The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
jDCT t <1S4«v
Edition
1
in 2 Sections-Section
ESTABLISHED 1839
■
Reg. U. S. Pat. Office
Number 4532
Volume 164
Price 60 Cents
York, N. Y., Thursday, October 10, 1946
New
Copy
a
Permanently American Bankers Association
Holds 7 2d Annual Convention
Higher Price level?
Are We Facing a
*
-
By HAROLD B. DORSEY
•
^ -
President, Argus Research Corporation
/
After
C. W. Bailey,
analyst cites war-created inflation "frozen"into eco¬
evidenced by commodity price level 45%
Investment
lapse of two years, convenes at Stevens Hotel in Chicago, Sept. 23-25.
elected President for ensuing year and Joseph M. Dodge, VicePresident.
Treasurer, S. Albert Phillips, is reelected. Other officers and division
■,
:
-
i
nomic structure in 1920's,
and by stock prices 210% above previous high.
inflation potential is even more powerful, mainly
because of much higher wage costs and farm commodity price
above prewar,
The
the
labor difficulties
levels. :
,
stock price pattern with
comparisons of the recent
many
„
s
i
one
i.
is
serious
than
any
of
the
others
failure
to
the
cance
of
comm
k
odity
'
price action in
broad per¬
its
spective.
Of vastly
greater im¬
portance than
43%
de¬
the
Dorscy
in
cline
•
Correspondent reports industrial damage from war bombing considable. Rubble being cleared away and business slowly reviving—
chiefly in reconversion of ingenious toy manufacturing at 25% of
prewar capacity.
Potential competition in other items, as type¬
writers, feared by British. Raw material imports, particularly
brass and tinplate, badly needed. : Taxation confiscatory.
GERMANY—Standing by the remains of an 11th
known as k"'
the Burg, one
NUERNBERG,
century chapel which crowns an eminence
commands > a^
■■■■ii
com¬
magnificent
modity prices and the 41% decline
in stock prices in that period was
v
that, in the eight years
iollowing, commodity prices held
level
45%
some
1921
low,
city"
the
new.
by
a
old
centuries
wall, old
N uern berg
influ-
preponderantly
nberg,
"old
Surrou n d e d
prices
above the highest pre¬
record and 420% over the
vious
f
and
210%
rose
uer
o
w
e
the
higher than
the prewar range and stock
i
N
fact
a
was
on page
1820)
seum-piece of
a
city.
But
one
cold
INDEX
see
page
i
of
index
detailed
For
contents
morning early
1779
n
January
1945
a-nd
the
hour
Now one
Vacuum Concrete
Aerovox
Corp.*
Havana Litho. Co.*
•
came
the air attack,
Herbert M. Bratter
in
an
Altstadt was no more.
sees only here and there,
by the skeletons
"
.
1
" "
timbered
C.
W.
Bailey
S.
Joseph M. Dodge
Albert
Phillips
dwelling, a suggestion of what this
Medieval
municipal" masterpiece
Albrecht Durer's
resembled.
once
statue still stares
his
groggy
now
leg,"
one
one
the
the
German
'
on
sees
streets today.
Beyond
Mr.
—
Bailey
in Clarksville, Tennessee,-, and
there. He was first em¬
born
was
unperturbed, but educated in the public schools
house "stands on ployed by the
First
National®
do so many of
as
veterans
mu¬
a
!■
I
occasional surviving
an
'
(Continued
^
"Chronicle"
Special Correspondent of the
compreh e nd
the s i g n i f i-
B.
\
HERBERT M. BRATTER
is
the
at
held at the Stevens Hotel, in Chicago, beginning
of the First National Bank, Clarksville, Tenn., was
72nd Annual Convention
At the
omis-
that
o n
more
the
^
Sept. 23, C. W. Bailey, President
torn
s wMStion SSiSeteto elected President of the American Bankers Association. Ile.was advanced from Vicemany respects «
—
• President, in which capacity he has served for the past year.
but
Harold
initiative and private enterprise.
>
legislation. Concludes these factors will outweigh
motivating permanently higher stock price
evolved which' will encourage individual
Secretary Snyder's address, others given herein.
absolute minimum and tax program
Declares present
in
«
Adopt resolution urging that Federal expenditures be held to
officials chosen.
-
ruins below one's
of
Clarksville
Assistant
Cashier; he
Bank
Cashier
in
President
1908,
in
in
as
the
Agricultural
elected
and he became
the
American
1920.
1904
was
is
He
also
glance surveys the horizon in the President of the Southern Trust
direction of the great
stadium. Company of Clarksville. He served
President
of
the
Tennessee
There, where. Hitler used to mo¬ as
bilize hate, today one can see
sports of the West,
of the New
World.
played by men
This was the
city where Der Stuermer
ranted.
Streicher
week, "Julius
Last
the
bit
Chairman
was
of
the
tion,
;
tion.
During the past two years, Mr.
Bailey was Chairman of the Agri¬
cultural Commission of the Amer¬
He has
ican Bankers Association.
1929-1930;
several
for
of
Associa¬
(Continued on page 1827)
years
agricultural committee of
the- Tennessee
and
was
Bankers
Associa¬
that
position
in
when the Tennessee bankers first
achieved the 1,000
(Continued on page 1831)
of churches and
Association
Bankers
Commission
Bankers
State and
point rating of
Municipal
GULF, MOBILE
& OHIO RR.
Bonds
COMMON STOCK
Prospectus
request
on
Analysis on request
Hirsch & Co.
Successors
to
'
-
York
New
and other
Stock
2-0600
Chicago
64 Wall Street,
Teletype NT 1-210
Cleveland
Geneva
Established 1927
v
London
(Representative)
THE NATIONAL CITY BANK
investment securities
Exchange
Exchanges
25 Broad St., New York 4, N. Y.
HAnover
<
CO.
HntSCH, LILIENTHAL A
Members
"<
R. H. Johnson & Co.
Albany
Washington, D. C.
Scranton
Wilkes-Barre
New Haven
Woonsocket
Dallas
Baltimore
Pittsburgh
Springfield
CORPORATE'
FINANCE
BOND
SECONDARY
BROKERS
■
Bond
Dept. Teletype: NY 1-708
Conv. Preferred
STOCK EXCHANGE
14 Wall st., New York
5.N.y.
Members
Security Dealers Ass'n.
45 Nassau Street
Tel.
TELEPHONE-RECTOR 2-6300
N. Y.
REctor
Philadelphia
2-3600
Telephone:
New York 5
Teletype N. Y. 1-516
Enterprise 6015
New York
ST.,
N. Y.
HAnover 2-0980
Montreal
90c
NATIONAL BANK
THE
OF
Brokerage
Service
on
Appraisal of
Reynolds & Co.
120
Exchange
Broadway, New York 5,
N. Y.
Telephone: REctor 2-8600
Bell Teletype
~
and Dealers
request
Members New York Stock
NY 1-635
England
Public Service Co.
Hardy & Co.
Members New York
Members New
Stock Exchange
York Curb Exchange
30 Broad St.
Tel. DIgby 4-7800
New York 4
Tele. NY 1-733
Values v;; "
available upon request
for Banks, Brokers
*Prospectus
CITY OF NEW YORK
New
Conv. Preferred
*Twin Coach Company
-
Toronto
^Detroit Harvester Co. Com.
Solar Aircraft Company
:
THE CHASE
Bell Teletype NY 1-895
Bond
'
1?"
Dealers Assn.
Alloys, Inc.
Acme Aluminum
Gearhart & Company
MEMBERS- NEW YORK
WILLIAM
-
Conv. Preferred
Bull, holden & c2
52
Bond Department
Members
New York Security
OF NEW YORK
-
MARKETS
INCORPORATED
HART SIMM & CO.
'
■
PHILADELPHIA
Buffalo
Syracuse
BOSTON
Troy
New York 5
••
ira haupt & co.
Members New York Stock Exchange
and other Principal Exchanges
111
10 Post Office Sq.
Boston 9
Broadway
New
York 6
2-3100
Tele. NY 1-2708
REctor
.
Direct Private
Hancock 3750
Wire to Boston
■ii'i'
f
'Hi
THE COMMERCIAL & FINANCIAL CHRONICLE
1778
Thursday, October 10, 1946
Trading Markets in:
Arnold Brilhart*
Alabama Mills
Taca
Airways*
Director of OWMR says
Prospectus
beginning of second year of peace holds
danger. Holds unless runaway prices
prevented, it will be difficult to stabilize production and employ-;"
are
salutary action for business is to reduce prices
and that government has four fold antiinflation program comprising: (1) direct price controls and sub§
sidies; (2) wage stabilization; (3) anti-inflationary itscal and
monetary policy; and (4) production controls.
Concludes real
wages have been kept down by rising prices. ~ President Truman
without
SECURITIES CORP.
1920
Established
Dealers Assn.
Securities Dealers, Inc.
Members N. Y. Security
Nat'l.Ass'n
of
HA 2-8773
PI., N.Y. 5
<0 Biohange
NY 1-423
BELL TELETYPE
reducing
wages,
Dr. John It.
version in
Coal
Horn
Common & Preferred
:
..
characterized
the
-
ation
and
"of
as
May, McEwen & Kaiser
Rochester & Pittsburgh Coal
Common
of
great
danger."
Though we
have, he says,
ity
to
move
forward to
Bell
than
:
any
na¬
tion
r:'
WOrth 2-4230
f
Teletype NY 1-1227
.
levels
of real income
N. Y. 5
120 Broadway,
;
higher
Stock Exchange
Members Baltimore
has
yet
achieved,"
are
we
faced with
John R. Steelman
the threat that
"we will be unable to shift from
disputes and shortages of mate¬
situation where de¬ rials and component parts. It is
mand exceeds supply to one where true for the economy as a whole
demand and supply are in approx¬ by any measure that we use—em¬
the
Electric Ferries
Preferred
&
Common
Preferred
&
Savoy Plaza
i
balance, without falling to ployment, unemployment, total in¬
of equilibrium on a far come
payments
to
individuals,
point
lower level of income and produc¬
tion than we now have."
The
-
obstacle
great
Stock
Ex
a
1956
3/6s,
present
imate
Rogers Peet
Common
"
profits
York Curb Exchange
Members New
York b
31 Nassau Street, New
Excerpts of the outstanding por¬
tions of Dr. Steelman's report fol¬
/
r
,
*•
I
Production and Employment
Teletype NY 1-1548
A.
"
S.
'
„
\V,v
v
-
-
H. G. BRUNS & CO.
20 Pine Street, New York
Bell
5
M
v
.■
.v'r-
^
tv
:■
i;
•
t
•/.•
£•.
-''v.r.<-'v
*'•\ ^
.-V; Members
.
New
V
any
doubt that
have
dustrial
we
just
turned
over
in
quate
a
will
the
greatest * holocaust
has
that
Personally, I believe
not
can
August
was
York
120
it will be
lightly proceed
on
2.7
,
an
time high and farmers have
been in so liquid a position.
5
(Continued
on page
1819)
today in our journey along
which leads to atomic
road
2. Present Status of Atomic
Energy
A. Status on V-J
Day—Between
July,
1942
and
July,
1945, there
expended in the construction
operation of atomic bomb
facilities a total of over 2 billion
was
and
dollars.
For this expenditure
accomplished the following;
(Continued
on
page
we
1825) '
Rockwell
a
Manufacturing Co.
the
world.
To
efforts
on
that
end, the utmost
the
part of engineers
and industry must be directed to
Bought~Soid-~-QuQtedr
Analysis
Members New York Stock Exchange
25 Broad
; «
causes
which have
branch offices
our
Birmingham Electric
Empire Dist. Elec.
Adequate
power for fer¬
for irrigation and
farm machinery to¬
Northern Indiana P.S. ;
power
for
NY 1-1557
American Gas & Power
Power is the index of civiliza¬
tion,
;
La.-Birmingham, Ala.
Direct wires to
mankind acted to promote war.
tilizers,
St., New York 4, N. Y.
HAnover 2-0700
New Orleans,
development of atomic energy
dom from the
Request
on
Steiner, Rouse &Co
for
Scran ton Elec. Com.
South Carolina Elec. Gas
Edward A. Purcell & Co.
P * Address by Mr.
Klein at meet¬
ing of American Society of Me¬
chanical Engineers, Boston, Mass.,
Oct. 2, 1946.
Members New York Stock
Exchange*
Members New York Curb
all-
never
uses
us
power
Farm income has risen to
REctor 2-7815
the
against false steps that
may set off a new conflagration.
the
for_ household
toward insuring
energy utilization.
mankind
profits, after taxes, are
gether spell a prosperous agricul¬
highest point in history, in
ture
and freedom
from hunger
spite: of the fact that, in some re¬
and famine.
Adequate power for
conversion industries, profits are
mines, for factories, and for trans¬
low because of low volume of fin¬
portation spell freedom from inished output.
>
Stock
BROADWAY, NEW YORK
Tel.
exceeded
never
Business
•
stand
always throughout the history of
It
far
do¬
mestic peace.
Let us at this
point pause for a
few minutes to see where we
assumption that this will be so.
Eternal vigilance alone will safe^
guard
power
go
known.
ever
record of the attainment of
peace
and of its manifold
benefits, but
we
slavery and low living
and, incidentally,, ade¬
standards
at the
Exchange
New York Curb Exchange
1-1843
NY
<>V-
followed,
have
the generation of low cost
electric power so that the
peoples
of the world
may be assured free¬
million.
been.
tyc PONNELL & Co
WHitehall 3-1223
Teletype
9
Income payments to individuals
total about $167 billion a
year, the highest they have ever
Bought—Sgldr^Quoted
Telephone:
to
now
Airlines
Wells
stock
Common
been present at the detonation of an
atomic
witnessed the
awe-inspiring devastation that '
has
gust, 1940.
American Overseas
Stock
Struthers
close
during the low point of
our postwar
transition; 8 million
workers were
unemployed in Au¬
,
Campbell
Common
•
\
who
million
Byrndun Corporation
,
was
Unemployment: in
2
,
year
million above the same^month in
1940.
V
*
In the first year of peace, the
dominant economic force has been
the pressure of a large volume of
Stock
employment, following
gust of this
:
Common
has
who has
one
and
industry*
Introduction
lion for several months, then ad¬
vanced to 58 million, an all-time The most certain way we can pre¬
vent the use of the atomic bomb
high for war or peace. Jobs have
been found for 10 million refund¬ for military destructiveness is to
hasten the improvement in stand¬
ing servicemen and women, and
of
living throughout the
total civilian employment in Au¬ ards
low: '
COrtlandt 7-4070
Telephone
Bell System
production.
VJ-day, remained at about 51 mil¬
to
increases in prices."
Vanderhoef & Robinson
or
Civilian
stability, Mr.
holds,: is "further rapid
Steelman
No
bomb,
future of engineering and
on
..
"an opportun¬
Mitchell ^ Compamj
profound effect
demand, backed by large purchas¬
book which
ing power—in part the income of
irecords the
earlier periods—entering the mar¬
progress
of
ket in an effort to obtain goods
and services; This pressure has civilization.
The new page
been the chief fuel of our advance
might proper¬
since VJ-day.
be
cap¬
As long as we were able to keep ly
tioned
"The
prices" reasonably stable, this in¬
Atomic
Era."
flationary force drove our econ¬
Today, except
omy forward at tremendous speed.
for
a
few
We have made an extraordinarily
A. C. Klein
rapid turn-around from; all-out smudges, it is
a
clean page
war, and have reached - our pres¬
on which we
may write a history
ent high level of peacetime activ¬
of the attainment of peace and
ity with relatively little disloca¬
tion and suffering; This is true plenty or, upon which, God forbid,
we shall write the
history of ihe
notwitstanding labor-management
present
great promise
L. Lemke
B.
a
v
years,
1.
leaf
economic situ-
Common & Preferred
y
.
Steelman, Director of War Mobilization and Recon¬
his quarterly report entitled "The Second Year of Peace,"
.
Howe Scale
will have
can
report.
approves
Elk
converting it into electricity can be combut whether it will be "cheap", will
require
years of experience to demonstrate.
Says only largest producers
will benefit, but collateral uses
of isotropes and other materials
pleted in three
Asserts most
ment.
KING & KING
Energy
> V
By A. C. KLEIN*
Engineering Manager, Stone & Webster
Engineering Corporation
After reviewing progress and status in
developing atomic energy,
Mr. Klein holds task of
both great promise and great
Higgins, Inc*
"With
The Future of Atomic
Rising' Pfices Chief Threat io
Economic Stability: Steelman
Standard G & E Com.
Exchange
50
Broadway WHitehall 4-8120
Bell System Teletype NY
New
York 4,
1-1910
N. Y.
Our
We Maintain Active Markets in U.
S. FUNDS for
"Special Situations"
Department
Is
or
BROWN
of
placement
large
blocks
PAPER, Common & Preferred
COMPANY, Common & Preferred
Stpd. Pfds.
Hotel Waldorf-Astoria
BULOLO GOLD DREDGING
for the accumulation
maintained
Northern New England
MINNESOTA & ONTARIO PAPER
NORANDA MINES i
of
Over-the-Counter Stocks and Bonds.
Members N. Y.. Security
37 Wall St., N. Y. 5
Bell
Members N. Y. Stock
Dealers Assn.
Hanover 2-4850
.
Telephone BArclay 7-0100
priced speculation—
Keynote
Recordings, Inc.
Manufacturer
i:
tf.
•.
••
For
V
"
''•> i'
'
Members
37
Teletype NY 1-672
J
*
*•
•
>'•'
V-/
*
'
v'~v
Racing Association
Common &
Security Dealers Assn.
Wall St., N. Y. 5
on
Preferred
Members
New
York
Stock
Exchange
25 Broad St., New York 4, N. Y.
HAnover 2-4771
74 Trinity
Tele. NY 1-2908
Private Wires to
Security Dealers Association
Place, New York 6, N. Y.
Telephone HAnover 2-2400
'
Teletype 1-376-377-378
Buffalo—Cleveland—Detroit—PitUbnrrh—St. Louis
■mTI i lift"
Hotel, Inc.
Frank C. Masterson & Co.
Members
New
York Curb
64 WALL ST.
Exchange
NEW YORK B
Teletype NY 1-1140
HAnover 2-9470
Western Union Leased
Pacific & Atlantic Telegraph Cot
Troster, Currie & Summers
York
Commodore
Line Stocks
—■
SOLD
—
QUOTED
T rading Markets
Member New
Aspiitook Corp.
International Ocean Telegraph Ca
Request
Simons, Linburn & Co.
Bridge
Common Stock
Memorandum
•Prospectus
HAnover 2-4850
FEDERAL WATER
BOUGHT
Currently selling around 2l/2
Detroit Inf I
& GAS CORPORATION
,
Stock
Common
N. Y.
Bell Teletypes—NY 1-1126 & 1127
of y
Phonograph Records
Theatre, Inc.
SreeuernvdCompanu
,
Banks, Brokers & Dealers
^v
Eastern
;
Exchange and Other Principal Exchanges
'
NEW YORK 6, N. Y.
S;
115 BROADWAY
Teletypes—NY 1-1126 & 1127
A low
United Artists
Goodbody & Co.
:
Title Guarantee & Trust
Canadian Securities Dept.
&Teeue<»«iCompaTV^
Scranton Spring
Brook Water
Boston & Maine R.R.'
ABITIBI POWER &
«n
on
Southern & Atlantic Tele. Co.
Empire & Bay States Teleg. Co.
request
bought
-
sold
•
quoted
J-G-White & Company
Arnhold and S. Bleichroeder
INCORPORATED
37 WALL STREET
NEW YORK 5
ESTABLISHED 1890
Tel. HAnover 2-9300
'
:
Tele. NY 1-1815
INC.
30 Broad St.
WHitehall
3-9200
New York
Teletype NY
1-51
-
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4532
164
■Volume
1779
A:
I NDE X
and
Articles
Ate We facing
a
Needed: A Free Cold
!
__Cever
Permanently Higher Price level?
<*
—Harold B. Dorsey_____>—
Market for
Ii-'ft.'lX
.
Nuernberg Today—Herbert M. Bratter_4^*w____4-*4_..---Cover
A Free Gold Market for Stability
—James
D.^ Mooney
»
President and Chairman of
E.
—Willard
and
Bull
or
Past
Stock Break
The
Future—David
Germain.——*-*1782
MacDuffiel783
44-1783
Sarnoff———-———-1783 :
The concept of a
principles which
Why? What Next?—John F. Reilly——1784
-
f i
Requirements for Export Trade—George W. Wolf—-1784
Haruch Defends His Atomic Control Plan——__1785 «
Young——....—1786
C. W. Bailey, New ABA President, Outlines Plans
1790
Banks Look Forward—Frank C. Rathje——————1792
The Banker Looks
Nationalization
vs.
Free Gold Market is based
.center^:1^:^
ing Will declinp.
to
of
solid
lify
Cover
h
—1778
R, Steelrnim
is
Socialism
World Trade Not Obstructed by Lhcal
---v?5
—Hugh Dalton
British-ITV S» "Marriage- in Germarty.^^
Harriman TJrges More and Balanced Production.
m
and practices in money
matters exert a fundamental and
profound; influence
duction
1&08
Britain and
Business1 Maii^s
1781
11
^
Recommendations—--^——1787
---'--^--^-^-^-,--.^^-^--.^*^--^-.-.^---1804
i
Calendar*—^.-----..-*-4—-1837
--—^—'-.1781"
*1830
Reporter's Report—
;
"i—1843
ri I')
"'i",;.
j'
\ .a.1,:.;!"
Published
A
New York 8, N. Y.
REctor 2-9570 to
r
9576
HERBERT D. SEIBERT, Editor & Publisher
*
•••
>*
William
dana
seibert,
tho Act of March
Other
and
$25.00
194^
per
Quotation
fect
on
industry
the rate
of
:
.
<
s
;,
Company "
*
as
,
~
V
r
TITLE COMPANY
CERTIFICATES
Wry
at the post office at * New
Bond & Mtge. Guar. Co.
A. E.
m are
interested in
N. Y. Title & Mtge. Co.
Members
Newburger, Loeb & Co.
Members
15 Broad
New
York Stock Exchange
St, N.Y. 5
Bell
WHitehali 4-6330
Teletype NY 1-2033
N.
paper
Bought—Sold—Quoted
mental
nothing.
disease,
"smart
aleckism"
w£
might call it, has permeated Amer-i
ica in a mysterious, insidious way
just
as
out
the
Ptbspetcius
influenza spread through
country during the year
Men who
1918,
become
themselves
submit
of the
cepted
pose
J. F.
to
New York
as
an
authority
iii
art$
TRADING MARKETS
Thiokol Corp-
••
that have
factors
toms of this mental disease is
National Shirt
"gaily" presumption with
Which they pick out pegged rates
or prices. They pick out, for in-*
stance, a pegged rate expressing,
presumably,
the value of the
paper dollar vis-a-vis gold. They
pick out pegged rates of exchange
as, for example, the exchange Val¬
between the paper
paper
paper
ProdUOtO
Hi RIO D
Broadway
170
Bell
Broadway
DIgby 4-8640
Teletype NY 1-832, 834
on page
1818)
Punta
t
offerings of
Now York—Chicago—St. Loui*
Kansas City—Los Angelas
2-0300
1-84
Alegre Sugar
Sugar Assoc,
Lea Fabrics
| tl. S. Sugar
&
Co.
^Fidelity Electric
Class A Common Stock
Susquehanna Mills
♦Prospectus on request
Co,
..Members New York Stock Exchange
DUNNE & CO.
Members New York Security Dealers Assn
25 Broad St., New York
WHitehali 3-0272—Teletype
Private, Wire
■
to
4, N. Y.
NY 1-956
Boston
4 ;
MacFadden
Fuller Houses, Inc. §
Publications, inc.
All
Capital Stock
*
HorRsseSIRqster
Established 1914
Analysis
Trinity Place. New York 6, N. Y.
,Telephone:
•
BOwIingr Green 9-7400
Teletypes:
NY 1-375 & NY 1-2751
upon
Request
C. E. Unterberg &
Members
74
;
& Trust Co.
*
>
Issues
Public National Bank
Boughi—Sold—Quoted
CHICAGO 4
HarriSOn 2075
Teletype CG 130
Teletype NY
Commodore Htotel
v
♦
B' rd of Trade Bldg.
Direct Wire Service
WOrth
System
Haitian Corporation
franc or the paper peso or
Security Dealers Assn
NEW YORK 4
at,
dollar and
25 Broad Street, New York
V
Telephone HAnover 2-4300
; ( :.£. *
. Teletype NY
.
&
Members New York Security Dealers Awn.
pound sterling or the
(Continued
Shops
Laclede-Christy Clay
the
naive and
the
Chicago
discipline that must be ac¬
by one who presumes to
been dis¬
covered and applied by previous
generations. Another of the symp¬
ue
;
none
sphere of' action, the discipline
that
impels
such a person td
search for end know the princi-'
pal
bH Request
Reilly & Co.,*
infected
with the virus of this mental dis4
ease
.
LABORATORIES
money
This
;
ALLEN B. DUM0NT
PREFERRED STOCKS
Staley Mfg. f
Y.
with
abroad
worth
6f
Security Dealers Assn.
National Assn. of Security Dealers, Inc.
Public Utility and Industrial
STRAUSS BROS.
32
Prudence Co.
tries
are
York
New
disease
High Grade
Lawyers Mortgage Co.
Lawyers Title & Guar. Co.
mental
Teletype NY 1-1203
Meinbei*
:
:
National Radiator
25,; 1942,
underway*
♦
Upson Company
Sprague Electric
*
commerce
Broadway, New York, N. Y.
HAnover 2-8970
experiences of the various coun-f
St>encaiSrasik
-
second-class matter Febru-
39
inflation
Eastern
exchange, remittances for for¬
Grinnell Corp.
Copyright 1946 by William B. Dana
and
will be confusion and depression
year.
::>4 ■ Other Offices: 135 S. La Salle St., Chi¬
cago
3, 111.
(Telephone: • State 0613);
1
Drapers' Gardens, London, E. C.] England,
Reentered
If,: iri
effect of rising prices, the ef¬
eign subscriptions and advertisements must
be made in New York funds.
*
into
thrown
disorder*
Record—Monthly,
plete statistical issue — market quotation
records, corporation news, bank clearings,
news, etc.)
;v**
;
K
aire,
commerce
and
of
form
G0LDWATER, FRANK & 0GDEN
Publications
Monthly
Earnings Record — Monthly,
$25.00 per year.
t ^
^
Note—On account of the fluctuations in
«tate and city
.
pro-
ing the money with the concomit¬
ant
Rate* :.
Every Thursday (general news and ad¬
vertising Issue) and every Monday (com-
c/o Edwards & Smith.
of
the
States,
we
are
to
be
plagued with further monetary
experiments, particularly in the
Africa* $31.00 per year.
Bank
;
*
tfanSactiohs
United
Subscriptions in United States and Pos¬
$26.00 per year; in Dominion of
Canada, $29.00 per year; South and Central
America, Spain, Mexico and Cuba, $29.50
per
year;
Great
Britain,
Continental
Europe (except Spaih),. Asia, Australia and
president %
: william d. riggs, Business Manager
Thursday, October 10,
ahd
doubt
sessions,
Office
DANA COMPANY, Publishers
25 Park Place,
uncertain
dUctipn and distribution, industry
4——.1834
Subscription
*
',
as
now>
innumerable
.1836
Y.,; uiider
York, N.
3, 1879.
FINANCIAL CHRONICLE
WILLIAM B.
becomes
direction df continually cheapen¬
Twice Weekly
Regi U. S. Patent
is
ing continually rriore uncertain as
political expediency decides, the
.
COMMERCIAL and
The
o r
and-particularly
when this denominator, is becom¬
Prospective Security Offerings..^*—.1842
Public Utility Securities
——4*44***4.—1784
Railroad Securities
——
,.*4-—
1810
Real' Estate' Securities***444*~4-*44;*****-.
————-1788
Securities Salesman's Corner..—-4*—
a
1833"
H
t
it
n a
as
Observations—aA. Wilfred May—
Our Reporter on Governments—-..——4.
Securities Now In Registration
.—i
Tomorrow's Markets (Walter Whyte Says)
political expediency pre¬
sents major hazards to the future
of industry and commerce.
Money is i the commbhl denohr*
inator
by
whicH ■ cortiplicatea
transfers of goods and services are
put into simple comparable math¬
ematical ratios. When the denom-
New Security Issties
Our
mat¬
as
of
v
Investment
Mutual Funds;
and
"
Canadian'
Dealer-Broker
on nil v pro-*
distribution
opera¬
tions. Their determination
Regular Features
Stocks..*-.**-.*—...—-**..**iretton Woods—Paul Einzig—
Governmental
policies
1790
Bank and Insurance
the
rriakfe for stability.
ters
>
fact
is
primary catalyser
of all the complex elements that
1788
—
basic
Market
i*_—*1789
100% Margins and the Market Break
Annual Meeting
Fund and Bank End First
inevitably
the
—
Honors 25-Year Employees
—
arid
-1783
*..1785:
Truman Points to AFlVResponsibilities
1785
Wall Street Union Asks NYSE for 25% Wage Increase and
Severt-IIbtir Day ***
--4--——————---1788
John D. Small Reviews Employment.for August-.——1788
Chase National Bank
in
disaster
*
/'j
seems
to
have
spread
throughout the country, some ouU
growth of OUr trying to be too
smaft, a flaunting of all previous
human experience, particularly in
the field of experimenting with
James D. Mooney
paper money, a presumption that
forced a return td the experiences of previous gen-i
that a Free Gold erations in our
country and the
always
a v e
into
ESTATE
SECURITIES
preventing
seriously
now
the
and
march
STREET, NEW YORK
REAL
which
these
resulted
is
that
principles
Rising PHtes Chief Threat to Economic Stability
foundation
further
the
t tempts
a
:.V
divi¬
chance
Specialists in
Probably the. greatest obstacle
putting our mohey back on a
between prod¬
ucts in terms
Repeated
Economics
a
us a
Telephone: WHitehali 4-6651
'
,
Experience
vs
currencies.
'
-
since
Obsolete Securities Dept.
WALL
99
fundamental
•»
Aleck"
"Smart
currencies and
\
upon
years
a
buj).
we
quote!
f
and the American standard of liv¬
history to nul-
—John
to
20
declared, give
of
story
that
obsbletes
it's
was
•
meas-
between
u e s
;
American Bankers Association Holds 72nd Annual
Cunventldn:—
dend
Universal in application and which, constitute a
are
throughout
,
rates and prices without
peg
exchange val-
W. Snyderi—_L—---*---1794
,Hanes_*4V4-4~*****1800
Capitalism—Its Promise and Problems—Paul G. Hoffman. _ 1802
attempting to
ureforthe
Ahead—W. Randolph Bu?gess___—-—1796
Tree Enterprise—Fred' 1. K'^nt——^-1798
Banks and Small Business—Robert M.
r m
point of
Truth in Politics Act Needed—Robert R.
Fiscal Tasks' Ahead—-John
depression.
if
Even
produce confusion i
Says experience is cast aside by a mental disease 1
the
of
lot
'
the
That's
—dividend!
■>
demand. Holds this has brought i
only confusion and black'markets, and urges a return to the free 1
gold standard in order to avoid paper money inflation and promote \
multilateral trade throughout world.
Stock Trend- -Edmour
and
a
reference to lawS of supply and
Banking—E. Allen
Bear Market?—Roger W. Babson_—~
Radio:
free gold-market is
a
of "smart aleckism" in
Atkins-_-_„_l>——1——--1-—1782
of Coming Months
Will Determine
THE PASSED
-
experiments cahtintially cheapening money will
Some Wall Street Bankers Believe Events
Some Aspects of Investment
TWO YEARS BEFORE
Board, Willys-Overland Motors, Inc.
primary catalysis of complex
elements comprised in stability, Mr. Mooney points out monetary
Contending
WhaPs Ahead for Mortgage Investments?
—Raymond Rodgers £
*«4:ii*>_4 -4*-4—*4*444£4^:1780^
Inflation, Interest Rates and Investment Policy^
,; —Murray Shields
'^£-1781#
How Far Can We Protect the Investor?—John E. Hueni__1782
Postwar Regulation of Securities Market
,■v**"" '■
'
i
«
44* *4 4 444*4* *\4 4:4*-1779
-_4
AND COMPANY
Stability
By JAMES D. MOONEY
'
17 7 8
The Future of Atomic Energy—A. C. Klein
Needed:
[iCHTfllSIfll
B. S.
Page
News
61
N.
Co.
T. Security Dealers Ass'n
Broadway, New York 6,
N. Y,
Telephone BOwlihg Green 9-356S
Teletype NY 1-1666
-
THE COMMERCIAL & FINANCIAL CHRONICLE
Thursday, October 10, 1946
What's Ahead lor
BUSINESS BUZZ
Mortgage Investment?
actual markets
'
'
in 250
active issues
Art Metal Const.
American Bantam Car
Amer. Window Glass*
Com.
&
Pfd.
Automatic Instrument
Barcalo Mfg. Co.*
Cinecolor
.
"Chicago R:i:&Pac.f
Old Pfd.
Diebold Inc.
District Theatres?
Douglas Shoe*
Gt. Amer. Industries
Hartford-Empire Co.*
Jack & Heintz
Jessop Steel
Lanova*
Mastic
Asphalt
Michigan Chemical
Minn. & Ontario Paper
Missouri Pac.
Old Pfd.
.
"Just
Mohawk Rubber*
Put
'Satisfactory*
on
Her
Application, Johnson, and
Not <Huba-Huba'!l"
Moxie
N.Y. New Hav. & Hart
Old
World Trade Not Obstructed
Pfd.
N. 0. Texas & Mexico
Local
Purolator Prod.*
By
Socialism, Declares Dalton
Richardson Co.
Taylor^Wharton*
*The FR Corporation
Upson Corp.*
U. S. Air Conditioning
United Drill & Tool"B"
*Hungerford Plastics
^District Theatres
Tenn. Products
^Stratford Pen
^Princess .Vogue
Shops *Metal Forming Corp.
*Loew Drug Co., Inc.
*
LeRoy Company
Prospectus Available
Vacuum Concrete
FIRST COLONY CORPORATION
'
Alabama Mills*
Members
mt
Aspinook Corp.*
"
New
York
Security Dealers Association
Wall Street
New York 5, N. Y.
Tel. HAnover 2-8080
Teletype NY 1-2425
Textron Wrnts. & Pfd.
American Gas & Pow.
Cent. States Elec., Com.
Bought
Quoted
EASTERN CORPORATION
Derby Gas & Elec.
New England P. S. Com.
Sold
NORTHERN INDIANA PUBLIC SERVICE
NATIONAL COMPANY
Puget S'nd P. & L. Com.
Southeastern Corp.
Spec. Part. '//'
Southwest Natural Gas
Central National
,
Standard Gas Elec.
tProspectus Upon Request /./■/
'
•
Bulletin
or
Circular upon
'
<
1
22 East 40 th
Corporation
ESTABLISHED 1927 ">
Street, New York 16, N.Y/
Telephone: LExington 2-7300
Teletype: NY 1-2948
request
♦Argo Oil Corp.
General Crude Oil
v,§;'; Di-Noc Co.
£ Stand. Comm. Tobacco
.Osgood Co. "B"
♦Tennessee Prod.
*Wellman Engineering
Great American
Robert Reis Common
Irr ustries
Members N.Y. Security Dealers Assn.
Electro!, Incorporated
*
Descriptive Circulars
on
request
*Prospectus
on
Glenmcre Distilleries
request
N.Y. 1-1286-1287-1288
Direct Wires To
Chicago, Phila. & Los Angeles
ENTERPRISE PHONES
Ilartf'd 6111
Buff/6021
Bos. 2109
Seligman, Lubetkin & Co
J.K.Rice,Jr.&Co
Established
Incorporated
"
Members New
Yurk Security Dealers Association
41 Broad Sov.t, New York 4
Members
N.
REctor
HAnover 2-2100
Bell
Y.
SIEGEI
1908
Security
2-4500—-120
Dealers
& CO.
Assn.
89 Broadway.
>
*.
Broadway
System Teletype N. Y.
1-714
:.
Teletype
»V
nigby 4-2870
1-1942
rVoIume
NY
Inflation, Interest Rates
And Investment
—
f By
Economist and
i V-
•:
•
C '"*•< •:/
' \
•
Economist expects post-reconversion
v/
=By A. WILFRED MAYs
•,//
v->'. «>.y.
