¬
an
emissary for our American
it is enlightened self-interest for ance of American investors abroad
way of life,
and each of you
us to continue and to
intensify this against losses due to war or other carries in his pocket a document
effort.,
hazards.
At first blush, this sug¬
from our
Government—your
gestion might appeal, but I do not American passport. But the most
Human

Wealth

kAf|||C (JW|| FlMtl
1 WBBBB* v,ni 1 111,1

of; thej job, nations abroad-M well equipped to do the job—to
especially the less developed ones help the nations who share our
—will often need the technical purposes to increase their producadvice necessary to develop their tiye power. But to,do so, we must
act promptly with courage * and
resources.
end

Foreign Trade and Point IV

1421 Chestnut Street
Tel: LOcust 7-2400

20

The Commercial and Financial Chronicle

(1760)

.

.

Thursday, November 8, 1951

.

Securities Salesman's Corner

amongst
Voice

signed H. R. 5215 and H. R. 5650, the
first and second supplemental appropriation acts
of 1952,
providing additional funds for carrying on

By JOHN BUTTON

activities of the Government.

there are just give him some suggestions he
His attitude
so
many prospects. There are only would, resent them.
a certain percentage of prospects
has been wrong. If he looked at
that Will reply to even the best his sales standing in comparison
In every territory

"These

appropriations were
for essential mobil¬
ization activities and for impor¬
tant programs contributing to
our national security.
I regret,
however, that these bills fall
requested

advertising program. with other men he would' have
that something was
also a top limit to the recognized
accounts which can be opened by holding him back. But he ducked
the truth.
He blamed his leads.
even the most efficient salesman.
planned
There

is

He said his

Fortunately, the men who usually
are the highest
in production in
every sales organization are those
who feel the strongest obligations
—both

themselves

to

firms.

They

his

lead

expensive

and

which

their

of

item

—hoping

overhead

has

firm

placed

have

able

been

been

able

to

justify

and indifference in their

handling

didn't

report of

a

given about 50 leads in which his
firm

had

stantial

invested

fairly

a

some

terested";

"No

"Just wanted
to

to

see

say"; etc.,^tc.

be had located
man's

what

we

has

not .' been

Another salesman

territory.

town

the

was

given the

He went into the

stranger.

a

He

number

same

took

of

about

leads

and

went to work.

He began,to make

his

calls

telephone

ments.

He

the

over

proposition
tant.

He

for

appoint¬
his people

qualified

phone.
by

told

?

He built

his

-up

making it impor¬
his

prospects that
he was on a trip and that he had
valuable information on the secu¬
rities

about -which

quired.
four

The

thev

day'

first

had

he

in¬

made

appointments. By four o'clock

in the afternoon

he

had

his first

opportunity to do business, but his
prospect suggested that he wished
to talk it

over

salesman

knew

with the wife. This

when

pressed

the

he had

that evening at
home.. By ~ eleven

thgt night he.left with the order.
Out of nine telephone calls that
day he had four interviews—one
call back—and

a

same

four

days

thing.

more

He

was

the

Now

<m£

same

Here

identical territory,

same; kind of leads, and yet
did

-mam

business

otheriwentathrough

some
t' •

'•

and

the

motions.

T

many,

\

them.
technique
see

best

and

going

I

much

am

I

when

in

am

gaged

well

as

as

I

I

can.

Continued

not

am

back 50 names marked N.

sales

or

salesman has constantly
been sort of a fault finder. *When

his sales manager would

try and

greatly concerned by this indirect nullifica¬

our

laws which results from the action taken

course,

will do

If

can't

I

least

at

believe

I

best

to operate as.

convincing the President could
real concern

more

do

that, then I

should

other

any

where

kind

be

in

the

man's

a

still counted

own

as

self respect

to

The

Financial

is

Chronicle)

CLEVELAND, Ohio — Howard
E. Snyder- has become associated
with

T.

H.

Jones

& -Co.,

_

Union

V

:

•?

Joins Hirsch Staff

•

r

■

Hirsch. & Co., 25* Broad Street,
New York, City, members of i the
New York .Stock Exchange, an¬
nounce

has

sentative

the

repre¬
firm's- main' 'of¬

fice.

(Special

•

....

to The Financial* Chronicle)

"

Washington,

^c^arf

e.

Bowers/is now connected with
Vance Securities Corp. of "Greens¬
boro, N.C.

strong—strong economically, and
strong in potentiaLmilitary might:
We

'

..{i ;

'

Wire Service

-

To Western "Markets

t'

LOS

ANGELES

•

SPOKANE

•

DENVER

i

in

Recovery Program, Europe
longer on the brink of night¬
marish bankruptcy.
;
1
Of course, as we move forward
on our international road, we must
is

no

rememher

C

.

^

far

can

we

to serious'danger ^frpm fluehCe,. but' the Current demand
from 'inflation," from ham-fora code of'higher moralcottduct
'stringing our *nati<mal ^effort
ambng all government Officials "is

•

we

ESTABLISHED 1915
■

and

other

50 BROADWAY
Tel.j WHitehall 3.JJ70O

"York Stock Exchange
Principal Exchanges

the

economic

and"

socialrcertainly 'warranted; -If
^csan'f
;very; provide moral .leadership, I-don'tstrength?
;
:
think we can provide any other
These are questions on. which'kind.- Not -all our wealth nor Oil
:the American people deserve facts,s ^bur. physieal ^strength will do -any.
yand »free 'and -open' public 'dis-* ?good if wO cannot stahd:as an excussion.
^
• Umple as
well as a deader.
-i
:;Not Jong; ago' a distinguished
statesman-friend fromrsoiith
Resident Pf this area; Dr.' Suhiner- of .the Rio Grande is quoted "as
H. "Slichter, pointed -out that the felling
ex-Ambassador
5pruille
progress

-which

is

our
•

Members New
"

*J"

*->• «*•■■?

NEW YORK 4, N. Y.
Thirty,,. NY

i

-

.

.

•

i.



—

currently

thing—even attempts at black¬
I, for one,-want to take a
nation that ap-«

proaches

with £he threat to tilrri
we refuse to put up
money to raise its domestic
us

Communist if
the

standards of
We

help

living.
learning

also

are

how

to

nations together into
mutual alliance for peace.
With
bring

Eisenhower

Commander,

Supreme

as

army is
gradually being forged for the de¬

European

a

fense of Europe.

Through

'

North

the

'-*■

;

Atlantic

Treaty Organization, we are
building a community of nations
to bridge the Atlantic.
NATO is
an
international
effort
to
give
peace

strength

a

it has never

generation.
The price of aggression is going
up.
I hope we can price it out of
our

.

" ^

x

-

f

then, that the big stick
obliged to carry with us

agree,
are

part armed-might, part
standby-capacity to produce more
armed-might, part military -arid
economic

aid

to

friends and

our

friendly cooperation toward pe&ce
with all the peoples of the world.
But the biggest part—the part
on which success or failure in this
whole business rests—is our

con¬

to make progress
economic health and

tinuing ability
in

own

our

strength.
be

world

^

.

To me, our
and

over

—

'•

ability to stay alive
for good in the
the short or long

force

a

term—depends upon our stubborn
insistence
on
continuing to in¬
crease
the fruits of our freedom
of

opportunity. It depends on our
ability constantly to expand that
very freedom—not in strangling
it -by
restraints, suppression of
enquiry and unnecessary controls.
We
are
strong because We Eire
free—and the way to stay strdpg

.

,

.

.

,

ward

'

are

go

war,

.

,

we

mail.

.

-are

j

J. A. HOGLE »GO.

that

the healthiest 'and strongest figure
on the road.
We can expect any^

•

SALT LAKE CITY

•

help

economies

.

FOR BROKERS AND DEALERS
f

restore

pean

,

Prompt

learning how to

are

other 'nations

r

.

How

"registered

a

in

our

is to stay free.
in taxes to gated and publicly criticized. NevA society moving forward with
support this effort without remov- ertheless, the country should not real faith in the individual" can
ing the progressive incentive out permit outlays on defense, foreign
perform miracles. Tf this faith.is
•of which the whole strength of aid and atomic energy to rise ;to
adopted by mdre and mdre people
America grows?
$65 billion or more, in ;1952-»53 the
World overhand I hope it as;
How much ^government eohtrof without an adequate demonstra¬
if the world continues to 'turn^to
te ver; our (economy
do 'We'■ really tion 'that this peak is really necUs for leadership—and ! hope: it
iieed, and how much cdn-^we af-^essary."
does; it will Dot be primarilyibe- ;
ford
when -*we oknow dhat
our
* 'Quite aside
from the effect of
cause of arguments or propaganda, 4
strength lies
in Treodom from "such a peak^of Oxpendltare-on the
but because Our continuing rebord
control?
"
* " health of lour 'ecohomy, ! think
How can we do What we must 'there % a i by-product "that "is he¬ of performance is a constant living
" uL
^
llo without causing a creeping ;in- ^ginning To' Worry the American example. « •
"i
"
flation that would ?drain*nurveco- people.
;
Summary:
'| "* f •
L
rnomic lifeblood?
"Such huge sums available for
In summary, "t h i s is wbefe I
What really is the margin lof public spending ate -in th'eihseives
stand;
/.
r-if.
r
disaster we face as we-look at allcbrhiptihg. ILmayPe that we earr
,(1) As We enter our new road
of the picoes in the puzzle-and'try; j^verahtirely^elimhiate thte petty
tO rfput, them together? ^How;olo]se pilferingof little men with- big in- of leadership an international] af¬

.

that G. Arthur Behrmann

become

.

-

;

.

.

_

~

Commerce

Pn
Co.

help

into this international world must

10

page

that they are getting only suggested 1952-53 outlays on de;they really-need—and full fense and foreign aid of $65 bilvalue of every penny, r
w
? lion—even with economies in nonAn annual expenditure so huge defense
expenditures —would
as $57 billion has to be considered
mean a cash budget of $85 billion,
along with the whole complicated and perhaps as much as $90 bilpuzzle of which it is just one part. lion.
This is $15 to $20 billion
Here, for example, are some of larger, than the cash budget of the
the other pieces of that puzzle.
current fiscal year.
/ - *
•
Simply in terms of our economic
How Far "Can We Go.
health,
Dr.
Slichter
questions
To
make
it
unprofitable for whether expenditures should 'be
Stalin to start anything, how far permitted to rise to such a peak. •
should
we
go
in
helping our ' >He said this: "Much of the case
friends
to
become
healthy and in support of the requests for
strong—strong not only in mili- large military expenditures intary might be economically?
How volves military secrets that Cannot
much can we wisely spend in this be publicly disclosed and, thereway? ;
v
fore, cannot be properly investi-

"With T. H. Jones & Co.
(Special

from

what

asset."

an

military strength;
friends to : be

our own

must

we

I

know

business

of

aggression too

the market.

Expediency Should Not
Motivate Foreign Policy!

selling business—or for that mat¬
ter

taining

General

our

Political

am

going to find out where -I failed.
don't

world

at

be

G. with

prospects, brother I

real goal is to make any

our

costly to be worthwhile, it seems
clear that, in addition to main-f

we

going to blame my leads, my ter¬
ritory, or my firm. When I send
no

If

attempt

owe

VVith^Vance Securities

first

'.vV-'

*

it to myself
do this job in which I' am en¬

to

it

we

be had he in the past regularly showed
about governmental profligacy!

something to my family who
depend upon me, and more than

Sr
&

am

How much

owe

anything else I

*

poses will go down the drain un¬
less you get back to your old sys¬
tem of integrity of public life." <

known in

to sell.
That
my firm—I also

to

owe

I

activities
our

effectively as possible within the limitations of presently available funds. However, I will continue to
ask Congress for the balanced appropriations which
are
necessary for our national security and wellbeing. There are no bargain basements where we
can
pick up America's security at cut-rate prices."
—President Harry S. Truman.

<

> see

»

•

were
further analysed I
believe that you wpuld find that

the

the

use

there

It Is Attitude That Counts

If

I'll

will

How

try to

pointments,

opened

definitely not prospects.
the

buy.

I can't tell until I

doing the

five ac¬
counts, paved the way for several
more, and eliminated those which
were

will

Some

me.

them

of

these

ef¬

other

and

forts to keep us on your side. The
millions you spend for these pur¬

second look at any

"We, of

Building, members of
the Midwest Stock Exchange.
jHe
mighty, good day's was previously with John P. Witt

wages. -In-addition he had about
40 piore
prospects to call upon. He

spent

Some

*

de¬

to call back

prospect's

,

interest in our prop¬

some

osition.

veloped real interest, and he fol¬
lowed up by
making an appoint¬
ment

did

he

"within my power to make my ap¬

anything but mediocre.
same

But

•

prospect which

production

right". He didn't
following those who

prospects.

in

by the Congress on these :and a number of other
appropriation bills. It avails us little to enact legis¬
lation if its purposes are to be frustrated by lack
of adequate appropriations.
-

My firm has done a job for me.
These are people who have ex¬

had

Needless to say this

"I

to himself, "Here are 50 leads.

say

Out of 50 leads,

one

he rated fair.

not

were

name

for

*

tion of

was

time

waste

in city

name

no

a'ry

the

off

skimmed

He

That

cream.

of money.

in
phone
directory";
"Smart Alec";
"Couldn't locate";
"Too busy, see later"; "Too small";
book,

He went about his

away

afternoon.

sub¬

Here were
of his comments.
"Not in¬
sum

run

S'fi

economy

production
schedules, and all of us will pay for this lack of
foresight through a higher cost of living.

from the job of
making that night call after he
got his first nibble at four in the

I recently saw the
salesman who had been

#
no

cannot maintain

job in the most serious and pains¬
taking manner. He qualified. He

of costly leads.

is

,

tions

President Truman

of

sense

a

*

-

as

America

of

shattered by the most terrible war
in history.
Thanks to the Euro¬

short-changing these programs.
J Without
adequate
appropria¬

cdlls

could

Others

had

man

responsibility.

negligence

-

"There

un¬

derstand how some salesmen have

■

~

would

order

easy

an

The second

to

•

into the trash basket.

go

never

vital activities.

jthe

When

prospect card.

through—the

come

in

their hands.
I

his

quate "funds -for a number of

was

used, or abused. He made h'is

important

an

as

seriously short of providing ade¬

given -50 valuable and ex¬
pensive leads by his'firm be didn'.t'
care
whether or not. they were

following leads that are
given to them, but they also look
each

of

he

entious in

uoon

sort of caustic report on

back

their

and

good.

was no

a man

some

not only consci¬

are

territory

didn't buy he showed
latent resentment by making

When

officials continues,
well forget about the

your

might

you

"I have

dishonesty

"If

that:

Braden

II

■

•

„

...

fairs, -we deserve to -have more
Widespread, more frank and f^De
public -discussion *>f -the' yital
-issues -involved;
Ther American
•people do not want to >be - talked
they want to be
treated like irresponsible children.
down to, nor do

They

deserve

something

than actions based

political .'expediency.
serve
a

to have

a

better

On short-term

Threy

de¬

hand in forming

long-term ^policy

and program

they .'can live with—a policy aiid

•umw

Volume 174

Number 5062

wuKf&Vftwnwi'i

ttta»f*w ktWtJdriiiwyiMhrstimfet

i»i^W<rt^iWMs^w^>^rA^<J»i«wWtt»vwA

The Commercial and Financial Chronicle

...

(1761)
program

befitting

great

a

with a stubborn faith in maximum
freedom of the individual.

(2) I

want

that

road

to

be

Calculated Risks

road

toward peace, and I think the
of
the
world
want
to
travel that road with us.
And I
hot

mean

peace at any

appeasement,

price.

Asserting there

or

•

am enough of a realist to
that world peace will not

come

quickly by

miracle-^

some

I

but

only through strong, patient,
and intelligent deal¬
ing with international problems
through the UN and on our own,
But

I

would

like to

see

country

constantly talking
working toward it.

and

(4)
this

To enable
road

*

with

self-respect;

I

opportunities

they

once were.

tent

this

is

To

true.

peace

for

unprofitable

ex¬

much

amount
of
time to
give to
spiritual side of life.-- Only by
bringing into balance, at this

their

in-

to

workB

hard.

u.t

there

lots of op-

are

still

ing

provided

military
really

of

power

required.

do

an

Claus, but I

is

own

not

international

prove

is

only

enables

and

insurance policy that

an

us

acter

to get on with

our

And

nothing
nothing—should
be
sidetrack

from

us

allowed

And

quick to
posal

like

I'd

seize

see

I

don't

want

American
out

in

do

it, ,for

take

earn

hundred dollars

one

Risk

confusing, dangerous

"One

.strange international world,
let's play our part our
way—the

tive.

ent

//

and

that

our

first call date...

J

alone

D. D. Schubert Joins

scientific

cannot

This

kind

lick

Milwaukee Company

and

advance

bring

us/-courage.
materialism could

of

America

just

it will ulti¬

as

mately lick Russia.'' Young people,
wholly dependent upon technolo¬
gy, find that when the going gets

MILWAUKEE, Wis. — Fred G.
Morton, Vice-President of The
Milwaukee Company, 207 East tough there
lean

of

I

on.

lifetime

Trading

is

nothing

wonder, if

there

during

to
my

haven't gained in the

we

material things of life only to'lose
ground in the realm of the moral

Department,
announces that

and

D.

spiritual.

Thousands

is

died

'

of

inventors

have

poverty

States

?

.

investments -rising,

on

it

of

$15

over

sound: expectation.

sound
be

It

the

October

declared

the

on

associated

.

49,953,000

48,914,000
53,116,000
67,279,000

f,

62,424,000

67,218,000
55,290,000
54,162,000
51,787,000
49,592,000
50,150,000

49,678,000

55,116,000
66,320,000

December

•

Months--

While fire losses
;

not

$688,460,000

are

thus

likely to reach

$667,356,4)00
record, it does

a new

necessarily follow that fire insurance lines will be unprofit¬

able for the year.

new
•

'■

w

Higher :> property

•'»

f

.

values,

and

'■f

-

^additional insurable property

have helped to increase the fire insurance premiums.

premiums

a"

also

losses

expected to show

are

a

and

adjustment

will

expenses

Also, earned

healthy increase and although

a

be

higher, the fire- lines

should still be profitable.

before

Of course, the margins would not be

favorable

will

1950.

-V" C

payments of 1
stock • a
current,:

in

as

1949

and

so

:The pattern of fire losses follows closely the trend of general

business.-This is also true of prices.

Thus as business activity and
$2.25 give the
prices rise, fire losses also increase. Adjustments in rates usually
yield -of almost 5%; At this writ¬
ing a number of leading New York v •lag behind the changes in losses so that margins maybe tempo¬
banks yield 4J/2% and even less. rarily squeezed before relief is granted.
;
National Shawmut of Boston gives
-Recently there has been some indication that the various regu¬
a-return of about 4.41"%,
There
latory commissions are more ready to grant rate adjustments than
are popular bank stocks
in Chi,

stricken, although
with the firm their, ideas may,have been excel¬
in
the
Before an inventor's idea
Trad- lent,
cago, Cleveland4 and other cities ;
can take shape
i n g
and come rolling
Departoff the assembly line in the form which yield less than 4V2%.
ment,
M r.
.To sum up, a satisfactory return "
Schubert of some sort of product, someone
can be obtained on an
unusually
must
be
found
who
has
comes to The
faith
high grade security selling frac- '
Milwaukee enough in the idea, faith enough
tionally close to its eight-year low.
in the inventor
Oompanyfrom
now

;

November
;

earn¬

stock

$498,227,000

*

$548,475,000

Wit*

Twelve

the end of the year.
Annual
dividend

1949

$515,306,000

56,403,000
52,220,000
55,416,000
53,398,000

Nine Months

afe

is

more

woulct

$57,926,000

58,744,000

..

September

-

assumption that $1.25

no

•

reason¬

outstanding

$711,114,000

$58,823,000
58,340,000
72,468,000
61,605,000
58,765,000
57,116.000
52,980,000
49,787,000
45,922,000

62,965,000

Augqst.

30,

ings in the first half of 1951, oper¬
ating profits of $4 on the 2,600,000
now

the

was

-Estimated fire Damage1950

loans and

capital funds and excellent

shares

damage

69,138,000
71,507,000

June

million

damage would, approxi¬
a new high in

the last three months

$68,686,000

April
May

able to anticipate improved earnings for First National of Boston.

In view

result of the

a

;

Govern¬

is

as

.

July

I '

-

With interest rates

In.

at the rate shown in the-

of the last year, the total damage figure
V
' ' >

March

total
resources, had an average
maturity of 3 years, 2 months and
23 days when calculated to the

youths

being trained by schools and
colleges to depend too heavily
upon scieri c e
and technology.
Technical

United

176.7.

-J;r ;

_"V

January
February

On

was

Thus the current level

This would represent

1951
,

valuations.

ahead

run

For purposes of comparing losses in recent months with those
of the two previous
years, we show a tabulation of
yionthly fire
losses as estimated by the National Board of Fire
Underwriters.
.*

issues,- -comprising '26% " Of

ment

'

Moral Values
is

reason

date

same

week

a

J"

*

assessed

$731,000,000 for 1951.

than- equal those
be $720,364,000.

leaders

June

on

166.4,

repairing the damage is greater

previous record in fire
reached in 1948.
Even if losses'in

in that direction.

premises

1951 the index

was

The

carried at 56% of pres-

were

Sept. ,25,
index

same

fire losses.

of

Security I

Bank

1951

are

'■

Donald
Schubert

book

ended

Providing losses continue to increase

it will take all

community

against
gain for

increase in prices during the
pa£t year.

as.parents, and edu¬

move

a

commodity prices is approximately 6.1% higher than
ago.'This is important because with the same
frequency of

year

Like Best

sons

their

risk.

a

commission.,

and

the

we

The

and earned

all

a

grave

Continued from page 2

They are afraid
They prefer the
sure
bet of sixty dollars a week
salary rather than a chance to
to

to

Michigan Street, and in chares

off.

"sure thing."

a

economy —even
an
model.As we move

American way.:

paying

learning. Why? Too many youths
today seem to be interested only

way

into the

of

of education., But the

won't

of free discussion,
freedom of
action, reliance on the
individual, for any controlled or

military

dangers—although
the skill

•

new

have eased in recent

pressures

first nine rrionths of the current
year, total

siege

these

week

fires the cost of

Stalin?

a

a

of wholesale

mate

offset

can

without the advan¬

successes

tages

Whatever happens, I'm for
keeping the road to peace and
open.

before

obviously had what it takes.

their

us

(6)

our

chance

They took the chance

stopping, wasteful mili¬
tary-expenditure.

trade

forefathers

abundance of moral and

fighting

For the

Stalin aren't

as

as

that losses may continue to

are

Although inflationary

August of 1950 the

But greater spiritual devel¬

opment

ago

•

Joe

dangerous

cators. and

thers

for

progress-

years

as

cism.

Some young chaps today inherit
their fathers' businesses. The fa¬

realistic pro¬

any

half

..

Kremlin

to

Our

„

an

cru¬

frustration, materialism, and cyni¬

have to

a

to

open—

bosses.

of

qualities enabled them to make
every risk a calculated risk with

that main job.

with the

fifty,

About

spiritual gumption. These charac¬

(5) I'd like always to keep the
channels of communication

including those

years

What

-

likely to reach

are

pricey are still above a year ago. One indication of the
current price level is the index of wholesale
commodity prices
compiled by the Bureau of Labor Statistics.

the
now

history,-things

The armies of Joe

my

ter

absolutely-

—

men

now.

had

us

main

job
continued
progress
which
will .prove the merit of a
free so¬

ciety.

look

over

year

months

and courage which is will¬
ing to take a calculated risk. —

difference in the char¬

of

greater

gence

experience^ I find there

basic

a

of last year.

risk,

I

-

back

fifty-

am

good investment toward
But ali such effort is to

peace.

the

As

Roger W. Babson

us

w e

current

Current indications

more

spirit and. things material,
can
we
develop in the coming
generations- the kind "of intelli¬

willing -to

take

want

business

me

with

are

for giving
military and economic aid to other
nations to the extent that it can
a

in world

a

the

Board estimates fire losses at
$548,475,000
$515^806,000 in the first three-quarters of last year or
'

of the

p o r tunities

whatever

our

I

-

country to be

my

Santa

cial time

have

now

Week—Insurance Stocks

for

the period of 6.3%.

that

individuals

centive

aggressive

maintaining

hope

with these material comforts

lose

and

spending

any

I

earnings,
some," people

losses

National

food, bettemclething, better "shel¬
ter, better transportation, and bet¬

of

"

for

.

ter- communication.

nation to start another
world war.
That means that I 'am for build¬

and

.

gov¬

jbHNSON

E.

According to the National Board of Fire Underwriters,"esti¬
mated fire damages for the month
of September totaled $53,398,000 an increase of 16.3% over the
$45,922,000 reported for the
similar month of 1950.
For the nine months to
September the

peace..
...
•
"
The age of materialism
ya which
we live has
given the world better

the

H.

record.

what

every one's

whatever money we can afford to
spend to make it dangerous and

This
Fire

prosperity, plus longer periods of

ernment takes
so

By

and

say

certain

a

When

my

confidence
am

today

aren't

to travel down

us

is

one

risks, Mr. Babson lays lack of moral

hear young people

that

determined

too.

still lets of opportunities if

are

willing
spiritual
gumption in present generation to too much dependence
upon
science and technology. Finds
courage of our forefathers
lacking today.
take

to

(3) I
know

Bank and Insurance Stocks

By ROGER W. BABSON

a

people
do

21

nation

.

t

and| in the future

prosperity of his country,*; to be
willing to risk financing the in¬
vention.
The willihgness to take

Chicago where
he has been in
Donald
'

D.

Schubert

vvMp*'t

for

the

1

past

past

two

was

five

the

i

ment

n v e s

t-

a

business
For

years.

calculated risk and make it
pay

off

the

springs from

spiritual foun¬
within the indi¬
a

in the

and

one-half

years

tain

he

of

courage

Trading Department of" vidual.. Courage is one thing of
the Chicago office of
Smith, Bar¬ which our fathers :had an abun¬
ney & Company.
dance and which I find
lacking
■

''

"f-Oj

;:

Fowler & Rosenau

Thomas
N.

P.

Fowler

and

Rosenau, both members

New,. York
form

the

*

in

today

■

-

the

Stock

Exchange, will
Exchange member firm

of Fowler & Rosenau
with offices
at
15
Broad Street, New York

City,( effective Dec. 1.

young

%

men.

Risk and the Future of America

About

Walter
of

most

2,400

years

ago

a

Greek

it

If-

only

bank
have

duplicates

stocks in

what

other

accomplished,

a

pleasant

en-

secret

of

didn't

mention

social security.

ing

his

bank

countrymen

they wanted to

accounts

What he

was

was

assure

or

tell¬

that

Greece

if
of

the need for

the general stock market in

period

a

be

of indecision,

this

or

'

;'■

"

for

leaving

the

another, day.

larger
First

".

s.

:

*

.

.

Fire losses

-

On Nov. 15 the New York Stock

Exchange will consider the trans¬
of the
Exchange membership
of John C.
Duncan, Jr., to Wilton
fer

L. Jaffee.




to

everlasting future they needed
develop

ioned
tude.

some

moral
I

have

and

good cold-fash*-

spiritual

faith fenough

forti¬

future of America to believe that

to. The Financial Chronicle)

,

Head

Office:

Branches

we

are

on

the threshold of

a

new

M.

O'Keefe

In

Cal.

has

—

and

-

-

t

,

a

•?

<

They

cycle.

T

now

have been

'

BANK

and

Aden

Zanzibar

£2,000,000

Capital
Fund-

^._^^_£'2,5d0,600 I

conducts every description of

banking

become
In¬

.

'

and

INSURANCE
STOCKS

Bishopsgate,
E. C.

£4,000,000

The Bank

Jo¬

Consolidated

26,

Subscribed Capital
Reserve

vestments, Inc., Russ Building.

I1

number of

"India, Burma, Ceylon, Kenya

Paid-up

-

with

a

level, the next major move should be down.

Colony, Kerlcho, Kenya,

to The Financial CurQnicle)

FRANCISCO,

are

two years and while they may increase moderately

London,

-

,-v

With Consolidated Inv.

seph

-

through

Kenya Colony and Uganda

*

-

Affiliated

-

-

..Bankers to the Government in

,

PINES, N. C. —
Donald L. Madigan 4s associated
with Reynolds & Co.
c

,

There

have passed their peak and (2),

of INDIA. LIMITED

SOUTHERN

SAN

in the

may

NATIONAL BANK
v

Joins Reynolds & Co.

(Special

over

•

to go

seem

from the current

r

To Be NYSE Member

an

cbmirig months.

*

.

some,

'

;

production is not likely to show much, if any, increase

targets

?

/(Special

"

Nationals

•

\

the

prices

current levels,

rising for

Bank -of Boston is ideal for anyone
who Wishes to embrace that phil¬

osophy.

m

for this—(1)

industrial
from

excellent time to stay close
home • and
hunt
for
smaller

to

turn downward

reasons

an

game,

,:

Another consideration is that-fire losses may-tend to stabilize

-

-

may

fire underwriting do not indicate

immediate action, if they persist it i? likely that

effort may be made to raise rates.

hqneement of capital would result.
With

rapidly changing economic conditions.

While the trends present in

similar situations

statesman,

Pericles^ said, "The
liberty is> courage." He

heretofore because of the

and exchange business

Trusteeships and Executorships
also undertaken

Lairdy Bissell & Meeds
Members New York Stock Exchange
Members

New

York

Curb

Exchange

120 BROADWAY, NEW YORK 5,

N. Y

Telephone: BArciay 7-3500
Bell

Teletype—NY

1-1248-49

(L. A. Glbbs, Manager Trading Dept.)

Specialists in Bank Stocks

22

(1762)

The Commercial and Financial Chronicle

Joins J. Lee Peeler

.

.

Thursday, November 8, 1951

.

Current Mutual Funds Literature

(Special to The Financial Chronicle)

now

N. C.-G. T.
associated with J.

Lee Peeler & Co.,

The

Mutual Funds

WASHINGTON,
Bowers is

Inc. of Durham.

for

By CARTER GRENVILLE BURKE

The

E

;

Court

request

investment dealer,

your

NATIONAL

or

from
from
&

SECURITIES

CORPORATION

RESEARCH

120 BROADWAY, NEW YORK 5, N. Y.

State

If the public has

community
upon

with

also

before

causes

forgotten, then one might ask "Is the financial
forgetting?". Is the event so distant that the

Black

Friday

only

now

are

tenuously

The

connected

In general, it has not slipped the memory of the financial com¬
munity. In fact, mutual funds leaders today are strong proponents
of a conservative and well-grounded approach toward the public's

mm***"
teiv

4SH«m

heading

quick grasp

on

of

sound

practice;

rather

too

a

strong

Are

if not all, who

and

and who believe the

mutual fund idea, per se, to be sound, these

occasional commissions against good practice are

painful to watch.

X PA.

The few dollars

gained today in recent activities by

enterprising individuals

can,

tomorrow for which the

in this light, be

a

Securities.

Group

of

write to Distributors Group, 63 Wall Street,

Howard

&

This pamphlet shouldn't

Stock Fund.

deceptively simple title.

You

Building

a

Complete

Policy?

Investment

In

a

re¬

section, high return bond and preferred section, and common
The purpose of each portfolio "compartment"

Because, in an economy tending toward an egalitarian income
distribution, the investment companies can one day be a trusted
repository of people's savings, a vital pipeline of equity capital and
a strong influence in the demand factor of the stock market.
PHILADELPHIA

Classes

a

building a house—from the investment "blueprint" of the
prospect's objective to the finally architected "investment
structure," ready for all kinds of weather. To complete the
idea, Putnam Fund presents its investment holdings (ready
for all kinds of "investment weather") divided into reserve

with mutual funds

are concerned

Industry

and

is

markably clear analogy, Putnam Fund compares investing to

fortunate opportunities.

To the many,

Funds

booklet

Using'
"question-and-answer" approach, Eaton & Howard clearly"
effectively develops, for the unsophisticated prospect,
the mutual fund idea and the investment objective of the
Fund. Salesmen will find this pamphlet "echoes" their sales
talk after they've closed the door. Available from Eaton &
Howard, 24 Federal Street, Boston 10, Mass.

violation of regulation, but occurrences that would not be classified
the

copies if you write them at 50

a

However, in recent months, the financial elements in our econ¬
have witnessed minor evidences of forgetfulness, nothing in

under

you

and

omy

VJEIUNGTON

send

be underrated because of its

>

(

will

Fund

About Eaton

public interest are suf¬
previous generation are

a

of the Supreme Judicial

Massachusetts.

now, but if not,
New York City.

investment in the capital market.
The selfdiscipline the industry has imposed, the evidence of
its record in cooperating with government, its willingness to work

proof that the experiences of
vividly remembered.

a

professional communication, for dealers
only, explaining the characteristics and objectives of the
Group Securities family. You have probably received one by

with legislatures and commissions for the

■km* ma*

lawyer with

Street, Boston, Mass.

Five

This

the effects after Black Friday?

ficient
fctwMMH *nmm mwnHimmmmimem*******

of

Putnam

,,

Prospectus

or

1830, by Samuel Putnam, Justice

inflation and turmoil, the 1929 debacle is only faintly remem¬
and,, if one peers back at all, it seems a distant, even
remote, event in a nearly buried age.
war,

bered,
-

officer, trustee

12-page booklet contains a brief account of the events
leading up to the opinion now known as the "Prudent Man
Rule," which was rendered over 121 .years ago, in March,

Family Wash—I

the stock market is that, through this last decade's thick mist of

Series

Income

and salesman
subtle reason
the local banker,-trust
copy of this booklet.

salesman's call than to present

a

This

One accepted reason today for the renewed public interest in

NAT 10

Aside from the profes¬

Story of The Prudent Man Rule.

sional interest which every mutual funds dealer
will have in this story, I can think of no more

stock section.

is given.

The

copy

is excellent and the approach simple.

Other literature you can also write for now include,

Your Money

to Make

few
costly proposition
a

"10 Ways

Go Further," illustrating the fact that

family is really a little business and should use business
methods; "What Every Woman Should Know About Her
Husband's Finances" in times of emergency when she must
a

industry will not be grateful.

take over;

income, the importance of in¬
vesting for the long-term, and

The

the

Your

Mass.

likelihood of

fluctuating
income, it isn't likely thatthere will be disappointments.

MUTUAL FUND
RETAILER

Your customer is
be

By BENTON G. CARR

much

for

easier

another

to

order

Facts and Figures From Wellington Fund.

contains

of

ac¬

an

or

them before you ever

your

CALVIN BULLOCK
Established 1894

New York

One Wall Street

story.

tude

of

the

who

tells favor if
you
them about mutual funds.
The

man

man

telling the story
Or it could be

eystone

Custodian Fund;
Participation in

it's

moral

all

this:

No

you

big that

so

can

customers.

■^^;

will show up in your
sults tomorrow.

sales

re¬

Consequently, the
sell

mutual

way you
to today's

funds

going to have two
important effects on your fu¬
ture business.

in

—

a

direct

advertisements

on

1951, also are given

(Series K1-K2)

COMMON STOCKS

1

Program"—For

performance chart. Available from Hare's Ltd.,
Street, New York 6, New York.
covers

little

as

.J

19 Rector

Up," regular letter of Television-Electronics Fund,

"Keeping
-

in its latest issue the rapid expansion of military pro-

duction

in

the

electronics

industry,

a

story

on

industrial

the coming use of two-way television sets for
inter-office business communication, in which you will have
microwave,

to look at your
news

our

ing Daily"
for
and

boss as well as listen to him, and incidental

items in the television and electronics field.
copy

demand in the
the

of the letter was a reprint from "Retail¬

"Guesstimating," in which the outlook

entitled

recent

television industry is reported favorable

sales

slump regarded as seasonal.

You can

presumably have a reprint of this also if you write to Tele¬
vision-Electronics Fund, 135 South LaSalle Street, Chicago
3, 111.

_

Who Owns the "Axe" Funds?

this small four-page folder
tutional

Fifth

No names are given—otherwise

emphasizes ihe prestige or insti¬

background of the 18,000 shareholders of the four
funds in the "Axe" group.
E. W. Axe & Co., 730

Avenue, New York City.
—B. G. Carr

profit-sharing retirement
plans have been prepared for
by Wellington Fund.
advertisements, differ¬
ing primarily in size (either

your use

The

Fundamental Investors, Inc.

two columns wide and

Dne

or

inches

to

PREFERRED STOCKS

Wellington vl.y

in the folder.

Important features of Stock & Bond Group Shares,
portfolio holdings and their diversification and a

deep)* are titled,
on
your repeat sales
'The Talk of The Town."
today's customer.
If you
The copy tells in
have carefully informed him
simple
about the greater capital risk language why the demand for
Continued on page 23
necessary to achieve greater
one—is

(Series B1-B2-B5-B4)

of

mutual

Two

six

The first effect

BONDS

list

Attached to

of

your

customer is

FUNDS

investing their capital

your

have done the job

escape tomorrow
from bad
customer, and selling done today. The basic
he's enthusiastic, his listeners
selling you do now, with to¬
—who are your prospects to¬
day's customers, is an impor¬
morrow—are
going to be im¬ tant investment in your future
pressed. If he's disgruntled, it business.
If

INVESTMENT

The
town's

a

the

on

right.

of your

one

funds

people
opinions on the atti¬ hidden "sales lever" in

could be you.

Certificates of

mutual

basis of your customer's atti¬
are apt to tude. That can be a wonderful

And these
base their

present judge

30,

$100.

as

people learn about mu¬ rect one—will be on your new
tual funds, they are going to
sales to prospects.
Count on
form definite opinions about
the fact that five people will

your

investment dealer

investment of

1420 Walnut Street, Philadelphia, Pa.

For You—A "Millionaire's Investment

As

Prospectus from

Sept,

Fund,'

cumulation program.
The second effect—an indi¬

A Mutual Investment Fund

This revised folder

chart showing the results of an

new

a

$10,000 in Wellington Fund at offering price for the IOV2year period from Jan. 1, 1941 to June 30, 1951. The invest¬
ment diversification and list of investments of the Fund as

going to
approach

or

"Be Smart About Inflation,"—seven ways to pro¬
and, for dealers, too, "How to Money-Train
Wife." Write The Putnam Fund, 50 State Street, Boston,

tect your money;

Manhattan Bond Fund, Inc.

Diversified Investment Fund

(Series S1-S2-S3-S4)

EATON & HOWARD
The Keystone

EATON & HOWARD

BALANCED FUND

Company

STOCK FUND

Diversified Preferred Stock Fund

50 Congress Street, Boston 9, Mass.

Please send

your
ten

me

prospectuses

describing

Organization and the shares of your

Diversified Common Stock Fund

PROSPECTUSES OF THESE TWO INVESTMENT FUNDS MAY
BE

OBTAINED

FROM

YOUR

INVESTMENT

DEALER

OR

Funds.

EATON

& HOWARD

PROSPECTUSES

AVAILABLE

ON

THESE

MUTUAL FUNDS

INCORPORATED

Name

BOSTON
Address

J

48 Wall Street

24 Federal Street

City
J

State




O

17

BOSTON

333

Montgomery Street

Hugh W. Long and Company

New York j

Incorporated.

SAN FRANCISCO
New York

Chicago

Los Angeles

yolume 174

Number 5062

The Commercial and Financial Chronicle

...

(1763)

shares

Cmttwu

The Mutual Fund-A Lusty Infant

plans

growing

are

Employers
let

offered

are

Fund

can

booklets,

and

in

ments

supply
the

be
obtained from W. L. Morgan
& Co., 1420 Walnut Street,
Philadelphia 2, Pa.
may

of

facilities

to

expan¬

produce

new

chemical products, Chemical Fund

reports in its fifty-third quarterly
report that fourteen portfolio
companies have raised, during the
first nine months of 1951, over

$600;GOQ,OOOinnew capital through
the

sale

with

of

securities.

substantial

Together

retained

earn¬

ings, this capital will be used
principally to construct new
plants.
As of Sept. 30, 1951, net assets
of Chemical Fund amounted to

$51,006,432, equivalent to $23.86
share, compared with $45,784,998, .or $21.88 per share on

in

appearance

and

teen

their

Belgium,

England

eigh¬

e

1951.

Bowes, Jr., of PitneyBowes, regaled a U. S. Cham¬
ber of Commerce meeting with
these illuminating definitions:
You have two cows

and give one to your

Fascism:

neighbor.

You have two cows;

the Government takes both and

lets you buy back some of the
milk

(skimmed).

Communism:

v

.

Capitalism:
cows;

bull.

you

with

V

Certain

a

You have two

the Government takes
shoots
one,
milks the

both,
other

two

v*y

Under

Administration:
cows;

—

away.

throws

and

the

milk

Rennet

b 1

Winds"

"Trade

has

been

work?

in

existence

declared

4th

itself
ern

is

atively

The

rel¬

a

Vernon

new

S.

Vivian

this

try

do

for

tell

to

briefly

you

are^ what they
what'they can't

you;

they cost you.
Most investors, as distinguished
from speculators, are reasonable
and realistic in their desires. They
want a fair return on their capital
they would like to see that
capital grow in value over the
years.

beyond reasonable expectation is
likely to have a very satisfactory
investment experience unless he
bases his program on the three
foundation

Those

broad

investment

of

stones

three

stones

continuous

and

in¬

formed

supervision. Let's look at
by one.
Diversification is simply the ap¬
plication to investments of the
them,

one

insurance
the

principle

risk.

insure

just one or a few
few houses. One

or one or a

death

or

fire

one

sufficient

of

capital in

risk
of

mean

a

in¬

no

will

means

one

security

or

He, too, spreads

broad
that damage

by investing in

a

so

substantial effect

no

on

whole.
selection

Imformed

It

almost

de¬

the

means

only

some

must

of

the

things

which

.34*

.13*

.52*

who work at that job full

.07*

.35*

Automobile....

21
08

supervision is also
a
job for those same specialists.
It means, of course, constant

.44

Building...........

.16

.57

Chemical....

.11

-39

......

watchfulness
owned.

Stocks

safely be "put
ten."

Too

pen.

Within

securities

over

and

bonds

away

many

cannot

and forgot¬

things

can

hap¬

Eleetrical Equipment

.21

.81

Food

-08

.27

Industrial Machinery

.17

.59

Investing Company..

.20

.60

Merchandising

15

.51

Mining

12

.37

-19

.58

highly regarded securities,
including even bonds considered
as of the highest grade, have fal¬
len by the wayside and ceased to

04

.13

produce income.

.10

.39

Petroleum.........

Railroad Bond

my

own

span

of

service in the investment business
many

And this watch¬

11

.40

ing job must be done by those
eqipped to watch; those who have

.15

.51

the

Tobacco,

06

.24

Utilities...

09

.33

terpret them.

Steel

-

distributions from net se¬
be paid ds follows: The
General Bond Fund $.01, The Fully Adminis¬
tered Fund $.10.,The Common Stock Fund $.03,
The Low Priced Stock Fund $.10.
.*ln addition, extra

curity

profits

These

will

essential
*A

*

.

'

■




'

talk

and

are

to

figures

constantly

the

things that are
intelligent investing;

by

School

the

400

of

Fund.

No

keep safely

by the

dividends

Fund

one.

the advice

of

research

organi¬
zation which not only makes the

selections but maintains

a

constant

watching service and recommends
sale

the

of

the

and

time

of

some

purchase

goes

these

of

stocks

others,,

and

on

fee

a

to

the

research

is

before

come

oranization

dividends

your

their
bond

from

to

be

dividends

stable

and

the

of

much

less

funds.

Others spread their money

Over

their

shares

than

fluctuates

those

of I stock

bonds, preferred stocks and
stocks.

common

and

price

There, dividend
stability usually fall

somewhere

between

concentrate

bond

funds

Still other funds

preferred

on

stocks,
or
low priced common
stocks, or
stocks selected for growth pros¬
pects, or securities of a particular

industry. All have their places,
depending upon the objectives of
the

are

computed.

particular

investor.

Investment

3%

funds to

^

yields

Mutual

on

high

on

5%.%

slightly

or

of the more
stock

grade

bond

over on

aggressive

funds.

The

com¬

risks

bear

returns.

In addition to dividends from
So, through the Fund, you are
doing your investing as wealthy investment income, Mutual Funds
investors and investing institu¬ at times distribute realized
profits

theirs.

do

spread over
ties

and

selected

Your money is
broad list of securi¬

a

those
and

securities

are

supervised

by pro¬
you
have other
advantages which the direct own¬
fessionals.

And

to

their

this

stockholders.
be done

can

profits

are

should

and

never

considered

as

Of

course,

only when there
such

payments

be confused

with,

part of, regular in¬

They are, in effect, a return
of part of your capital and should
be reinvested if you wish to
all

of

come

100

stocks

not

have.

bookkeep¬
you and your in¬
accounting is simplified.
anything happen to you,

tax

Should
there is

security and not

one

hundred

to

be handled

inheritance

and

does

for estate

taxes.

you

one

Far

more

bequeath

to

your family rather than burden¬
ing your wife or children with a
task for which they are probably
totally untrained.
If

need

you

to

of

come.

your

capital

dispose of part

at

in

additional

work.

value, which
charge.

shares

The

at

is

in

its

in¬

ings
or

shares worth

own

billion

dollars.

from

run

to

so

not

only

hundred

a

half

over

over

Individual

a

which

dollars

million.

individuals

The funds

three
hold¬

buy

And

them-.

I represent

are

owned by schools, colleges, hos¬
pitals, churches, cemeteries, public
libraries, employees profit-shar-'
ing funds and, in fact, almost
every type of institutional inves¬
tor. That is doubtless true of
many
other funds, too, although not of

all,

since

choose

institutions

reasonably

funds.

/

...

Recently
Oil

Co.

naturally

conservative

•

,

the

Socony

established

Vacuum

-

employees
savings plan, under which the em¬
ployees may allocate part of their
salaries
50%.
the

an

(and the company adds
employee may direct

Each

investment

of his

this fund in

one

things

only

and

ment

Bonds,

stock

and

or

interest

three:

Socony

Mutual

qualifications
" V

etc.

During

the

Vacuum,

past

meeting
to

as

two

or

sizet
three

several states have enacted

years

laws

Govern¬
-

Funds

certain

iir

of three

more

specifically including Mutual
shares among the securities
be purchased by trus¬

may

tees and other fiduciaries.

Thus, in their relatively short
to date, Mutual Funds have

career

shown

themselves

vestments
think

of

wide

in¬

modern

I
investor should know

every

acceptance.

about them and should study their

application

his

to

plans

his

for

financial future.

own

N. Y. Securities Dealers
Annual Dinner Nov. 9
The
York

annual

dinner

Securities

of

Dealers

tion will be held

on

the

New

Associa¬

Nov. 9 at the*

Waldorf

the Association.

Principal speaker will be Law¬
C. Marshall, President of thei

rence

Bank

Cost

of the Manhattan Company.
Among the guests who will at¬

tend

are

all five commissioners of

This brings us to the third por¬
tion of our discourse; what Mutual

the Securities and

Funds

Donald,

cost

shares

The

you.

continuously,

through

an

ducts

wholesale

a

funds

sell

usually

underwriter who

con¬

Exchange Com¬
mission, including Harry A. Mc¬
Chairman,
Mr.
Morrist

said.

Other

clude

President

reaching

retail

investment

customer you are.
To cover the expenses

you

house

whose

of

the

expected

T.

the

New

Richard

in¬

McCormick,
York

Curb

M.

Crooks,
Thomson & McKinnon, Chairman
of the

of

guests

Edward

operation, the
through the Exchange,

shares

promptly at the liquidating
value then in effect.
That liqui¬
dating value, in terms of a single

ple

asset

all of your shares at any time,
the Fund
itself will repurchase
or

Fund

fancy, but it is a lusty infant.
Already more than a million peo¬

without sales

means

Lusty Infant

Mutual

Astoria, according to an
keep announcement by David Morris,
Most David Morris &
Co., President of

Mutual Funds give you the option
of taking these profit distributions

a

account;

can

investment

A

The

or

The great bulk of your

er

annually.

which

fairly direct relationship to the

a

tions

value

Funds today vary from
something
under

some

evening newspaper.
Of
the Funds, like every

slightly less than % of 1 % of asset

Fund

Yields

mon

Tagging Along With the Pro's

and

have normal op¬
erating expenses. These are notbut
fixed,
ordinarily represent

interest, they

quite

are

value

pays

charged against the Fund's in¬

ses

derived
tend

in

are

many
invest only in

Some

Since

invest

There

as

of the expen¬

one

other kinds.

bonds.

which

stocks.

conditions

change. The Fund, of course,
and that fee

Funds

and stock funds.

purchased

are

upon

experienced

certificates

have

you

stocks

to

have four.

you

100

taking.

So far, for the sake of simplici¬
ty, I have been talking about
Mutual

does

They are, in
opinion, risks well

humble

my

common

New

Board of

York

Governors of tha

Stock

Exchange, John.
Mann, Chairman of the Board

underwriter and the dealer and to

J.

share, represents the net worth of

compensate

of

the Fund,

Exchange, W. Warren Wil¬
son, Chairman of the National As¬
ing Funds to you
sociation
of
Securities
to select those suited to your
Dealers,
pur¬
pose a sales charge is added to the District 13 Committee, Wallace H.
asset value of the shares. In most Fulton, Executive Director of the
cases
this charge runs between NASD, and O. Glenn Saxon, Pro¬
71/2% and 8%% of the price you fessor of Economics, Yale Univer¬

divided by the number
of shares outstanding.
It may be
more
or
less than your original
cost, depending upon what has
happened to the value of the
Fund's

investments in

the

mean¬

time.

think

brief,

what I have said gives
fair, though necessarily
outline of what a Mutual

Fund

of

I
you

is

a

and

Now

the

what

common

it

stock

type

do

for

you.

what

can

it

can't

consider

do.

If

I

man

pay,

them

who has the

and

you

believe,

as

I do, in the

think

you

industry, then
must agree also that

with reductions

smaller

percentage
bears to

ance

whole. Mutual Fund

pur¬

Governors

of

the

New

York

Curb

sity.

than

total

selling

life insur¬

Helbig Branch Opened
ORLANDO, Fla.—Baron G. Hel¬
big & Co. of New York City have
opened a branch office at 1218
Golfview

Avenue.

premiums.

The

other fixed

agement fee,

cost

the same rate

is

a

man¬

% of 1% a
This is about

G. A.

usually

of asset value.

investment

as a

large

cluded in your life insurance pre¬
miums and, incidentally, it is a

fluctuate

ally and

on

This may be considered as
similar to
the
commissions in¬

good American stocks are desir¬
able things to own.
But stocks

both individu¬

sales¬

chases.

year

in price,

the

job of explain¬
and helping you

expense

let's

future of American

Mr.
Vivian
before
the
Montclair,
Montclair,
N. J., Oct. 30, 1951.
Adult

Si,

facts

of

These 100

before them and know how to in¬

Railroad Equipment.
Railroad Stock

bank

are

equities.

them

time.

Continuous

.63

Aviation.......

to

be considered in

.39*

•

for

instead

And

important,

.28

Industry Classes:

instead

managed

for

.09*

....

agent

as

The

They

ing is done for

securities,
has

one

would

Similarly,

few securities.

the

company-

checks.

term

four

deducting necessary ex¬
the proceeds to you,

deposit and record

spreading

of

insurance

No

.09*

Common Stock.

have

year

a

stockholders, in four quarterly

But

are

and

stocks.

roughly
checks

a

matter how small your holdings
in the Fund may be you have an
interest in all of these 100 stocks.

diversification,, informed

selection

buys

common

collects

a

custo¬

as

it

say

buys

pays

dividend

an

investor who is lucky

an

.07

Low Priced Stock...

pense,

and

Only

us

it

acts

dividend

and after

the

to

which

bank

hundred

approach to
the problem of investment.
As I understand my assignment,
am

capital

of

hundred different

mod¬

and

pool

are

owner¬

which accompany what
"been the substantial
longrewards
of
owning good

Let

fund

General Bond.

...

com¬

at

generally
Those

stocks.

common

they

risks

dian.

mutual

appraising
future prospects for a security.
It is distinctly a job for specialists

..

this

the

worth

Institutional Bond...

Fully Administered..

With

many

bank

So

which the company is engaged are

1951

of

dividends

week,

a

they

can

inseparable from

large

that.

reputation, profit
tax position and the
business
generally
and for the particular business in

Total

Quarter

Funds:

and

money

money

I

fewer

unreduced

downtrend.

a

the

younger

outlook

Reg. (from income)

your

the

investors.

margins,

shareholders of record Nov. 16, 1951.

when

in

are

ship of

takes

to

management

to

time

a

typical Mutual Fund

a

dividends

than

considerably

purchase
of
securities
only after careful
analysis by people trained to
make such analyses. Past record,

been

1951

whole, is going down. Nor

it

other

are

fines itself.

payable Nov. 30,

of Mutual Funds.

use

far

fifty cents

course,
other business,

your shares go up
when the securities
market, as a

American

to

from net investment income have

can

though

make

-

than

make

bined

list

following Fourth Quarter dividends

means

cannot

broad list of securities and depos¬
its them for safekeeping with a

them

the

CONSECUTIVE DIVIDEND

and

mistakes,

less

less than the cost of your morn¬

ing

com¬

are not miracle men and

of

a

72nd

wealth

of

and

recognize
quickly.
But

they

or

Professional

Nevertheless they

will

tle

art

stated previously.

as

management expense is a lit¬

your

vary.
an

than amateurs and will
them much more

years and most

risk his

SECURITIES,INC

investor

will

owns

trained

are

they

hazards

it

adds

only about 25

vestor

GROUP

the things that

are

it

science.

a

make

When you become a stock¬

holder

for

crippling loss.

r

get for him¬

can

How Funds Work

shares,

e

lives,

Cerj's

the

How does

Saturday Review of Literature

The

both

fund,

would

■;y, y.

From

self; and they

redeem-

success.

and buy a

one

'; •, v

Capitalism

takes

have

You

sell

r

two

have

You

cows;
the Government
both and shoots you.

'

.

not

managers

things that only the in¬

are

stocks

maintain

do for you and what

.

.

Fred

Socialism:

they

vestor of wealth

enjoy by the

what mutual funds

.

the

petent people.

American

can

You Have Two Cows

fund,

own $5,000 worth of shares

will

the investor of modest

hundreds,

mutual

a

forms

Scotland well before the end

t h

of

some

pay

of the

and

including employes.

made

trusts

$100,000. You
this fee separately
charged against the income

not

If you

your

Investment management is

are,

I

per

June 30,

investment

the

REFLECTING THE large
sion

While it is true that
of

do

—it is

think

advertise¬

form

mat

with

you

counts of less than

manage¬

risks

eliminate them.
By the
token, dividends paid by a
Fund will vary, because dividends

what they can do for the
investor, what they cannot do, and what they actually cost.
Cites growing and widening use of Funds by institutions and
other groups,

reduce

can

but

on

Authority explains what Funds

plans through a
return coupon, which serves
as
your
lead.
Wellington

Diversifi¬

cannot

book¬

a

such

on

too.

professional

same

Vice-President, Diversified Funds, Inc., and
Manhattan Bond Fund, Inc.

daily.

and

ment

By VERNON S. VIVIAN *

profit-sharing retirement

fluctuate,

cation

23

charged by private

counsel,

counsel does not

but

George

of the New York Stock
away Oct. 30 at
64 after a lone illness.

private passed

like to take

ac¬

Seligmann

A. Seligmann, member

Exchange^
the age of
.

24

(1764)

The Commercial and Financial Chronicle

.

.

Thursday, November 8,. 1951

.

%

Continued from first page

Canadian Securities

Private Enterprise the Key to
More Productivity Abroad

By WILLIAM J. McKAY
In

recent

a

Canadian

address

Exporters

the

to

Fortunately
Canadian

Association

the Dominion Deputy Minister of
Trade drew attention to certain

difficult

19548067

the

few

past

direction

the

of

in

years

for¬

is

somewhat

a

that

anomaly

strange
most

entirely

financial
the

Canada

divorced

British

sells

from

and economic

Whereas

the

Dominion's

it

this

of

problem is not
As previously
as

the senior British Dominion is al¬

Although there have been mis¬
givings in private quarters with
regard to the dramatic change
over

find.

mentioned

disquieting features of the present
Canadian pattern of foreign trade.

solution

a

trade
to

the

system of

Commonwealth.

Australia,

for

the

to

unreservedly

example,

United

eign commerce, this is the first in¬
dication of similar official concern.

sterling, Canada's sales to Britain

Although the Deputy Trade Min¬

are

ister

mediate

Kingdom against inconvertible

reassuring with respect

was

to the immediate

situation, he

pressed the view that Canada

leaning dangerously

basis

the

on

settlement

of

hard

in

im¬
cur¬

This condition of payment
cause of

rency.

ex¬
was

the United

effected

obviously is the principal
the

States market for her exports. He

disturbing decline of Canadian
exports to Britain. Furthermore as

warned that there

the United

to overlook

certain
■

now

was

the hard

flour,
"the

and

tendency

a

fact

commodities

wheat,
goods

on

that

in

such

as

manufactured

United

States

is

not

is it likely to be a satis¬

nor

factory long-term market."
*

to

Although the volume of exports
this country
has more than

doubled in the past five years and

been

has

instrumental

in

those

critical

supplement

and

to

the

the

national

national

defense

welfare,

and

and

farm

products

pays more

and

Britain

be

Statement

its

aspect

every

rightly

fore, that
policy
be

asserts

of leadership the

burden

and

nance

the

to

increase

strength.

of

for essential imports.

conveniently remedied if

inconvertible

38.4%

under

The

view.

There
the

be

must

preservation

terprise.

27.1

ment

a

22.3

28.9

50.2

23.6

26.2

64.8

15.1

In

many

step would entail
sacrifice

The

common

foreign

pursued

by

20.1

s
*
analysis of the 'percentages

lands,

quantities

a

our

is

These

natural

Dominion's
farm

now

S.

normally

for

outlets

products and

U.

the

Europe.

surpluses

goods have
the

of

and

for

of grain,

manufactured

market

which

competitive

in

is

these

items. In addition it has been fre¬

quently demonstrated in the past
that
the
Canadian
economy
is
directly and immediately affected
by developments south of the
border.

In

view

therefore

of

Canadian

vulnerability to U. S.
economic crises, it is clearly un¬
wise
eggs

to

place

in the

perience
that

has

Canadian

y United
of

one

States

too

export

basket. Recent
also

are

ex¬

demonstrated

markets

unpredictable

curbs and the

many

in

the

at

the

mercy

Congressional

action

of

competi¬

decline

of exports

to the

States, Canada would still

During the week there
minimum

of

activity

in

was

the

dealings

fined

ex¬

older issues. Business in both
and unrecorded

of internal bonds

re¬

categories

almost at

was

a

standstill

Canadian dollar

on

the other hand

ing

its strong trend follow¬
temporary weakening

a

caused

by sales in connection with

maturity of the 1%% Domin¬

ion

notes

lower

CANADIAN BONDS

in

of Nov.

1.

Stocks

were

sympathy with the de¬

cline in New York but the West¬
oil and base-metal issues

ern

con¬

tinued to resist the general down¬
ward trend.

Government

eign
the

Federal Reserve Index

Corporation

YORK, N. Y.—At an open
meeting of the New York Area
Chapter of the American Statisti¬
Association, Lorman C. True-

blood
staff

of

and

of

the

will

Arthur

the

Broida, of the

Board

Federal

of

Governors

Reserve

System,

speak

on
"The Federal Re¬
Index of Industrial Produc¬
tion and Its
Impending Revision."

serve

A.E. Ames&Co.

The

meeting will be held Friday,
Nov. 9, at 8 p.m., in the
Remington

incorporated

Two Wall Street
New York 5, N. Y.
worth 4-2400

ny

Rand

Auditorium, at 315 Fourth

Avenue

near

23rd

Street.

Fifty Congress Street
Boston 9, Mass.




(Special to The Financial Chronicle)

has

joined the

staff >of

Mutual Depositor
tional Bank

W. Sittler

Founders

that

The

em- ;

that

this

even

aid

should

«

be extended

can

managerial

immediate

urges

Those

Con¬

The
this

countries

shown reluctance

be

imple- !

sition

to

which

or

have

£
of j

establishment

the

i

open oppo-

political and economic climates j
conducive to the
entrance of :

capital for productive j
should not expect our >•]
help in these other fields..
private

and

purposes

requisite to the
industrial under¬

any

,

be

'

effectively em¬
!
ployed only if they > are linked
; The
with a sense of continuing respon¬
Convention holds it to be
sibility for the productiveness of essential, if our foreign economic
the required investment and forr policy is to serve effectively the \
the earning of a satisfactory re¬ purposes it must, that the tremen¬
turn. The Convention urges, there¬
dous
diplomatic, political
a n d f
fore, that our foreign economic economic facilities at the disposal
policy give practical recognition of the United States Government
to the fact that the provision of be exerted aggressively to the end
can

increase

and

of

be

fully realized and

our

preserved, only if our
Government, in the formulation
and application of its foreign eco¬
nomic policy, puts its chief reli¬
the

upon

public

funds for
expenditure
through political instrumentalities

will

skills

recources,

The

and techniques of private enter¬
prise. The Convention calls, there¬
fore, for a forthright declaration
by the Government that it will

look to private

of

the

national interests
it

will

seek

opportunities
private enterprise

to

of

international

'

in

be

nor

ance

ons

tion

be

that

dollars

transmuted

assur¬

peace
sure

of

urgently
is

threatened.

bulwarkt in

all

ideals.

needed

our

when

It

is

or

peace,

war

other freedoms

It has

won

the

and

the

right to
the devotion and support
of the
American people and of their
government.
n

The

Convention

holds

that

a

tential is the increased production

Corp., First Na¬ abroad, and the continuing avail¬
Building.
ability to American industry, of

goods.

Convention

that

submits

private enterprise cannot play the
essential
part that
it must, in
securing
increased
productivity

abroad,

long

so

environments
inimical
vate

to

the

may

no

which

entry

are

are

of the pri¬

capital

needed.

governments

economic

as

exist

investment

perately

cess

further requisite to the full reali¬
zation of America's economic po¬

into

IV

The

of peace, and to

magically

can

des¬

so

Until

foreign
that

convinced

longer have free

ac¬

to American public funds, we

well

expect

that

they

will

refuse to take the steps necessary
to

attract

private

capital.

This

dilemma, which could be fatal to
the

whole

program

of

-

economic

end,
our

the

Convention

Government exact

urges
a

quid

for all aid which it ex¬
tends to foreign governments, in¬
quo

pro

of con-

course
of our foreign economic
policy to date than the assump¬

of high living standards in

so

this
that

any

responsibility that priownership entails. No
greater fallacy has marked the

all

the pro¬
duction of those military weap¬

sense

substitute for the

be

of our leader¬

ship .in, the directions sought. To

government

there

can

expedited, it is felt, by a

vigorous assertion

make¬

by

be

can

es-

prod¬

hvate

i

private, competitive enterprise
brings forth the initiative and

hlime

for

the common cause.

Progress toward the goal in view

enterprise

provided

"hiring"

effort in

mon

cluding

"tinuing

endeavor.

energies requisite to the

productive

a

account,

end

avail¬

of

shift

require, and
broaden

to

technological capacities

cannot

purposes

the

able

uct

enterprise for the

accomplishment

extend

and

sential to the conduct of a

<

There

decisions

management

giving effect to these intentions.
is urgent need for a com¬

of

bring the desired result.

never

they will

DENVER, Colo.—Paul

public services,

mentation of this concept.

resources

of

taking

objective of our for¬
economic
policy must be

can

1-1043

Joins Founders Mutual

the

gratuitously and i
withoUt-regard for the cooperative i

great and

a

prevails.

'

cal

of

mands
not

be

in the world-wide effort

forth.

success

The American system
of free,

NEW

still

believes

technical

first

fields

To Be Discussed

CANADIAN STOCKS

the

■

maintenance

that

Municipal

•

attitude of the recipient. The Con- *

due part

liberties

our

Provincial

extend

vention

put

America's economic potential. The
Convention holds that this poten¬

ance

the

to

.

The

but the arbitrage rate
tial
slightly to 63/4%-6V4%. The

eased

a

accomplished only if private en¬
terprise is called upon to play its

mostly con¬
purchases of the recent

to

corded

statement:

crisis

the

in

the Convention
major purpose of our
us,

ity in all those countries where

proposals contained in the Coun¬
cil's

continue

bracing broadly such areas as ed- ;
ucation,
health,
sanitation
and
agricultural
techniques;
But
a j'
sound foreign economic policy dej

requirement

This demands

vention

were

issues and liquidation of the

new

of

should

field

the

economic policy must

freedom

a

ternal section of the bond markets
and

fulfillment

tirely consistant that the Govern- j

continuing increase in productiv¬

cherish, the National
Trade Council has set

and

upon

world.

we

mentation

reliance

upbuilding of the strength and
security of the rest of the free

nation and to preserve the in¬

as a

stitutions

in

produce

the

have a natural outlet for her sur¬ Foreign
pluses in the vast market of the forth with clarity and vigor. The
Convention calls for the following
sterling area.
action looking toward the imple¬

resumed

tive pressure groups.

foreign

previously as a conse¬ strengthen our capacity to resist
of the currency barrier. aggression and subversion, from
Moreover, in the event of an eco¬ whatever source they may come.
nomic upset south of the border Such a course, designed to pro¬
that would surely result in a dis¬ mote our security and well-being

astrous

chief

placing

ment

potential

holds that

area

United

factor

to

In

i

full realization of America's

a

economic

quence

the

been replaced by

ling

:

private enterprise for the increase
of productivity abroad, it is en¬

Ill

would regain markets in the ster¬

markets

vital

a

In addition to

ing drop in Canadian exports to
Kingdom

of

limited aid to foreign lands in the j

it to be imperative that the. course
be one which .will support and

traditional

to

the provision
largesse.

for

indiscriminate

raw

and consume.

fields, and the Convention holds confronting

United

the foreign

States will not yield

United

■pressures

in other
availability of

the

capacity

own

would be lifted and the Dominion

the

■

■

governments concerned that the

in¬

upon

-

achievement of the ends in view

Our

become

government

own

our

■is the recognition by

these raw materials in adequate

alarm¬

an

hand-outs

,

The
keynote to the establishment of
the
climates
needed
for
the

the

.

to believe—

reason

they

produced

and

restrictions against Canadian trade

indicated above reveals

has

economy

materials

policy
vital

nation is

,

.

lands

has given them for so long.

dem¬

that

frustration.

creasingly dependent

dedication.

economic

any

and

own

com¬

the part of the

on

tried,

foreign

the governments con¬

do have reason to believe—that they
will continue
to
be the
beneficiaries of the

*

mon

a

been

the

in

as

cerned have
as

concept,
has

condu¬

private capital will be es¬

long

so

distribution,

Experience

has

waste

restitu¬

or

tion of human freedom is

and

American

that

expected

environments

tablished

entry of government into these
operations leads to inefficiency,

hand, as
sterling bloc, Canada would de¬ ternational
economic
relations
rive
certain
advantages.
The can mean success or failure for
present
British
Commonwealth the efforts we make in other

35.6

48.8

ican

onstrated, wherever the experi¬

doubt

no

the

be

cannot

cive to the investment of Amer¬

the functions of private en¬

are

all-embracing foreign
Canada. On the other policy from which it derives. The
a virtual member of the course we follow in our own in¬

of

part

35.8%

sterling.
a

considerable

a

Countries

25.8%

37.3

respects such

Other

It

economic

United States.

Production

goal, and that we are seek¬
ing, in its attainment, a common

;

tarian nature.

directed

ments in the

mainte¬

America's

except those of the
military or humani¬

most exigent

foreign

our

public

no

the United States for

purpose

Convention urges, there¬

The

receive

will

they

called

attitudes

cooperative

funds from

which

economic
aggressively
toward facilitating the contribu¬
United
States
has
been
called
tion which private industry can
upon to assume, in these days of
make in increasing raw material
great and growing emergency, de¬
production in foreign lands, and
mands the formulation
and ad¬
ministration of a foreign policy toward assuring the availability
having its inspiration in the con¬ of these materials in quantities
cept of freedom and dedicated in adequate to our growing require¬
The

that the

effort and

Ministry:

any

or.

policies proposed.

Canada would agree to sell to the

Canadian Exports
U. S.
U. K.

increasing production
can
be discharged

structive

United Kingdom for settlement in

Canadian Trade

for,

fully and effectively only by pri¬
vate industry and private endeav¬

warning expressed by the

for the

industrial progress.

our

the American people and
by their government, of the con¬
ance, by

sufficient basis

provide

countries
and

is

that

This state of affairs could how¬
ever

to

in

effort toward securing the accept¬

one

that, until other
manifest the receptive

immediately

needed

own

urges,
command,
make known

With all the force at its
that the Government

resources

our

The task of

the Council to exert every

urges

materials

raw

sustaining

it

obligation
rests
conditions, it has been obliged upon our government, in the ex¬
in
many
cases
to contract
on ercise of that leadership, to make
uneconomic terms for alternative
clear, to the American people and
supplies. Thus Canada has lost a to the peoples of foreign lands,
natural outlet for her sometimes the course our
foreign policy will
embarrassing surpluses of grain take and the objectives it has in

closing

the U. S. dollar gap the following

statistics

An

forth in this pronouncement to be

Convention

The

policy..

<

Kingdom cannot afford
import from Canada on these

to

expansion abroad, can be resolved
only by forthright and aggressive
action on the part of the United
States Government in the field of
its fundamental foreign economic

!

military

aid.

legitimate- demands in
this regard could well include

j.; The
the"

Opportunity of * access ' to
of needed raw materials;
opportunity, to acquire an
equitable share of the increased
production of both, raw materi¬
als and manufactured goods re¬
sulting from the aid extended;
sources

the'

conclusion
of Treaties of
Friendship, Commerce and Eco¬
the

nomic Development
ward

the

creation

looking to¬
of

political

and economic environments con¬

ducive to the investment of

pri¬

vate

capital; the facilitation of
of multilateral,
nondiscriminatory world trade;

a

wider system

the

establishment

of closer

re¬

gional economic integration; and

'any appropriate and constructive
action in the

face
the

the

military sector.

In

of the great contribution
United States is making to
common

cause,

no

nation/

should be reluctant to accept

the

Volume 174

Number 5062

.

.

.

The Commercial and Financial Chronicle

(1765)
•

obligations essential
mon

to

com¬

a

Continued jrom page 14

effort.

Public

VII

The Convention
emphasizes the
vital need that exists for

throughout the

sanctity

of

ment

world

of

is

contract.

No

aggree-

Pacific Gas & Electric

better than the enforcement it receives.
Our
Government should do whatever
required

to

make

certain

that

ducive to

the

attraction of pri¬

'

security

Convention

well-being,
the

upon

abondon

This is the fifth

acquired

can

task.

bring to the

are

friendly to

the

us can

late in

efforts

make.

It

productivity
private

we

achieve.

own

'

)

the

one year

1928.

1

'Country and
life

best

1,070,000

be

assured.

electric

rates

are

well

on

"average",rather than outstanding shares, to make

v

$9 million

,

i
•

»

•

.

(Special

to

The-Financial Chronicle)

curities

business from
340 Main Street. Mr.

offices

formerly
&

!
•

;

&

"Company,

;

Pont,

Ahmadjian,
du

In electric

Pont,

ever,

at

was

share.

Homsey

.

*.

5% preferred stock

him<
was

is

Azad

formerly

Homsey

&

to 30-33%.
ruiure
future

except that they

borrowing next spring, and

*

Truslow

Hyde

The company

has

at

the

age

.

,

Hyde had been
New York Stock
years.

.

a

member of

on

new

the

^.

|sw

supply

.

Lawrence A.
s\.

.

Wingader,
vnngauu,

ELMIRA,

of

the

^

trading
Nuveen

department
&

Co.,

passed away Oct. 29.

j

on

the

for < Cleveland
for'Cleveland

Chicago,, with
-

new

General Account-

have

we

been

War II.

World

following

He pointed

those circumstances?
a

rise initiate

lar?
J. CI I

»

.

the

That,
jl i.xu vi

a

on

larger

a

vAf

j

Would such

flight from the dolvi

equivalent

scale,

0

of

.

run

a

on

is

y

^

the

hank.
bank,

Now

perhaps

it

reveals

some-

thing basically wrong in my makeUP
I don't relax in child-like
contentment when the Great White

pather soothes his people: "Don't
be

afrajd.

This

Spending)

(fear

deficit

of

is

something that has
been w0rrying you for a number
of years
now.
It's something
you've been saying over and over
again. It wasn't true when you

began to say it, and it has not been
true as you have repeated it over

Cally than it has

ever

been before."

Whatever you may
president's financial
economic
not

think of the
acumen

or

statesmanship, he does
the final appropriation
the tax laws.
Congress

pass

bills-

or

sanction

But it does it with the
under the pressure

or

Under 'our

republican
and

government Senators
to

the

are

bound

to

form of
Reprerespond
them,

put upon

pressures

of

Ask them where they stand on a

had
;

had

a

surplus

.This

billion.

people want this" or "I
getting almost no mail or tele-

am

pie are indifferent." But the lobbies never sleep, the cocktail party
blooms nightly, and all the methods of pressure or intimidation

being plied by those Who have

are

With pride to the fact that during
the last five years the government

•

$8

to grind.
>
When the country tells Washington it really wants inflation

"butterfly

controlled, and Will bear its part

almost

of

Was mot

an axe

^be

*

wvfvvv.

—

*7*1 tbi'llion"' 'wilfbe
111

—.

WC

_

then

process>

'defended.'"
uti-vuvAvvt.

our

dollar

Not before.
• -

—

"

*

'

We hurl his words back in his
teeth when Stalin says an authori¬
tarian economy is more pfoductive than a free enterprise econ-

than $6 ouuon, so mai we CIIUCU
than $6 billion, so that we ended
that year with a deficit of nearly

know

$8.4 billion accrued in the single

-j
"

.

W.

Bennett

has
nas

>»...

become
ueuumc

.

,

affiliated

"ia

-

under such circumstances the national debt would be close to $300
billion. How will bonds sell under

And this was followed
se next year by a jump up of
government spending
by more

,

Rockwell

haps $25 billion the following year,

"grams on that. Apparently the peo-

year

.

Gould

159-167 Lake Street.

anywhere from $10

to $15 billion next June and per-

question and, again and again,
they will say: "My mail indicates

on

or'bank

k, ^

,

^e .deficit at

that the

Which

plant.

N. Y.

fixing

are

deficit of $6 billion next year
if spending is not increased.
Guesses on probable increases put
a

even

sentatives

depends

1948:

J

manager
mauaevi

we

businessmen and citizens,

Since

The

With Kockwell-Gould

jjj.1.

present time?)

that

does this.

ing Office, expressed a very complacent attitude as to the course

financing toward

.

the

at

are

Mr. Truman, in his recent address at the laying of the corner-

per

file applications for accel¬

$90 million of

Lawrence A. Wingader

83.

'




the money

a

_

of

Exchange for 40' John
.

stock

matter

Estimates

ecutive Branch.

(including

expect a v bond issue

How

dealing with this impor¬

the kind of men we
elect to the Congress and the Ex-

passed

Prior to his retirement in
1940 Mr.
,

workers,

-

some common

erated depreciation on about

closing remarks.

icy and

The company has no definite plans at this time for

Iiiiauciijg,
financing,

at-

To this matter,

way we, the people, react to questions of fiscal and monetary pol-

share

28.0%.

against

the

crying over spilt

question is:

be brought about

($25 par), is approximately as follows: bonds

equity

is

™

It

real

hand, it can be forced—by
you and me—to debauch our currency. Which of these results will

management hopes eventually to increase the common stock equity

Com¬

^self.dollar other
The
the

stone of the

stock

nothing

no use

other

if granted, this hew in¬
a

defense

a

year

The

we

tant

Federal

the

a

There is

are

on

there

should have
surplus of from $5 to $10

a

milk.

control

finances

way as to preserve the
soundness of our dollars. On the

about "$20

EPT exemption is about $3.45

preferred stock 22.7%; 'common

the

is

managers,

in such

and in July the company

plant acquisition adjustments and other intangibles)

William T. Hyde
31

totaling

of

me—to control

The Commission has set Nov. 7

•

Oct.

Several

;

-

to

One

crumbles, the whole structure of
business collapses.
The government can be required—by you and

Capitalization, including the recent sale of 1,500,000 shares of

49.3%;

delegated

is subject to severe and unpredictable
fluctuations.
If the dollar

the California

might in theory add about $1.60

It is estimated that the

the end of 1952.

away

a

it Seems doubtful whether 'share earnings would top the $3

level.

be

basis,

»gigantic

our

under

which/and over since then, and now it's
they must do their buying and further from the truth than ever,
selling, their saving and investing 'The country is stronger economi-

system-wide basis, amounting

on a

the latter application,
rates

VV

get
debt

government

billion

for

to

rec-

very

cessful way if the dollar in

6% increase in electric rates, amounting

annum.

I#

cannot
carry out their activities
in the market in a sound and sue-

to the earnings. .Considering higher taxes and other factors, how¬

,

recently conducted his
investment business in Whit-

William

per

efficient when
AlVAf

CillV-Atll

enterprise, there
that simply have
simolv have

farmers, and plain consumers—the
business army of free enterprise—

-

who

insville, Mass.

on

1949-51,

year, was obtained

•

and

own

$37 million

hearing

a

crease

Cannell, French
/
*

Associated..with

pany

•

du

and

COPP,

with

.

with

over

for

WORCESTER, Mass. —Edward
T. O'Malley is
engaging in the seO'Malley

.•

to

O'Malley Opens;
Ahmadjian an Associate

a

during

increase of 18 lk%

an

most

mua t

private

Business

only $2.20*on this basis.

In April, 1950, a

to about

to

direct my

1933-36, the $2 dividend rate had been maintained since

Commission

'

insist that the opera-

we

tack from within.

the

showing; but in the 12 months ended July 31, 1951, the rate

million.

E. T.
,

below

averaging 2.50 cents per kwh., while average
1,941 kwh. is moderately above the U. S. average.

Utilities

and

industry and trade is most

defense

ranged from $2.02 to $2.84 during the period
During the past year or so, the company has reported

Public

Treasury

burdens

•S?'e C+°U^ that I
without. Of rLafTmSt atta+uk

Earnings

asked for

|

to

33,000

base, and the company has had to seek rate increases.

met, and
well-being of our
American way of

our

left

the

on

say

increases in natural gas rates have been granted
by

policy itself will

While

speaks for

proposed, the purposes of

the security and

a

business.

on

flexible cum
and

<600,000

was

of

imposes

serious

mexiuie

These earnings reflect an inadequate rate of return on the rate

for-

inflicts

tion of

33,000

earned

\ eign

and

Government.

235,000

of

with the

force

set-up

substantial costs

Hydro (kva.)

earnings

National

control

price

235,000

1937-50.

better

irresistible

glacier.^ Meanwhile the so-called

average,

the years

but

quiet

disruptions

Steam (kw.)
—

use

parity,

»>rp
twn fitnpfions
are two functions

j

company's residential

cer¬

given ri¬

were

"escalator,
up

the

Despite the rapid increase in revenues—$237 million in 1950
compared with $64 million in 1929—stockholders have obtained
little advantage from this growth. Except for lower rates
during

sustain

our

in

later.

Foreign
Trade Council, that if
foreign
economic policy is directed
boldly
and
aggressively along the lines
,

feet

that

was

and other escape clauses will
per"77 ~
.
mit Prices to move on

J

-

domestic

The task before us
is not easy.
But the Convention
holds, in com¬

with

cubic

while

'

by the end of 1954:

national

free,

•

mon

gidity,

is expected will become available

Total

.

The

it, to which we must look as the
major bulwark of our national
strength.
:f
I

'

Years

enterprise
system
in
the
United States,
given the increased raw mate¬
to

"

1952.

competitive

rial resources
needed

1952, and the balance

for completion

ourselves

our

million

"frozen"

were

tain relationships

hydro plants with a gross nor¬
operating capacity of 1,326,000 kw. and 17 steam plants with
1,723,000 kw.-capacity—64% of which have been installed since
kw.-capacity—647c
wmcn nave oeen mswucu
1947. The following major projects are now under
way or planned

is, however, the

of

400

War II

been

The company now operates 58

mal

na¬

and

the

gree,

about

day, a portion of which it

per

security, abroad
and at home, that our
foreign
economic policy, in all of its as¬
pects, must be dedicated.
The
increased productivity called
for
abroad will
supplement and bol¬
ster, to a highly essential de¬
must.

to

that,

law

sense in which

we

solitary surplus of

They were
through these

World

of

only

compla-

fluke,

a

finance.

years

and

sanction

prices

date

increase

to

public

sound

ary, I said the

one

ommending

ad-

Committee of Congress last Janu¬

to

$8 billion during five years of inflationary postwar boom, let us
put the judgment of those who can
properly be classed as experts in

its

and administrative
authority. Testifying before the Joint Economic

Truman's

through

had shown

making

army,
under the

Mr.

that,

cency

vance

By 1952 approximately one-half of the company's
total gas supply will be out-of-state gas.
Steps have been taken
to augment this
supply with an additional 150 million cubic feet

It is to the end
of procuring this

strength

expected

of

pro-

which

on

proceed."

flationary

gas
to

march

orderly but

more

more irresistible.
Instead of
inflation mob, we have an in-

an

1950

constructed

little

a

also

1954—making

winter of 1951.

and
security in the 'United
States, now and in the
future,
depend upon the levels of pro¬
and

inflation

1 million kw.

some

completed by the end of

claim
for price "controls" than

more

deficit

a

program

basis

sound

a

Against

now

they do is to make the

generating

transmission line, the largest diameter pipe
for the high-pressure transmission of
gas.
Deliveries through this line from Texas and New
Mexico fields now approximate 250 million cubic feet
per day and

that only
a
great and
increasing produc¬
tivity can bring. Our
strength

we

to

natural

are centered in the

duction which

kilowatts

has also been increasing its gas facilities at a
Originally natural gas was obtained within the state

Topock-Milpitas

strength and security

tions

million

gas distributed by the company is natural
the company-began to receive out-of-state >gas
through-El Paso Natural Gas Company. Toward the close of 1950
the company completed and placed in commercial
operation its

line

freedom,

1.4

which the company has
since 1945 the com¬

Thus

budget which premised

of $5.5 billion that
year and a $5.1
billion deficit the next year, add-

vides

words, in this inflation
in, everybody is to be

are

that they will to some extent slow
down the process of inflation. Even
that claim is dubious.
It might
be more correct to say that what

(practically all of the

The defense
of the free world,
and the
hopes of all who cher¬
ish

be

no

company

gas) but in

enlist to the maximum
the facili¬
ties and
capacities that private

enterprise alone

scheduled to

record rate.

It de¬

instead, by
forthright action, to

positive and

is

The

displayed

toward American
industry,
mands
that it
seek

almost

add

we

ston, and Mike DiSalle

total Capacity 2 Vfe times as great as at the end of World War II.

often

-

to

customers.

capacity (including 300,000 added recently) and
more

aloof,

and all - too
attitude it has

new

.

Wilson, Eric John-

a

1949 when expenditures exceeded

consecutive year in

.

ahead of everybody else.
Even Charles

"1951-54 expenditures will average

years

100,000

over

has had

pany

the
Gov¬

the

disinterested,
hostile

19543

$192 million; during "the
about $150 million.

.

ing, "This financial

In other
race

peak

of this program was reached in

to costs.

is—and

industry in the state. Pacific Gas'

billion

VIII

calls

ernment-to

ness."

construction program for the period 1946-54 is
expected to exceed
dollars—a large segment of the industry's total. The

make.

and

set

profits—that the stabilization program certainly has not been developed at the expense of busi-

have afforded great stimulus to

Conscious of the vital part that
private enterprise must
play if our
foreign economic policy is to serve
effectively the ends of our nation¬
al

fact, when the President went
Congress in January, 1950

fairly —at a time when he reported the
The fact* domestic situation
prosperous and
anybody Can verify the the international situation never
facts from the figures on business
more
secure — he
defended
a
in relation

In the past decade California has gained about 52% in
popula¬
tion, and World War II, as well as the present defense program,

foreign govern¬
concerned fulfill the com¬

=

ceilings must be

In

to the

accounting for 69.4%, gas 30.1% and miscellaneous'0.5%.

con¬

capital abroad, but for determined and vigorous action to
ensure that the
ments

—their

Commonwealth Edison), but it has under way the largest construc¬
program of any utility company.
In the 12 months ended
July 31 revenues approximated $260 million, with electric service

vate

mitments they

that their prices canfrozen if their costs
go up

means

be

tion

The need is not
merely for the

"

This
not

of the state—equivalent to the combined areas of New
York, New
Jersey and New England excluding Maine. The company ranks as
the third largest electric utility (after Consolidated Edison and

'

agreements

Company

supplies electricity and natu¬
ral gas to the major part of northern and central
California, with
a
population of nearly .5,000,000. The area comprises about half

other countries live
up to the let¬

of

Right About the
Free Enterprise

Pacific Gas & Electric Company

ter and spirit of their
engagements
•with the United
States or with
any of its citizens.

conclusion

Is Stalin

By OWEN ELY

the

any

is

Utility Securities

recogni¬

tion

n

,

Co.,
.

Inc.,

billion, followed by
wihah

w„-.—

e-a

overdo
was
r

in tispal
umwiiiu^ux

the
ttie

~

a

omy. But he is

V/IIIJ

Crno

JL.«.

—

that

the

market

deficit of free market

19.50. which
,

rine

i

shrewd enough to
whole system
whoip svstem
is

business
,,

the

Of

subma•.

.

monetary

j

unit is

corrupted. Are we smart enough
and nubli<
and public-minded enough to re¬

super-boom year ending
super-doumi
mKn

June 30, 1950 Wofnro iv»P imoact of
before the impact of

Korea was felt.

.

.

store the dollar to soundness?

.

26

The Commercial and Financial Chronicle

<1766)

Continued

jrom

17

page

Thursday, November 8, 1951

.

the power of their local

1

,

;;

Commu¬

nist parties has

steadily declined.
to deny aid to coun¬
tries simply because their people

If

The Mutual

Security Program
And Foreign Trade

Chesapeake & Ohio
The long anticipated
tion of Chesapeake &
dend

Directors

week.

last

came

authorized

liberaliza¬
Ohio's divi¬

distribution of $0.75

a

share payable Dec. 20 to holders
of record Nov. 30. This compares
a

with

quarterly rate of $0,50 a
previously. Historically the
stock had long been a regular $3.00
a

share

with periodic extras in cash
stocks such as Nickel Plate and

payer,
or

Then

Pittston.

in

late

divi-

1949

*

dend

and

payment dates were changed
the first quarterly distribu¬

tion

under the

Since then

missed.

a

was

regular $0.50

main¬

been

has

rate

quarterly

schedule

new

tained.

reports the
recently declared $0.75 was not
designated as a quarterly distribu¬
tion, but merely as a dividend.
Apparently the management did
According to

wish

not

until

commit

to

regularly to

a

is

there

press

themselves

liberal policy
clearer picture of

more
a

the

He said that in
had

road

estimated

was
,

for

the like

still

work

month

1950

to

out

a share, bringing the cumu¬
lative for the year to date to $3.76.

One of the

brightest spots in the
C. & O. picture this year has been
the sharp jump in the movement
of

coal,

export

than

offset

the

which
rather

mestic coal situation.

marks

move

return

a

has

more

spotty do¬

A large por-

portion of this export coal
being handled by the C. &
All
to

available

information

continuation

a

demand

of

O.

points
export

visible

the

over

is

this

future

—it is estimated in many quarters
that export tonnage next year will
establish
the

a new

company

all-time high. Also,

should

benefit

ma¬

It

from

is

the

the

on

anticipated

particular buoyancy on
the
announcement,
appears
to
these "analysts to have a consider¬
able

ior

any

measure

liberal

one

analysts consider the road's
earnings outlook as highly
encouraging and are optimistic as
1952

to the

new

dividend rate.

the

was

Channel", Jr.
With Barcus, Kindred

labor

disturbances

tuminous

coal

in

fields.

or

bi¬

qff amortization of defense proj¬
as

at

is

This

the

same

allowed

accelerated

for

tax

rate

purposes.

question is still pending.

For

the

nine

months

through

September, C. & O. scored

a

rise

•of nearly 16% in gross—the trend
of revenues was still upward in

September despite the letdown in
general business.
Expenses dur¬
ing the period were held pretty
well

under

mounting

control

wages

although
and

the
material

(Special to The:.Financial Chronicle)

CHICAGO, 111. — George S.
Channer, Jr., has become associ¬
ated with
231

Barcus, Kindred & Co.,

South

Channer

La

was

Salle

Street.

Mr.

formerly executive

Vice-President of the Channer Se¬
curities

Company.

v

.....

,

share

measurable year-

William S. Baren With
Baren

Helblg in Florida

earnings at $3.21 were un¬
from the like 1951

interim.
The report for October will not
a

couple of weeks. Last

week, however, Mr. Walter Tuohy,
president, realeased to the press
some

preliminary

New York

City.

estimates

for

Brown

its

its

Brothers

Madden

Harriman

victory.

But if

the

limitations

real

bilities of
that

sure

remains

Times

from

CHICAGO,

assistant

speaker

25 Broad Street

New York 4, N. Y.

Telephone BOwlIng Green 9-6400
Members Nat'l Assn. Securities Dealers, Inc.




capa¬

we can

make

Communist

this

hope

Areas

of Asia and

111.

—

Radiator

at
of

&

man¬

to Hear
Howard

and

of

L.

the

Standard

the

the

regular

luncheon

Investment

An¬

alysts Club of Chicago to be held
today (Nov. 8) at 12:15

Georgian

Room

Scott & Co.

tion

What I have said about the
nomic

limitations

is

course,

of

areas

Asia

resources

of
...

very

it

is

maintaining

achieve

Most

of

these

actually incapable of
modern armies, and

assistance

primarily

at

to

them

is

aimed

helping them
security and

to

internal

countries

to

would

be

com¬

mercy

and

breeding grounds of Com¬
and

eventually make

positive

things

of

After

armies
omies

were

were

the

last

shattered, their econ¬
teetering on the brink

of collapse and their

people

were

During

Carson

at the
Pirie

tremendous

a

they

lack

even

of success,

that

sure

but

continue

will

the

to

increase

As

to

specific
in

security,

think
they

I

lying down

means

in

be

of

with

side

well

as

must

a

real

whether assistance
will

advance

the

question

to

that

is

nation

short-term

and

long-term interests of the Ameri¬
people.

can

We
of

.H

.

trying to

are

the

world

j

the rest

save

because

have

we

learned through bitter experience
that we cannot save ourselves if

ignore the fate of other peo¬
ples. The ancient precept that we
we

should consider the welfare of

our

neighbors has become not only a
matter of morality but a matter of
practical, strategic necessity.
In

recent conference in Wash¬

a

ington,

by
•

the

representative

of

a

national organization declared that
"it's not America's fault that the
standard of living is low in other

parts of the world, and that other

our

if

more

are

we

effective

to

countries are unable to support
adequate armies and navies." This

defense

against Communist imperialism.
fact, many of them have al¬

definite

-what

statement, of
It

they

plans to do
unfair to dis¬
have already

be

would

is

not

question

is

is quite true.

course,

our

fault.

the

But

whether

it

is

real

in

our

interest that other free nations be

strong.

Those

wish

who

to

dis¬

claim all responsibility for what
happens beyond our own shores

done, at a sacrifice much greater
than we ourselves have suffered.
it

its ways of doing

or

The

NATO al¬

truly

laid

directed

The
question is
particular nation is
aid in an abstract

a

of

business.

In

•

fallacy in

criticism

other free nations,

as

still

do

build

other

on

sense, or whether we like
social
customs, its constitu¬

its

Korea.

believe that

We

lies,

in

us

much

economic

and

States.

tional system

their

side

the

of

Soviet

so

moral

Malaya and Indo-China. while
of

the

not

from its determination

as

deserving

have

are

fighting

political

not whether

for

number

with

arisen

its

analysis,

usually ignore the bacic principle

They have doubled their
production.
They have
all lengthened
their periods of
compulsory military training.
They have. increased the total
strength of their organized combat
units by more than 40%.
Mean¬
while, Britain and France are
conducting an expensive bloody
war against Communist guerrillas

also

with

last

behind the entire program—which
is to promote the
security of the

military

are

the

the fundamental

most

of 1950.

troops

its will¬

peace

against the policy of aiding friend¬
ly nations is that these criticisms

increased their defense budgets by
than 75% since the spring

credit

doubt that, given enough

But

the
like

judgment
influenced by
our

impose these systems
peoples.

which they are faced, have

substantial

by

cases

to

by no
the job. Our

on

NATO,

In

respect for its inter¬

In

its

cannot

office

strongly

have

systems

mu¬

we

govern¬

which

from

difficulties

from

more

a

be

Union

will

of

the

fundamental

people.

nation's

our

example,
despite the tight economic squeeze

with

the

of

neighbors.

same

efforts

the field

clear evidence that

partners

and

removed

United

the

other nations
tual

rights,

dictatorial

ingness to live in"

up¬

can

the

in

choice

face

we

national obligations and

peo¬

resist

when

deny

must

proportion.

In a very few years, re¬
markable progress has been made
in overcoming these
difficulties.

despair.

no

as

we

to

world.

moral

which

the

fighting
the ca¬

a

the

this, I believe that

ples everywhere. A people can't
be
expected to commit suicide
when

fuel for

new

difficult

have

will

improve
and have gained new hope for the
future.
The weapons of defense
are
now
becoming available in
increasing quantities. As a result,
<seen

dominate

presented

be

their economic conditions

in the morale of free

to

more

and

.propa¬

charge that America

human

meeting these conditions.
The
people of the free world have seen

have

freedom

ments,

any

free world has made real progress

we

democratic

which

in

surge

our¬

question of giving aid to nations

something to fight with.
the last few years, the

But it is very

foolish of

time, the free peoples of the world
would be able gradually to build
sound political and
military de¬

And

ignore the very great con¬
tribution which their efforts have

on

fense

made to our own

in great excitement and announced

But

through

their

have

we

they will

no

efforts.

own

enough time.
In fact, the very opposite is true.
The coup in
Czechoslovakia, the

foment of

quest of

war in
Greece, the con¬
China, and the invasion

denied to

whose

or

tries

move when¬

the

and

risk

prize looks
small.

seems

American

and

Communism,
to

a

in

this

and

country

Socialistic

policy

our

nations

nomic support.
said
to

that

of

of

and

eco¬

have

no

will

on

defenses.

We

tions asked
can

and

no

lying
the job of building their
urgency

have

are

heard

ques¬

to

why the Ameri¬
people support nations which
as

have forms of government that we
oppose

which

or

heard
save

cries
the

after its

we

world;
own

pursue

disagree.

that

policies
We have

"America

it

can't

should, look

interests."

that

I

would

the

free¬

Denmark,

Belgium,

way,

that

the

Socialistic

are
a

-Prw

the

a

Australia, and

-PvnArl

A*v\

nrl

be

fault that

have

people

a

ant-army

do

not

have

But if that country

absorbed

in

the

in

the

can

world

Soviet

seize any¬
becomes a

for the Russian

war

ma¬

cause

of freedom.

We Americans have always had
keen eye for profitable invest¬

ments.

I

Mutual

or

o

remember

whatever remains! outside
their grasp is a potential asset for

Security Program

sents

in which Socialists
Today, these coun¬
among our firmest allies

n+viirfrflrt

are

chine;

governments
participated.
tries

its

resource

Nor¬

governments

to

our

not

Communists

where

several similar countries have all
had

we

empire, America will have lost
strength and the Soviet Union will
have gained strength.
Whatever

simply fails to un¬
plain facts about

Holland,

Too

what

fail

It is not

enough food.

political life in the world today.
In
recent
years,
Great Britain,
France,

em¬

"mutual."

of

and

country does

economic

preserving civil rights and capable
of being removed from political
life by a vote of the people, and
the
ruthless
tyranny of
Soviet
derstand

Mutual

like to

are receiving in return a
increased opportunity for

survival.