-/v.
will embrace high physi¬
production, intensified competition entailing higher business
mortality, prices higher than in 1930's, and anti-inflationary mone¬
tary policies. For investment policy he recommends: (1) Emphasis
on
quality and diversification of risk; and (2) staggering maturi¬
ties in bond holdings, with avoidance of speculation in long-terms.
;
years
cal
moving toward
iraplications
-
clusive effort toward stopping the gross misuse of language as ap¬
plied
- •
v
to
'
i
H
international affairs.
Imperialist, Isolationist,. Appeaser,
;
Aggressor, Liberal, are a few of the terms whose
'y V ■ '■ /'.
imperialism, with which
Wallace, Elliott Roosevelt, et al., denounce
Great Britain, and with which charge the Political
Action Committee is urging the populace to fire a
mail barrage at the President and the Congress.
Its spokesman, Mr. Wallace, first pleads for the
division of the world into distinct self-contained
objectivity.
the
for
well
as
which
qualitative
considerations must
be our guide.
For example, the
demand,.for credit} is only par¬
Suppliers
of
long
and
short
term
-
credit.
tially measurable, the supply of
funds is subject to varying de¬
grees of elasticity, and the risk
factor
for
which
allowance is
is
It
my purpose
to
here
out
chart
roughly
of
some
then
not
ment. While
investment
•
"
The
our
statistics
thinking
supply
of
credit, it would
serious mistake not to give
a
complex forces which af¬
rates comprise the
interest
Conven¬
Life
American
the
fore
including
tion; Chicago, 111., Oct. 8, 1946.
economic life,
only the factors
:; By PAUL ICINZIG
his
"Sermon
carnated
.'country
s
deep
resentment. In
official circles
that
resent¬
ment
became
accentuated
Brown Company
ConsoL Pap. Corp., Ltd. of Can.
Minnesota & Ontario
Canadian Bank Stocks
Abitibi Pr. & Paper- 5s,
contempt. A//;
of the manifestations
that resentment
was
International Power Securities
HART SMITH & CO.
Bell
the
of
New York
and
Curb and Unlisted
Securities
MICHAEL HEANEY, Mgr.
for this decision.
-It
is
1805)
York Curb Exchange
Chicago Stock Exchange
COAST-TO
New Yoft V Chicago >
:
SL Louis
•
-
COAST
matter
of
should
not
Fund
r
of
;/'.<■
Lake
Kansas City
-
Los Angeles
Com. & Pfd.
•
Members New York Security Dealers Ass'n
32
Lane Cotton
Com.
&
♦Raytheon Manufacturing Co.
$2.40 Conv. Preferred
CHICAGO 4
DIgby 4-8640
Teletype NY 1-832-834
Pfd.
-Harrison 2075
Teletype CG 129
prestige
borrow
the
or
T. I. FEIBLEMAN
,
London
that
a
Britain
through
the
Bank, the facilities
Members New Orleans Stock
New York 4, N. Y.
♦Universal Winding Co. Com.
Prospectus
'•
rC
X.
.
<•
*
.
!"
••
r'
.
-'
'
•
t
•
120
LOS ANGELES
•
Preferred
&
Common
Preferred
'
v
-
Dealers
'
Telephone
WHiteball 4-2422
Branch
*Memorandum
on
«
/
"-
1-2613
Office .*-r"
*•
32
Sold
—
,
113 Hudson St., Jersey/City, N. J,:
«...r*.
/
Quoted
*Prospectus on request
-
/
! vIa
Broadway, New York 4, N. Y.
\
FREDERIC H. HATCH & CO., INC.
.
.
'/
;
"
.1/
.,
,
Esteblished 1888 <'{■
MEMBERS N. Y. SECURITY DEALERS
•
;
f
New
•
ASSOCIATION-v-
:
Tel. WHitehaU 4-6430
1 r
c
Tele. NY 1-2500
***.+***» +n^.tku
^
'
83
Wall
Street, New York 5. N. Y. * I
.
^y
.-
New
120
"* *
Bell Teletype NY 1-897
-
CO.
New York Stock Exchange
York Cutb Exch. Assoc. Member
Members
■
,
,
Exchange
NY 1-635
FARR &
PETER BARKEN
Teletype
NY
—
Request
"-*•
New York 5, N. Y.
.
Stock
REctor 2-8600
Quotations Upon Request
Bought
t
*
In- investmentSecurities
62 William St.
York
Sugar Corp.
:
Baker Raulang
MAKER &HULSEBOSCH
r
.
Common
request
&
.
" Vv *
Punta Alegre
American Maize Prod.
-
American Beverage
Brokers
New
Telephone:
®1|1 Dravo Corp
"
"
Statistical data
upon
request •.'
.•;,
Broadway, New York 5, N. Y.
Bell Teletype:
♦American Insulator i
•'
.
on
|V(
/
Common
.
;
Reynolds & Co.
Members
Carendelet Bldf.
Bell Tel.—NY-1-493
Albert Pick
I
•'^
Bo. 9-4432
Mining Issues
'•
Baum, Bernhelmer
KANSAS CITY
Pledger & Company, Inc.
Exchange
New Orleans 12, La.
11 Broad St.
Philippine
^
White & Company
ST. LOUIS
reason
Products, Inc. Com. & "A"
Board of Trade Bldf.
Broadway
NEW YORK.4
Mills
Standard^^ Fruit: St S/S
of the
♦Air
STRAUSS BROS.
Sulphur
Jonas &
use
\
y
in
' New York 6
Teletype NY 1-1610
Digby 4-3122
Galveston Houston
Jefferson
Recon¬
for
another
considered
I,
.
«.
also
WALTER KANE, Asst. Mgr.
;
39 Broadway
struction and Development. There
is, however,
Toronto
Montreal
warmongers!
Inter¬
national Monetary Fund or
Bank
Teletype NY 1-395
Members New
ultimate
semi-bankrupt
on page
HAnover 2-098C
52 WILLIAM ST., N. Y. 5
Direct Private Wire Service
countries.
(Continued
1952 & 1957
Joseph McManus & Co.
regarded in
the
as
the
of
reserve
now
light,
same
the decision
that Britain should not make
facilities
are
6^8, 1955•'/'//• ft:-
•
of Savan¬
nah, where the British delegates
felt they were treated with the
International
the
iating experi¬
/ •
ence
the
institutions
1965
International Power Securities
7s,
Bretton Woods
The two
ments,
Paper Co.
Sun Life Assurance
the
pacifists, abusing the present opponents of dictatorship
,
Co.,;Ltd.;
GiantYellowknife
Settle¬
International
for
Bank
by the humil-
.
,
Paul Einzig
of
Abitibi Pr. & Paper
>
Mount"
the
I
CANADIAN
^SECURITIESJ
And this somersaulting ia the
feelings towards the Bretton Woods system. Until recently appeasement role is nowhere more strongly demonstrated than by
Stalin himself.
At the time of Munich in 1938, Moscow and the
it
was
con-"
of which, it is felt, are reserved world's "liberal'- press launched an avalanche oL attack against Mr.
sidered by the
majority of for second-rate countries. This Chamberlain for his "cowardly; surrender"; of the world's libertythe public as attitude originated between the loving people. But just a year later in August, 1939, in making their
two wars when it would have
pact with Hitler that set off the conflagration, the Russians placed
an unmiti¬
gated evil, and been considered beneath the dig¬ the responsibility for war on "imperialist" England and conversely
saw fit to denounce her for. not appeasing.
The later 1941 triplethe way in nity of countries such as Britain,
which it was France or Italy to borrow through reverse' back to anti-appeasement and war by the Stalin-Molotoy
forced upon the/League/ of Nations
or the
(Continued on page 1830)
* t h i
One
on
lawless aggression £s
v
utmost
I
Noranda Mines
about
LONDON, ENGLAND—There are indications of a change of
caused
of the dinner committee.
man
of New York's Madison Square
group's voluble and ubiquitous leader,
clearly revealed his conception of the world as that typical of an
"arch-isolationist."
Although former America-First haters, he and
his fellow-agitators now almost exactly duplicate that theme by
stressing that'what goes on in large sections of Europe—including
part of Germany—is none of our business, by demagogically pleading
to "bring the boys back home," and! by throwing the outworn
In
■:
Shreve, Hayden, Stone
Co., New York City, is chair¬
"Hi^I
Appeaser is another anti-semantic epithet conveniently flung
to camouflage individual ideology.
Epitomized by Neville
Chamberlain, the many loyal Britishers and Americans who wish¬
fully thought that World War II could be averted or abbreviated, were
mercilessly castigated as disloyal, Fascist and/or anti-Semitic.
But
now the former hurlers
of these epithets themselves are the rein¬
by British Government. Holds this sentiment has changed, because
of theory that if Britain, as member of Bretton Woods institntions
does not borrow from them, she will be actually lending her funds
when she cannot afford to do so. Says Britain is in no position to
indulge in foreign lending.
British
-.
*'
S.
Garland, Alex.
Sons, Baltimore, presi¬
&
tomatoes at the British scapegoat.
Dr. Einzig calls attention to change of British feelings toward BretIon Woods institutions and resentment against use of their services
~
participate iii the Mediterranean and>Middle
East. (And this when the British are clearly and
Garden, Mr. Wallace,
Britain and Bretton Woods
,
/. ■;
The meeting will
Wickliffe
&
to vituperate against Britain for wanting
to
sincerely endeavoring to terminate their long-standing arrangements
in India and Egypt.) So he really means: Imperialism for whom?
..//
meeting
Pierre,
dent of the IBA.
controlling Latin America—but then
of our
and
goes on
.
iJirectly allied to this literal double-talk is the typical obfuscation about isolationism which is continually. inj ected by the pseudoLiberal gang.
In the face of their anti-isolationist epithet-hurling
(Continued on page 1822)
before and during World War I, it is they who have now wheedled
themselves into the exact category which they formerly denounced.;
*An address by Mr. Shields be¬
whole range of our
not
■ ♦ intended meani g fluctuates ad hominem with
.A. Wilfred May
Hotel
Charles
and
orbits, with Russia and ourselves ruling our re¬
spective spheres of influence side-by-side.
He
argues at great length the fairness of letting Rus¬
sia dominate the Balkans and Eastern Europe,
/
business
the
at
...
adequate weight to the psycho¬
logical factors comprising the be-
Shields
Murray
organize
demand for
and
be
must make every
we
the
around
briefly
what
they
suggest as to
fect
to
effort
to
discuss
policy.
quoted rates is vital but
subject to precise measure¬
made in
the
that
appear to be
in the making
changes
and
subject to quantitative
but
many
where
are
measurement
the
In¬
will
Principal speakers will be Rob¬
ert Cutler, President of the Old
Ccflbny Trust Company of Boston,
cliche
Mr.
•
users
as
■
the
Take
15
be followed by a dinner.
-
Brown
emotions of the user; and is stripped of all
the
annual
Oct.
on
New York City.
,
market for credit, we appear now to
market, which would have profound
sellers'
a
hold its
International Word-Slinging
Conforming to the public's growing interest in clarifying "the
meaning of meaning,", the semanticists might well devote their ex¬
.
After 12 years of a buyers'
be
The New York Group of the
-
vestment Bankers Association
MURRAY SHIELDS*
•
Group of IBA to
Hold Annual Meeting
Observations
Policy
Vice-President, Bank of the Manhattan Co.
:; ;
...
1781
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4532
164
;
York Coffee & Sugar
WAUL
ST.,
Exchange
NEW YORK
TEL. HANOYER^9613
•-
vV*.c
-
•
* >
1
Milo Osborn Now With
Paine, Webber Firm
*
(Special
to
The
Financial
Chronicle)
DETROIT, MICH.—Milo O. Os¬
born has becoma associated
with
Paine, Webber, Jackson & Curtis,
Penobscot Building. Mr. Osborn
hag recently been with the U. S.
Ordnance Department. Prior there¬
to he
Manager of the munici¬
was
pal department for
Cray, McFawn
BALTIMORE
Bay way Terminal
Monumental Radio
Davis
Coal
&
Coke
C. A. Reed
Class
B
Common
J
:
,v
,,
.
s
Noxzema Chemical
STEIN BROS. & BOYCE
Members New York & Baltimore Stock
Exchanges and other leading exchanges
6 S.
CALVERT ST., BALTIMORE
Bell
2
Teletype BA 1393
New York Telephone REctor
2-3327
BOSTON
^
Boston Wharf ^
Dwight Mfg. Co.
:v
1
v
American Air Filter
Purolator Products
;
••
•/:'If.'■: '
V; '■
/
•
\
American
Turf
Ass'n
■
-
Descriptive Analysis
request
on
Inquiries invited
\
Consider h. Wiilett
Girdler
•,
Corporation
Murphy Chair Company
Winn & Xovett Grocery
31 MILK
STREET
BOSTON 9, MASS.
HANcock 8200
N. Y.
Teletype BS
Telephone CAnal
424
6-8100
ST. LOUIS
New
England Markets
Retail New
England Coverage
Secondary Distributions
Bank
j
r.
and
Insurance
PHILADELPHIA
Gruen Watch
Stocks
Standard Stoker
industrials—"Utilities;
;C Inactive Securities
Memos
k~
Members
Boston
Exchange
Street, Boston 10, Mass.
Tel.
Portland
Stock
Liberty
2340
Providence
on
INVESTMENT
Company
SECURITIES
509 olive:
Request
Postwar
street
Springfield
Members
New
York,
Philadelphia
1420 Walnut Street,-
Of Securities Market
St.L6uis1.Mo,
and
Los Angeles stock Exchanges
*•:•••••
Also Member of • «•
Nev) York Curb Exchange
By WILLARD E. ATKINS*
Members St. Louis Stock
Exchange
Professor of Economics, Washington Square College,
Philadelphia 2 "
New York
*
DES MOINES
New York University
>
Los
Angeles
Pittsburgh, Pa.
"V Hagerstown, Md.
N. Y. Telephone-—WHitehall 3-7253
Private
Wire
Dr. Atkins
SALT LAKE CITY
System between
Philadelphia, New York
explains methods of Brookings Institution in studying
postwar period business financing and effects of securities market
and Los Angeles
|| regulation.
Asserting there can be little disagreement regarding "
desirability of healthy and free functioning capital markets, he
| maintains regulations should not go beyond preventing fraud or
requiring adequate information.
Holds competitive bidding should
\
not be required on all classes of issues; that investment functions
a: should not be segregated; and that Investment Banking should not
K;/ be decentralized.
Urges greater simplicity* in regulation^ and! i
warns fixed rules cannot operate well under
changing conditions
and new situations in capital market.
-
TRADING MARKETS
for
INCORPORATED
">.v;
-
Present Status of
We invite
Regulation
•
F. L. PUTNAM & CO.. INC.
77 Franklin
Company
South Carolina Elec. & Gas Co
BROKERS and DEALERS
offerings
UTAH
MINING
STOCKS
.
Send for
new memo
r
Established
I89S,,
vs
W. H. CHILD, INC.
Members Salt Lake Stock
Exchange
OFFICE
'
Stock Exchange Building
Salt Lake City, Utah
Stock Exchange Bldg. Phila. 3
Telephone
Teletype SU 67
Teletype
RIttenhouse 6-3717
Early in 1943, Brookings Institution decided that business financ¬
ing in the postwar period
probably
stitute
BROKERS
PHILADELPHIA
|
Phone B-6173
PH 73
the
via
SPOKANE, WASH
Electromaster, Inc.
on
request
Shelter
on
MARKETS
Scranton Electric Co
request
Pennsylvania %
Power & Light Co.
Common
& Dolphyn
Detroit
Stock
SECURITIES
For Immediate Execution of Orders
Exchange
Buhl Bldg., Detroit 26
Cadillac 5752
Tele. DE 507
Quotes call TWX Sp-43
on
under
The
BOENNING & CO.
Phone
to
PH 30
N. Y. C.'
COrtlandt 7-1202
2.
Floor
of
Exchange from 10:45 to 11:30
A.M., Pac. Std. Timer Sp-82 at
the
the
W M%>
m
to
That the investment bank-
rather, it should prepare itself for
a growing period of usefulness,
f
^
JH
we
situation,
began
we
.
feel
We started our study by turning back to the World War I
period. The period in 1913 to 1921-.
1921., The
evidence
we ;>found
there, led the authors to believe
that* important
other hours.
against
Members Standard Stock Exchange
of Spokane
Dealers
is
-
Underwriters
Peyton Building, Spokane
Branches at
Kellogg, Idaho and Yakima, Wn.
1.
two
increasing
to
the
de-
mand for funds, a still
Prof- w- E- Atkins
things:
-
as
production
corporation
Brokers
committee,
business, let us say security
business in general, should not re-,
sign itself to gradual eclipse, but
into
more
economic
ing
tht^ p°ub?ic
1606 Walnut St., Philadelphia 3
Private
way.
more
standard securities
PEnnypacker 5-8200
at-
^EpPM9|H
study got
looked
Stocks
Mercier, McDowell
Members
NORTHWEST MINING
or
Manufacturing Corp.
Report furnished,
TRADING
"
tional
tention..-Thus,
.the
Prospectus furnished
it
give
nee
likely to be important#-'-There would
of
problems
which
to
was
"*•*
con-
one
should'
ad
DETROIT
-
That stagnation in the capi-
more important factor is rising prices. We
(Continued
on page
1828)
V;
tal market was not a more or less
* Address by Dr. Atkins before
permanent feature of the national
the 29th Annual Convention of
the Association of Securities Administrators,
New
York
City,
Sept. 27, 1946.
despite the interpretation placed upon certain evidence
gathered by the temporary naeconomy
1783
Number 4532
164
Volume
Biilish-U. S.
Some Aspects oi
Investment Banking "Marriage"
MacDUFFIE^r':r;
and Exchange Commission, New York City In Cermany
By BRIG. GEN. DAVID SARNOFF*
\
President, Radio Corporation of America
\
/
f
recounting achievements of radio, predicts further
Gen. Sarnoff, in
By E. ALLEN
-
Radio: Past and Future
|
expansion in its
vast
Formerly With Securities
Foresees
of science and scientists.
ment to freedom
(Exclusive to the "Chronicle") \
(1) organization; ;
(2) underwriting; and (3) " distribution,-Mr. MacDuffie stresses im¬ Merger of U. S.-U. K. zones by >
Jan. 1 will overcome many ecoproper distribution in securities marketing.
Holds important func¬
i comic
tion of underwriters is ability to gauge market and urges that issues
problems. Will entail bet-1
be properly placed and not absorbed by "free riders/' Says SEC,
/ ter
allocation
of coal
and'
;;r; in processing registration statements, protects issuer and under/ increased mine'output.
/ writer as well as investor, and advises making sure of facts as well
BERLIN, Germany.—Interview¬
ed by the "Chronicle" on prob¬
as strengthening a corporation's organization,
"so that five years
lems and advantages of the
after the financing you will be proud to hear the name of the cor¬
economic merger of the British
poration which obtained capital funds through your firm."
and American zones, an American
Stating functions of Investment Banking as:
;
Ascribes advance-
and usefulness.
progress
new
j
and ter-
.
rible weapons in war,
that
'
and cautions against complacency, urging
keep strong, morally and physically. Says advances in
are boom to world peace
and concludes we must, with
and vision, continue unceasing exploration not only in
we
science
courage
;
;
physical sciences, but also in political and social sciences to secure
world peace.
Sees possibility of science converting deserts into
gardens and controlling weather.
-
achievements
The
of
radio,
from
1906
reached
have
1946,
to
heights of greatness far surpassing any dream that anyone of us had
in the begin-$
n i n g.
official said:
T h e its magic.
The American radio
Now that people are clamoring for meat rather than new secur¬
wonders ac- industry's splendid record of ac¬
ities .issues, we have an opportunity to calmly appraise the past 12 // "To a considerable extent the
c o m plished
overall economic problems posed
complishment, in peace and in
months'
se¬
represent the war, is worthy of the finest tra¬
did you think the situation was by the zonal division of Germanycurities
busi¬
combined ditions of our country.
will be met by the 'marriage' of
like the '20s?
ness. Such ap¬
The aid, encouragement and co¬
In
addition
to the
vision, energy
many
old the British and American zones,
praisal
may
and ingenuity operation of the Army, Navy and
approaches that were dusted off through the better allocation of
guide
our
of countless government scientific agencies de¬
coal and increased mine output.
and used, the situation was;i like
."future
activ¬
scientists and serve the fullest recognition. It is
the
'20s
in
some
fundamental The merger will make possible in¬
ities.
engineers, difficult to over-estimate the con¬
■<*
The
respects. First—the abundance of creased rations in the British zone;
past
"At present both Britain and
planners and tributions of the military and
has -'been
a
money seeking investment made
1
;
hectic
of
W
v
it
period
e
is- /
new
.
dispose
issues
of
very short; period. Sec*
ond—the risk of having to carr#
ail
unsold issue was greatly re¬
have
^
seen
possible vto
within
extremes.
a
industrialists.
In/our zone Congress cut
tribution
for
this
to
year
ment
radio
our con¬
fiscal
naval
Through their
efforts, new
America are contributing to the
support of their zones of Germany.
the
radio
inven¬
sold
'
Third—as
duced.
being
at
result of the
a
there was in¬
in the invest!
banking business. Not only
easy money market
creased competition
pre- '
and
govern¬
and
electronic^
Likewise
Communications
Federal
around
Commission is to be complimented
an
for its efforts to expand
tions
and
$120,000,000. The UK has
Gen. David Sarnoff
services have
appropriation of £100,000,000,
but this is reduced by the amount
emerged for
miums
of
as
use
of people everywhere.
•of German exports from the Brit¬ the
ment
much
as
20 ;
The applications of radio are so
were
new
investment, houses or¬ ish Zone, so that Britain's net con¬
E. Allen MacDuffie
points on the
manifold that virtually all phases
ganized but the fiefaiof invest¬ tribution is considerably less than
day of the of¬
the figure mentioned.
American of economic, social: and educa¬
fering. - Persons who knew little ment banking was iiiVaded by se¬
tional life have been benefited by
curities iirms that/heretofore had practice is to credit to a special
more than
sues
laboratories
scientists to the advance of
the great
broadcasting, to ad¬
world-wide radio communi¬
service
vance
of
cations,
encouragement
the
for
given to American radio amateurs,
and for helpful assistance in ex¬
tending radio into new fields such
the name of the issu¬
as
fund the proceeds of exports from
aviation/and television.
ing corporation bought new issues been only dealers/';-//
As I look around me tonight, I
*An address by Gen. Sarnoff at
The dealers,ywjth 'their ability the American Zone
I at ' premiums even while com¬
"The merger of the two zones dinner
commemorating
his
40 see distinguished leaders of com¬
plaining they could not buy at the to gauge markets, had initially
should be fully in force by Janu¬ years in radio, New York City, peting
organizations who < have
more experience in the securities
^offering price. How many times business than
(Continued on page 1814) *.
/
/
some
other firms ary 1, but cannot be expected to Sept, 30, 1946,;
be completed before that, since the
address by Mr. MacDuffie prior to their entry into the in¬
British are tied up with, the soat Dinner. Meeting of the New vestment banking business. • For
called Spartan Plan, involving de¬
r.York
Security Dealers!^ Associa¬ example, Lehmans were in the
tailed economic planning accord¬
TRADING MARKET IN
tion, Oct. 8, 1946. Mr. MacDuffie cotton trade; and J. & W. Seliging to end products, as contrasted
man were in the mercantile busi¬
is a. member of the law firm of
with the American system of plan¬
ness.
They also moved into this
McLanahari, Merritt & Ingraham, new field of investment
ning rather according- to basic
banking
commodities. The .detailed plan¬
New York City.
(Continued on page 1829) /
Common Stock
ning involved in tKFSpartan Plan
.
...
.
.
South Carolina Electric & Gas Co.
is
Bull
Bear Market?
or
"Our
W/l&BSON
By ROGER
Zone
i
\
Lptters and telegrams are coming to. me asking ^whether the
counjry is now in a "bull,? or "bear" market. This -is a good deal
J.-"'*' ;
/'■'•- /? $ like asking an^
/
whether
is
to
boy
she
have
witness a 'Communistic Scare1;
during 1946; but they should
cover
soon
Those
a
re¬
thereafter."
who
trusted
in
and
me
girl. followed these Annual .Forecasts
The simple
.should; have / been; prepared for
truth
is
that what has happened..
the
or
a
break has
not sufficient¬
ly adva need
to
.
be able to
whether
say
this
".
or
is
a
bear
a
ket.
/and
•
bull
mar¬
'Anyone
could
Roger W. Babson
•
guess
many
will guess cor-
-rectly; but it is not up to a^tatis>tician to guess about anything. We
•
may
be in
may
•
be only
ment in
|g|
a
bear market
a
corrective
a
bull market,
this
or
In addition to the present break
being
Communistic
a
Scare,
it
due to the arbitrary and un¬
reasonable demands of labor. The
was
break really started with the rail¬
road
man's
strike
veto
and
of
President
the
Case
Tru¬
Bill.
especially disastrous during
the trucking and shipping strikes
New; York
nearly put its
business..
(
newspapers
out of
who lived
and have
for
readers
area
to
on page
in
all
German businessmen in
other
the
hand
bizonal:1 merger
"If
''
Stalin
continues
world's
lives
good,
most
world
•production.
and
his
he will
powerful
1946 and may
cerning
'V';
be
a
man
in
lines of
the
as
\
WHitehall 4-4970
"While
well
as
may
"
four basic
we can
common
processing industries.
Nazis quite a blackmarket activity developed in Ba¬
varia in the manufacture of ci¬
Preferred
the
To be distributed
/
•'
vilian
goods.
The resultant ca¬
pacity and knowhoW still exist
and will
now
be very
(Continued
Dealers
Ass'n
dividend to General
as
Public Utilities Corp, stockholders /
.''.v'rf V/:C.••
•••'
*''•?
BOUGHT
*/•./'
—
'
'£
(
.•
••
•
V: • ' •£"
/
:
'
SOLD
•
'
—
//
''7
^
V
-V
','v;
••.-*.?%.*, {*
*V
QUOTED
1830)
;
v -
New York Hanseatic Corporation
Bought—Sold—Quoted
|
120 BROADWAY, NEW
YORK 5, N. Y.
.
Teletype: NY 1-583
Telephone: BArclay 7-5660
;...
V
^\
/ £< /
... •
•/.
-
» -
-V
OFFERINGS WANTED
Allerton N. Y. 3-6s 1955 W. S.
Beacon Hotel 2-3s 1958 W.
H. D. Knox & Co., Inc.
11 Broadway, N. T. 4
NY 1-1026
27 State St., Boston 9
DIgby 4-1388
Tele. NT 1-86
150
Established
1926
Shcrnetb 5% s 1956 W.
S.
Wall & Beaver St. 4V2S 1951
51 East
Tel.
Broadway
BArclay 7-4880
W. S.
42nd St. 3s 1956 W. S.
500 5th Ave. 4s 1961
W.S.
&1C0.
Incorporated
Tele. BS 169
,
Roosevelt Hotel Common
Savoy Plaza Class A
AMOTT; Baker
Tel. Capitol 8950
W. S.
1956 W. S.
Pittsburgh Hotels Common
Roosevelt Hotel 5s 1964
Brooklyn Fox Common
Eastern Ambassador Hotels Units
•V
Natl. Hotel Cuba 6s 1959
N. Y. Majestic 4s
S.
Broadmoor 4s 1956 W. S.
Tel.
Broadway, New York 6, N. Y.
BArclay 7-0570
•
useful. This
on page
(RICHMOND CEDAR WORKS);
F.H.Koller&Co.,inc.
Security
'
many
Under
Hotels Statler Common
Y.
v;5£:;/|a||
When distributed
Hotel St. George 4s 1950
N.
j
Teletype NY 1-609
South Carolina EIec.,& Gas Co.
contribute to the
chiefly food, the UK zone
can
contribute
coal
and steel
needed in the U„ S. Zone, which
merger
Hotel Lexington Units
111
New York 5, N. Y.
" 1
points set'
Hotel Lexington Common
Members
November
1816)
*
health
the
on
share of General Public
one
Corp* Common 'Stock.-
Brooklyn Fox 3s 1957 W. S.
&
distributed
be
to
Under the
Hie Cross Company
Common
is
70 Pine Street,
.
forth in the September 5 press re¬
lease.
•
/..■ •'
am
If
share
holders of each
A.Saxton & Co., Inc.
G.
zone
rea¬
be
markets
Utilities
c.
factor in de¬
prices
The
to
there will be a
policy. along the
ration
common
our
bought sugar
from the Russian Zone.
has
distributed"
For
foods.
1946 they will find
that Forecast Number 32 reads as
'
-
cattle to the USSR's Zone.
some
-Forecast for
follows:
15th
American
Annual
my
One-tenth
example, we authorized the sale
of
■:' r.v
situation.
a
refer
the
"when
1
the larger agricultural
of the two, though it is not
move-
given various
such
will
the
in
! /
•/In previous weeks I have been
'.suggesting that this break would
sons
5
-
■
has
Break Not Unexpected
•come
r'
City, add 'which
Headers
(Continued
eco¬
'
r
We have
military stocks
It
was
irv
>,? ■
-
contribution to
self-sufficient
on
even
main
"
put in some of our
food.
Besides,
arbitrary and unreasonable demands of labor; thinness of*
market; and possible bombing of certain large American cities.
Urges small investors be'protected in same way government pro¬
expectant
mother
security than an
of
scare;
depositors.
a
measure.
bizonal merger is food.
Mr. Babson holds it is. too soon to determine whether we are in a
bull or bear market, and ascribes recent decline to a communistic
tects small bank
more
nomic
New York
7, N. Y.
Teletype NY 1-588
1784
THE COMMERCIAL & FINANCIAL
CHRONICLfi
that
ever
no accurate conclusions
drawn until the SEC has
be
can
revealed
its
findings
on
one
The Stock Break—
or
both plans, or proposed a plan of
its own. EBS in presenting its own
the
1
and
large number of utilities
of
in Latin America and some inter¬
mon; and
ests
shares
in China and India.
these
Many of
acquired at prices
were
not
58%
.
has shrunk along with
deterioartion
in " exchange
-rates, and huge arrears have accumulated on the parent com¬
pany's
three
preferred
stock
Electric Bond and Share invest¬
ed about $277,000,000 in Foreign
iPower and the public also put in
a
large amount (system assets are
carried at over $600,000,000 in the
1945 balance sheet). EBS's various
holdings of senior and junior se¬
curities
are
wise about
mated, but
a
worth
now
market-
$119,000,000, it is esti¬
even
substantial
this figure includes
amount'of
"water"
since .the junior securities appear
'substantially over-priced in cur¬
rent markets (the first
preferred
issues
on
the
other
hand
receive in exchange for holdings of
bonds, notes, preferred and
com¬
stocks
mon
and warrants,; about
,$8,000,000 bonds and cash and
some
three-quarters of the new
•^common
stock. Public
.Foreign
Papers-securities "would
•
receive
holders of
about
$113,000,000 bonds,
$15,000,000 cash, and about
over
one-quarter
stock
the
of
issue.
The
new
common
company
thus
.
-voluntarily wrote off a large part
/of its original investment.:'This,
years
common
(the
EBS
the
of
new
go to
one
ture 3s due
1967, $80,000,000
this
tional
I
- earnings
statement (and
disregarding the proposed sinking
fund), there would be a balance
of about $9,400,000 for the com-v
morn stock or $3.76. a share
(the
stock
be
the
worth?
new
common
Brazilian
Trac¬
cannot
it
Otis Opens
new
plan
proposed
by the
•group representing this stock does
not greatly alter the
original plan,
but
.
the
cuts
new
down
EBS's
common
holders
would
for
the
of
new
the
j
break
5%
of
ment
Gilbert
tion, Light & Power, which might
Manager: of the
fice of Otis &
American
Foreign Power, - is
currently selling on the Curb at
21, or about seven times earnings.
Trust
The yield (after allowance for the
15% Canadian Tax on the $2 divi¬
dend) is
8%. On
over
a
compar¬
able. price-earnings-yardstick the,
new American &
Foreign Power
stock would only be worth
26.
However, considering the indicat¬
ed speculative interest in
Foreign
Power, it might be expected to
sell .(initially at least) at some¬
Canfield
B.
ing,
new
as
Buffalo of¬
Co., in the Marine
Build*
held
the
of
various
securities
by the Dublic would work
out about
follows:
as
r
•;
vv
$1,075
debenture;
in
new
the
$7
3s
pre¬
■■■'■'£;■ :■ Market
-Est. Value Under-
About
Plan I
Plan II
106
106
$7 preferred
107
118-123
125-135
94
116-120
120-128
22
13-18
44-61
6
y2-3/4
Nil
Nil
Nil
$6
preferred
2nd
preferred
Common
Warrants
ferred would receive $100 cash
per
Bates
IVt
It should
107 >/2
be emphasized how-
wasanrs
n o u n c e
I would
tors
k
a
d-in//
new
"-M
was
issues.
true
was
felt in the
the feel for the
market
or
marketability
field brings :
to this posi-fc
tion
of
23
—-
/
years
„
v
Inventories
heavy, and sights
were
the six-months
on
ture.
Traders and salesmen
thinking
tax
were
their / personal
of
more-
brackets
tomer's
fea¬
tax
and
their
not
cus¬
employer's conditions
or
or
problems. We had multitudes
of money in the hands of the mul¬
titudes.
.
Ordinary
week-enders
taking prolonged
were
of luxurious
vacations
lengths—four weeks,
*
by the
traders,
(Continued
1832) i z
on page
foreign trade and
associates
before he and
formed the T. H.
times
essential,
are
not
■
a
Says foreign loans, though
substitute for domestic imports.
John L. Battel and Clair Kramer.
Mr. Canfield is the son of the
we are
sider
quirements
of
export,
let
us
first
take
a
Oil
member of the
Athletic and
Park
Clubs,
But
since
to
<$>-
con¬
the
The various regions and nations
of the world
re¬
are not equally fav¬
by nature in potential
wealth; the skill, efficiency and
aptitude for social organization
ored
a
careful look to
see
and
what For-
active worker in
drives for. the Red Cross and the
Community .Chest.
-really
volves.
Washington
on
Street,
New
York
one
funda¬
mental
princi¬
ple and a few
indispensable
E,
I shall
heimer &
Co., Inc., has become
as¬
sociated with their firm.
power,
the fortunate
resources
George W. Wolf
at-/:r;y ///v/V/ //•
tempt to establish this
mental
existence
principle.
one
funda¬
It follows:
with
other
conditions.
Birkins, formerly with D. F. Bern-
of their
widely.
climate, richness of
of minerals, not
found elsewhere, or their superi¬
ority in quality and concentra¬
tion, adequacy of cheap and plen¬
tiful
thermal
or
hydroelectric
soil,
,•
Trade is based
Company, 107
endeavors
differ
Favorable
in¬
' :o/:r;
collective
inhabitants
eignTrade
an
some¬
The organization requirements for successful
export business are
as to fundamentals than for
any home, business.
no
founder
.
different
sentative in 1943. Associated with
him in Buffalo will be A. J.
George R. Canfield,
•
changes that have occurred in U. S. inter*
notes
risks in international business.
Saunders Co., investment Dealers.
Mr..
Canfield became
Otis
&
Co.'s western New York
repre¬
Todd,
""
=
,
oat fundamentals of successful
Stresses value of foreign trade to
developed and undeveloped, and urges
more
attention to increased imports.: Outlines
organization re¬
quired for foreign trade operations, and concludes that since we
cannot go on selling without a final balance, in our international
payments, each exporting concern must properly evaluate its own
Gilbert B. Canfield
vestment. De¬
partment
of
the First National Bank of Cleve¬
his
Export Trade
lor
-President, United States Steel Export Company
national commercial relations.
all nations, rich and poor,
;
City, has announced that M.
Y.f
:
were
Prominent; export executive points
"v
experience
George Birkins
29 BROADWAY, NEW YORK 6. N.
law
.
of
Foreign
Co.
.
will
Timing—The timing for all this
to take hold was perfect. We had
the Street "lolling in its success."
new
unrecognizable,
don't
maintained,
long posi¬
never; have or will.
always be governed by
of supply and demand.
By GEORGE W, WOLF*
With Geo. Birkins Co.