Americans

ly elected Socialistic government,

dictatorship,

The

we

vastly

should

providing

the

of

word

think

world

able to

resist, and that they have

sense

down

no

given
Now, we

a

the

contributing to the security of the
free

be

distinguish between

sinking.

was

speak

the

we

or

We have heard it

allies

our

often

attitudes

the

military

most

Socialistic

I

phasize

philosophy, and I happen to be one
of them. But anyone who is un¬

efforts of other free nations,
of

nation.

that

the

that

ship

Security Program, I

criticism

much

of

should

of

Program is "Mutual"

self-interest.

insist

and

funds

know

dislike
There has been

the

When

example, still
make the mistake of placing So¬
cialism in the same category as

all

Question of Allies' Will to Resist

economic

for

people,

passengers

middle

the

other casually replied: "What do
we care?
We don't own it."

coun¬

differ from our own, I
can
only ask that we be utterly
realistic both about foreign poli¬

the

States.

that

in

One dashes up to the other

systems

American

United

political

of the two

me

ship

a

ocean.

that

demand

American aid be

Some

willing to

remind

safety.

who

those

To

tics

and wherever the

very

to

us

that

assurance

be given

with which
p.m.

to give
determination to

more.

defeatism

A

two

necessary

are

ready

by

least

at

and

overwhelmed

seeks

must have

in

their

war,

that

we

provide the Soviet

repeated

is

de¬
fend themselves. They must have
something to fight for; and they

a

contribution

the defense of the free world.

time.

its

obvious

which

ganda machine with

because "will to resist" is
hard to measure, But I think

sist,

Their

undeveloped and
of living are un¬

low.

are

Europe, of
true of vast

Africa.

and

are

countries

our

on

even more

eco¬

these

to make broad state¬
ments about a nation's will to re¬

pacity to resist grows,

Africa

of

some

easy

chance

and

vice-president

American

meeting

o

easy

the

on

pipe dream.

a

It is

Strength is needed immediately,
only way it can be created
by substantial assistance from

Sanitary Corporation, will be the

X » c

an

keep in mind

we

allies,

our

and

is

promotion of John

Chicago Analysts
Spindler,

at all

stability

present Communism with

these

Selected Situations

economic

and the

ager to a manager.

SECURITIES

demand

Europe, in trying to build up
military strength, will under¬

mine

great

Co., 59 Wall Street, New York
City, private bankers, New York,
the

for measures

vote

selves would not choose, we would
be striking at the very founda¬

criticisms.

Kremlin is

Madden Mgr. for
Brown Bros. Harriman

B.

RAILROAD

to

they exceed their capacities.
The Communists hope that West¬

ever

announce

Specialists in

interest

our

that

ern

consider

to

of Korea all demonstrate that the

'

Actually,

changed

be out for

in

not

I have

and

to-year increase in net.

is

Of all the limitations upon the
capabilities of other free nations,
perhaps the greatest limitation is

'.i-V'-1"-G. S. Channer, Jr.

could
not
be fully
offset. y;,
(Special to The Financial Chronicle)
v
transportation ratio was up
ORLANDO, Fla. — William S.
about a point from the preceding
Baren has become associated with
year
and the
overall operating Baren G.
Helbig & Co. in their
ratio climbed nearly two points.
newly opened Orlando office. Mr.
Even at that it was only the sub¬
Baren formerly conducted his own
stantially heavier income tax bite investment business in Florida
a

can

possibly do in contributing to the
common defense program.
But it

to

costs

that prevented

Euro¬

do everything they

to

peans

the

encourage

substantial

The

"

to

munism,

ly allows the railroads to charge
ects

definitely in the American

nomic
year

not the I.C.C final¬

risen

has

of Communist
military aggression.
With a moderate amount of aid,
we have reason to
hope that they
can
hold out against the danger
of Communist revolution,
grad¬
ually destroy the social and eco¬

earnings should
run
between $4.50 and $5.00 per
share, depending in large measure
whether

prices,

like

people the

pletely at the

it is indicated that

on

It is

interest

political

se¬

the

This

higher

for

about 40%.

these

verely affected by the long series
of

just

increase their economic potential.
Without our assistance, some of

appar¬

very

ing

believably

G. S.

of .the few railroads

company

has

income

their standards

in the country to report higher
earnings this year than in 1950.
Last year's results amounted to
.$4.25 a share, in comparison with
only $1.36 a share realized in 1949

when

real

European

barely returned to the pre-war
level, while the average American
citizen's real income, even allow¬

production.

basis of these factors

return.

Chesapeake & Ohio will
ently be

citizen's

that

of investment appeal

income

Western

average

accel¬

to the traditional $3.00 basis. If so,
the common stock, which did not
show

the

terially through merchandise traf¬
fic

recent

produced which can be converted
into capital investment. Actually

$0.55

erated rate of defense

this

it would

approximately

ing

potentialities in the com¬
Nevertheless, based on
the
company's current earnings
and
its
prospects in a defense
economy, most railroad
analysts
have
expressed confidence that

around

at

$4,250,000.
While this would be
some $500,000 lower than the net

business

year.

record

a

of over $35 million.

gross revenues
Net

were

would

the latest period.
October

we

an

am

convinced

investment

security which

we

in

that

the

repre¬

American

cannot afford

to pass up.
•

First,

it

is

an

investment

in

Volume 174

Number 5062

.

.

.

The Commercial and Financial Chronicle

(1767)
If

peace.

succeed in build¬

we can

Continued

from

ing
sufficient
strength
rapidly
enough to deter the Kremlin from

launching

global war,

a

we may
investment will

12

page

prosper.

is the

in

that

sure

save

its

this

from twenty to

us

fifty times

And it is a pattern for
in which foreign trade will

cost.

peace

This, as you well know,
only hope for a continuing

mind,

peace.

Federal

Next, it is an investment in vic¬
tory if war is forced upon us. It

tional

will

which

represent

military
world.

the

in

power

It will

resources

balance

the

ensure

of

modern

-

the sup¬

us

the

agencies

many

tration,

help keep out of Soviet hands

the human and material

Government

Security

shores, and provide
which

the aggressor.
actual

we

us

launch

can

counter-attacks

against

It will buy us more
than we could

protection

obtain

by spending a far greater
in any other manner.

sum

It

is

investment

an

the

in

hu¬

spirit and in the possibility
of human progress. It is bringing
new hope and new
energy to the
man

backward

of the world and

areas

offering millions of people the op¬
portunity for a life free from
feudalism

and

Communism

alike.

Finally, it is an investment in
democracy itself, which is still—Abraham

as

Lincoln

scribed it—"the

once ;

de¬

.

last, best hope

on

earth."'

have

been

roads

of

calling

the

roads,
well

freight

their

on

Reduction

Co., Inc., is of¬

fering to the holders
mon

per

com¬

stock

$100

its

of

rights to subscribe at
share for 248,805 shares

4.50%

of

stock,
shares

of

stock

2,

1951.

held

of

Morgan

Stanley & Co. and Harriman Rip¬
ley & Co., Inc., and 60 associated
firms

underwrit¬

are

ing the offering and will purchase
the

company any preferred
shares not taken by the exercise
of

rights,

3 p.m.

which

(EST) on

will expire at
Nov. 19, 1951.

The 1951 preferred stock is

con¬

vertible

prior to Dec. 1, 1961, unpreviously
redeemed,
into

"less

stock

common

aversion

initial

an

rate

of

for

each

common

,

at

3.75

con-

shares

share

of

of

pre¬

ferred. v The new preferred stock
Jis redeemable at $103 per share if
'redeemed on
or
before Dec.
1,

1956, and thereafter at $101.50 per

There is provision for an
sinking fund commencing
in 1957, to retire 3% of the shares
.'outstanding on the prior Dec. 31
;share.

annual

i until

the

1962

"1961,
tion

thereafter

and

the

plant

large
quantities of equipment and other

of

essential facilities.

vested

the

by

ductive capital assets.
Whatever
happens to these vast public serv¬

portation essential to the country's
defense
effort
requires the in¬
vestment of large amounts of ad¬
ditional capital on the part of the
railroads.
This capital can come

$100

of

per

the

will

it

share.

in

the

critical

spend

a

approxi-

for

in 1951 and 1952.

capital
It is

now

$10,000,000 calcium

carbide

and
acetylene plant at
City, Ky., in view of the
'expanding demand for acetylene
Calvert

the

chemical

industry.

An¬

other important project is a
liquid

'oxygen plant at Butler, Pa., estimated

cost

to

$6,000,000.

approximately

will

shape the destiny of America
generations to come. Agricul¬
ture, industry, or finance cannot
for

survive

need

for

plant,

and

up

should

as

achievement

the

of

ex¬

be
ob¬

jective set up in the Defense Pro¬
duction Act, and at the

maintain
the

their

financial

time

sound¬

simply not available to

are

railroads

.

same

without

rates and fares.

adequate

One of the main

objectives of the railroads in ask¬

in

socialistic

the

achievement

Act

its

of

citizen

level

large de¬
precisely the

opposite

Several

portant
pose

Departments

Govern¬

And

Commission

the

action

the

of

itself, which has held

railroads

down

to

an

inader

quate rate level designed to pro¬
duce

a fair return
investment, can have
only the effect of preventing the

railroads from

achieving that de¬

all

Ltd., follow¬

Government

to

gold mine

operators to dispose of their prod¬
free

uct in

by the national welfare'and

contemplated in the Defense Pro¬
Act.
I

net sales

$87,577,191 for the nine months
Sept. 30, 1951, and net in¬
for this period of
$5,560,054.

its

announces

entire

Hutton

all

make

so.

As

cles—where
from

an

securities

our

investment and

stand

specula¬

tive standpoint.
I have read re¬
cently a number of reports deal¬

ing with this situation, prepared
by financial institutions and per¬
taining more specifically to the
railroads
too.
to

in

They

the

the
are

future.

East.

not

You

have,
optimistic as

Many of the

road securities for

poses—there are so many others
that appear more favorable.
This
is because of the lack of
earning
power on

a

City, passed

Company,

New

away at the age

of 76.




The situation is

healthy from the standpoint of
borrowing money.
The railroads

Spurge, partner in
&

big investment during
times.

need

their

money—need it to improve
properties and carry on a

being bought for income, with some
switching
being reported, in order to acquire

are

and

certificates

Vies.

Non-Bank Investors Active
A minor

pickup in volume and activity in the longer end of the
Treasury list, due principally to very moderately
expanded pur¬

chases by pension funds and
charitable organizations, as well as
takings by former holders of equities, has tended to
put the higher
income obligations a bit
more
in the limelight.
Volume and
activity has not increased out of proportion to what has been
going on, because ah order market continues to
prevail in nearly
all of these issues.
Nevertheless, the somewhat larger purchases
by non-bank investors of the restricted bonds is not

deci¬

regarded

unfavorable development in
government circles.

an

Uncertainty

.both domestic and

over

foreign affairs is beyond!

^So far, however, this

money has gone largely into the near-term

issues, because it has
concerned

kind

same

been

mainly with
of

coming

liquidity

from

investing continues

to

institutions

but there is evidence appearing that

way,

in

go on

that

were

obligations.

riskless

and

This

a

some

substantial

very

of the funds that

being put into short-term obligations by non-bank
investors,
now
being shifted into the higher income obligations: The

were
are

factor is

not

of

prime consideration with these buyers, but
being kept short for buying opportunities that might

were

in other securities.

Now

it

seems

money which had been invested in
is

though

as

of the

some

Treasury bills and certificates

being used to buy higher yielding government obligations.

questionable

important
uries,

position

of

stock

market

is

responsible

Also the desire

to

More Tax

meet these

.C :-v"

Anticipation Bills in Offing

Financing by the Treasury again

to be in

seems

with indications that it will take the

of

more

This kind of financing

tfie making,

tax

quite likely to be announced in the

are

require-

^•:f

■

anticipation
future.

near

is not going to have too much of

an

short-term market likewise is not likely to be affected
very

permit gold mine operators in
to

the

in

uct

dispose of their prod¬

they

free

market, provided
the
subsidy given

forego
the

under

Gold.

Canadian

Mining
Lake

Kirkland

Emergency

Lake,

Ont.,

that

of

be

seeking

liquidity,

keep

to

in¬

Th
muc

/

the

near-ter

The expected offe]

ing of tax anticipation bills will most likely mature
1952.

This

of the

Treasury for the current fiscal

the free
a

Minister

Finance

obligations.

of

announced

However, according to

will

obligations from losing much of their appeal.

The called 2%%

mar-

state¬
Abott,

it is not expected many Canadian
-;*M fining companies will follow

policy as the Lake Shore
since
only those mines in
the low-cost category, would take
advantage of the free market of¬
same

on

June

1

financing along with the March 15 maturity of ta:
anticipation bills, should just about wrap up the new money need

funded

ment

long-term

of

of the year it would sell its total
on

and

offering, because there will still be plenty of fund

an

around

intermediate

Act

Mines,

Oct. 31, that for the remainder

on

the

Ltd.

Assistance

Shore

by such

an

improve income continues to help the

Treasury obligations that

■J

upon

The

in

for the shift of funds into the longer-term Treas¬

way

movement into the

ments.'

the

to

Canada

as

doubt putting more investment
funds into the government market.

>

result of the recent

a

latest

with

figures,

A short-term

stitutions,
the

certificate.

a

are

year.

due Dec. 15, 1951, it
Commercial

the largest

owners

is.believed, will be

re

banks, according to th<

of the maturing obligation

security should not be distasteful to the deposit in¬
in place of the higher coupon obligation, because

even

liquidity preference is likely to continue strong with these

■»,

fer.
or

These

no

subsidy

mum

cost
an

mines

mine

ounce,

offical

dian)
mine

receive

government aid.

get in

or

high-

is $11

1951

price of about $37
would

ounce,

(Cana¬

give

the

steady price of about $48.

a

Prices

Bombay,

on

free

Kong

and

other

points, though fluctuating sharp¬
ly,

down to

are

fine

ounce

$40

from

a

(U.

S.)

per

high of $55

a

1948

subsidy
to

aid

plan,

started

in

high-cost,. marginal

producers, ends Dec. 31 next. No
decisiori

has

the Canadian

to the economy and defense of the

to

continue

yet

been

taken

by

government whether
it

certain of the restricted

put into mortgages.
to

into

1952.

Whether

posits.

question,

this

because

Switching
to be spotty

and

and not

is

will continue

believed

care

the

to

savings

still beini

accordin:

expand is

banks

open

t

making

are

of this competition.

swapping among
as

are

are,

savings banks keener competition for de
trend

it

preparations to take

issues, because these funds

Saving and loan associations

reports, giving the

important

as

it

non-bank investors
was a

seem

short time ago. There

is, however, more of a tendency now in these exchanges to move
into the 1952 eligible taps

believed in
1962-67

fine ouqce earlier this year.
The

Savings Banks Continue Selling
Savings banks continue to be moderate and spotty sellers o'

markets, in Paris,

Hong

for quite some time to come.

little

which together with the

an

banks

The maxi¬

marginal

a

can

efficient transportation serv¬
ice than ever before—so essential
more

bills

fluence

re¬

investment pur¬

non-eligibles
from

the

sion of the Canadian Government

the

v

The restricted bonds
appear to be getting most of their lim¬
activity from the shortest and the longest maturities in the
group.
It is evident that the 2y4s of 1959-62 and the
2V2s due
1962-67 are
attracting more attention in a not too active market.
This is attributed to the near
eligibility feature. The longest
ited

bills which

world market.

still

are

concerned principally with the nearliquid obligations although there has been a bit more
than
activity among these institutions in the
longer, partially
exempt securities.

production
on

market, despite somewhat enlarged
sector, continues to remain in a

income

the usual

subsidy provided in law of 1948,

not

Warren H. Spurge
H.

this

think

I
am
speaking
largely to
a
banking group. Most of you real¬
ize where we stand in those cir¬

prosperous
'

Warren

Does

don't

Commercial banks

market, by foregoing

for rest of year will be sold

bond

higher

term

appear

ing recent permission by Cana¬

anything but

their

on

of

In Free Gold Market

dian

the

range on not too much volume or
activity. Non-bank
investors, mainly pension funds, according to
advices, have in¬
their purchases of the
longer-term Treasuries slightly.
Scale buying,
however, is still the main interest of these buyers.

risk

Lake Shore Mines,

im¬

actively and vigorously op¬
the rate relief sought by the

railroads.
the

a

of

keystone

Canadian Firm to Sell

purposes,

gree been exerted in

ment

the

and

financing of adequate plant
expansion. But in fact the efforts

direction.

is

freedom,

Governments

on

creased

funds

sound

of government have to

com¬

can

economic

liberty.

reaching a
would permit

which

railroads,

bureaucracy

with

which

to aid the railroads in
rate

the

government

in

restricted

pete in benefits to the individual

ment, which is charged with the
that

for

segments
of our econo¬
and to demonstrate that no

my,

burely, in these circumstances,
it should be the duty of govern¬
of

is

all

railed for by the Defense Produc¬
tion Act.
*

administration

today

and
industry and finance and
others, to coordinate their efforts to
keep enterprise alive and healthy,

ports recommend disposal of rail¬

•

The company reported

•ended

ahead,

years

within the framework of
from earnings — or
from
loans, which require earnings to the enterprise system, if transpor¬
tation is permitted to drift into
carry them and pay them off.
'
government ownership. The great
Earnings adequate
to v enable

only

for

financing will

$31,000,000

constructing

York

country, represent¬
ing one-fifth of the nation's pro¬

ices

The

takings

all

of

Kf*

mately

F.

transportation

Reporter

By JOHN T. CHIPPENDALE, JR.

this

in

improvement to the extent called

'estimates

E.

in

ly needed for the expanded trans¬

duction

come

private and government funds in¬

would permit plant expansion and

price is

; assets

The rail¬

substantial part
$100 billion of

a

than

more

acquisition of these and
other additional facilities so vital¬

sense?

t

industry is

the.

Dec. 31,

on

added to the general funds of
the company and used for general
corporate purposes. The company

of

road

cited,

kinds

<be

;

of

gold production

Proceeds

in

addition

But the

,

•

have

I

cannot survive under the

gree of financial soundness which

outstanding

3%

conditions

we

of

the shares

i

for

and

the

The sinking fund redemp¬

year

•

•

1962

year

are

then

enough

earn

outside

capital.
If we
permitted to do this, and
not, principally because

not

we

put

to

improvement

free enterprise system.

to enable them to provide for the
plant expansion and improvement

common

investment

as

(par $100), at
share for each 11

one

Nov.

record

"from

initiative

ing for the increase proposed in
their recent general rate casei was

series

1951

the rail¬

And

own

the

property—to

are

of

enough

adequate

enough

earn

in response to these calls,
have undertaken to build up their

preferred

cumulative

the rate of

the

up

owners

it into

of

attract

loco¬

on

an

to

build

the

earn

their

pay

of

and

of

earnings

them

to

acquire

to

cars

—

as

ness,

Air

deprive

the public

their investment—to

the rail¬

upon

country

motives, and otherwise

pand; their

Offer Underwritten

itself

in

not

adequate

some

done

§

to

to

return—to

Commission

the railroads to build

Air Reduction Slock

interest

right

is

It

Commerce

the railroad plant.

from

Transport

country.

Administration, and the Interstate

American
bases

Na^

Board,

Adminis¬

Defense

additional

effective

the

the

—

Defense Production

the

of

Resources

port of valuable allies, permit us
to fight as far as possible from

•

Our

Inadequate Rail Rates Endanger
Our Defense Program

be

27

are

approach

some

being bought

the

than

was

the

case

not so long ago. It i,;

quarters that the 2%s of 1959-62 and the 2Vz$ o

eligible

because of the opinion that,

date,

developments could take place in these obligations.
as

as

they

interesting and probably profitable

to what will be done about the restricted issues as

The question
they become

eligible for purchase by the commercial banks, is a topic of con¬
siderable discussion in government

hotter

as

time passes.

circles, and it is likely to wax

28

The Commercial and Financial Chronicle

(1768)

.

.

Thursday, November 8, 1951

,

•*.

Trusts and the Northeast National

both

Bank

in

News About Banks

favor

of

institutions

NEW BRANCHES

business

Bankers

and

of the two

merger

at

held

meetings

effective

come

REVISED

a

on

Nov. 5. The consolidation will be¬

CONSOLIDATIONS

NEW OFFICERS, ETC.

Philadelphia voted

of

the

at

close

of

November 9. On Nov.

on

13, following banking holiday, of
Nov.

CAPITALIZATIONS

12

the

the

of

offices

three

Northeast National will be opened
branches

as

companies operating along
seaboard has
been

truck

the

plan for

clearing

interline

An

eastern

launched

Chase National
The Chase

by the

is stated, assures prompt
payment of split freight charges
when two or more truck
com¬
plan it

panies participated in the delivery
a
freight shipment. On such

named

been

Secre¬

Assistant

an

tary and placed in charge of the
Port
Morris office at 410 East
138th

York.

New

of

Bank

Avenue), has

the Americas (Sixth

well,

Patt¬
Com¬

served Manufacturers Trust

branch

since 1937 at various
offices.

pany

of

Charles J. Stewart, President, of
when
the
freight
charges are collected at the point The New York Trust Company, at
Broadway,
New York
an¬
of delivery, the carrier picking up 100
the freight at the point of origin nounced on Nov. 7 the following
(Cofnpany A) deposits with the promotions and appointments:
fcank a copy of the freight bill James H. M. Ewart, Trust Officer,
was
promoted to Vice-President
showing its share of the freight
in the Personal Trust Division;
charge. The account of Company
Jules R. Fink, Manager, and Eu¬
A at Chase is then credited with
this amount. At the same time the gene T. H. Colvin, Assistant Man¬
were
appointed Assistant
account of the trucking company ager,
Treasurers in the Foreign Divi¬
that
completes delivery of the
sion; Warren W. Swift was ap¬
cargo (Company B), and receives
pointed Assistant Trust Officer
payment for the entire freight
in the Personal Trust Division;
bill, will be charged the amount
£
£
£
:
due Company A. On prepaid ship¬
The
Staten
Island
National
ments, when Company A receives
payment for the entire freight bill Bank & Trust Company of New
at the point of origin, the pro¬ York at Port Richmond, Staten

shipments,

cedure

the

at

The

versed.

that the

will

bank

be

re¬

adds

announcement

plan features sharp

ings in accounting costs and

sav¬

elim¬

inates delay in payment between

The Chase's
fee for this service is 3V2C a ship¬
trucking

companies.

size. The
plan wa& put into operation Nov.
4 with 60 major trucking com¬
panies participating during its ini¬
tial stages and additional carriers
expected to join in as the clearing
ment, Regardless of its

system gathers momentum.
'

\

£

£

v

31, according to
the weekly Bulletin, Nov. 5 issued
by the Office of the Comptroller
of the Currency at Washington,
which adds:

-

under

charter

the

appointed

were

Wiedeman

Assistant

Secre¬

taries of United States Trust Co.

was

effected

title

of

Bank

and

National

Island

&

Trust Company of New York.' The
initial capital stock of the con¬

divided into

Frank

bank

1

is Y $750,000,

15,000 shares of the

value of $50 each. The„ initial

par

$400,000, with initial
of New York, according to an¬ Undivided profits of not less than
nouncement by Benjamin Strong, $1,200,000. -Certificate was'llso is¬
President.
These officers will sued Oct. 31; authorizing the con¬
continue with their duties

as

here¬

£

£

£

.

■;

organization

of

staff

members of Guaranty Trust Com¬

of

pany
j

¥

served

the

York

bank

who

for

25

have

or

more

held its annual reunion din¬

years,
ner

New

Nov.

on

2

the

at

Waldorf-

Astoria, with 700 attending.
club has
and

inducted

includes

in

The

.

1,216 members
its

roster

more

than one-fifth of the bank's active

astaff,
and

solidated -bank

as well as
191 pensioners,
chapters in London, Paris and

William J. Neil presided
at the dinner and was succeeded
Club

Olsen.

President

Henry W.
Hamilton C. Hoyt spoke

for the 77

during

by

new

1951.

members inducted

Senior

the bank who

are

officials

of

members of the

for

of

New

-John W.

Davis, Charles E. Dunlap,
F. Kelley, William C.
George E. Roosevelt and

the

Staten

Island.

at

Main

179

Staten

Island,

St.,

York, N. Y., and at 139 New Dorp
Lane, New Dorp, Staten Island,
New York, N. Y. The consolidated
bank will also continue to operate
the following branch of the Staten
Island

National

Company

of

Bank

New

Trust

&

York:

28

Bay

Street, St. George, Staten Island,
New York, N. Y."
£

V

£

to

the
^

Levitt

Queens Committee

of

the

Mr. Levitt is President of
& Sons, Inc., real estate

construction company.
active in civic and

He is also

philanthropic

organizations.

Bank

£

£

of Manufacturers

Trust

Company

of New York, announces
that Mi¬

chael

P. Pattwell, of the bank's
Greenwich office at 378 Avenue of




j -i-

■>

Pennsylvania

Company,

electric

1944,

appointed

was

Chief of the Public Utilities

tion,

Supreme

ters

the

of

The

quar¬

Hammondsport bank.
£

£

Federal

£

the

total

The

of

assets

Pennsyl¬
vania
Company to more than
$700,000,000.
Northeast
National
first

was

1928. It

Bank

Boston announced

on

the

Hospital

Rhode

Island

Nov.

1

of

that

Trust

Company of Providence, R. I. has
its

of

one

members,

the

bank thus

they
the

Reserve

System

as

be required in serving

may

of

needs

its

customers.

The

Rhode Island Hospital Trust Com¬
pany,

the

since the consolidation with

Rhode

tional

Island

Bank,

has

Hospital
total

Na¬

deposits

announced

Nov. 5

on

Operations.

In January, 1945, he
promoted to Colonel and after

is trustee of the Wisconsin Central

Railway and

dissolution of SHAEF became

western Fire & Marine Insurance

the

Chief

its original objective of providing
service to individuals

financial

and businesses in the community,
and that all of its officers and em¬

ployees will be continued in their
present duties after the merger

£

William

ident

Philadelphia,

of

Public Utilities Section,
Military Government for
Germany.
As a member of Gen¬

eral Eisenhower's

sponsible,

it

planning

is

and

rehabilitation

was

Island
voted

Sept. 25, incident to the trans¬
of

the

Rhode

its

assets

and

Island

business

to

Hospital Trust

co.
£

Stockholders

£

an¬

of

The

Pennsyl¬

vania Company for Banking

and

«n«(mwwk.im»

.

director of North¬

a

Milling Co.

Savings Bank

of

Minne¬

1936

of

to

He

American

1947

President

as

National

Bank

of

of

the

Great

Falls, First Bank Stock Corpora¬

was

largest affiliate outside the

Twin Cities.

Bronze

American

In 1944, he became a

director of First Bank Stock Cor¬

Legion of
Merit, the French Croix de Guerre

poration.

with Palm,

In

1947,

Order

Empire,
of

November,
duties

Power

Edison

Netherlands

de

1945,

turned from
the

the

Orange Nassau and the
I'Ordre

Leopold.

the

re¬

and assumed

First

he came to
Vice-President of

Cisler

*

*

the

'

.

elected

was

Board

of

Co., Minneapolis,
Chairman
of
the

Directors

of

First

Na¬

He

on

will also

Jr., President of the
Company, as

eola,

on

executive committee.

the bank's

Announce¬

£

;;v

£

<

Texas,

has

been increased,
$75,000 to $100,000; of the addition, $12,500 repre¬
sented a stock dividend, while the
further increase of $12,500 resulted
as

of Oct. 1, from

from the sale of

new

stock.

,

.

With Standard Inv. Co.
(Special to The Financial Chronicle)

LOS

the bank's board.

serve

of

The First National Bank of Mill*

t

Edgar F. Zelle, Chairman of the
Board and Treasurer of Jefferson
Transportation

*

,

.

President

Corporation and, in

Stock Corporation.

Detroit

-

£

named

was

1949, President of First Bank

Engineer

J

>'r

operating affiliate,
Corporation. A year

Service

of

Company.

First Service
he

Chief

Plants

corporation's

In

later

Mr.

overseas

of

as

that corporation and as Executive

E.

ANGELES,

Lewis

has

joined

Calif.—Harry
the staff

of

Standard Investment Co. of Cali¬

ment of the

elections emphasized

fornia, 210 West Seventh Street.
He was previously with Marache,

that Guy W.

LaLone, Senior Vice-

Sims & Co.

Turner Construction
a

director of the trust company to

fill

the

Turner,
N.

Y.,

native

a

College
he

which
Turner

Continued, from jirst page

Mr.

Brooklyn,

As

graduated from Swarth-

was

more

of

the

by

created

vacancy

death of Charles F. Jenkins.

in

1923,
the

entered

in

of

employ of

Construction

serving

Company.

or

with international rela¬

various capaci¬

change

their mind with each shift of the wind!

charge of the Philadelphia of¬
in

with

Mr.

1938,,

in

and

1947

Independence Demanded

was

Now the truth of the matter is that the former sub¬

company

headquarters in New York.
Turner

has

served

committee

Pres¬

as

and is

Contractors

currently

Executive

a

management must be free
bondage to the financial position of the Federal
Government. It went so far, in fact, as to
say that addi¬
tional interest costs on the public debt would be less ex¬
pensive to the nation than a crippling of the Federal
Reserve System. One could wish that the so-called
Doug¬
las subcommittee had gone a good deal further at various
points and faced up to a number of issues in a much more

member of the

Committee, Director

and Chairman of the

Building Di¬

vision of the National Association.
He is

past director of the Phila¬

a

delphia
is

and

the

Chamber

presently

of

Commerce

the board of

on

Liberty Mutual Insurance Co.
£

direct and

£

community
gratitude.

Joseph M. Dodge, President of
The

Detroit

Bank

of

Directors

the

Detroit,

But

.

Patman.

Mr.

Cisler is Executive Vice-President
of

The

Detroit
Dec.

on

Edison

Company,

will become

1

ident and General

Pres¬

Manager of that

Mr. Cisler, who was
Marietta, Ohio, was grad¬
uated from Cornell University in
1922 with a degree in Mechanical
Engineering.
He was employed
company.

born in

in 1922

by Public Service Electric

& Gas

Co., New Jersey, as a cadet
engineer and gradually advanced
to general superintendent of gener¬
ation

In

assistant

and

of

ager

the

1941,

company

man¬

electric

he
to

general

was

the

department.
loaned by the

War

the

was

then

preparedness

employed

Edison

Co.

of-absence

and
to

by

The

granted

serve

in

sioned

a

this whole
It has

Change in Conditions

Production

But what is

pro¬

Detroit
a

the

leaveU.

Lieutenant-Colonel

S.

and

ordered to the Mediterranean The- *

more

that indications of

In October, 1943,*Mr. Cisler

gram.

understanding fashion, but for this much the
owes the Senator and his associates a debt of

idea is anathema to Representative
always been anathema to him, and if some
of his underlying assumptions are
granted—e. g., that the
Federal Government is and must be held
strictly respon¬
sible for the elimination of depressions—it is not difficult
to make out a superficially plausible case for
political
control of the central banking mechanism. For our
part,
we do not
grant any such premise, ajid with equal vigor
object to the further enslavement of the Federal Reserve
to the politicians in Washington.
At the same time, it
must not be overlooked that the Employment Act of 1946
and the general philosophy which it represents now have
a
very large following in this country, so large indeed
that few have the hardihood to take exception.

the Board

bank.

chairmanship of Senator Douglas,
did definitely take

from

America

of

the

under

whatever else may be said of its report,
the position that central bank

Philadelphia and New
chapters of the Associated

General

■+***

general business conditions

tions—or else that careful students of these matters

elected Vice-President

was

We

following

Army at the request of the Secre¬
tary of War.
He was ,commis-*

£

chanics

tion's

requirements.

the

addition

A long-time resident of
staff, he was re¬ apolis.
stated, for the Montana, Mr. Jenkins served from

civilian

Star,

In

trustee of Farmers and Me¬

a

First

the

1947.

Co. and Russell Miller

power,
gas
and
water
service for military and essential
awarded

since

being active in civic affairs, he

and

electric

Nov. 5 the election of

on

for

Rhode

poration

of

membership

Mitchell, Pres¬
Provident Trust

The

Company

£

K.

R.

of

nounced

£

liquidation

the

director of First Bank Stock Cor¬

Office of

Board, Office of War Utilities, to
assist in mobilizing electric power

of

a

was

change in

no

which place it within the first 100
of the nation's 15,000 banks.
The

Hospital National Bank

of

and

to

opened for business in of

was

that there would be

and

Reserve

director
1937

Vice-President and director of the

of

by the latter in the former

a

since

Belgian

of

established

been

sulting from the merger will bring

N.

was

has

National

British

Cisler to

branch

Zelle

First

Minneapolis

of Walker L.

a

Mr.

Sec¬

Headquarters,
Allied
Expeditionary
Forces
(SHAEF), European Theatre of

Mich., has announced the election

Y.,

Quay,
President, who died in September.

facilities.

power

he

bank, will con¬
being to carry

the time

the duties of Arthur H.

on

opera¬

the

of

for

the French Legion of
Honor, the English Order of the

Fulton

Y., by the Lincoln
Rochester Trust Co., of Rochester,

£

Flanigan, President

the

*

of Hammondsport, at Ham-

fer

C.

60,000

of

Early in

*

mondsport, N.

on

Horace

to

tion

President
tinue

concern¬

Kurtz, "the ac¬
quisition of the current $20,000,000
in assets of Northeast National re¬

Following the absorption of the

Federal

bank.

its

that

so

According to the President

£

having direct access to
facilities, resources, etc., of

York, has announced the
appointment of William J. Levitt

stock.

shares
share¬

6,000

* entitled

are

William

York

New

the

of New

has

The

to survey and

recommendations

ing the rehabilitation and

ident of the

the

J. Stewart Baker, Chairman of
the Bank of Manhattan
Company

of

Company's

now

outstanding,
shares.

shares

10

Pennsylvania

holders

National

Northeast

elected President of the

Potter,
Eugene W. Stetson, all directors.
£

receive

in

become

£

share of

fice

Cornelius

£

merger

shall

ties, he

continue * the

to

York,

Tottenville,

club include J. Luther

Cleveland,
Chairman of the board; William
L. Kleitz, President, and George
G. Allen,
W. P a 1 e n Conway,

The terms of the
agreement provide that

each

After

National Bank & Trust Company

Brussels.

as

is

authorized

•

Guaranty Quarter Century Club,
honorary

surplus

: operation of branches previously

tofore.;:■ He"

metro¬

the

area.

H. C. Turner,

-

,

"The consolidation

F.

J.

in

offices

23

politan

of

addition,
Company will

their

With

Pennsylvania

have

of Business Oct.

solidated

and

The

solidated, effective as of the close

Robert
Calder, Eustace B.
Chapman, Richard L. Faust, Henry
Heil

ganization.

make

tional Bank of Minneapolis when
Island, New York, with common
becomes
effective.
The
merger directors of the bank met
stock of $500,000, and the West
Nov. 1.
New Brighton Bank of West New plans were referred to* in these At the same meeting, Ellwood O.
columns Aug.
9, page 518 and Jenkins; President of First
Bank
Brighton, New York, with com¬
Stock Corporation, was elected to
mon
stock of $100,000 were con¬ Aug. 30, page 780.

'Staten

.

Company's city-wide banking or¬

Northeast

£

£

*

has

Yonkers,

of

native

a

Mr.

Bronx.

Street,

The Pennsylvania

in

of Operations

atre

J

ominous at the moment is the fact

early runaway inflation have largely
vanished, to be replaced by what appears to be a possibil¬
ity—we are not prepared to say whether it is more than
that—of a recession large enough to cause embarrassment
to politicians who must seek reelection next year. It is one
thing to insist that the Federal Reserve be left with power
to check inflation when prices are bounding upward, and
everywhere there is expectation of a continued seller's
an

if

(Volume 174

Number 5062

.

.

.

The Commercial and Financial Chronicle

(1769)

market; it is quite another to give vigorous support to
such ideas of independence for the Federal Reserve when
there

Continued

from first

page

taining

considerable uncertainty in the minds of the
public about the future. There are some disturbing rumors

alleged progress the Patman element
making in preaching the doctrine of political servitude

for the Federal Reserve.

Now, of

investor

it is obviously true that the Reserve
been free of a very considerable degree

course,

System has never
of Treasury domination.

it

I

War

At

its

very

business.

But he would be

was
a

accomplish, build, or pro¬
something
of
recognized

for

of

earnings

is

the

left promptly vanished.

whether

investor be

capitalist

who

executive

defeatist

known

large

a

or

an

corporation

profitable

and

the

risks; and the greater the
op¬

be made part

subject, which

of the record.

we

of

none

But

to

real¬

is going to invest

us

tell

be

let's

because

penny

that

us

practical; and
invest

to

those of
we

our

Question No.

on

of bank examiners could be used

ideological OPINIONS

single investment of

tainly taking

over

a

as

a

to

not

are

going

savings,

own

or

stockholders to whom

share

in

because

we

national

the

government officials who

our

appropriate
should
be

phrase 'Central Bank'
ception

was.

12

was

practically

not used, and the whole

independent banks

tied

gether through the creation of the Federal Reserve
This

original plot

then

con¬

to¬

Board.

conception of States' rights.
"I cannot

was

believe

the Federal Reserve

much

that

the

held

Bank

intent of the

idea

by having
an




was

12 separate

allocated

copy

creators

of

the European

disliking monopoly.

it, the whole original intent

directors from

keeping with the

As I

to avoid the Central

institutions

territory."

■

choosing

funds;

that

the

strict

to

and we
recipients

standards

of

performance.

in

in

critical

areas, who were unable to obtain
their requirements
from

private"

banking institutions. On the other
hand, some loans have been made*
under political
pressure that have
to strengthen the

tended

sion that
with

deprive

investors

nation of

a

Government
vast

impres¬
dealing

bad record in

a

private

need

not

to U. Su

access

funds.

potential

Moreover, a
to private-

menace

investors beyond anything
yet ex¬

perienced, is inherent
program

for

in the huge
getting under way

now

furnishing military and

nomic

aid

to

governments

eco¬

of

all

shades

of political and economic
belief who may be useful in build¬

drawing

distinction between

clear

a 7

gifts and

our

people

is

belief

in

or from inter-governmental
agencies, without taking the stern
measures
of
self-discipline
re¬

quired to create

those

.efforts

our

who cannot

per¬

educate

to

distinguish the

favorable

a

Actually, there

are

so-called

their

not convinced

are

for

need

there

and

few of

very

underdeveloped
outside

is

a

assist¬

growing

un¬

derstanding of the nature of the
reforms

that

are

pre¬

inflow of private
funds from abroad. True, we have
had

an

recent

some

and conspicuous

one from the other, we will con¬
examples of governments guilty
tinue to keep them well sorted in of flagrant violations of foreign

minds.

our own

property rights and of agreements
entered into by private investors

Furthermore,

Criticised

have

we

in
every

right and duty to insist that
servants

government

realism

our

with

act

in the

appropria¬

tions they make from our savings

those

of

all

are

future

generations.

stockholders
ours

in

this

and it is

responsibility to hold our gov¬
officials strictly to ac¬
for
to

their

make

stewardship.

position

my

I

per¬

this point which is,

on

certainly, the most important eco¬
nomic issue of our generation. I
not

isolationist

and

I

all good

tinued

fair

investors.
not

treatment

These

naive

to

so

governments are
to expect

as

far removed from performance.

It is patent

is

it

private investor,

been
twice-cautious;

be

not

promises

a

fingers

will

burned,
but

that

his

once

have

him

to

that

directed;

are

these

they

are

designed to lure those who have
not

yet learned to shun

new

yet

the fire;

investors, whose skins
unscorched;

and

are as

government

inveighing against our entire
post-war program of foreign aid.

well insulated
by the epidermis c-* the taxpayer.
It is only on rare occasions that

I

we

am

an

am

not

that

know

have

done

much

has

what

of

been

we

dictated

by

spenders who

such

see

hibited

at

meeting
one

also,

know,

that

much

of

our

by

those

treatment

in

need.

Such

assistance

is

is

and

consistent

Christian

this

principles

nation

with

upon

which

founded.

was

the

portunity to contribute to the
human

home
will

and
do

misery,

abroad.

what

emergency

we

can

sweet

charity.

tense

that

a

as

name

honesty, when we
gifts bear clearly

and

am

situations

velop; but in the

friends

I

The

re¬

both
sure

to

at
we

meet

they de¬
of simple

give, let our
the label of
fatuous

nation

influence

as

that

representative

a

ex¬

international

of

was

pre¬

can

people

win

by

whatever

that too much
on the

took:

known
and

nothing but emergencies*
casually accepts gov¬

which

ernment

intervention in

and

commerce,

these

emergencies

desirable.

business^

finance

to

meet

normal and!

as

Furthermore,

we

now

facing a deepening and eve?
pervasive emergency which

are

more

to

seems

infinite
from

extend

future.

the

cept

private
our

—

far

out

These

into the

departures*

enterprise

con¬

detours

emergency

along the bypaths of expediency
taking us far from the main
highway: the private enterprise

—are

road

to

national

achievement; and

and

progress

in grave
danger of losing sight of the eco¬
nomic landmarks that have made
us

we are

free and progressive
people.

a

We must be very sure

that, in our
gropings for national security, we
do

mistake

not

the

shadow

for

the substance.

It will take but a few moments*of reflection to realize how indis ¬

777

tinct

some

of

the

old

landmarks

with,

huge*

expenditure for postwar relief un¬
der UNRRA, we have extended
our concept
of national responsi¬
bility to include a multi-billior*
dollar loan to help a friendly
peo¬
ple with a Socialistic government;
a
$17 billion program for Euro¬
a
Point IV pro¬
for technical assistance tounderdeveloped countries, which
pean

recovery;

gram

accomplish

can

small

field
but

field

good, at
within the*

government

competence;

which

harm

much

kept

cost,
of

if

if
is

capable

expanded

to

of

grave

invade

the

of

private enterprise;. and,,
continuing sense of re¬
sponsibility
for
the
protection

finally,

a

and welfare of all nations this side
of the Iron Curtain

which, we are
another $25 bil¬
lion during the next three years-

told, will cost

us

being placed

of

private

investors,

"What Are We Buying," in Giving*

Foreign

since investments should be made

so

private channels.

a free people
heavily mortgaged their future.

The time has

Political Pressure Back of Some
Government Foreign Loans

this attitude is de¬

I know that

Aid?

Never before has

through governments, rather than

There

will always be a need and an op¬
of

candor
recent

tries who protested

emphasis

entirely in the American tradition

a

are

of the under-developed coun¬

giving has been motivated by a
simple desire to lend assistance to

with

immediately available. Wo
must realize,
however, that we are
living in a generation which haa
are

new

existing
investors to respond to promises
so

no

for quickly
productivity of

faith, who have con¬ have
become.
Beginning
profess their readiness what then
seemed to be a

to

accord

to

is

the American

need

the

up

friends

our

There

among

the

on

en¬

vironment for private investment.

essential

will

foreign
obtain all

many

ment

requisite to

in

I

countries that they can
the investment capital they need
from the United States Govern¬

possible; and while
severe

but

pertinent.

very

One of the foremost obstacles that

rooted

judgment.

building

you

to sound economics and

as

business

the. Underdeveloped

the investments which make them
we

investors,

well

as

Countries

"Spoiling"

of

to

mediate violence may be done to
interests of private

the

disagreement

ance

lief

System meant to

Continent 'Central Bank' idea,
read

in

more

the

insist

I

thought that, as I recollect
it, when the Federal Reserve Act was first passed, the

on

every

of economic, yes, and mili¬
tary aid extended to foreign coun¬

considerations of national defense.

"I would like to offer the

for

penny

accustomed

count

seems to me cer¬

received

countries which

great democracy of

the banking business by Government."

value

as

proved environment is the firmly

ernment

Gestapo to

individual
full

improvement of other nations and
peoples. As businessmen, we are

our

that the

responsibility,
citizens, to insist
our

the

We

single loan and

over every

given bank

8]

it is

responsibility for the welfare and

want

[based

point,

inter¬

our

responsible,

are

wish

we

our.

fectly clear

thought

people, they can decide how far
they want to go, and how far it is
safe to go, in this matter of un¬
requited
giving.
Beyond
that

investors face in seeking this im¬

dis-equilibrium. We
are the
most generous people in
the world but, until recently, at
least, we also have been the most

and

follow:

American

technical

our

sad state of

similar

Mr. Rowe's further com¬

the

to

it

a

-

believe should

fairly

environment"

responsibilities

our

nations.

Foreign Aid

the

and

assure

meet

national balance of payments is in

Apropos of the subject, readers will recall that the t
"Chronicle" of Oct. 25 (page 8) gave the
full text of

on

If the issue is presented honest¬

ly

investment

;

].observations

no

This may appear to be a digres¬
sion from my subject ofV'private

other

danger of going

.

get

other.

to

x

throughout the country, together with the replies made thereto by Mr. John J. Rowe, President of
the Fifth Third Union Trust Co., Cincinnati.
Since
then, Mr. Rowe has favored us with some additional

shall

we

to

lock,

bankers and

assuredly,

underdeveloped coun¬
tries, investments to close the for¬
eign trade gap, and investments

as

others

receiving our re¬
joy of giving;

pure

a

friends

(the Patman questionnaire addressed to

the

engaged

activities

that

with

commensurate

sistance

we

by default.

in

enterprises

em¬

savings

the

lot in these postwar years
about economic aid, technical as¬

bear directly on this subject are,
suspect by shrewd design) not or¬
dinarily asked of those who could be expected to feel free
to speak in
straight-flung words and few. This basic issue,

every

his

put

portunity for profit. We all have
heard

government, to say nothing of the surrender of
principles of a free people and a free economy, can¬
not, of course, be of assistance in the struggle which must
be made and which must
ultimately be successful in free¬
ing this country of the manacles of a managed or planned
economy. It is obvious that in its questions about "con¬
flicts" between the
Treasury and the Reserve System
the Patman subcommittee has
carefully, subtly laid a
basis for propaganda iq favor of the chairman's own ideas
on the
subject.

enforce

to

risks, the greater must be the

basic

army

pros¬

for,

on

The surrender of what remains independent of the

"The

way

individual

an

wants

for

profit

a

Surrender!

of whether the Federal Reserve is to be turned
over,
stock and barrel, to the
politicians, is in

of

safe

ployment

central

ments

the

be reconciled to

to

essential

such means should be
exposed to
the ridicule it deserves. We must
ward

for

investors from

ing up the defenses of the free
tries; and the burden of proof as
world against Communist
aggres¬
to whether this vast
outpouring sion.
thousands
of
individual
wage- of our national
wealth, which is
I
am
quite ready to concede?
earners
have
entrusted
to
his
being projected far into the fu¬
stewardship,rln both cases, an op-k ture, is producing and will pro¬ that, in this time of great national
peril, the need to safeguard the
portunity is sought to put these duce compensating returns to the
national security must be the fore¬
accumulated savings to work in American
people must be placed most
consideration—whatever im¬
such a way that they will produce
seeking

a

..

receive

savings to constructive use,

istic;

questions

will

he

profits. The motive

or

same

pective

probability had the Federal Reserve been merely a
department or division in the Treasury. One must cer¬
tainly doubt that it could have been accomplished if the
Reserve had been an "independent" office
directly and
fully responsible to the President.

Such

which

adequate compensation in the

all

unfortunately (and

oldest,

value

unworthy of respect who
vestige of
independence of the central banking system or the sur¬
render of this vast source of power to the
politicians.
The "full accord" of some months
ago between the Treas¬
ury and the Reserve, however much its importance may
have been exaggerated in some
quarters, has obviously
been of some value. It has put an end to the artificial
support of a large volume of Treasury obligations at a
price above par and, of course, far above the market ap¬
praisal of them. It could never have been achieved in

;

the

mo¬

duce

as

felt it not useful to resist the loss of the last

No

of

one

his

is

urge to

Treasury." One would certainly need
to be naive (or
ignorant) indeed to assert or believe that
even in the
roaring Twenties, the Treasury did not play
a
very influential role in the affairs of the System. There
was
little independence left when we entered World
War II, and whatever

by

for

investor

strongest and, I dare say, most laud¬
able impulses known to man—the

"doormat for the

a

foreign

a

environment

The

tivated

that

Investing Abroad

does not provide

or

favorable

a

was

became what the late Senator Glass described

soon

decide

to

country does

inception, when
turning the world financial situation
topsy-turvy, politics in a broad sense was evident in its
management. When we became involved in that conflict,
World

loans

Promote

treatment

private

governments that have come to
them for financial assistance.
Both,
institutions
have
made
sound!

Environment Needed to

in circulation about

is

better

American

is

20

are

buying.

come

How

to ask what

in

much

wo

reai

protection against communist ag¬
gression?

How much in subsidis¬

by the conscientious and
capable officials of the Export-

ing

Import Bank and the International

governments;

Bank, who, time and again, have

torships in power; and protecting

plored

the

inefficiency

of

socialist

maintaining

dicta¬

these from the logical consequences of
rather their acts those whose trouble*
than to supplant private invest¬
are due largely to their own inefment; and who, in specific in¬
Continued on page 3G
stances, have been helpful in ob¬
stated

that

Banks

is

the

to

function

of

supplement

30

A

(1770)

The Commercial and Financial Chronicle
*

*

Continued from page 29 '

of

fact, and that good will is not
by
the
creation of hopes that cannot be

invested.

lost by frankness so much as
well-intentioned promises and

with

exchange

controls, import
and export restrictions, remittance
taxes, and differential exchange

fulfilled.

Environment Needed to

rates.

He

political corruption?

or

problems.

their vestment

C

toe^nnnn^o^nswer'^
uPpn to
'

,

substance

and

!irs+Vl

for,

treasure

without sufficient weighing of objectives and results—raises ques-

^p^pH^plljrtanCe
g

?ir

Xe? ab™ad; or

^

P|ay their part

The

to in-

o

in

build up the productivity of the
world's industrially retarded
questions of national se- areasT
e+?ec<Jn5P?iUeoSnc??pr tn
curity on the one hand, and of rives from the logical answ
national solvency on the
other, the first, and is concerned w t
with the hope of
preserving our the necessary elements of a favortions that extend

subTect

far

bevond

il^estoLit

of

my

ment:

political freedom

most

environment,

investment

able

delicately

concerned

or

reasonable

a

-the

value

of

I will

as¬

for

the

enterprises, and

with the service

.

additional

something

time,

be needed to attiact private
from
the
United

investment
States. The

American businessman

opportunities at home
profitable investment of
his savings. He does not have the
foreign exchange problem, and is
free to use his profits, after taxes,
as he sees fit. On the other hand,
competition in the United States
is intense. A businessman
must
work very hard to make a profit,
and profits on a unit basis are
small, as compared to the profits
obtainable in other countries. - •
finds ample

for

op¬

chance

a

invested.

concede that, at the pres¬

may

establishment

for them to grow and earn a
commensurate with

international obligations

ent

his

his income from that

given country; if it provides
new

1951

safeguard the private capi¬

tal already

I would say, then, that if the
basic economic requirements that
I
first listed are satisfied in a

portunities

Thursday, November 8,

.

and to

reasonable profits.

of

.

meet its

property, will not be dissipated
through
currency
depreciation;
and that he, or his
stockholders,
will not be deprived of the enjoy¬
ment of that income by exchange
blockages and inability to remit

is to be made in se¬
the additional productive
investment that is
so
urgently
needed; and it is predicated upon
the fundamental premise that the
United States is a private enter¬
prise country, where the private
investor is a free agent to whom
it is entirely a matter of compara¬
tive
advantage, as he sees
it,
whether he invests in country "A
or
country
"B," or keeps
his
money at home; and I only wish
that I could add, as a corollary
to
this
statement,
that nations
that owe their shortage of
in¬
vestment capital, of domestic as
well as foreign origin, to their un¬
willingness to provide a suitable
environment, cannot expect to
any progress

I recognize that our new con- that
cept of national responsibility— are called^
this readiness to pour forth our

national

wants

property,

these curing

At

meetings, there are two questions

'

•

be

must

that

surance

of course, is pre¬
sented from the viewpoint of the
private investor—as it must be if

Promote Investing Abroad
ficiency, their incapacity,

He

,

My answer,

.

r

profit

the

that there are few

It also is true

the risks and

impact of
in the
United
States.
differ¬
ential in favor of foreign invest¬
countries

rendered; if the

where

is

taxation

the

heavy as
The tax

so

foreign investor or entrepreneur
Tbe first question usually Barnes
feels secure in the possession of
wlth it the threat of some sort of
his property; if he is not faced
but I am very sure that this mat- government
action,
uuuer
the
with the hazard of depreciation in ment; however, is rendered in¬
ter of
encouraging private in- theory that the United States,
effective by our tax legislation
its value because of ill-considered
vestment
and
the
problems
of a great creditor nation, must ex- have their deficiencies made up
which
applies the high United
or
arbitrary government action;
facilitating capital formation and P°rt capital, if not by private inStates tax rates to income earned
by the United States Government.
and if he has the option of rein¬
national productivity to v/hich it vestment, then by use of public
abroad. Businessmen in this counr
When
balanced

against the

stroying

our

is

risk

economic

of de-

system;

intimately related,

so

close

to

the

are very
the matter.

heart of

funds.

Now, I will not concede that
It is the unparalleled
productivity there is any obligation on the peoof our private enterprise
system pie of the United States, individuthat has furnished, and is furally or collectively, to make any
nishing, the means of national investment or export any capital

move,

private capital is free to
it always tends to flow into

those

where

countries

portunities
and

and

industries

the

vesting

or

—then

he

remitting his earnings

try long have urged, as the great¬
est immediate incentive for an in¬

has every reason to
consider that the investment en¬

those

to

greatest op¬

vironment is

found for its safe
profitable:'employment; and
are

a

favorable

crease

one.

But what are some of the actual

in

our

foreign investments,,

United

the

that

Govern¬

States

adopt the principle, recog¬
nized
in the tax legislation
off
ment

conditions an investor encounters
there is no fundamental difference
sinews of war; that will not produce compensatas he investigates the investment
some 17 foreign countries, that in¬
between a local industrialist and
projection of this ing benefits for our people; nor
environment of a foreign coun¬
come
on
foreign
investments
a foreign investor in this respect.
productivity abroad through our will I concede that American priEach is looking for an opportunity try? He may find that the govern¬
should be taxed only in the coun¬
exports
of
capital,
materials, vate investors are in any way
ment has a strong socialistic bias
try where it is earned; and that
skills, and ideas that constitutes derelict in their duty, unpatriotic, to invest his own savings, or the
—that the trend is toward na¬
tax treaties be negotiated with
the chief hope of the free world in or
unduly timid, in failing to corporate funds, under conditions tionalization of
industry and in¬ other countries embodying this
that give promise that the invest¬
its hour of grave danger.
measure up to the expectations of
tervention by the State in eco¬
ment
will
be
principle and containing ample
productive
and
some theorist who calculates how
nomic affairs, He may learn that
provisions for the protection of
profitable.
The basic economic
pn9
many billions of new foreign inthere are deeply rooted inequali¬
Investments Go.
American business from discrimvestment
we
should
undertake requirements are not difficult to
ties in the social structure —
There are few who would quesinatory and unduly burdensome
each year to raise foreign pro- list: the new enterprise must have
*ion the desirability of
antagonisms that threaten to erupt taxes abroad.
increasing, ductivity or living standards to a access to a labor force which pos¬
in social conflict. He may discover
the flow of private
capital from level that he considers
It was pointed out, in a resolu¬
appropri- sesses, or is able to acquire, the a
the United States for
long-term record of exchange
productive ate.
In my opinion, our recent necessary
skills and has some
tion adopted at last year's Na¬
investment abroad—few who will
resulting in depre¬
sense of responsibility for its role difficulties,
annual
investment
abroad
of
tional Foreign Trade Convention,
not pay lip service to the desirciating exchange, and resort to
some
that
$1 billion, of new private in the productive process; access
application
of
the
high
foreign trade restrictions and ex¬
ability of developing a more recapital is not an inconsiderable to an economic source of raw
United
States
rates
to
income
change controls. As stated in a
ceptive and favorable environamount
materials; the ability to acquire
probably as much as
in
foreign
countries .
recent United Nations report, in produced
ment in the
recipient countries. can be
justified on any reason- locally, or to import, necessary what
creates
a
competitive disadvan¬
Some of these countries are maksurely must be the under¬
abie basis in view of the disturbed machinery and equipment; access
statement of the year: "The plight tage for American enterprises as
ing a real effort to improve the
an(j uncertain conditions; and I to an adequate and dependable
of a foreign investor on account compared with local enterprises
investment
environment, and it is am not
of
electric
power;
the
impressed by arguments supply
or those of other countries which
these nations which are receivof exchange controls is
frequently
that a disproportionate amount of right to
employ capable tech¬
exempt
foreign-earned
income.
considerable."
ing, and will continue to receive,
Now,
these
ex¬
the total is being invested in nicians and management of what¬
Although precise figures are lack¬
the bulk of our new investments,
this industry or in that country. ever nationality; and finally, and change difficulties may be due
ing, it is certain that the income
But what incentive is there for
to various causes—to fiscal mis¬
There are excellent reasons for most importantly, assurance of an
which the United States Govern¬
a
corrupt and profligate governthe large petroleum and steel in¬ adequate and dependable market management by the government,
ment would lose if it ceased tax¬
dent
to
eradicate
or
perhaps to some fundamental
venality
in vestments
that have been going for the product.
foreign - earned
income
public office; to institute unpopuweakness in the social or eco¬ ing
int0 Venezuela; for the expansion
would be very small compared to
lar measures of
Assuming that these basic eco¬ nomic background of the
economy; to get which is
country;
taking place in North nomic conditions have been
the ' tremendous
sums
,we
are
back to a sound and stable curmet, but the result is the same to the
American utility properties and
a
spending in an effort to increase
careful investor will want to investor. Investigation
rency that will have the confimay
also
manufacturing enterprises in make sure of his freedom to
dence of
op¬
disclose that local men of wealth foreign productivity through govr .*•
investors; to eliminate
Brazil; and for the rapid growth erate his business
ernment-to-government loans and
according to and, substance are not
discriminatory, unfair, and repres- 0f an kinds of United
putting
States in- his
similar devices,
sive measures
Our government, »y
best judgment, without prej¬ their own
against foreign infunds into productive
vestments in the friendly environtherefore, by its short-sighted poludice, discrimination, or fear of enterprises—that
vestors; and to discontinue the ment of
they are seeking
our great
neighbor, Can- seizure by the arbitrary action of
icy, is destroying one of the few
easy political practice of blama foreign
a(ja
refuge for their savings,
real inducements the less-devel¬
an unfriendly government. On the
or
are
showing a preference for
The American business execu" contrary, the investor will expect speculative ventures where the oped countries can offer our pri¬
vate investors, and is extending
tain
the
assistance
thev
need tive has learned> the hard way. to the government to uphold him in turnover is
quick and the profits
from Uncle Sam?
those coun¬
those countries whose rec- the possession of his property, so large. This is a clear warning that an open invitation totax rates on
ords are such as to inspire no contries to raise their
I said
long as he observes its laws and the investment
at
the beginning
climate
that fidence of
is
not
good treatment.
He accepts his social
industry to the levels prevailing
there is nothing at all
responsibilities. healthy.
complicated has become a
v-V
;• <,
hard-headed realist, In
in the United States.
The issue
ab
return, he should be willing to
Then, there are the legislative was stated
an, investors Reasoning and, in view of the softening ten- pay his
clearly -in a recent
when he lists the pros and cons
just share of the cost of a impediments. The investor
may
so
apparent elsewhere,
Survey of Policies Affecting For¬
of a conternplated business ven- cjencies
government which is efficiently find that there are
nationalistic
ancj the heavy burdens he must
eign-Investment by the United
run
and
ture in
a
honestly administered; laws which
foreign country.
He bear to enable his
may keep him from Nations which
government to but he will want to make sure
points out, in dis-:i
knows what he wants and what
hiring capable technicians, or leg¬
meet its
ever-increasing commit- that, if his enterprise is
cussing our system of tax credits,
he does not want. The
successful, islation which, by unfair taxation
infinitely ments, it is well that he
is.
He his
"Under-developed
countries
are :
profits, which are the rewards; or otherwise, discriminates direct¬
complicating element is the somesees no legitimate reason to
able to raise tax rates to the level:,,
divert for his
times irrational and
risk-taking, his enterprise ly against foreign
capital; or laws prevailing in the countries of reg¬
a]ways un- the corporate funds to a foreign and his hard work, will not be
predictable behavior of the govthat deprive him of effective con¬
investment other than the existration without a deterrent effedt
ernments
with
confiscated
which
by the government trol of his
investors
property. (And here I on investment, since the .total tax
pectation that, under good manmust deal: governments of
through unjust or unreasonable must
capishare
with
you
another burden on the foreign company p;
agement, and with fair treatment taxes.
slight understatement from the not increased. In general, rates of
^ry nationsreceiv® profess fr0m the recipient country, it will
who
Private be
All these conditions which are United Nations
are
lower
in.
under¬
study on Foreign taxation
productive enough to earn and
defense
and

it

and

is

•

the

the

.

,

inLSl

—

fflS whenu'feemfso ea^to ob*
Y

T

.....

sh^

.

.

.

....

,

-•

^ iiG <:reatl!^ ne^
^i fC that make it
f',and.allring 0tbfS,t0
exist,
impossible for

,

existing foreign enternricpc +«
foreign enterprises to
pand

or even to

ernments

of

survive; and
capital

-

ex-

gov-

return

but whose
the fields of

American

stock-

reasonable profit

a

currency th^v can use.
A
^ they
who is faithful to his trust
pllrrpnrv

take

no

in

official

acts

man
can

Requisites of Favorable
Environment

in

The

question

as

many

the

to

requi-

occasions, both in pri-

^

officials

States and in

in

the

United

foreign countries

the general subject of

environ¬

domestic and

some

unable

investment

from

by

a

signifi¬

countries that

to

attract

abroad

new

not.

are

on

foreign in-




•

on forei^n

•

x

.

investment problems.

I have found that the best
is

a

answer

simple and direct statement

Investment Problems: "Under
any
circumstarices, the prospect of na¬
tionalization gives rise to uncer¬

tainties.")
The

.

.

'

is scope for such
this

within

has

prospective

constitutional
which

,.

occurred, this great potential incentive to private enter-

investor must prise
look carefully into the legislative lOSt.
and

so that there
increases." Once

developed countries,

investment will
.

'

\

have

'

-

.

•

•

_

been
••

i

!.'

In the absence of this, tax incen-,

framework

citizens as offering attractive op¬
portunities for the productive in¬

operate; and if he finds that the
country has negotiated a satis¬

investor may still be at-tracted to a less-developed country
offering a favorable investment

vestment

factory

invest¬

environment, by the opportunities

United

afforded

of

many

their

of

their

own

savings.

ment
The Balance of Payments

There are, however, certain ad¬
ditional considerations that

a

for¬

eign investor must have in mind.
He must be concerned with all the

factors

entering

national

balance

into
of

the

inter¬

his

business

commercial

treaty

States, he

Problem

T

c

menf

favorable

foreign capital; and it is

regarded

vate
conversations
with
my
During the past few years I
friends in
the
Latin
American
have participated in a number of
area> which is my main field of
discussions
and
conferences
among businessmen and govern- interest, and in public discussions
x

a

with equal force to

have been

on

-x,

to

private investment apply

cant fact that

other view,

taxation, fiscal pol- sites of a
favorable environment
icy,
and
diplomacy frequently for
foreign investment is one that
have the effect of
inducing in- j have heen
called upon to answer
vestors to keep their
money at

°^e"

essential
ment for

a

exporting

countries who urge their citizens
to increase their
foreign commit¬
ments

the

to

holders

may

with

and

the

regard it

must

as an

in¬

an

,

resources,

by its untapped natural
industrial opportunities,

dication of good intentions. But he
is influenced more

and unusual

record

regarding the

by

than

the

past

by

I

am

sure

}
..

possibilities for profit.

that

what

I

have

.

said
ti

hazards of

foreign

anything " else.
investments should explain why
Nothing can impress him as much
an American businessman expects
as a
history of fair treatment, over
the years,, of both domestic and to receive a higher rate of return

of foreign capital; a record of earn¬
the country where his dollars are est effort
by the government to
payments

tive,

on

a

foreign venture.

the differential is not

k

,

",

In reality,

large at the

■

*

Volume 174

Number 5062

.

.

The Commercial and Financial Chronicle

.

(1771)
present time.
lic

utility

In the

roads, earnings
ments

are

American

less

than

in

business

enterprise,
its ideas, its
techniques, and its social outlook,
with

rail¬

and

foreign invest¬

on

even

of pub¬

case

investments

has- made

the

shortage of in¬

na

in

vestment

these

•

which

fundamental to all

are

This

matter

of

much

tween

return

ment,

yield

or

misunderstanding

the

be¬

learning.

relatively

terms

obtainable

governmental

easy

'

governmental

agencies.

is

•

This

by

attitude

well

is

conversation. I
government official
South

to

on

with

i would

a

America.

to tell him

care

As

private

enterprise men,. we
the challenge of Statism,

meet

can

whether

it

arises

from

the

new

with

whom

do

we

peoples

business;

we

must play a larger role in the de¬
recent
velopment of foreign policy; we
Having must
maintain our contacts with

the

who

men

Washington,
fields

of

represent

particularly

what rate

in

and

commerce

in

us

the

foreign

of

that

personal

a

which

economic

live,

we

tide

we

of

resurgent
make

ourselves

strident

tion.

system

Statism

would

you

asked.

"Oh,

plied.

"What

consider

right?"
4%," he

about

'

interest

I
re-

rates

personal
savings accounts in your city?" I
inquired. "Around 8%," was the
; answer.

"And what interest would

have to

you

if

pay

borrow

money

bank?"

you.

to
local

were

"Probably

from

your

10%," he re¬
plied. "And yet you expect a foreign investor to expahd and de¬
velop his business while paying

•taxes to your, government as well
as to his own on
earnings far be¬
low the going rate| of interest?-"

;"I

see

point," he said,

your

"but

your :

money
comes
from
the
United States where interest rates

much

:

are

have

lower

where

and

you

ever

before in the selection of the men
who represent American interests
abroad.

do

your local banks pay oa

than

more care

I feel that this last
point cannot
stressed too strongly.
In too

be

instances, the difficulties

many

American

-

owned

enterprises

heard

voices of

above

economic

We must be

more

in

the

production in which all
doms
now

at

are

stake.

reac¬

who have

had

the

the

tion.
we

raw

But

we

choice but
forts

can

to

friendly.

the

have

we

our

are

today and
increased if

which

first

trip

and

which

from

our

our

the

list

were

determined not only by the
'supply and demand for invest•ment

er's

funds, but also by the lend¬
evaluation

the

of

risks

tion.

have

we

do's
com¬

experience,

over

foreign countries.

In the

there is

little sentence that

a

it all up and
used as

which could well be

guide in the selection of

a

political

our

in¬

sums

as

well

as

our

busi¬

But

govern¬

influence
power

private

enter¬

It

is

people.

our

government

political abstrac¬

vague
a

government of men
to
the
will
of. the

responsive

We

are

part of that will

the field of foreign
policy
all the attributes of

possess

leadership.
Let us exercise that
leadership and justify the faith
that is within

us.

Brady Now
With Barbour, Smith Cor
(Special

LOS
J.

to

The

Smith

is

&

Flower

now

Company,

Street.

In

with

was

—

with

the

he

had

trading

Victor
South

past

was

factual basis for the belief that
there was a surplus of investment
no

of

the

New York office of A. G. Edwards
& Sons.
'

^

capital in the United States

or

any

shortage of investment opportunities.

We agreed, finally, that the
proper rate of return must vary

;

representatives
in
foreign
countries: "Where the instincts of

gentleman do not exist, volumes
of suggestions will not suffice to
prevent the creation of ill will."
I

hope that what I have said
today will help our friends in the

'from country to country, and from

less-developed countries

•industry to industry, and

stand

•will

tend

to

be

that

whatever

is

quired to keep an enterprise
nomically sound and, at the

it

re¬

eco¬

our

viewpoint,

as

we

that

can

do

about

the

This, and

:

nationalism

other

and

political

and

(Special

SAN
ter T.

h

a m

tage of their hospitality; and I can
you 1 that this belief
is as
strong in some Washington /quar¬
or

South

America.

^regrettable fact that, in
occupation

with

our

It
our

is

a

pre¬

daily finan¬

cial and operating problems, we
^investors have neglected our pub¬

lic

relations.

•the
?of

time

foreign

the

We

have

refute

to

not

these

exploitation

stock-in-trade

of

taken

charges
that

are

Communist

aspects.

We

through the
of

have

stored

up,

years, a vast reservoir

knowledge

and

experience

dealing with foreign
peoples.
We
have

nations

in

and

a

realistic

Pinska
&

is with

Co.,

ert P.

*t

has

^invest,
these

had

a

fair

opportunity

to produce, and to
new

vistas

of

to

open up

hope

Opportunity.




and

and

what

it

have
is.

helped
We

to

know

make
also

232

Harris, UpMontgomery

to The Financial

the

Hfggjfns,

staff

the

manifold;

are

longer-term

market; and protests that he is much

more

trends

interested

of

in the

If Mr. Tabell's essential interest

really is, as he reiterates, con¬
to individual stocks, and if the expression "the market" is
merely necessary short-hand for "the majority of stocks," then it
is difficult to understand why he and most other technicians devote
so much space and time to "market"
anticipation, instead of to dis¬
cussion of underMr.

Tabell's

over-valuation

or

hypothetical

of

specific individual issues.

example of his and

my respective
buying a stock a year before Korea, seems to leave
completely uncontroverted the fact that there is a crucial obstacle

processes after

put in .his way whenever any of his several tools contradict each
other.
I, on the other hand, with only one set of criteria con¬
trolling—namely those related to furnishing me with the prob¬
ability of recouping my capital, plus its risklesss rental value, plus

extra

true

the

increment

derived

events

of

investor's

through income, over a 20-year
switching tools in accordance with
He does not seem to realize that

with

unconcerned

difference

the

day.
is

concern

between

our

with

value

derived

approaches

does

through income;

not

merely involve
•differing methods of trying to anticipate fluctuations in market
price.
Not
I

tion

not too much

am

of

value-analysis

of

a

Too

Pure

purist to

see

occasional

by

advantage in cohfirma-j

other

elements.

.ample, recognition of psychological elements
prejudice

or

For

ex-

(as overenthusiasm,

other foibles of the crowd) which

divergence between

a

the detected

cause

stock's market price and its appraised value,

important confirmation of the value appraisal.

an

Assuredly,

But

set of tools I will not

one

use,

in the most

even

ancillary way, is that based on interpreting the market's
own

internal "evidence."

but I

of

paragraph): "Of

Remer,
208

added

Mitchell

Wilson, Johnson
Montgomery

This
an

no

issue

doubt

South

La

to

the

staff

Reitzel,

the

assumes

conclusion,

variations, thus based
continue,

LOS

a

bullish sign.

an

of

of

group,

evidenced

dispro¬

Actually Ratio Theory in

or

vs.

trend—whether

stocks,

"the

issue moves, the

more

Inc.,

likely to be

Successful

or

of

an

generally

systems

general

applied

performance

to

individual stock vs. its indus¬

market"—essentially

is

directly

It assumes that the lower

less is its value (i.e., the cheaper is the more

so.

artists in various fields usually

Salle Street.

his techniques,
has

ANGELES, Calif.—Samuel
is engaging in tiie se¬

Not

hazy over the

actual

practice, forecasters using the economics and mar¬

to

"rub

in"

the

1929

or

debacle,

jointly, have not fared well.
which

unpleasantness

founded. when it did not actually bankrupt, both the
the

Mr. Tabell

awfully fine ear!

ket-analysis "tools," either singly

at

are

Despite elaborate explanation of

the music genius largely plays by ear.

an

In

to The Financial Chronicle)

ANGELES, Calif. —Sam
Husbands, Jr. is with Dean
Witter & Co., 623 South Spring

the gen¬
a

expensive); when surely logic dictates that just the opposite is

Terman

LOS

or

the premise that evidenced disparity

on

contradictory to investment functioning.

(Special, to The Financial Chronicle)

la Ratio philosophy, that

characteristic of technical

and

between individual

Samuel E. Terman Opens

E.

a

selling signal; and that, conversely,

mechanics of their achievement.

(Special

volu¬

end of

I have the added advantage of

going down vis-a-vis other comparable issues

tinuation

300

&

course,

are

(at the

(including the latest Moving-Average gadgets), presupposing con¬

to The Financial Chronicle)

has* been

The relevant factors

Mr. Tabell's statement

cite

would

observing how the stock is acting relative to the general market."

will

Remer, Mitchell

(Special

Street.

processes

detecting

fined

its

Chronicle)

CHICAGO, 111.—Eugene Kuhne

ment

the

to

trend of individual issues than in the general market.

try

Joins

H.

in

those portions of Mr. Tabell's letter

on

that his graphs and other indices

us

confined

are

portionate rise constitutes

Chickering has been added

&

frustrations, the waste and ineffi¬
ciency, that come when govern¬
intervenes

the

his third

Street.

it

the

EDMUND W. TABELL.

manifest important key fallacies:

to

assures

they

minous;

Chronicle)

jagitators and unscrupulous politi¬ produce, for that is our business..
curities
business from offices
cians.
We have never publicized We
know
the
energizing
and 4121 Wilshire Boulevard.1
(the real and inspiring
story of transforming powers that surge
progress and achievement that has within our free, competitive, capi¬
Dean Witter Adds
been written by American indus¬ talistic
system; for we are part of

try at home and abroad—wherever it,

the

of

reserve.

distant

FRANCISCO, Calif.—Rob¬

to

under¬

standing of their limitations. We
know how to plan, and build, and

in

precedence.

Wilson, Johnson

and

a
practical
knowledge of their production po¬

tentials

to The Financial

(Special

SAN

ment, particularly in its economic

is in India, the Philip¬

as it

He

that

Consolidated In¬

FRANCISCO, Calif.—Wal¬

With

investors can, and should, play a
positive part in guiding the for¬
eign policy of our own govern¬

ters

seem

eral market, denotes a

economic

to
foreign investment.
we
The positive
action
required to
partly to blame for remedy these conditions can be
the persistence of the belief that taken
only by the countries affect¬
we
selfishly exploit the peoples ed; while the investor is limited
•of the
less-developed countries to the negative gesture of keep¬
-and, somehow, take unfair advan¬ ing his money at home.
But we

pines

with

of

are

.tell

Chronicle)

Street.

ences, have convinced me that

investors

is

amounts

power

alleged

similar experi¬ obstacles

many

Financial

Harris, Upham Adds

such

most

The

small

such quantitative investment-value criteria still must always take

vestments, Inc., Russ Building.

After all, there is very

little

to

thing I

same

consideration and

using the technical method to check

(Signed)

Our comment follows
which

FRANCISCO, Calif.—Ann

Abel

private

investors.

cessive

;

L.

to under¬

matters as exchange
controls, im¬
same
restrictions,
inflation,
illtime; attract the capital required port
for its necessary expansion and considered social legislation, ex¬

.growth.

(Special

SAN

buy

buying

future

Stock Exchange
Street, New York.

35 Wall

serves'as

With Consolidated In v.

a

likely the
into

found 900
and

appeared un¬

of

ness

volved; and I added that there

and
some

'

Mr.

manager

department

issues

that

Members N. Y.

Los

been

Most

present

300

Walston, Hoffman & Goodwin,

external

Angeles
office of Buckley Brothers.
Prior
thereto

the

and

action and

you

Sincerely

a

Barbour,

621

the

the

undervalued.

statistical approach

.

term—am

Chronicle)

ANGELES, Calif.

Brady

Brady

Financial

and

thought that

is bad policy. Instead of
hopelessly confusing the issue by falling between three stools,
it puts a third leg on a
two-legged stool.

some

Victor JL

his

of

a

an

as

the

Well, if

both assertions

I still do not think that

the economic

number

our

vast

economic

encourage

not

we

surplus of capital." I ex¬
closing paragraph of this booklet,
plained; then, that interest rates
a

is

em¬

undertakes

to

and in

in dealing with people

years,

of many

he

abroad—-a

don't's

piled
the

give to each of

when

a

its

use

free world.

We have a little booklet

we

will

overvalued

is

such

prise development throughout the

suited for their tasks. .In
my own

business,

be

can

ment

market,

poor

ef¬

many

countries

do?

you

would take

no

environment

There

the

only where

go

and

concentrate

where

I

avoid

materials of produc¬

welcome

are

do.

the

and

the

control 'the investor's

outlook

undervalued group and have

of

initiative to seek out and
develop
in distant lands the
resources that
are

shall

statistical

dervalued, what would

This battle is

vision

and

would

being waged on many fronts
American
private
investors

by

American business who are poorly
equipped and psychologically un-

ployees

fundamental

free¬

our

that

may sell possibly 20% lower with
"better quality secondary issues"

further state "certainly not both."
issues that appeared overvalued from

the

battle

opinion

my

ai pretty

is

average

you

active and

decisive

reconcile

You ask which assertion

vocal, for, in defending pri¬
enterprise
at
home
and
abroad, we are holding a major
position

cannot

any

appear

certain

more

in

countries have been the
direct result of the friction and ill
will created by representatives of

average,

vate

of

foreign

You

and

determined and consistent ef¬

must exercise

age, even though I admit that
picture of the entire market.

resist the

can

in

currently earning a 10%
"Why," he said, "that's
altogether too much." "And what
return.

•

opinion, it would be rather cumbersone to say "I believe
(listing 900 stocks) are going to sell lower and (listing 300
stocks) are going to sell higher. Instead of that, I use an aver¬

by

fort

better investments

•

ket

faith in the free and

our

progressive

tional Foreign Trade Council, who
are
fighting our battles; and we

our

•

advantage.

tremendous

of

one

4

page

our

days

and

was

was

and was

.

and

need

critical

policy; we must contribute more
being earned. I re¬ of our time
to the work of such
plied that that'particular company trade
organizations as the Na¬
of return

•

venture

abdicating our hardin the foreign in¬

a

learned that I was connected with
the principal investors in the local
.electric company, he asked if I

i

We have not

with the governments and

illustrated

had

a

trip

'

the

at home or the
businessmen, which
may reach 30%, 50% or more an¬
burgeoning
nationalism
abroad;
but we must tell our
nually on the capital invested, are
story; we
must improve our communications
viewed with complacency;

.

4

not

in

has

the

voice in the defense of our funda¬
mental principles. Each of us must
resist the temptation to
compro¬
mise on principle for the sake of

United by

static sys¬

a

grope

internationalism

ceived by local

■

:

not

from

ahead;

gaining

still

are

vestment field.

•

re-

in

position

won

ten-

higher returns

do

eagerness to

are

many
a

; dency to look askance at reason¬
able earnings on the United States
capital invested in local industry

while the much

our

we

In

these countries, there

of

:

to

over

made

and

Ours is not

We

lost

inter-

and

gloss

were

shadows of the past.

borrowings

on

that

claim

no

nor need we

We have learned

us.

tem.

from

possible.

in

but we must learn to
stand together and
speak with one

early

States
•

need make

we

of low interest rates in the United

the

this

lie

days, when the for¬
eign investment field was new to

the

and

made

mistakes

those

our

'

-

has

perfection,

source

investors and the people
less-developed countries,
impressed, as they are, by reports
of

that

With this record of solid achieve¬

investment has been the

on

of

counsel

progress, and we need make
apologies for the profit incen¬

tive

eco¬

nomic development.

1

nation

man

key industries,

The

contribution to the history of hu¬

to account for the

Continued

lands.,

unique and matchless

a

United States—a fact which helps

'

of production and
trade, for we
have seen its failures inv
many

its discoveries,

31

economists;

con¬

chartists and

the market in its doldrum-whipsawing behavior

during the highly active business period from 1946 to 1949 vividly
m,

demonstrated

complete

non-existence

of

a

market

trend

con¬

forming to either the external economic factors or the technical

£ignalS'

'

A. W. M.

32

The Commercial and Financial Chronicle

(1772)

Association

ensuing

following officers were elected

the

to

for the

serve

ocean

would

of the Security Traders

German;

for officers
Association of New York for the year 1952.

[

unin¬

remote

places. Personally I
to be quite sure that

like

figured

have been nominated

in

or

guided

our

ASSOCIATION OF NEW YORK

following candidates

the

for a time, had them
unloading most of their bombs in

habited.

The

when they !
radio beams j

war

bombers and,
the

SECURITY TRADERS

the

last

the

jiggered with
which
guided

Notes

NSTA

from. The British did
of that general sort

came

during

year:

J

Thursday, November 8, 1951

.

something

of the New Orleans Security Traders

At the annual meeting

.

they

ASSOCIATION

TRADERS

SECURITY

ORLEANS

NEW

.

that

missile

some

experts

of

way

missiles

their

have

being

sure

be

won't

dumped right back in our laps
before they start turning them out
in

production.

mass

Another

developed

why

Korea
Arthur J. Keenan

G.

Shelby Friedrichs

J.

Keenan, St. Denis J. Villere & Co.

Vice-President—G. Shelby
Friedrichs

&

jet

is

they

than

Delegates

(and alternate

delegates)

elected

to

Inc., to be held at Miami, Fla., were

as

hit the number
is

parts

far

j

more

j

propeller-driven
the tail of

on

old-

an

i

propeller plane, an air war
authority told us, a fighter may

type

at the

serve

so

are

in

planes. Once

Inc.

go

vulnerable

limited

Secretary-Treasurer—John J. Zollinger, Jr., Scharff & Jones,

it seems, is j
fast that it j

answer,

jet planes

over

''kills'*

few

so

to

as

battles

extremely difficult to hit them,;

of

annual convention of the National Security Traders

in

result

and when

Friedrichs, Howard, Weil, Labouisse,

Company.

potentiality

injury

an

plane

relatively. The

John J. Zollinger, Jr.

that

President—Arthur

from

the

.

striking

Association;

J.

John

Meyers.

Charles

Jr.

M.

have

as

take

follows:

much

]

a

as

three minutes to

Delegates—Wm.

Zinzraf

good bead. With a jet j
plane the comparable time is two

Alternate

Harry L. Arnold

statistics rather

Perry Brown, Newman, Brown & Co., Inc.;
Gilbert J. Hattier, Jr., White, Hattier & Sanford.
' ,

and

Delegates—Joseph P. Mintree, Steiner Rouse & Co.;
John J. Zollinger, Jr., Scharff & Jones, Inc.

they

MICHIGAN

be

Baker, Simonds & Co.; Richard A. Carman, Manley, Bennett &
Co.; Robert Moons, Manley, Bennett & Co.; and Victor Williams,
Paine, Webber, Jackson & Curtis.

back of sorts for those Communist

Continued

Meyers, Jr., Gordon Graves &

from,

page

4

theorists
that

Second

Vice-President

—

Charles

M.

Zingraf,

Laurence

M.

Secretary—Alfred F. Tisch, Fitzgerald & Company, Inc.

business.
true

(Tvvo-Year Term): Edward J. Kelly, Carl M.
Loeb,
Co.; Daniel Gordon Mullin, Tucker, Anthony & Co.;

tries.

thai & Co.

r

(Two-Year Term)

of
:

Samuel F. CoJ-

well, W. E. Hutton & Co.; John Gahan, Schoellkopl", Hutton &
Pomeroy, Inc.
' '
.

of

them

or

year

a

so

hence.

y. •

Financial Implications
Underemphasized

1

.

>

Inc.; Cyril M. Murphy, John C. Legg & Co.; Barney
Nieman, Carl
Marks & Co., Inc.; John J. O'Kane, Jr., John J. O'Kane, Jr. & Co.

,

-v.fr

Nominating

Committee

(Four

(4)

Members

to

be

(Arthur J. Burian, Daniel F. Rice &
Co.; John T.
Baker & Co., Inc.; J. S.

Cusack, Amott,
Duga, Merrill Lynch, Pierce, Fenner &
Beane; James B. Durnin, H. D. Knox & Co., Inc.; Paul G Fred¬
ericks, Jr., Warren W. York & Co., Inc.; A. Kingston
Ghegan,
Edwin L. Tatro Co.; John H.
Gertler, Barr Brothers & Co.; Richard
H. Goodman, Shields &
Co.; Walter Kane, Shearson, Hammill &
Co.; James F. Kelly, Kidder, Peabod.y & Co.; James T.
McGivney,
Hornblower & Weeks; John S.
McLaughlin, White Weld & Co ;
Herman D. Meyer, Gruntal &
Co.; Frank E. Mulligan, Joseph
McManus & Co.; W. Foster
Webster, Hardy & Co.
'
:

<

•

Elected):

-

Nominations

Committee

can

other

than

those

selected

be made by a petition

by

in

Members of the Nominating Committee

billions

ing

into

in

200

Club

Richy Goodman




Richy Goodman
J. Donadio

government financ¬

So,
be

j

stand,

matters

as

heading for

accurate

more

if

to

say

the

talk

is

likely

defense

the

about

dominate

to

pro¬

out a defense
dimensions now
being contemplated will produce
a
Federal deficit of truly fright¬

brief is the nature

of the crisis. The Federal govern¬

is

ment

now

scheduled

to

spend

debate

level

all-out

hence,

year

imminent I

problem
minor

am

will

a

place

will

$85 and $90 billion dur¬

ing the fiscal

about

1953,

year

ending June 30,

billion

$65

of it for

defense. It is scheduled to collect

only

$70

about

billion

in

taxes,

including taxes added by the tax
bill passed at this session of Con¬

That

gress.

means

deficit of

Federal

If

$10

for

prospective

a

$15 to $20 bil¬

billion

more

were

more

air

groups

and

thinking

in

be

survival.

But

all-out

—

the

Well, what of it?

on

up

Why not slap

enough more taxes to make
the deficit? That is right where

the

financial

crisis

In

comes.

the

tax

to

must

to

at

stockpile

the rate
extremely

a

collect

anything

billion

more

like

$25

up

to

to

it

well

is,

it

they

hesitant

to

lot of planes and tanks

are

before

obsolete

expenditurej|
Siamese twins.
j|
up

or

going down

I know of

a

highly desirable

re¬

placement of capital expenditures

they

spread
some

of

opinion, including that of

sales managers, a

the

plant

large part

equipments of

and

American industry is worn out or

obsolete. It is
it
the

a

safe guess that if

thoroughly

were

modernized

operating efficiencycould be
at least 20%. The pro¬

increased
of

doing it would sustain

get to the stockpile. They would,

cess

I

prosperity and the result would be

imagine, -much

models of
as

prefer to keep
weapons in flux as

new

thus

possible,

to know, our

geared

course,
very

our

be

which

a

military, supply
With military technology

appeal

brake of sorts

cannot be

gen-|

of capital

be

might

me,

long

structure

remote

general!

I expect

to

Such

structure.

occurs

judgment of those best equipped

rickety Federal tax

more

up,

Expenditures

.

anticipate,

today,

program

people.

prospective
deficit would be $25 to $30 billion.
1

does

defense

moving

mentioned

I

take

Replacement for Capital

elemental

as

fast!;

pretty
to

the for the defense program. It is
trimmed capital expenditures to modernize
and improve the operating effi¬
down to proportions which can be
carried somewhere near on a cash ciency of American industry. Con¬
and carry basis with the present trary to what I find quite wide¬
it

than

atomic development—that is

ly

if,

seems

war

the figure of added cost frequent¬

more

of

terms

orlj
economy!!

prosperity and the

level

,

between

trouble

going £

year

a

they stick right together.

of

We

take

importance.'

our

emerges

Whether going

that the fiscal

sure

in

do,

economic

are

seems

war

are

off

indecisively—the

of

eral

ening proportions. If by that time,
a

expen-|

the slack. Regardless of cause and.
effect—an issue which economists!!

drifting

carry

of

to

nothing

is

program

capital

account

they

into

get

can

are

we

its

falling

When

so.

situation—it might

a

defense

on

start

a

out

turn

predicted. '-fC

the

expanded,

to

presi¬

a

campaign year.

program

Here in very

Points

on

putting

a

the defense pro¬

On

while

we

heavy

a

recent trip

into

to Washington

our

continue

load

defense

gram.

$30

higher standard of living,

a

lot

of

which

for

to

our

even

carry

the

expenditures

for

it

appears

years

to

will be

come.

taxes, or $15 to
$20 billion for that matter, with¬

I

out

where those who should know say

of
military tech¬ equipment to capital expenditure
nology. It seems that one possi¬ for modernization is not going to
bility in guided missile warfare is take place automatically.
It is
that the enemy will devise con¬ going to take place only if sales

that

falling

in

apart

.

at

the

seams.

Both individual and corporate tax
rates have been

5 Point Club

203

dential

during

steam

will

comfort of

things don't

as

prob-j;

promotes- humility,!;!

ditures

ly possible to get much effective

of

improbable

greatly

behind which it is hard¬

political

ex¬

gram.

The Security Traders- Association of New
York
(STANY)
Bowling League standing as of Nov. 1, 1951 are as follows:

"

atomic

more

which the

crisis

the

Unless

—where

added

(Capt.), Ghegan, R. Montanye, Krassowich, Manson. 30
(Capt.), Tisch, O'Mara, Nieman, Bradley_„J_J______
27lk
[ Goodman (Capt.), Weissman, Farrell, Valentine, Smith_I_H 25
Serlan (Capt.), Gold,
KrumholZj Young, Gersten_.
24
Donadio (Capt.), Rappa,
O'Connor, Whiting, Demaye
24
Mewing (Capt.), G. Montanye, M. Meyer, LaPato, Klein___
23
Bruian (Capt.).
Siepser, Gronick, Growney, Kaiser__
22%
Hunter (Capt.), Craig,
Fredericks, Weseman, Lytle______
22
Krisam (Capt.), Gavin,
Gannon, Jacobs, Murphy
20
Bean (Capt.). Lax, H.
Frankel, Werkmeister, Ried__ ~
~ 19 *
Greenberg (Capt.), Siegel, Cohen, Sullivan, Voccoli
18
H. Meyer (Capt.),
Swenson, A. Frankel, Wechsler, King___
15

for

matter of months this finan¬

a

cial

SECURITY TRADERS ASSOCIATION OF NEW YORK

Leone

in

precisely

process

the

It

when

sort

and

a

.5>.Y§

philosopher';5

"it is part

it also provides

difficult

is

that

defence pro¬

lion.

.

air groups,

and

time-consuming process. It is also

is very clearly moving. But

gram

were:

.:

expansion—

more

happen."

sys¬

But

ancient

that

tax

a

development. There is

crisis

Wechsler,
Ogden, Wechsler & Co.; John M. Mayer, Chairman, Merrill Lynch,
Pierce, Fenner & Beane.

TEAM

talk

ability

of

overhauling
Federal

ramshackle

further

largely

pushed fo

increases

self-defeating.

a

point

ran

a

illustrations

of

striking

However,

extraordinary

expenditure

couple
the

of

a

shift
for

from
war

-

capital
making

potentialities

devices

which

will

-

inflate!

fatal collapse,

a

Aristotle that

of
defense needs,
what is called for, of course, is a

runs

further

of

billions for

the

Nominating
the Secretary

Kumm

the

.of

tremely little talk relatively about

Louis A. Gibbs,
Laird, Bissell & Meeds; Michael J. Heaney, Michael J.
Heaney &
Co.; Milton Van Riper, John C. Legg & Co.; Arnold J.

r

defense

terms

weapon

eligible to vote for candidates.
days prior to the Annual Election.

_

the

program

most

present

more

the

presented to

endorsed by 15% of the members
All nominations close 15

At
about

more

>

Overhauling Needed

Regardless

our

saying
could : be

thinking about what is going;-'
to happen in the future I always!!
keep in mind the dictum of the|
illustrious

tem.

;;

f

_

National Committeemen Alternates: James F.
FitzGerald, W.
L. Canady & Co., Inc.;
Irving P. Grace, W. C. Pitfield & Company,

sight.

Tax

thorough-going

rr4';v:

,

in

are

been

In

large sources of new taxes

other

selling their

I doubt if this will be true

many

"

<

National Committeemen: Samuel Magid, Hill, Thompson &
Co., Inc.; Edwin J. Markham, Wertheim & Co.; Stanley L. Roggenburg, Roggenburg & Co.

indus¬

goods

rather than

wares.

Trustees of Gratuity Fund

is notably

this

capital

Now many of them are ra¬

tioning

Henry Oetjen, McGinnis & Company; Lewis H.
Serlen, Joseph-

think

I
the

of

have

capitalists

ourselves into

Treasurer—George V. Hunt, Starkweather & Co.
Directors

who

we

counted upon to spend and

After Mobilization—What?

Marks & Co.

Rhoades &

should!

trimmed "along

the generalf
lines I have indicated, it would,
of course, increase the leeway for
civilian business. Also, it occurs to
me
that it might also be a set¬

President—Harry L. Arnold, Goldman, Sachs & Co.
Co.

|

deadly]

other.

if the defense program

Members of the Program Committee are Leslie C. Muschette,
of Michigan Corporation, Chairman; William P. Brown,

First Vice-President—John J.

j

That, in|
a world like this, is not ah alto-1'
gether cheerless thought, r-r r ; j

First

Tisch

those

fast that neither

with the

contact

Inc. will hold their annual fall party on
Club. Cocktails and music are scheduled for 6:00 p.m. with din¬
ner to follow at 7:30 p.m.
The charge for guests is $10.

F.

so

side will be able to make

Michigan,
Nov. 9 at the Detroit Boat

Alfred

not

are

find

I

incredible, but if j
more than
a few

get to moving

The Securities Traders Association of Detroit and

George V. Hunt

seconds.

hundred percent off, they suggest
the possibility that air war will,

SECURITIES TRADERS ASSOCIATION OF DETROIT AND

;

half

a

re-route

would

be

trol

And

no

guided missiles right back where do

men

of the appropriate

an

equipment

effective job. -Many man

Number 5062

yolume 174

.

.

.

The Commercial and Financial Chronicle

(1773)

33

Of
industrial enterprises enjoy having it that way;
Of of course, raises the crucial ques- vival more difficult for small of private business management
obviously have np idea of how course, the fixed income group tion of whether or not the in- companies which individually in the fields where it now operantiquated
their
establishments gets progressively robbed, but centives will be-adequate to get cannot afford much in the way of ates an essential bulwark of
are.
This is attested by the fact they have relatively little political the work
done properly.
Put research, and are not clever personal and political freedom,
that government studies indicate power.
another way, the question is enough, to get together, in cothat in a number of important
Some of the other reasons why whether the income levelling operative research operations
||
■
# M
lines of manufacturing the most i anticipate a continuing upward which has proceeded so rapidly in with other small companies. ;
llOIHlllGBS 101 UOVSi
efficient plants are four times as trend of prices have to do with recent years will continue to the
i r
■
■
efficient as the least efficient.
A (i) the tremendous power to get point where incentives will be
Problems Continuing
0l tXClli rlMIS ASSIh
key part of the job Of getting wage increases which has been blighted.
I have stressed the prospect that
n
.
,
,
~
American industry modernized is mobilized by organized labor, (2)
I think I know the answer to after mobilization sales execufollowing nave been
to get these zombies waked up— what, in a pinch, I believe would one part of the question, but not tives and business executives gennominated to serve as Governors
largely a job for salesman and - be widespread popular insistence to the other.
erally, for that matter, are not °?
Association, ot btock jmcsales executives.
that policies designed to insure
likely to run short of rugged cnange firms for the periods lnIf we are not to suffer a gener- fun employment be adopted, and
Income Levelling to Continue
problems.
They" are going to be
cated.
ally debilitating letdown in capital (3) the very wide margin of opThe process of levelling incomes, operating in an economy that is Until Annual Meeting of Members
expenditures it will also be neces- tional consumption on which I after taxes, will, I am confident, very
fast-moving, an
economy
in 1954:
sary, I fear, to do a far better have already dwelt.
continue—perhaps with a little that has great elements of in- * *Edmond do Pnnt Eram*!* T
job than has been done in creatrespite now and then. But I have stability, and an economy that du pAnt & Cn
Wilmington
Dpi*
ing some popular understanding
Appetite for Wage Increases
no confidence at all in my judg- may get extremely 1 o p s i d e d
''
*'
*
of the role of corporate profits in
in this postwar period the lead- ment on what it will do to incen- at times, with parts of it thriving n
iS,r«* LJarkf
our
economy.
As matters stand, ers of organized labor have given tives.
It looks to me as though and other parts full of aches and H°dg.e & Co., New York City,
many, perhaps even most of my their clients an appetite for an- personal income taxes
have;al- pains such as those recently (and
Marco F. Hellman, J. Barth &
fellow citizens, seem to feel that nual money .wage increases far ready reached a point in the high in some measure currently) expe- Co., San Francisco,
a blow had
been struck for wis- larger than can be absorbed brackets where they put a major rienced by some of our textile and
E. Jan'sen Hunt, White Weld &
dom
and
righteousness
when through increased efficiency of blight on the incentive to work, appliance industries.
The pros- ,Co., New York City
another hike is made in the cor- labor or the efficiency of its appli- But, so far as is visible to the pect that the economy may astlnvd w Mn«?nn PaW WphhP-r

agers

,

.