Direct Wire to
Chicago
the
Requirements
v
and has been
&
•
We
timing
Therefore, when the
come
in" them—either
Staley Common
Gilbert J. Postley
tions/.
^
for
markets
are
of this
the
r.Oaa^
Buffalo
Robbins & Myers Common
/
and
enthusiasm
"break" did
connec¬
they
everyone
has
when
security
acute weakness in the older issues
Daley,' Presi;
/. ,...
dent.
Company. He is
Hallicrafters Common
of
causes
./.
-
items.; There
content, relaxing
bull
nor
the
main
sharp b re
thereof: '
up
But
"$25,000 mil¬
long positions and
offer the following facr
That's basic.
the
as
rolling
done.
Oct.3 3,;by^
William R. ;
and President of the Canfield
Manufacturing Pfd.
A. E.
trend
markets.
land for ten years
Recent
Z:
Reilly
the old issues didn't exist. ?: There
had not been any recent interest
what better
values
F.
a
the
were
that
start,
John
Cleveland
&
Bonds
plan
public
debentures
and
of
in
know
in
in
be
to
excess
getting into the latest
"hot one" or "daily double."
You
BUFFALO, N. Y.—The appoint¬ for weeks before it
.
All
tions
definitely
a
needed
was
an
in their
#mere .£■ re¬
action.
It
is
late
obtain
each
'
■' ;
justify
sell-off
a
issues and lack of attention being
given the older and more seasoned
Office Under Canfield
be comparable in some respects to
in
from about 76%
to 42%.
Under
interest
as
to: the
Buffalo
work
had
lionaires" in and around the busi¬
I
or
-
The
it
for
The Securities Situation—I refer
figure under the old plan would
apparently be somewhat lower). '
would
that
Foreign
Power would be fairly treated in
any such purchase.
recent
What
indicate
to
seems
the basis of the
on
Tel.
and
we
term
values.
Sleeves
cent.
and
ness.
over,
& Tel.'s properties is
considered a fair settlement and
debenture 4s and 2,500,000 shares of common stock. The
new fixed charges would be about
by
quick break.
"break"
in
The Personal Aspect—Everyone
was
a
little too fat and compla¬
tremen-
dous
However, the price of about $95,- value
000,000 recently paid for Interna¬ break
con¬
downs
been
not
Conse¬
customers.
or
quently, confusion that led to dis¬
organized quotations and mark-
any
disturbed
since
President Peron has indicated that
vertible
$4,250,000 and
or
salesmen
security
has
he wants to end all foreign inter*
ests
in
the
nation's
economy.
them
take
levels—possibly in the in the secur-'n
30-35
holders of the sceond
range.
Assuming a price ities field,preferred
stock (who own about 15% of the range of 25-35 for the new stock having beenas a working
issue versus 85% held
hypothesis, market with the I n
by EBS).
however, did not satisfy public
person
a
691,842. Under the latest proposed
plan the company would issue
$35,000,000 of sinking fund deben¬
to
markets—stock,
pal, rail.
No
individual
involved
too
guess, the final plan may be some¬
where between the two plans al¬
stock
common'
is
to be discussed here. To hazard
Forecasts end of
bond, munici¬
public over a period of
though on the other hand
is giving up
some
of its
subordination
of
stock and warrants would
expects postwar economic readjustment.
bear market at 152 for the Dow-Jones
We have witnessed and felt the
repercussions of the 46-point reac¬
tion in the Dow
Averages. It has taken its toll in all
senior claims. The whole problem
old
of market break to technical
causes
factors,
Averages.
the
and
com¬
wish
appear
somewhat undervalued).
In
the original
plan Electric
Bond and Share suggested that it
new
:
EBS
30, Foreign Power reported a bal¬
ance for interest
charges of $13,-
is-
>sues.
new
investments: of
public holders—19%
to the old $7 preferred, 10%
to ready proposed.
the $6 preferred, and 29% to the
Regarding Foreign Power's pro¬
second preferred. *;• j
-V
% perties in the Argentine, it is pos¬
In the 12 months ended June sible that the government might
earnings
the
of
participate). Under the plan
would
the properties have proved
steady
earners, the dollar value of the
share
a
the second preferred 1%
of
common
re¬
flecting relatively high foreign
exchange rates and while most of
respective
one share of new1 com¬
the $6 preferred, $100 cash
4/5
treasury),
ever, may not take account of the
relative income received on the
j
American & Foreign Power was®
incorporated in 1923 and during share and
mon;
Power
stock. But this percentage, how¬
top
company than the 1944 plan.
Foreign
Dealer ascribing immediate
which perhaps explains its assign¬
ment to itself of 7-3% of the new
Power, but the SEC has not yet published its findings.
Norman Johnson group of second preferred stockholders filed a new
plan with the SEC, which is considerably less favorable to the
a
By JOHN F. REILLY, J. F. Reilly & Co.
equity ($262,700,000 of the
$329,100,000 equity cash paid into
Foreign
Recently, the
the 1920's and 1930 acquired con¬
Why? What Next?
stock
About two years ago American & Foreign Power and its
parent,
Electric Bond and Share, filed a plan of recapitalization for
trol of
|
plan indicated that it had contri¬
buted 80% of the new common
The New American & Foreign Power Plan
Thursday, October 10, 1946
to
and
location
respect
the
-
to
centers
of
eachi
of pro¬
duction and
consumption, facility
transportation, and other phys¬
ical factors, render a region par¬
ticularly adapted to the produc¬
of
of
tion
certain
commodities.
On the side of human character¬
Birmingham Electric Common
Carolina Power & Light Common
Carolina Power &
Southwestern Public Serv. Common
istics, marked proficiency of the
labor of one country in* special
crafts, exceptional talents of its
leaders for organization, manage¬
Light
ment
S-0-
Common /•/■:
(When Distributed)
—
SOLD
—
QUOTED
people, of all classes, to work
together in a common effort for
NEW
ESTABLISHED
1879
common
Laurence M. Marks & Co.
MEMBERS
PakWmb, Jackson & Corns
administration, healthy
environment, ability of
its
•
a
BOUGHT
and
political
South Carolina Electric & Gas Common
NEW
YORK
49 Wall
YORK
CURB
STOCK
EXCHANGE
EXCHANGE
on
paramount
are
1835)
page
*
*An address
(Associate)
the-
Street, New York 5, New York
Telephone HAnover 2-9500
goal,
(Continued
>
.
Teletype NY 1-344
meeting
by Mr. Wolf before
of the Management
Division of the American
of
Mechanical
30, 1946.
-
.;/.
Society
Engineers,
•
-
•
Sept.
••
:J/'
Volume
164
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4532
.
Baruch Defends His
1785
Support The
tOvV^sV's-'
RED CROSS
AFL
A
In accepting
;
'
"Freedom House" award, he admits plan impairs na- tional sovereignty principle, but asserts it does not impair any
country's national dignity or national security. Says U. S. asks
| nothing that it is not willing to give, and holds effective atomic
" control is a
path to peace.
'
i Says its goal
<'
?
>
In
on
Oct. 8, broadcast over
Free¬
Annual
dom
address
an
House
ouU>
lined
'
the
a
new
of t-
plan
his
be
violate
who
those
commit¬
for
veto
no
their, solemn
agreements."
inter-
for
tee
must
"There
I
Green,
Harry S. Truman, on Oct. 8, sent a message to William
presiding at the 65th Annual Convention of the American
now
happy
am
and
war
whereas
chaos,
To delay may be to die.
The time
preventive
punishment would be
between violation and
pepetual peace.
action
or
all too short for extended discus¬
The text of the address follows:
sion
as
the
to
to be fol¬
course
This award, if
deserved at all, lowed."
This peace we are enjoying—if
primarily by my de¬
voted associates who have helped that be the right word—threatens
is deserved
formulate
me
atomic
the
the
proposals.
Secretary of
Senatorial
tain
given
full
program.
American
President,
The
to
torian
State, and
cer¬
have
advisers
authorization to our
That
program
still
stands—generous and just.
no
amount
of
what
become
German
said peace is:
terlude between
Never
j Moreover, this obligation is laid
upon you
called
co¬
.
the opening words
of the American proposal so true
as
they
this time: "We
are at
are
choice between
a
1833)
on page
»To
nite
clear. Now, more than
organized labor must speak
and
ever,
for
7
We
Press,
says our
basic
problem is to direct our abilities to peacetime production and
through trade and sound financial assistance to enable other conntries to rebuild.
Pledges Commerce Department's aid in helping
business, "particularly small business," in meeting needs of people.
W. Averell Harriman, on Oct. 7, just after his induction as the
new
Secretary of Commerce, issued a statement to the Press in which
;'v.
he called for<£and bal¬
more
anced
produc-
duction
solve
our
diffi¬
mestic
culties
and
other
aid
to
do¬
tions
na¬
to
build.
to
re-
| He
pledged
the
Department's
aid
to
ness
busi¬
in
the
small
W. Averell Harriman
busi¬
ness." The full
,
,,
'
text
the
of
statement follows:
.1
have
come
to Washington
demonstrate,
demonstrated
eration of Labor.
must
capacity holds out
workers
This convention
as
abundance
secure
America's
and salaried
wage
well
for
as
our
farmers
business
and
professional
But to reach this goal we
use
all
of
is of deep significance because the
materials
and
officers and members of the A. F.
need
full
the
our
and
neers—men
factories,
By
and we shall
cooperation of in¬
men,
definition,
cludes the
long record of gains for
those who labor.
Many of these
this
goal
terms, in better wages and work¬
of homes
been
felt
are
and respect for human values that
is the true symbol of freedom.'
labor's
bor's aims.
a
it
labor.
I
that
accident
no
who- doubt
question la¬
always, the
challenge must
that
as
within the
from
come
ranks
confident
am
that
allies
tions
and
as
forces
of
all
for
Now that
in
the
from
our
of
tion
effort,
I have
some
Very sincerely yours,
HARRY TRUMAN.
.
pleased to
ore
announce
that
glad to express in a few words
general attitude in taking on
the job of Secretary of Commerce
and becoming a member of the
faith
WM.
in
the
but
ability
(Continued
from
tremendous
of
of
be able to
victory
resources
with
their
in'.
Oh,
our
over
governments
who
had
back to sleep late
till 6:30."
As
'4:.7
;,! 63
77
visit progressed, I
began
Pop termed
"easy putterings". He proudly
to
our
see
of what
some
showed
his rock-garden. There
me
sloping terrace of rocks,
was a new
over a hundred
rock-garden
flowers, which he planted. Then,
looking around, I remarked, ";say,
Pop, I don't remember this re¬
taining wall—when did
this built?"
Pop
.
■;;7'
;7'-.;7 44:; ^;-:"-7 7:4' :7-4
7
..
.7
■■
gave me a
retiring." After which he
hibited
a
requiring tiine, skill and labor, in
making, during his life of
the
"ease".
f
me
of the story
of faithful service,
pasture and then
he
That
was
was
old
though he had
-
again,
was
put
day
just right, he
clang of
nibbling the
fire
gave a snort,
blue-
horse
on
as
him
gathered all of
head to
can
one
wager
Ae'il
♦
"Pop" Muenzenmaier
sure
and again, cocks his
that if he hears the call,
answer
it—retirement
or
no
retirement.
."4
•
4
/
4'
\
V 7
;
7
■
7.
.
7'
7'
7 77 7;
,
"Don'tsell
an
old fire horse short."
Kingdom 4s, 1960-90
-
96-Page Book
containing reprints of
;
.
'"7'
.
•
.
■
1
.
'
Bought
•
—
-.4
'
...
•
Sold
7.
:
—
.V
:'
earlier articles
subjects.
Quoted ^
on
Mail
various
coupon
to
MASK MERIT OP SCHENLEY
DISTILLERS
Inc.
18A,
■j
Goodbody & Co.
N.
350
CORP.
Fifth
Y. 1, N. Y.
>
DeifL
Avenue.
.
Name-
Members N. Y. Stock Exchange and Other Principal Exchanges
115 BROADWAY
Telephone BArclay 7-0100
NEW YORK 6, N. Y.
-
All of which elicits the remark
.74'
:
Street—
Teletype NY 1-072
City_
7
side and listens. You
-FREE—
Broadway, New York
had
head,
strength and leaped over the
rails, and was on his way back to
I'm
United
165
of
—one
check-rein
a
and answered it
1829)
been
ex¬
half dozen other projects
his old fire house. He heard the call
Wall Street, New York 5, N. Y.
my
COMPANY,
have
you
disap¬
pointed look—and said, "what do
you mean—did I have this built?
October 8, 1946
.
HODSON&
v.
,
7,'
memories. He raised his
BRITISH SECURITIES
over
preparing for war for years. The
job that the free people of the
United States did during the war
was superlative in every way—in
the fighting qualities of our sol¬
mouth'; then I'd turn
and go
grass.
organization
ruthless enemies under totalitari¬
an
—the alarm clock. You
yes
know, for awhile I kept setting it !
at my usual waking hour—5:30.
{
When it went off I'd just say, 'Aw,
,
to achieve
allies
Pop said, "well,
I'm taking it easy; just puttering
around a little bit 'to keep my hand
his
my
bilized their
forget the tinkle of the
alarm clock?" And
from where
DISTRIBUTORS GROUP, INCORPORATED
confidence
experience overseas I
had an opportunity to see the
amazing job we did in the war.
The people of the United States—
a free and peaceful people—mo¬
a man
leisure; and how does it feel to
in the people of the United States.
From
'Top, how's It
going; how does it feel to be
tops of luscious Kentucky
and vitality
on page
active
fire engines a considerable distance
T. COBB
has been appointed Advertising Manager
President's Cabinet.
have
Cincinnati I said,
pauses, now
involved,
very
heard the sirens and the
to
culties
a
7j777; 77 :|7vj7:7 ;r77;;/ 4,
—when the wind
derstanding of the serious diffi¬
I
—because he has had
life. 7, 77
un¬
go to work.
I would much prefer
to say nothing just yet, but I am
my
ment, and what it is doing for him
I built it myself, in my spare time,
have returned to
reconversion
much inter¬
discovering how he is
employing his well deserved retire¬
out to
■
wholehearted wartime concentra¬
Pop is "getting
was very
in
years
We
;
we
—
the old fire horse who, after many
our
peacetime activities, it is but nat¬
ural that we face grave problems
ested
since
most successful convention.
a
the
thqir civilian popula-.
well, 71
the
Congratulations and best wishes
on
the
to
and Benefit Plan.
on," and I
life
a
security
Schenley Retirement
Which reminds
the farms, in the
shipyards and in the mines.
We
not only supplied our own armed
forces with effective equipment
and supplies, but gave vital as¬
sistance
of
will be eager to reply.
great moment in history
is
Now,
to
answer
bor, my chief desire is to look
ahead, to the immediate task and
responsibilities that lie before you.
and
are
those
motives and
delegates to this great convention
But in offering congratulations
to the American Federation of La¬
This is
*
v
.
There,
:;
assured
with
creed,
in millions
throughout the land,
payment of substand¬
just as it precludes in¬
flationary prices which eat away
real purchasing power.
It pre¬
cludes oppressive child labor and
discrimination against any group
regardless of sex, race, color or
measurable in economic
and
ease
shut your
pre¬
ard wages,
a
alike—in
women
in
resources
dustry, labor and government.
has
which have
"Pop"1
company,
Well, when I visited him down in
Today, no less than in war
time, our most compelling need
is full, sustained production.
Our
people.
are
of faithful
years
our
thanks to the
cratic nation.
and
standing
achievements
of
the
workmen, managers, and engi¬
the
as
tical with the goals of our demo¬
convention of the Amercian Fed¬
'
/.
must
did during the war, that the
goals of organized labor are iden¬
you
diers, " sailors and airmen under
fineleadership arid in the out¬
United States,
"particularly
behalf of all who
the promise of
contributions, equally vital
to the workings of democracy—
the growth of social consciousness
New Secretary of Commerce, in statement to
act in
and
labor.
other
Harriman
4 •-
at
me
..
'
*
least, the part that
organized labor must play is defi¬
'
picious occasion, the 65th annual
gains
many
Muenzenmaier has retired to
for
enduring trusteeship
After
service with
of
I very much regret thai I can¬
not be with you on this most aus¬
brought
;
*
-
the world may be at stake.
Dear Mr. Crreen:
This
-
American people but the peace of
ing conditions, in improved living
standards
and
greater security.
Beyond ' these § tangible benefits,
More and Balanced Production:
at a time when not only
and security of the
welfare
the
of L. are among the chief cus¬
brief in¬ todians of American democracy.
a
wars,
By MARK MERIT
„
,
his¬
were
And here to make
cre¬
(Continued
deliberately
a
:
...
would be opened for dis¬
way
astrous
SCHENLEY DISTILLERS CORP.
to play—a long record of
Continuing
service
has
earned
them that solemn right,
.
control would open up a road to
7
■
part
democracy
to
Americans. This is number 144 of a series-
members and leaders of organized
labor now have such a decisive
cago, in which
he lauded the
upon it
that
-
appear an advertisement which
hope will be of interest to our fellow
<£-
of
Labor at Chi¬
and
space,
there will
we
Freedom
operate with
House chose this text, for it ex¬
atomic con-both industry .■
trol
emplifies one of the weightiest and
and;
govern¬
points in the American attitude— ment to secure
upheld
t h e;
the non-application of the Great
principle that
abundance for
Powers' veto to protect offenders,
it should
bev
wage and sal¬
once a
treaty of prevention and
permitted t o
ary earners as
punishment dealing with atomic well as farminfringe on
President Truman
energy has been agreed upon. Our
sovereig n
ers and. pro-v,
proposal is concerned with the fessional
power of na¬
Bernard M. Baruch
people and to preclude
veto power only as it affects this
tions. He as¬
"the; payment
of
sub-standard
particular problem, and not with
serted
t h a t#
wages, just as it precludes infla¬
America gets nothing that it is not the general veto written into the
tionary prices which eat into real
willing to give and warned that if structure of the United Nations. purchasing power."
As to the veto, I repeat: "The
effective control was neglected,
bomb does not wait upon debate. 4 The text of the message follows:
the
national
SCHENLEY DISTILLERS CORPORATION
NOTE—From time to time, in this
ir, President
ated
confusion \ shall ; prevail
organization*
against it.
V'-v >-5,' as a custodian
The plaque reads: r •;7;;77jd7V.:;
of American
v
Award,
Responsibilities
custodian of American democracy should be
a
cooperation with industry and government in precluding sub-standard wages and inflationary prices,
7^777-.
Federation
the Columbia Broadcast¬
ing Network, Bernard M. Baruch, following the acceptance of the
-
as
.Zone
State_
7
I
THE COMMERCIAL & FINANCIAL' CHRONICLE
1786
Apparently, the banks had failed
to get assurances that the. group
Illinois Brevities
Truth in Politics Act Needed
a
would not violate anti-trust laWs;-
CHICAGO, ILL.—Home-mortgage levels have become the-sub¬
Arrangements for an offering of
ject of montroversy here, with some bankers and real estate men
declaring that loans made by savings and loan societies will exceed $20,000,000 in common stock, at
the value of the mortgaged property by 1948.
Savings and loan offi¬ $5 a share, have been completed by
cials reply that most criticisms arise from envy, but admit the loans the Tucker Corp. with Floyd D.
Cerf Co., Inc., it was disclosed.
are "much more generous" than formerly.
A
In
a
Proceeds
interview,^
pre-convention
urged to continue as a director and
Frank C. Rathje, former presi¬
a member of the executive com¬
dent of the American Bankers As¬
mittee.
'
V
entered the debate by
that Federal guarantees
should be restrained rather than
sociation,
'
$
*
*
of
better
be
would
nation
The
Rathje said. The
City
Bank & Trust Co. and of the Mu¬
tual National Bank of Chicago said
Chicago
the
of
President
-
"superstructure based on gov¬
guarantees and insur¬
a
ernment
will lead only to overexpan-
ance
sion and
'
$
4
i-
he
Corp. offered' to lease the
property for five
end to a 25-year-old
when it upheld the cement
here put an
Faulkner, Jr., gen¬
eral counsel of Armour & Co., who
J.
its struggle to quash
Federal Trade Commission's
In a rul¬
ing similar to the Supreme Court
guided the packing firm through decision of 1925, which was fol¬
the legal difficulties of the reor¬ lowed by renewed FTC suits 12
ganization following World War I years later, the court said the
<.and later recapitalizations and re¬ use of basing points "appears not
financings, will retire Nov. 2 after to have been the result of any col¬
,29 years in the post and 41 years lective activity."
with the company.
He is being
#
*
#
charges of price-fixing.
!
Member, National Association
of their 1929
peaks, contrary to any beliefs that
now
/
Dealers
Securities
Farnsworth, Chicago real¬
tor, said land values in the Loop
CARTER H. CORBREY & CO.
only 60%
are
commercial real estate is enjoying
Wholesale Distributors
an
'
•
U
Pacific Coast
—
district
ness
For
Speakers
as
j
crease
i
650 S. Spring St
-
State 6502
Michigan 4181
LA 255
<
CG 99
<
ject to the
as
of
recession,
'
5
of
purchase
Meat
■*
tax
shortages
tomobiles."
United
that
"credit
"
this
have
low
ruling
no
said
that
companies
might
into
a
change the retrenchment
depression, Many risks in
Stock
Exchange
established sales outlet
Chicago 4
I
CG 22
Wells-Gardner
&
a
resulted
was
the
off
taking the lim
politicians and
,
clause.
If
1.
had not.*
The
2.
>
of
income
of
sources
public servant would make
interesting reading as do those
every
as
3/ Is it any less a cfrime for a
Bureau or Commission to
of Peter
substance
the
to
buy the vote of Paul than it is for
Kruger to' convert the as¬
some
sets
of
a
publicly held corpora¬
pretend to seek price sta¬
while quietly encouraging
wage
increases is, to say the
least, not being frank.
5. Taxation
should be direct
on
a
in
learned.
A.
Mackey
on
was
Oct. 2, Chandler
named
as
nominee
serve until Jqh. 22, 1947.
Mr.
Mackey has previously filled the
4. To
bility
the
where
underprivileged
can
-
office of
president, serving from
1935. to 1941,
♦Remarks
Young
Mr.
by
at
"Financial World" Annual Awards
Banquet,* New York, Oct. 4, 1946.
Co., Com.
Cribben & Sexton
Inc., Com.
our
certainly
—
Underwriters—Dealers—Distributors
Utility
H.Davis &Uo.
i
Chicago Board of Trade
v-,••■■
Common sy; ■
accountings;
upon
the
for
Incorporated
135 So. La Salle Street, Chicago 3
Telephone
New York
State
8711
Teletype
Philadelphia
^
wastes
Washington,
It is time for all of
-
outsiders
us
—outside the
government, I mean
get off the defenses—to go I
the offensive and insist upon a
-to
on
healthier
a
balance
of regulation—
little less here and
a
little
more
there.
Roihchild & Go, Offers
Aviation Press Notes
L. H. Rothschild & Co.
interest.
1
The Aviation Press,
Inc., incor¬
porated in the State of New Jer¬
sey iir 1942, publishes and dis¬
tributes
newspapers,
periodicals
vides
magazines,;
books and pro¬
services covering avi¬
and
news
ation and
p Pittsburgh
~
Minneapolis
Tel. Dearborn 5000
The
activities.
related
and publishes
"Contact,"
Aviation's
National
Newspaper, and a juvenile edi^
tion, "Contact Comics."
corporation
to
owns
tion, at the option of the holder,
at the rate of $3 per share if converted on or before July 2, 1948,
$4 per share if converted between
July 2, 1948 and July 2, 1949, and
$5 per share if converted after
July 2, 1949.
from
the
the
sale of
liquidating
and
liabilities,
notes are to be used in
loans
to
1 Until the first
part of 1946
"Con-^
lim-*
ited,
of
because
a
Exchange
Chicago 4
newsprint
direct-by-mail
to
An intensive
sub¬
subscript
campaign is now underway
and it is
anticipated that the total
will
distribution
copies
per
reach.
50,000
issue within a year.
Tele. CG 146
I SINCE 19081
FOUNDED 1913
Fred. W. Fairman Co.
|
Central Public
Utility
our
analyzing
new
these
Analysis of
an
*
Copy
CHICAGO
SALLE
ST.
4, ILLINOIS
Telephone Randolph 4008
Direct Private
-
Bell
Wire
System
to New
CG
York
587
MIDWEST
SMMMMMMMSMMMMMBMBMnMBBi
•
•
„
M'-KINNON
SECURITIES
Stock
STRAUSS BROS.
request
on
THOMSON&
for the
Stock
Standard Silica Corp.
Vi'
i
.•
'V
CASWELL & CO.
120 South La Salle Street
'
FAROLL & COMPANY
Member
New
Phoae Central 5690
York
Stock
and other Principal
208
CHICAGO 3, ILL.
Tele. CG 1122
Request
MARKETS
Common
—
on
NEW YORK
Distilling Corp.
Common
Brochure
Bonds.
Analyses
Merchants
Insulation
.
208 SOUTH LA
Recent
Universal Zonolite
5^'s of '52
Write for
We have
So. La
Exchange,
Exchanges
Salle St.-
Members
Members
Phone Andover
1430
Tele.
CG 156
York Security Dealers
Illinois
Securities
Dealers
New
Ass'n
Ass'n
Board of Trade Bldg., Chicago 4
Telephone: Harrison 2075
Teletype CG 129
CHICAGO 4
Direct
Wire
to
New
::
The notes may be converted in¬
common stock of the corpora^
tion
209 S. La Salle Street •
273
Oct; 9
$60,000 of The Aviation;
Press, Inc. 10-year 6% convertiblesinking fund notes due July 2,
1955. The notes, issued in denomi-"
nations of $100, $500 and $1,000,
were priced at 98% plus accrued*
scribers.
William A.Fuller& Co.
Members of Chicago Stock
CG
on
offered
tacV subscription list 7 was
Inc., Conr.
::Ed. Schuster & Co.,
i
Byllesby and Company
Tel. Franklin 8622
our
provide additional work¬
ing capital.
*Pro8pectus Available
H. M.
and
be
Shortage,
16 So. La Salle St., Chicago 3
Teletype CG 405
Indianapolis, Ind.
Rockford, III.
Cleveland, Ohio
that
liberties
and confusions of
and
Common
Kansas Nebraska Natural Gas
1916
Members Principal Stock Exchanges
—
Municipal
BONDS and STOCKS
*Prospectus Available on Request.
TRADING MARKETS
Chase Candy
Railroad
Industrial
measuring
public serv- €
we
trust 7
our
us
explanations
short-term
-
Public
for
cannot
cities, to insist
and
Proceeds
Woodward Govenor Co., Com.
better business.
merely our money.
I Labor, farmer and .capital must s
take time out from form filling,
and the time consuming annoy¬
ances of Washington-created scar¬
my
tion to personal use?
to
pro¬
for installment fi¬
37 states,
Rations
wholesome
this
reversing
initial process, by
divert
meeting of the Nominating
F. H. Silence
nancing in
been
of officers and directors.
president to fill the unexpired
term caused by the resignation of
Snap-On Tools Corp., Com.
Established
At
of
dissolving the plan, it
*
these
Oct. 7 to consider the nomination
Plan, organized to
on the government; that
what the Constitution
is, a
fee and Sugar Exchange held
employ traveling sales¬
coverage
the peo¬
Committee of the New York Cof¬
will be subject to taxes on
vide
,
^ V
and
Pres. of Coffee & Sugar Ex.
Finance
209 S. La Salle Street
Ran. 8101
country,
now
disregarded, he said.
A Chicago meeting of the 13 sig¬
natory banks of the National Sales
i and other principal exchanges
;
cannot be
security prices
Mackey Nominated for f
John J. O'Brien & Co.
York
on
Public
which
men
■
restrictions—not
comprehensive plan for the regu¬
lation of government. But for 175
years now, the politicians have
:
sales in the state.
New
retail : sales
under
or
started by
regulations,
country was
limitations,
Truth in Securities Act, clause for
v
experts
,
con¬
-
.
Young
What we need today is a Truth
in7 Politics Act
to
match the
huge
the
rise,
the
of
ta businessmen to handle prod¬
Members
au¬
R.
Robert
it
ple, but
is
-•
lower;
than those they themselves have 7
laid down for the custodians of
to be ;
honest, might well insist 'that
Pennsylvania Avenue follow its
example.
Our
with
life,
having
that
im-
the Securities
as
us
standards
honesty of
who ask
them
Wall
annual reports and
proxies were filled with broken
Edward P. Rubin, president of promises
and half truths, the
Selected, American Shares,
ad¬ Truth in Securities Act would
have .got me if the Common Law
mitted
that
labor
difficulties
and
case
ants,
pays
should level off in 1947 at slightly
above this year's totals. ;
confront
the
the
Corp.,
Economics
despite
business
in
Act,
dif¬
Busi-
s,
certainly
as
The
from
found
Politics Act to
putting them on the people.
States
Owens-
The
request.
of houses and
"
A. G. Hahlberg, president of the
|
appeals handed down the
but which commission Minneso¬
on
recession
to work ami make up our accumu¬
corporations are sub¬
state income taxes
priced listed
Copied
the
predicted would be followed
by a period when "we really go
lated
n e s
and
*
Institute
just
Se¬
old
Street.
placing
he
same
ucts
,
in¬
versity of Illinois, told the Amer¬
said
stocks.
-
♦
*
censed sales.
-group
a
100%
a
in consumer credit in the;
which employed
traveling salesmen but had no li¬
suggesting
short"
and
£7 Prof. L. J. Norton, of the Uni¬
domestic firms. The state board
decision
N
nasty
*
Illinois Glass Co.,
£ We have prepared a card
conven-
major depression.
a
Tax economists have pondered
recent decision that
out-of-state
135LaSalleSL
various
| ability of the present "business
I retrenchment" developing into
Minnesota's
LOS ANGELES 14
ferent
| next few years, and the improb-
sumer
DISTRIBUTION
CHICAGO 3
102, he said,
St
*
MARKET
SECONDARY
at
"sharp,
a
business
compared with 163 in 1929.
UNDERWRITERS
;
is
now
quite
Truth in
Act has given
t
inflationary market. The price
index for real estate in the busi¬
Middle West
,
,,
tion here made such predictions
i
ican
Ward
years.
A
the
curities
is
,
pose penalties upon^such abuses
would give us better- government
Street,
in
r
only the rich bear
these price spiraling burdens is to
deceive them.
a s
the
industry in
>
was
Appeals
of
Court
Circuit
for
acting.:: Kaisergroup
look at it. To cause them
a
to believe that
en¬
Wall
Frazer
^''y-.:
'"■'/.''v
as
Truth
the
have
ing.
which
j- held by government agencies,
The
is
clined
disclose
'<£-
1
-
pol¬
under
to
M
is-interest¬
consulting engineer firm, who de¬
feet
of the 810,000 square
some
icy,
it
made by Philip D. Fitzgerald of a
the man¬
agement is awaiting release of
on
sound
a
couraging
now leased by Republic.
offer of $28,250,000 was
Another
disclosed. The Mart now
was
the
Charles
Chicago,
on abuses by government offi- 7
those imposed by our Securities' Acts.
"accountings" for Washington's wastes.,;,,
in reach¬
financial
$30,000,000 for the
steel mill in South
$92,000,000
consulates,
is fully occupied, but
case
speculation."
afs
it
i
him
■■
ing
government
■'
Railway Co..
as necessary as
assist
may
Dodge-Chicago plant.
*
Ohio
Secretary Snyder's statement that the stockholders in the gov¬
ernment, meaning all of us, should be better informed, so that they-
Republic Steel Corp. offered the
in
space
local
house
to
and
by, "building a normal
credit structure based on normal
served
credit risks," Mr.
requested
just
are
We should insist
v>t.-
**
&
Young declares that penalties
cials
of the new Tucker
"Torpedo" automobile in the for¬
Chi¬
cago's Merchandise Mart to dis¬
play products of their industries
i have
Mr.
production
mer
governments
foreign
Several
By ROBERT R. YOUNG*
Chairman, Chesapeake
used to finance
be
*
urging
expanded in the present period
high building costs.
:
will
Thursday, October 10, 1946
York Office
.
•
COMMODITIES
v
231 So. La Salle St.
Chicago 4
Branches In 35 Citle*
Members New York Stock Exchange
principal exchanges
:
,
7
and other"
Volume
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4532
164
1787
VO't
Gruen Watch
.
f*
.
_
'
•
'
<
• .1
r*
v
...
;
tr
*
.
.
t
:
dum V—-
;(
..
Dealer-Broker
Co.
Memoran¬
—
Fred B. Prophet Company—De¬
Buckley
Brothers, 1420 tailed
Walnut Street, Philadelphia 2, Pa* Larson
- -
Also
-•
on
Recommendations and Literature
available
memoranda
are
&
National
South Carolina Electric & Gas
.
Co. and Standard Stoker Co.
memorandum—De-
Tornga,* Grand Rapids
Building, Grand
Bank
Rapids 2, Mich..
National
(
^Adams Journal — Monthly, bul-1
Xjetin of news and comment on the
market —: Adams & Co., 231 South
*
American
Broad¬
—
'
the''family-owned
or
cular—Seligman, Lubetkin & Co.,
Inc., 41 Broad Street, New York 4,
The
on
Also available
circulars
are
Products and Wellman
Tennessee
Shares
X cession Hedge
Reout¬
a
as
Report on
—
look for gold
mining companies —
& Delafield,
14 Wall
Delaf ield
ford
on
Analyzer
Stock
memoranda
are
—
Iron & Steel; Barcalo; Haloid;
American' Window
Glass;
.
"
Depression Necessary?
a
Market Study
Also
—
available
J. F. Reilly & Dwight
—
Co.; Inc., 40 Exchange Place; New
studies
are
Manufacturing
—
350
the follow¬
are
Central
ing: The Price Bubble; When Will
of
World War II End?;
and
Long Term
Forecast; Have Listed Companies
Superior Management?; Election
s Day;
Executives Tell Us That;
Essentials; The Commercia 1
i Shearing and Stamping Co.; Buda
Company; Barcalo Manufacturing
Co.; Doing the Impossible; Com«mon
Sense; John Doe Letter;
Losses in a Bull Market; .Aeronca
Aircraft; American Phenolic
Corp.;
Drieo- Industrial
Corp.;
f
'52
Public
Queen Anne Candy
MacFadden
and
Gas
Consolidated
Adds Fisher fo Staff
Samuel
Publications
Corporation
Avenue, New York
York
was
—
Minnesota
Mining and Manu¬
— Analysis of
earn¬
ings record, financial position and
growth potentialities — Kidder,
Peabody & Co., 17 Wall Street,
ities Corp. and Lehman Brothers.
1
—
ton
Hilton Hotels
'
Carolina Electric
Memorandum
&
&
KITCHEN & CO.
Gas
G. A, Sax-
—
135 South La Salle Street
Co., TnCi, 70 Pine Street,
Chicago 3, III.
Tel.
STAte 4950
with reference to possibilities for
appreciation and increased income
Active
return—Boenning
&
Co.,
1606
Walnut
Street,
Philadelphia
3,
Southern
report
Peltason,
—»
,
Tenenbapm
Co., Landreth Building, St. Louis
2, Mo.
M.
Memo¬
—
—
Study
H.
Natural
Gas
Burnham
—
and
Co,
Co.,
*
Corpora I Ion
Bylleshy
j Universal Zonolite Insulation
Analysis
Columbia Gas & Electric Corp.
Plomij^ Tool/Co. —* Special re¬
Golden —Analysis — L. F. Rothschild &
port —- Maxwell, Marshall & Co.,
Crown Mining Co* Silver Creek Co., 120 Broadway, New York 5,
647
South
Spring ' street, Los
Precision Corp.; Stromberg Carl¬ N. Y.
Angeleg 14,, Calif,
son Preferred; U. S. Sugar; Pte?Decker Manufacturing Co.—De¬
tics Materials Corp. ~
tailed Analysis—Comstock &
Co,,
MIDLAND
Low Priced Stocks—- A card 231 South La Salle Street, Chi¬
j,
suggesting a group purchase of cago 4, 111. •
South
General Machinery Corp.;
3,-Ill.j-.
Also
.
•
Common Stock
Caswell &; Co., < 120
Salle Street^. Chicago
La
'•
"
available
i Circular
;
is
circular
a
five
low
stocks
priced listed
-
T
La Salle Street, Chicago 4, 111.