.

.

,

,

Actually, cation. The managers of industry naked eye, the people in those sume. some remarkably lopsided •*£
provide have, of course, aided in this brackets keep right on working postures is heightened by the fact
two-thirds) of the process by being a soft touch most themselves to death.
This phe- that for years large segments of
rate.

porate profit tax

ritv

however, corporate profits
most

(about

>

funds for new industrial plant

like

effort

to

At any rate, the only

Consequently, what way it has been possible to acpolitically attractive commodate the wage increases has
down corporate been by increasing prices.
But

equipment.
looks

and of the time.

a

shake

profits can actually undermine the always thus far it has been posentire
economy
by cutting the sible to float off the higher prices
heart out of capital expenditures, on
waves
of buying attending
If we do not manage to explain postwar or
mobilization^ booms,
this situation far more effectively In fact, it has
frequently been
than we have managed thus far, possible to increase prices more

Af.

^

bilization,

What?

lieve it

not, I really have been

or

to which,

be-

addressing myself, I tried to make

wanes,
wage

much

pect of being of first-rate
portance. They are that:

tremendous

The

(1)

lm-

& McKinnon, New York City

the

so,

am

political

convinced

that

of

I

problem

preventing

the

enthusiasm

levelling

from

incentives

for

killing

income

economic

is

n0

forced

is putting under our econ-

is x likely to play out sooner
than most people seem to antici-

And

be increased by the

can

will need

be

bilities
for

of

depletion

executives

allowances

designed along

,

circumstances,

hand.

at

attempt

a

I

shall

not

WOrkers

that

exhaust

their

have

been

any

rate, there is

job ahead for

a

taught to expect in this postwar
period would result in a lot of
unemployment if we were playing

.

^

^

^

—.

.

.

.

in

resulted

important capital i.—^ ment had
goods industries) feeling the harsh winds of down.
rugged competition much sooner
j

The
**"

a

.

,

shake- executives in the
of course,

+

and

wear

tear

years

.

sales

on

logical

one

of

thes resources,

importance, will be

lot of

nomics was handled largely as a
form of abstract logic with a singularly forbidding technical lingo.
Now all that is changed. Economists have a great deal of
intensely practical value to contHh ifp

to

tribute

to

the

tne

!Solution
solution

of

oi

the

tne

have ahead.

industry,

remarkably expanding population.

A,.,

part

■

'

of our" postwar

rush to disarm.

The Price Outlook

.

at

least

look

is

economy
more

wise

say

going

to

,.

that our
be much

i

.

■

'

s

:
1

AMrvn

A.

yv

'

^

A

?1ii

:

organized workers and business— think at that.




l

r»llint

vm-

'ruuni, xmi*

„

s'^ag°' ^

T,
.

FaZu rhan
rhirl 11 r
Charles

Fampll

^Vn

1 -it

xu., c

B'Harding, Smith, Barney & Co.,
„
Henrv

Harris

'city*

York

Yo^k City';

New

B ,i McDonald

Comoanv

New

Wilson- Holden

W

Copies &"Booker,
c

TTnham

Upham & Co

McDonald

Cleveland

&

Ohio

The Nominating Committee for
1951

nrGSented

wujch

ahove

the

sjate consjst;ed 0f.
Ellgpnp

shields
jameg

&
F

New'

Burns

ham & Co
n

rhairmnn

Rarrv

Co

fitv*
TTni
Citv-'WH-

York

Harris

Tr

New York

Af_

E

ianta
w

Huttori' Jr.,
Co., Cincinnati,

Qa.; James M.

E

Hutton

&

Ohio; Philip W. Nash Nash & Co.,

'

New York Citv

Election

v"«'*
of

hel(J gt 3.15 P M
the

N

Board
y

*

will

Governors

o{

st

Nov

Governors
.

be

14j 1951 in
Room

."oom,

„

t,tock .f*®8"*6-.,-

•Nominated («• reelection.

Joins F. L. Putnam
(Special to The Financial Chronicle)

v

.

,

*'

*

vent

-

that.

I

think

it

is

quite

,

ously with Proctor, Cook & Co.

least one man will have possible, however, to have serious

moon and broads 'made on our most
returned^ safely. —C. C. Furnas, cious possession as American

pre-

Schirmer, Atherton Adds

citi-

(special to the financial chronicle)

Cornell Aeronautical Laboratories,
lnc«

personal and political
BOSTON
freedom—by having the Federal Tannebring'

For all I know, there may be
touch of Buck Rogers in these
fellows.
I suspect there is in
many first-rate creative scientists.
But, even so, I have no

extend its control with Schirmer Atherton & Co 5Q
private business manager Congress Street members of the
ment.
In fact, the only way I New York and Boston Stock Exknow of avoiding that is by hay- changes

a

J

w.

Irolling reason lor that view-it is clear, that there is a rugged job
,that/ all the major, organized po- ahead for business executives, and
Jitical pressure groups^-farmers, , not so far ahead as many seem to

,

circumnavigated^ the

•

w>

^

-V?®h

'
orH

A "1U ^W1FVA<1.

-

g

stable from here out than it

first. year

\

p^p

RflnhP

F

T

they went up during the to which I keep returning beafter the Korean war cause it is so crucially important,
started, when
wholesale prices creates an overshadowing element
rose
17% and the cost of living 0f instability.
It it is not masjumped 9%. I anticipate a «*TAl*lr
slow- tered by business management,
moving increase in prices, work- any greater stability we attain
ing out at perhaps 4% or 5% a wqi be by what I regard as the
year, with many downs along with highly undesirable route of govfhe steady f trend upward.
ernment intervention.
If i were to give, a single conI trust, that I have made it
which

T

r r'itZ

Y
Tohn

.....

.

Will prices in general keep on has jheen in the past.
They may
going up? Yes, I think they ^will. be right, but if so, it is not benot in any wild, runaway fashion; caUse
of any inherent stability.
not :even with'the speed with This fact of optional consumption,
t

N

to provide the American people
xxrith hv far thp nifhp«;t matf»rial
with by far the highest material
BOSTON, Mass.
Gordon M.
***„**&
lixrin^ in
mnru
t
"Not nnlv making rain but nre- standard of living in the world.
I Benedict is now associated with
7 1S
vfv
rai?iM5r5; doubt that anyone, no matter how
doubt
L.Putnam&■ Co., Inc.,77 FrankventinV""it 'win'bo^estabiiSied
that^anyone, no matter how
^am 02 V°'' AnS''+i![^• ^Jra^K"*
,,^^1)0 established rodigious in that line can mess ^Street, members of the Boston
' things up badly enough to pre- Stock Exchange. He was previ-

Jj^CAeu

as

.

?

in 1952:
*Harold

General AniUne & Film Corpora-

about half—say $35 greater efficiency, and (2> gxcdi.
great
opposed to nearly-$70 competence on the part of sales
billion—of the peak we are sched- management.
uled to hit in overcoming the folly
i keep hearing economists who
"than

more

Until Annual Meeting of Members

Harris

Another very important solvent

.

billion

til Annual Meeting of Member si

of no

a

When many of you went

ahead will, problem you

in

&

TT„+.,

scarcely perceptible. Eco-

was

be sustained, if not in-

revolution

Drexel

Jr.,

"Henry I. Cobb, Jr., DeCoppet
& Doremus, New York City
relatively reliable knowledge of
Edward H. Hilliard, J. J. B.
how this economy of ours actually Hilliard & Son, Louisville, Ky.

But

Assured

-

Starr,

Boswortb,
Sullivan & Co., Denver, Colo.

even

f eased by the continuing techno- of your problems should be our

Em„iovment Political,y

*ul1 ^mpioymenr roiuicai y

the

Scott &

comprehensive catalog,

When the American Chemical So- At a time when most people who
Under the new dispensation, ciety recently celebrated its 75th called themselves population exhowever, I do not believe that the anniversary it presented a collec- perts thought that the increase
shakedown process would be tol- tion of forecasts of the shape of in our population was about to
erated. I think that there would things to come prepared by vari- play out, forces generated by
be effective political insistence ous of its members. Here are just World War II touched off a boom
dominant fact about the American that the government adopt poll- a few 0f them, as presented in in babies of which no need seems
economy.
cies designed to maintain full Chemical and Engineering News to be in sight.
There is, of
Now—always with Aristotle in employment. Whether they would (for Aug. 13> 195i);
course, no fixed and immutable
mind—I shall turn to what I an- work or not is^ problematical.
In
«iron obtained from earth's core relation between more people and
ticipate will be some other domi- any event, r think the end result wiB require no furnace treatment, more prosperity.
In India, more
nant characteristics of the period would be highly undesirable. But, atomic bombardment will yield people seems to add up to more
after the present defense build-up I dont believe that fact would §famiess
steels
of
any
desired hungry and wretched people. But
iv,
n/Mifitrtr +Ko
is concluded.
Perhaps, in this check the process or prevent it composition and nickel, cobalt, thus far in our country the higher
connection, I should emphasize from
pumping
enough money yapadium, chromium."—John C. birth rate has ended up by meanthe fact that I do. not have in mind around the economy to sustain a Bailar, University of Illinois.
ing expanded markets. I see no
a defense build-up which will be trend of price inflation.
"Bacteria and viruses will not reason why this general relationchopped off abruptly, with everyIf the inflationary process is to
and viruses: .vrtfl ishjp going to
during the
one
going back to business as be kept within tolerable limits it D® imporiant causes_ 01 mortal
period ahead.
usual/ I assume that we are going will be
a^
the degenerative diseases such as
Over this period, I have no misto be carrying a heavy load in
£);Sreatcom^tence^on the
cancerj arteriosclerosis, arthritis givings about have enough prodefense expenditures for years, of industrial management in off- w-j, ^ unravejed_n
h B
Hass, duced and distributed to continue
(3) In

Edward

an-

-

post - mobilization
period, the ability of the American
consuming public to postpone perhaps as much as 40% of its consumption without any immediate
personal inconvenience will be a

of

natural resources in meeting the the study of economics and what
increases in the magni- market demands upon them.
At actually went on in the world

such

nual wage

than some others.

lot

a

relatively new resources
available to help solve the probor

Robertson,

Co., Philadelphia
John
J.
Sullivan,

to college the connection between

—i

.

there will be

that

new

works.

which

m,

.

fact

companies

(notably the all- would not move until unemploy-

however, I also should stress the

S.

Richmond', Va.
Frederick'c. Rogers,'Thomson

up,

lines similar to the allowances for

„„„„„„

industries

some

balanced

hurry at all to buy a very

<

in

things

keep

share of what is produced,

business executives which will
put an exhausting strain on both
pate.
"
•.
their physical and intellectual reV (2) As the boom itself has been under the old rules.
Consumers sources—a fact of which only a
-ery uneven, so the playing out simply
would not pay the in- wildly improvident nation will
lnsiP aiaht
process will also be uneven, with creased prices and the goods lose sight,
omy

To

mean

Under

tude

ft has already become in Brit-

ain

'"Walter

.

procedure to look into the possi-

consumers

large

draft which the mobilization program

develop in the process of readjustment. } :
.<
';

Even

the

difficult.

.

Stringfellow,

lems

more

~

altogether unique in this regard,

where the levelling process
has been carried much further,
Perhaps it would be a constructive

difficulty
in

boom

t

i
?
•
Meehan & Co.,.New York City,
* James Parker Nolan, Folger,
Nolan & Co., Washington, D. C.

the art of passing along
increases is going to get

points, all of which I sus-

three

mobilization

**

gressively removed and all sorts
of bumps and bulges are sure to

as
this

As

After -Mo-

u

supports or controls of one kind
and another.
Let those be pro-

great deal to learn about how
incentives actually work,
And I do not believe that I am

going to become a
hey problem in the years ahead,

*

the question of

i!
Meehan>

m

money

a

costs.

Tvrnhiifaafinn?

After Mob

_

that I have it have been shaped by artificial

me

than necessary to meet increased

I think it well may.

On

convinces

nomena

_

i.

.

1

1

...jll

doubt that technical changes will
keep large parts of our economy
churned up for large parts of the
time.
The great outlays being
made by industry for organized
,

research almost inevitably have
that result. They also have and
are likely to continue.to have, the
This observation, result of making successful sur.

zens—our

Mass
has

—

Robert

become

<3

affiliated

Government

over

ing private business management
■
do its work so well that the probWith Waddell & Reed
lems I have touched on, arid
(Special to The Financial Chronicle)
pre-eminently t he problem of
MINNEAPOLIS, Mihn.-^Dortald
economic stability, will be handled
to the satisfaction of a safe major- L. Lyle has become associated
.1

-

i

A

—

.

.11

ll.

_

X

11.

_

J

<

-

ity of the electorate. Perhaps I
have said something which will
help in this direction. I hope so,
because I regard the perpetuation

with Waddell & Reed, Inc., of
Kansas City. He was formerly
with the Northwestern National
Bank of Minneapolis.

34

The Commercial and Financial Chronicle

(1774)

be

Tomorrow's

diametrically

Whyte

an

reason

up

down

The

istence of this column.

for the recent

and down

Why anybody would

they're ancient

At best

stand.

history and even assuming
that history repeats itself the
results for investors and trad¬
ers are

seldom satisfactory.
❖

❖

*

Industrial
about 120%

Jones

Dow

selling

was

the

the

ratio

1937

would

ages

book

to

value,

Industrial

Jones

have

to

aver¬

Not

be

been

it

but

years

in

moderate

rela¬

inflation¬

the tremendous

to

sponsible for any decline.
They merely accelerate it..

stocks that

some

will go

under this base. But
majority will: either go
a dullness or will slowly

income

sonal

of

of

running at the

was

billion,

$224

increase

an

216%, whereas the Dow Jones
have risen since 1937 by

averages

From

think

trading viewpoint I

a

leaders

the

and

some

long to

how

to

as

What stops are
should be placed

just underneath the lows of
last week. These stops to be

Pacific Coast

Securities

shellacking. Of

a

recommend

don't

I

[The

expressed

views

in this

Exchange
New York Curb Exchange (Associate)
San Francisco Stock Exchange
Chicago Board of Trade
Exchange

New York Cotton

New York S, N. Y.

do

They are presented as

Chronicle.

only.i

those of the mth0r

member

billion,

$50.5

If stocks

lation
the
the

banks

about

up

or

stood

at

240%

the 1937 total of $14.8 billion.

over

were

ratio

same

as

would be selling at
to currency in

averages

relation

In

660.

priced today in re¬
in
at the 1937 peak,

demand deposits

the

to

circulation

too,

rise in

the

stock

In 1937 the Bureau of La¬

erty?

Up until August, 1951, the

San Francisco—Santa

Barbara

Ohio — Merrill,
Co., Union Commerce

CLEVELAND,
&

Turben

members of
Exchange,

Building,

Stock

Lewis

that

President

announce

Williams

C.

and

Mid¬

the
is

now

Mr.

Director.

was

formerly Vice-Pres¬

ident

the

National

$1,150.00

487.50

7 225.00
7

237.50

2

325.00
575.00

28

26

487.50
425.00

(Special

Chronicle)

the New York and Detroit

Stock

Exchanges.

2

425.00

31

325.00

3

200.D0

a

this

in

Position to Profit
Uncertain

if 2 300.00

Subject to prior sale or price change
request

Market

1001 CHARTS
in

NEW

NOVEMBER

-ISSUE

of GRAPHIC STOCKS
show monthly highs, lows—earnings—
^dividends, capitalizations — volume, on
'virtually every active stock listed on
N.

Y.

1940

Stock

to

and

November

Curb

1,

Exchanges from

1951.

THOMAS, HAAB & BOTTS

Single Copy (Spiral Bound). $10410

Members Put & Calls Brokers & Dealers

Yearly (6 Revised Books) .$50.00

Association, Inc.

50 Broadway, N. Y. 4,




TeL BO 9-8470

increase
The Dow Jones Indus¬
this year,

of

an

The rise in the value of farm

outrun the ad¬

way

in common stocks.

The De¬

of Agriculture's index
of farm lands has risen from 102

partment

to 265 as of

very rapid
few
years, f

whereas

reflecting
the

total

not-look

does

stocks

are

if

as

common

inflated.

It

seems

been

to

three

that there have

me

to $1,973,000,000

open-end

of

assets

companies reached the

gigantic size of $3,045,000,000 in¬
dicating sales of $480 million for
the

months

nine

first

These figures are

of

1951.

based on statis¬

tics for 98 of the open-end funds.

However, as I understand it, I am
not here to tell you whether the
is

market
am

here

which

going up or
primarily to

groups

down. I
tell you

securities, and

of

possibly which issues in my opin¬
ion may be relatively attractive
for investment for the next sev¬
eral months.

-originally ushered in, .inso¬
far as the United States" is con¬
was

so

cline,

major

was

very

showing a der
significant and illus¬

trative development. Next we have
the

investrhent public

turning to

so-called growth stocks.

I say so-

called growth stocks,because many
stocks

are

now

being

touted

as

.growth stocks by yarious institu¬

be
With

cannot

group.

earn¬

even

after

allowing for higher taxes,,
were not only above those for the
second quarter of this year but
also
ahead
of
last
year.
The
Iranian situation has something to
do with the future outlook but so

far

as

our

picture

own

cerned, it looks to

me

is con¬
if stocks

as

of crude oil

and refined products
substantially above a year ago
but, in relation to demand, they
are

do not appear excessive.

Gasoline;

stocks, for example, represent 35
days' supply as against 40 days a
year

and heating oils

ago,

relatively
whether

period
of

will

depend

conditions

ahead.

A

upon

the

over

substantial

part
build-up in stocks of such

the

oils
to

in

supply
but
not they are excessive

or

weather

are

greater

naturally

the East Coast is attributed

on

the

possibility of

lifting of

a

ceiling prices due to the advance
in tanker rates. With stocks close
to major
consuming areas, sup¬
pliers

therefore appear to be in
good position to take advantage of
any increase in prices that may
Not

occur.

to

be

overlooked

ill

measuring prospective demand fox
heating oil is the improved com-,
petitive

position of the fuel re¬
sulting from the recent increases
in

hard

and soft coal prices;

;

Therefore, despite the sharp rise
which the petroleum
industry has
had

marketwise

in

although,

years,

last two

or

the

last .two

I said,*before,

as

it has been soft

somewhat in the

three weeks, I believe

that it is still

of the outstand¬

one

ing growth industries in; which
the average investor should have
representation.

levels, I

of

am

the

At present
opinion that
South Penn

Anderson-Prichard,
•pil, Sinclair and Pure

Oil

-

are

outstandingly attractive.

has

from

material in Mesapotamia,

celebrated
to

the

found

into

spring

this

level.

j

spring
natives
gathering

coiling them

cestors

employed
in

400

by

B.. C.

their

an¬

Petroleum

by our forces against the Japanese
World War II was not a "new

in

development but rather .'the adap¬
of an ancient method of

tation

warfare. The Greeks' .fire, a

of

petroleum

naphtha

mix¬

and

quicklime, which ignites on con¬
tact
with
the
water,
was
de¬

it is

1,500,000

aeries

drilling

some¬

now

the

6,000

to 7,000 foot

If Pure Oil brings oil to the

such as
surface
of
Hit.
ds now
in 1931

lumps in precisely the same

manner

ture

estimated

an

petroleum

over

well known
a

oil

the

in

This pitch, of course,
and where
asphalt collected
where at
the abundant springs of this

with pitch."

changes

investing

reasoning

to

In my
opinion, Pure Oil Co. is
cerned, in 1859, with a 69 % foot
doing an outstanding job. It has
deep well in Titusville, Pa., with
title to extremely large reserves oi
an initial production of 25 barrels
oil and natural gas in the
ground,
a
day. If you read Chapter VI of
not only in the Gulf of Mexico
Genesis, you will find that God
but also in the now
potentially
commanded Noah to build an Ark
famous Williston Basin, where it
and "pitch it within and without

with asphalt was used in the daily life
recent of the people of Mesapotamia
years. One has been the injection
thousands of years ago.
It was
of pension fund and trustee buy¬
then used as a mortar for the con¬
ing of common stocks. The of feet struction of the temples, palaces
of this development has been to and walls of the
yarious cities,
emphasize .the quality stocks and and important roads and streets
to push its price rather strongly
were paved with asphalt even as
as
against the medium
grade they: are today. The Egyptians
stocks.
I think if you made a used
petroleum asphalt for many
study of the advance in insurance purposes including the fabrication
company
shares for 1950, you of
waterproof
containers.
The
would find that about 10 or 12 of
shipbuilding industry used it also.
the leaders would show the price The use of flame throwers by
advance as against 20 to 30 of the
■the Germans in World War I and
to

the

of

few exceptions, their
the third quarter,

a

some

Despite the enthusiasm that is
current in the oil industry,- this is
not a new industry, although it

snakes of asphalt and

Three Major Investing Changes

this

the year of
As of Sept. 30, 1951,

net

investment

Visitors

it

1949

for

sales

$518,000,000.

the

Consequently,

picture.

of

end

reflecting sales for the year at
$385 million.
In the year 1950,
net assets totaled
$2,530,000,000,

the

same

the

at

figure amounted

June, 1951, an advance
of 160%, and the Dow Jones In¬
dustrial averages would have to
rise to 507 in order to complete

not

OVER

237.50

6

Be in

...

on

to The Financial

DETROIT, Mich. — John E.
Farley is now with Wm. C. Roney
& Co., Buhl Building, members of

400.00

3
2

Building costs
to 403 as of

197

in order to continue the same ra¬

respect

Joins Win. C. Roney

Schenley Ind..@33Vz Dec. 31 225.00
Chrysler
.@68
6 mos. 487.50
Kern Co. Land@48% 6 mos.
750.00
Sinclair Oil., .@41% 6 mos.
287J50
Explanatory pamphlet

City Bank

of Cleveland.

Dec. 31

Steel...@40%Jan.
Armed Steel,.@39
Jan.
/So. Pacific,.. @60
Jan.
Kansas City So,@64% Jan.
So. Railway,,@52
Dec.
Am. Cyanam.@108
Jan.
U. S. Rubber.@71V2 Feb.
New Mex. Ariz.@24% Jan.
Richfield Oil..@57
Dec.
Warren Petro!.@28V2 Jan.
B. & 0
@19
Feb.
Homestk. Mng.@36/4 Feb.
U. S.

of

OPTIONS

Per 100 Shares

Dow Chem.. .@107 Jan 25

from

Vice-

as

Williams

Cities Service@106

October

tio.

Of Merrill Tarbsn

associated with their firm

Fresno—Santa Rosa

PUT

risen

vance

west

Monterey—Oakland—Sacramento

index stood

bor's Commodity price

property has

lewis Williams Y.-P.

open-

rate during the last
the market advance has also been
Net total assets of
extremely moderate. Last month open-end investment trusts as of
demand deposits of the Federal the
year 1940 totaled $447 million

not

Teletype NY 1-928

Private Wires to Principal Offices

1952.

of in¬

have been increasing at

necessarily» at any of 106%.
coincide with those of the trial averages would stand at 400

article

SECURITIES

Stock

account

a

have to rise to 400.

Established 4819

Members

the

for

end type

buying stocks on strong days. index had risen to
178, an increase
Competing for them is one of 106%. Again using the same
endeavor I leave to somebody relationship, the averages would

time

(in
uo*

exceeded in the year

be

population's liquid resources,

have

rJ

to

Purchases

standpoint of the increase in

.v

else.

ocnwaDacner oc

and that this

1951

companies of the

a

Orders Executed on
Pacific Coast Exchanges

$300 million in the year
figure is likely

of $200 to

vestment

at 86.3.

SPECIAL

have

that

dollars

of

From

32%.

of

amount

advanced each

course

COrtlandt 7-4150

lots.

any accurate estimate as to
the number of shares or amounts
you

small

Reserve

buy at pres¬
with mental res¬

are a

used I think

taking

14 Wall Street

the in¬
purchases
It is difficult to give
by

the

start to inch up.

>

York

indicated

as

in the number of

the

day by a frac¬ prices has been moderate. Back
in 1937 there were $6,6 billion of
full point depending
currency in circulation while this
Vy The market letters are now
on
the action of individual figure last month stood at $28.5
full of statements pointing to
stocks.
billion, an increase of about 315%.
various points in the averages
*
*
*
;:
The averages would stand at 800
as stopping points against ad¬
Such procedure won't guar¬ today were it selling at the same
ratio to currency in circulation as
ditional declines, and equally
antee you against loss. But it
prevailed at the 1937 market top.,
impressive arguments stating will at least
keep you from
How about other forms of prop¬
still other points which will

New

he has come into the

even

crease

the

into

tion to

INVESTMENT

Accord¬

street.

one-way

gone into
rise in other segments of our pension fund purchases but it is
economy.
In 1937, income to in¬ my opinion that purchases for pen¬
dividuals equaled $71 billion but sion fund accounts have been
as of August, 1951, disposable per¬
somewhere in the neighborhood
rate

ervations

viously such stops are not re¬

levels.

base around current

a

orders that were
keep them.
off like fire crackers. Ob¬

series of stop

tvarn<>f

a

This

the man > applied

public

of

earnings in pros¬
result of the increase in

as a

ings

come

investing

level

taxes.

only

of odd

recent

over

in¬

the street of the thesis of in¬

on

to the substantial increase in book

also

an

flation this year and this has be¬

market

values

the

lower

pect

only has the advance in stock
prices today been small in relation

has

Corning

Thirdly, there has been

425. ingly,

rise to

<

like

situations

If creasing acceptance by

above.

stocks today were to sell

Dow

special
Glass.

value while today

its book

only around 32%

tion

made

I think the market has

specialties
One of the basic causes (not
ent prices
reasons) of the break were a
set

no

So here goes.

convictions.

interested I can't under¬ the

so

the setback in the general market
was due to the belated recognition

ary

decline still rage up
est fires.

is

at

Actually I have

the financial districts like for¬ There'll

be

average

above
it

*

*

high

common

during the
again at the

complete collapse.
reasons

Market commentators have been

by
1937

Group Attractive

emphasizing that the reason for.

Should You

I too will have to
opinion if for no other
than to justify the ex¬

of hand

means

j

Oil

In Which Industries

t'fi

i'fi

firm con¬
weekend,
giving holders a victions one way or another.
nervous holiday.
My guess is I can see some stocks going
that there will be more nerv¬ down; others going up. I can
ous
days ahead; days that will also see a picture that can
drive the recent buyers into whipsaw anybody with firm
*

being squirted by

3

I suppose

give

==By WALTER WHYTE=

almost

page

ions.

Says—
They went

from

Thursday, November 8, 1951

..

syringes.

each giving
opposite opin¬

Jj{

Walter

Continued

ad¬

further

to

I have two such state¬

ments before me,

Markets

week and

barriers

vances.

.

at around

hoped,

9,000 feet,

such

it

as

discovery

a

could add millions and millions of

barrels to Pure Oil's
company has

reserves.

nancing

since

progress

has

1937.

been

-Sinclair's
remarkable

lately.

It has been extremely

cessful

in

coveries

The

done no outside fi¬

sue*

making important dis¬

from

time

time

to

and

currently it is doing some new ex±
ploratory drilling in Colorado and

Wyoming from which interesting
developments can be expected.
*
The importance of oil as a basic
<

material for the chemical ini

raw

dustry has been growing steadily.
About

25 %l

produced

of

in

present time
their

are

the

chemicals

country

at the
estimated to have

roots

in our petroleum re¬
Petrochemicals -derived

sources. 7

-from

all

this

the

-

almost

inexhaustible

supplies of petroleum and natural
gas are the bellwether Of
thq^ex-

panding chemical industry. Two
major developments in petroleum
-Chemistry have been- responsible
-for

the

utilization

hydrocarbons
terial

for

the

as

a

of

petroleum

basic

raw

production of

ma¬

syn¬

veloped^ in very early times and thetic
tions but are really not growth is¬
organic chemicals. The first
proved to be the most potent mili¬ -was the
development of more, .ef¬
sues
at alL
This, however, has tary weapon before the invention
ficient methods of
fractional dis-^
been an important item in the of gunpowder. It was then pack¬
.

.

F. W. STEPHENS
15 William St.. tt. Y. 5

HA 24848

filiation and

advance

of

the

chemicals,

pharmaceuticals and

many

the

aged in pottery vessels and was

certain. used

as

hand grenades, as -well as

the

development

of

processes

such

second

special
as

was

the

refining

thermal

and

Volume 174

Number 5062

.

The Commercial and

,

.

Financial Chronicle

(1775)

catalytic cracking, hydrogenation,
polymerization, etc. The by-products from these new

refinery

oper-

Titanium Outlook
As

chemical

a

be

nev/s, but as a new
industry it promises to
as
spectacular as alu-

metal for

butapes,
matics

for

the basic

are

materials

raw

the

production
of
today's
petrochemicals. There has
been
80%

an

overall

duction

increase

in

pro-

.eventually

isn't

tanium

ations such

as ethylene, propylene,
tuloene and other aro-

Bright

material, ti-

raw

almost

minum

stainless

or

steel.

Last

demand for
textile fibres,

synthetic
to

permanent

and

the

the

new

the shift
anti-freezes

type

tremendous

for

demand

plastics.
of

5Oif Uon

Refining, and Rohm Tauatlanic
& Haas. In,

vestment
These is

field

far

such,r

investment in

an

chemical
will

companies

in

which

petro-

a

expect

we

out-distance

as

the

rate

of

Today textiles provide the largest
imarket for petrochemicals and the
rfpvplnrnnpnt

nf

development

ot

to be

seems

"npw ernwih

cVntinotir.

synthetic

fibres

just at the start of
n^rinri

S

fibres and nithnnVh

the

a

orVfom5i

w0

S

iar

wp

fiberlLss

'dacron

ha

1 rU

h

of^ dvneVnrlnn Lrhan

name,

inVi
and

vicara

importance will

in

progress

assuming

50%

a

These dollar

an

projected

a

tons

there

by

of

rate

annual

better

or

late

will

be

5,000

from

vary

1952.

I

im-

many

officially projected.
.

There

panies

are large and small
identified' with this

comnew

S

narrow^ down to Alle-

t

gheny Ludlum, Kennecott Copper,
Zinc, National Lead,

radioactive

materials

talkin?^ho^t

allv

that

be produced

can

initial high
nnnnH

successful

a

even at tne

of $7

price

IpvpI

whiph

For

one.

ingot

per

nrnhaMv

in
pound, a le^ei wnicn probaoiy ina

volves large

losses

initial

Tf

nroHnrPrs

mstc

the

to

hp

ran

nit

in

order to brina them dloser in line
with the costs of nroducins stain

tess

an^

steel

titanium

find

may

a

wide range of

Plications

as

a

high frequency outlets

frequent

Incident

ElectHc

hich

Bn»t

Motion

Picture
In

,•

the

com-

s

ocks of

^®e"lg
8

l-i,

of'at

ld

treTeadTnrmotion

g

™

ransiderations

considerations
problems,

serious

aDPear

high

166

end

of

lit?1', P^fmularly mThose
'fitil
field

?
and

.we

which

a°
VPriurtion

yet

♦>?-eqUiate.rec°gn]ition as a
this new interest. I think

Result of

P

compa-

3.ust entered thls
have not as

,

?? tbe1^art,of AJil.ed-Chemical in
d

chemicals

f

+organi^c
to
produce plastics and fibres. Amer-

>

canacilv

commercial
nav

of

nlane

'

virtnallv

could

nrrvine

ncnai

expect greater emphasis

may

,

tran<?_Atlantic

20-7

load is

In

a

i

r-

littip

a

.

nf

wpi^ht

take-nff

0

annlicafion

<?o

20<7

a

™Mor ™.sg awlication^. 20%

^rrvW canabRv several
;®ad COTjrng capaelty several
its entry as a producer of a
j tors in world
Kennecotf
synthetic fibre.
,torsin
wprldropp^r,Kern^n,
'
I Tn^nf Li drnnapl ff
Commercial, Solvents

ican

Cyanamid

may soon announce
new

conner

-

i

«

The

chemical-drug

dynamic

so

difficult

companies

drug

field

seems

to be

in

about

a

an

is

to

keep

up

the

growing

which

Solvents.

°e

^ L^lonment

agricultural

chemicals.

gold

iho

nf

AfHrln
^fJ1^^ld^ines' onlhii T?nn
j?
rSS
S:AJ
fiiflw >^
aH-h;

:c

SoSStRSAKSs:
■its

field

come

has

fermentation

that

interest

it

to-

Furthermore, this

recently

company

announced

a

new

form of penicillin which, we believe, is patentable and it seems
[

likey that they
a

march

ducers,

on

are

about to steal

the other major pro-

since

this

form

new

penicillin is said to be

one

of

which

is also a major factor in the pro-

h output, should start, from
an°ther large zinc mine now un^

market,

'

set

one

well place

very

Commercial Solvents in
.

a

Cyanamid, and Parke Davis as a
producer of a specialty product.
Through their knowledge of fer•mentation
has

been

methods, the company
extremely active in the

search for
tute
tute.

a

blood plasma substi-

Thev nave succeeded in pro
iney have succeeded in uro-

ducing the plasma substitute, dextran, which they call "Expandex."
It

seems

is

on

,

-

its way to

Ai.

,

long-term growth

pharmaceuticals through peni-

cillin

thetic

and

fertilizers and

in

fibers

through

a

x

syn-

doubling
,

of

doitJg makes them outstand-

ingly attractive also,

(

Many of us may wonder
whether the release of atomic en-

as

Furthermore

for ob-

allowing

rurinermore, anowing ior oo

solescence ot

some of the
it is not difficult for

present

sets

*

able

materials

on

productive

capacity

their

of

a

low^cost ammonia plants.




j

-

-

industrial uses.
However, it
is possible to categorize the indus-

not only this, disposable income
and savings are relatively high

and demand for entertainment is
undiminished and is being spurred
by

on

larger

a

movie

number .of

patrons.

po-

the

All

motion picture companies have
a large Potential value in connection with their huge film libraries
which"

are

presently

carried

at

tronics fieid are Philco Motorola,
Zenith and, of course, Radio Corporation of America.
TT......

Inivi^pn^

.

Utilities to Increase Dividends

nominal values. If these fully dePreciated films should eventually
be released for telecasting, the industry would be provided with a and West Penn Electric,
very substantial source of new dividend increases can be

some

looked

m®unt

pktures

hasfcbeen

active

these lines and is underto be making considerable

headway in this direction. At this
there is some skepticism as

^me

although we have
'his country some ,13,600,000

companies and
ln

which

cars,

generally

are

con-

sidered to be new, that is, not
over three years of age there are
about 26 million cars that exceed
the three-year limitation and, of

imp0rtant revenue producer. With
home phonevision, television re-

the number of new cars on the
road now appear to be in fairly

ceivers WOuld be equipped with a
speciai device whereby viewers

good balance. However, it is my
opinion, that towards the latter
part of 1952, we may again come
into a sellers' market in cars and
that somewhere along the line, we
should begin to look for new buy-

coujd receive televised films for

a

stipulated
fee.
Whether
it
is
phonevision, or some other type
of vision, I feel pretty sure that
eventually the television industry

leading motion picture comI feel that Paramount,

panies.

are

W6" W°r'h PreSent priceS...

The

television 'industry

but

that atomic

ions

no

fuel .will

n

.,

_

part
.

of
>

1952
.

us

omit the

not

the

company,

eom-

greatest

wheat speculator the President of
the New York Stock Exchange, a
member of the President's Cabinet,

for years
^

h

Settlements

and

the

newspapers and maga-

d .

nrintin? thpir

cnr

naa Deen printing tneir suestories and urging the youth
nation

to

follow

thpir

pv

OI "je nation to lonow their ex
amples. Now let us see what

these

men 25 yeai

later. The President of the larges
steel company, Charles SchwaL

so he could die at home. The
greatest bear in Wall Street, Jessie Livermore, committed suicide.
The President of the Bank o'
International Settlements, Lec .V
Frazer, committed suicide and tl -

head

of

the

world,g

Mon dollarg could do
willi

te.

t

g

k

;

., .

hard

Diari

JS
progXs"vel?mJre di
cult°XnShe past two dec^d|

.

part to

tremendot

our

"^ing in part to

ouyreme^ou

«x burdens and controls There
aeems^ttle hope of any relief on
educatjng purseives
Amerjcans

romjnff

encroarhmint

„

id

cnon^nrpH

nd

.

r

ainnp

that

nf
?

nr

ham™*

dpstrnv.

niir

fril-

-

...
.

€".

ti

'

,

s

.

d b^

°

..

1 5S
,cover ai}

Ampri_QJ 1°r^ina^1 concept of

^

can system,

Jackson Co. Adds
(special to th* financial chr^-icu:)
RrysTrw

current

in

rep^rted ear"ingf ?£
a
share,

price,

and

about its

or

its

earnings
$5.00

this year should approximate

which the

but

oftte

the President of the largest
utility

Studebaker, which during the last three
$29

itself

let

potentialities

profit

y?ars. !?as
about

..

Television Shares Attractive
,

favorites

for the early

doubt

steef

ing opportunities in the automo-

cult

d

President

**** independent

,

a^?d JdiItCto'V

have

Chirac

I can't help but feel that the monopoly,. Ivar Kreuger con"
utility companies for the most mitted suicidet A11 of these m(
part are quite attractive from a had learned how to make mon
yield point of view. However, but not one of them had learn,
utility companies are not attrac- how to live.
:
•
tive for any substantial price apThere wag a time when QU preciation, except in the case men and women in America co Iwhere from time to lime dividends shape their own destinies. Succare being increased. I would sus- in business or anything else <
pect that in the case of Delaware pended upon individual initiat'-'■
Power & Light, Central Hudson Anyone with enougb »gef up
Gas
Electric, Niagara Mohawk
t„ whQ wanted t
m^k p '

per

I

^

Ed7e-

the

in

vent. The President of the Ne\
York Stock Exchange, Richar.
Whitney, had served a term i.
Sing Sing prison. The member o
the President's Cabinet, Albert
Fall, was pardoned from prison

find the going rather diffi-

OvXrers*

at

Hotel

electronic tube and RCA's tricolor tube, makes me believe that
the future of television will be
greatly stimulated by color. Its
impact far exceeds that of black
and white and it should make
powerful appeal to the consumer's
dollar. My favorites in the elec-

may

tiido

met

Eeach

bas been mighty poor. Also, taking tbe seasonal factor into consideration, it is logical to anticipate tbat earnings of the motion
Picture, units in the last several
uionths of the year and early next
year should make favorable comParisons with those of the last two
Qr three years
Perhaps the
novelty of television is wearing
^ which ig contributing to the
favorable attendance records but

tries which seem to be best situ-

consideration,

,

.

succe^s-

hved on borrowed money the las,
five years of his life and die
broke. The utility operator, Sam
uel Insull, died virtually in exile
The greatest wheat speculato:
Arthur Patton, died abroad insol

ture

range

f, £nanciers

to

,qno

tant constructive step in my opin-

good portion of the information 20th Century-Fox and Loew's
to the difficulty of estimating fu-

sooner

would* like

I

;tor7HIn

lim

duction of color sets is an impor-

the

fissionable

°

£OUp of ?he worlds Lst

anyone

erg7 ma7 no} be a far~reaching may utilize the many films that bile stocks. General Motors and
*
p+rofou?d development. The are available in the archives of Chrysler are, of course, the two
need to restrict the use of avail-

to me that the company
,

in

tion Copper and American Zinc
are

Along this line
teU

head of the world's greatest
against 15 million that monopoly. Collectively, these ty-

Freudens- tp whether phonevision, which is this number, over 16 million are
ville. Pa. and its recently devel- undergoing a limited 90-day test, 10 years old, or more. The number
®ped sterling process is expected wqj ultimately prove to be an of so-called new car buyers and

Jbat tbe wofk Anaconda, Inspira-

m^y

tick-tack-toe proposition

potential 32 million set

d^ development at

position

This

a

sur

it is not

apPears to be Picking up in the ma-

fdhuctI1?ntai,i/fflni«g
"J along
"^United States. By the end of st0J

similar to that of Pfizer, American

effect.

constant

Attendance at the box office

a

to permit reduction in zinc refming costs and may well be a
f?urc.l
ro^Ia
income. I think

be given without any allergic

may

and

wib, ii is nui uuxicuii iui anyunc
to estimate an annual average
market of at least 5 million sets
over the next several years. The
recent decision to limit the pro-

by the way,
0f the television art.
one-third interest m the Namely the filming or kinescoppeni- Quebec lion & Titanium Co. and jng 0j television programs. Parabe-J.has

to

major producer of

a

cillin.

of

topic which reauires

a

studv

jszasstsfjus,"««»»!«- sas,a!aas,«i,F
studied by all of the automobile

■■

New Jersey Zinc

knowledge and experience in

the

is

constant

wuuju appear tnai ^interest to
wards this negelected group may
be activated by the belief that an
improvement in earnings may be
feeen in the forthcoming months,

tential

of W

proDenTerwhLh ^
Wnof ^5!
proL?^onTla?2rsSle
fho»
fSfL JL
cS

Afr?can

During

past three or four years, this
company has been swinging sharprly into the field of pharmaceutiand

nanced of all
companies fn the
^etaitraL Ke^o?t^ '"idto

there

the

cals

ai

increasing interest

'Commercial

-is.

industry

developments.. Among

new

the

hn

'

character that it is

in

extremely
with

*

ket> It

ternational

station

now

2n<7

Don't forget that

are cycles and occasionally
wide price movements in the mar-

indi-

least

at

own

television

im

t

such

the greatest bear in Wall Street,
the President of the Bank of In-

one

a

\

time

on

these

least

rinrtiAn#ff thpep^1 commercial promaterial
It offers
Jority of the key cities due largely ion. While there may be certain
is iusf hpfyimdrfcr
, challenge to the military to better Quality of product and technical
problems yet to be
rnPndL^ frnP
1S *
and
commercial
aircraft
fields 1 think that we are al1 in a§ree~ worked out, the quality of color
? JhT f°J comPanies. m '.Ms
weight savings
to
ment that the quality of the prod- pictures which I have seen, such
tpctmpn+? fSlL
»
S ,
loads
uct during the last several years as Paramount Pictures' simple all
.vestment interest dvocate an in- P
an
some
of
®
t

all

we

there

ultra

the

discussion

a

serious topic

a

as

'much

know, there is not too
available for

only

you

because

Possibly nine out of ten of

Gaining

Favor

long-term

stlil Present

very

and
Bv

far, I have given

will

Stocks

cati

tions

stations

freouericies

So

the highlights

new' veillance of all portfolios

1955, he believes 35^000 American families, out of an estimated
44,500,000 could be within range

de-

manufacture of airplanes.
v

and Ferro Corp., if its
in
Horizons
Titanium

to be

proves

that there will be at least 140

Pg«=^3 position to supply spe- ™f0VXirwni0L

New Jersey

du Pont
interest

by the middle of 1952. With good

com-

pany

atomic power plant. In addition pared with 108 now in operation
to such larSe companies, General and at least 136 ultra high freElectric, Westinghouse Un ion quency outlets. By the end of
£arblde and du Pont Monsanto five years Dr Baker the ViceChemical, Dow Chemical and East- President in charge of electronics
man Kodak, there are many com- at General Electric Co has esti-

°phmTnsep^rA,Sh€l1
believe that the its^ajor jlcorne Is probably
^
sa^es|F mvestme^ts m tbls *1(rld rived for the present from

OM

^tnViHnrri

submarine shows that

very

the total
million and

year,

major companies provements which may spell an
vitally interested in and depend- eventual output exceeding many
ent upon future growth in these times over the highest output yet
are duPont, Union
Carbide,
Dow, Monsanto, American Cyanamid,
Celanese,
Cities
Service,

reduc-

making headway with the aircraft

This

the

fields

further

cause

estimated 500 tons in 1951 and

to

pound.

per

think

Some

may

price reduction.
figures reflect physical output of only 60 tons last year,

amounted

of

increasing

which

to company, military business should account for roughly
one-quarter to one-third of sales
for certain of the electronics producers. With the eventual lifting
of the station freeze many new
outlets for broadcasting will be
opened and it has been estimated

metal production
only $840,000 at $7

past five

ides and -ethylene glycols.
Such
growth has been the result of the

substantial

a

reduction in the cost of electric tions in civilian production. How- plants and a strong working capipower.
The
recent contract ever, military business will be a tal position of around $23-$24 per
awarded to Electric Boat Com- factor of increasing importance share, this 100 year old company
Pany to build an atomic powered next year and while its relative looks to be fairly priced
'

the power plant for the submarine
has been substantial, although
costs are sti11 Probably prohibitive from a commercial standpoint. The Air-Force contract just
awarded to Consolidated Vultee
Aircraft to develop an airplane to
be Propelled by a nuclear reactor
suggests that General Electric is

titanium

year,

petrochemicals during may approximate $7
years with greatest by 1952 the annual rate of producgrowth in the field of vinyl chlor- tion may exceed $30 million, even
the

permit

35

.

share.
*

'»■

The

company
«

orders

defense

has to produce
■

■

>«««

Milk

Ma«

ru

i

hnFwnrnl' accS?fn
^
^
Street.
y'
'
•

,

•

t

*

<
<

■

0

Joins Glbbs & Coe
(Special to the financial chronhze)

WORCESTER, Mass.
*ili-

*

*

—

George
.

because of the shortage of raw jet engines should begin to click W. Gibbs, Jr. is now with Gibb:
materials and "component parts, at the annual rate of $500 million & Coe, 507 Main Street.

36

The Commercial and Financial Chronicle

(1776)

Continued

from

Price Index Reaches Lowest Level

Wholesale Food

5

page

.

.

Thursday, November 8, 1951

.

^Continued from page 16

.

Since Nov. 21, 1950

>

.

f

Industry

week.

of

Stabilization

Price

1950 index of

31

21, 1950, when it stood at $6.63.
gain of 2.0% over the comparable

represents the
in general use and

foods

sum

its

-

total of the price per pound of
chief function is to show the

This week the threatened railroad strike against the

lower

Shows Little Variation
From Preceding Week
'

Chicago',

after Presi¬
dent Truman set up an emergency board under provisions of the
Railway Labor Act to deal with the dispute. The union has been
conducting negotiations on wage demands for the past two years.
Brotherhood of Locomotive Enginemen and Firemen

'M-

producers anticipate better balance
supply and demand by mid-1952, says "Steel," the weekly

the

In

■

between

steel

industry

magazine of metalworking, the current week. But for the months
immediately ahead they see no easing in the over-all supply
squeeze. Recent wildcat strikes at several large steelworks resulted
in substantial tonnage losses. < This will mean order carryover
into the first quarter of next year will be larger than previously
indicated.
This tonnage can never be made up and will force

allotments

.