—
Vrt.:;■
Also available
—
analyses of
are
ADAMS &
231
SHORE
& SOUTH
SOUTH
X
BEND
LA
Coi
^
SALLE STREET
CHICAGO 4, ILLINOIS
,
TELETYPE CG 361
Miller Manufacturing Co.
-
UTILITIES
:
CHICAGO SOUTH
|
Request * J;
☆
MIDLAND REALIZATION
Hydraulic
Press
Manufacturing
Co.; Long Bell Lumber Co., and
on
on
Chicago Hardware Foundry Co.
,
John J. O'Brien & Co., 209 South
/
15
Broad Street, New York 5, N. Y
& Co., Stock Ex¬
change Building, Philadelphia, Pa,
Trading Market in
National: -1
Terminals
Pa.
;
status
Tele. CG. 28
Southern Advance Bag & Paper
Co.—Report
on
common
stock
Electric
present
i*
Common
—
New York 5, N. Y.
Street, Chicago 4, 111.
on
t
report—Mercier, McDowell
Building, De¬
South
Co.
5, N. Y.
Pittsburgh Railways
Exchange. Mr. Fishjer
formerly with Mellon Secur¬
& Dolphyn, Buhl
troit 26;Mich.
■
Salle
randum
I.
City, members of the New
*
facturing Co.
Analytical
be¬
...
Sheller Manufacturing Corp.
Recent
—
—
has
■
.
La Salle Street.
Cir¬
Comprehensive
New
England Public
Service
study and analysis in brochure
Co.
Appraisal of values — Ira
form—Fred W.#Fairman & Co.,
Haupt & Co., Ill Broadway, New
208 South La Salle Street, Chi¬
York 6, N, Y.
cago 4, 111.
Master
Fisher
with. Francis
Co., 1 Wall Street, New
York Stock
Co., 120
Pfd.
Chefford
Curtis
associated
Serrick
Corp. — Analysis —
Sills, Minton & Co., Inc., 209 South
Broadway, New York 5, N. Y.
York
•
preliminary
TRADING MARKET
Co.
cular—C. E; de Willers &
New
a
White Motor Co.
on
on
5^9
Utility
Fifth
is
Francis I. du Ponl Co.
4,
haviChronicle-
n.Y.
circular
a
Co..
running in: the
write to Mark Merit, in care o'
Schenley Distillers Corporation
interesting situ¬
Brailsford
&
Co., 208
La
Salle
Street, Chicago
is
Co.—
&
York
articles they
been
—
only—Adams & Co., 231 South La
available
Also
Co,
on
available
New
Schenley Distillers
National Terminals Corporation
—Late memorandum for dealers
York 5, N. Y.
-
Products
report
come
of
Hoff¬
Goodwin, 265 Montgomery
du Pont &
of
Purolator Products.
Manufacturing
Street.
&
and
Co.
Broad
N.Y.
Puro-
Iator
Is
Steel
Memorandum
Empire; Lanova Corp.; Mo¬
Products; Upson Corp.; Ala*
Operating results of the first half
;
of 1946 for a representative group bama Mills.
of fire
and casualty insurance
Boston WTiarf—Descriptive an¬
companies — Geyer & Co., Inc.,
67 Wall Street, New York 5, N. Y. alysis—du Pont, Homsey Co., 31
Milk Street, Boston 9, Mass.
X.vX;'.XX.;'X
VXXXX'
'
Rockwell
W. L. Douglas Shoe Co.; Hart¬
hawk Rubber; and Taylor Whart¬
Street', New York 5, N, Y.
Insurance
available
Also
77
—Brochure
Indiana
Trust
&
Analysis—Steiner, Rouse
Co.,
Street, New York 5, N. Y.
64 Wall
Also
New York 5, N. Y.
on
Johnson
&
man
Special
—
Walston,
—
Unterberg
•
Co., 61 Broadway, New York 6,
The-
and
on
.
Mining
Corp.
^XXXXXX'X XX/;X:X:''
Analysis—R. H.
r\V
' V,
corporation — The Engineering.
ation
Broadway,
South
Aspinook Corporation—Circular
New York 5, N. Y.
4, 111.
—Ward
&
Co., 120 Broadway,
-Gold
XX
,
Gulf, Mobile & Ohio Railroad-
First Boston Corp., 100
a
111.
E.
memoranda
are
Chicago
N. Y.
closely-held
-
available
Muter-Co.
$
Argo Oil Corp.—Descriptive cir¬
-
for
X
Street. Chicago 4,
;Also
&
25
XX Family-Owned Corporation and
Taxation
Booklet explaining
facilities for financing to provide
for inheritance, gift and similar
taxes
Barken,- 32
New York 4, N. Y,
way,
#La Salle Street, Chicago 4, 111.
-
N. Y.
Insulator—Memoran¬
dum—Peter
Bank
Co.—Analysis—C.
Salle
f
•
Corp.
Also available
Greyhound Corporation—Circu¬
lar—Hicks &> Price, 231 South La
"•
■'
Towmotor
memorandum
Street, San Francisco 4, Calif.
.
i
Public
It is understood that the firms mentioned will be pleased
to send interested parties the following literature: .XX
Young.
-
i;
PHONE STATE 0101
NORTHERN INDIANA PUBLIC SERVICE COMMON
York City Banks—Com¬
C. H. Dutton Company—Analy*
parison and analysis of 19 New
York City banks for the third sis for dealers only on 66-year old
quarter of 1946—Laird, Bissell & company with interesting pros¬
Meeds, 120 Broadway, New York pects—Moreland & Co., Penobscot
Building, Detroit 26, Mich.
5, N. Y.
;X
K ,New
•.'•Xv V
Petroleum Industry
—
cf condition and outlook
&
Hirsch
Co., 25 Broad Street, New York
4, N. Y.
Also available is
Gas
&
INCORPORATED
THE SECURITIES
I
*
OF
Koehring Co.: I
National Tool Co.,
Northern Paper Mills Co.
Hamilton Mfg. Co.
Lake Superior District Power Co.
-
James
-
comment
a
various
on
situations.
bulletin
Oroyille Dredging
request.
Chicago Stock Exchange
225 EAST MASON ST.
PHONES—Daly 5392
{
Chicago: State 0933
'
" '
v
1
.
,
.
CHICAGO
X
U
MILWAUKEE (2)
M
231
So. La Salle St.
4l|X'-;X ;
Dearborn
1501
Teletype CG 955
Teletype MI 488
,
Rhodesia Broken Hills
.
,
'
Comstock & Co.
Memoers
Rhodesian Anglo American
interesting
Trailmebile Company
'Detailed analysis available on
Minn, & Ontario Paper, Com.
of
,
Manufacturing Co.
—
Letter,
.
Seven-Up Texas Corp.
Nekoosa Edwards Paper Co.
Compo Shoe Mach. Co.
Gaumont British Pictures
Asphalt Co.
St. Louis Public Service Co.
Cons. Water Pwr. and Paper Co.
Fresnillo Co.
Corporation
Miller Manufacturing Co.
Weyenherg Shoe Mfg. Co.
Wisconsin Pr. & Lt. Co.
Wisconsin Elec. Pr. Co.
Also available is the Fortnightly
Coal
Mastic
Cinemg Television
—
Ben
Long-Bell Lumber Company
CONTINUOUS INTEREST IN:
I
BrownCo.Com. & Pfd.
Analytical mem¬
orandum
H. Hentz & Co., 60
Beaver Street, New York 4, N. Y.
Investment
Hydraulic Press Mfg. Co.
Old
*
IX
Abitibi P. & P. Co. Com. & Pfd.
—
Ahlens, Inc.
Teletype: CG 1200
f-
Trading Market«
Manufacturing Co.
;
.
Howard Industries, Inc.
*
Telephonet Dearborn 6161
.
Opportunities — Sug¬
gested rail switches suggested by
official estimates of 1946 earnings
Vilas & Hickey, 49 Wall Street,
New York 5, N. Y.
Decker
4",
CHICAGO 3. ILLINOIS
Coi,
Inc., 37 Wall Street, New York 5,
N.Y.
ternational Telephone
graph Corp,
Trading
7 Aeronca Aircraft
Corp.
*
135 SOUTH LA SALLE STREET
■
Corp.-*
Memorandum—J. G. White &
study of In¬
&
Tele-
a
Water
J'
"y.
X
1
Federal
Review
—
XX-,
DOYLE, O'CONNOR & CO,
Rhodesian Selection Trnst
1
San Francisco Mines
Central Public
Scophony, Ltd.
Utility Corp. Inc.
■■l
Recent
Out
Values
S
on
^Jessop
*
'
^
if.
.
7/:
'
;
•
:
.•
ZIPPIN & COMPANY
-
Xj'XX C. G. Conn
Preferred
on
-
-
-
'
Incorporated
-
«
208
S. La Salle Street
208
CHICAGO 4
Tel.
•'
<
State
•
L
9868
ri>'»Lv '?'■*!
'■■'t.'i.i.a
95
135
Foreig/t Securities
South La
Randolph 4696
CG 451
Salle
Street
CO
530
.l:
'
'
Direct wires to our
.
Central 7540.
offices in
principal financial centers
Members
New
York Stock Exchange
Members Chicago Stock Exchange
t
-
X\
X
;4-:
--XxX'vV
All Wisconsin Issues
■
!>
Associate Member New York Curb
Member—Chicago Stock Exchange
105
So. La
Salle
St., Chicago 3, 111.
CG 262
Central
Offices
Eau Claire
135 Sooth La Salle St., Chicago 3, IU.
ANDover 5700
Tele CG 650-651
-
*
♦
*
*
■»
■*
«
0780
Wisconsin
In
Fond du Lac
Madison
Tel
t
■■
\
0LLEY, DAYTON & GERNON
straus & blosser
CHICAGO 3
S. La Salle Street
Chicago 4, Illinois
CG
•>
in
X1
Hearst Class A
Request
E. H. Rollins & Sons
r
I
Consol. Dearborn Com.
,7
*
Specialists
;X;X
X'-X
•
Gisholt Machine
Steel
&
^Prospectus
r
Macfadden Publications
Pickering Lumber Com.
,
Common
-
Greiss Fleger Com.
•i VX.
-
Seismograph Service Corp.
Vicana Sugar Co., Common
•
x
Corrugated
Paper Com.
: r
Common
Request
Brailsford & Co.
Wayne
•
-
Vicana Sugar Co. 6/55
Projections of Work
Available
Ft.
Steep Rock Iron Mines
>-i»XX'4$$
Revised
*
x
5^s, 1952
t.v£>v•
X
Bought—Sold—Quoted ?'/,
;
■;
(Mexico)
-
-
La Crosse
Wausau
,
i&irrtnrf;,
1788
THE COMMERCIAL &
FINANCIAL CHRONICLE
Chase Bank Honors
Hi
iw»,
Reviews
i,
^
oyees
National Bank who have served for
:--ii
Chanin Building
25
v^--^
years
the
The €hanin Building First Mortgage 5 ^ Leasehold Bonds, newly
-but of a reorganization consummated earlier in the year, are attrac-
longer
ballroom
or
grand
was
of
held in
the Wal¬
dorf Astoria
Hotel, Oct. 9. Hosts
speakers at the affair were
Winthrop W. Aldrich, Chairman;
and1
Donald Campbell, Vice-ChaiiU
man,
and
Arthur \: W. * McCain,
H.
gation of the Lexington Avenue
present
owner
"W"" the
office
and
building-and are se¬
cured by a first mortgage on the
leasehold estate occupying the en¬
tire
block front
Of
Lexington
on
.
the west side
Avenue,
between
41st and 42nd Streets immediately
td the south of
Grand Central
Station
the
and
building erected
the
as
;
56-story
is leased
ground
office
thereon, known
Chanin
and
Building.
The
from' the 'Man¬
Storage and Warehouse
Co. for 21 years to July 1, .1948 at
rental
with
an
first
ithe
of $383,750 per annum,
option of four renewals,
two
interest
at
on
5%
of
Corporation, the
the
ap-
President of the bank;" "
value of the
land
but
not
addressing the group, Mr.
McCain, .s^id that thq, Chase had
found the five-day week satisfac¬
than
two
at
value
$300,t)00,; and
5V2%
of
the
land,
of
the
the' last
appraised
but
less
not
than the amount paid in the last
of the prior renewal period.
year
The plan of reorganization pro¬
vided for. the best
possible treat¬
ment of the first mortgage
income
being distributed
bonds,
fol¬
as
lows:
From
the
net
income
of
the
property there is first set aside
$240,000 in each six-month period
($480,000 for the year) for the
payment of 5% fixed interest per
the
balance
said
All
remaining net income, after
for a contingency re¬
serve
fund (until $150,000 is so
accumlated at the rate of $25,000
provision
annum) and payment of sec¬
and third mortgage bond in¬
terest, is likewise applied toward
per
ond
the
retirement
first mortgage
of
bonds*
SECURITIES
sulted
effect
in
the
for
come
this
of
plan
distribution
the
fiscal
re¬
of
in¬
ended
year
July 31,* 1946 as shown in the
bbmpanying table.-'
ac•
BOUGHT
three
nearly
SOLD
available for
bonds
times
income
and
sinking fund
these
on
equivalent to approxi¬
mately 7 % of the issue.
QUOTED
was
Philadelphia Exch.
Members Make Reports
SHASKAN & CO.
Members New York Slock
Members New York Curb
40 EXCHANGE PL., N .Y.
Bell
V
PHILADELPHIA,
ber
Exchange
Exchange
firms
,
Stock
of
the
Exchange
reports of
Teletype NY 1-953
their
tion
Dlgby 4-4950
the
of
as
Sept.
13
an
PA.
Mem¬
—
submitted
close
of
accordance
condi¬
business
with
the
request of the Securities and Ex¬
change
Commission,
it
was
an¬
nounced,
Frank
Firm
Trading Markets:
E.
Baker, Baker, Weeks
&
Harden, President of the Ex¬
change, following the semi-month¬
California & New York
ly meeting of the Board of Gov¬
ernors
have
Real Estate Issues
stated:
been
"These statements
examined
by
the
ex¬
change and all have met the
nancial
requirements of its
mittee
that
date."
fi¬
com¬
business conduct
on
summer
creased
provided
the
necessary
permissive
legislation
is passed at the next session of
the
New
York
State
Legislature.
Under the existing statutes, banks
are permitted to close on Satur¬
days only during the summer
months of June, July, August and
September.
Mr. McCain also announced that
155
Montgomery St., San Francisco
Tela. BP 61 & 62
4
EXbrook 8515
of
as
V-;
Cortesi
in
Real Estate Securities
lengthened from
weeks#
Men
two
and
to
women
*52——New
of
Redpath,
Ripley & Co.
man
York
&
make
Lott Hotels, Inc.—Chicago
a
Stock
of Oct. 17.
Wacker Wells Bldg.
Harri¬
Co., Inc. Mr. Cortesi will
his
headquarters
at
the
firm's New
York
Street..-
&
Non
CG-81
Central 4402
t
agricultural
-
increased
New
announce
York
that
their Newark
•*, -v
office, 24 Commerce
«"
of
230,000
brought
since
December,
1945,
and
700,-
000 below the peak of 2.7 million
reached in March, 1946. This de¬
cline, in the face of the virtual
completion of the demobilization
of
the
armed
services,
indicates
employment
have
been
with
them
engraved
which
were
the
bank
from
the
staff
were
bank.
silver
gold
•<.
watches
gifts
Members
of
or
their preferences for
wrist watches, sterling
-
About
90
new
mem¬
bers became eligible to join the
25-year service group during 1946.
CLEVELAND, OHIO—The Na¬
City Bank of Cleveland
announces
the
appointment
of
tional
Joseph A. Overton as manager of
the Municipal Bond Department.
Mr. Overton in the past was with
Edward Lowber Stokes, Pask &
Walbridge, and Jenks, Gwynee &
Co. in New York City.
BEACH, FLA.—Edward
of the New
Exchange, has formed
Swenson & Co., with
offices at 271 South County Road,
partnership
with
Lester
A.
Corya. Mr. Swenson was formerly
in
individual broker, with
New
Beach.
York
Mr.
City
and
offices
Palm
Corya was associated
with him.
Officers
Formed
the securities business.
are
and
D. L. Mills,
president;
Bryce Morris, vice-president; and
already been extended
a
for tomorrow when the
Exchange will reply to the union, stating
ability or inability to meet the. specific points raised, UFE
has applied to the State Labor Board for an election to determine^
collective bargaining agent for the employees of A. M. Kidder & Co.
I
its
;
The United Financial Employees is
seeking a nevv contract with
the New York Stock Exchange to replace the one which was
to
expire next Tuesday but which<^
State
already
been
extended
a
has
month to
give the negotiators for
sides the chance
to
come
to
friendly settlement of terms that
will be
satisfactory to both parties.
^,ue
Labor
Board
itself
for
a
decision, briefs must be filed by
the opposing parties.
Both the union and Harris, Up¬
ham & Co. attorneys have until
Under the terms of the present
ten days after completion of the
contract, if the union and the Ex¬ stenographic report of the hear¬
change can not agree on a new ings to file their briefs.
contract by Oct. 15, the present
contract is automatically extended
month
a
condition
on
that
any
agreement/reached will be retro¬
active to Oct.
With Dean Witter & Co.
(Special
SAN-
15.
to
The Financial
FRANCISCO,
Chronicli)
CALIF.—
D. Forrest Greene and George W.
Three meetings of the negotiat¬
ors have been held at which the
Miller, Jr. have become affiliated
union's
with Dean Witter & Co., 45 Mont¬
complete
for
demands
case,
increase
25%
a
including
in
seven-hour day, has
been presented to the Exchange.
Another meeting is scheduled for
tomorrow when the Exchange, in
wages and
a
turn, will reply to the union, stat¬
ing its ability or inability to meet
the specific points raised.
Undaunted by its failure to win
collective bargaining
rights for
gomery Street, members of the
New
York
and
San
Francisco
Stock
Exchanges.
Walter Pryor, Warden
\\
Stillwell Are With
v
McDonald & Co.
(Special to
The
Financial
Chronicle)
" 1
CLEVELAND, OHIO—Walter J.
of three Wall Street Pryor, Jr. and Warden G. Stillwell
firms—Harris, Upham&Co., Carl have become associated with Mc¬
the employees
M.
Loeb, Rhoades & Co., and Em¬ Donald &
pire Trust Co.—the union now has
applied to the State Labor Board
for
an
election
A.
at
M.
reported that this case is still in
the informal hearing stage.
Hearings
were
Trial Examiner
also
John
closed
by
McCann
of
Board yesterday
in the union's move to have the
the
Labor
State
of
grounds
the
&
of
Co.
election
set
alleged
at
aside
Union Commerce
Co.,
Building.
Kidder
& Co. The State Labor Board has
":T-><'
engage in
industry
month. Three meetings of
the negotiators have already been held and another is scheduled
a
Joseph Overton Heads
Municipal Bond Dept.
Of Mat'l City of Cieve.
an
by
now
amounts
to
than 4 million since January
but which has
both
in
the
Tuesday.
the women members, Miss Isabel
McCosker, Manager of the Chase
Safp Deposit Company branch at
115 Broadway, is first in length
F.
exhausted
the
by
The United Financial Employees is seeking a new contract with the
NYSE to replace the one which was due to expire next
>
longest
service- record
among present staff members is
held by August H. Tiemeyer, As¬
sistant Manager of the Produce
Exchange Branch, 25 Broadway,
with 51 years in the bank., Among
service.
released
have been virtu¬
Exchange for
25% Increase in Wages and Seven-Hour Day
The
of
war
which
Wall Street Union Asks Slock
flatware,silver trays, or
and "pencil, sets. Watches
by far the most popular
4
of the
in
>
*
-'
manner
resources
trade.
Increased productivity of
currently employed labor is need¬
and more
thar£ 6 million since ed now to bring about higher lev¬
September 1945. Most of the in¬ els of production and thus combat
crease has been made
up of re- inflation.
more
pen
were
rapid
the
invited during the year
express
pocket
gold
in
on
the
commemorative
,
Alfred J. Florio is now associated
with them as a representative in
Street^
to
zation
ten years or longer,
" *
A large number of the 25-year
veterans at the dinner had with
The
Upham
the
August
months
two
increase
any
offices at 120 West 13th Avenue to
of
Exchange,,
in
ally
Chase
results
members
employment
A decline
-
unemployment in August down to
about 2 million, the lowest
figure
non-agricultural
the
Company' has been formed "with
Stock
re¬
end
of
DENVER, COLO.—The Millaw
rey,
640.000
Unemployment Drops to 2 Million
*
Small
in non-agricultural
em¬
ployment in July makes the total
Florio with Cohu & Torrey
Co.
Mr.
ported:
NEWARK, N; J.—Cohu & Tor¬
135 So. La Salle St.
CHICAGO '
Regarding employ¬
conditions
record.
15%
Millaw Company
St. Louis
Valiquet
slightly to 58.0 million
from 58.1 million in
July.
,„; • t-
Small
for
than
office, 52 Wall
,\y-
Roosevelt Hotel, Common
Myles Standish Co. Boston
D.
personnel. - Almost
half of the people in the organi¬
entire
Edward
Auchincloss,
Brown
and
inflation.
ment
clined
J.
com¬
labor
more
York Stock
become
York
as
bat
tivities with the result that total
employment for the month de¬
increase for the two months more
than 2,000,000, the largest increase
F. Swenson, member
In the past he was with Harriman
Prince & Lafayette Streets
5s
New
firm
Exchange
Parker &
will
the
in
million
be
PALM
Auchincloss Partner
Roger
of 810,000
agricultural
employment
in
August offset the increased em¬
ployment in' non^igricultural ac¬
pro¬
ivity of
currently em¬
ployed lab o r
to bring about
higher
levels
of
production
and thus
-
The seasonal decline
establish another all-time peak of
48.8 million.
This increase, com¬
ing on top of an increase of 1.4
•
Roger Gorlesi to Be
partner
is need for in¬
Vacation
annual
Form Swenson & Co.:
J. S. Strauss & Co.
activities has
duct
basis,
Philadelphia
have
financial
employed has
during the two
July is the second month
months.
,0 0 0:.the
year-round
choice.
From* the above, it may be seen
that interest requirements of the
first mortgage bonds were earned
women
increased.
to
The
of
increased 600,000
ber, 1945, there
during the
with 25 years or more of service
$240,000 toward bond retirement.
REAL ESTATE
number
will
of
.
u:
un¬
j
months
tory
comprise
and
though unem
ployment has
dropped to 2,0 0 0
'' '
,;
employment has declined and the
three weeks, and that the vacation
for those with 10 years of service
$802,605.29
-,
turning veterans. In addition
that al
this year and stated that the Chase
three
annum
<♦>
..,,-
situation,
notes
management is favorably disposed
toward the five-day week on a
period for
employees in the 25-year group
will
be | four
weeks instead of
—
—v-
the month of August, John D.
Administrator, in commenting on the
Production
in succession since W-J
Day in
which the employment of women
in non-agricultural
the
$302,975.00
First mortgage primary smking fund,——
177,025.00
New reserve fund
'
25,000.00
Second mortgage bond interest—59,250.00
Third mortgage bond interest—
/ 25,000.00
Balance to first mortgage sinking fund
213.355.29
J? y.s ™nthly reP°.rt covering
o
Small, Civilian
employment
lowest point
since Decem¬
s
less
first mortgage bonds—'
Total
"v
In
raised
hattan
a
Street
42nd
leasehold*"
Administrator
John D. Small
reports business ;
employment rise in August was offset by seasonal decline
of
810,000 in agricultural workers.: Calls for
greater productivity of,
currently employed to combat inflation.
otl' the staff of the Chase
sons now
Employment for August
Civilian Production
'in" Honor "of 993 per¬
dinnef
wl^kiuvi&n
Thursday, October 10, 1946
Henn With Paine, Webber
(Special
to
The
Financial
Chronicle)
CLEVELAND,
OHIO—Richard
L. Henn has rejoined the staff of
Paine,-Webber, Jackson & Curtis,
Union
Commerce
Buliding, after
serving in the armed forces.
.1
Harris,
on
the
unfair labor
Robt. Wagner in Houston
HOUSTON,
TEXAS—R
o
b er t
by thatv! firm. Hearings Wagner is engaging in the securi¬
this case opened last Thursday. ties business from offices at 1714
practices
in
Ben-ArLaw,-secretary-treasurer. Before this
case
goes
before the
Bolsover Road.
..
;
Volume
164
Number 4532
THE COMMERCIAL & FINANCIAL CHRONICLE
1789
shares of
Morgan Stanley Gronir Quickly Sells
The
■v
//v/ prices
not be due
may
to forced
^ liquidation of margined accounts,
as in past
years, credit operations
are still a factor in
security
spec¬
ulation.
Sdys the articl^t
,
} In
any survey of; general con^
ditions
prompted by the stock
market decline, one question is
;
the
extent to which people have
got themselves sewed up in debt.
.
i
Among loans
on
$75,000,000 Pacific Tel I Tel Debentures
.
securities
the. sale of the de¬
bentures will be used to reimburse
are
those to carry new issues in proc¬
ess
of distribution.
While there
was
a
owned
substantial volume of
at
are
redeemable
parent company. V
any
been
so
for
& Co., 120 Broad¬
New York City, has admit¬
Joseph. J. Reichwein to part¬
nership in the firm.
Mr. Reich¬
wein
has
some
time
been
with hte firm for
cashier.
as
;
a
period of active speculation.
It has been a good many years,
in fact, since the stock market has
been
seriously
vulnerable
to
forced selling precipitated by de¬
clines in stock prices themselves
and
on
calling of loans. Cash trading
the stock exchange was a
com¬
practice for many investors
even prior to the war. For trad^
ing after Jan. 21, 1946, the Board
mon
of
Governors of the Federal Re¬
serve
System, under the Securi¬
Exchange Act of 1934,. set
margin requirements for listed
ties
stocks at 100%.
July of last
The Board had in
the
raised
year
re¬
quirement from 50 to 75%.
The
100% margin requirement
designed to curb the prac¬
was
tice
of
buying stocks with bor¬
money by forcing buyers,
especially of shares listed on se-.
curities
exchanges, to pay for
rowed
them
in
full.
Much
has
been
written and said to the effect that
iiiiflHii
100% margins create thin markets
securities, and it is obvious
for
that they limit the buying power
that investors and speculators
can
put into the market when prices,
after declines, look cheat). On the
other hand, the rule of cash on
the
off
barrelhead
undoubtedly shut
credit buying on the rise
in the year and thereby
some
earlier
helped to avoid forced liquidation
later.
■
The
100%
has by
ever,
Treasure from the? Evemliades
■.
s
"
margin
how¬
rule,
-1,
no means eliminated
;
borrowing
a gainst
securities.
Bank loans for business as well as
for miscellaneous purposes often
have the added protection of se
curity collateral. Moreover, these
are specific exemptions from the
margin rule; notably, banks may
lend on bond collateral without
restriction.
•While it is not possible to de¬
termine
precisely the amount of
credit involved in
borrowings os¬
tensibly for other purposes, but
actually for the purpose of pur¬
chasing or carrying listed stocks,
such amount .can
enough to
general
alter
picture
reported loans
hardly be large
significantly the
as
on
shown
in
the
Ichemists of old sought
Al
tained
into
gold.
Today, the United
States
agronomy*.;
chemistry
and
engineering,
Governments
,
/J
Last
shown
the
carrying"
or
on
in
the
sugar,
nation's
food,
beverages and
clothing-
coupons
even
larger.
at
school
of
geographies, but soil made throughout the
waters, from
the
highlands.Eleven
Clewiston,
is
world's largest
the
oil,
lemongrass
paints;
the continuous growth and decay of
used
in
producer
perfumes,
soap
of
and
extensive grower of ramie, the wonder
an
textile fibre; and has large numbers of beef cattle
lush vegetation and by silt carried down by flood
which
plantation
other
villages house thousands of field workers/ Nine
are
finished
by-products
for
market
on
molasses
and
produced not by black magic
but through the intelligent cooperation of science,
hundred miles of farm roads and canals are main¬
Another
industries,
capital and labor.:
f
obliga¬
KNOX V I LLE
tions;
only
a
under
one
or
little
industrial
is
ready
the
series
to
do
its
-
by
Equitable
Securities
Equitable
has
part
supplying
in
helped
Corporation
ta finance
others
with
many
featuring
Southern
capital
funds.
E QUI TAB LE
BIRMINGHAM
NEW ORLEANS
only stocks but also corporate and
YQ R K
new
ME
H A
I
S
F O R
b
MP
R
T
H
GREENSBORO
Securities Corporation
municipal bonds."/
CHATTANOOGA
BROWNLEE O. CURREY. president
Loans for purchasing or
carry¬
ing
-stock
in
"old
accounts
.
.
margin
in
development.
NASHVILLE
to carry U. S. Government
billion, is for carrying
securities,
including
not
advertisement
Southern
DALLAS
month, This year's estimated crop is
a
sweet potato starch; the only continental producer
a
on
to cash the nation's civilian ration
for
land—not the swampy morass usually depicted "in
the present total consists of loans
(stocks held
a
securities
drive, and have since been declin¬
ing. No less than two-thirds of
•>.
than
U. S. Sugar, whose headquarters and factories are
reporting
member
leading cities.
These
one-third,
harvested -more
U. S. Sugar owns 150,000 acres of rich Everglades
peak of nearly $6
billion in December,
1945, follow¬
ing the close of the Victory Loan
other
Sugar
S.
starch, ramie fibre, essential oil, and beef.
the latest statement of
loans reached
loco¬
sugar
weekly
banks
TJ.
year
soil of the Florida Everglades into products more
valuable than precious- metal—basic raw materials
for
its
owns
twelve
with
million gross tons of sugar cane and made enough
lion loans "for the purpose of
pur¬
chasing
Corporation
it operates the largest raw-sugar house in America.
is;
transmuting the air, water, sunshine and organic
exemptions to¬
gether with undisturbed old mar
gin accounts, explain the $2.9 bil¬
the property/ The
motives and 600 standard freight cars. At Clewiston
Sugar
Corporation, through scientific application of mod-:
ern
on
farm-to-factory railroad,
own
securities.
Security Loans Chiefly Against
authorized
magic formula by
which they could transmute the base metals
centuries by
The
a
A 1
prior to.
322 UNION
STREET, NASHVILLE 3/TENN.-
,
J. W. Gould
a
low
V" :
ted
large exthat secured
and
cash
have
•
way,
market has
by
;
'
Admits Reichwein
•
loans
-
J. w. Gould
time: at prices ranging
from 106.25%, if redeemed on or
before Sept. 30, 1951, to par if re¬
in; part the ^company's: treasury
for: uncapitalized
expenditures
new
debentures
.
a
financed to such
stock, $100 par
...Together With its
made for extensions, additions and deemed on or after Oct. 1, 1981.
highly use¬ underwriting in process at the
improvements to its plant and
Giving effect to the financing
ful facility when properly
time of the stock market decline,
em¬
those of its subsidiaries; This hav¬ the company will have outstand¬
ployed, too much credit (debt) the appearance of market indiges¬
ing been done, the company will ing, in addition to the debentures
can be a serious
weakness, greatly tion
during
the
summer * had
offered, $75,000,000 2% debentures,
intensifying and prolonging peri¬ slowed the rate of new security repay advances from American
due Dec. 1, 1985, 820,000 shares of
ods of liquidation. One of the fav¬
offerings, and underwriting mar- Telephone and Telegraph Com¬ 6%
cumulative; preferred stock,
orable features of. the present sitr (Continued' on page 1834)
pany.
Any balance will be used $100 par value,
and f, 2,461,250
tion is that the bull
For, while credit is
common
-1
two whollysubsidiaries, Southern Cal¬
An underwriting group headed by Morgan Stanley & Co: for¬ ifornia Telephone Co. and Bell
Telephone Company of Nevada,
mally offered to the public Oct. 9 $75,000,000 principal amount of The
the company furnishes communi¬
Pacific Telephone & Telegraph Co. 40-year 2%% debentures, due
cation services, chiefly telephone
Oct. 1, 1986. f The debentures were priced at* 103.25 and accrued in¬
in these accounts, and for the ac¬
service, in 620 exchange areas in
terest, to yield 2.74% to maturity.
The securities were awarded to
counts that have not been dis¬
California, Nevada, Oregon and
the group at competitive bidding Oct. 8 on a bid of 102.6199.
Within
turbed the abundant margin pro¬
Washington. On June 30, 1946, the
three hours after the competitive^
tection already provided in Jan¬
three companies owned and oper¬
sale, the issue was over-subscribed for further extensions and imuary; was^ widened iu the subset
ated 2,909,097 telephones, of which
and the subscription books closed. provements.
quent rising market.
" '
1,750,538
were
owned- by 1 the
Proceeds from
/ The
October issue of the
"Monthly Bank Letter" of the National
City Bank of New York carries an article on the relation of stock
market
prices ;.and
credit, - in<S>
'
"
which it is pointed out that al
Jan. 21) have been whittled down
though
the ; recent
break
in as holders have sold shares held
.
v;":
value.
TWO WALL STREET, NEW YORK 5,
N. Y.
•~
;
THE COMMERCIAL & FINANCIAL CHRONICLE
Thursday, October 10, 1948
New ABA President Outlines Plans
C.
W.
Tenn.,
on
Sept. 25 was elected
President of the American Bank¬
ers
bank
relationships.
tion
at
72nd
Con-
vention
held
charting your course and solving
your problems.
Times does not
permit even a limited outline. But
during the year we plan to pre¬
sent to you a factual demonstra¬
tion of what is going on in these
at the Stevens
Hotel, Chi¬
cago.
In his
inaugural ad¬
dress,
deliv¬
ered the
calculated
offices that is
same
to
help
the
Services
fered
by
of¬
-
staff
and
W.
C.
of
York,
Washington and Chicago offices.
He also pointed out that members
of the various committees, com¬
councils
and
will
ferences, improvement of rural
banking, and closer correspondent
relationships between banks.
The text of Mr. Bailey's inaugu¬
ral address follows:
:
.
Today I am mindful of the
compliment you have paid in
electing me to the Presidency of
the
American
tion.
of
Bankers
Likewise
I
am
Associa¬
thoughtful
the
responsibility which you
have placed on me.
In the same
vein, I am aware of the opportu¬
nity which is presented to all of
us to make this year in American
banking one marked by progress
in every phase of management. To
meet the challenge of that oppor¬
tunity will be our goal.
As
look forward to the
we
ac¬
tivities of the, year, I would like,
first of all, to remind you that
there
very many ways in
which the executives and staff of
are
in New
York, in
.Washington and here in Chicago,
can
be
of
great help
to
you
who have
served
all
of
them
well
accomplishment.
balanced
.
is
rural
essential
will aid the rural banker in mak¬
'
Now, here
we are
convention. We
together.
We
are
are
back again in
getting closer
renewing old
look forward
relationships.
We
to years of accomplishment.
.
if
During the
hotel
and
year
other
available, to have
it is
our
correspondent
most
facilities
are
helpful.
ing plans and developing a policy
of successful management.'«
'
So I appeal «for a closer, cor¬
respondent
bank
relationship—
,
on
will
bring members of
staff, and we hope
you will attend and confer
with them and give them an op¬
portunity to contribute something,
out
of
their .broad
experience,
that will aid you in operating the
we
best banks of which you are capa¬
These will be working con¬
ble.
ferences
If
you
have
and
they will be brief.
of the idea and
approve
suggestions to offer,
you should be prompt in making
your
ideas known.
There are
many topics which we can discuss
together : at
these
conferences
some
which will be of great
benefit.
,
■
-
>
Those of you who will be asked
these
official
maintained
spirit of mutual confidence
a
sions,
the
and
that will endure.
to
that
is built
that
of area
bank management conferences. To
a group
be
can
Their experience is
very broad.
Much that they have
garnered from that
experience
one
plan,
banks
serve
with
than
Committees, Commis¬
Councils will be charged
responsibility of perform¬
No one appreciates more
on
or
a
ance.
I
what
available
the
marvelous talent
the
in
is
of
Association
pointments.
period of
membership
to
fill
these
Observation
ap¬
over
a
has developed
years
a
very high estimate of the worth
of this voluntary talent in serving
the
needs
of
the
membership.
Many days of valuable time have
been given willingly and gener¬
ously, often without reimburse¬
ment for out-of-pocket expense.
Those
who
have
^
Because I have for nearly forty-
Served ih the
The
annual
first
If and when' you
I appeal to
spond in the
you
same
of. the Boards of Governors of the
increased to $7.7 billions. The gov¬
ernors
fixed
the
subscription
country, as Chairman for the'next
and
seven
October
on
session
to be called
hence.
year
Secretary of
W.
Snyder,
in London
the
Treasury
the
John
at the
organization meeting
in Savannah, Ga., last March.
$4,500,000 for Lebanon.
Britain, Wins Point'
Early
in
Governors
its
proceedings,
the
of
governors bf the interna¬
tional Fund also approved a reso¬
lution
of
providing for depreciation
the
Monetary Fund admitted to mem¬
bership Italy, Turkey, Syria and
Lebanon. Italy is the first enemy
nation admitted. The only coun¬
action
per¬
or
by art*
caused
urged by Hugh Dalton,
representative
of
the
was
British
,
-
Bank and Fund.
It
was maintained, however, thai
granting the right of a nation
try opposing its admittance was to maintain "full employment"
Yugoslavia. Admission of the four Within the scope of the Fund's
new
members to the Monetary
authority to permit major revalu¬
Fund now brings to 43 the num¬ ations to correct a "fundamental
ber of nations entitled to draw on
its
resources
ligations
and bound by its ob¬
relaxing
for
a
exchange
result of addi¬
io membership and the in¬
art called crease
in
the
of
quotas
France
that
you re¬
and
spirit
as your
International Monetary Fund was
Paraguay the capital of the
in
disequilibrium," the Fund Gov¬
ernors had the right to pass upon
the propriety of the
proposed, to be taken.
"I
offer to sell not a solicitation of an offer to buy any of these Debentures.
The offer is made only by the Prospectus.
».
happy to take notice of
the interpretative declaration now
made
by the executive directors
subject of full employ¬
ment," Mr. Dalton declared. "The
on
the
of the United
Government
an
measures
am
dom
has
King¬
intention
its
stated
to
full
employment and
has requested an interpretation of
the articles of agreement as to
whether steps. necessary to pro¬
tect a member from unemploy-,
of
ment
chronic
a
character,
or
persistent
from pressure
on its balance of payments,
shall
be measures necessary to correct
a
fundamental
disequilibrium.
$75,000,000
This
The Pacific
chronic
a
character,"
unfavorable balance of trade. This
maintain
This announcement is neither
-
nation's currency, when this
appeared necessary to correct "un¬
a
sistent
International
*
The
employment of
New Members Admitted
„
members as
new
$180,000,000 for Italy, $43,000,000^
Turkey, $6,500,000 for Syria
,a
who
was" named
Chairman of both Boards of Gov¬
ernors
quotas for
for
replaces
Dalton
Mr.
tions
on,
country banks throughin out this nation shall measure up
meeting
day session in Washing¬
3, with the elec¬
tion of Hugh Dalton, Chancellor
of the Exchequer of Great Britain
and
the representative
of that
a
ton
thofce, who will s^rve in the fu¬
ture.
the
Meeting
International Monetary Fund and'the International Bank for Recon¬
struction and Rehabilitation ended*-
restrictions. As
that
times when we do»
are
not agree, we must eounsel and
twelve
in every not criticize.
admitted, but
past have set high standards for
three years been a country banker,
I have a very natural ambition
If there
to look
as
Lebanon
national economy.
In the attainment of this ideal
as
over
Chairman of both institutions. Italy, Turkey, Syria and
Russia still abstains from membership. ^
Britain given leeway for altering value of pound.
s
Snyder
sound
a
I want
you
Hugh Dalton, British Chancellor of Exchequer, replaces Secretary
A
banking
to
I have that?
Fund and Bank End First Annual
throughout
this year for redoubled effort and
structure
hence
with
May
from you.
same
shall
months.
so
the Association
those
to
back
capable, and I shall
am
hope for the
\
year
in rural banking, those who serve
have
"work to do," and in mentioning
specific proposals, he recommend¬
ed area bank management con¬
1
country banks, and I
in the American Bankers As¬
sociation.
No general convention
was held and you were thoughtful
of worldwide problems which en¬
gaged
you
in many of
those
you
Bailey
the Association in their New
missions
months of great progress
progress in management
which has been made by many of
these
A
accomplishment. In its attain¬
I pledge you the best of
which I
predecessors. -There "will be work
marked
evidences of
tact with
the
executives
in meeting the bank¬
to do.
During the two years which
have elapsed since last we met
here in Chicago you may have
lost some of your intimate con¬
take- advan¬
ual
ment
new
ing needs of the trade areas which
they serve.
It has been most
gratifying to observe the very
look
,
members to
of
in every way
along the road to the best in
banking.
•
«
/.
you
day, Mr. Bai¬
ley urged the
tage
Says there will be
banking.
That goal can
only be reached through individ¬
work to do by Committees,
Commissions and Councils in ABA organization.
Associa¬
Annual
level of
C. W. Bailey in inaugural address proposes regional group management con¬
ferences and improvement in rural banking.
Urges closer correspondent
Bailey, President of the
First National Bank of Clarksville,
in
Telephone and Telegraph Company
arising
to a request by the ';
Kingdom, will also, I am
sure, be of great
other governments
Forty Year 2Vs% Debentures due October 1,1986
made,
although
declaration,
response
United
full
maintain
to
intention
firm
interest to all
who share our
employment for our own people.-'
Interest
Abstains From
Russia
payable April 1 and October 1 in New York City or in San Francisco.
Membership
~
,
Although Russia was a party to
Bretton
Woods
Conference
the
^
and
set up both the Fund
which
and has had observers $
subsequent proceedings, it
the Bank,
Price 103Vi% and Accrued Interest
at the
has
not'yet formally joined either
two institutions. The final
of the
limiting the period when
can decide whether it will
date
Russia
Copies Ofthe Prospectus
may "be obtained froth only such of the
these Debentures in
compliance with the securities laws
undersigned its
may
legally offer
of the respective States.
-
become a member
December
..
has been set at
31st of this
and
year,
the institutions ;
have decided not to use any per¬
suasive measures to get this one
the Governors of
Five" to join. :
of the "Big
.V
;
•
•
-
f
.
BLYTH & CO., INC.
THE FIRST BOSTON CORPORATION
Advisory
SA
GOLDMAN,
to Have
Bank
World
Board
International
The
MORGAN
an
<-
-
Bank's
<
gov¬
STANL
HARRIMAN RIPLEY & CO.
a resolution to set
advisory board, with rep¬
resentatives of industry, finance
adopted
ernors
KIDDER, PEABODY & CO.
CO.
"
STONE
WEBSTER SECURITIES CORPORATION
:
LAZARD FRERES &
incorporated
i
SMITH, BARNEY & CO.
&
up
an
labor,
commerce,
science
UNION
:
This
SECURITIESNOITAROPROC
^
agriculture,
and the general public.
board
would
have
Chairman
who,
a
to the
according
Bank, "should be a personality of
October 9,1946.
V
.
|
general
three
eminence."
meet
would
months
meeting
of
before
the
council
The
annually
at
the
least
annual
Governors
and
.Volume 164
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4532
wbuld advise the executives who
would
include
the
council's
recommendation
in
their
annual
This is not
^report.
";v;/
vI
;
In the regulations adopted by
Offering Prospectus. The offer of these stocks is made only by
an
These securities, though registered, have not been
approved or
Exchange Commission, which does not
tile
means
of the Offering Prospectus
disapproved by the Securities and
the merits of any registered securities.
pass on
Bank, provision is made for
special meetings of the board of
governors. The
governors are
re-
V quired to meet annually by the
articles of agreement, but the new
:
rules require the directors to call
U. J. HEINZ COMPANY
•
.•v.;.,;;.;
a
special meeting whenever re¬
quested by five bank member na«t
tions or by members having at
least one-fourth of the total voting
'<••••'."'
'
.•
*
•
"
MAKERS
OF
••
•'
-
N'
>*57
THE
'
••
1
:
.
VARIETIES'*
%-K
f
;
;
'*
•
/
"[
H
V
•
\:y
,'
•..
/
/,
'
'
;
'
V'
.
,
,
'Ji"\
*>1''
t' 1
,1'
/
?
100,000 Shares 3.65% Cumulative Preferred Stock
;,
^
,
.
(par value $100
a
share)
"
■
-
,
.
•
power*
200,000 Shares Common Stock
(par value $25
Cobb Is Adv. Mgr.
j
of
Distributors Group
share)
a
.a
The Preferred Stock is redeemable, at the option of the Company, in whole or in
part, initially at $107.75 and accrued dividends
and is also redeemable through operation of the sinking fund
initially at $105.25 and accrued dividends.
i
These redemption prices decrease periodically on and after October 2,1951.
The appointment of William T.
An annual sinking fund payment
equal to the lesser of (a) $200,000
Cobb
;
as
advertising manager of
Distributors Group, Inc., 63 Wall
Street, New York City has been
i
Minnesota, New Jersey, New York, Ohio, Virginia and Wisconsin and for
;
f tions, vadver* tising and
production
-
for
of
the
tributors
of
*y //. J. Heinz Company, incorporated in Pennsylvania in 1900, succeeded to a business
originally
founded in 1869. The Company and its subsidiaries are engaged in the processing,
packing
ketchup ayd other tomato products,
baked beans, pickles, vinegar,
spaghetti and condiments. The Company sells directly to retail outlets including
about 200,000 grocery accounts.
i
and sale of
v
s,
in¬
fk
the
CAPITALIZATION
William T. Cobb
Mr. Cobb
4
^nncarly
Vice-President of
was a
also
writer
served
on
as
h
r
editorial
director
nounced
ecutive
Companies
the
election
,
*
*
'
'
'
its
Ex¬
.
100,000
None
None
..
1,409,064**"
1'
'
the Committee
,
4
,
^
Net
'
Net Income
for
Transferred
Contingencies
$4,345,260
* 3,399,213
1939
58,827,133
62,715,172
62,021,688
to
Year
4,647,369
2,945,307
1,085,792
Net Income
•
'
■***■■*"*.
;v
<
--
Before
1942
1943
1944
-
3,561,577
1945
1946
Provisions
Net Income
Provisions for
Net
Sales
for
*
'
Transferred
;
.
Ended
April 30
Surplus
$.........
$4,345,260
100,000- 3,299,213
100,000
2,902,604 ,:
500,000
2,445,307
3,002,604
1941
Provisions
/v
.
1940
jA-A
Contingencies Contingencies
$71,900,304
84,076,441
$3,922,484
3,650,797
93,351,553 :> 3,888,748
112,815,488
4,482,054
114,150,564
4,680,892
-
$ 698,434
330,763
224,183
1,082,020
,
628,808
to
v>
Surplus
$3,224,050
3,320,034
3,664,565
3,400,034
A
4,052,084
dividends
The Company has paid a cash dividend on its Common Stock every year since 1911.
Consolidated
'net profit exceeded cash dividends in each of these
years except in 1932, when dividends were
$1,500,000 and earnings were $88,766, and in 1933, when dividends were $1,200,000 and there was a consolidated
net
loss of $880,824. The Treasurer of the Company intends to recommend at the December
quarterly dividend meeting of the Directors o f the Company that a dividend of 45c a share on the Common Stock be
paid in January 1947.
preferred And
The Cumulative Preferred Stock has
COMMON STOCKS
as
'
»
l"
no voting rights except certain
special voting fights
specified in the Articles of Incorporation. The Common Stock has one vote per share.
fully paid and non-assessable, except for statutory
The Preferred and Common Stocks will be
liability for salaries and
underwriting
wages.
Subject to certain conditions, the Underwriters, named in the Offering Prospectus, have
severally agreed to purchase the Preferred Stock at $100.50
R.; SherVice-President,
Equity Corporation; Merrill
Griswold, Chairman, Massachu¬
a
S the Common Stock
share and accrued dividends and,
at $38.80 a share. The aggregate offering price to the public for the Preferred Stock is
$10,275,000
and accrued dividends and for the Common Stock $8,200,000. The
aggregate underwriting discounts are $665,000.
Jr.,
James
Before
•*'/'
Contingencies
"jv
$53,980,692
1938
57,080,913
Corporation;
Trust;
TnoortlG
Provisions for
■■
Sales
are
.
V
*
The following condensed summary of earnings of the
Company and its consolidated subsidiaries
1937
The
Investors
>*
has been
•
.
Ended
April 30
,
Hugh Bullock,
President, Calvin Bullock; Paul C.
Cabot, President, State Street In¬
Elliot,
(-
Year
.''v/
M:
?
•
' •;!' the
Net
Continental Corporation; and S. L.
•
H.
;
v
Price of the Preferred Stock $102.75 a share
Orr, President, Railway and Light
Securities
Company;
Harry
I.
r
-
and accrued dividends
Price of the Common Stock $41
Prankard, 2nd, President, Ameri¬
a
shore
Business Shares, Inc.; Dorsey
can
Richardson,
Lehman
Wick
Vice-President,
The
The Underwriters have
Corporation; and Hard-
Stires,
Partner,
and
agreed to purchase the Preferred and Common Stocks when, as and if issued
subject to the approval of Davis Polk Wardwell Sunderland 4' Kiendl, counsel for the Underwriters
and Reed, Smith, Shaw
§• McClay, counsel for the Company, and to certain further conditions. It is
expected that delivery of certificates for the Preferred and Common Stocks will be made on or about
October 1$, 1946, against payment therefor in New York
funds,
>
•
Scudder,
Stevens & Clark.
John M.' Sheffey continues as
Executive Secretary of the Asso¬
TO
THE OFFERING. IT IS INTENDED TO STABILIZE THE PRICES OF THE PREFERRED
AND COMMON STOCKS.
STATEMENT IS NOT AN ASSURANCE THAT THE PRICES OF THE ABOVE
SECURITIES WILL BE STABILIZED OR THAT
THE STABILIZING, IF COMMENCED, MAY NOT BE
DISCONTINUED AT ANY TIME.
FACILITATE
ciation.
:
Wmr Byrne Partner in
Campbell, Phelps & Co.
William
■
"v
prepared by the Company and has been reviewed by Touche, Niven & Co., independent ~
public accountants. This summary is subject to the financial statements and summary of earnings in the
Offering
Prospectus together with the notes thereto.
:
'
>
Sholley, President, Keystone Cus¬
todian Funds, Inc.
Those continuing to serve on
setts
(shares)
None
-
V
Quinn, Vice-President, Tri-
rard
this financing <*
The net proceeds (estimated at $17,680,350, after
expenses) will be
-
earnings
an*J
Committee of Herbert R.
vestment
Giving effect ta
(shares)
,
,
,
Anderson, Executive Vice-President, Group Securities, ^ Inc.; O.
Kelley Anderson, President, Con¬
solidated Investment Trust; Harry
A. Arthur, President, Blue Ridge
Corporation; Charles F. Eaton, Jr.,
President, Eaton & Howard In¬
corporated ; R. E. Macgregor, Pres¬
ident, Investors Syndicate; Cyril
J. C.
•
applied to the extent of $5,150,000 to
redemption of the 4% Cumulative Preferred Stock; the remainder (estimated at $12,530,350) will
I r*, be added to the working capital of the Company. These funds
may be used for inventories, investv-f - ments in accounts receivable, reduction Of bank loans, improvement of plants, or the
purchase of additional equipment or other property or businesses. If additional funds are required, the
Company may provide them out of its
cash resources, or from the proceeds of the sale of additional
securities, or from borrowing. ~
>.£*'. • %
"
r
has
to
purpose
OP issue
Companies Ass'n
vestment
.
«'<
f
The National Association of In¬
,
Outstanding
J
:
^
Exec. Committee of
<
'
—
Inv.
one in England, one
operations this year.
Bank loans amounted to $2,500,000 on April 30, 1946 and by
September 30,1946 had increased to $14,500,000, due
largely to seasonal crop purchases and increased inventories.
v.
B
'
of
Cambridge Associates, Boston.
•4
Canada,
commence
f
17*o be redeemed and cancelled. \\4 series of the Cumulative Preferred Stock ($100 par) of which 100,000 shares
are authorized. *Excludes 57,78*) shares in
treasury. **0n October 8,1946, the Common Stock ((100 par) was
split on a 4 fori Mais.***Excluding £50,936 shares remaining in the treasury; the remaining 860,000
author*:
teed shares org unissued.
'
„
"The Wall Street Jour-
and
n
\4% Cumulative Preferred ($100 par) {authorized SOJIOO shares).
r 50MQ
\ ft3.65% Cumulative Preferred ($100 par) (authorized 100,000 shares)..... V: None
jM *Common Stock ($100par) (authorized 360,000 shares)
302,266
**
.
nal"
i
1
Common Stock ($25 par) (authorized 2,000,000 shares).
editorial
an
410
,.
Frank-Guenther Law, ad¬
vertising, and prior to that time
copy director of the agency.
He
lias
.
April 30,1946
'<
'
Albert
-
expected to
*
*.,
i
%
in
country.
-
The Company now operates 13 factories and its subsidiaries
operate 2 factories in
an olive plant in
Spain. A second factory in England is
v
'
>
extensive line of food products, including soups, baby foods,
an
in Australia and
vestment
funds
f
THE COMPANY
}
Group Secur¬
ities, Inc., one
of the largest
mutual
\'i
"
Jersey.
The Company will make application for the listing of the Preferred
Stock and Common Stock on the New York Stock Exchange.
following is the Company's brief outline of certain information contained in the Offering Prospectus and is subject to the more detailed statements in the Offering Prospectus and the
Registration
Statement, which also include important information not outlined or indicated herein. The
Offering
Prospectus should be read prior to any purchase of these stocks.
company, dis^
'
.
trust funds in New
The
litera-1
■sales
i ture
Pennsylvania, and
Connecticut, Iowa, Massachusetts,
Cobb will
supervise
public rela-
,
or (b) consolidated net earnings of the preceding fiscal
to be applied to the retirement of Preferred Stock through purchase or redemption«
after preferred dividends is
In the opinion of counsel, the Preferred and Common Stocks are
exempt from personal property taxes in
;5 the Preferred Stock is a legal investment for life insurance companies in
annouiic.ed.
i Mr.
pear
r
made
D.
Byrne
partner
a
of
has
been
THI&
;
Further information, particularly financial information, is contained in the
Registration Statement on file with the
Commission and in the Offering Prospectus which must be furnished to each
purchaser and is obtainable
from only such of the undersigned as
may legally offer these securities in compliance with
the securities laws of the
respective States.
'
'
•
"
'
*
.v'.-V
•
*
'V:',v-v..
■'■
•;
■■
,
-'--V
A'-*
Campbell,
;
-
v'-1-'.'
Av.--.
v-v.-,;;.
r
/.
■-1
•
:
-■
MORGAN STANLEY & CO.
Phelps & Co., 70 Pine Street, New
York
.
City. Prior to the
Byrne
&
was
Co.
war
and
subsequently
H. C. Wainwright & Co.
ager
of
Mr.
associated with Shields
the
municipal
as
bond
HARR1MAN RIPLEY & CO.
J
Incorporated
SMITH, BARNEY & CO.
BLYTH & CO., INC.
with
man¬
GOLDMAN, SACHS & CO.
KIDDER, PEABODY & CO.
"
GLORE, FORGAN & CO,
UNION SECURITIES CORPORATION
de¬
partment of the New York office.
THE FIRST BOSTON CORPORATION
DREXEL &
Dated October 10,1946
CO.
MERRILL LYNCH, PIERCE, FENNER & BEANE
^
'
THE COMMERCIAL
1792
Batiks
^
Look
.
Thursday, October 10, 1946
-
Forward
By FRANK C. RATIIJE*
•
.
FINANCIAL CHRONICLE
&
V
"
\
-
■<••*
Retiring President, American Bankers Association
President, Chicago City Bank & Trust Co.
,
Tile
Retiring ABA President asserts war's end has brought neither
past f year has been full
of rapidly moving events for the
banks
and
the
economy.
the year,
I had the opportunity to
with;
many bankers
thro u g h o u t
nation.
have
I
ernment
velopment and concludes, that despite difficulties,
,,
.
the
country. They
),
ieanonst rate
[
said
lending
to
have
ically
popular, there is a threat
they will be continued dur¬
period when employment,
that
ing
a
prices, and general business activ¬
ity are at a very high level, and
when
able.
ample bank credit is avail¬
:
fundamentally sound. J
/.■
be
useful contribution in aid¬
a
reconstruction
years.
Because
those agencies proved to be
polit¬
gov¬
is
economy
government:
may
ing business to rehabilitate its
productive activity in those early
f.
observed],
bank-;
in
every j
of
made
lending agencies.
among
ers
agencies
Sees danger to normal credit structure in
government guarantees and expresses concern regarding future
dollar stability. Holds profit incentive essential to economic de-
been
section
These
economic
peace nor
fur increased credit controls and attacks credit expansion policies of
;
deeply
i mpressed by the
spirit which I
have
*
stability and wartime problems remain. Says instability makes it extremely
hazardous to make long-term commitments, since current price levels and
incomes may decline again. Criticizes Federal Reserve recommendation
During
meet
the
;
,
Danger of Government
Guarantees
the
technique of banking; and to rifices made by the veterans, the this type would obstruct banking
It is to be known that the banks
It
should
training the personnel of its mem¬ Servicemen's Readjustment Act services.
be
avoided
ber banks Jo a higher degree of was passed in June, 1944. In spite until such a time as the absolute of the nation are now building a'
credit C structure
based
efficiency ih serving the people of the commendable bbjectives of necessity therefor prevails and is normal
upon sound credit risks.
To add
of
this nation
in an important that law, in its actual operation, fully recognized.
V
v
to that normal credit structure a
it 'was found to be unworkable.
In this connection, it is disturb¬
phase of our national economy;
interest ih, * >
and ah • alert¬
an
v
.
.
to; the *;
problems that j
ness
Frank C. Rathje
Rapidlyl •changing
conditions, Accordingly,; changes were en¬
important, ,i
not only in our domestic monetary acted in December 1945, with the
only to the banks; but to all
affairs,
but: internationally
as purpose of remedying the existing
segments of the economic activity
Unquestionably,
these
well, make it an ever greater ne¬ defects.
is the natiori. 1
cessity" that we equip ourselves amendments represented an im¬
I
founds : in'- attending State with that
knowledge which will provement of the original law.
conventions, that the programs of enable* us to- render
r'~f.
;> *. iV"-.
V
X i'
corrtpetent
those meetings were devoted to
Wartime Problems Remain
service in .all phases of the bank¬
both
a
discussion
of 'problems
ing business. /.
However, there yet remain prob¬
that were local in
are
,
not
- •.
nature; and to
problems relating to the national
economy.
This is a reflection of
•
j
<
lems which should be
cause
for
ing to observe the
inconsistency
between the various governmental
agencies
policies.
with
Board
serve
respect to credit
the Federal Re¬
While
tional power
pansion,
is
requesting addi¬
to control credit ex?-
other
agencies
are
governmental
engaged in vigorous
efforts to expand credit.
v
The
Patman
Bill, establishing
are sin¬ an emergency housing program,
the welfare which in many respects has laudr
m
basic
political philosophy in
women who had
given to the na¬ of both the veteran and the econ¬ able objectives, provides for in¬
the United States—the dual sys¬
tion their heroic services.
More omy. The present phase of eco¬ surance by the Federal Housing
tem of government.. By the use of
than a year has passed since the nomic activity may be one in Administration of mortgages
State
and1 ]local .■• governmental
end of the war.
Those months which it is extremely hazardous bearing a ratio of 90% to the cur¬
units to deal!with local problems,
to enter into long-term debt com¬ rent necessary costs of construc¬
Ml advantage-is secured of local have brought neither peace nor
mitments.
Construction; costs
have
Currently,
employ¬ tion.
initiative. This is a source of self- economic stability. We have found
our
disappointment; ment; prices, and incomes are risen since 1939 by 65%. If we
reliance, and provides a medium again, ; to
our
history, experience future fluctuations in
for freedom (of thought and' ex¬ that wars do not. solve all prob¬ high. 1 Throughout
lems. In some instances, wars ag¬ market values have-fluctuated. If costs similar to those which have
pansion.,;; Likewise, -a
national
the past is a guide to the future, occurred in the; past, the mort*government exists to deal with gravate existing difficulties and
create
new
misunderstandings. there is a probability that cur¬ gages based upon current levels of
prablems of Ji national and inter¬
rent levels of prices and incomes costs of construtcion will prove
national scopes This dual system What we tried to achieve at so
will
decline again,
*„
Hi
at least to to be unsound.
is an element of strength in our great a cost in the recent war,
\
The Wagner-Ellender-Taft bill
form of government, and in our was an assurance that we would stable values. If this occurs, pres¬
have the opportunity to solve in¬ ent commitments entered into by is not designed to meet the
mm organization as well! In
pres¬
every
the veteran
may
constitute for ent housing shortage. It is alleged
State convention, there was dem¬ ternational problems by the use
him a burdensome obligation.
It to be a long range housing pro¬
onstrated a keen understanding of of democratic principles and pro¬
is the responsibility of all bank¬
of
local
gram.
Your association made a
problems * and ;;a
full cedures.,! To us, that right was so
valuable
that
its
establishment ers, that we lend the veteran not careful analysis of this bill and
recwignition of the economic de¬
was
worth
any
expenditure of only capital for sound ventures, testified against it. It was not re¬
velopments Which only a national
effort which was required to cre¬ but make generous contribution
ported out of the House Commit¬
organization 'is] ..in a position to
ate it;
It is to be hoped that we to him of our experience.
The tee considering it. In our study,
treat with effectively.
'
may now be permitted to
solve veteran needs advice and coun¬ we found most of its provisions
■;
j ;
In 1 many
cases,
competent not only unnecessary, but highly
those problems by peaceful means, sel.
;
ABA Activities
guidance will be of greater value inflationary.
Your national organization is yet not to a point where we will
sacrifice the dignity or the in¬ to him than the assumption of a
well prepared to carry out its re¬
This bill provides for insurance
debt, for whatever purpose cre¬
tegrity of this great nation.
sponsibilities.; The broad range of
by the Federal Housing Adminis¬
ated, which he may find an undue tration! of
Your association planned early
activities carried on by ; its many
mortgages bearing a
burden in the years to come.
ratio of 95% to appraised value.
commissions and committees, and to help the veteran readjust him¬
self in his business, in his
the
In the years ahead it can result
services £; performed
home,
by
its
Credit Needs of Small Business
in $60 to $80 billions in new mort¬
staff, cannot be adequately de¬ on his farm; and in his com¬
We realized that mem¬
scribed.
When the war ended, much was gages, with such mortgages hav¬
It is to be realized that munity.
forces had, said of the credit needs of small ing a final maturity date of 32
the American Bankers Association bers of the armed
is fundamentally an educational throughout
their
service,
re¬ business concerns. We recognized years.
When we realize that the
mained
civilians
at
heart, and that the war had caused the dis¬ increase in the mortgage structure
institution, devoted to improving
their cherished desire was to re¬ continuance of thousands of small
during the decade of the 1920's
once
*An address by Mr. Rathje be¬ sume
more, the ways of business units for its duration. We was $20 billions, one is prone to
fore the 72nd Annual Convention peace.
also recognized, that with the re¬ be
deeply concerned about the
of the American Bankers Associa¬
As one. of the expressions of turn of peace, the opportunity destiny of the potential mortgage
tion, Chicago, 111., Sept. 24, 1946. the nation's gratitude for the sac¬ must be provided for small busi¬ structure that would be developed
.
In the fall of 1945, the national
government was in the process of
demobilizing 12 million men and
a
deep concern to all who
cerely interested
in
•
-
large
volume
.
of
credits ;
.
guarantees
upon
-and
based
insurance
provided by the Federal govern¬
ment, or its several agencies,
stitutes
con¬
danger to our general
economy of grave proportions.
Of a more serious nature is the
provision of the -Reconstruction
a
,
Finance Corporation
pronounce¬
ment, which results in the virtual
abolishment
of
the amount
the! limitation
bank may loan
single borrowers A bank can,
Without criticism ; of the super¬
upon
to
a
a
visory
four
authorities;
times
its
make
a;
loan
statutory lending
limit, with the Reconstruction Fi¬
nance
Corporation guaranteeing
the
This violates
excess.
tion of long: standing
proved
of
a
value
great
tradi¬
which has
to
the
soundness of the banking system.
The destruction of this funda¬
_
mental principle of banking-is to
be
regretted.
One of our past
presidents has devoted much time
and
thought to this activity.
will
address
this
He
convention
on
that
subject tomorrow; at greater
length. t> ' I',v ^
;
The Future Price Level
! Traveling
throughout
the
na¬
tion; I found that the problem of
greatest
concern
that
the
of
level.
of
to bankers
future
of
the
was
price
Examples of different types- rises
in the countries
price
throughout the world during the
period between the close of the
World War, and the begin¬
ning of World War II, are nu¬
merous.
Of course, we are in no
danger of the German monetary
experience which culminated in
the extreme currency inflation of
first
1924.
The American dollar is the
strongest man-made force in the
world today, and will continue to
be
so.
This is not to say,
that its
purchasing
from
fluctuate
however,
power may not
time
to
time.
.
ness
units to
means
PACIFIC COAST
r
11
•
\
t
* ,l
'
v
/
v
'%>■
-.V4'/"'i'-,;!' W "."''"v.-!; -V: -i
I
A
'«
•*
v
'
''
,
r<y
^
V"!
and
not
needs
credit
As the
American
groups.
of
business, large and small,
vided,
are pro¬
building a credit
structure within the banking sys¬
tem.
are
we
That credit structure should
carefully developed,
will not be vulnerable
so
that it
to normal
Co.
a
of
Governors of the Federal Re¬
serve
System,
additional
powers
requested for the purpose of
controlling credit expansion. The
are
14 WALL
STREET, NEW YORK 5, N. Y.
;
bankers of the nation
Telephone BArclay 7-4300
vinced
SAN FRANCISCO
,
•
LOS ANGELES
•
*
HONOLULU
.
of
costsf of
the
is
present
due
to
materials and
construction,
lack
of mortgage
money.
of credit stimula¬
abnormal processes is
represented by the Reconstruction
Finance
Corporation's
blanket
*
Another type
tion
by
participation program.
ulus to credit
The stim¬
expansion given by
clined.
fluctuations
These
were
based upon changes in the supply
of goods
available and the demand
therefor, with the monetary unit
based upon the
statutory price of
gold essentially stable.
The
example
of
the
French
franc, however, presents a differ¬
ent picture. 1 At the outbreak of
World War I, the French franc
was
gold,
valued
or
at
in
19.3c
terms
to one American dollar.
its
value had
where
of
approximately five francs
it
was
By 1933
declined to
worth
a
point
15 francs to
lAnHinf
incomes,
Lending;
LOS ANGELES STOCK EXCHANGE
to
The
housing
and de¬
Reserve
prices,
In the last report of the Board
SAN FRANCISCO STOCK EXCHANGE
Security and Commodity Exchanges
rates.
War, prices
rose
desirability or the
necessity of this legislation, as it
is recommended by the Federal
in
Credit Expansion and Government
MEMBERS
and other principal
-
in the United States
is unnecessary and
the dollar.
As a consequence of
untimely.
The
banks,
at
the
seven
- successive
* statutory
de¬
present time, have sufficient re¬
valuations, the most recent in
sources to meet
any demand for
December, 1945, the franc has de¬
credit required by American busi¬
clined
in
value
to
an
official
ness of all types.
An aggressive
level of 84/100 of one cent, or 119
policy of
credit expansion,
at francs to one American
dollar.
present price levels, by a govern¬
This is an example of a monetary
mental agency, is to invite the
deterioration,
which
was
not
danger of speculation and overdominated by variations in the
expansion.
I
supply of, and demand for, goods,
Many of the government lend¬
but by a permanent decline in the
ing activities were initiated in
purchasing power of a monetary
the early
1930's, when employe
unit.
!
ment and prices ; were low, with
In the United States, since 1933,
fear
a
dominant
influence
in
ity.
HONOLULU STOCK EXCHANGE
new
high
and in the level of business activ¬
NEW YORK STOCK EXCHANGE
of
shortages
fluctuations
Dean Witter
reasonable
at
the
be
Direct Private Wires
:
ample
lack
the
of
v'"
;
is, at the present time,
mortgage credit available
There
individual
sound
V-
'
was
facilities
creation of credit
HAWAIIAN SECURITIES
'
under this bill.
banks, by the extension of corre¬
spondent relationships and by the
lending
Sill
AND
'
the financial
made for
the extension of adequate credit
to these units by the use of the
Provision
prises.
1i I
secure
reestablish these enter¬
to
'After the first World
of
are
not
con¬
the
Board.
••■*
Legislation
of
this
program
,
flptlVltlGS.'
<
'•*
"
i
o5ernifir>ur»+.
nhanHAe
.
hftVP
•
-1nlran
■
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4532'
Volume'; 164
place in our monetary affairs, the
effects of which we have not yet
fully learned.
One: In
March, 1933', the United
States abandoned the gold stand¬
land
the
those
tinued world
began to lose leadership in
lines of foreign trade in
which she had enjoyed world su¬
premacy
for a long period of
United
dustrial
States
for
philosophy in government which
con¬
leadership in its in¬
and
economic
ment, depends in
years.
has
a
1793
develop¬
higher, and the world-wide davas-
forefathers established.
our
Our Economy
large measure,
tation
wrought
much greater.
Fundamentally
tory
Sound
which
tremendous
by
the
war
was
However, if the vic¬
achieved
we
at
the
of
cost
lives, materi¬
Labor should recognize the cru¬
The American economy is fun¬ als, and financial
ard.
resources, has
cial role which it plays in the eco¬ industry to carry on the technical
damentally sound. Our productive purchased for us the opportunity
Two: In January of 1934, the
nomic life of the nation, and ex¬
is the greatest in the to solve these problems through
progress which has been a source potential
price of gold was increased from ercise with a
high sense of re¬
world. It is true that we have
democratic processes, then
with
of strength for this nation. Suffi¬
$20.67 an ounce, to $35.00 an
sponsibility the power which has
problems at the present time, but faith, ; courage, and devotion to
v.:. come into its hands.
Without the cient incentives must be provided we have had
problems at the end duty, our problems can be solved
Three: The volume of money in
opportunity for reasonable prof¬ to all elements in the productive of every war. The difficulties we in a
way which will justify an
circulation
has
increased
from its, the incentive to improve busi¬
process, to function at maximum facev are of greater magnitude in ever
greater confidence in our
$5^ billions, in 1933, to over $28 ness operations and techniques in
billions currently.
this country will likewise be im¬ efficiency. Labor, too, must recog¬ this instance because the propor¬ American way of life.
;
the
upon
Four:
of
time,
creased
During the same period
bank deposits have in¬
from $37 billions, to $150
paired.
nize
V
The
.
great
opportunity
incentives provided to
that
it
has
a
stake
in
the
which free enterprise system, and in the
tion of
our
national
voted to this
war
de¬
resources
effort
much
was
I
still
have
great
faith in
future of America.
billions.
■HiiiiP
Five:
The: required reserve of
certificates against Federal
Reserve notes in circulation has
5
*
<
+
"■
'
^
gold
been
.reduced;froin^40%/ ;to:25%.
'
Six: Likewise,\the
required gold
against ( Fed-:
eral
Reserve Bank deposits has
been decreased from 35%, to 25%.
certificate
reserve
Seven: Wage levels have- in¬
creased since^ 1939 by 60 %; .
s
The
which
problem
is
uppor-
most- in the minds of many
stu¬
dents of the economy at the pres¬
ent time, can best
be expressed in
two questions:.
in the
First: Are the increases
price levels: that have taken place
due
to
temporary scarcities, in
supply and a temporarily in¬
creased
demand?
worldwide
or
Second: Are the price rises due
to
fundamental
changes in
monetary affairs since 1933?
Whether your interest in Great
our
Britain is in business
•
Either the: economists who pre¬
dict a "boom and a bust" are
right,
or we
level
Chase, the oldest American bank¬
have moved our price
permanently.: higher
plateau. It is possible, also, that
the changes in the price level
Which we" are currently experi¬
encing represent a combination of
both factors, and that both are ex¬
erting their force. ;,
to
a
ing organization iri London, with
three
Problem
-
<
-
which
to
continue
throughout the United Kingdom, is
take
admirably equipped to
■v.v..;
5",
sound conclusion
tions.
the
these ques¬
on
'£
•,
place, make it impossible to reach
a
t
-* ,'.i
:i:- fr>.