-

trended

in

latter half

the

with 304.18
date
'

a

week

a

304.25

at

close

to

Oct.

on

compared

irregular and prices moved in

were

narrow

a

inquiry

was

substantial

•with

demand

following recent sharp gains.
light but export demand continued active
steady

generally

was

the

under

recorded

sales

International

Wheat

the

•

weaker tone despite the prospect of smaller supplies
Oats were mostly steady, reflecting light domestic

up

>

get into full stride, will not reach peak until well into next year.
Even conditions in the light, flat-rolled products, for which de¬
mand has shown
some
softening, currently are tightening as
heavier tonnages of
of other products,

semi-finished steel

are

diverted to production

particularly plates.

,

metal
castings, and approval of higher prices on galvanized products to
Except for revisions in the ceiling price schedule on
the

offset

recent

2-cent

in zinc, steel and "
No immediate adjustments

related product

prices are unchanged.
prospect, "Steel" concludes.

in

are

American

The

that

Iron

operating

the

rate

steel-making capacity

ingots

104.5%,
tons

a

entire industry

beginning Nov. 5,

ago.

or

and

month

ago.

A

tons

a

decrease of 3.5

i^

castings for

2.089.000

1951,

a

is equivalent to

year ago

2,019,000 tons of

industry,

entire

the

compared

to

and 101.8%, or 2,035,000
it stood at 103% of the old capacity

week

business

Week

The amount of electric energy

at

distributed by the electric light
industry for the week ended Nov. 3, 1951, was esti¬
7,319,019,000 kwh., according to the Edison Electric

Institute.
a

new

high and compared

record

refined by

was

85,091,000 kwh. above that of the

pre¬

11.7% above the total output for
the week ended Nov. 4,
1950, and 1,884,095,000 kwh. in excess of
the output reported for the corresponding period two years ago.

totaled

863,961

freight for the week ended Oct. 27, 1951,
according to the Association of American

revenue
cars,

Railroads, representing
the preceding week.

a

decrease of 22,687

or

2.6%

below

1950, but an increase of 272,646
cars, or 46.1% above the comparable period of 1949, when loadings
were reduced by major strikes in the coal and steel industries.

Output Dips 2% Below Previous Week

Combined motor vehicle production in the United States and

(revised)

units,

and

177,122

units

in the

like

week

of 1950.

Passenger

car

production last week in the United States

was

slightly below the previous week, and about 38% below the like
week of last year.

For the United

States, total output

units from last week's

revised total

week of last year output totaled

rose

of

to

an

estimated 112.047

114,579 units.

In the like

169,553 units.

Total output for the current week was made up of 89,749 cars

work.

short

values

users

lambs

was

the

for

week

reach

to

bullish

the

survey

with prices down sharply for the week
lighter demand.
Hog

the

current

ment's 1951 loan stock showed
the

week

ended

week

Oct.

18,

with

107,000

bales

bales

a

previous, and 110,000 bales two weeks previous.

Trade Volume Shows Noticeable

As

temperatures

dropped

Expansion

as

be

retail

noticeably in most parts of the nation in the
period ended on Wednesday of last week, Dun & Bradstreet, Inc.,
currently reports.

that

first-quarter

for

civilian

stantially
quarter
a

retail

volume

Wednesday of last week
than

that

levels of

South

of

a

a

year

year

ago

England

-j-2 to
+5.

+ 1 to

was

nation

for

the

period

ended

on

estimated to be from 1 to 5% higher
from

tfie

Southwest,

sibilities

East

to

0

Northwest

+4;

-f4

Midwest,

to

+8,

and

Pacific

(Special

largely sustained, during the week, at
the fairly high level of the past few weeks.
Fill-in orders re¬
mained responsible for much of the dollar volume, which was
moderately above the level of a year ago.
The number of buyers
attending various wholesale markets, while somewhat below that
of the prior week, was substantially above last year.
Department store sales

country-wide basis,

taken from
the Federal Reserve Board's index for the week ended Oct. 27,
1951, increased 4% from the like period of last year. ' In the
preceding week an increase of 10% was registered above the like
an

on a

as

increase of 4% for the four weeks ended Oct. 27,

For the year to

date, department store sales registered

considerably less

advance of 3%.

.

Retail trade in New York last week

was

com¬

parable weeks. Less than one-half as many concerns succumbed
as in prewar 1939 when they totaled 318.

buying to avoid the Federal tax increase, which became effective
Nov. 1.
The rise above the 1950 period was estimated for the
at

8%.

ing week

similar

an

week

97

*VJ0 V H>sidA>iriEB'9H&ptjK

Chronicle)

:

r

Chronicle)

K,

Theiss has joined the staff of
Slayton & Company,
Inc., 408 Olive
Street.
'

With Bache
(Special

to Tun

& Co.

Financial

Chronicle)

J* ALEIGH, N. C.—James

Rhoades, Jr. has been
staff of

Bache

of

r

v%t%m

&

E.

added to the

Co.,

Salisbury Street.

126

South

-

,•

James A. K. Marshall
A.

K. Marshall
passed
away at the age of 61 after a
long
illness. Mr. Marshall was a
senior
partner in Wood, Struthers & Co.
of New York.

Edwin Drexel
Edwin

Drexel

Godfrey

Godfrey

away at the age of 71 after

illness.
member

Mr.
of

Godfrey
the

was a

New

passed
a

long

former

York

Stock

Exchange.

CHICAGO, 111.-—The
Committee of the

Executive

Midwest

Stock

Exchange has elected to member¬
ship William H.
Hutchinson,

Hutchinson & Co.,

Pueblo, Colo.

Joins Inv. Service

increase of 4%

3




to The Financial

Midwest Exch. Member

■

stimulated by rush

According to Federal Reserve Board's index, department store

numer¬

metals.

an

(revised) was recorded above the
1950, and the four weeks ended Oct. 27, 1951,
no change was indicated from that of a year ago.
For the year
to date volume advanced 5% from the like period of last year.

were

the

on

„S T. LOUIS, Mo.—Lillian

James

Second consecutive

we£k, casualties

giving buyers

Slay ton Co. Adds

sales in New. York City for the weekly period ended Oct. 27, 1951,
advanced 1% above the like period of last year.
In the preced¬

than in 1950 and 1949 when 181 and 196 occurred in the

is

sub¬

fourth-

ST. CLOUD,
Minn.—Clifford G.
Knier is with King Merritt
& Co.,
Inc., 1-616 St. Germain Street.

Coast

Commercial and industrial failures declined to 143 from 155
In the preceding week, Dun & Bradstreet,
Inc., stated. Off for the
ous

be

than

With King Merrit Co.

and

ago.
Regional estimates varied
by these percentages:
V; •;

and

+6;

the

in

Wholesale buying was

week

Business Failures Decline Further

will

lower

;

Total

1951.

placed at 4,405 cars and
2,795 trucks, against 4,473 cars and 2,163 trucks the week before
and 5,515 cars and 2,054 trucks in the like week of 1950.

CMP allotments

goods

quotas,

can

belief

rather dim view of
Winter pos¬

Merchants generally encountered less difficulty in matching
surpassing last year's sales figures than they had in recent
months; at this time in 1950 the first wave of scare-buying had
ebbed perceptibly.
:
v
v

1950 week and

was

90-

coverage

general

(Special to The Financial

expanded

and 24,443

trucks built in the United States, against 90,136 cars
trucks last week and 144,892 cars and 24,661 trucks in
the comparable 1950 week.

to

acknowledgments

obtained." The

Result

increased,

promotions

and

four-to-six-month

where firm

of Promotions and Colder Weather

trade

lengthening

crop

compared

as

some

hand-to-mouth

■

moderate decline to 92,387

a

the

day bracket, and few have
gone

lowest

of

'

81%
top range of 90 days.

within

build

outlook.
The report
indicated that a carryover of around 3,000,000 bales is in prospect
as a result of the outlook for greatly increased exports and high
domestic consumption.
Entries of the staple into the Govern¬
Agriculture's

-V'

commitments, prevalent in
industrial buying for the
past six
months, still is reported, with

and distributors in an effort to

high levels for the season.
The rise was
trade buying, active foreign price-fixing
interpretation placed upon the Department of

may
near

ture

been

steady

are

de¬

Buying Policy

a

new

by

communities

The very cautious
policy on fu¬

There has

Domestic cotton prices moved steadily upward during the past

previ¬

help. Wage
being formulated now

holding to

prices.

as

areas,. where!

skilled

close

active at moderately higher

more

same

Some

payrolls

indicate labor trouble in the
i
V

-

to

*

on

future,

since last December as market
Steers turned lower
receipts rose to the heaviest since January.
the past week as receipts increased rather sharply.
Trading in
dropped

number

Other

of

mands

the influence of heavier output and

and 22,298

Canadian production last week

further decline

a

at the

built

Employment

total

featured by active forward buying of

was

Lard continued to sag
under

New

Canada the past week, according to "Ward's Automotive Reports,"
declined to 119,247 units, compared with the previous week's total

121,215

showed

quiet

of

or

cars,

The week's total represented a decrease of 23,974 cars, or 2.7%

of

Cocoa

was

stocks

taking up the
slack, report severe payroll cut¬
backs, both in layoffs and hours

into

below the corresponding week in

Auto

market

industrial

or

Carloadings Drop 2.6% Under Previous Week
Loading of

.•',; /..

depleted stocks.

with 7,233,928,000 kwh. produced in the previous week.
The current total

active.

more

The

The sugar market

for

The current total established

ceding week; 768,404,000 kwh.,

was

week.

and

mated

/

were

following some
early strength as the result of better manufacturer interest. Sup¬
plies of cocoa were restricted due to the dock strike with current
stocks reported at the lowest since early August.
Spot coffee
sold at ceiling prices from warehouse supplies as new arrivals
continued to pile up due to the dock tie-up.
the

influenced

and amounted to 1,986,600 tons.

and power

•>'

'

..

be delivered

can

goods

defense work is not

generally firm during the week. Trading
in the domestic market was spotty and mostly of a fill-in nature,
as
buyers held off following recent activity in family and cake
flours as well as hard Winter wheat bakery types.
Export flour

ago,

Electric Output Exceeds Record Level in Latest

v-v

a

industries is not

many

months.

ous

week

having 93% of the
will be 101.0% of

companies

steel

week's operating rate

This

steel

week

a

of

prices

up

this

Steel Institute announced

for the

capacity for the week

points from

and

year.:.'

increase

pound

per

last

■Flour

con¬

caused

work-in-process
slight firming of

remains about the

daily average of 47,000,000 bushels, the latter comparing with

week

has

immediately in increased
needs, as much of

„

in all grain futures on the Chicago Board of
sharply for the week. Sales totaled 234,923,000 bushels,

com¬

pinch of

since the early spring.

The

Transactions

a

The

finished

Trading in rye was more active with prices

country offerings.

relatively stronger than other grains.

or

The

business

new

developed

season.

reluctant

are

easier-to-get

material

from

55,000,000 the previous week, and 50,000,000 bushels for the same

^

Everything considered, prospects appear anything but prom¬
ising for early improvement in general market conditions, this
trade journal points out. - Severe shortage of scrap is threatening
sharp curtailment of production this winter. And to cap it all,
defense requirements, swelling steadily as government programs

,

raw

Corn prices showed strength at times but the market

this

on

reflected

Agreement.
a

or

into firmly
commitments,

materials

inventories.

showing little change for the week.

Domestic

the

drastic run-out of

Grain markets

Wheat

take in

trolled

year ago.

range

to

panion items.

earlier; and with 294.05 on the corresponding

Trade fell

.

production

turned

are

delivery
Purchasing Agents
,

This

30.

postponement of the time when production and consumption can
be brought into
balance despite new additions to producing
1

for

reasons

Most

scheduled

daily wholesale commodity price index
-upward in the first part of the week but moved lower

facilities.

\
\

major

are

stocks.

other NPA allotments. Until these

The Dun & Bradstreet

Ealtimore & Ohio; Louisville & Nashville, gnd
the St. Louis Terminal railroads was postponed indefinitely by the

allotments and end-use

restrictions

Wholesale Commodity Price Index
v

;"

;

planning must be tied to CMP

Operating Rate Scheduled to Drop 3.5 Points

& North' Western;

CMP

and

*

;

j

At Favorable Level

general trend of food prices at the wholesale level.

.creases up

Steel

Activity
Continuing

Seen

The 1951 high was $7.31 on Feb. 20, last.

$6.52.

The index

a

for price ceilings based on their pre-Korean prices, plus cost into last July 26.
v

;
;

will
made

Friday

on

as

low since Nov.

new

a

The current level represents a

begin to
part of
the Economic Controls Law at the time of its extension on July 31,
last. Manufacturers under the revised law are permitted to ask
Office

The

reach

to

This would bring the

by the end of November to 1,339,000, "Ward's" noted.

administer the Capehart Amendment which was

Business

measured by the Dun &
in evidence last
The Oct. 30 figure fell to $6.65, from $6.69 the week before

,

assembled in October.

pared with 108,000

in foods,

Bradstreet wholesale food price index continued

t

♦total

trend

downward

The

The State of Trade and

*

(Special to The Financial
Chronicle)

DENVER, Colo. — Allen C.
Simpson is with Investment Serv¬
ice

Corporation, 650 17th

t:crmm

3 2 4 t\l

Street.

Number 5062

Volume 174

...

Indicated

steel

month ended

or

Week

(percent of capacity).

-Nov.

Previous

Month

Week

Ago

101.0

2,019,000

2,089,000

that date,

AMERICAN

(net tons)—.

Crude

-Nov. 11

INSTITUTE:
condensate output — daily

and

(bbls.

average

of 42

•

^

stilfs—iaily

Crude runs to
average (bbls.) —
Gasoline output (bbls.)_—
—-——.—..
Kerosene output (bbls.)———

Jet.
—Jet.
Jet.
)ct.

___

either for the

are

of that date:;

are as
Latest

103.0.

STEEL

AND

Previous

Yea*

Month

IRON

AMERICAN

Month

Ago

INSTITUTE:

Steel

ingots and steel for castings produced
(net tons)—Month of September.
Shipments of steel products, including alloy
and stainless (net tons)—Month of August

1,986,600

2,035,000

PETROLEUM

oil

of quotations,

cases

Ago

'•

Equivalent to—
Steel ingots and castings

in

or,

Year

101.8

104.5

li

on

37

production and other figures for the

cover

Dates shown in first column

month available.

or

Latest

STEEL INSTITUTE:

operations

latest week

week

Business Activity

tabulations

The following statistical

Indications of Current

AMERICAN IRON AND

(1777)

The Commercial and financial Chronicle

27
27

16,461,000
22,364,000

21,839,000

27

2,573j000

5,895,250
6,051,000
19,878,000

6,337,600

6,353,200
6,481,000

6,339,900

6,558,000
21,085,000

2,549,000

27

,9,380,000

2,415,000
9,461,000

9,124,000

8,433,000

8,502,000

8,332,000

8,495,000

Stocks at refineries, at bulk terminals, in transit and in pipe linesFinished and unfinished gasoline (bbls.) at—
.——.Oct. 27

111,120,000

111,363,000

112,356,000

6,326,464

,

74,035

71,097

64,632

74,191
11,244

75,241

17,235

■

,

.

66,838

62,867

69.062

■

output, all grades

(tons of

lbs.)

105,062,000

33,837,000

8,204,997

5,988,574

INSTITUTE, INC.—Month of

Slab zinc smelter

2,000

*8,733,592

70,623

September:

..

2,288,000
8,259,000

Jet. 27

AMERICAN ZINC

8,644,000

6,755,589

Distillate fuel oil output (bbls.).

——————

Residual fuel oil output (bbls.)___—

(bbls.)

Kerosene

———

,——.——Dct. 27

33,541,000

33,392,000

Oct. 27
Oct. 27

102,106,000

101,548,000

96,695,000

28,634,000
84,057,000

49,168,000

49,279,000

47,893,000

Shipments (tbns of 2,000 lbs.)

—

—

COAL OUTPUT

of

(tons)—

_

10,267

(BUREAU OF MINES)—Month

September:

Bituminous coal

Beehive

and

lignite

(net tons)

42,689,000

47,156,000.

47,297.000

3,178,000

3,514,000

3,835,000

5o2,300

625,400

619,700

.6,470,251

6,777,320

6,329,900

5,923,388

6,152,299

546,863

625,521

5,710,200
619,700

(net tons)

1,763,801

1,626,389

855,133

primary aluminum in the U. S.
of August
(short tons) end of Aug.

Pennsylvania

RAILROADS:
freight loaded (number of cars),—
__
——Oct. 27
freight received from connections-(number of cars)
Oct. 27

J,

Stocks at end of period (tons)
Unfilled orders at end of period

44,486,000

:—

—*

at—

fuel oil (bbls.)

Residual

—

at—.—.——-——
(bbls.) at
——

Distillate fuel oil

~—

73,816

72,693

63,000

10,968

11,369

10,510

3,254,515

3,123,907

2,803,400

3,053,840

2,906,813

2,608,600

99,488

110,278

116,800

101,187

106,816

78,000

anthracite

coke

(net

—

tons)

—

tons)

(net

—

ASSOCIATION OF AMERICAN
Revenue

Revenue

863,961

886,648

864,573

708,620

706,756

887,935
729,735

702,392

COKE

(BUREAU

Production
Oven

Oven

RECORD:
—

construction

Public

and

State

*oV'1

"'jov

——

—

$421,940,000

83,379,000
41,379,000

140,314.000
69,464,000
53.602,000

—

—

——t

municipal

$199,716,000
89,874,000

$189,111,000
105,732,000

$209,778,000

.

construction

Private

i.

Nov. 1
*jov. 1

Total U. S. construction

(net

coke

Eeehive

ENGINEERING NEWS-

CIVIL ENGINEERING CONSTRUCTION

106,926,000
24,967,000

109,842,000

315,014,000

15,862,000

42,000,000

81,959,000

(in

*11,355,000
1,045,000
*131,200

11,075,000

11,724,000

937,000

(BUREAU

short

1,048,000
163,800

AMERICAN
of

(U. S. BUREAU OF MINES):
Bituminous coal and lignite (tons)
OUTPUT

COAL

(tons)_

Pennsylvania anthracite
Beehive coke (tons)

Oct. 27
Oct. 27
Oct. 27

.

—

1,086,000
136,300

132,100

INDEX—FEDERAL RESERVE SYS¬
TEM—1935-39 AVERAGE ==100
—
Oct. 27
:•
; '. *
:
••.
"1.
\:
SALES

313

328

334

327

OF

MINES):

tons)—Month

—

GAS

ASSOCIATION

Month

For

—

August:

Total

gas

(M

therms)___.

Natural

gas

sales

Manufactured

COAL

sales

therms).

(M

"

(M therms)..
(BUREAU

EXPORTS

Month of

therms)

(M

gas

Mixed gas sales

DEPARTMENT STORE

•

——

tons)____.

Stocks of aluminum

23,450,000

11,535,000

1

J.—Jkt

tons).

(net

coke stocks at end of month

Production of

Septjf*

of

tons).

(net

coke

ALUMINUM

86,392,000

OF MINES)—Month

MINES)

OF

—

August:

..

U.

.

-

^

•

/

•

S.

exports

(net

EDISON ELECTRIC INSTITUTE:

6,550,615

7,155,921

Pennsylvania

of

tons)

FAILURES

(COMMERCIAL

INDUSTRIAL)—DUN

AND

STREET, INC.

IRON AGE

7,233,928

7,319,019

Nov. 3

—

—

BRAD-

&

1

South

America

Europe

To

181

,

Asia

;

——

4.131c

3.837c

OF

$52.72

$52.69

$49.36

(net

SERVE

$42.00

Oct. 30
Oct. 30

——

Scrap steel (per gross ton)

4.131c

$52.72

$42.00

$43.00

$40.67

credit

METAL PRICES

Electrolytic

•,

(E.

&

copper—

M. J. QUOTATIONS):
'

refinery at
Export refinery at

Straits tin

Oct. 31
Oct. 31

,

_

27.425c

27.425c

27.425c

—Oct. 31

103.000c

103.000c

103.000c

19.000c

19.000c

17.000c

17.000c

18.800c

18.800c

16.800c

16.800c

19.500c

19.500c

17.500c

17.500c

s

(New York) at—;
Lead (St. Louis ) at
Zinc (East St. Louis) at

.

—

—Oct. 31

97.74

113.89

112.93
A

V

__

,

118.60

110.15

114.66

109.06

108.70
103.47

,_Nov. 5

'

104.66

109.42

109.79

111.07
114.85

U.

BOND

YIELD

of

Nov. 5

corporate

Nov. 5

.

Aa
—

Baa

2.94

3.01;

2.99

CAN

2.89

'

STEEL

OF

INSTITUTE

■

Aug.

SIZE

STANDARD

LAUNDRY

3.16

3.22

2.67

2.72
2.92

.

—

3.47

3.23

Factory sales of washers

3.40

3.39

3.27

3.09

Factory sales of

3.20

3.18

3.11

2.87

Factory sales of dryers

2.97

2.96

2.91

/*'

458.0

458.4

466.0

471.0

3.55
'

of

(tons)
;
Percentage of activity
Unfilled orders (tons) at end of period

Oct. 27

203,278

217,734

218,174

240,123

89

90

104

402,751

429,639

458,150

(1935-33

188,013

*212,256

317,225

229,299

*239,840

198,719

—

,

HOME

694,741

:

IN

100

*

Oct. 27

Oct. 27

.

-

-

SALES

of

motor

trucks—109,353

of

motor

coaches

Month

LOT

DEALERS

SPECIALISTS

AND

EXCHANGE—SECURITIES
Odd-lot sales

EXCHANGE

N.

of September:

Stocks (at end of

7

COMMISSION:

Capacity

——

;

Dollar value

.

;

——

_•

....

Odd-lot purchases by dealers (customers' sales)—
Number of orders—Customers' total sales
Customers'

short

sales

Customers'

other

sales

Customers'

other

sales

$45,120,076
31,172

23,601

32,871

239

131

228

23,470

32,643

35,889

929,213

Oct. 20

8,600

--—Oct. 20

895,257

$38,304,868

$27,166,119

$37,508,929

1,034,529
6,711
1,027,818
$38,463,216

——————.———Oct. 20

296,670

185,090

281,400

340,410

296,670-

185,090"

281~400

340^410

353,150

283,440

364,750

.

_

.

sales......

8,148

921,065

_

'

^

...Oct. 20

—

U. S. DEPT.

-Oct. 20

__

—

PRICES, NEW SERIES
'

I__,

_—~L

*192.3
188.9

183.8

,

——

lighting materials—

.

Building materials
Lumber..
Chemicals

;

'Revised.

and

allied

—

Z_,

253.5

260.1

223.9

c—-

|Not available.

—

7,642,000
98/*

&

M. J.

QUOTATIONS)—

138.8

"138.8

190.9

190.9

138.7

223.7

346.6

345.9
141.8

,141.0

99%

miii,

:

Platinum, refined

(per ounce)

tCadmium

(per pound)——

tcadmium

(per

.

102.000c

42.500c.

Nominal

cS^nnn

S2.o5000

99~%

,

$2.80000

19.000c

^gnes»um, .n8ot (pot pound,.---..

24J00C

x

133.6

♦Revised
the

figure.

tBased cn the producers' quotation.

24 500c

,

24|00c

...

(v.,

«*.

w\»»y

eontanieu.

$2^80000

1/.50DC
^

nitlcl

112.420c

$8!3.5^
35.280c

S*500c

_32^50w
oni\

«K2 40000

$2 65000

$2.^
245oS

.MOO.

2Based on

producers' and platers' quotations.
§ Based onplaters'quotatmns
less than carload lot packed in cases, f.o.b. New York.

tons or more but

^o5.i8xc

$2 52500

j|80000

plus, ingot; (per.PQund)—

,

17.500c

pound)——^Ssoooo

Pound).-,-.-

■

>

.

J59™!!
—

16.040c
15.840c

S0.160c
/8.500c
$2.79921

Nominal

*
—

•

'

42.o00c

Laredo..—
(per pound), Chinese Spot
—

(per pound) in cases,

'

216.0

34J.6

140.7

York

(per ounce,

Aluminum,

179.8

>

223.0

223.8
■

Oct. 30

sstfew

24.425c
;

17.000c
16.300c

103.00QC
102.000c
$35,000

135.6

,

190.9

$2.79943
19.500c

.

164.3'
*

,

——

162.3
/

■

24.200c
27.425c

77.130c

(pence per ounce

(Check)—
pound)—East St. Louis..

239.8

-

158.7

*156.8

Oct, 30

^Includes 400,000 barrels of foreign crude, runs.




.

165.2

—Oct. 30

——Oct. 30
u
..i.1. Oct. 30

—

products—J

156.8

172.4

189.5
284.7

165.1

(per

Antimony

178.8

191.1

282.4

;

165.1

Jet. 30

*

*190.1

189.9

Jet. 30

——

_______

Metals and metal products—^.—

.

98%

(per

Antimony

167.0

247.6

——Oct. 30

177.1

192.1

v>t..

282.1

;

22,910,000

100%

—

U. S. price)———-—
$35,000
Quicksilver (per flask of 70 pounds)
$216:^2 .
^206.250
HAntimony (per pound) (E. & M. J.)—
45.350c
45.o50c
Antimony (per pound) bulk, Laredo—12'SnnS

169.7

177.1

177.0

Oct. 30

;

All commodities other than' farm and foodsTextile products
Fuel and

20,94o,000i

11,277,000

T1New YorkUStraits_.._—,
Gold

OF LABOR—

—

■^Livestock
v

,

■

...

Farm products

Zinc

324,180

189.5

All commodities

(E.

PRICES

Silver, London

:

____

,

22,685,000

25,852,000

_

.

by dealers—

1926= 100:

22,269,000

Sterling Exchange
;_Oct. 20

Other sales

Number of shares

v

1
■
pound)—
V.
Electrolytic domestic refinery....-——...
24.200c
Electrolytic export refinery—27.425c
Lead (per pound 1—
' *'
'
Commoxt, New York
^ ■
'
19.000c
Common, St. Louis.
18.800c
Silver and Sterling Exchange—
;
Silver, New York (per ounce).'.—88.147c

186

30,933
903,857

"

(bb}s.)_^.-.i.^—23,256,000

.......

Average for month of October:

36,075

67j6,754
4,469
672,285

,l__

,

____

Round-lot purchases

METAL

Copper

Oet, 20

—

.

sales

WHOLESALE

1,001,253

$43,015,819

.Oct. 20

short

Round-lot sales by dealers—
Number of shares—Total sales.

;

1,025,367

$45,026,496

Oct. 20

'1

Dollar value,

Short

26,144
770,718

$32,981,060

Oct. 20

*_■

,

—__

Number of shares—Total sales
Customers'

1.016,076

4^-3

MINES)—

_—

32,848

35,154

33.621

Oct. 20

Oct. 20

_

Oct. 20
Oct, 20

——_r

Number of shares—

used

'f??

month—barrcis10,290,000

(bbls.)

STOCK

Y.

—743

(BUREAU OF

Shipment from mills

by dealers (customers' purchases)—

Number of orders

"

THE

ON

of

CEMENT

Production

722,843
616,8.7

121,993
783

!''.v

-

of

PORTLAND

STOCK TRANSACTIONS FOR THE ODD-LOT ACCOUNT OF ODD-

549,708
426,932

FROM

ASSN.)—Month

Number

number

122.8

■

'

Number

138.4

148.9

t,149.0

149.0

Nov. 2

-

124.4

123.0

vehicles—————476,002
passenger cars—
—
365,906

Total

424,0 3
41,400
31,393

v

17,200

•

COMMISSION—

at middle of
average=100)
—.

(AUTOMOBILE MANUof Sept.:

S.

U.

FACTURERS

INDEX —1926-36

40,191

239,081

(units)——.—313,746
18,300
43,752

Number

=

1

-

(units).^..—
(units)...———--

FACTORY

VEHICLE

PLANTS

Production

AVERAGE

;

v

:

Employment

Railway

September

221,590

ironcrs

COMMERCE

INTERSTATE

206,321

PRICE

V\\<-V

V

2.70

-

168.866

REPORTER

44,283,690

46,066,441

ASSOCIA¬

MANUFACTURERS'

3.54

ASSOCIATION:

DRUG

23,777,151

$457,799,100 $421,089,900

46,214,651

TION)—Month of September:

184,971

AND

,

25,663,089

$469,300,000

31—

.

(AMERICAN

2.86

Oct. 27

PAINT

'/.V.

V;

(AMERI-

1RONERS

2.90

*

(tons)

OIL.

1,047

,

CONSTRUC-

WASHERSv AND

..Nov. 5

....

3,7.41

1,197

1,095,..*

V

estimated.——

(tonnage)

Nov. 5

...

5,985
-

1,399

,

26,725,250

(tonnage)—estimated.——.

closed

HOUSEHOLD

MOTOR

PAPERBOARD

Orders received

at

STEEL

TION)—Month of September:

Index

NATIONAL

STRUCTURAL

3.24

L.

INDEX

.

consumers—

.

customers

ultimate

Nov. 5

COMMODITY

'.'VXCOZ

ultimate

to

Nov. 5

Public Utilities Group

MOODY'S

sales

Nov. 5

;

Group

Industrials Group

1,097

INSTITUTE:

Nov. 5

_—

——

Railroad

1,403

^

2.39

3.10

3.18

2.96

2.62

2.65

3.19

;.

Aaa

A

2.65

Nov. 5

Government Bonds

—

-J.-4

Shipments

Nov. 5

8.

Average

3,724

August (GOOs omitted—
ultimate customers—month of

FABRICATED

AVERAGES:

DAILY

3,700

5,486

5,797
6,218

LL———;

..

from

of

Number

119.00

6,200

^

August

115.63

113.89

Month

7,898
4,213
3,645

3,109

—

Kilowatt-hour

13,344

4,138

5,836

•—__—

credit

credit

Contracts

MOODY'S

——

-

7,247

3,149

Revenue

111.44

13,044'

7,320
4,171

...

$19,329

$19,262

13,156

credit

108.88

108.16

113.70

.

Industrials Group

103.30
106.04

V
$19,356

30:

accounts'
Single payment loans.

/

119.61

105.86

Baa

Sept.

Charge

115.24

115.04

of

'

RE¬

short-term

.credit..—

Noninstalment

101.40

115.82

113.31

•

111.25

114.27

109.60

98.21

109.79

.97.72

FEDERAL

credit

EDISON ELECTRIC

Government Bonds

THE

OF

as

~35

14

_—-—

—..—_

credit

Loan

MOODY'S BOND PRICES DAILY AVERAGES:
U. s.

231,370

OUTSTANDING—BOARD

millions

in

Service

Aaa

311,228

Other

126.000c

___Oct. 3l
Oct. 31

at_

Lead

318,092

35

SYSTEM— Estimated

Automobile

24.200c
24.425c

_

(New York)

24.200C

24.200C

24.200c

318,127

294,884

308

tons)

consumer

Sale

■

Domestic

526,289

293,578

(net tons)..

Instalment
•

(net

GOVERNORS

Total

605,128

tons)..^__.__._—

America

(net tons)—

Africa

4.131c

—Oct. 30.

—

;

Central

CONSUMER CREDIT

COMPOSITE PRICES:

Finished steel (per lb.)___
Pig iron (per gross ton).

and

To

133

155

143

NOV. 1

—~

anthracite
(net tons)

•——

North

To

output (in 000 kwh.)—

To

To

Electric

F.O.B. Port

38

The Commercial and Financial Chronicle

<1778)

Securities
New

Acushnet Process Co.
2

filed

Price—To

(11/20)

Bedford,

shares of common

40,000

•

Nov.

6

filed

48,634 shares

III. (11/26-27)
stock (par $2)

of common

7,779 shares of 5% cumulative preferred stock (par
$100). Price—To be supplied by amendment. Under¬

and

Co., Inc.,

Proceeds—To 18 selling stock¬

Chicago, 111.

Columbia Gas System,
1 filed

1,501,826 shares of common stock (no par),

one

share for each

new

10 shares

struction

be

Brothers, Goldman, Sachs & Co. and
Union Securities Corp. .(jointly). Proceeds—To finance
construction program.
Bids—Expected to receive up
(EST)

on

Manufacturers Chemical Co., Milwaukee, Wis.
Oct.

Nov. 26.

Silver

Lead

Mines,

Inc.,

(letter of notification)

2

Duphie,

400,000 shares of capital

common-

Corp.

Co., Inc*, Stowe, Vt.
Oct. 18 (letter of notification) 2,000 shares of common
stock.
Price—At par ($100 per share).
Underwriter—
Proceeds—To retire indebtedness.

None.

National Rubber

of notification)

30,422 shares of capital
stock. Price—At par ($1 per share). Underwriter—None.
Proceeds—To develop oil leases. Office—1049 Southfield
Road, Shreveport, La.

Oct.

30

stock

!

-

v

-

Machinery Co., Akron, O. (11/9)

(letter of notification) 22,000 shares of common

(par $10), to be offered to common stockholders of

record Nov. 9 at rate of one share for each seven

held, with

Florida

an

shares

oversubscription privilege; rights to expire
Price—$11 per share. Underwriter—None.

Telephone Corp., Ocala, Fla.
Oct. 29 (letter of notification) 26,000 shares of common
stock (par $10). Price—$11.50 per share. Underwriter—

Proceeds—For working capital, etc.

None.

change St., Akron 8, Ohio.*

Proceeds—For

Garco Corp.,

expansipn program.

Oct. 30

(letter of notification) 150,000 shares of common
stock. Price—-At par ($1 per share). Underwriter—None.

4V2%
and

Proceeds—For expansion of production. Office—203 West
Thomas St., Seattle, Wash.

—

413

(par

$100),

offered

convertible

for' subscription
one

preferred share for each 12 V2 shares of

general funds of the company, for use in connection
with its steel production expansion program.
MeetingStockholders will vote Nov. 21 on approving authorized
issue of 200,000

shares of preferred stock, issuable
series, and on mortgaging the company's assets.
Ithaca Mutual Music Co., Inc.

in

Nov. 2 (letter of notification) 12,500 shares of common
stock (no par). Price — $10 per share. Underwriter—
None. Proceeds — For working capital and to increase

inventory of music machines and parts.

Neb.,

interest.

Underwriter

Price—At 102
Wachob-Bender

Temple St., Salt Lake City, Utah.

share).

Underwriter—None.

Office—735

<►

Main

Proceeds—To

Avenue-' (P.

O.

Box

drill

375),

wells;

Durango,

Colorado.

*

Southwest

Louisiana

Community Hotel Corp.,

(letter of notification) $225,000 of first mortgage
5% bonds. Price
At principal amount (in denomina¬
tions of $1,000 each). Underwriter—None. Proceeds—To
construct, equip and maintain a hotel.
<
" ■
—

Standard Cable Corp.,

Pittsburgh

San Francisco

Private Wires




to

all

offices

Chicago

Cleveland
-

.

.

.Video

Nov.

2

Corp. of America

(11/9)

(letter of notification)468,105 shares of common
Price—At par (10 cents per share).

stock.

Co., New York.
''
•

Proceeds
■

—

lf■■

Underwriter
For workirtg

'

-Weaver Gold Placers, Inc., Phoenix, Arii.
Oct. 22 (letter of notification) 37,500 shares of 5% pre¬
ferred stock (par $2) and 187,500 shares of common

(par 10 cents) to be offered

in units of one pre¬
Price—$2 per unit* Un¬
derwriter—None. Proceeds—For mining equipment, ex¬
ploration, etc., expenses. Office — 1004 No. Second St.,
Phoenix, Ariz.
ferred and five common shares.

West Coast

Telephone Co. (11/26)
40,000 shares of common stock (par
Price—To be supplied by amendment.
UnderwriterBlyth & Co., Inc. Proceeds—For expansion program and
Nov.

5

filed

to reduce bank loans.

Previous Registrations arid

Filings

'

Abbott Laboratories, Chicago, III. (11^16)
'
Oct. 25 filed 106,851 shares of 4% cumulative preferred
stock (par $100), convertible into common stock prior to
Jan. 1, 1962, to be offered initially for subscription by
common

stockholders of record Nov.

16 at rate of

one

preferred share for each 35 common shares held; rights
will expire Dec. 3. Price^-To be supplied by amendment.
Underwriter—A. G. Becker & Co. Inc., Chicago. 111. Pro¬
ceeds—For capital expenditures and working capital.
Meeting—Stockholders will vote Nov. 13 to approve pro¬
posed new issue.

V

*

★ Air Reduction Co., Inc., N. Y.
*
Oct. 10 filed 248,805 shares of 4.50% cumulative pre¬
ferred stock, 1951 series (par $100)
being offered for
subscription by common stockholders of record Nov. 2
at rate of one preferred share for each 11 common shares
held; with rights to expire Nov. 19. Price—$100 per
share.
Underwriters—Morgan Stanley & Co. and Harriman Ripley & Co., both of New York. Proceeds—For
expansion program.
1
c
,;

Alabama

Flake

Chickasha, Okla.

Allegheny Ludlum Steel Corp.
11 filed 81,347 shares of $4.37 V2 cumulative con¬
(no par) being offered for sub¬
scription by common stockholders of record Oct. 31 at
rate of one preferred share for each 20 shares of com¬
mon stock held;
rights to expire Nov. 14.
Price—$100
per share.
Underwriters—The First Boston Corp. and
Smith, Barney & Co., New York. Proceeds—For expan¬
sion of plant facilities.
Statement effective Oct. 31.
Oct.

vertible preferred stock

Electric Products, Inc.
(N. J.)
(letter of notification) 14,000 shares of common
stock (par $1) and $250,000 of three-year convertible
6% notes.
Price—For stock $3.50 per share and for
Oct. 25

notes

settle accrued wages and a loan td R. P.

at

100%.

Inc., New York.

.

(letter of notification) 11,319 shares of common
stock (par 25 cents) to be issued at $1.50 per share "to

Hall, J. T. Sul¬

livan, L. W. Lord, and W. D. Claypool."

American

Underwriter—Hill,

Thompson

Proceeds—For working capital.

Brake Shoe

&

Co.,
-

Co.

..

1

June 29 filed 50,000 shares of common stock (no pat) to
be offered to certain officers and key employees through
stock purchase plan." Price—To be not greater than
the market price on the date of the offering, or no less
than 85% of such price. Underwriter—None. Proceeds
-^To be added to general funds.
a

Sylvania Electric Products, Inc. (11/20)
Nov. 1 filed $25,000,000 of sinking fund debentures due
1971.
Price—TO be supplied by amendment.
Under¬
writers—Ipaine, Webber, Jackson, & Curtis and Halsey^
Stuart &
Co. Inc., New York..
Proceeds—To retire
$17,200,006 of 334% debentures, to finance expansion
program and for working capital.
^Meeting—Stockholders
will vote Nov, 19 on approving financing program
(See1
also registration of 200,000 shares of preferred stock.)

Underwriter—Paine,

Webber, Jackson &
Curtis, New York. Proceeds—-To increase plant capacity
and for working capital.
Meeting—Stockholders will
vote Nov. '19 on approving financing program. (Seealso
registration of $25,000,000 of debentures.)
Tennessee Gas Transmission Co.

American Investment Co. of Illinois

ible preference stock,

series A (par $25), being offered
for common stock of Domestic Finance
Corp., Chicago, 111. on basis of one American share for,
each five Domestic common shares; the,Offer to expire
in

on

&

exchange

Sept. 30, 1952. Dealer-Managers—Kidder, Peabody
GOV New York, and Alex. Brown & Sons, Baltimore,,»

Md.

Statement effective Sept. 5.

Arcturus

Oct. 26

Electronics, Inc., Newark, N. J.

(letter of notification) 100,000 shares of class

A

.stock to be issued Upon exercise of option warrants by
Dec.

1, 1951, at

10 cents per share.

Price—56^4 cents

share. Underwriter^-None. Proceeds—For general
corporate purposes, to be used mainly to increase manuL
per

facturing facilities.

tures due Nov.

New

Underwriter—To be determined

,

Aug. 16 filed 167,105 shares of $1.25 cumulative convert¬

Nov. 1 filed $25,000,000 of 20-year sinking fund deben¬

1, 1971.

:

Underwriter—Odess, Martin & Herzberg, Inc.. Birming¬
Office—420

Oct. 29

amendment.

Philadelphia

& Co., New

Allied

Jennings, La.
Oct. 29

mm

Boston

mann

ham, Ala. Proceeds—For plant expansion.
Comer Bldg., Birmingham. Ala.

Proceeds—To reduce debt.

Sylvania Electric Products, .Inc. (11/20)
Nov. 1 filed 200,000 shares of $4.25 cumulative convert¬
ible preferred stock (no par). Price—To be supplied by

New York

share.

Underwriter—None, but Landenburg, ThalYork, will act as broker. Proceeds—To
selling stockholder.
per

Graphite Co., Birmingham, Ala.
July 12 (letter of notification) $100,000 of 7% 20-year
sinking fund bonds dated Jan. 15, 1949 and due Jan. 15.
1969 (in denominations of $1,000 each). Price—At par.

—

Recovery Oil Co., Durango, Colo.
Oct. 29 (letter of notification) 50,000 shares 'of common1
stock (may be offered and issued for leases, royalties,
and drilling on basis of one share of stock for each $1
value based on going rates).
Price—At par ($1 per

Un- '

&

;U. S. Rubber Reclaiming Co., Inc.
2 (letter of notification) 4,224 shares of common
stock (par $1). Price—At market, but not less than $5

Nov.

19 West South

com¬

Lynch,
Beane, New York. Proceeds—From
sale of stock, together with proceeds from
proposed sale
of $25,000,000 first
mortgage bonds, will be added to

Pierce, Fenner

Gibbon,

(letter of notification) 500,000 shares of common
stcok (par 10 cents). Price—50 cents per share. Under¬
writer—None. Proceeds—For drilling expenses. Office—

through Dec. 31, 1961, to be
by common stockholders at

stock.

Co.,

bonds, series A, due Nov. 15, 1971*.
accrued

Darling

Price—To be supplied by amendment.
derwriters—The First Boston Corp. and Merrill

mon

Proceeds—For general cor¬

porate purposes.

Oct. 29

Granite City Steel Co., Granite
City, III. (11/28)
Nov. 5 filed 102,276 shares of cumulative
preferred stock

rate of

Telephone

Northern Oil Co., Salt Lake City, Utah •*.

Oct. 29 (letter of notification) 200,000 shares of common
stock.
Price—50 cents per share.
Underwriter—None.

Office

Central

Office—47 West Ex¬

(letter of notification) $55,000 of first mortgage

Corp., Omaha, Neb.

Industries, Inc., Salt Lake City,

Proceeds—For mining expenses.
Bldg., Salt Lake City 1, Utah.

29.

Nebraska

Seattle, Wash.

Nov. 1

Golden Century
Utah

Nov.

on

December.

Underwriter—None.

Plan."

Wis.

Mt. Mansfield Hotel

Corp., Shreveport, La.

(letter

shares of

(11/9)
Nov. 2 (letter of notification) 80,385 shares of common
stock (par 10 cents). Price—$1 per share. Underwriter
—Tellier & Co., New York.
Proceeds — For working
capital.

fices—Duphie, Ida., and 6501 N. Greeley, Portland, Ore.
Dee Cee

375

Mohawk Business Machines

stock (par 10 cents). Price—25 cents per share. Under¬
writer—None. Proceeds—For development of mines. Of¬

Nov.

notification)

of

in

Merchants

be

Milwaukee 4,

Idaho

Oct. 29

(letter

(to

bidding.

& Manufacturers, Inc., N. Y.
300,000 shares of common stock (par $1) to
be issuable under "The Employees Stock Purchase Plan
and The Executive Employees Restricted Stock Option

sold only in Wisconsin). Price—At par
($100 per share).
Underwriter—None. Proceeds—For
working capital. Office—204 West .Washington Street,-.

stock (par $1), to be issued upon exercise of stock
options held by Armand F. DuFresne and Paul W. Heasley. Price—$27 per share. Underwriter—None. Proceeds
—For working capital.
./

Consolidated

29

stock

Consolidated Engineering Corp., Pasadena, Calif.
Oct. 29 (letter of notification) 460 shares of common

ADDITIONS

Nov. 2 filed

stock

1

—

Lehman

a.m.

on

Little Rock, Ark.
(letter of notification) $150,000 of first lien 6%
bonds. Price—At par (in denominations of $1,000 each).
Underwriters
Hill, Crawford & Lanford, Inc., and
Southern Securities Corp., of Little Rock, Ark. Proceeds
—To purchase portable quarrying equipment.
Office—
815 Boyle Bldg., Little Rock, Ark.

supplied by amendment. Underwriters—
competitive bidding. Probable bid¬
ders: Shields & Co. and R. W. Pressprich & Co. (jointly);
Morgan Stanley & Co.; Merrill Lynch, Pierce, Fenner &

to 11:30

be received

Hollow Limestone Co.,

Love

Nov.

To be determined by

Beane;

Bids—Expected to

program.

Nov. 27.

held with

oversubscription privilege; rights to expire about Dec. 12.
Price—To

United

capital.

of former

to be offered to common stockholders of record Nov. 26
at rate of

received

be

to

—-Tellier &

(par $100), will be used to retire $14,493,400 of bonds
subsidiaries, to repay bank loans and for con¬

(11/26)

Inc.

INDICATES

Probable bidders:
Halsey,
Webster Securities Corp. and
White, Weld & Co. (jointly). Proceeds—To repay shortterm notes and for expansion program. Bids—Expected
competitive

proceeds from sale of 100,000 shares of preferred stock

($10 per share). Underwriter—None. Proceeds—To
enlarge insurance business. Office—221 No. 21st St., Bir¬
mingham 3, Ala.
par

Thursday, Novehiber 8,1951

Stuart & Co. Inc.; Stone &

bidding. Probable bidders: Halsey, Stuart & Co.
Inc.; Blyth & Co., Inc. and The First Boston Corp.
(jointly); Lehman Brothers; Kidder, Peabody & Co.;
Smith, Barney & Co.; W..C. Langley & Co.; Union
Securities Corp.; Equitable Securities Corp.; White, Weld
& Co.
Proceeds—From sale of bonds, together with

share for each seven shares held. Price—At

one

Undenvriters-^To be determined by competi¬

tive

Fire Insurance Co. (11/15)
Nov. 1 (letter of notification) 12,500 shares of common
stock, to be offered to stockholders of record Noy. 15 at
Birmingham

Nov.

1976.

due

holders.

rate of

Knorr-Maynard, Inc., Detroit, Mich.
Oct. 31 (letter of notification) $250,000 of 6% 10-year
registered debentures. Price—At par (in denominations
of $1,000 each). Underwriter—Lang-Hennan & Co., De¬
troit, Mich. Proceeds — For working capital. Office—
5743 Woodward Ave., Detroit 2, Mich.

Long Island Lighting Co. (11/27)
Oct. 31 filed $25,000,000 of first mortgage bonds, series D,

A. C. Allyn &

writers—H. M. Byllesby & Co., Inc., and

Office—95 Exchange Street, Portland 6,
;
'

Maine.

Mass.

American-Marietta Co., Chicago,

29

improvements.

be

.

•

by

Portland, Me.

(letter of notification) 2,186 shares of 5y2%
cumulative preferred stock (par $100). Price—$105 per
share. Underwriter—None. Proceeds—For additions and

stock (par $2).
supplied by amendment.
Underwriter—
Paine, Webber, Jackson & Curtis, Boston, Mass. Pro¬
ceeds— To certain selling stockholders.
Office — New
Nov.

Registration

Kankakee Water Co.,
Oct.

.

* REVISIONS THIS WEEK

Now in

Registrations and Filings

.

Jersey.

Office—54 Clark Street, Newark,*

Volume 174

r

Number 5062

.

.

The Commercial and Financial Chronicle

.

Blackwood & Nichols Co., Oklahoma City, Okla.,
and Davidson, Hartz, Hyde & Dewey, Inc.,

'•*

Blyth & Co., Inc., New York and Cleveland. Proceeds-—
To repay loans and for
general corporate purposes.

NEW ISSUE CALENDAR

Madison, N. J.
Sept. 27 filed $2,000,000 of contributions in oil property
(1952 fund) in amounts of $15,000 or more
Underwriter—None. Proceeds—To acquire and develop

★ Eureka

7

■

<

.

Seaboard Air Line RR.