Nevertheless, this is one of
crucial problems which
y.-/-
»v
(_
,
in close touch
are
vV'C-y; / •'
•
$yl.
•
i*';** yv{?V,\'Y'v'
<
^1'
!
velopments in Great BritainJ and,
which
studied to
follow the trend that is developed.
be
continuously
the
Unquestionably,
labor
unions
activity
of
will
tfe
^
Labor
move.
costs
a
petition to bfc
Americans
(
a*
\\1!_ £
British
who have
y;y
to
\
^
•
'* Y~1
V"/V
.
'
:
4
"BIG BEN" still booms from Westminster's storied tower
pealing over the Mother of Parliaments in
Visitors to London today note the marked
resurgence in the business and general activity of the
capital of the British Empire.
4 j/vi'S
.
.
.
its shadow
business interests.
•
.
-'.
,
•
'*
1
•*
'11
(*
1!
repre¬
jf
* *
i
■—'
'
a
in
are
•
nf particular assistance at this time
\
must
result,
as a
play - a domi¬
nating role in affecting the future
level of prices. It has come to be
generally
recognized
that
the
costs of production are the pivot
around
which
the
price
level
major portion of the costs
If you
It was the sizable
wage
increases
given to labor
unions in the early part of this
year which represented the main
force that broke the price line
production.
on
trade
'
/
seeking to maintain.
our
In the United States, there were
,* 1
Y
• ;% J
'**6
7" .£
-
Oi
? J\ /V-
|
;l!
| J
v'vlv
I)
;
II
travel in Great Britain,
or
cordially invited.'-j to consult
%*!•
I
|i
sCX. -C»
have a requirement; touching
you are
which the Administration said it
I
serve you.
";'kf "-"<HJvv'rA'-v-! V'vro>'• ,»
-C
£ l\.
.
*u' •
'
fV-'j/;.
*.•
with commercial and financial de¬
and banker alike. It is one,
must
was
^
the American business man
faces
of
*
■».
Chase officers
most
sent
correspondent banks
.
develop¬
rapidly moving
.The
ments
centrally located branches,
and British
Stability of Dollar a Crucial
c
travel, the
or
,v
-
"*
r'vY'-
i
A
!
'
'V
r
'»!*:
Foreign Department officers.
nine million unemployed in 1939.
This
that
the
1930's
Wm
These facilities are also at the dis¬
due, in part, to the fact
wage levels had risen during
was
at
faster .rate
a
than
posal of Chase correspondent banks
labor's productivity. T As a result,
the volume of profitable opera¬
tions was so curtailed that large
numbers
were
illllP
in the United States and
unemployed. There
able them
is general agreement that the de¬
to
often
broaden their
en¬
BUSH
.
mands
of
of
cause
ment
>
labor
the
were
Reports
conditions
situation
of the
of
the
which
such
over
the
ers
a
an
of
measure
in¬
re¬
TH E
improve
and
This
for
had
the
.
im¬
conse-
export
As early as 1938, (Eng¬
>
-
BAN K
LONDON—6 Lombard Street
Havana
•
San Jean
•
Panama
•
Colon
•
Cristobal
•
THE CHASE BANK;
r'V
*
-I
corner
of Nassau
Member Federal Deposit Insurance
Corporation
Paris
•
•
»'
*>
M
'
VI
51
Berkeley Square
Balboa
Shanghai
•
,
Chase
t}
♦
•
Bush House, Aldwycb
Offices of Representatives: Mexico
•
Hong Kong
•
Tientsin
City
•
SQUARE
branch
in
Mayfair is in the center of
the hotel,
shopping and
theater districts of London's
fashionable West End.
headquarters,
N AT I ON A L
HEAD OFFICE: Pine Street
own¬
were
serious
British
51 BERKELEY
—This
OF THE CITY OF NEW YORK
modernize
buildings and equipment
markets.
"City," London's great
financial district.
CHASE
control
incentives of industrial
qences
heart of the
is in the very
industry, and exercised
large
paired.
STREET—The
branch, opposite the
Bank of England,
When in London, make the Chase
your financial
industrial, operations, "that
to
LOMBARD
groups
the
of
6
main London
French
labor
proportion
of
End.
economic
during the 30's took such
wards
service to customers.
in England point to a
in
creasing
'i
impair¬
progressive
of the value
franc.
major
a
.
HOUSE, ALDWYCH—In
one of the best known
business ad¬
dresses in Iendon, this mid-town
branch of the Chase is also conve¬
nient to the social life of the
West
own
Cairo
•
Bombay1
the
THE COMMERCIAL &
FINANCIAL CHRONICLE'
Thursday, October" 10," 15)46
Fiscal Tasks Ahead
By HON. JOHN W.
>
'
♦
It is
a
bankers
self to
of America.
t feel my¬
and,
so,
say
' among
This
friends.
is by (no means
the first meet¬
ing
of
-
Am
e
the
-
rica!n
Bankers Asso¬
ciation I have
privi¬
been
leged
at¬
to
tend. But it is
the
first
have
b
have provided an opportunity for
a frank interchange of ideas. They
I
e e 'n
privileged
•;
again
confirmed
long-
my
held conviction that the
an
community is able and willing to
look beyond its immediate self-
in
official
.
have
t o
address
John W. Snyder
transactions,* willtake
acknowledging great aid afforded by banks to ^Treasury
during and following the; War, calls for Continued cooperation in fiscal tasks t
ahead.
Points out primary effort on fiscal front is; to Achieve a balanced j
budget, and asserts "we have done better than most people expected."*
j
Says Government economies are put in force wherever-feasible; but ex
penditure8^particukrly ? for defense and debt service,: remain high;"
Holds present tax levels must be maintained and interest rates
remain low, and cites redemptions of short-term Govt, notes
and campaigns to increase Savings. Bonds sales as evidence
of a policy of debt reduction to offset monetary inflation.
^
to talk with the
be among colleagues
/
if I may
'
Secretary Snyder, in
genuine pleasure for me
to be here today
SNYDER*^]
Secretary of the Treasury
capa¬
financial
city as Secret interest; -and to consider the fi¬
tary of the nancial problems of the country
vv-"
iivThus,,for.example;-,most of the'
terminal
leave..pay—that is, over
$2,000,000,000 of it—will not be%>
paid in cash, but rather in termi- •
pal leave bonds. • Also, the inter- *
est' accruing: ' on
Bankers
are;
heavily11
represented throughout the state
organizations in the present sav¬
ings bond sales program, just as
they were in the days of the war
loans. Many large industrial cor¬
same
fine service
on
nal leave bonds when
their termi¬
they mature
you are nOw
bbhds'theyown.
All of this
is, of
in addi¬
course,
tion to ^the , work x that yoii are
.
from the point" of view of the porations have continued the pay¬
roll savings plan into the postwar doing rfor us ori ' sayings bonds
I;welcome this opportunity for well-being of the whole people.
two' reasons:
First, I want to
period primarily because of^the which is so important to the suethank the bankers for the mag¬
Cooperation of Banks and the
influence, economic vision, and (Cbssvbf^that;^pgranLi'' *;i%!'•
.
Just-a little'-bve'r a year ago we
Treasury :
nificent service they have ren¬
public spiritedness of the bankers
celebrated the end of the war.
dered the country; and second, 1
The tradition of cooperation be¬ on their boards of directors.
want to talk about some impor¬ tween
the banking system
I want you to know that this Toddy We have largely converted
and
from the ways of war to the ways
tant matters that are of mutual
the Treasury is one of long stand¬ cooperation is deeply appreciated
of peace and this conversion has
interest.
*
>M; ' :
ing. But I need go back no fur¬ in the Treasury. Indeed, it seems
been so rapid and so successful
On the first score, this meeting ther than the war to illustrate how to me a condition indispensable to
that our levels of production, inwell it has worked.
seems a fitting occasion for me to
the economic health of the nation."
During
the
war,
the
banks The government's 'need of assist¬ cbme, \ and "employment fits' all
express again my personal appre¬
ciation for the help and coopera¬ threw themselves wholeheartedly ance from the banks has certainly closely comparable to the high
levels we reached during total
tion which I have received from into the sale of United States se¬ not ended with the termination Of
Treasury.
'
-
,
profession, during my
tours of duty as Federal Loan Ad¬
ministrator, as Director of War
Mobilization
and
Reconversion,
the banking
curities.
the
They gave generously of
of
time
their
their staffs and
the
executives
and
their facilities
in
campaigns and in
and as Secretary of the Treasury the
continuous sale of savings
since my appointment to that of¬ bonds.
They cooperated with in¬
dustrial corporations in the estab¬
fice.
During the past two months, in
particular,
Committee
I have
met
with the
Government
on
Bor¬
SavingsV Bond
Association,
and with groups representing the
savings banks, the insurance com¬
panies, and other types of finan¬
cial institutions. These meetings
and
Committee
the
of
your
lishment and maintenance of pay¬
roll savings plans.
der before the 72nd Annual Con¬
Association,- Chicago, 111., Sept. 24,
'
.
contributed in no small meas¬
pons
ure
the ability of the govern¬
to
ment
to
carry
through
its
vast
program of wartime rationing.
cooperation of the banking
with
the
government
is
continuing in the postwar period.
Almost
desk
,
In addition, the
magnificent job which they did
setting up a special system of
banking for handling. ration Cou¬
in
Sny¬ system
vention of the American Bankers
loan
war
This
*An address by Secretary
1946.
for.the fiscal year,
pre redeemed.
est
earned
In addition,
by
funds—which,
amounts
to
inter-f
government
in
the
about
trust*
aggregate,,
$600,000,000—'
represents a noncash transaction. >
a
result of these and other *
As
items,r there will be what
(call
a cash operating
almost $3,000,000,000.
we may
surplus of>
•
;
r
(
v
rowing
bonds
$700,000,- "*
is treated >
as a
budgetary expenditure, but ."
it will actually go to increase the Value of the bonds, and will not ;
be paid out in cash until the bond9
000
offering them'on
the billions of dollars of savings
as
savings
Which amounts to about
bonds, which is manned by., bank counting upon you, bankers to
employees at no cost to "the gov¬ provide"" oui' ' veterans With the
ernment.
In^
Anore money this year than it will
every
for
bank
United
has
States
a
sales
savings
the
war.
You know the magnitude
of the fiscal problems
confront
need
us.
which still
We shall continue to
help in solving these
problems. You know the immense
your
The noncash. items,have; to best
paid 'when due;-1 hut* it'is" helpful>
j
do not involve ;tasli oiiti»
mat
jlays to the public at the present*
tirh'e.
'.
*
-
-v-: ■"*-
•
• ■■
• r
\
of us likes the pro-'*
irpective budget deficit of $l,900ri
;000,000, yet it is a great improve-;
ment over the estimate made last
January.
At that time, the deficit
estimated at $4,500,000,000 fortthis fiscal year. Many of ushad;
was,
hoped that the improvement would"
be
greater. But
a tremendoUa
has
nevertheless
taken'
bankers played in this rapid and place from the deficit of $21,000,-successful reconversion. « If this 1000,000 in the last fiscal year, arid'
war,
:
ilt
,
was
even
iho small{part that the change
.
in
fiscal
1945..
spirit and this performance can $54,000,000,000
cd'ntmue; "it ^Will ease materially Naturally there should be an im¬
the difficult problems that all of provement, for the war, as far as
volume of taxes. I am sure we
the gunfire is concerned, is over.shall continue to need, for a con¬ us still must face.
i want to speak to you today But, frankly, we have actually
siderable period of time, the tax
about two important subjects. One .done much better than most peo~
depositary facilities you. have pro¬
vided us during the war. :;It is a of these is the need for balancing We. expected cpwld be^dohc in the'
[first yea]' after the cessation of
great benefit to the Treasury to the budget, fThe other is pie: pub¬
hostilities.
t,
.
have tax collections paid through lic: debt and the problems of man¬
aging it. These subjects are inter¬ !
You know* it is easy to sit backdeposits in local banks.
Now, as for the terminal leave related and, in fact,.' one common land say thai government expen-.
bonds which will soon be in the policy, should be the rule for both. ditures ought to be cut sharply to"
balance the budget, jIt is muchhands of 13 million veterans of
the war. You know that-there will ^Achieving; A Balanced Budget' iharder,. however,^ to" put', yourri
^In^the^preseht economic en- finger on where the cuts ought
be a
lot
of problems involved>
There are people*."
One of them will concern redemp¬ Viroriment^fbe Federal, Govern¬ ito be made.
tion facilities. We shall "need'your ment. should direct its primary ef¬ unencumbered by the responsibil-help in this connection. We are fort on the fiscal front to achiev¬ lities of office, who blandly say.
ing a balanced budget. Better yet,
difficulties
of
collecting
a
large
-
-
.
.
.
„
.
,
*
it should strive to achieve a sub¬
^reduce^^'government spendingVby?
such
stantial surplus of taxes over ex¬
penditures to apply to debt reduc¬
tion: These are the views I ex¬
and. such ' per
cent rightthe board." They never get
across
very
pressed the first day I entered the
specific about it. But a
butchering job like that would
1
Treasury; and they have the full
support Of the President,
Oreate more troubles than it would,
It
solve.
recently suggested,
no less than two^
was
;for example,, that
Early in August, thq President
j million persons be fired from the[
budget estimates \ Federalx pay rpll^as though
for the fiscal year 1947, estimat¬ jsential government agencies,
released revised
,
es^
and.
ing the budget deficit at $1,900,- {services could be carried on,with-.
000,000.
However,
considering | out personnel. Yet I think it wilt
that there are certain noncash ex¬ \be interesting^ weiosxfe ybuvWheit;
penditures included in the budg¬ \l }tel\-yQu -that 'the-Fedgrdt fGov~*
already
released,
et, the government, in current etrimehf" has
,
Eastman, Dili.on & Co.
Underwriters
.
•
^
;
*
M
,;Y ^
••
4*^ "
NEW YORK
CHICAGO
PHILADELPHIA
LOS ANGELES
■*-
Distributors
^r>"v,V*Vv' <;•*'j'- '•1.''-'ori/;'*V.X-;-.';
^
;v,v-
Dealers
•'V
'
\
v
•
•
vbT^:. f>-
I
,
-1. V,:
-!^
;
\\
*
\
r
,
<
L
r/
V
>(
"
^
t
'
^
\
,1
r\
S
"
PUBLIC UTILITY, RAILROAD
and INDUSTRIAL SECURITIES
W. C.
Langley & Co.
Members New York Stock Exchange
115 Broadway
-
;;
j
-
New York 6, N. Y.
Tel. BArclay 7-8$00
./J-;V.
:!■
iitiSBG:
•'
THE COMMERCIAL
Number 4-532
Volume 164
nearly:'one million civiUah:eihployees < since VJ-rPgy. And, we
&
FINANCIAL CHRONICLE
capacity of our country "securities to meet investors' needs
to produce and ..consume,• sets the
maturity structure almost
;v have done this without increasing
Turning from -, expenditures to. automatically,; ;and has resulted in
unemployment: in
the "land
or
receipts, tax collections .continue a substantial volume of short-term
hurting jithe conduct oj govern¬ to run at - a high level. -As -a -re- securities.
It may be • noted in
ment business. /.It. is worth noting,, sult ;cof Uthe4 rapid rreponwrsta; passhtg vthat the same idea was
from; war to peacetime produc¬ followed
too, for the sake of realism, that
by the British and 'Ca¬
total Federal expenditures for the tion, pur net receipts in this fiscal nadian Governments in their war
-Operation of the Legislative Cand year are estimated at almost $40,- financing.
'
p-Ppi
Judicial
Branches
and-far
ad¬ 000,000,000.
This ds" only about,
On the 'Question of the shortministration
of
the
.Executive $7,-0OO;OOO,O0O less than the peak term
debt,.! wonder if you know
enormous
heavy pay-offs made on maturi¬ importance to our
postwar financ¬
ties of marketable securities each
ing and is vital on the fiscal front
r
.
month.
cate
or/around ,5%
of all
Federal
penditures. We'want, of
••
ex¬
course,
,
to
§SPutelic works is
m
sduricp
Intimated
at
only
are es-:
little
a
:
-V '•"?'
has
*
"V-" A
•'« V'
i»*
K
served^to
-re¬
ithe :-control
months/From February 28 through
forces.
How let's spend a minute on
the
savings bond program.
In my
duced
the
"Treasury
the
public
as
"re¬
debt
by about
result »of the
a
opinion^ this
f
-
.
.
like
tory Loan.
ever. to
ing
do
It
and
is possible, how¬
^day-to-day job sell-
.a
bonds
in .order
extend
to
program is of
savings bonds for their own good.
Savings bond promotion actually
is doing this. Sales this fiscal year
prime
(Continued
on page
3 know you will -agree'.that
should 'be icut .as much
debt,
the 'debt
over
as 'possible in exceptionally pros¬
:year. "'This includes the badly perous times such ;as these; /and,
as
bankers, :you will agree also,;
weeded housing program.' " • <
19,
I think, that it is pure fantasy t if
$ljOOO;OOO}0OO for the present fis-
•
cal
'
■:
|
'Interest
^en
'
^e-^>ebt^^ f moUplain$£^
reduction and
Ohe of the larger areas/of
^gov-
ernment expenditures is that com¬
posed
of
interest
on
the
same
the tax
the fpublic
reduction
debt
-breath.
*.
•
in
_
-j.
fieldirit is tfaeyroleiqf
-
the Treasury. to make
recommen^
refunds of taxes, and ve^
-erans? benefits. Expenditures - for $a£iQtis.y What the taw-is^WiUMeip.
these purposes- are estimated 'at pend upon the action Of Congress.'
$13,000-000,000 this year. This is
Management
Debt,..
<
made up of $5,000,000,000 of in¬
Let 5us turn now to the manage¬
terest Pn the .public debt, $6,200,000,000 of veterans' benefits, and ment of ithepuhlic idebt., I use the'
term in an economic sense, rather
$1,900,000,000
of
tax - refunds.;
There is Little prospect of any sub¬ than/iin a daairow^ta
• 1
-r stantial reduction in these expen¬ sense.
/IThe pUbhcldebt today us so big
ditures since they represent com¬
^ebt,
-
.
mitments
already
made
in
that it
ac¬
•
.
Expenditures for
finance
€00,000.
are
.
at
ment
$4,200,-
expenditures
securities
debts
in
nre. now
banks
are
ities,
For mutual
one
-of
in United States
secur¬
family-owned
or
closely-held corporation., inheritance,
savings bqnks,
gift and similar
a
taxes can ;best be
provided for through Ae sale of/
portion of the outstanding securities and the establishment of a
public markets
Federal securities constitute near¬
ly two-thirds of all assets; and for
wsurance companies, the ratio is
doubt that these are wise outlays almost one-half. For non-financial
about one-half
in the interest of our interna¬ corporations,
of
their liquid assets consists
of Fed¬
tional responsibilities.
eral securities.
Individuals also
hold a targe volume of United
Rational Defense
tal
3a
For ithe
govern¬
per cent of the total
of all insured commercial
assets
recoveries.--^Inteniational;;--^
represents about 10% of to¬
other
Fifty-five
investments for the most part, but
nance
all
their largest asset items.
are
the figure does-not make any al¬
lowance for future
repayments
and
dwarfs
•
investors,' foo^-because
international
estimated
These
.
-
comparison. This debt is of vital'
significance to banks—-and Pther
cordance with Congressional man¬
dates.
i
.
expenditures; and, while this
lot of money, there is no
The/effect is three-fold:»
4
v-
a
i;.
The /money thus .-received
-of securities
be plated in
can
'.diversified list
a
.agains t the time of need.
^Expenditures
States securities
in fact, hold
-estimate for, patitmal twice as
many as all life insur*
./defense for this fiscal-year is $18,- ance
companies and mutual sav¬
5OO;OO0,OOO in a total (budget of ings hanks arrnhined.
$41,500,000,000. The January hud-'
So, it is no wonder that the
get estimate •was about $15;000,-<
management of the public debt in-^ j
€00,000. There are two principal volves
many issues.No wonder
ireasons for the increase.
One of that there are
many ideas as to
these is the payment of terminal
what should be done.^Frank dis¬
leave to 'enlisted men—amounting cussion
of these ideas-r-competito nearly :$2,500;0G0,000—most, of
tidn 'among them; for isurvival-^
which, as I have said, will be paid as a healthy manifestation of the
in :terixiinal ibeave -bonds.
The, democratic process
operation, i.
other amounts to more than $500,4One aspect vt public debt mam
^
CQO;000 for the increase <m !pay of
ugement 'Which is frequently dis^
the armed forces provided for dn
—
The
:v
An established
^market facilitates prompt, action
further public. participation become adrisable to
additional capital requirements vor for other reasons,
mew
-
'
3.
The valuation of estates for
tax purposes
As. underwriters and distributors of sound
;:: '-
•cussed
^legislation ^recently enacted.
The determination of the amount
-
•«or
the necessity of particular
ex-i-i
tion
of
the /debt
by
is prhnarily a function of
the distribution
of ownership—
that is to s^y, securities are tai¬
•
d© want to emphasize that the
'Size of this group of expenditures
t
f singles it out for special attention
in looking for areas in which to
'
oomsiderations must be "secondary
the determination of Our needs
-for national defense:
"... Let
no
me assure you
man
in
this
"
,4
The First Boston
ducing
more
anxious than President Truman
to accomplish the major Objective
of balancing the budget and re¬
4
^
"
'•
V
'h*
»»'*</'!
\! ''
^
We have available
either presentable
on
demand
or
a
financiijgi
surance
banks
more
of
companies
are
and ' savings
not due or callable for
than ten years.
individuals,
more
In the
than
case
'
'
'
'
r"v: * S'Wh
1
<t
'
'
r
'
'fi
t'fi
>
\
1
[yi'r-p 'S
,
,
;;
timely booklet which explainsr our facilities for
husine&s ^xecnli«s upon request.
FIRST BOSTON
CORPORATION
r
-
'
A Merger .aj
{
MELLON SECURITIES CORPORATION
-
...
,
\
THE FIRST BOSTON CORPORATION
two-
which
The President believes our proved so
disastrous to the small
great hope for the future lies in, holder
nf
bonds
after
World
the viitaMty of bur -system of «n- War
I...
-
U',
i-/' :::TheWM
the Federal securities held
-by in¬
cates.
dividual. ^erprise
W '
'
^^ent^to
savings investors, such as Insur¬
ance
companies, savings banks,
Three-fourths -.of
ducing the public debt. This, the; thirds of United States
securities
President feels, can be done with- held .are
savings 'bonds, which
'cuat sacrifice of the forward lookwere designed to avoid
the risks
ing policy he so persistently advo-i •of
market' fluctuations' *
t
the investing public.
iv
NEW YORK
J
.
(underwritten,
Corporation offers unique facilities for intro-
a corporate name to
and individuals.
that there is
country
in the securities
corpora¬
fall due within one year. v
y
-expenditures—keeping in
In contrast, longer-term securi¬
mind, of course, that budgetary, ties
are
designed for long-term
~
largest trading organizations in the United
a
tions, four-fifths of United States
Government security holdings are
veduce
-
States wiA
maturity
classes
penditures does not lie within the
province Of the Treasury Depart> merit.
1 am not in a position to lored
to the needs of the various
cay whether national defense ox+ Investor
classes as much as pos¬
4 penditures could be reduced with-F
sible, yThus; shnrt4eim /securities
/out impairing our national sectuv
go to the banks and to business
ity. 3 certainly want a strong
organizations. Almost half of bank
■i America. 1
certainly do not want holdings of securities are due
or
y to repeat the mistake we made •callable In less
than <o:ne yemr. In
".'after the first World War.
But I the case of nonfinancial
-
of the
one
,r
is facilitated.
has to do with the size of
H the Short-term. debt. The distribu¬
•
as
should'
.satisfy
corporate securities-,
-
and
^
..^Accbrdingly^ *-ihiSf tailoring ^ pf—
CHICAGO
BUEFALO,
-
CUEVEtAND
HARTFORD
■•
-
PROVIDENCE
maintain
the
payroll savings
objective of aid¬ plan and to sell the American
of; inflationary' people on the idea of
investing in
IpZftpemtier
i,
all-out bond selling campaign
the War Loans or the Vic¬
an
to; be (Used .to reduce the public
'but total Federal expenditures for
tnonrmlitary public works
taxes
This
debt
ernment with the
I do not be¬
would be helpful un¬
der present conditions to
promote
.
expenditures are oftdn
Purged 'durjrrg times of i-rffiatiohai^
pressures.* 'This counsel is
/
W-
■
•
reduced
is an example
of
management tied im
to the fiscal
program of the gov¬
ing
the present time.
at
and lieve that it
..
in Which
an area
.
duce
possible, but obviously any cuts
large enough; „fo have any signif¬
icant -effect must come elsewherfe;
'cuts
.
of
-
period.
public
-
the deficit /sharply.
I be-'
$14,000,,000,000
lieve, and I think that the -Con¬
gress and v the
American people'
believe, that for -our common 'good
oitr
present tax levels mbusi be
maintained for some time. This is
inescapable if we are to achieve
a balanced-budget, and a '/surplus
xeduce these expenses as much 'as
^
V
The maintenance ■$&*. the pree«at'
level
indi¬
banks
Banks
holdings of Federal securi¬
ties by about seven-eights of the
total ,debt reduction
during the
the extent of the Treasury's pro¬
of debt: reduction rim recent
gram
Present Taxes to Be, Maintained
commercial
Reserve
their
.
collections reached during the war.
^Preliminary' figures
that
Federal
r
Branch aside from military :arid
Veterans -jacitivities >ig about '$2|,000;000,000 fdr the fiscal year 1947
179S
PITTSBURGH
EHILADEl.PHlA
RUTLAND
SMI TRANCISCO
SPRINGFIELD
WASHINGTON
1818)
j
.
iZlt-
'H£0F;:
WP-t?
.VA10WAM19 i
THE COMMERCIAL & FINANCIAL CHRONICLE
1796
;jicir0.u !4
■.
feTd'i'!
'■ Id
fix iri"w«r. •>4 j
Thursday,-October 10, 1046
1
"v
'
■
f.'-
By W. RANDOLPH BURGESS*
^
Vice-Chairman, National City Bank of New York
Ex-President, American Bankers
of political and economic international
Noting the United States has
t
our "
two
-operation Mr. Burgess calls attention to frustrations of this policy and points
out dependence of economic recovery on permitting revival of individual ini- - "
tiative and enterprise rather than on political action. Sees inflation and res- 3 h:
toration of monetary stability as a great problem of reconstruction, and ^ -y
years,
-
°n^ a
seems
months
that we
few
\
■
'
ago
with
der
our
sons
n
were
|jg|i
German
the
bulge
flB.
A
k
BH B
*1 fl
.
-
■H11 ASH
the
on
1 g i a n-
e
French
and
line,
still
for
listened
•
.
great
of
hope, in which we saw with our
mind's eye a new world in which
evil. had
been
conquered
and
peace would reign. It would be a
world united — "one world."
In
our own
but
we
wicked world,
For¬
know there is none.
tunately/ this
; i
A- ?.
.
time
the
country
as
a
nation to
take
*,
•
V-VJW
.
r'nl-.w""'
o,;?''
'V
#*.
,VP
The Bankers' Special Interest
By reason of his special train¬
ing and point of view, the banker
has inevitably focused his atten¬
tion on certain phases of this great
international movement
In the
war we
our
tions
success
concentrated upon financ¬
the
with
the
buying underwrote
own
vision
was
not
adopted.
It
was,
kept operating smoothly the great
in fact, difficult for the Congress
to do so, because the Executive
Departments had already gone
of the great war loans.
We
essential to
stage was set for a better day for
war.
all mankind.
~
Quietly and little noted by
We are now in the third phase, the public or the press, the banks
ran
the complicated mechanism
a phase of bitter disillusionment.
We look abroad ^ with troubled of handling ration coupons/which
eyes as Yugoslavia shoots down we knew as "ration banking." We
American planes, and in confer¬ did these things understaffed, be¬
cause our people had poured forth
ence after conference the road to
both into the fighting services and
a lasting peace is blocked at every
man
the
prodigious supply
turn.
Meanwhile many countries to
Europe and Asia are flounder¬
ing in an economic morass be¬
they have no recognized
leadership and no sound principles
of government on which economic
ers
*
machinery
far
cause
life
be built.
can
Such
a
change in sentiment in
months makes one
short span of
With the coming of
as
sociation
*An address by
of
the
the
72nd
Mr. Burgess be¬
annual
American
convention
Bankers
Asso¬
ciation, Chicago, 111., Sept. 25,1946.
their
second
on
laying action which
to
The
As¬
was
matter
presented
immediate
came
That
' and
was a
tial-
a
tee has submitted
before
cur
little blind and
written report
a
recommending 1 theproj ect after
careful study of its merits, and
with due regard to the prospects
that
position
The
will
borrower
the
to
be
in
a
his
obligations.
"act
prudently."
meet
is
bank
to
The United States has veto power
over
loan to be financed in
any
this market.
loans,
The bank
can
make
only after it is
assured that borrowing cannot be
done through commercial chan¬
nels
moreover,
under reasonable conditions.
Thus
the
bank
is
organized
borderline
deal with
laboration, a wholesome surge, I
believe, but one that was at the
time
its
membership
and
the
Congress
comprehensive reports and pro¬
posals which were sound and had,.
I believe, substantial Influences <<:
of
Congress at - a i; time when, as I
have said, there was a great surge
of sentiment for international col¬
attention
before
them. as
pressing importance.
year and a half ago.
the means for in¬
laid
major alteration with¬
running the danger of seem¬
ing to repudiate one of the first
and de¬
ternational economic cooperation.
Association
a
international agreements
on plans for national recon¬
version and the care of veterans,
and
agree¬
out
first
This
fore
focused
our
definitive
making
not make
peace) bank¬
individuals and in
in
so
ments, that leaders ih both par¬
ties felt that the Congress could
lines.
of
other
.
This major re¬
cases
to
which
expected to be good loans but
are
which
involve
a
little
too
risk for private lending.
gations of the bank
much
The obli¬
are
guaran¬
teed up to a little over three bil¬
dollars by the United States
lion
uncritical.
Government, and beyond that by
did adopt a number other governments.
Discussions
specific recommendations made are now beginning as to the mar¬
by the American Bankers, AssopU keting of these obligations and
ation which I believe*:wiU rproV$ Changes in laws and regulations
necessary to qualify them for pur¬
chase
by
institutions
or
trust
funds. That is a problem in which
we bankers can be helpful by fa¬
miliarizing
ourselves
with
the
The Congress
of
facts.
Fund,
International
as
we
Monetary
pointed out in; our
testimony
will tread
the
before
on newer
Congress,
and less prov¬
It is likely to encoun¬
ter, among others, the difficulty
that UNRRA is now experiencing
with respect to Yugoslavia, for
with the Fund just as in the case
of UNRRA, the United States puts
its money into a pool under inter¬
national control and may find its
money being
used by countries
pursuing policies we do not like.
The Fund is designed for a dif¬
en
Union securities Corporation
UNDERWRITERS AND DISTRIBUTORS
which
we.
One
find ourselves.
of
Bankers
the
proposals
Association
of
adopted
the Congress was for a
the
by
full peri¬
odical review of the operations of
both Bank and Fund.
Our respon¬
sibility as bankers is, I believe,
first, now that we have these or¬
ganizations, to give our aid to
make them effective, and second,
to
study their operations and be
ready to recommend from time to
time such changes as may be de¬
sirable.
from
most
_
.
BUFFALO
BOSTON
•
CLEVELAND
:.'I);/:,,'."*
Looked
65 BROADWAY. NEW YORK
/
this
,
at
abroadand
range, of course, the
important 'thing about all
was
not the- details of the
but the fact
that the
United States after World War II
HARTFORD?
,
PWWPEWHIA, lVjVl ^SX^QUSE
and
private channels,
hriichVaftd
Whether
present
policies
known
be
not
lent too
carefully enough,
lending too suddenly.
our
generous
we
not
and stopped
even
are
for
more
will
right
some
time
to
come.
Problems of Today
•
Having^ set
our faces steadily
good conscience toward
and with
international
cooperation,
we
Americans find ourselves brought
short. We poured relief money
into Yugoslavia and we receive in
return open hostility.- We shipped
up
billions of dollars worth of lend-
lease goods to Russia, and today
we find
it seemingly impossible
to
reach
setting
agreements with her in
cooperative
- up
interna¬
tional machinery which will help
to keep the peace and aid in
world recovery.
The crucible in which the sub¬
stance. of;, cooperation is being
tried out is Germany, where the
four great powers are in contact
and in the midst of experiments
in working
together.
I visited
Berlin a few weeks ago and found
it a discouraging place from the
view of future success
point of
in international
cooperation. For
example, the Potsdam Agreement
calls for the economic unification
of Germany, a
necessity for
Besides
selves only the British ha
ready to carry out this agreement
self-support.
man
unification.
for
This
is
one
of
matters in which commoncooperation between nations
has; been unnecessarily difficult.
Some progress has been made by
many
sense
and patient ef¬
representatives, but
discouragingly little. Partly as a
consequence,
in the past fiscal
year it cost the United States $200
unremitting
the
forts
of
our
to feed
zone
our
in Ger¬
In other words, instead of
receiving reparations from Ger¬
many.
many, we were in
them.
i
In the face of
effect paying
-
<
this and
other evidences of the
become
would
it
up
hands
one's
sort,
throw-
same
to
easy
in
so many
despair
and
give up the effort. But there is
something else going on in Eu¬
in China, and even
which would be easy to
in Japan,
rope,
but which
Let
me
in the
overlook,
ought to give us hope.
illustrate what I
of France.
case
mean
From the
reports in the papers I had ex¬
pected that France would present
a
fairly hopeless economic pic¬
ture.
The
political
power
in
France
is
divided
between
Communists and Socialists
the
on one
hand, and the clerical party, ihe
the other. The eco¬
nomic policy is, therefore, unde¬
termined and drifting. ; The gen¬
eral report was that the French
people, after their years of en¬
slavement, were drifting also, and
that
the
economic life of the
M. R. P.,- on
country was at a perilously low
-i ■;
ebb.
from
long
machinery
itytyv
through the ExportImport Bank.
While we made
large foreign loans after World
War I ,.through both government
ground.
ferent kind of world from that in
Investment Securities
agencies to relieve distress
loans
million
.
The
In
and destitution and made substan¬
'
/
obligations.
addition,/ we have given away
huge "sums Through UNftRA and
In that
financial
Bretton Woods was approved;
house in order.
}
billion, lend-lease
effort and funds.
States
off from the outside
this hopeful
day the United Na¬
Organization
was
born;
stead
bonds to our customers/ and
United
word
|
victory came
tion,-. in contrast with our action
vto the League of Nations. In¬
?. of
trying to collect: war
debts, we. have cancelled over $40
as
ing the great national offensive.
We sold billions of dollars of war
the
defeatist course.
of relief and
surge
which
might be shut
there were some means by
refused
with : apprehension
Then with double
the
record we find ourselves wishing
this
Y-E Day, we
efforts at international collabora¬
connection, I am moved to be important safeguards, espe¬
to
say
a -word
about* Bretton cially for-the creation of- the -Na-.
Woods.- That was the major issue tional Advisory Council to coordi¬
in bur relation with these prob^ nate' United States foreign lending
lems during the year of my presi¬ policy.
The Bretton Woods ma¬
dency of the Association. >v+ Our chinery,-as adopted, is however,
far
rrfore
cumbersome
and
un¬
position, in brief, was that we ap¬
proved the principles of -economic wieldy and expensive than .was
cooperation sought in the Bretton necessary.
Woods proposals, but we believed
The Bank for
Reconstruction
that as drawn they were unneces¬ and
Development, which we sup¬
sarily
complicated,
impractical, ported, is now getting organized
and expensive.
We proposed and under the able leadership of Eu¬
recommended to the Congress (bat gene
Meyer, and will be in oper¬
instead of two institutions, a Bank
ation/ in a few months. Let me
and a Fund, the whole task could remind
you that the bank is not a
be performed by the International relief
organization.
Its statutes
Bank alone with greater effective¬
provide that it is to make loans
ness and a substantial economy in
only after a competent commit¬
In the .face of this
has
from the Far East.
news
preparedness and diplomacy, and put
,
mentally dizzy.
for
When the tide of vic¬
turned; with
tory
im-
patiently
some
from them.
we
as
waited
W.R. Burgess
;
being
forced back in
institutions, -the British
Financial-Agreement, and in other
co¬
Totalitarianism .aiid Pemocracy^ as handi¬
caps to recovery. Holds this struggle is also apparent in U* S. and
is interfering with world cooperation.
Urges we be strong in our
shud¬
a
as
a program
present struggle between
looked abroad
a
Woods
minds
back less
it is astonishing
how in that brief period your and
my sensations have changed about
the great outr
;
side world. It
Turning
than
i
Association" "
r
In Paris I found that this
apparently not so. ) The
indeed
was
were
divided
politically,
governmental
its
and
uncertain,
was
country
policies
ineffective,
add
discouragingf to >nt^rpf\s$.,,
cooperate
r. pissifoy/n in our
partnership in the Urit2d Nations
Organization,
in
•
the
Bretton
country
tion.
is
suffering from infla¬
Yet the encouraging fact—'
(Continued on page 1810)
•
•'
Volume
164
Number 4532
r»+i
*+*•««
Millions know it and
mark of
The U • S • S Label is familiar
tised year
after
year,
Before the war,
have read of its
ance
■
of quality
This
sales
in the
they
saw
millions of Americans.
widely-read periodicals of the nation.
it
quality steel products in the
on
war
record. And they have
steel, wherever they see it. They look
on
stores
come to
it
as a
any product
regard it
.'
as an
honest
assur¬
friend.
which bears the U • S • S trade-mark,
potential
customers
once
steel
will prefer the "face of
a
returns
in quantity
friend"
to
that of
:
Manufacturers of
.
they patronized. They
friendly attitude of the buying public toward the U * S • S Label will prove a valuable
asset to
Labels
the
They have seen it consistently adver*
stranger.
*
as
quality steel
most
magnificent
the retail shelves. For
to
to
it
trust
•
•
i
are
''
i
'•
j-' I:
-
•
*.
■
'
invited
quality steel products who desire
■
to
'
s
address
^
■
• •
•' n
*'V
inquiries
».
X.*
to
i
*i
"*'■
f-i- •'
*
"j
' '
more
"
'
'
'
'J ^
a
,
information on the use of U • S • S
**'
,
*-
"!*•
'*
;
t!i' »'i <■. ■
..
■
f-
j
"
United States Steel* P. O. Box 236, Pittsburgh, Pa.
''?/ A'
A"/'-,;'.;
_
f
1798
^
;V;j JJJ3J;;
Thursday, October 10; 1946
THE COMMERCIAL & FINANCIAL CHRONICLE
"V
Nationalization
Free
vs
By FRED I. KENT*
Enterprise
>
<
_
•
Director, Bankers Trust Co., New, York
,
Every normal
duce
person Jean
than
more
he
Mr. Kent points to
our material progress as evidence of superiority of private
enterprise under government checks ami balances. Lays blame for waste
pro¬
requires for
the opportu¬
consumption given
nity. Some 300 years ago in this
country there
\j
during
disruption in balance of the three departments of our gov¬
tt
to "the cracking-up of power of Congress in the *30's.
Holds unwise extension of government activities hampers reconyer
sionand is fostering ^nationalization. *
makes available people's coml»ned intelligence and creates checks
and balances through independent individual action.
Contrastsconditions under nationalization and free enterprise and de- ;
in Mas¬
areas
sachusetts and
•
Vir g i n i a
where
prop¬
rights
erty
not
were
recog n i z
Therefore,
e
incentive
in¬
due
ex¬
isted
war on
ernment
certain
■were
to
duce
it is the. acts of
determine
their
men
which
ri
than
Life
the;
makes
-Must
Have Checks on
Administrative Powers
d.
serious
The
JiJ
great and all-conclu¬
against nationaliza¬
tion,. regardless of other factors,,
YY;'!
effect
•
•
sive
J.-Y
United Statesman be seen
with;
for
other
cheaper
processes
2
reason'
Under
:y Nationalization
—
Cost
is that which led to the formation-
the
during
upon
dull
Regulation-—Com¬
enterprises
of
production, for variation in styles,
for improvements in serviceabil¬
ity, and for more useful gadgets
and greater production.
petition
The first
and the balancing
judicial department
powers,
of
had not beer*, destroyed.
he
s u m e
cratic
force
movements.
produce
more
Under Private Enterprise With
Government
picts the "American way."
and
anyone
to
co
d.
no
quently, there is no incentive to
produce: (a) better goods,; (b)
cheaper goods, (c) new styles, (d)
goods of greater utility, (e) goods
that
meet
buyers'
desires,
(f)
goods at lowering prices, (g) in¬
creasing volume.
'
*-!"
of our, Constitution
been
of goods, produced under bureauc- i
that has just racies must be and always is
discussed;
History has proved beyond de¬ the years of peace that prevailed
greater than* under private enter¬
As.
man.
Is,
constituted, "the prise* as. elimination of profit is
that the longest periods of between 1933 and 1939 when the
mere
existgreatest accomplishment and* com¬ more than offset as time goes on
progress, exclusive of upsets from war started .in
Europe, throughout
ence, and progress toward better outside
sources,
have - occurred the war period from 1939; to X-Jl fort, for the human race demands by ; static: devetepment^' and red
living did not prevail, \
when the J systems under which Day in 1945, and during; the time that there, be checks! upon his
tap^"
Then property rights were es¬
power in government in business,
men; have governed themselves since V-J Day up to the present
Und^r Private Enterprise With
tablished in those areas, and im¬ or have been
in industry, and in his social! life.
governed by others when we should have had peace
Government Regulation—Cost of
mediately the whole picture have provided checks against the but
instead, even in otir, own
goods tends X downward to meet
Advantages of Private Industry
changed. There was great incen¬ excesses that men are led into
country, have been faced ; with
competition and buyers' pockettive to produce as surpluses could when
.' Private industry under proper
\they are: entrusted jwith bitter internal war.
books.
.y
'
be saved and utilized to better
government regulations provides,
powers j Ihat,
if > not; jcoiitrolled,
The
3
depression of the 1930's
the conditions "of living and in¬ vitiate
•..,Y;such checks.
Nationalization de¬
and then terminate pro¬
was aggravated and extended, by
Under Nationalization—Buyers
crease contentment and happiness.
stroys them. Then man must de¬
gress for a period/ During times unwise
government activities that
The mental inertia of the people
pend upon the ability of a few can only obtain what is produced
when there have been effective
could not have prevailed if the*
was replaced! by constructive ac¬
'for his needs instead' of upon the for them by the will and < whims
checks upon the over-expansion
Congress, the executive depart¬
tivity and all benefited!, even the of the efforts of men to control
combined intelligence of all the of government men. Management
ment, and the judicial branches
ne'er-do-well.
people, and he is subject to the can develop static production that
ethers,, successful continuing prog¬ of the
government had functioned unrestrained motives of his rulers buyers must take or leave.
Then, after the Revolutionary ress has been possible for im¬
Constitutionally. During the war for his social existence.
"War came the Constitution and
Under Private Enterprise With
portant periods.
.
the excessive destruction of the
the BUI of Rights, which put, into
Under private enterprise; " men Government Regulation — Indus¬
It was because history so clearly wealth of the country need not
form the principles upon which
showed this to be true that our have occurred, and enormous sav¬ can proceed iii the development try must take note of buyers' de¬
the American people were to build
forefathers who drew up. the Con¬ ings could' have been made with¬ of business, banking, and industry sires in order to hold their mar¬
their nation. Freedom of enter¬
Management for its own
stitution of the United States and out interference with the marvel¬ through the exercise of the full kets,
prise now grew
in leaps, and. the Bill of
benefit must Strive to the full ex¬
Rights set up our proc¬ ous production job which was force of the ability that lies with¬
bounds, and the amazing picture esses of
tent of its ability to meet buyers*
government so that there carried out by American industry. in their individuality except that
of a prosperous nation was placed
wants at the least possible cost
would be checks upon those en¬
Further, since V-J Day recon¬ they must recognize the rights of
before the world by the develop¬
all.
The po^er to require such in the best products.,
trusted with the welfare of the version could have
#
proceeded at
ments
of the
United States of
people. To accomplish this, they an
amazing speed that * would recognition lies with government
4
America. A few references only
separated the legislative, judicial, have enabled recovery from the and can be provided through wise
are needed to show what a people
Under Nationalization
Where
and just laws.
and administrative powers of gov¬ effects of the
The combination,
physical losses of
living under the freedoms; thus
ernment in such a manner as to the war to
therefore, of private enterprise deficits in production occur, buy¬
established
take^ place jvjdth such
can; accomplish j to¬
prevent the runaway of any one rapidity that the physical hard¬ and government regulation Is ers pay for what they buy, but
ward building an
effective na¬
all taxpayers help pay the cost
branch
of
government
through ships of the people would have necessary to the protection of the
tional life.i
whether they are buyers of the
the assumption of powers which
disappeared like mist before the people.
Of our
130r-odd
million
peo¬
Nationalization of business and particular goods or not.
There¬
could not be controlled by the .wind.
In fact, the correction of
ple, 71 millions hold life insurance
others.
*
/",
*
these physical conditions would industry affords the people no fore, taxpayers make part pay¬
policies., There are 50.4 million
ment of goods produced for others
As long as the people insisted have moved forward with such such protection;! :Neithdr does it
savings depositors and 15 million
make available to them the indi¬ that they may not desire or re*
people who hold shares of stock, upon our government living up growing force that it could have
vidual forces that arise from the quire or that they cannot afford.
to the Constitution, they were af¬ allayed much of the mental unrest
savings depositors and 15 millions
intelligence of the multitude of Taxpayers have no option and
the
greatest
protection that is still so violent throughout
of people who hold shares of stock. forded
must pay their share.
governmental" abuses that the world because of the powerful persons who constitute the nation.
All of these interests arose from from
Under
nationalization,
men
in
Under ..Private Enterprise With
has ever been devised. This is moral position the United States
savings made by the people that
government itself determine how Government Regulation — Buyers
'
directly and indirectly have built' more clearly seen when we apply might have had.
they
shall
run
the industries. of goods pay for what they buy,
it to what has happened in this
up
our
great banks, businesses,
There is no check upon those in and they determine what they
:'Nationalization Movement
country since 1933. > The tremen¬
and industries.
'
V
government of the same nature will! buy based Yon their desires
dous deterioration of sound* gov¬
Hampering Recovery
Then
there
are
other
things ernment
that government can exercise up¬ and needs and their income.
All
processes that has pre¬
The destructive forma of gov¬
which help to tell the story of
on private
industry for the pro¬ citizens have the option of decid¬
vailed since that time can be defi¬ ernment that are now
hampering
what the American people have
tection of the people.
In both ing as to whether they buy certain
nitely traced to the moment when recovery in- all of the; Ywar-tor ri
built for themselves. In-1900,' X *
Congress abandoned - its. responsi¬ nations need not have, prevailed cases, men play the parts allotted goods or hot,; regardless of the.
250,000 families in the- United
Under private Y industry, business success of producers.
bilities in large part as the legisla¬ because they are clearly the re¬ them.
States had telephones. .In 1945their judgments must be good on
tive power of the. country to the
sult of physical hardships that
46, there were 27,867,000 families
a high average or they will be
executive branch, of the govern¬
have led peoples where great de¬
which had telephones. Continuing
Under Nationalization —-• Man*
Stockholders- must
ment, which further resulted in struction has taken place to turn superseded.
to speak strictly from the stand¬
receive profits as they constitute agement
cap remain when incom¬
destroying, the independence of from the > slow-sure method s'of
point of families in the,make-up
an income- upon which they live
petent. There are no-stockholders
the Judicial arm of the govern^
of our people, 8,000,000 had auto¬
recovery Open to them tq the 'Conto -intervene to require reorgan¬
or expand their business.
ment..
fusion and! chaos certain .to •fojlqw;
mobiles in 1900 and 25,600,000 in
Air;topugh;bus$ess structures ization. Poetical forces ignore in¬
-Even during- the war, a time the inauguration of methods ? of
1945-46. Of radios, in 1922; 60,000
efficiency in high /degree.
families had them and at present when quick decisions had, to be government proced.ure under whether/ they may, be banking,
Under Private Enterprise With
made that were very far-reaching which the people sell theirrffee-; '.industrial, or others; checks; are
30,500,000, nearly a quarter of the
GovernmentY Regulation — Man¬
population of the United States. In in their effect upon the people, dom for false promises of quick provided to control inefficiency
and dishonesty; or lack of ability, agement can only last while suc¬
there was such a disruption in recovery along
lines that have
1926, 4,000,000 families had vacu¬
If incompetent, it must
and all of these checks are super- cessful.
the proper balance of.
um
the three always failed and always; will
cleaners; in 1946, 18,700,000.
checked by government which, be superseded. - Stockholders are
functions of our government that fail.
In
YJ ■'' * .J JJjrn'
1926, 2,900,000 families had
/
through laws that it has the power not satisfied without income.
electric washing machines, and in enormous waste in the wealth of
was
and
drab,
Fred
j a
I.
,
Kent
.,
^...
-
•
nial
v,._.
•
.
s
.
,.
.
.
.
,
,
.
It is due to such -causes that the
1946,
17,217,000.
In
families had electric
in
1946, 19,720,000.
192T, ,6.0,000 the country occurred.. This: could
have
been
prevented
without
refrigerators;
jeopardizing our war effort, and
J
In 1925 the average radi<> cost if it had been prevented, would
$200; in 1939, $35. In 1923 the cost unquestionably have made Such
of an automobile was $2,100 that effort more effective.
This un¬
in 1939 could be had for $800. Re¬ fortunate development was due to
the cracking-up of the power of
frigerators which cost $260 in
1923 were $150 in 1939.
Congress during the 1930's.
Then
It
is
with
came
men
all
of
war.
who
are
these
concerned
developments,
Effects of Congressional Weakness
The
terrible
country, and
*An address by Mr, Kent before
the
Savings
Division
of
the
Association
Bankers
72nd Annual Convention,
Sept. 23, 1846.
i i
Figures .from
tional
Industri
for nationalization of bank¬
Chicago,
reports of
a
I
Na¬
Conference
Board.
to
results
to
our
people that
has
spread
and ;;many
ing
and
industry
throughout
Europe
other countries of
tionalization
.
thej^rid^]^,-
is favore# ,by/ those
who. wish to obtain the-power for
,
government that lies in such
trol
of
con¬
industry.
Further, it is
by those who are in¬
to be envious or. jealous
advocated
clined
,
American
urge
of entrepreneurs- and have so lit¬
tle
understanding, of business and
followed the destruction of Con¬
industrial processed that they can
not see the fallacy of striving to
stitutional processes by our gov¬
ernment could not have occurred
if
Congress had insisted upon
the
our
,
operate
them
in the
are
of
by
bureaucracies;
positive reasons why
to the people under
controlling legislation, the execu¬ protection
tive department had been pro¬ the
nationalization
hibited
interest
people
There
through such position of can not be as great
Congress from assuming auto- vate enterprise.-
of
as
to^
provide;
canv
6
Under Nationalization—Produc¬
■government j is not competent to tion is on the basis of layers of
create laws effective for this pur¬ authority,' but such authority is
pose,! iit certainly should not be largely of the negative type and
entrusted 'with the operation of must be so because of politics. By
the industries on which the peo¬ the' "negative type" is meant that
ple depend for their very exist¬ authority to make changes in
methods of procedure or in meet¬
ence..
-V.;.YyY;;Yy;Y'
ing emergencies does not exist ex¬
Nationalization vs. Private!
cept in the form of prohibitions:,
Enterprise
that can only be released by au¬
It would seem well here
to
thorities in higher layers, which
make a direct comparison of some
may have to proceed before re¬
of the conditions that follow pro¬
lease to the top layer.
Those in
duction under nationalization and
the top layer are political ap¬
under private enterprise, even at
pointees.
They
measure
their
the expense of some repetition,
answers! by political atmospheres..
.
i
industry
under., pri¬
under Iheiij .ad¬
ministration,: furm^^ such pro¬
tection as the people require; If
.Under
petition
;
j
Nationalization
does
-
—
not"f exist;
Com
.
Under Private Enterprise With
conse¬ !;& »-Y,
(Continued
on page,
1807)
:. .:;
Volume 164
Number 4532
JTHE COMMERCIAL' & FINANCIAL CHRONICLE
m'aiw
^vWa■•;■'''■
/<
e*/;.
.
'''iii,'
'
^
/j
'-■•
'y/K.'
'
'■■i'.-.i
X
,.*>
■]
isppfe
r«
.>(»«fj
| ooated on the campus of^theiCletiison
L^^gricxilturat College aijCJ&n^^
Carolitia, stands "Fort; Hill,S theplantation1
home of the celebrated John .Caldwell Cab
^houn; Senator Secretary? of W^ Secretary
of State and
^Statestmder
■
^
yice^PresidehfcoR the llnlted
administrations;
two
•„;
The.: estate originally comprised
;
some
eleven hundred acresln the foothills of the
Blue
Ridge MountainsrWheri Mr. Calhoun
purchased it in -1825/ he <made .some very
extensive alterations
Among these
are
porches which
to
the main structure.
the columns
are an
on
the three
outstanding feature
of the house, for they are
constructed of
brick covered with plaster. An interesting
tale in connection with the size of the
sion relates that it is
Mrs. Calhoun added
husband left for
an
The inain house
due
to
a room
man¬
the fact that
each time her
extended business trip.
at
Fort Hill
was con-
NEW
The Duncan Phyfe furniture of the dining
room
EIRE
.
•
AUTOMOBILE
YORK
•
V
MARINE
INSURANCE
*
"•Thursday,' Octob^f^ 10,
THE COMMERCIAL & FINANCIAL CHRONICLE
Banks and Small Business
A
x,'
•;
■'
1946
1
;V
By ROBERT M. HANES*
Chairman,
Small
Business
Commission,
Credit
ABA
:
;
;-v,;:
/./'•
"v
_
President, Wachovia Bank & Trust Co., Winston-Salem, N. C.
Prominent banker recounts activities of ABA Small Business Credit Commission
The dynamic drive which is the
outstanding characteristic of our
country arises out of the thousands
of institutions of all sizes which in
the
which
•
| and preventing creation of small business credit
aggregate
loans made
by banks to small business
make up what
we
call
A
e r
m
Way
of
Life.
and
large,
only
guarantee not
small
are
to
found in every
field of activ¬
ity
in
gion,
these
in reli¬
—
edu¬
fishing, in
banking,in
agriculture, in
of
'
:
'
from
ryf-'-y
small firms be¬
larger ones.
On the other
the
field :of activity. Com¬
petent management is ;mbst often
the determining factor in the life
World War II
/
proved again the
American Way.
the
of
Tfee military materials and serv¬
ices which this
in such
country produced
astounding
an
manner re¬
sulted from small and large units
working together, to the end that
our
allies were helped and our
enemies
tutions
defeated.
were
All
insti¬
our
enrolled in the
nation
a
has
work
great in
/
"
:
in
the
last decade
have
politicians seriously ;tried to
a political is¬
serv¬
ice
of
the
nation
churches,
schools, colleges, the press, agri¬
culture, business and banks,
Small
,
not
do
dray other
validity
team
Politics and Small Business
j Only
sue.
coun¬
organization;
bank¬
years
make small business
institutions, whether they be in
education, banking, business, or in
an
or
produce goods and
This
possible
some
try. In America, size alone neither
makes nor breaks the standing of
off
removed
guarantee
and great in peace.
war
k
important part in the social
of
other to
made
:
BtflHud, some small organizations re¬
main small.;; But they still play
life
other
Through the
services.
Over the years
economic
the
on
government
each
*lormance.
and
doing f a
ing has served small business and
small farmers.
They have helped
The Ameri¬
size. He ad¬
mires
any
organization, which
achieves :• progress
through per-.
their
and
hand
is not awed by
may
banks
on their own re¬
sponsibility, free from undue gov¬
ernment competition on the one
offer.;
they
can
as we can
banking business
products or serv¬
ices
long
as
these
Respect and profit alike subsidy.
these institutions, not be¬
of worthwhile
come
measure
urider
sponsorship, r Each
government
ownership
maintain
of their size but by reason
cause
credit ; gadget
some
continue to be free from govern¬
M. Hane»
xv;V-,'
identity of its own when it ren¬
ders a distinctive service to the
to
the
corporations
In the
300 pieces of leg¬
government capital.
cally owned and controlled. It will
-
pervades them all, gives zest and
vitality to all their activities. Each
achieves a kind of personality or
come
$1,680!
with
We have large branch last decade some
have "been
introduced
banking systems too, but Ameri- islation
can,
banking r^iU/'rests. on thet aboutvsmall Tmsfness
most <?f
foundation of the small bank lo¬ them having to do with setting up
Harris Si Ewirs
Robert
competition
public.
small business credit
ment
Vopyrigrucu
busi¬
spirit
A
ness.
now
and
owned
business
and
politics
mix.; Responsible
small
businessmen's organizations know
this..,-They have resisted the "dogood" politicians. U These organ¬
'have:. time £ v and
izations
again
called on government to maintain
fairness; in the administration of
the
laws
governing competition
and monopolies.
They know that
special favors from government
must
eventually be
paid .for
by
loss of the control of the manage¬
ment
their
of
business
units.
I
In
most
economic
by
a
other
few large
tions
and
America.
are
dominated
business
banks.
Our
their
countries
systems
institu¬
/Not.
economic
in
so
.
life
is
still predominantly made up of the
small
unit.
There
are
3,000,000
business units in this country, 90%
of which are small businesses.
In
nearly all foreign countries bank¬
ing;
consists
with
of
few large banks
a
branches.
many
Some
of
address
business 'wants
tions
Conv^+ion
off American Bankers
Association,
Chicago, 111., Sept. 25, 19*6.
its
credit
Small
institu¬
be
to
competitive, service¬
able, and free from government
ownership.
Neither does it want
monopoly in the suppliers of goods
and materials.
Furthermore, it is
against monopoly in labor — a
monopoly where a few so-called
leaders
who
seem
to
be
the reaches of the law
beyond
can
make
break the flow of goods.
In
spite
views
ness,
on
of
the
these
expressed
part of small busi¬
bills began to
appear
gress about 10 years ago
in Con¬
to create
trine quite so
it might be obtained.
Again, I con¬
gratulate the responsible voice of
small business as they have op¬
posed these measures one after
the other*.
of
Most
,'7
f
the
'
„..
'
> /
.r
politicians
being
were
and
industry
their own
served in
,
The
then
who
bill
with
dealing
which
died in
we
pany's
more
of
organization,
than
1
premium
During
the
it
has
received
billion 430 million dollars
and
annuity
same
period,
payments.
dividend
The
to
its
banks
ing too much credit and
cused of
bringing
sion by virtue of
were
they
some
were
money..''
■y;■"y/;
of
Many
these
proposals ' for
credit agencies
laughed out of the court of
government
new
were
public opinion because they were
ludicrous;
;
politicians
said to be too
niggardly.-In fact, they were even
accused of creating unemployment
because they did not lend enough
Others
only
ceived favorable comment.
re¬
A few
reached the stage of Congression¬
al hearings.. / :
During this period the Ameri¬
Bankers
can
Association
cluded that the
flow
only
way
con¬
to stop
unfounded
of
criticism
available
the facts
make
to
about bank credit and small busi¬
it existed in the 30's.
ness as
over
period of two years.
were
requested
on
a
ports
At
Re¬
production,
facts
lending every six
during that time.; Such
had
sembled.;
never
before
been
as¬
The
results spoke for
They revealed that
these 5,000 banks, or about onethemselves.
third of all the
banks, were mak¬
ing about 24 million loans a year
aggregating $39 billion, and that
the average size of the business
loan
was
$1,680.
Twenty-four
million loans of an average size of
-
-
Company has therefore returned
policyholders,
as
diyidends, 18%
of all premium income received
real
This
not
high degree of trusteeship
ed 260 million dollars.
of
company
as
on
means
well,
a
the part
management.
Boston
of
■
XX.
FIRST
•
Manpower,
and finance became
LIFE
INSURANCE
COMPANY
CHARTERED
IN
AMERICA—1835
a
own x
con¬
resolution
of
'
the
To give ef¬
spirit of this resolution,! '
Executive Council
later
'
sev-
the
created
Small Business Credit Commission $
which promptly evolved an
J§0
mm
propriate program of action.
Small Business Credit Commission
This
commission,. consisting of
realizing their duty im¬
mediately set about to meet their
30
responsibilities in credit for war
production.
Then an interesting
kinds
of
to the
•
following objectives:
legislative event took place.
The
politicians who had failed to es¬
their government banks
tablish
for
small
business
credit
few
a
took the old bill
down from the shelf, dusted it off,
before
years
members
from
sections of
all
v
the-country and from all sizes and/
itself
addressed
banks,
1.; To help banks convert from
lending procedures to
wartime
peacetime production loans.
2.
To stimulate the organiza- '
: >
tion of small business departments
,;
large banks not already operr* \
it,
a ting such departments.■ *
.1; / »
and gave their gadget a new title.
3.
To revitalize the correspond' ; Wrf..
They called their revised product
dent banking system for peacetime "M,;'
"The Smaller War Plants Corpor¬
purposes,
v;; >.
-;
1
mm^A
ation."
The bill passed without
HA.
To assist banks with plans
opposition. Th^ ABA did not op¬
by means of which they might,
pose it.
We accepted it as a war
while the war was still on, deter¬
measure.
But we insisted that it
mine what were the prospective
a
few
war
features
to
y
in
,
t
.
have
a
limited life and that in
should it continue
case
end of the
war.
no
beyond the
needs of
with
nesses
1
first
At
run
many
while
this
corporation
was
loans, it did a good job for a
in
helping a number of
plants secure war contracts.
Dur¬
ing these early years of the cor¬
poration it was managed by men
who knew%business, finance, and
production problems. As the war
progressed to a point where it was
certain that the Allies would win,
the inevitable happened to this
government bank.
It fell into the
last
chairman
;
of the
poration was an ex-Congressman
who had been defeated in election
"lame
his district. Thus,
duck"
took
over
the
and
new
businesses which
5.
To
assist
in
the
participate in the making of loans ?
banks or to-
V
made by individual
gether with their correspondents.
6.
To keep in touch with de¬
velopments in
Washington re¬
garding the interests of small
business.
All
in
V'.
material
'
V
H';[M
emanating from
urged that banks
considering loans put the
acvr":
to \the end
firm, large or
small, of character and capacity,
might get bank credit to facilitate
the production of peacetime goods
that
on
any
competence
man
or
''
and services.
.iv\y.
:/■
Work of the Commission
Since its organization the mem¬
of
the
commission
He did not condemn
banks.
In fact he praised them
for what they had done for small
business during the war.
He said,
bers
visited every section
have
worked
diligently, carrying out
the mandates of the ABA. Repre¬
sentatives of the commission have
of the
coun¬
try twice in the past 30 months.
the demand for credit on the
State bankers associations and the
would be so
great the banks would not be able
Association of Reserve City Bank¬
Therefore, he
At the suggestion of the commis¬
to do the
job alone.
they
assistance
which
of
,
.should
this
>
have
the
corporation
would; take oyer a. major
ers
have
cooperated in every
sion- many
;city,
way.
correspondent
.v
banks have held meetings of their;
; ;
(Continued on page. 1812)
'X"
■
i(
;=/
f
wm
$
•
commission
the
management of the Smaller War
Plants
Corporation.
Then
our
troubles began.
He used a new
technique.
formation
of local credit groups which would
cent
cor¬
communities both
might be in prospect of forming.
While it did not make
well.
their
respect to established busi¬
;
.
,
prgued,
LL Li
MUTUAL
our
annual
economy.
eraly months
,
part of small business
George Willard Smith, President
THE
1943
ABA,
*
-
St¥
of
weapons
in
best'- interests
the
fect to the
bankers
came,
Co.
and
the ABA
they
/
new
however, the war would soon be
over
and that when that time
only
mutuality, but reflects,
payments to policyholders have exceed¬
during
At the
American
the watchwords of the hour. The
the
amount of bank
months
War Years
r- -
technique in attack,
defense
of commercial loans,
characterizing such guaran¬
tees as not only unnecessary but
contrary to sound financial policy
Then came the war*
added
-
as*
have been since that time.
,
by
scorn
because
services
>
were
guarantees
free from criticism
so
of theiT lending
sion of bank credit;; But by 1936
and 1937 banks were held up to
public
been
never
on the depres¬
the over-exten¬
,
before
and
capital out of such criticism in the
light of the facts.
Banks have
ac¬
No doc-
ever
uance
not
had been condemned for extend¬
new
and
banking
adopted opposing the contin¬
into peace time of wartime
was
these
were
life insurance
its business life.
1 *
chartered
bureaucrats
vention of the
committee.
bills said that The press changed its editorial
doing a job in ex¬ policy from one of criticism to one
tending credit.; A wave of criti¬ of praise.
Politicians quit con¬
cism developed against banks; and demning banks on account of their
their credit practices 10 years ago.3 credit practices.
They concluded
Only a few years before that they that they could make no political
sponsored
a
behalf.
were
silly had
the
offense
the
of
permit
had to evolve
we
v
;
and
Since
using
What Happened?
the ; risks
business
local communities.
this
century-plus since this Com¬
ex¬
been enunciated.
business
by the people of
the
man¬
perience losses if it is entitled to
banks to take the profits.
how
The
In
to
rec¬
hands of bureaucrats.-
what mutuality means in
Competent
system.
agement knows it will have to
told
great expense these facts were se¬
cured from five thousand banks
monopoly.
no
loss system as well as a
cqmmittees of Congress by repre¬ profit; however*
in ♦Hhe ^latter^1
sentatives of both small banks and stages of the war the gospel was
large banks who not only gave preached that Uncle Sam could as¬
which
ment
credit
profit
does
right to
right to live.
no
ords of their own institutions and
the
is
of
care
a
has
the terms and conditions by
against mo¬
nopoly in the field of credit. Es¬
pecially is it opposed to govern¬
by Mr. Hanes be¬
fore the 72nd Annual
business
Ours is
• ■
,
risks
profit and hence
that
which
enterprise
assume
sume ;
other
was
or
*An
1
-
Small
Private
not
presented
were
not to
was
but who also contributed the
—
credit
facts
,
.
praised him for
policy
Congress the picture of what was
being done by banking as a whole
tried to outdo the
its
or¬
ganizations for their courage and
foresight because they have con¬
sistently refused to be persuaded
by the sugar - coated words of
those politicians who have offered
them pity and easy government
These
'
His
'
Many
eventually.
taking
small business.
stand.
He did not
He loved us.
us.
kick the life out of us, but to hug
us to death.
Either way you die-
demonstrated
were
dealing with banks.
his
tech-
new
a
generosity with respect to
the amount of money offered and
in
so
commend these small business
new
That
banks
was
editorial writers
.
loose lending but threatens con¬
Lists reasons for opposition
government guaranteed loans.
trolled.
cation, in pub-
general
state
the part of bureaucracy
on
condemn
banks.
con¬
have
systems
foreign
become
Here
in
encourages
of private
tinuation
profits.
nique
government credit
is needed and attacks Reconstruction Finance Corporation for
instituting its 75% automatic guarantee of loans.
Points out such
can
These institu-'
tfions,
no
banks have the lion's share of the
Cites volume of
agency.
evidence
as
portion of all the risks and let the
political issue
a
agency
the
i
primarily to combat making small business
set up
was
;
.:
,
Volume 164
1
•
.THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4532*
*
1M AG IN ATI O Wjl S
1801
THE PI R E CTIH G FORCE AT CHRYSLER CORPORATION
/AtA6fflAT/0N*°mmFACT0Ry
TO
HELP
the
E
PASSING MARK IS 100!
This
picture shows you something new—
testing of automobile engines to
make sure that every one will give topquality performance.
electronic
Here, each completed engine is hooked
"automatic driver." This is an
that automatically runs
engine at a number of different speeds
up to an
electronic device
the
and with various loads.
engine's performance—in 14 different ways
—with the required high standards. Noth¬
ing less than 100% performance can get
by these precise electronic controls!
This electronic
testing grew out of meth¬
production engineers had devel¬
oped and later applied in building giant
engines for Superfortresses. They combined
the proved superiority of these methods
with new ideas for
testing car engines—'
and this unique device (shown here in the
Dodge car factory) is the result.
;
ods
our
,
Plymouth DODGE
PRODUCTS
Airtemp Heating, Cooling, Refrigeration
»
Chryiler Marine-& Industrial Engines
OF
•
BETTER
MAKE
CARS
automatic driver
FOR YOU
test assures car
that every new
Dodge engine is
proved for the full power, performance and
economy for which it was designed. It is
another example of how creative imaginalion, plus "engineered production," adds to
the value of our products.
owners
That
helped
same
practical imagination has
pioneer many of the most im
portant car improvements of the past
years. You'll see its latest achievements in
the
us
most
advanced
cars
of all—the
new
Plymouth, Dodge, De Soto and
He&ota
CHRYSLER
Dodge Job-Rated Trucks
-
•
-V,-./.
CORPORATION
Oilite Powdered Metal Products •
•
Cycloweld Products
.
•
Mopar Parts & Accessories
THE COMMERCIAL & FINANCIAL CHRONICLE
•
1802
Thursday, October 10; T946>
Capitalism-Its Promise and Problems
HOFFMAN *
By PAUL
President,
■
Studebaker 'Corporation
:
Chairman, Committee for Economic Development
holds
the
ther action to
all
for
here
us
that
next
the
of a
century is vi-
J j
brant with
you
and
too
optimistic
I
Hoffman
G.
Paul
early part of 1942 the Committee
Economic Development
de¬
clared in a booklet entitled "Tar¬
also
tle
and
the world has
predict that it can
within
the
next
known. I
ever
doubled
be
acclaimed the setting of
goal, but in a surprising num¬
general
that
twenty-five years under our free
capitalistic
ber of instances the CED was sub¬
,
would
reached
be
prove
more,
same
a
tremendous
other
embarrassment to business in the
*An
world.
address
Sept.
to
give
unfaltering and enthusiastic sup¬
port to the United Nations Organ¬
ization,
Association,
23,
dare
system.
Other than to urge that we
Convention of
Bankers
Chicago, 111.,
are
Hoffman
Mr.
by
before the Annual
American
there
Today
would
collectivist
make for his
postwar
Further¬
I am certain that in that
period we can realize the
age-old dream of abolishing pov¬
erty.; These are predictions that
neither Uncle Joe Stalin nor any
and, therefore,
to be
the
provided
system
world remains at peace.
scathing criticism for
a
fantastic
objective
which, its critics predicted, could,
jected to
setting
never
highest
the
them
for
standard of living
in
Business
is pro¬
of today our system
as
ducing
if we were
unemployment, but
attainable.
the lit¬
merchant, the office worker,
the small farmer. We know
that
necessary
was
eco¬
an
man—the factory worker,
get for Peace" that a postwar gqal
of from 53 to 56 million jobs not
mass
of
I
do
not
propose
this
afternoon; to discuss the problems
1946.
self
to
maintaining
~
the
to
capitalistic
system
v
be main¬
can
produced
ica
view
and
in
it may seem
that
gest
if
taken
win
people of
hands
do not
country
a
vote.
rect
they
Instead,
its
it
But
was
first
a
step
di¬
ism.
is
It
ocratic
us
of
anemic
Called Bonds & Pfd. Stocks
form
To
could
frontal
flank
or
have
(
120
york
BROADWAY,
stock
NEW
exchange
YORK
5,
Wire
Systems:
Bros.
-
Day,
Hartford
-
Stoddard
Springfield
&
—
Lockwood, Peck & Co. -Baltimore
White & Co.
-
St.
Williams,
Inc.
New
-
Y.
—
Louis
Haven
& Co.
*
Hendricks & Eastwood
—
Sincere &
Co.
-
-
more
peopled
—
As
Tifft
Boston
-
——
Philadelphia
of
we
two
1.
v
more
of
our
-Why has
namic?
look at the broad picture
capitalism,
we
find
major, natural characteristics
Our
out:
cost
has
economy
conflict
of
that
about
to
find
people
job
of
work
been
dy-
KIDDER, PEABODY
FOUNDED 1865
;
CO;
~
'
■<
.