★ Buhner Fertilizer Co., Inc., Seymour, Ind.
Oct. 19 (letter of notification)
3,000 shares of 5%
lative

convertible

of

share for each two

one

shares

will

stock

be

preferred

offered

Price—At

City
repay

par

(convertible

stock

Eureka

shares), of which 500
in exchange for old preferred
($100 per share). Underwriter-

Bank

Burlington Mills Corp.
5 filed 300,000 shares of

stock

November

(par S100).

Florida Power &

convertible

Hycon Corp.

Price—To be supplied by amendment.

Underwriter—Kidder, Peabody & Co., New York.
ceeds—For

additions

equipment.

improvements

plant

to

11

California Tuna

a.m.

Canadian Atlantic Oil Co., Ltd._—
Detroit Edison Co. 11 a.m.
(EST)

Oct. 4 (letter of

Dobeckmun

General

Co.

Office—2305 East Belt St., San

Canadian Atlantic

Oil Co.,

Ltd.

Common

Pittsburgh

outstanding bank loan.

noon

Oct. 30 filed 41,650 shares of

subscription
of

rate

expire

by

share

one

of

Nov.

23

:7.V\

Office—Tarboro, N. C.

——Equip. Trust Ctfs.

1

1951

19,

v,,;

noon

(EST)

Western

■//

———Equip. Trust Ctfs.

;

Northern Indiana

Public

Service Co.—Preference

Leaseholds, Ltd.__„
November

——Common

20,

(12/5) K

Power Co.

Johnston

Oct. 31 filed $7,000,000 first and general mortgage bonds,
series T. due Nov. 1, 1981.
Underwriter—To be deter¬
mined by competitive bidding. Probable bidders:
Hal¬

11:30

Inc.

Proceeds—To repay bank loans.
invited Nov. 21 and opened at

Co., and associates. Proceeds—To refund 3%% senior
to reimburse company for funds used to repay
3Va % installment notes and for business expansion and

★ Central Maine Power Co.

(12/G)

Oct.

common,

31

filed

315,146 shares of

to be offered for

stock and

-shares
stock

for

each

seven

8

new

of

waived

shares.

preferred

common

..Y,: W esf

Co.l

Long Island
„

(par 10 cents).

-

1951
,

'/

xY^^ee,tlber 5' 1951
Co.

Price—25 cents per

share^U'nde#>
,7

(EST)——Bonds

Central Maine Power,Co.—Common
Texas &.Pacific

.Working capital^ Offi<ie^w«)taesb

Ry.^2--l_________Equip.

December
eon->

a.m.

6, 1951

&

★Commonwealth Edison Co., Chicago/ III//"
Opt. 10 filed 1,716,500 sbaresro£ S1.32 cumulative

11

.

.

10,

Trust Ctfs.

1951

~

Virginia Electric & Power Co._„_

Bonds

vertible"preferred stock' (par $25 / being offered first for
subscription by
on

basis

mon

of

common

share

one

stockholders of record Oct. 30

of preferred

14.

Price—

Inc., Philadelphia, Pa.

$31 per share. ^Underwriters—Gloie, Tdrgan & Co. and
Corp., New York.
Proceeds—For new

.construction

i

and

to

repay

loans./'Statement

bank

Deardorf Oil

Corp., Oklahoma City, Okla.*
Sept. 24 (letter of notification) 175,000 shares of
stock (par 10 cents). Price—40
<^ents per share.

e£-

fective Oct. 30.
-Consumers

Public

Service

Co.,

Brookfield,

writer—None.

★ Detroit

Ort
Oct.

93
23

Gas

Co

Atlantic

(letter nf notification)
of nntifiratirm^

ders:

are

Oct.

offered to

15

the




UnderwriterProbable bid-

Hals&yfwSw&t & Co. Inc.; Coffin & Burr, Inc. and^

Co.;'
The.F^r^^|&|fcXprp.; Dillon, Read & Co. Inc.; Kuhn,
Spencer, Trasjk & Co. (jointly); Morgan Stanley &

Highland*

m^QQ

n

I

/'

a
2-for-17 basis; and'
public; rights expire on
Nov. 20. Price—To stockholders, $13 per
share; to public
$14.25 per share. Underwriter—Woodcock, Hess & Co.,

8,599 shares

Of¬

Detroit, Mich.
(11/14)
000,000 of general and refunding mort-

.

Loeb^^SSf^^ds—For construction program. Bids—
Pmarl(EST) on-Nov- 14' at 60 Broacl-

10,399 shares of commopj■.m
stock-(no par) of which 1,800 shares are being
stockholders of record

Under¬

Co.,

competitive bidding.

St., Brookfield, Mo.

ripftpr

Edison

faeries K, due Nov. 15, 1976.

,

short-term notes and for further extensions and betterments of the company's electric property.
Office—201^2

4- Countv

common

Proceeds—For

operating expenses.'
fice—219 Fidelity Building, Oklahoma City, Okla.

Mo.

Aug. 22 (letter of notification) 1,500 shares o£&% cumu¬
lative preferred stock.
Price —At par (.$50.per share).

No. Main

pur¬

poses.

The "First Boston

i

Proceeds—For construction

/f^t^

on

Nov

14

nt

fin

on

Oct. 24 filed 90,000 shares

Ohio (11/14)
of common stock (par $1).

Price—To

amendment.

Dobeckmun Co., Cleveland,

be

supplied

by

Union Co.,

an

New York

-

.

stock (par $10)
to
restricted stock
option plan." Price —To be supplied by amendment.
Underwriter—None.
Proceeds—For general corporate
purposes. Office—50 Church St., New York.
7 filed 64,000 shares of common
be issued pursuant to an "employees'

(11/19)
mortgage bonds, due
Nov. 1, 1981.
Underwriters—To be determined by com¬
petitive bidding.
Probable bidders: Halsey, Stuart &
Co. Inc.; Kuhn, Loeb & Co. and A. C. Allyn & Co. Inc.
(jointly); Stone & Webster Securities Corp.; Merrill
Lynch, Pierce, Fenner & Beane and White, Weld & Co.
(jointly); Salomon Bros. & Hutzler and Union Securities
Corp. (jointly); Lehman Brothers; Carl M. Loeb, Rhoades
& Co. and Lee Higginson Corp. (jointly).
Proceeds—To
Gulf States Utilities Co.

filed

18

Oct.

$10,000,000 of first

pay off short-term
with funds to carry

for each eight com¬

shares held; rights to-expire on Nov.

with

Aug.

.Common
.Preferred

held,

shares

Grand

Bonds

28,

for each seven com¬

oversubscription privilege.
Rights will expire on Nov. 15. Price—Of class A com¬
mon, $13.50 per share and of. preferred, $100 per share.
Underwriter—None. Proceeds—To increase stock interest
hT Whitehead Brothers Rubber Co.
and for working
capital.
Office—Whitehead Road, Trenton 4, N. J.

v;/\ ./,_

City Steel Co

share of class A common stock

mon

—Common

—

1951

yghting Co._
November

Granite

Co.,: Inc;^Ne*v
Proceeds^exploration, drilling and-develOpment- expenses>ete.v :;

and for

-.

27,

4

one

(EST)-Com.

^a^U^^^hbne & Telegraph Co._

,,

.

F6r

^

L

a.m.

N. J.

class A
cumula¬
tive preferred stock (par $100) being offered to stock¬
holders of record Oct. 15 on the following basis:
One
new'share of preferred stock for each share held and

Central Illinois Light Co. 11 a.m. (EST).—Bonds
Erie RR.
Equip. Trust Ctfs.

Century Natural Gas & Oil Corp.
*
i
24 (letter of notification) 23,000 shares of
cormpoa:&

writer—Greenfield

-

/

Pfd. & Common

1951

Rubber Co., Trenton,

(letter of notification) 13,500 shares of
common stock (par $5) and 1,000 shares of 5%

1951

____

November

Oct.

stock

26,

stock.Price—

Underwriter—George F. Breen,
Proceeds—For drilling expenses, repayment
and working capital. Offering—Date not set.

($1 per share).

Goodall
Oct.

*

Probable bidders:" Blyth'& Co., Inc. and^
der, Peabody & Co. (jointly); Coffin & Burr,'>If^|jM^-':''
son
Ripley & Co. Inc.
Proceeds—To repay
construction.

par

New York.

Debs. & Pfd.

11:30

for

its right to subscribe for
150,74p^Fthe new
Underwriter—To be .determined by competitive

new

23,

^ ^.^1^

bidding.

and for

November

■

Montreal, Canada

1951

——Equip. Trust Ctfs.

November

sharc^,of'common stock held; rights, to expire
177, The,England Public
Sej^i^Co. has

Dec.

At

Carolina Telephone & Telegraph Co.—.Common

each seven
on

21,

Mines Ltd.,

April 9 filed 750,000 shares of common

Class B

New York Central RR

7\:,<.;Y

shares

—Debentures

(par^lJQ)^ iOAmerican^Malfiete-fe*£_

stock

Golconda

of advances

stock of record Dec. .5 at rate of five '7

common

held and at^rate of one share of

(EST)___

November

on

subscription by holders of 6% preferred

common

of

;

& Telegraph Co.

*

capital.

working

Common

____'

Sylvania Electric Products, Inc

Bids—Expected to

be
11 a.m. (EST)
Dec. 5 at, 443 Congress Street, Portland, Me. *

a.m.

due

notes,

Parker Pen Co

Stuart & Co. Inc.; Coffin & Burr, Inc. and The First
Boston Corp. (jointly); Merrill Lynch, Pierce, Fenner &
Beane and White, Weld & Co.
(jointly); Salomon Bros.
& Hutzler; Blyth & Co., Inc. and
Kidder, Peabody & Co.
(jointly); Lee Higginson Corp.; Harriman Ripley & Co.

sey,

filed

26

&

1951
.——Common

Testers, Inc.—

Pacific Telephone

(11/14)

$5,000,000 10-year 3V2% sinking fund
Oct. 1, 1961 (subsequently increased to
$7,000,000 principal amount with a 3%% coupon, of
which $3,000,000 will be privately placed,.with two in¬
stitutional investors and $4,000,000 will be offered pub¬
licly). Price—100% and accrued interest./Underwriters
—Paine, Webber, Jackson & Curtis and Kidder, Peabody

.Bonds

Lehigh & New England RR.

Bids—Scheduled to be opened
on Nov. 27.

Maine

13, at Room 2033, No. 2 Rector Street, New York 4,

debentures

..Common

(EST)

noon

Acushnet Process Co.—

★ Central

(jointly); The First Boston Corp.; Harriman Rip¬

Sept.

1951

and for new construction.

(EDT)

filed

'ew York.

Manufacturing Co

Gulf States Utilities Co.

Co.; Morgan Stanley & Co.; Lehman Brothers; First
Corp.; Equitable Securities Corp.; Merrill Lynch,
Pierce, Fenner & Beane. Proceeds—To repay bank loans
a.m.

general corporate purposes.

★ General Acceptance Corp;

&

one

Preferred

November

Boston

of

Brothers; Merrill Lynch, Pierce, Fenner & Beane;
Kuhn, Loeb & Co. Proceeds—For new construction and
equipment.
Bids—To be received at 12 noon (EST) on

'

Fanner

rate

man

ov.

Underwriters—To be determined by competitive bidding.
Probable bidders: Halsey, Stuart & Co. Inc.;
Kuhn, Loeb

at

ley & Co., Inc.; Shields & Co.; White, Weld & Co.; Leh¬

u—Common

Mining Co.
7.
Common
Maryland Ry. 11:30 a.m. (EST)—Bonds

Illinois

8

Inc.; Carl M. Loeb, Rhoades & Co. and Bear, Stearns

& Co.

16,

Nov.

1, 1981.

Co.

& Lake Erie RR.

November

Light Co., Peoria, III. (11/27)
Oct. 26 filed $8,000,000 first mortgage
bonds, due 1981.

at 11

10

petitive

Abbott Laboratories

—

record

(11/13)
$10,000,000 of first mortgage bonds due
Underwriter—To be determined by com¬
bidding.
Probable bidders: Halsey, Stuart &

Oct.

—Common

__u—_—.—4.—_____——

for

Nov.

Common

Silver Buckle
Western

at

each three shares held; right to
Price—At par ($100 per share). Un¬
Proceeds
To reduce bank loans.

derwriter^— None.

★ Central

(11/23)

and

—.Common

(EST)

Silex Co.

stock to be offered
record

Common

for

Dec. 12.

on

common

stockholders

2

of

each

★Florida Power & Light Co.

-

Proceeds—To liqui¬

★ Carolina Telephone & Telegraph Co.
for

Co.,

15, 1951

share for

an

loans

_________

stockholders

twenty common shares held;
oversubscription privilege; rights to expire on
23.
Price—$50 per share.
Underwriter—Allen &
New York.
Proceeds—To retire short-term bank

Nov.

Common

Controls, Inc.,

.Metals & Chemicals Corp
Oxford Paper Co.

(11/19-24)

350,000 shares of common stock (par $1).
be supplied by amendment. Underwriters—

&

common

Common

Manufacturing Co._________

Imperial Oil, Ltd

working capital.

filed

preferred

Debentures

(11/14)

olds & Co, and Bear, Stearns & Co.
date

Bonds

Birmingham Fire Insurance Co.___

warrant to purchase one addi¬
share—Canadian—at any time

19 filed 62,041 shares of 5% cumulative preferred
stock, series A (par $50—convertible into common stock
prior to Nov. 1, 1961) to be offered for subscription by

—Common.

New York Air Brake Co

(par $2—
Canadian), of which 700,000 shares are for the account
of the company and 650,000 shares for Pacific Petroleums
Ltd. of Calgary, Alberta, Canada.
Price—To be supplied
by amendment.
Underwriters—In United States: Reyn¬

a

per

Fedders-Quigan Corp., L. I., N. Y.

——Common

November

for,

$1.25

Oct.

with

Oct. 19 filed 1,350,000 shares of common stock

shares for each

stock held as of
Subscribers will receive for each three

Cleveland Corp., Cleveland, O., and A. C.
Co., Inc., Chicago, 111. Proceeds — To C. G.
Raible, President of the company, who is the selling
stockholder.
Offering—Expected week of Nov. 19.

Preferred

Acceptance Corp.__.___

Jacobsen

Diego 2.

Calif.

two

common

First

Penn

interest.

crued

■.

The

1951

14,

30

Allyn

Common

Telephone & Telegraph Co.
(EST)

common

basis of

Manufacturing Co.

Price—To

Bonds

Associated

Packing Corp., San Diego, Calif.
notification) $300,000 of 6% convertible
sinking fund debentures due Oct. 1, 1966. Underwriter—
Wahler, White & Co., Kansas City, Mo. Proceeds—For
general corporate purposes.
Price—At 100% and ac¬
*

(EST).

noon

(EST)—Equip. Trust Ctfs.

November

and

Oct.

1951

_______

Pro¬

Offering date postponed.

and

Light Co.

Great Northern Ry. noon

prelerred

13,

at

on

$l.par value

9.

Proceeds—For

Common

Fanner

Building, Seymour, Ind.

March

Canada (11/9)
stock (par 25
3,234,303 shares are to be

Toronto,

until June 1, 1953. Rights will expire on Nov. 29. Price
—55
cents
per
share—Canadian.
Underwriter—None.

Common

________

Nov.

tional share

-—-Common

Video Corp. of America—

of

shares subscribed

Common

Machinery Co

shares

record

-Common

Mohawk Business Machines Corp.___
National Rubber

three

9, 1951

Freightways, Inc
Corp., Ltd

common

offered to stockholders

(EST)__Eq. Trust Ctfs.

Consolidated

rate

at

Ltd.,

cents—Canadian),vof which

1951

8,

noon

November
cumu¬

Securities Corp., Indianapolis, Ind. Proceeds—To
bank loan and for working capital. Office—First

National
>

November

-

.

Corp.,

Oqt. 9 filed 4,312,404 shares of

interests

oil property.

39

(1779)

Underwriter—

loans and to provide the company
forward its current construction pro¬

gram to the Spring of 1952, at which time company ex¬
pects to undertake additional financing. Bids—Expected
to be opened at noon (EST) on Nov. 19.
>

Waukesha, Wis.
9,190 shares of common
Price—At market (approximately $10.50

Hein-Werner Corp.,
15

Oct.

(letter of notification)

stock (par $3).
per

share).

Underwriters—Northern Trust Co., Chicago,

111, and The Marshall Co., Milwaukee, Wis.
Proceeds—
To E. G. Bach, Executor of the Estate of I. Hadcock.
Helio

July

31

Norwood, Mass.
of notification) 7,750 shares

Aircraft Corp.,

(letter

cumulative
of common

of non-

preferred stock (par $1) and 7,750 shares
stock (par $1) to be offered in units of one

and one share of common stock.
($20 for preferred and $5 for com¬
mon). Underwriter—None. Proceeds—For development
and promotion expenses.
Office—Boston Metropolitan
Airport, Norwood, Mass.
share

of

preferred

Price—$25 per unit

Continued

on

page

40

40

The Commercial and Financial Chronicle

(1780)

Continued

jrom

page

purposes.

•

Office—412 W. 39th St., Kansas City,

Co., No. Canton, O.

Hoover

effective Oct. 24.

4,000 shares of common
stock (par $2.50). Price—$18 per share.
Underwriter—
Hornblower & Weeks, New York. Proceeds—To William
W. Steele, the selling stockholder.
(letter of notification)

22

Loven

Oct.

luna

&

Co., Wallace, Ida.
Oil

Imperial
Oct.

filed

31

Ltd.,

Canada

Price—At
Proceeds

South Pine St.,

Proceeds —For mine equip¬

Toronto,

Fire Insurance
Co., N. Y.
1
(letter of notification) 50,000 shares of common
stock (par $10) to be offered for
subscription by stock¬

200,000 shares of capital
($1 per share).
Underwriter—
For working capital.
Office — 244

holders of record

par

—

each

Newhall, Calif.

(11/15)
(no par)

scription at rate of one new share for each 10 shares held

represented by share warrants. Price—To be supplied
by amendment.
Underwriter —r None.
Proceeds — For
general funds and working capital.

this month.

or

Inland

Steel

Maracaibo

To be

Co.

Iowa

fair market value

held

Utilities

Oct.

on

of

with

24,

•>

writer— None.

of the stock.

Proceeds —To

ity.

acquire

new properties
Statement effective

vertible preferred stock called for redemption on Nov. 24
at $30.75 per share (conversion right expires on Nov. 23).

.Price—To underwriter at par.

conversion

of

38,239

shares

of

5Vz %

con¬

Underwriter—The First
Corp., New York. Proceeds—To reimburse com¬
pany for money expended for redemption of unconverted
portion of 5% % preferred stock.

III.

★ New York Air Brake Co., N. Y.
Oct.

Proceeds—For general corporate purposes.

Price

26
—

F.

Palmer

Trust

and

Proceeds—

Rosalie

Invest¬

share) for stock and notes in units of $500 each.

26

filed

160,000

shares of 5%%

prior preferred

(par $25).

ceeds—For construction program.

Offering—Indefinitely

•

.

...

Penn

Controls, Inc., Goshen, Ind. (11/14)
Oct. 25 filed 100,000 shares of common stock
(par $2.50).
Price—To be supplied by amendment. Underwriter—F,
S. Moseley & Co., Boston, Mass.
Proceeds—For expan¬
sion program and

working capital.

Phoenix-Campbell Corp., N. Y.
Sept. 20 filed 203,000 shares of capital stock (par $1)
and
100,000 warrants.
(Oct. 22 filed by amendment

(11/14)

filed 200,000 shares of common
To be supplied by amendment.

Co., Inc., Milwaukee, Wis.

postponed.

Rearing Co., Inc.
'
Sept. 26 (letter of notification) 3,200 shares of common
stock (par $1). Price—$31.25 per share.
Underwriter—
Blyth & Co., Inc., Los Angeles, Calif. Proceeds—To Lloyd
A. Johnson, President, who is the selling stockholder.

(11/14)
Oct. 25 filed 120,000 shares of common stock (par $1).
Price—$8.37 V2 per share. Underwriter—A. C. Allyn &
Co., Inc., and Shillinglaw, Bolger & Co., both of Chicago,

&

William

Price—To be supplied by amendment.
Underwriter—A. C. Allyn & Co., Inc., Chicago, 111. Pro¬

National Motor

-Jacobsen Manufacturing Co.

Underwriter—

Peabody Coal Co.

.

Boston

share.

per

working capital.

Proceeds—To erect parking facil¬
Office—1002 Warm Springs Avenue, Boise, Idaho.

March

Estate of Rachel B. Miles.

for

Price—$30

Pen

Baird

per

itock

Miles

Oct. 5 filed 76,478 shares of common stock (par $15) re¬

Nov. 21.

filed

The

($10

Laboratories, Inc., Elkhart, Ind.
Oct. 12 (letter of notification) 6,000 shares of common
stock (par $2).
Price—Maximum, $18 per share; mini¬
mum, $16.50 per share.
Underwriter—Albert McGann
Securities
Co., Inc., South Bend, Ind.
Proceeds—To

served

for

Underwriter—N'one.

.

Co.

share

new

Parking, Inc., Boise, Ida.
Sept. 24 (letter of notification) 12,500 shares of common
stock and $25,000 of 5% debenture notes. Price—At
par

oversubscription privilege;
Price—$9 per share.
Under¬

and for general corporate purposes.
Oct. 17.

one

ments, Ltd., the selling stockholder.

share for each nine shares

one

W.

To

/•'

'■

of

Co., Janesville, Wis. (11/20)
88,277 shares of class B common stock
Price—To be supplied by amendment. Under¬
writers—A. G. Becker & Co.
Inc., Chicago, 111.; and Rob¬
31

ert

an

rights to expire Nov. 21.

working capital.

Southern

'•

rate

(par $2).

Oil

to stockholders at rate

of current

85%

:

out of

Proceeds—For

Oct.

Exploration Corp.
Sept. 20 filed 49,500 shares of capital stock being offered

Aug. 27 filed 250,000 shares of capital stock (no par)
to be issuable upon exercise of stock option issuable
under the company's proposed stock option plan. Price—
Proceeds—For

'

at

(Transamerica
Corp.
owns
100,000 shares outstanding); rights will

on

Parker

31

held.

None.

York.
and

Oct.

shares

expire

Proceeds—To retire outstanding preferred stock
to reduce construction notes.
Offering—Expected

to be offered to stockholders of record Nov. 15 for sub¬

two

91,674%

^ Lowell Gas Co., Lowell, Mass.
Oct. 19 filed 30,000 shares of 6% cumulative preferred
stock (which had been offered to holders of the out¬
standing 12,000 shares of preferred stock at rate of 2%
shares for each share held by them with rights expiring
Oct. 5, 1951): none subscribed for.
Price—At par ($25
per share).
Underwriter—Coffin & Burr, Inc., New

Seattle, Wash.; and Penna-

2,713,384 shares of capital stock

Paramount

Oct. 23

(letter of notification)

None.

Address—Box 469, Wallace, Ida.

ment.

8

-

Chemical of California

stock.

^ Idaho Custer Mines, Inc., Wallace, Ida.
Oct. 22 (letter of notification) 168,000 shares of common
stock (par 10 cents). Price—40 cents per share. Under¬
writers—H. M. Herrin & Co.,

Thursday, November 8, 1951

.

Oct. 3 filed 100,000

Mo.

Oct

.

Packard-Bell Co., Los Angeles, Calif.
*Long Island Lighting Co.
shares of cumulative preferred stock, < Oct. 25' (letter of notification) 9,000 shares of common
series A (par $100).
Underwriters—To be determined ; stock (par 50 cents). Price — At market (estimated at
$10.75 per share). Underwriter—Shearson, Hammill Si
by competitive bidding. Probable bidders: Blyth & Co.,
Co., Los Angeles, Calif. Proceeds — To H. A. Bell, the
Inc., and First Boston Corp. (jointly); Kidder, Peabody
& Co.; Harriman Ripley & Co. Inc.; Smith, Barney &
selling stockholder.
Pan American Milling Co., Las
Co.; W. C. Langley & Co. and Glore, Forgan & Co.
Vegas, Nev.
Jan. 24 filed 200,000 shares of common stock.
(jointly). Proceeds—From sale of preferred stock, to¬
Price—At
Par ($1 per share).
gether with proceeds from proposed sale of $25,000,000
Underwriter—None. Proceeds—To
of first mortgage bonds on Nov. 27, 1951, will be used to
purchase machinery and equipment, to construct a mill
retire $14,493,400 of bonds of former subsidiaries, to pay
in Mexico and for general
corporate purposes. State¬
off bank loans, and for construction program. Statement
ment fully effective Aug.
29, 1951.
i

39

Hex Foods, Inc., Kansas City, Mo.
Aug. 1 (letter of notification) 89 shares of 6% cumula¬
tive preferred stock (par $100) and 424 shares of com¬
mon stock
(no par). Price—For preferred, at par; and
for common, at $20 per share. Underwriter — Prugh,
Combest & Land, Inc., Kansas City,- Mo., will act as
dealer. Proceeds—For plant improvements and general

corporate

.

109,650

stock

(par $5).

to

Underwriters-

of

shares of which 100,000 shares will be offered
public and 9,650 shares will be reserved for exercise
warrants

b,y

brokers

and

dealers).

Price—$10

per

Smith, Barney & Co. and Dominick & Dominick, New
share.
Underwriter—Morris Coh'on & Co., New York.
Testers, Inc., Houston, Tex. (11/20)
York. Proceeds—To reimburse treasury for
Oct. 29 filed 540,000 shares of common stock (par $1).
purchase oi -i Proceeds—To acquire an interest in so-called "special *
Hydraulic Equipment Co. of Cleveland, O.
situations" and for working capital.
Price-^-To be supplied by amendment
:
'"
Underwriters— ;
;t,
'
;
White, Weld & Co., New York; Rotan, Mosle & More- v : Nickel Offsets, Ltd., Toronto, Canada
Phoenix Industries Corp., N. Y„
'*
\ Oct.
8 filed 500,000 shares of common stock (no
land, Galveston, Tex.; and Russ & Co., San Antonio, Tex.Oct. 12 filed 1,465,167 shares of common stock (par
par) to
100)
be offered for subscription by stockholders at rate of one
Proceeds—To purchase outstanding stock of three com¬
to be offered to holders of outstanding common stock of
share for each five shares held.
panies. Business—Services oil well drilling industry.
National Power & Light Co. at rate of one-half share of
/v '
Price—$2.25 per share.
(Canadian funds).
Underwriter—None.
Proceeds—To
Phoenix Industries Corp. (name to be
Keever Starch Co., Columbus, Ohio
changed to Na¬
repay loans from Cliff Petroleum Co. and for expansion
tional Phoenix Industries, Inc.) for each N. P. & L.
Aug. 1 (letter of notification) 50,400 shares of common
program.
Business — To acquire, explore and develop
common share held as of Nov.
jftock.
8, with an oversubscrip¬
Price
At par ($5 per .share).
Underwriter—
mining properties in Canada. ; '
tion privilege; rights to
.None. Proceeds—To finance inventories and to
expire Nov. 29.
Price —To be
purchase
Norfolk & Carolina Telephone &
supplied by amendment.
Underwriter—Reynolds & Co.,
capital equipment. Office—538 E. Town St., Columbus,
Telegraph Co.
New York.
Oct. 11 (letter of notification) 2,000 shares of common
Proceeds—To pay expenses of existing busi¬
iOhio.
V:
jj. '/">.■;; . ■/T.
stock to be offered for
ness, to pay final instalment of purchase price on shares
subscription by stockholders of
Key Oil & Gas Co., Ltd., Calgary, Canada
of Nedick's, Inc., and for
record Oct. 15, with rights expiring Nov. 10. Price—At
acquisition of other businesses.
Oct. 3 filed 500,000 shares of common stock.
Price—At
par ($100 per share).; Underwriter—None.
Proceeds— v
Phoenix Mortgage
Co., Inc., Union City, N. J.
ipar ($1 per share)..
To retire notes and for expansion
Underwriter—None, but sales will
Oct. 24 (letter of notification) 500 shares of common
program;
Office—
foe made by James H. Nelson, promoter and a director of
South Road Street, Elizabeth
stock (no
City, N. C.
par), 500 shares of $3 preferred stock (no par)
company, of Long view, Wash.
Proceeds—To drill well, r
and $200,000 of 8% 20-year debenture bonds.
Northern Illinois Corp., DeKalb, III.
Price—
jfqr lease acquisitions and properties held pending devel¬
For stock $100 per share and for bonds at
Sept; 13 (letter of notification) 5,138 shares of common
par in denomiopment work, and for other corporate purposes, v
\
* stock
nations of $10 each.
(no par). Price—At market (hot less than $9 per
Underwriter—Irving Blum, Union
^Kimberly-Clark Corp.
share). Underwriter — None. - Proceeds
For working > City, N. J. Proceeds—For working capital. ; ! " '
'
-Oct. 5 filed 102,424 shares of 4% cumulative convertible
capital. \
Pittsburgh Plate Glass Co.
;
•preferred stock (par $100), being offered in
exchange
June 27 filed 450,000 shares of common stock (par $10) '
* Northern Indiana Public Service Co. (11/19)
:lor outstanding 4V2% cumulative preferred stock on a
Oct. 30 (letter of notification) 240,000 shares of cumu¬
to be offered to certain
employees of the company and
jshare-for-share basis, plus cash payment of 37
lative preference stock (par $25) to be offered to com¬
x/2 cents
Its subsidiaries under a stock option plan.
Price—At
per share; the offer to expire on Nov. 9.
Underwriter—
mon stockholders of record Nov. 9 at rate
85% of the market price on the New York Stock Ex- •
of one addi¬
Blyth & Co., Inc.,'New York.- Proceeds—To retire un¬
tional share for each 12%-shares
change at time options are granted. Underwriter—None.
held; rights to expire
exchanged 41/2% preferred stock.
Underwriters have
about Dec. 3;
Price—To be supplied by amendment.
Proceeds—For working capital.
r
•agreed to purchase a maximum of 37,424 shares of 4%,.
Underwriters—Central Republic Co., Inc.; Blyth &
Co.,.
Prugh Petroleum Co., Tulsa, Okla.
V
preferred stock at $107 per share-arid accrued
dividends, : Inc.; and Merril Lynch, Pierce, Fenner & Beane. Pro¬
Sept. 25 (letter of notification) 60,000 shares of common
•providing at least 65,000 shares of 4M>% preferred stock ' ceeds—For construction
program. Statement expected to
stock being offered for subscription by stockholders of
-accept exchange offer. Statement effective Oct. 25.
become effective on Nov. 19.
record Oct. 1, on basis of any number of shares not to
Kingsburg Cotton Oil Co., Kingsburg, Calif. '
exceed present holdings; rights to expire Nov. 15. Price •;
''
Oxford Paper Co., N. Y." (11/15)
Oct. 22 (letter of notification).,2*000 shares of
—At par ($5 per share). Underwriter—None, but Prugh,
capital
Oct. 26 filed 163,676 shares of common stock
(par $15).
stock (par $1).
Price—$4.25 per share. Underwriter—
Combest & Land, Inc., Kansas City,
Price—To be supplied by amendment. Underwriter—The
Mo., will act as
Fewel & Co., Los Angeles, Calif.- Proceeds—To
Richard
agent.
Proceeds—To develop properties and retire in¬
First Boston Corp., New York. Proceeds—To two
selling
"W. Fewel,. the selling stockholder.
debtedness.
Office—907 Kennedy Bld.g., Tulsa 3, Okla.
Address-^-P.X). Box
stockholders. " * —*;
/'
'277, Kingsburg, Calif.
Pubco Development, Inc., Albuquerque, N. M.
Pacific Telecoin Corp., San Francisco, Calif.
Kohn & Co.,
Sept.,; 18 filed 605,978 shares of common stock being ^
Columbia, S. C.
Sept. 14 (letter of notification) 59,000 shares of common
Oct. 22 (letter of
offered for subscription by stockholders of Public Serv¬
notification) 925 shares of common
stock .(par 10 cents). Price—50 cents per share. Under¬
ice Co. Of New Mexico between Jan. 1, 1955 and JMarch
stpck, to be offered to present stockholders for
subscrip¬
writer—Gearhart, Kinnard & Otis, Inc., New York. Protion and in
31, 1955 at rate of one share of Pubco Development far
exchange for outstanding debentures. Price—
ceeds—For working capital.
Office—1337 Mission St.,
each Public Service common share held of record
par ($100 per share). Underwriter—None.
Proceeds ; San
Francisco, Calif.
\
-t^To retire debt,-Office—1526 Main St., Columbians. C.
1," 1951,' Price—At par ($1 per-share). Underwriter-^^
Pacific Telephone & Telegraph Co.
None. Proceeds—To be used by Public Service in
(11/20)
Lawyers Title Insurance Corp.,
Richmond, Va.
Oct. 19 filed $30,000,000 30-year debentures due Nov.
eral fund.
Business—To prospect for oil and gas. State-«
15,
Oct. 16 filed 60,000 shares of
capital stock (par $5), to
1981.
Underwriters—To be determined by competitive
ment effective Oct. 11.
Johnston

,

•

.

,

■

..

—

\

.

.

„

—

,

...

-

■

,

,

.

..

v

...

_

foe offered to stockholders at rate
of
shares held. Price—At

Jtune

writer—None.

($5

•

one

share). Under¬
Proceeds—To enlarge capital and for inpar

per

vestment.

Lockheed Aircraft Corp.
Oct. 17 filed 27,000 shares of
capital stock (par $1), issu¬
able upon exercise of certain
options granted to a selected
group of officers and employees of
company and its sub¬
sidiaries, together with 19,370 shares
previously regis¬
tered and issuable upon exercise of
options heretofore
granted to officers and employees.
Price
$19.35 per
share.
Underwriter—None. Proceeds—For general cor¬
porate purposes.




„

share for each

—

'

bidding.
Probable bidders: Halsey, Stuart & Co. Inc.;'
Morgan Stanley & Co.; Lehman Brothers and Union Se¬
curities Corp. (jointly); White, Weld & Co.
Proceeds—
To repay bank loans and for new construction.
Bids—
Expected to be received at 195 Broadway, New York,
N.

Y., before 11:30

a.m.

(EST)

on

Nov. 30.

-A Pacific Telephone & Telegraph Co. (11/27).,
Oct. 19 filed 633,274 shares of common stock to be offered
for subscription by, common and
preferred stockholders
in the ratio of

shares of

one

common

At par ($100 per

Snare of common stock for each nine

and/or preferred stock held.

share).

Underwriter—None.

—To reduce bank loans and for
plant

Price—
Proceeds

improvements.

;

Public Service Electric & Gas Co.

249,942 shares of cumulative preferred
Price—To be supplied by amendment.
Underwriters—Morgan Stanley & Co., Drexel & Co. and
Glore, Forgan & Co. Proceeds—For plant additions and
improvements and to reimburse treasury for expendi¬
tures made for such purposes and for retirement of longterm debt.
Offering—Postponed.
Sept.

26

filed

stock (par $100).

Puritan

Life

Insurance

Co., Providence,

R.

I.

stock
(par $25).
Price—$75 per share.
Underwriter—None.
Proceeds—For working capital.
Office — Turks Head
Bldg., Providence 1, R. I.
Oct. 9 (letter of notification) 2,000 shares of capital

Volume 174

Number 5062

Ritchie Associates

The Commercial and Financial Chronicle

...

Finance Corp.

&

Co., Ltd., and Mills, Spence & Co., Ltd., in Canada (for
625,000 shares). Proceeds—To 39 selling stockholders.

Sept. 18 (letter of notification) $200,000 of 6% 15-year
debentures, dated July 1, 1951, to be issued in multiples

June 12 (letter of notification) 10,000 shares of common
stock (par $10) to be offered for subscription by present

stockholders at rate of

Rockland Light & Power Co.

&

coupon.

Underwriters—Awarded on Nov. 7 to Halsey,
Co., Inc., on its bid of 102.0202 on a 3%%
Proceeds—To reduce bank loans and for con¬

Corp., Seattle, Wash.
(letter of notification) 3,000 shares

12

Price—At par ($100
Proceeds—-To pay

None.

of, class B
Underwriter—

share).

per

part of purchase price of
Seattle steam heating properties and for
working capital.
Office—1411 Fourth Ave., Seattle, Wash.

★ Silex Co., Hartford, Conn. (11/15)
Oct. 19 (letter of notification) 53,750 shares of
stock

each

four

common

held;

—

working capital.

Office—80 Pliny Street, Hartford,

Conn.

••

'

Prospective Offerings

'•

Associated Telephone & Telegraph Co.

(11/14)
Nov. 14
by the Office of Alien Property, 120 Broadway, New
York 5, N. Y., for the purchase from it of 5,201 shares of
$6 cumulative first preferred stock (no par), being 17.4%
of that issue outstanding.

Mining Co., Wallace, Ida. (11/15)
Sept. 25 (letter of notification) 290,000 shares of com¬
mon stock
(par 10 cents). Price—32Vz cents per share.

Bids

Underwriter—Standard Securities Corp., Spokane, Wash.,
and Kellogg, Idaho. Proceeds — To six
selling stock¬
holders. Address—Box 469,
Wallace, Idaho.

filed

15,

ment.
and

17,500

shares

of

$5.50

cumulative

Webster

Securities

Corp., both of New
York, and Rauscher, Pierce & Co., Inc., Dallas, Texas
Proceeds—To retire $1,500,000 of bank loans and the
added

to

general corporate

funds.

Offering

Postponed.

■

ic Standard Oil Co.
Oct.

18

of

common

being offered for subscription by
of record Nov. 7 at rate of

common

(par $10)
stockholders

Central
Oct.

30

sell

40,000

Price—To be supplied by
Underwriter—F, S. Moseley & Co., Boston,

Proceeds—For capital expenditures and working

Sterling, Inc., New York
(letter of notification) 10,000 shares of

Oct. 22

common

(par $1). Price—At market (approximately $4.50
share). Underwriter—Merrill Lynch, Pierce, Fenner

Beane, Chicago, 111. Proceeds—To David S. Berry,
Vice-President, who is the selling stockholder.
Toklan

Royalty Corp., Tulsa, Okla.
(letter of notification) 10,000 shares of common
(par 70 cents). Price—At market (estimated at

Oct. 10

share)
Underwriter—None.
Proceeds—To
Bryan, President, the selling stockholder.
Office—635-644 Kennedy Building, Tulsa, Okla.
per

F.

Toklan

Royalty Corp., Tulsa, Okla.
(letter of notification) 25,000 shares of
(par 70 cents).
Price—$4.50 per share.

Oct. 11
stock

common

Under¬

writer—None.
Proceeds—To 1 purchase for investment
450,000 shares of capital stock of Palmer Stendel Oil Co.
Office—635-644

United

Kennedy Building, Tulsa, Okla.

States

Radiator

Corp., Detroit, Mich.
Oct. 22 (letter of notification) 5,085 shares of preferred J
stock (par $50).° Price—At market (estimated at $44 per
share).

Underwriter

capital.

Office—300 Buhl Bldg., Detroit 25, Mich.

—

None.

Proceeds

—

For

working

Viking Plywood & Lumber Corp., Seattle, Wash.
Oct. 19 filed 22,500 shares of common stock (no par) to
be offered to employee-stockholders in minimum units
of 125 shares per unit.
Price—S20 per share.
Under¬
writer—None.
Proceeds—To purchase 50% of capital
stock of Snellstrom Lumber Co.
Vinco
Oct.

11

stock

Corp., Detroit, Mich.
(letter of notification) 8,973 shares of

(par $1).

Price—$10.50

Detroit

28,

per

Mich.

Withdrawal

—

Letter

has

been withdrawn.

Vulcan Iron

Works, Wilkes-Barre, Pa.
notification) not to exceed 17,000 shares

Oct. 17 (letter of
of

common

stock

(par 50 cents).

Price—At the market

(approximately $2 to $2y4 per share). Underwriter—
None, but Eaton & Co., New York, will handle sales on
the

over-the-counter

market.

Proceeds—To

John

A.

Roberts, Chairman, who is the selling stockholder.

•^Western Air Lines, Inc., Los Angeles, Calif.
Sept. 17 filed 25,000 shares of capital stock (par $1) under
option at $9.37 J/2 per share since Dec. 10, 1946 to T. C.
.Drinkwater, President. Agreement provides that, upon
request of Mr. Drinkwater, the company agrees to regis¬
ter the optioned shares to the end that he may be in
a position promptly to exercise his
rights under the op¬
tion and to transfer and dispose of any of the shares ac¬

quired thereunder which he may wish to dispose of. (The
stock sold at $14.50 per share on Sept. 17 on the New
York Stock Exchange.) Underwriter—None. Proceeds—
For working capital
($9.37Y2 per share).
Statement
effective Oct. 24.

4-Western Leaseholds, Ltd., Canada

(11/19-20)

Oct. 30 filed 1,250,000 shares of common stock (no par).
Price—To be supplied by amendment.
Underwriters—

Morgan Stanley & Co. and Carl M. Loeb, Rhoades & Co.
in the United States (for 625,000 shares) and A. E. Ames




submitted to RFC the best bid of 100.375

for the purchase from RFC of

first
was

$5,200,000 of the company's
mortgage 4% series A bonds due Jan. 1, 1993. This
5% points above the nearest syndicate bid.

Diamond

Alkali

Co.

29, Raymond F.

Evans, President,..announced that

of

Offering expected

some

time in

shares
1951

it

Hudson Gas & Electric Corp.
was

announced

shares

of

plans to issue and
preferred stock (par

company

cumulative

for

mid-November.

Scheduled for early December.
*

Central

Offering—

v

Louisiana Electric Co.,

Inc.

authorizing the creation

be

convertible

early in 1952.

into

stock)

common

late

in

Underwriter—Probably The First

Corp., New York.

Proceeds—To finance

expan¬

sion program.
Private Financing—Company also plans
to borrow before Dec. 31, 1951, the
remaining $4,000,000
under its loan agreement
Co.

with Metropolitan Life Insur¬

ance

Stainless

Steel

Corp.

Oct. 25 the stockholders approved a proposal
increasing
the authorized capital
stock to
750,000 shares from

<

' *

500,000 shares, of which 420,000 shares are outstanding.
Additional shares may be issued to stockholders, and
the

proceeds

Paso

Sept

for

used

expansion.

J. Arthur Warner & Co.

Natural

Gas

first

preferred

under¬

Co.

18 stockholders approved

thorized

Traditional

Inc., New York.

stock

shares,

increase in the

an

au¬

from

100,000 to 300,000
stock from 200,000 to

the
second
preferred
300,000 shares and the common stock from 3,800,000 to
5,000,000 shares; also authorized an increase in the ag¬
gregate principal amount of bonds issuable under the
company's indenture of mortgage, dated June 1, 1946,
from

$157,000,000 to $300,000,00. Traditional Underwriter
—White, Weld & Co., New York.
;
/
^ 1
/
Erie RR.
Oct.

8

sale

on

it

(11/27) *
that

announced

was

company

is

considering

Nov. 27 of $5,400,000 of equipment trust certifi¬

cates, maturing semi-annually over

a

10-year period, in

order to finance about 80% of the cost of

/

Oct. 10 it was reported company plans in November to
issue and sell $4,000,000 of debentures due 1971.
Under¬
writers—To be determined by competitive bidding. Prob¬
able

(to

or

Boston

El
company

on

issue of $25,000,000 preferred stock (par
$100), of
which it is planned to sell publicly not more than
120,000
an

bidders:

Halsey, Stuart & Co. Inc.; Lee Higginson
Corp., W. C. Langley & Co. and Carl M. Loeb, Rhoades
& Co. (jointly).
■

Chicago & Western Indiana RR.
2 it was reported company expects to be in the
market late this year or early in 1952 with a new issue
of approximately $70,000,000 of first mortgage bonds,
due 1981, of which about $65,000,000 will be sold ini¬
tially. Price—Not less than par. Underwriter—To be
determined by competitive bidding.
Probable bidders;
June

acquiring new
diesel locomotives and gondola cars to cost about $6,915,000. Probable bidders: Halsey, Stuart & Co Inc.; Salomon
Bros. &

Hutzler; Harris, Hall & Co. (Inc.).

Foote Bros.

Gear &

Machine Corp.
that company may offer additional common stock early next year. Probable under¬
writer—A. C. Allyn & Co., Inc., Chicago, 111.
Oct.

•

25

it

Fort

Nov.

1

•

v

Dodge, Des Moines & Southern Ry.
applied to ICC for authority to issue
$750,000 first mortgage bonds. Proceeds will
to build additional power plant facilities.
>

company

sell

and

reported

was

be used

Great

Northern

(11/13)

Ry.

Bids will be received by the company up to noon (EST)
on Nov. 13 for the purchase from it of
$16,950,000 equip¬

Halsey, Stuart & Co. Inc.; Morgan Stanley & Co.; Lee
ment trust certificates to be dated Dec. 1, 1951 and to
Higginson Corp.; Harris, Hall & Co. .(Inc.); Drexel &
mature semi-annually from June 1, 1952 to and includ¬
Co.; Kuhn, Loeb & Co. and Salomon Bros. & Hutzler
ing Dec. 1, 1966. Probable bidders: Halsey, Stuart & Co.
(jointly); Harriman Ripley & Co., Inc.; First Boston
Inc.; Salomon Bros. & Hutzler.
Corp.; Lehman Brothers; Paine, Webber, Jackson &
Hahn Aviation Products, Inc.
Curtis; Kidder, Peabody & Co.
Proceeds—To refund
Aug.\24 it was announced company proposes to offer
$49,988,000 of 4% non-callable consolidated first mort¬
gage bonds due July 1, 1952, and to redeem $13,747,000 / 12,500 additional common stock (par $1), in addition to
17,500 shares recently offered. Underwriter — None.
first and refunding mortgage 4%% bonds, series D, due
Proceeds
For engineering, acquisition of machinery
Sept. 1, 1962.
The remainder will go towards property
and other corporate purposes. Office—2636 No. Hutchin¬
improvements, etc.
son St., Philadelphia
33, Pa.
Colorado Fuel & Iron Corp.
• Hamilton
Manufacturing Co.
Sept. 26, Charles Allen, Jr., Chairman, announced that the
Oct. 30 it was reported company soon plans to issue and
company plans to issue and sell $30,000,000 of 41A% first
sell about 200,000 shares of common stock
mortgage bonds due 1972 and $10,000,000 of 15-year de¬
(par $5).
Underwriters—A. C. Allyn & Co., Inc., Chicago, 111.;
bentures. The former issue may be placed privately and
Loewi & Co., Milwaukee, Wis.
the latter issue offered publicly through Allen & Co.,
Proceeds—For working
New York. The proceeds are to be used to redeem $14,capital.
•
367,500 of outstanding first mortgage 4% bonds and the
Hycon Corp. (Calif.)
(11/12-17)
remainder used to pay for construction of a new mill at
Nov. 1 it was reported company plans to issue and sell
Pueblo, Colo. Stockholders will vote Nov. 14 on approv¬
290,000 shares of common stock.
Price—$1 per share.
ing financing program.
V
Underwriters—Gearhart, Kinnard & Otis, Inc., New

1

-

—

.

common

share. UnderwriterReynolds & Co., New York.
Proceeds—To Joseph J.
Osplack, the selling stockholder. Office—9111 Schaefer

Highway,

was

of

Nov. 7 company

writer:

Registration—Planned

&

Curtis

stated that the company plans issuance
30,000 shares of preferred stock (par $10),
each share to carry a bonus of common stock.
Under¬
writer—Ira Haupt & Co., New York. Proceeds—For ex¬
pansion program.
sale

and

Eastern

stated that the company may refund its

Underwriter—May be determined by competitive
bidding. Probable bidders: Kidder, Peabody & Co. and
Estabrook & Co. (jointly); W. C. Langley & Co.; White,
Weld & Co.;
Drexel & Co. and Stroud & Co. Inc.
(jointly). Proceeds—To refund short-term indebtedness.

stock

$6.75

on

$100).

capital.

stock

(EST)

writer: Lehman Brothers.

10 shares

amendment.

per

a.m.

is contemplating sale
of
additional
common
stock
following approval of
3-for-l stock split (approved Sept. 5.) Traditional under¬

held; rights to expire Nov. 21.
Mass.

was

Bing & Bing, Inc.
Aug. 30 it was reported

—

/'

stock

share for each

one

to 11

up

November. //

(Ohio)

filed 364,727 shares

received

The First Boston Corp.

,

balance

be

outstanding $22,388,000 first consolidated mortgage 4%
bonds due July 1, 1952. Probable bidders: Halsey, Stuart
& Co. Inc.; Morgan Stanley & Co.; Kuhn, Loeb & Co.;

(nonpar). Price—To be supplied by amend¬
&

will

Sept. 14 it

pre¬

Underwriters—Paine, Webber, Jackson & Curtie

Stone

Beverage Corp., New Haven, Conn.

Aug. 22 it

Atlantic Coast Line RR.

Southwestern Associated Telephone Co.
June

output of company's eight divisions.

stockholders will vote Nov. 15

Silver Buckie

ferred stock

$10,000,000 of preferred stock.
Underwriter—A.
Allyn & Co., Inc., New York. Proceeds—To retire
present outstanding 5% preferred stock and to expand
C.

Oct.

rights

share.

per

Corp.

^ Denver & Rio Grande Western RR.

.

Boats, Jnc., Costa Mesa, Calif.
Oct. 10 (letter of notification) 300,000 shares of common
stock. Price—At par ($1 per share). Underwriter—None.
Proceeds
For purchase of building and property and
for working capital.

to expire Nov. 30.
Underwriter—None.
Proceeds—

Price—$5
For

shares

working capital.

Wizard

(no par), to be offered for subscription by com¬
stockholders of record Nov. 13 at rate of one share

mon

for

ceeds—For

Grocers

stated company plans issuance and sale of

was

about

Cott

Sept. 13 (letter of notification) 165,250 shares of common
stock (of which 82,625 shares represent stock to be issued
on exercise of
stock purchase warrants issued in con¬
nection with sale of 110,000 shares on or about Oct. 24).
Price—At par ($1 per share). Underwriter—None. Pro¬

Seattle Steam

Oct.

Oct. 8 it

Wilcox-Gay Corp., Charlotte, Mich.

struction program.

stock."

Consolidated

,

Price—$20 per share.
Underwriter—None.
Proceeds—
For financing expansion program.
Office—1108 Lavaca
Street, Austin, Tex.

Sept. 21 filed $6,000,000 of first mortgage bonds, series D
Stuart

A. Hogle & Co.; Shields &
Co.; Walston, Hoffman &
Goodwin; Wegener & Daly Corp. Proceeds—For addi¬
tional working capital and for new equipment.

share for each two shares held.

one

41

J.

Western Reserve Life Insurance Co.

of $100. Underwriter—Cohu & Co., New York.
Proceeds
—To retire debts and purchase building. Office—2 East
Church St., Frederick, Md.

due 1981.

(1781)

,

Colorado

Interstate Gas

Co.

reported that the holdings of the UnioD
Securities Corp. group of stock of Colorado Interstate
(531,250 shares) will probably be sold publicly in Octo¬

Aug. 20 it

was

York, and White & Co., St. Louis, Mo.
working capital.
Business—Electronics.

Proceeds—For

Illinois Bell Telephone Co.
27 W. V. Kahler, President,

June

and

announced that thia
99.31% owned by American
Telephone & Telegraph Co.) plans issuance and sale,
sometime before the end of the year, of 682,454 addi¬
tional shares of capital stock to its stockholders. Under¬
writer—None. Proceeds—To repay short-term loans and

1981

for

ber

or

November.

Consolidated

(approximately

company

Edison Co.

of New York,

Inc.

March 23 company applied to New York P. S. Commis¬
sion for authority to issue and sell $25,000,000 of first

refunding mortgage bonds, series H, due May 1,
(in addition to $40,000,000 series G bonds filed with
the SEC on March 30). Underwriters—To be determined
by competitive bidding. Probable bidders: Halsey, Stu¬
art & Co. Inc.: Morgan Stanley & Co.; The First Boston
Corp.; Merrill Lynch, Pierce, Fenner & Beane and White,
Weld
&
Co. (jointly).
Proceeds — To redeem a likf
amount of Westchester Lighting Co. 3%% general mort¬
gage bonds due 1967. Offering—Postponed.
1
4

new

construction.

Interstate

Oct.

11

and sell

—To be

Inc.*

(11/9-13)
company applied to ICC for authority to issue
100,000 shares of common stock (par $5). Price
supplied later. Underwriters—Blyth & Co. Inc.;

Co.

was

writer—White, Weld & Co., New York.
Iowa-Illinois
Oct. 8 it

was

issuance

4-Consolidated Freightways,

Petroleum

reported that the sale of 38,433 shares of
class B stock has been temporarily postponed.
Under¬
Sept. 11 it

and

Gas

•

,

.

& Electric Co.

announced that the company contemplates

sale

over

the next

three years

of about

$6,000,000
issue of about $12,000,000 in first

60,000 shares of preferred stock (par $100) or
in

debentures; also an

Continued

on

page

42

,

42

The Commercial and Financial Chronicle

(1782)

Continued

jrom

41

page

mortgage bonds.
Underwriters—For bonds, to be deter¬
mined by competitive bidding. Probable bidders: Halsey,
Stuart & Co. Inc.; Harriman Ripley & Co., Inc., Union
Securities Corp. and White, Weld & Co. (jointly); Equit¬
able Securities Corp.; Glore, Forgan & Co.; Harris, Hall
& Co. (Inc.); Lehman Brothers; Blyth & Co.; The First
Boston Corp.; Smith, Barney & Co.
The following may
bid for preferred stock: Blyth & Co., Inc.; Merrill Lynch,
Pierce, Fenner & Beane; Kidder, Peabody & Co., in addi¬
tion to those mentioned as probable bidders for the

Parkersburg Rig & Reel Co.
Aug. 1 A. Sidney Knowles, Chairman and President, an¬
nounced that the directors have approved in principle a
plan to offer a modest amount (not exceeding $300,000)
of common stock for subscription by common stockhold¬
ers.
This may involve the issuance of 24,700 additional
shares on a one-for-eight basis. There are presently out¬
standing 197,600 shares of $1 par value. Probable Under¬
writer—H. M. Byllesby & Co., Chicago, 111. Proceeds—
For working capital.
■

.

Thursday, November 8, 1951

.

Seaboard Air Line RR.

(11/8)

Bids will be received up to noon

(EST)

Nov. 8 by

on

the company at the office of Willkie Owen Farr Gallag¬
her & Walton, 15 Broad St., New York 5, N. Y„ for the

purchase

the

from

trust certificates

to mature

of

company

$8,070,000

equipment

series K, to be dated Nov. 15, 1951 and

serially in 30 equal semi-annual instalments.
Halsey, Stuart & Co. Inc.; Salomon

Probable

bidders:

Bros. & Hutzler.
& Western

Seaboard

Pennsylvania Water & Power Co.
July 25, stockholders approved issuance of 78,507 shares
bonds, with the exception of Halsey, Stuart & Co. Inc.
of cumulative preferred stock (par $100). Proceeds will
Proceeds from the sale of the preferred stock or deben¬
V be used for expansion program.
tures (probably late this year) will be used to retire a
Aug. 7, it was reported company may issue and sell
$6,000,000 bank loan used to finance, in part, the com$8,000,000 to $10,000,000 of first mortgage bonds. Prob¬
pany's construction program.
able bidders may include: Halsey, Stuart & Co. Inc.;
Lehman Brothers; White, Weld & Co. Proceeds wSfobe*
• Kellogg Co., Battle Creek, Mich.

.

Oct.

it

19

Airlines,

Inc.

that company plans financing
totaling $6,500,000 to $7,000,000 for purchase of n£w
equipment. May be placed privately.
reported

was

^

*

'

Kellogg Foundation (said to be
outstanding $1 par stock)

it was reported

Oct. 30

the owner of about 50% of the

of

dispose

may

of its

some

holdings.

Underwriter—

Probably Morgan Stanley & Co., New York.

Lehigh & New England RR.
will

Bids
123

be

received

Broad

So.

by

the

(11/19)
at Room 2001,
9, Pa., up to noon

company

Philadelphia

Street,

(EST) on Nov. 19 for the purchase from it of $1,875,000
equipment trust certificates, series M, to mature in 15
equal annual instalments. Probable bidders: Halsey,
Stuart & Co. Inc., Salomon Bros. & Hutzler.
Lehmann

(i. M.)

Philadelphia Electric Co.
Sept. 30 company announced that about $200,000,000 will
have to be raised through the sale of additional secur¬
ities, spaced at intervals, and in amounts which
permit ready absorption by the investment market.

Sept. 1 it was reported that the Office of Alien Property
expects to call for bids in October on all of the out¬
standing stock of this corporation.

has already cost $217,000.000, and will require expenditures of about $365,000,000
•

in

the years

Pioneer
it

31

Air
was

Oct. 25 it

with and

was

sufficient

raise

$800,000.

Underwriters:

Hickman

and

First

to

into this company of

Mathieson Hydrocarbon

intention of the company to
of new pre¬
ferred stock on terms to be set at a later date. The pro¬
ceeds will be added to working capital and used for
research and product development.
Chemical

sell

a

Corp.,

it is the

substantial portion of 250,000 shares

McKesson &

Robbins,

it Pittsburgh &

to

$700,000

(11/15)

RR.

certificates
ders:

to

mature

in: l-to-15

years.

Probable bid¬

Halsey, Stuart & Co. Inc.; Salomon Bros. & Hutzler.

Pittsburgh Steel Co.
it

11

was

announced stockholders will vote Dec.

5

increasing authorized 5V2% prior preferred stock,
first series,
from 225,927 to 400,000 shares and the
authorized common stock from
1,500,000 to 2,500,000
shares. Traditional Underwriters—Kuhn, Loeb & Co.

Mengel Co.
Aug. 10, Alvan A. Voit, President, stated that the com¬
pany plans to spend from $15,000,000 to $20,000,000 for
expansion, but that plans for financing have not yet
been completed. Traditional underwriter—F. S. Moseley

approved

a

& Co.

Oct. 23 it
on

Public Service Co. of New Hampshire

stock

bidders:

Kidder, Peabody & Co. and Blyth & Co. Inc.

was

announced stockholders will'vote Jan. 15,

approving the creation of an authorized issue of

For expansion program.

Public Service Co. of North Carolina, Inc.
July 12 it was announced company plans to issue and
sell several million dollars of first mortgage bonds in
the Fall.
In July last year, $1,200,000 of bonds were
placed privately with two institutional investors.

Metals & Chemicals Corp., Dallas, Tex.

(11/1S)
Oct. 3 it was stated company plans issue and sale of 100,000 shares of common stock. Price—$3 per share. Under¬
writers—Beer & Co. and Binford, Dunlap & Reed, both
of Dallas, Texas, and Stuart M. Wyeth Co. of Phila¬
delphia, Pa. Proceeds—For working capital, etc.
/

Purex
Oct.

Power Co.
Sept. 6 it was reported that company plans to sell about
50,000 shares of preferred stock this Fall. Underwriters—
To be determined by competitive bidding. Probable bid¬
ders: Lehman Brothers; Equitable Securities Corp. and
Carl M. Loeb, Rhoades & Co. (jointly); The First Boston
Corp.; Merill Lynch, Pierce, Fenner & Beane; Kidder,
Peabody & Co.; The First Boston Corp.; W. C. Langley
8c Co.; Harriman Ripley & Co., Inc. Proceeds—To repay

New York Central RR.

/

(11/21)

Oct. 17 it

was reported company plans sale of $8,100,000
equipment trust certificates. Probable bidders: Halsey,
Stuart & Co. Inc.; Salomon*Bros. & Hutzler. Bids—Ex¬
pected to be received Nov. 21.

was

announced that company

anticipates that
permanent financing will be undertaken early in 1952
in order to repay $35,000,000 bank loans.
No definite
plans for such financing have been formulated. Under¬
writers—To be determined by competitive bidding, if
bonds.

Probable bidders:
Halsey, Stuart & Co. Inc.;
Morgan Stanley & Co.; Kuhn, Loeb & Co.; The First
Boston Corp.
Merrill Lynch, Pierce, Fenner & Beane
may bid for common stock if same is to be issued.;/
•

Northern States Power Co.

(Minn.)

Oct.

^25 it was announced company estimates that ap¬
proximately $32,500,000 of new money will be required
to finance its construction program for 1951 and 1952
through the sale next year of common stock, and senior
securities.

Probable bidders for stock and bonds:

Smith,

Barney & Co.; The First Boston Corp.; Glore, Forgan
& Co.; Lehman Brothers and Riter & Co.
(jointly);
Equitable Securities Corp.; Union Securities Corp.; Mer¬
rill Lynch, Pierce, Fenner & Beane; Kidder, Peabody
& Co. and White, Weld & Co. (jointly).
Probable bidder
on bonds only:
Halsey, Stuart & Co. Inc.
Olsen, Inc., Elyria, O.
Oct.

19 it

was

about, 225,000
McDonald

selling

reported early registration is planned of
shares of common stock. Underwriter—

&

Co., Cleveland, O. Proceeds}—To certain
stockholders.
Business—Manufactures hot air

furnaces.

Offering—Expected in November.




voted

to

increase

the

stock

to

Rochester Gas

& Electric Corp.

:

Aug. 1 it was announced that company

combination thereof, in connection
with its construction program. The method of obtaining
such additional cash requirement has not been deter¬
mined.

Probable

bidders:

Southern California Edison Co.

Aug. 29 it

was

announced

may

company

or some

Previous bond financing was done privately.

refunding mortgage bonds which were sold last week.
The nature, amounts and timing of the new financing
now be determined, and will depend in part on
market conditions existing from time to time and riiay
include temporary bank loans.
\
Southern California Gas Co.

April 4, the

company indicated
with $18,000,000 of

the market

able

it would this year be in
senior securities. Prob¬

bidders:

Halsey, Stuart & Co. Inc.; Blyth & Co.,
Inc.; White, Weld & Co.; Lehman Brothers; Merrill
Lynch, Pierce, Fenner & Beane and Harris, Hall 8c Co.
(Inc.) (jointly).
Offering—Expected in the Fall.
V
i

Southern

July 31 it

Natural

Gas

Co.

has filed an applica¬
permission to construct additional
facilities to cost an estimated $13,641,000, of which ap¬
proximately $9,187,000 is expected to be spent in 1951.
tion

was announced company

with

FPC

for

Texas-Ohio Gas
Oct.

17

struct

Co., Houston, Tex. '
applied to FPC for authority to cdn1,350-mile natural gas transmission line extend¬

company

a

ing from Texas into West Virginia.
mated to cost $184,989,683.
r
•

Texas Pacific

Nov. 5 it
of

The project is esti¬
-

Land Trust

_""

Royal Typewriter Co., Inc.
announced stockholders will vote Nov. 14

authorized

planned.

stock to 2,000,000'
No immediate financing is

common

shares from 1,078,816 shares.

•

duced

reported that secondary offering of 55,^00
(par $1) was planned.
This may be re¬
30,000 shares.
Price—To be announced later.
was

to

Underwriters—Clark, Dodge & Co. and The First Boston
Corp., New York. Proceeds—To United States Smelting,
Refining & Mining Co., the selling stockholder.
J
Texas &
Oct. 17 it

Pacific

(12/6)

Ry.

-

1,000,000 shares in order to place it in a position to
appropriate financing of some form of its own securi¬
ties if and when advantageous to the company. The new
financing may take the form of a general offering for
sale to the public or granting of rights to stockholders;
or the reservation for conversion of
long-term indebt¬
edness which could be issued with provision for con¬
vertibility into common stock. The company presently
has outstanding 439,193 shares of capital stock, of which
45,350 shares are held by the wholly owned subsidiary,
Ryan School of Aeronautics.

Schering Corp.
was

->•.

reported company plans sale of $2,900,000
equipment trust certificates, series N. Probable bidders:
was

Halsey, Stuart & Co. Inc.; Salomon Bros.
Bids—Expected to be received Dec. 6.
v

&

Hutzler.

Texas Utilities Co.

Sept. 24 it
around

in

was

reported

company

400,000 additional shares of

1952.

Probable

bidders:

The

may

issue and

common

First Boston

sell

stock eai;ly

Corp, and

Blyth & Co., Inc. (jointly); Union Securities Corp.;
Lehman Brothers and Bear, Stearns & Co. (jointly);
Goldman, Sachs & Co. and Harriman Ripley & Co. Inc.
(jointly); Kidder, Peabody & Co. and Merrill Lynch,
Pierce, Fenner & Beane (jointly).

Carolina

Utilities

$1,500,000

on

Commission

3%

notes.

for

applied to the
permission to

These notes would "be

refunded through the sale of common or preferred stock.
Traditional underwriters:
Union Securities Corp. and
W. C.

Langley & Co., New York.

Proceeds from notes to
* v j.
*

be used to pay for construction costs.
•

do

tire

p

,,

\i •"

■

■

Ryan Aeronautical Co., San Diego, Calif.
Aug. 4 it was announced company plans to increase
its authorized capital stock (par $1) from 500,000 to

Oct 3 it

►

sub-shares

borrow

increasing

The First

Blyth & Co., Inc.;

& Co.;

Boston Corp. and Harris, Hall & Co., Inc. (jointly). These
bankers bid for the $30,000,000 issue of 3Ys% first and

North

for the next two years.

was

have to raise

$49,900,000 more through additional fi¬
nancing to take care of its 1951-1952 construction pro¬
gram. Probable bidders for bonds: Halsey, Stuart & Co.

approximately

July 18, it was reported that the company expects to
raise money through the sale of some preferred stock
later this year. Underwriter—Probably The First Boston
Tide Water Power Co.
Corp., New York. Proceeds—To finance, in part, a $10,- V
Sept. 17 it was reported company has
000,000 construction program the company has budgeted

Oct. 19 it

Stuart-&

Halsey,

first mortgage bonds and repay outstanding short-term
bank notes which are due before the end of the year.

expects to issue

$5,000,000 additional first mortgage bonds and additional .
debt securities or preferred or common stocks, bank '■*

borrowings,

Smith, * President, announced company
more than $8,000,000 by fall of
Underwriters—May be determined by com¬

Co. Inc.; Lehman Brothers; Blyth & Co., Inc. Proceeds—
To refund the presently outstanding $4,000,000 of 4%%

authorized

1,000,000 shares from 500,000 shares.
Traditional underwriters: Blyth & Co., Inc., New York;
William R. Staats & Co., Inc., Los Angeles, Calif.

on

Niagara Mohawk Power Corp.

Oct. 26 it

Corp., Ltd.
stockholders

25

common

New England

bank loans and for construction program.

Corp.; Harriman Ripley &

Co. Inc.

100,000 shares of convertible preferred stock (par $50).
Underwriter—Carl M. Loeb, Rhoades & Co. Proceeds—

•

it was reported company may issue and sell
150,000 to 200,000 shares of additional
sufficient to raise $5,000,000.
Probable

common

(jointly); The First Boston

Merritt-Chapman & Scott Corp.
1952

on

Sept. 25,

Earl

bond issue of

a

this year.

late in November

stockholders

23

v

:

by the company at 466 Lexington

proposal to increase
authorized common stock by 500,000 shares to 2,500,000
shares.
No immediate financing contemplated.
Prob¬
able underwriter: Goldman, Sachs & Co., New York.
Oct.

: ;

cannot

Avenue, New York, N. Y., until noon (EST) on Nov. 15
for
the purchase
from it $6,435,000 equipment trust

Oct.

Inc.

about

Houston, Tex.

Lake Erie

24

plans

Inc.; Kuhn, Loeb

issue addi¬

Southwest Co., both of Dallas, Tex,;

be received

Bids will

may

Probably Schneider, Bernet &

Corp.

announced that following proposed merger

*

Dallas, Tex.
company

securities

tional

1951 to 1956.

Lines, Inc.,
reported that

and Chas. B. White & Co. of

Mathieson Chemical

I

will
The

overall construction program

more

April

Financing not considered,. petitive bidding.

expansion program.

imminent.

Oct.

(N. J.)

Co.

used for

5"/; South Jersey Gas Co.

reported that the sale of the company's en¬

stock issue (440,000 shares) was not ex¬
pected for at least two months. The sale will be made
to the highest bidder by the Office of Alien
Property.
common

Transcon

Oct.

31

it

Lines, Los Angeles, Calif.

reported company may be considering
issuance and sale of 30,000 shares of common stock (Jar
was

$10).
Los

Underwriter—Probably Floyd A. Allen & Co., Inc.,
Angeles, Calif.

United Gas Corp.
Aug. 1, N. C, McGowan, President, announced that "it
will be necessary to arrange for an additional
$50,000,000
to complete the total financing, and it is
presently antici¬

pated this will be done by the sale of first mortgage and
collateral trust bonds during the.latter part of the year."
Underwriters—To be determined by competitive bidding.
Bidders for

an issue of like amount sold on
July 24 were
Halsey, Stuart & Co. Inc.; Morgan Stanley & Co., White,
Weld & Co. and Equitable Securities
Corp. (jointly);
The First Boston Corp., Harriman
Ripley & Co., Inc., and
Goldman, Sachs & Co. (jointly). Proceeds—For expan¬
sion program of United Gas System and for other
corpo¬

rate purposes.

Van Norman Co.

Probable bidders: A. G. Becker & Co.
(Inc.), Union Se¬

Oct.

curities Corp. and Ladenburg, Thalmann & Co. (jointly);
Merrill Lynch, Pierce, Fenner & Beane; Kidder, Peabody

sell

Co.; F. Eberstadt & Co.; Allen & Co.; new company
formed by United States & International Securities Corp.,

per annum.

ing authorized

Dillon, Read & Co.; F. S. Moseley 8c Co.; Riter & Co,

shares of

;

tures to bear interest at

&

tea**

18

to

it

was

announced

company

plans to issue and

public $2,500,000 of 20-year convertible deben¬
a rate between 3Va% and 4%%
Stockholders will vote Nov. 15 on increas¬

common

common

stock by an

stock and

on

additional 200,000

authorizing-issuance?of

u

Number 5062

Volume 174

.

.

The Commercial and Financial Chronicle

.

(1783)

ajl

part of such increased shares by the directors

or any

without

Bids—Expected

program.

prior

offering to stockholders- Underwriter—
Paine, Webber, Jackson & Curtis, Boston, Mass. Proceeds
—For working capital.

be

to

.

opened

•

^Western Maryland Ry.

Vertientes-Camaguey Sugar Co.

(11/15)
company

due

authorizing the sale of 481,307 "additional shares of
stock to present stockholders at rate of one
s^hare for each two shares held. Price—At par ($6.50 per
on

Virginia Electric & Power Co.

Sept. 25, Jack G.
company

and

termined

Palsey,

by

Bids

to issue and sell $20,000,000 of

proposes

competitive

Co.

Stuart &
Webster

Inc.;

Salomon

Securities

Stone

&

Corp.;

Probable

White, Weld & Co.

Bros.

Corp.;

first

Edison

on

Hutzler;

Co.

Four

of

will

has

banking

organized

been

usual

right is

when

one

to

the

groups

seek

that

$40,000,000
i

The investment world is "sing¬

this

Seveial
due

add

to

prevailing woes, as
though these of themselves were
not enough/ there is a
growing
disposition on the part of some

j

Power

'these

/7/.-7/7'"7'

go.

The

weight

./•. y?.

leaves its mark.
overs

been

carried

"weeks.

:

j '

along

for

"are

complaint

in

The
-is

gratifying.

especially
mood

no

disturbed

weighty

a

is

to

bit

Every

important,

as

Los

this

/.

;

.writers

and

to

sit

how-

,the

the

over

newest

keenly
bite

tax

aware

the rank and file

moment

«clined to do little

■$

in

Reports
that

1

the

the

Street

thority is just about ready to go
through with its huge refinancing
It is expected that this

program.

!

big operation will be in the works
; within

a

week

ten days.

or

ferred

and

in

are

DIVIDEND NOTICES
St.

bid

will

Louis,

&

Fewel

comments

number

a

CAN
COMMON

1,

for

On

—

South

of

mon

October

not

Savings
&

Co.,

Bank

453

of

'v'

7

Los

South

1951

30,

pre¬

December

on

in

on

"Local

Note"

Pittsburgh,

TECHNICAL OIL FIELD SERVICES

LANE-WELLS
COMPANY

Dividend Notice

Secretary

South
:

are

Main

clared

common

—

quar¬
an

share
stock, payable De¬

1951,

stockholders

to

of record November
21, 1951.

WILLIAM

A.

MILLER

of

record
ness

declared

cents

(50c)
also

Common

ber

extra

an

per

Common

Corporation,

share

payable

close

the

at

December 1, 1951.

on

Board

Stock,

the

December 22, 1951,
stockholders of

of

busi¬

the

Common
22, 1951, to

December

stockholders

of

In addition, the
dividend of fifty

on

record

NATIONAL

CORPORATION

.

S.

A.

CAN

Decem¬

on

1951.

l,

McCASKEY,

Jr.

Secretary

DIVIDEND
The

Bocrd

clared

Com-

(15c)

a

per

of the

of

Directors

dividend

share

on

of

today

fifteen

de¬
cents

the Common Stock

Company, payable December

14, 1951, to stockholders of record
at the close of business November

same

]95h

Products

/">

407

7

THE DAYTON POWER

7

and President

November 2, 1 951.

ADD LIGHT COMPANY

Montgomery
7;;

DAYTON, OHIO

bulletin —The

117th Common Dividend

Bankers

&

Co.,

•

The Board of Directors has declared
a

regular quarterly dividend of 50c
the Common Stock of

share

the

120

Company, payable

on

ber 1, 1951

are memoranda

ord

at

on

Decem¬

to stockholders of rec¬

the

dose

of

business

&

Co.,

30

Broad

HI

PEPPERELI
MANUFACTURI
COMPANY
Boston, November 1+1

on

A regular quarterly dividend of. Seventy
Cents (75^) and an extra dividend of Fifty C

November 14, 1951.
GEORGE SELLERS, Secretary

.November 2, 1951

>

lppPE|t&LL]

(50^)

per

share have been declared

Checks will be mailed by the Old Colo;.,
Trust Company of Boston, Dividend Disburs¬
ing Agents.
Paul E. Crocker, Secretary
160 State Street, Boston, Mass.

THE FLINTK0TE COMPANY

Limited—Analysis—John R. Lewis, Inc.,
Avenue, Seattle 4, Wash.

,/
r

ing

bonds

which

would

be

due

I 'I from 1957 through 19S9.
Two

r

;

stood

groups are under-

be in

the field for this

i

business

,

Authority to consolidate its out-

U;standing
V

which

will

debt

Tube Corporation—Circular—Aetna Securities
poration, 111 Broadway, New York 6, N. Y.

Riverside

banking
to

Reading

enable

represented

the

by

three separate issues.

Cement

Corporate Market

Provided there is

T

;

change in
the plans of the prospective issuer,
the new corporate bond market
appears likely to experience a test
of

its

absorbtion

no

powers

next

week..
Bids

are

due

$40,000,000 of

up

new

Wednesday
general and




of $1.00 per

declared

been

holders of record at the

A

on

the

DIVIDEND NOTICE

South

Chicago 4, 111.

King Railway.

available

7

is

on

of

La

,l|*.

Co., 148 State Street,

information

per

the

Thermo

close of busi¬

end

record

10,

dividend

Stock
close

1951,

the

regular quarterly dividend
of 50 cents per share and a
special dividend of 25 cents
per share on the common
stock ($10 par value), both
payable December 1,1951, to
stockholders of record
November* 15, 1951.

of

payable

1951, to stockholders
the

at

October 24,

Board of Directors declared
a

share have been declared

November 26,
.

On

1951.

year

a

Common

December

Company—Analysis—Cruttenden & Co., 209

Also

and

on

stock¬

quarterly dividend of $.50 per

$1.00

Company—Analysis—Bruns, Norrie-

Co., 60 Beaver Street, New York 4, N. Y.

9, Mass.

December 1,

share

U. S. Thermo Control—Data—Raymond &

funding 25-year bonds of Detroit

has

payable December 15, 1951 to

Corporation—Analysis—Van Alstyne, Noel & Co.,

Street, New York 5, N. Y.

Salle Street,

Boston

dividend

quarterly

ness

Tide Water Associated Oil

Trane

A

$4Cumulative Preferred Stock

Company—Analysis—Genesee Valley Securities Co.,
Powers Building, Rochester
14, N. Y.

&

FINANCE CORPORATION

share

on
re¬

&

Seneca Oil

man

29,

H.Y.

PACIFIC

memorandum—Lerner

Falls Machine Co.

52 Wall

NLW YCRK

30 ROCKEFELLER
PLAZA

Co., 10 Post Office Square, Boston 9, Mass. Also available is
a memorandum on Gear
Grinding Machine Co. and on Seneca

Studebaker
Test

Company—Card

Cor¬

of

business

1951.

CLIFTON W. GREGG,
b. c. Reynolds,

Vice-President and Treasurer
0

November 7, 1951

pay.

November 15, 1951, to stockholders of recorc
the close of business November 8, 1951.

Development
Second

30,

C. L. THOMPSON
Chairman of the Board

Co.,

Newborg

a

and

per

Common

analysis of Equity Oil and Utah Southern Oil.
—

15,

cents

cents

Secretary-Treasurer

the

on

Stock
1o

Supply^Analysis—Edward L. Burton & Co., 160
Street, Salt Lake City 1, Utah. Also available

Petroleum
Analysis
Street, New York 4, N. Y.

Placer

the

Penna.

payable

& Co., Incor¬

Utilities—Memorandum—Josephthal

Phillips

dividend of 20

meeting of the Board of Directors
the Allegheny Ludlum Steel Corporation
held today, October 30, 1951,
a
dividend
of
fifty cents
»(50c)
per1
share
was
de¬

of

New

Mountain Fuel

1*111

Treasurer.

of
the Com¬

"Highlights"—Troster, Singer &

&

BONNYMAN,

a

Street,

Also in the

L.

terly dividend of 30

Angeles-

Purolator

pay¬

books

Transfer

December

special dividend

a

;Wv y"7Vp-7;-'

Jacob

1951.

1,

The Directors have declared

At

v

and

Co.

108

COMPANY

EDMUND HOFFMAN,

Reitzel,

Spring

NO.

be closed.

IS, 1951 to Stockholders of record at the close
business November 21, 1951. Transfer books
remain open. Checks will be mailed.

equity deals
calandar,
but these

:

Pacific

&

DIVIDEND

will

York State Electric &
Gas, Niagara Mohawk Power,
Portland Gas & Coke, Scranton
Electric, and South Carolina
Electric & Gas.
.7
on

STOCK

STOCK

dollar per share was declared on
Stock of this Company, payable

one

common

the

Corporation—Analysis—Amott, Baker

Securities

Rocky Mountain

The above company has declared a dividend
of Fifty Cents per share on the Common Stock
of the Company to stockholders of record at
the close of business November 15,

AMERICAN

per

1006

It calls for the flotation of some
7 $210,000,000 of new serial refund-

stock

of

Meanwhile

Broadway, New York 5, N. Y. Also available

Au-

■

the

DIVIDEND NOTICES

Co.

this offering.

Foods,

Middle

indicate

Bridge

Triborough

if

anything in the

P.

Co., Inc., Kentucky Home Life Building, Louisville 2,
Kentucky.

Big Triborough Deal

i

back

1951,

maturing Oct.

groups

Inc.; Th«

Raton, New Mexico, November 1, 1951.

similar

a

Co.

(Inc.); Kiddei

Hutzler; Union Securities Corp.; Merrill Lynch

able

Bond

holdings are concerned.

»

Three

Ruppert,
and Safety Car Heating &
Lighting.

Kentucky

where their particular

means

debt

of

;just what the Revenue Act of 1951

?

of

bonds, probabli
&

Corp.; Harris, Hall & Co.

fresh blow.

week

Railway

bonds to refinance

If

Halsey, Stuart

COMMON

certifi¬

next

Maryland

plam

Pierce, Fenner & Beane; Shields & Co.

set

a

open bids on $14,950,000
of
25-year series B general mort¬

Inc.—Brochure—Sutro
Street, San Francisco 4, Calif.

I itime and endeavor to determine
I.

are

in-

are

of

porated, 150 Broadway, New York 38, N. Y. "

than mark

more

issue

the

for

and

Bros. &

be

of

power

Method of permanent financ

cember

Trust

—

Forge—Comment

Hunt

individuals

and

quite

are

Thursday

Corporation—Analysis—Sincere
231 South La Salle Street, Chicago 4, 111.

Grinnell

created tax situation.

Institutions
alike

look

and

On

Co., 74 Trinity Place, New York 4, N. Y.
.

dealers, is the rather

back

newly

Boston

market encounters
way

include:

of this type in some weeks.

Petroleum

pany,

judging

/ widespread tendency of investors
'

$12,000,000 steam turbine

a

County, Wis.

on

Angeles 13, Calif.

Cosden

from the run-ofthe-mine reports reaching under-

■

National

Memorandum

Erie
.ever,

trust

Vermont

Citizens

situation

^reticence, of course, but the inter¬
national picture is not such
as
'
-promotes confidence.

the

on

basis,

Peabody & Co.; Carl M. Loeb, Rhoades & Co.; Salomoi

ex¬

secu¬

could

l-for-3

a

Kohlepp, President, announced company

of the largest offerings

one

1952.

scheduled to

E.

$16,900,000

Public Service Co.—Analysis—Ira
Haupt &
Co., Ill Broadway, New York 6, N. Y.

The

behind

equipment

new

debt

undetermined

are

Railway

day will market

Soya

Central

business."

do

factor

•

that people

market

of

$10,000,000

on

Co., Inc.—Bulletin—Remer, Mitchell &
Inc., 208 South La Salle Street, Chicago 4, III.
V

many

Meantime the general picture is

not

Central

/</' y 7

.general

$296,000,000

a

sale

plans

$500,000,000

Recommendations and Literature

Some of the left¬

.

Co.

to

Dealer-Broker Investment

in

.being worked off have

now

Company

bids Tuesday

gage

Tap

C.

Allegheny Ludlum Steel Corporation

•

selling

this

of

on

4

First

same

will

$50,000,000 deals.

Light

Sept.

plans to build

authorized

new

the

smaller

&

1952.

(EST)

Continued jrom
page 8

>n already thin market naturally

r

into

up

on

not yet been determined.

indebtedness

offer for

Underwriter—Loewi

may

Western

priced

are

$1)

to

51,667 additional

Wisconsin Public Service Corp.

extra

people who have been lugging unsold portions of new issues to let

|

handling
$15,000-

(par

bidders

open

of

stock

common

oversubscription privilege.

an

plans

stockholders

common

Co., Milwaukee, Wis.

like

1,

of

Inc.

company

ing has

cates,

pieces of new
the bond market are
next week with
Florida

out

&

Co.;

a

a.m.

of 30-year first mortgage bonds.

financing via

to cheerfulness.

To

and

with

the

announced stockholders will vote Dec. 14

was

amount

7 without some justification. Cur7 rently the market is not conducive

...

get

Other Issues

ing the blues" these days and not

-

and

they

you

Oct.

11:30

type and amount of which

thing, but it's another

when

at

&

retire

bonds due

received

be

Stanley

stated

was

in Marathon

program.

interest since it

observed

issues

field

mortgage

to

Great Northern

than

Morgan

Proceeds—To

$150,000,000 in connection with

pansion
rities

$5,000,000, $10,000,000
000

first

increasing

underwriting
fraternity
watching this one with

be

more

Co.;

&

Hutzler.

it

shares

by

15.

business.
The

4%

determined

30

subscription by

Probable bidders: Halsey, Stuart &

Loeb
&

Expected

—

from

Securities

been

Underwriters—To be

Wisconsin Central Airlines,

Oct.

issue

Westinghouse Electric Corp.

Proceeds—For construction

have

Kuhn,

Sept. 26, it

bidders:

&

Union

1976.

Bros.

Nov.

on

Underwriter—To be de¬

bidding.

Inc.;

amount

Holtzclaw, President, announced the

refunding mortgage bonds.

1,

Salomon

(12/10)

to

proposes

$14,950,000 of general mortgage bonds, series B,

Nov.

Co.

Underwriter—

'

-

announced

was

competitive bidding.

common

.

it

30

and sell

Oct. 22, it was announced stockholders will vote Nov. 27

None.

(may be private). Traditional underwriter: Kuhn, Loeb
Co., New York.

&

Oct.

Proceeds—For working capital.

about

or

Dec. 10.

.

share).

on

43

0

Secretary

Financial Chronicle

The Commercial and
44

.

Thursday, November 8, 1951

..

(1784)
whom the opposition to Taft can
coalesce so long as Eisenhower is

.

BUSINESS BUZZ

possibility. And Eisenhower is
the
leading personal rival

a

also

on

(that is, of course, if he has any
nomination).

•

I

•

interest in the

early announcement thus

Taft's

yf

Behind-the-Scene Interpretations
from the Nation's

Capital

gJ

y*

m/

XJLgwtA/

■,

*

action from developing. So long as

CrCv

Eisen¬
and
Saltonstalls, et. al., cannot find
is

there

the

controlled.

cold awaken¬

fcas vanished in the

experimental "guinea pig" farms
all over the

fighting

'

A

The

IU1

of problems

Roast Beef
—

in

Brannan

•■•"■.Brannan

apparently
referring to

■/■

well

m

ten easy

at

not

is

,

;

;

profitable operation.

latory powers, it is not

not

is

incidentally,

This,

the

visible to

microscope-equipped eye.

the

-K>

a

limit

on

the dollar payments

Be

also

like

doesn't

such

a

150,000 persons. Usually, but not
invariably, ; these committeemen

there

are

Throughout the report
other instances which
the suc¬
kulaks whose

hint that Charley regards

cessful

farmers

as

liquidation would be in the social

unsuccessful

Interest, leaving the
farmers

his sole wards.

as

These

committeemen,

mous

only

of

ing

A—Production

and

Market¬

Administration,
Farmers
Administration, extension

Home

workers, Forest Service, et al., ad

infinitum, were supposed to retail
few of
the powers the virtues of the "Familj Farm
sought by Brannan can be listed Policy Review" to the farmers.
In any reasonable space. He would They held at least one meeting in
'set up a new Federal system of every farm county, even if D of A
•intermediate
term
loans
(there bureaucracy often constituted half
is already one such under his de¬ or more of the attendance at the

Only

a

partment) to take care of needs
too
heavy to be financed with
:o of A

short-term

guys.

meetings.

written

Instructions

by

C.

J.

McCormick, the Under Secretary
light to be financed with D of A of Agriculture, were that these
long-term credits
"tentative recommendations" were
Brannan believes that he should to be shown to the farmers. After
set up a systen of long-term for¬

to

these

whipped .into final form by the
department.
In a word, the local D of A

also

proved

Federal

cajole

the

use

states

the

aid

tried

and

device

into

setting

to
up

^.Federally-directed systems under


http://fraser.stlouisfed.org/
iiiiiw«ni»'
Federal Reserve Bank of St. Louis
-

had reacted

making long-term
investments in forestry.
Charley
would

■<fcii

farmers

recommendations, they were to be

so

financed in

•

the

that people could

estry credit

bureaucracy

—

organizations
supposed

to

conservative

farm

opposing — were
develop one - enor-

J;

his

submit

to

dare

won't

recom¬

in '52. He

ponents to initiate a "stop move¬

"In such times of national
as

ment." In this

case

it would be

a

Causes of

Industrial Peace Un¬

Bargaining—Min-

Collective

der

Plant of Colorado Fuel and
Iron Corporation and Jwo Locals
of United Steelworkers of Amer¬
ica—National Planning Associa¬

nequa

N. W., Wash¬
C.—Paper—$1.00.

tion, 800 21st Street,
ington 6, D.

Business Cycles
auspices of Uni¬
versities-National Bureau Com¬
mittee for Economic Research—
National Bureau of
Economic
Research
Incorporated, 1819
Conference

held

under

on

the

Broadway, New York 23,

N. Y.—

Cloth—$6.00.
Revenue Act

of 1951 With Ex¬

planation and Pay-as-you-go ta¬
bles—Prentice-Hall, Inc., 70 Fifth
Avenue, New York 11, N. Y.—•
Paper—$1.50 (lower rate on quan¬
tity orders).
•

now

country there is an

nomical

possible,"

way

he

was

trying to "sell"

to

the

country

nounced

view.

Charley,

review,

huge

The

was

this

only

stimulate

to

all,

roomful

them

of

farmers

100

if

There

get

group

you

half

of

have

something

for

them

to

the written

facto squares

language of the

so

Eisenhower.

one

important

Republican

of the international¬

General

Eisenhower

obviously the choice of the

internationalists

that

there

is

no

other Republican possibility upon

»

-

-

WE SUGGEST

RIVERSIDE CEMENT CO.
(common) STOCK

CLASS B

in

leading

of cement

producer

fast-growing

California.-

Southern

"■

Analysis of this Company
a

and

Indus¬

review of the Cement

try available on request.

Priced about

$13.00

per

share

LERNER & CO.

However,
is

This denial ex-post

present,

ists.

talk about.

with

at

Appreciation Potential

■

serious

in the

only
men

one

Taft

General

that consists

them

paid government agents, you have
to

is

of

For

Large

A

only

party opposed to Taft's ideas, and

people, half of

and

is

an¬

;
is

Senator

that

and

says

the

of

man.

to

rival

re¬

progress

there

Now

a program

through

the

down

said.

Charley specifically denied that
he

■

■■■'*"

Investment Securities

10 Post Office Square,

Boston 9, Mass.

Tel. HUbbard 2-1990

■

Allied Electric Products
.

credit but too

'

*

in that Charley hasn't sold
program
and he
probably

mendations to Congress

a

D

'

as

held in

left

are

>•/

'

camp

aspire for

Review,"

Policy

Farm

"Family

"groundswell of grass roots

opinion," to use the jargon of the
times, for the Bigger & Better
Department of Agriculture.

the

plus

those who might

Business

discussion.. After

available local bureaucracy of the

draft.

no

0JGA?

.

practices.

or

pretation from the nation's Capital
and may or may not coincide with
the "Chronicle's" own views.)
[

high

get about $7 per diem plus around
maximum as $2,500 per farm—the five cents a mile for the use of
present
statutory limit
on
the their cars, when operating
on
amount which can be paid to any business of the Secretary of Agri¬
individual for soil
conservation culture.

as

then

flect the "behind the scene" inter-

confront the
"stop Taft" movement.
ever-increas¬
Those persons who are rivals
ing need for the maximum effort
the
nomination
as
well as
on
the part of all agencies of for
those who oppose the ideas of the
government to make certain that
YJnder the direct payment subsidy mittees. All in
all, the department the programs they are operating announced aspirant for the nom¬
-or Brannan plan, the Secretary of
has a local regulatory propaganda, are being carried out in the most ination, immediately move to form
Agriculture would put some kind and political bureaucracy of some efficient and effective and eeor a temporary alliance for holding
which could go to any one farmer.

is

(This column is intended to re¬

v.

emergency

-instance of Mr. Brannan's
Brannan dispatched this pack¬
willingness to sacrifice the large,
age to the field staff of the De¬
.successful commercial farmer for
partment of Agriculture and the
ihe
sake
of the small
farmer. local defense mobilization com¬
only

of

to

not want to run

"draft"

suspense.

the

\:

he

And

draft.

a

nomination,

the

m

payments

point
getting
has got many farm leaders and
Actually, the whole thing was a
Johnnie, the Farmer's Son, out of
Congressmen wise to what he is
implications of this plan alone,
Farmers could not read or
bed oh' a winter morning to start flop.
doing and in bitter opposition. So
the reassertion is only a tiny part
the fire, and break the ice on the savvy such an enormous brochure he has to
give up, for the time
of
the
innumerable
additional
water pail.
This was made clear, of new proposals, even when al¬ being.
ipowers which the Department of
because he would also do some¬ legedly in their interest, in a twoAgriculture either "recommends"
thing about the poor state of farm hour meeting. The county meet¬
Old-time politicos here say that
or "suggests" for itself in this 121houses and their lack of modern¬ ings usually got tied up instead
the Taft strategy of announcing
page document. The Brannan plan
ization by other recommendations with such questions as "why is
is, in the light of relevant political
proposes that in lieu of conven¬ elsewhere in the report. By fam¬ the
department so late paying me
circumstances,
nothing short of
tional price supports, the govern¬
ily relations he means the prob¬ for that lime I put on last spring."
brilliant. Furthermore, they say,
ment simply pay all
farmers a
lems, perhaps, of too demanding So even the most imaginative of¬
a
considerable part of the press
cash bonus at the end of the year
husbands, or why-farm wives ficials could not report to Charley
has failed to grasp why. Here is
on ALL crops, the cash to
make don't
Brannan
a
wild rush
of farm
get mink coats.
the way they explain it:«p the difference between selling
As a whole, the report is one opinion for his many-sided pro¬
Ordinarily when a candidate
price and "parity."
;.
v;:grand
assemblage : of proposed gram.^.
out
in
front
announces
early
Among other things, the report burdens for the Department
And Charley has come around
of
(when one is not in front, as when
■suggests that the government buy
Agriculture and Charley Brannan to admit it. He told a Senate Com¬
Harold Stassen announced early
up large farms
and resell this to shoulder. If there is any de¬ mittee recently he was just being
in the '48 campaign, he is laughed
Sand to farmers whose holdings
partmental agency which Charley a good administrator and asking
are too small for what Mr. Branoverlooked in his request for new farmers—as any good Administra¬ at), the announcement immediate¬
wan
would consider efficient,
ly becomes a signal to his op¬
and additional spending and regu¬ tor should do—how are we doing,
enormous

this

until

So the internationalist
'

lations."

breadth: The
plan is reasserted, but
and controversial as are
its

instance

such

anyway,

■

—
:

housekeeping

home,

the

to

broken

profess

not

Will

candidate

a

Eisenhower may

procedures, purchasing practices,
child development, and family re¬

for so many millions

of people.

To

in

ment

hundreds

.<?elf to solving so many

he

If

clude

Brannan's report
"Unfortunately, little re¬
search in home management has
been conducted," it was added, the
misfortune being only that such
research was not being conducted
by the Agricultural Research Ad¬
ministration. It was recommend¬
fseem
possible that one official
ed that ARA delve into such sub¬
could imagine he had such wisjects as "time and money manage¬
■aom that he could dedicate him-

V

prove

may

proceed so far as utterly to pre¬

ftr

opined.

that one
or a group
of buraucrat's ambi¬
tions could ever be
so- all-en¬
compassing. Or, if one is of the
belief that most officials are dedi¬
cated to the public weal, it doesn't

Eisenhower

become

cessful," Charley

reading it,

lity because even after

&t does not seem possible

whom to center their
hoping thus to counter

"drafted," the Taft build-up may

home

"Good

economic.

candi¬

upon

stick.

management is essential if family
farms are to be financially suc¬

understand it—it
-defies credulity. It defies credu¬
could

either

real

be, politically speaking, a

m

Secretary's ideas are not all

strictly

read—and few

Even when it is

farmers

useful
a

or

man

of

Lodges

Taft's build-up.
And

CTT3

uction."

xning, over-simplicity of Truman.
Xts music is Wagnerian.
■

-

1

country. Although he

campaigns on doesn't quite spell this out, the
idea apparently is that if there
100 separate fronts, but by piece¬
were enough of these they could
meal conquest of the conservative
try every idea which occurred to
enemy over a dozen or so years,
any D of A official and "demon¬
as has become the more standard
strate" these wonderful practices
Boosevelt-Truman technique.
—•
to the poor farmers.
Charley's beautiful
dream of
He would give the dapartment
empire is all set forth in the
".Family Farm Policy Review," a power to make direct government
loans to farmers and cooperatives
121-page offset job first issued
to encourage "defense food prod¬
June 11. Its style is the all-prom-

1

straw

support,

J.P. BIGTHUMB

the

remotely

man

a

date,

'

simultaneous

100

'

as

develop

would like to

Brannan

ing dawn, and that dawn has told
Charley that great bureaucratic
empires are won not by

the

in

any

cutting of all timber
United States would be

the

which

possibility

a

running,

hower

WASHINGTON, D. C.—Charley
Brannan's latest dream of empire

normal political re¬

the

stymies

f

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II