"
'*
;
be
coth
about
their
future,,
have them fearful.*Our
American system has traditionally
rich
rewards
hard
for
work and creative thinking. It has
NEW YORK
-
'BOSTON
PHILADELPHIA
CHICAGO
imposed
reasonable
penalties
NEW
•
PROVIDENCE
BEDFORD
t
NEWPORT
SPRINGFIELD
why it has been dynamic.
That's
;
r
SCRANTON
BALTIMORE
LOWELL
Of
_
4
READING
course,
Wards
we
have
used
re-
and
penalties most effec¬
tively in the field of' private en¬
terprise.
owned
public
their
into
way
the
promise of
a
a rea¬
chances
profit
are
dreary, they are
put off e,Ven though ample
often
cash
reserves/are
problem
of
hand.
on
market
dual problem:
a
The
demand
is
There must
be
the power to purchase and a
willingness to spend, before we
can; have
adequate market de¬
mand.
If
we
strength
are
of
,
right,
then
democratic
our
the
cap¬
,
italism
lies
vitality;
herent
its . weakness is
tendency toward
uncon¬
trolled
fluctuations.
There¬
fore, it is
hance
<
up
which
ures
its
in
its
natural
lusty
its
in¬
it'
to us to adopt meas¬
will protect and en¬
dyndmism" and
mini-
mize its instability. Some of these
measures
All
that
them
already
are
is
necessary
applied.,
known.
is
getting
;
t
In
some
facilities
better,
areas,
can
and
publicly
serve
there
;
-
■
: v
Calls for Competent,.
Aggressive
addition
In
about which
are
to
we
these
are
been proposed
measures
certain, there
great number
a
•
Research
which
have
about which there:
on
those who did not work or think..
ALBANY
of
dan¬
to
gerous to
offered
find
postponable. /When
are
pulling power
people
for
cerned
-Members American Bankers Association AAAA&'
not
.
healthy
'
the
buy¬
sonable profit; so these purchases
ordinary
(The Nazis found slave labor in-,
and
wasteful.)
It
is
efficient
which
purchases, the savings
only if there is
the
stimulate.
provide
stream of active, creative capital.
But businessmen will make in¬
vestments in such capital goods
fact, f psychologists
discovered •> that
rewards
does hot
to
demand. If businesses do
cannot
try
ol ?penalties, ■* and the psycholo¬
gists also warn against excessive
feai* as-1 a penalty, because fear
of
of both individuals and businesses
In
and
services
ers
best effort
only as a result of pressure in the
form of penalties for inaction, and
rewards for extra; exertion. Re¬
wards are the most powerful in¬
corrodes
and
and
make such
our
have nine times the
.
production
just, for
the fun of it. Most of us
makes
more
and
values
people
to
and
more
tories—to make possible low-cost
work's
for
down
thinking
competition
put
into capital goods—
machinery, office
and store equipment, and inven¬
thus
settle
Fewer
.tough
Modern
buildings
be done
intakes
Busi~
their money
think.
and
Few
sake.
what
business.
postpone their purchases
moire easily than individu¬
business
their
first
Let's
later.
out
of
can
als.
between/groups.
capf
of purchases
postpone.
What is true -of the individual
.
We will discuss what
have
v:,
of
made
..
.
,
fellows, put forth
'\
can
to
the
and
number
we
ness
substantially on the ex¬
tent to which the potentialities of
it3
citizens
are
realized;
upon
is
buy
we
buyer is true
de-
natural re¬
dynamic it is will
use
what
beyond
have
we
the
had our^great-
greatest
chance
which
our economy
much
we
to what
for basic needs,
use
larger
A
fluence^
•
choose
varying depths. Withquarter of a cen¬
and
living,
as
have
we
must
more
even
v/ork
*
American
Chicago
and
r
that stand
•
we
depres-
what'
of past accomplishments,
rather, a plan of action to
provide ever increasing opportu¬
money
we
the
pression.
,
but
Teletype NY 1-1248-49
Schirmer, Atherton
more
a
nities for
Telephone BArclay 7-3500—-Bell
in¬
last
boom
est
years
business
tury; we to
f
just barely able
are
minimum
buy
what
26
us
a
or when we buy it. Our
will go for food, clothing,
shelter, that we have to have
regularly. On the other hand, the
depend
recital
.
N.
an
how
nomic
Laird, Bissell & Meeds
new
the
earn
money
"way of life," we should
long, hard look at our eco- (natural inventiveness and resystem to find out
sourcefulness, and upon how well
makes it tick, what has made it! they work together. We had an
strong, what its weaknesses are' excellent example of what could
be
accomplished
by teamwork
and how they can be corrected.
during the war. We are learning
Our answer to the critics of cap¬
hard way—the high
italism should not consist of a today—the
take
Trading Department, LOUIS A. GIBBS, Manager
members
in
how
Securities
Term
had
sions of
r
upon our
Short
our¬
have
we
want to spend, when we want
we
adequate
attacks
determine for
can
will have little choice
tendency toward in¬
sources,
safeguard ourselves against
either
has had
economy
suming
collectivism,
of
us
and
in
dem¬
be
would
to
World
-a
During the last 100
?
?
economy
market demand is unstable.
If most of
*
an
our
being replaced
danger
winning
by
move¬
it
that
and
so
flank
these that
as
the- ih-r
seen
be
social¬
Instability
our
it, and what we want to
buy. The higher our standard of
living, the greater the instability,
and again the reason is obvious.;
merchan¬
our
been dy¬
dynamic,
productive
economy is one which takes full
advantage of the energies of the
people who work within it. As¬
down
national
capitalism
vitiated
v
Our
toward
long step
a
for
Why has
AH of
stability.
by a government
powers, * ^nd to
through
ments such
Industrial issues
factor. in
guarantee could be
toward
road
-
produc-
mass
doubled,
herent
-
would take
the
if
dy¬
economy
■
-
American
for the
second time in a generation
the dynamism and high productivity of American indus-
government sucbf power /
our
forth
why
private
Reason
of the average
come
2.
"jobs for all" has great appeal
to some labor leaders, but such
unlimited
of
War.
of
unlimited
call
That's
our
enterprise must
continue to have the predominant
role.
W
' J try have proved the decisive
t
on
Fascism. A government guarantee
an
namic,
keep
to spend
businessmen.
many
'efforts.
to
we
"
-
appeal. The NRA, with
of profits for every¬
fooled
employees
bigger .incentives
great invention afteX an¬
family
promise
body,
its
selves how much of what
:;
.
popular
and
hard and thinking
Because people are
people,
greater
highly, produc-
dising, We have
give
vote
go
concern
omy,
disguised to have great
measures
private
to
had a"
tendency toward instability? The
answer is
simple: In a free econ¬
the
by
the
go
means
working
and modernized
Of
But
down.
penalty that
No one wants
management
for
hard.
tion,. streamlined distribution,
capitalism
democratic capitalism
up
sug¬
danger
vote were
the issue of capitalism
collectivism,
can
a
techniques
promise,
losing it.
cre¬
which
have
grown
into giants. We have perfected
Amer¬
any
pressures-
dustries
;
popular
a
on
versus
would
is
of ; our
en¬
pri¬
as
other—radio,
the
telephone,
the airplane, the automobile—
has given a start to new irt-
'v
unreasonable to
there
whatsoever
course,
for
its
of
and
dynamic
The
offer greater incentives to its
can
Since the turn of the century
one
In view of what the capitalistic
system has
give
Bank and insurance Stocks
w
job.
penalties—that
broke.. And
'
tive.X€.:"
-
and
something:
•
Dangers to Capitalism
-
with
; 'V ',
namic
;
our
:
we're
tained.
carried out only
'
of how
question
■
't.
world
Rather, I shall address Vny-
peace.
of
living it produces for the ordinary
for
was
em¬
system is the standard
nomic
thatinthe
only
test
ultimate
The
to remind you
to avoid
civilians
million
58
almost
ployed in the United States.
—
like
should
incident
the
dynamism are much stronger
private
enterprise.
For •" in¬
oroke. That's
regulation of employment.
inclined to
have
stance, private enterprise
■
might be
consider
in
international trading as welL
depressions and automatically control
Favors search for new products-and services
If
credit.
which
—
ate
as
enterprise.
rewards
action to counteract
as
fore¬
my
Holds
time,
same
should
cannot expect public
we
terprise to be
and small business and for private
promise. Be¬
fore present¬
ing
But
vate
important role of government in our economy. Sees need for reconstructed tax system, fdr competition and promotion of new"
quarter
casts
people.
more
enterprise
highly unstable, and says aim should be to reduce instability and to en- Y
hance dynamism.
Extols research as aid in progress, and points out
I
America.
in
believe
provide increasing opportunities for
American economy has been dynamic and productive^ and at
■
of
>
Leading industrialist calls attention to frontal and flank attacks on capitalism,
and asserts that defense Ires not in capitalism's accomplishments, but in fur¬
the problems
capitalistic sys¬
tem, I should like to present to
you my view^ as. to the hope it
Before discussing
confronting'
'
the
public
can
be
through
and
we
question.
competent,
comprehensive
acquire
essary
ures
real
a
the
Only
aggressive
research
knowledge
can
nec¬
to determine which meas¬
are
sound;
which
are
un¬
sound. We have," for example, had
•
--
-
*
YlYi/V
Mm:
Volume
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4532
164
proposals offered for the
numerous
.
'management of the public debt.
Various
suggestions
also
have
been
made
for
controlling the
credit.
of
flow
.
And,
of
course,
in the last several years we
:ii;%;%:had
V'
have
proposals for
full
employment.
alone will not do the
open season on
guaranteeing
•.^ Eesearch
:%V'job. It
..
can produce the facts
ourselves have to supply
we
but
which,
^
keep
'
the.,un¬
forces
traditional in
Government
that
Ameri¬
;
;
mus|
competition.
Too
.
plan
f-
for
'"
*
'businessmen,; labor
leaders, and government agencies
have
dynamic and promote its stability.
"we" I mean all of us—employees; employers; farmer? and
By
;
inventive
been
capitalism.,
>
capitalism
of
system
our
out
that;draw
in¬
have
practices and such
government
The
measures.
must
pursue
with
great vigor a
ing the funds of its depositors, is
necessarily limited in the amount
of equity capital it, can furnish,
good
beginning with the British
loan.
Eliminate
•
2.
courage,
<
must
we
.
v
can
but also translate them
into economic policy which will
r
that,
centives
have
urally, by change for the sake of
change—much of it stupid. We
must not only face the facts with
'
'
was
out
creative
all change.
followed, quite* natto
opposition
an
a dynamic
have, already point¬
hope to'have
It is the first step toward
policy which will:
international economic coordina¬
monopolistic practices; but where such limitation results tion; And we must have inter¬
common
talents of our creative, on the part of either business or in an inadequate amount of de¬ national economic
coordination- if
people. M o n e t a r y. reward, v of labor; extend the area of compe¬ sirable credit perhaps the Fed¬ we are to have political coordi¬
course, is not the only incentive, tition; and
promote stability in eral Reserve System can cooper¬ nation and, finally, world
peace.
but the urge to create is damp¬ ways that will supplement com¬ ate with investment bankers in
Taxes Come First
ened in all of us—actors, chenv- petition rather than restrain or working out new and more ef¬
fective arrangements.;
Now, how can our federal gov¬
ists, writers, physicists,..; business extinguish it..,-'V' 'I,
ernment
contribute stability to
managers, etc.—-when the govern¬ 3. ° Government
must
Our government should pro¬
promote 4.
our economy?
ment takes- up , to -90%
of our
Again, taxes come
;
- new and
small business. V;;
mote international private
first:
r ;
earnings in taxes. - We must re¬ ill Obstacles which stand in the
;
trading.
vise our tax system so that »• It way of new business and the
This is more difficult than ever
(1) Our tax system must be re¬
does not-bear too heavily, on the
growth of small business must be today because the war accelerated vised to help counteract both in¬
ed
.
resulted
nostalgia 'for1 normalcy
m
*
■
we
,
followed World War I, when our
;"
If
.
th
.^courage to face those facts. We
must not repeat- the cycle which
*
-
economy, we
many
directed
their plans against
competition by schemes of price
maintenance,
freezing of trade
removed.; The
which
men
special
confront
flation and deflation. This should
be too difficult.
As a basic
handicaps the tendency toward making in¬
business¬
small
must be recognized and new
or
expanded fields of credit made
available to them upon proof of
capable management. Commercial
banking, J faced with the dual re¬
sponsibility of providing an ade¬
ternational trade
a
In
not
government has
this field
our
state function.
principle of tax
rates should
be
already taken the lead in break¬
ing down artificial trade barriers
same
set
to
our
tax
balance
a period of normal
prosperity and then let alone. In
a
year of high prosperity
(such
as the present fiscal
year) a sub¬
and
restoring opportunity to the
private
trader.-'/ If
we
are
to
achieve this goal, we must have
help from other countries. I am
time, safeguard¬ hopeful that we : have made a
stantial
quate flow of commercial credit
and, at the
policy
the budget in
surplus of
(Continued
receipts
over.
1804)V
\
:
on page
r.
government officials.
Government Plays
Federal
Part
? One fact which
face
have got to
we
is that the federal gov
now
important part
capitalistic system. Those
who claim that- all we* have to
do is "unshackle free. enterpriser
are
guilty of loose, irresponsible
talk. We want a government of
.*• laws—not a personal government
-land the'government must administer those laws; But - men
crnment plays an
bur
in
'
*
■
'
-
.;
'
I
anient
an
-
-the
^
'
that the role of governshouldbe merely«that / of
"timpirenr have, their heads in
who say
-
Our "federal
sand.
govern-
least $20
away from its citizens in
es every year; and it will spend
least $20 billions. (It's taking
billions and planning to spend
billions this year.)-That fact
alone makes it impossible for the
ment intends to take at
its
government to be neutral in
in the
% private enterprise must acthe larger part of the burden
influence. In the future; as
keeping our economy dynamic.
_.evertheless, the economic oper*
"*
-
?
'
government
the
of
ations
-
*
will
substantial effect on dyr
mamism, and a controlling influ¬
ence on stability.
i.
Shockingly little; is. k n o w-n
have
a
-
ourfgovernmerit
promote national
prosperity, However, itj.is fairly
easy to indicate areas'^where ;re-r
about what
-
*
should
'
to
do
r
"
'
unquestionably
search would
*
;
!bring to light measures of great
value.
And
we
have enough
knowledge so that certain of our
suggestions can be quite specific.
;
f
-
Government Should Do
What
"'
general stateof government
f ;is - to
create 'conditions ; under
which free labor and free busl:
ness can work effectively in the
public interest. Using this as a
Let's start with a
*
ment. The function
■
:
'
guide,* I propose
that to encourage
/t; * dynamism:; C
a
IV ' We need a complete recast of
Backed by The
*
**
our
tax system.
legislators have
drafted tax laws with an eye to
losing the fewest number of votes.
Yet we must have business exIn
-
'
past,
the
high
pri¬
must be with the
ll:
J
1
,'V
concern
mary
pansion.
;
: •
reached the
-
already
have
We
present tax
system.
Exact figures are not
available but certainly over half
■of the seed money for the growth
©f business has come from plowed-
-|;rr danger point with our
What might have
happened over the past 100 years
if we had had a 38% tax rate,
toack earnings.
by
:
-
business.
taxes,
■i"r.
I i
..
i
s
.'
v
i
.
<•
-
*
\
/
,
OVERSEAS
CUBA'
Buenos Aires
Flores
.
K;
La
Manzanillo V
Matanzas
Sao Paulo
3/4 of 1%.
inquiries concerning this service.
;-rc
\
.■
;
M:.;
CANAL ZONE
->
NATIONAL
CITY
or
NEW
YORK
CaguaS';
:
Mayaguez
■
Ponce
ENGLAND
117, Old Broad St..
It, Waterloo PI.
.
INDIA
Santiago
BANK
Bayarnon"'
c
London*
,
Cristobal
CHILE
'
Arecibo
Santiago
Pernambuco
e.
:r
Sarr Juan
v
Cardenas'!
Santos
selling hank retains entire commission—i.
Manila
PUERTO RICO
Lonja
Caibarien
Janeiro
REPUBLIC OF
PANAMA
Panama
'
Bombay
Shanghai
STRAITS
Calcutta
CHINA
SETTLEMENTS
Singapore
JAPAN '
Tokyo (Limited)
Hong Kong
COLOMBIA
MEXICO
,
Mexico City
>"f'
URUGUAY*
Montevideo
Bogota
BarranQuilla
Medellin
:
ISLANDS
Galiano
BRAZIL
Rio de
PHILIPPINE
Cuatro Caminos
Rosario
'
offer their clients.
BRANCHES
.-V
Havana
-
Plaza Once
•
to
Head Office: 55 Wall Street, New York
and invest-.
of them.
j
destroyed checks.
ACTIVE
ARGENTINA
Tientsin
one
i
or
A real service for banks
THE
Business can|,
workers,
accepted
Valparaiso
but taxes are paid
ors—people,,, every
lost
Ivl'll'/- <•' '
by people. People—live, human
beings—pay all taxes. Taxes on
business are spread among the
consumers,
-
are
accepted EVERYWHERE
Balboa
^
collect
Checks, universally recognized,
We shall welcome,
knows, but there is n6
question but that taxing away
seed money is dangerous.
Too many of us make the mis¬
take of thinking that taxes are
paid
Travelers
known and
readify convertible into* casl^ n* foreign
places as at your own teller's window at home.
If lost, destroyed;or stolen,
(uncountersigned), The National
City Bank of New York will promptly refund the amount of the
The
nobody
-'
«
are
the world over^and are as
business ex-
impact of taxes on
NCB Travelers Checks
N.C.B
pansion if we are to have
employment. Therefore, our
National ©ity IBank of New York,
PERU
Lima
VENEZUELA
Caracas
.Member Federa* Deposit Ingurance Corporation
.
THECOWM.E^Pf^&^INANCIALrCJIRONIflLp
1
•
'
■
■
i
'
'
J'bl}r§d9y,..Qctqber ,10,-J946
-■ ■
c.
support the
By way of comparison, here is
RED CROSS!
Although professional in¬
mutual funds:"Z"
•
:::.
BALANCED FUNDS
.■
.
'
s
1
.
*
"
•
■:
* Decline, from
v
/.
...
••
-1946 Peak to
\vv>V:
15.13%
.v
Fund
■
Fund'
v1:
.
;:
v; 23.97%
B
•
•
23.21 >'
•
Fund
*
who
14.15'.
COMMON' STOCK FUllDS
-
Fund
Fund.-
5Q.76
' 15.68;
E~™^—•
H'
And, regardless of
diate market action,
•:
% 15.04
Fund;
recovery, most of them believe
that the mark-down will be only
temporary.
Sept. 19,1946
Fund
Fund.
own
have
the assurance of
flow
of
mutual
income
fund
a
shares
steady
plus ready
should
they
marketability
f;.Y ■:
interme¬
investors'
—
need it.
i
25.18
Fund
24.67
-
Fund -'
By
—
24.45y.:,'
.'
■>
':Y;;■■■■ ;'":-
i'ii.. •:■■«•.AVERAGES
Dow^Jones Industrials__-_.Ar
DowiJones'Rails«_
Dow-rJiones Comppsite-rO-^t
21.19%
contrast,
common
year
stock
provide
ance
of
31.08
f
$3,94
^Decline in net asset value per share.
A1V figures, including the Averages, are
Adjusted for dividends paid.
quie
a
few
new
issues offered this
neither
continued
the
assur¬
income
nor
ready marketability to the degree
required by the prudent investor.
Undoubtedly
ultimately
some
of
them
will
make
the grade-Mhit
And, regardless of
the whole story—that will require its merits as a
pastime, trying to
time.
The decline in mutual fund "pick the winners"
among each
shares represents a price mark- crop of new issues is a
tempta¬
down on investment values - fol¬ tion that the
prudent investor will
lowing a substantial price ad¬ avoid.
Nor
A PROSPECTUS ON REQUEST FROM
% YOUR INVESTMENT DEALER
vance.
the performance of, several repre-- vestment
analysts do no" agree oil
the time that will be required for
Sentativer
OR*
do
these comparisons
tell
others
won't.
;
Distributors Group, Incorporated
63 Wall Street
New York 5, N. Y.
•
Capitalism-Its Promise
liflllA^
BOND SERIES
Shores
.
Priced at Market
•
*•.
<
Prospectus upon request fronr
your investment dealer or
NATIONAL SECURITIES t
RESEARCH CORPORATION
120 BROADWAY
Now York 5, N. Y.
Union Common
Slock Fund
Prospectus upon request
Prospectus from your Investment Dealer or
HUGHW. LONG & CO.
Lord, Abbett & Co.
INCORPORATED
INCOSPORAHO
48 WALL
lO'.
STREET
ANOUt'
5, N Y.
NEW YORK
few York
Chicago
V
-
Los Angeles
CHICAGO
.
SHARES OF CAPITAL STOCK OF
one
PUTNAM
FUND
Prospectus
from
your
may
he obtained
local investment dealer or
Prospectus
your
The
Keystone Company
of Boston
SO Congress
Street, Boston 9, Ma as,
THE
may
be obtained from
local investment dealer,
PARKER
Prospectus upon
request>
or
CORPORATION
ONE COURT STREET. BOSTON 8, MASS.
Putnam
Fund Distributors, Ino,
50 State
St., Boston
y
ww v *vr
j?'■?*.*,r».iA
TfiE
make
a
business. Show me a busi¬
people are growing,
will
I
and
show
you
that
toward
business
a
true contribu¬
is making. a
tion
There
is,
however*
a
funda-
contribution mental difference between the
make to¬ present situation and that of the
to operate his inter-war period. The present ar¬
profitably. Every busi¬ rangement is such that unless
j Third, the greatest
businessman
ward • stability is
any
business
can
owes this major respon¬
sibility to his stockholders, his
associates, his workers, and the:
public. Only a profitable business
c£n offer security to its em¬
ployees. ■
nessman
; Fourth, every employer should
regularize- employment
ih his
business to the greatest possible
Much
extent.
but
done,
has. already
we
do
can
been
to
more
flatten out the seasonal curve of
employment in most industries.
'
<
Fifth,
last,
and
businessmen
control
should exercise scientific
of sales expenditures. In the past
American
have
concerns
Britain borrows from the Fund and
the Bank she automatically lends
through them. This is because of
the substantial size of the British
quota in their capital resources.
is true, in the 1930s < Britain
It
pai'ticipated in the share capital
of
the
Bank
for
International
unanimous
approval
in
signs
lately, -however,
of criticism, precisely be¬
cause
it has
come
to be realized
with
Until recently, Mr. Dalton's, un¬
willingness tp
Fund
writhe
ill afford to be thus
pocket. To prevent this, it
has been suggested that. Mr. Dalton should change his
attitude
and should borrow from the Fund
the Bank
to
Britain relends what she had
bpr-
Bretton
have
to
be
made, it is
true,
in
is
It
rowed. The bulk of the payments
both
or
an
amount
has
un¬
borrowed
nor
Woods
now
from
the
institutions.
felt
that
;
Britain
should not lend abroad when she
has
and: Britain
limited amounts of it.
the Bretton Woods institutions.
can
out of
or
however, negligible com¬
pared with that of the British
>
w•*
that, by abstaining from borrow-:
equal to the actual; contributions
ing, Britain actually ; lends abroad
madetowards their capital re¬
the part of the British; contribu¬
sources. If this is done, it is con¬
tion that is payable in gold coins
tended, then Britain has neither
from the American loan, so that
lent
Sterling,
was,
Britain.
There have been
Settlements. The amount involved
commitments in connection
^
Britain
(Continued from page 1781)
dynamic. America.
a
-
exchange, or goods in return — at
any rate for the present.
;
\-Obviously, at the present stage,
Britain and Bretton Woods
where
ness
'[•> f V-r:f M ,V.
ii
COMMERCIAL!#!tlNANCiAVXHRONICLE_
no
out
of
lendable
surplus, merely
considerations of prestige
But since
and dignity. Too much of this sort
the Sterling thus-
contributed will
of; thing has already been done.
be
other
borowed
by
countries,
the net result is that Britain has
to export goods without receiving
borrow from the
Bank met ..with fp£, fj^msteither! gold: or foreign
Britain could not afford her
con¬
tribution to UNRRA, or her share
in
the. Chinese loan, to mention
only
these
instances.
The
idea
that Britain must
ances
abroad has been subject to much
Iii
1931,
when
the
pound was,'; becoming shaky, a
City wit: once observed "Britain
not yet know she is bank¬
rupt, Germany already knows it,
Austria has already forgotten it";
does
Today
Britain, .; although
not
bankrupt, certainly ought to know
that she cannot indulge in the
luxury of lending abroad. Lending
through contributing tp the re¬
sources of the Fund and the Bank
is no exception from, this rule.
Those who have realized this, are
likely
to press Mr; Dalton to re¬
amounts of the Brit¬
ish contributions/ To abstain from
borrow the
doing so out of resentment for
past grievances would amount to
cutting off his nose to spite
face.
kept
high
when
business £ was
good and easy to get. Sometimes
some of these expenditures were
Questionable. When business was
slow, and sales tough to get, sales
and advertising were pared to a
minimum. This is neither good
business nor good sense. If we
ets
have
to
stabilized
a
market
demand, selling pressures should
be maintained—perhaps increased
—at the first sign of a decline in
business. We must avoid spend¬
ing
when business is good,
sprees
s6 that
will be available
reserves
when extra pressure
know
of
single
no
do
managers- can
stabilize
business
to
more
market
through
is needed. I
way
help
than
demand
of
stabilization
greater
sales in advertising expenditures
Leaders
in
agriculture
and
responsibility for
proposing measures in their fields
which will promote dynamic sta¬
bility. It would be presumptuous
of me to
suggest what those
labor
face
the
People accustomed,
to
reading character from behavior—and
should be, This I will
measures
say—that
only
not
each
must
have a sound group pro¬
gram but that groups must do a
much better job of working to¬
particularly the character of companies and industries by observ-
group
out than they
have since V-J Day. It behooves
management and labor quickly
gether from
ing their business behavior—must be
even more
impressed than
now
to find the
for
means
usual by
*
promoting
industrial peace on the industrial
front. Strikes and lock-outs are
similar
bomb
in
on
effect
the
to
atomic
the'war front. They In¬
.
jure those not only against whom
they are directed, but the whole
community as well. Means must
be found for settling difficulties
without reckless
structive
leaders
hooves
labor
and
to
of- such de¬
use
weapons.
of
also be¬
management
It
understand
the
facing agriculture and
to support a sound
program. We must be Americans
first and businessmen, labor lead¬
ers, agricultural leaders and gov¬
problems
be
prepared
For the nation's oil
companies not only
are
dramatically dem¬
onstrating their inherent stability by continuing
to operate'
itably with negligible price increases, they also
are
prof¬
taking
unusually progressive action—rapidly broadening their field
ernment officials second.
Perhaps I have said enough to
make, clear the magnitude of the
task that lies ahead. I am sure
you
will agree with me that the
we
are
fighting for are
through research and the development of
Sound
at
heart, and sound in growth—for
stakes
tremendous.
than
the
More
involved
is
maintenance
of
a
promising future.
free
because unless we can
keep our economy free our free
system will collapse. If our free
system in America collapses, free¬
.economy,
dom and liberty will be words
empty of meaning throughout the
world. People yearn for freedom
but first they want bread. If we
do succeed
in
reaching our eco¬
then I predict that
nomic; goals,
the world
ism
drift toward
which
was
so
collectiv¬
marked
be¬
tween; World Wars I and II will
be reversed
many
;
special
and
that
before
have passed
type of .democratic
years
italism will become
a
too
our
cap¬
pattern for
all the world, and that not only in
America
but
everywhere, there
will:be equality
as
well
as
cer¬
tainty »of opportunity for growth
and development of the individtuaL-1—^
^materially,- intellectually^
new
l^any,^;
products.
an
up appear¬
criticism.
their sales and advertising budg¬
are
keep
though she is ob¬
viously not in ia position to lend
even
increasingly
his
v
' '• I •■• *
'
'/.*
■*'♦•
''•»•• r
.'■
"'
v
1 '
'/V!
-.
■* -■ »'*'•' k
.■'■
V
THE COMMERCIAL & FINANCIAL CHRONICLE
1806
Los
Angeles Entertains N-S. T. A
Thomas
Graham, Bankers Bond Co., Louisville, retiring N. S. T. A. President;
Poindexter, Turner-Poindexter & Co., Los Angeles, President of the
Association of Los Angeles; R. Victor Mosley, Stroud & Co.,
Philadelphia, President-elect of the N. S. T. A.
Clifford
Security
Thursday, October 10, 1946
E.
Traders
Graham Walker, National Quotation;
Bureau, Inc., New York; Frank White,1
National,Quotation Bureau, Inc., San Franciscp; Joseph Gannon, May •&»Gannon,
Boston; John O'Neill, Stein Bros. & Boyce, Baltimore.
Mfc tf
Harold B.
Smith, Collin, Norton & Co., New York, Chairman of the N. S. T. A.
Advertising Committee; Donald E. Summerell, Wagenseller & Durst, Inc.,
Losf Angeles, Southern California
Regional Chairman of the N. S. T. A. Advertising
National
■■
i «i
<">< *
...
-~i
John C. Hecht,*
Brown &
Butler-Huff & Co., Los Angeles; Wm. Perry Brown, Newman,
Co., New Orleans; Paul Goldsehmidt, Pacific Co., of California, Los Angeles.
Committee.:;
„;x-
••■:
-
,S..E.;-C. Commissioner Robert McConnaughey; Stephen G. McKeon, Chas.
"
>
<
5
{jScrantbn'& Co., New Hayen, Conn.
L,Moreland, Moreland & Co., Detroit; Jesse Sanders, Sanders & Newsom,
Dallas; Paul 1. Yarrow, Clement, Curtis &
Co., Chicago.
>
•
«<" '...
Los
,
,
•
Angeles Entertains NSTA
The Security Traders Association of Los Angeles en¬
tertained those
on
the special train from the National Se-
curity Traders Association Convention in Seattle at a buf:
fet ; dinner and
cocktail party at the Ambassador Hotel,
Sept. 25.
Wives of the
delegates
were
guests of the local organi¬
zation at Tom Brenneman's "Breakfast in
26, after which they made
beaches.
:
The Los
«i
i* ~rbert Petty' EQuit<ible Securities Co., Nashville,' Tenn.; R. W. Thornburgh,
£J10rnJ?ur9h Co., C.ncinnati; H. F. Burkholder, Equitable Securities Co., Nash¬
Ora M.
Ferguson, Merrill Lynch, Pierce, Fenner & Beane, Louisville.
Hollywood" Sept.
tour through the city and to the
Angeles Traders organization furnished
thirty-five automobiles for the visitors to
Southern California.
ville; Mrs.
a
'
.
see
the sights of
Volume 164
Number 4532
THE COMMERCIAL & FINANCIAL CHRONICLE
is
no
struction
of
There
excuse for the
de¬ ed nationalization of banking and
profit when under industry, in forcing the .people
proper conditions that are attain¬ into a position of mere pawns,
able,, it can serve the people in would result in preventing them
tremendous ways that are far be¬ from raising .their voices in pro¬
Under Nationalization
Under
test against government abuses as
yond measurement
nationalization, the incentives that
they would, be, in .danger of hav¬
maker, profit valuable are elim-j
ing-such voices silenced forever.
mated; If government adds some-!
Under
Nationalization
Regi¬
Under PrivaWEnterprise vWith
thing to; .the cost of production
mentation" under nationalization is
Government
Regulation—Among
when sellihg it to its citizens, it
inevitable, and regimentation pos¬ the freedoms that follow private
is only taxing them in a different
itively leads to the mental deteri¬
form :• ib£ the things they buy.
enterprise, the right to raise his
It
oration of a people,
Manpower voice in
protest is open to the
prevents the. creation .of a com¬
production is sure to fall, and the
stockholder and also to the -con¬
munity in" which- men, through
■-standard of living' of the people sumer
their, savings,
public,- and both are pro¬
can " undergo
the must
go down with" it.
Minorities tected
because
appeal can be
joy of building their government;
could not obtain consideration.
their churches, their educational
made
to
government
in
case
NationalizatioBlVslFireeEnterprise
(Continued from page 1798)
Government
Regulation
—
will have the power to ignore re¬
Man¬
agement is developed in layers of
; authority from the top down. The
most1.: successful
producers ~ are
"
"
those who
see
to it that such pro-}
| cedure prevails. They thereby obi
tain the-benefit for the buyers
of the individual ability of all the
workers.
The result is a growing
.
on the part of industry
to joperate^ih "
manner*4
<
^tendency
*
.Under Nationalization
-
tend
ers
to
—
Work-!
become static.
Some
*
political appointee without proper
- knowledge of the business
may
; be over them. - The effect is to
'•? discourage the exercise of initij
ative for the good of the business
Again, when a certain amount of
progress has been attained, a po¬
sition may be reached that may
be jeopardized by elections, if the
.
-
'^government is; only semi-totali¬
'*•
which nationalization of industry
weaken
the:/ government
Regulation
—
-Throughout the layers of authority, workers can move forward as
the. whole
ly have to become static,
•
.
to the
nation;
certain^
V- j
„
,
Under, Private Enterprise With
Government Regulation
and
have
could
■
the
—
right
to
its
meet
Labor
strike
problem^
institutions,
and fair' to the
9
Under
Nationalization—Various
layers of authority
built the red
tape that inevitably exists under
bureaucratic government, and na¬
tionalization
of industry % without
of government is imr
such, form
of
reaching
a
level
? turnover in political
power will make them lose their
•positions.
...
their
means
Private Enterprise With
Government
Regulation—Variou;
authority
ciently regulated.
layers
of
can
be effif
10
Under
Nationalization
—
The
effect ' is" against
the interest
ol
^
•.{
consumers.
-
Under Private
Enterprise With
Under Private
of
of possession and
Government
Enterprise With
Regulation
The
—
freedom of the
ity to. worship as
understand what is
must
Under
higher
a
and
Pride
people, their abil¬
they will, to
going on about
them, to exercise their own de¬
sires, to build their lives as they
dustry would not, of course, bring
choose without being subject to
such
result, but nationalization
the wills of other men, all under
oncel-started grows toward- com4
rgulations fof government whose
plete nationalization and totali-j
only curtailment of their freedom
tarianism with great rapidity unlies in the protection of the rights
less the people see their error in
of others that
every } individual
time to stop.it.
possible.
*
fear
.
fair to employers j taking part in furthering a pros-j
public,; this would perops Community do not exist!
Life must be dull and drab."; ?
be in the interest of all concerned;
j
T^e nationalization of. one - in-»
be fair to labor j
*
no
.
culture.
natural struggle of men for power
higher positions)? The com¬ over
others, which is an inherent
petition; to improve "-their posi- part of government development,
tions tepds to improve production
finds this character of disability
:f methods; audCeduce costs* * Thete in nationalized
production. Th6
is
..
through collective bargaining!
and
vf where
.
—
Under wise labor laws that would
If their ability and progress and protJuction make possible to
of
The, wage question Would'
Under
Under Private Enterprise With
r
•
detriment
inevitably leads to.
Government
against government
against the constituted
be
authority of a country and if al¬
lowed to prevail, would definitely
*
tarian, or by appointments if it is
S fully
totalitarian;
a
situation
from
labor. Strikes
would
would
'V
fort; consideration
quests
1807
Private Enterprise With
Government
Regulation y* In.
production, .private
its
the
economic
or
cuL
tural economy.
in
a
Profit is necessary
community economy to take
of
government, of the church,
of education, and of cultural ac¬
care
sible
before
recognize
he
can
rights for himself, are pos¬
under private enterprise.
industry
strive&yfor? profit; ? In' doing so
along competitive lines, it aims to
reduce costs and make goods that
are' desired by consumers.
The
incentive for profit builds for the
nation through increased income!.
It enables the purchase of goods
produced by all other industries
that may be directly or indirectly
needed ^in
claim
13
?
Under
Nationalization—Ext^nd-
nationalization would
ed
lead to
extension of police poweC on
totalitarian basis which aims to
the
a'
--- The
of banking- is such
the people it must
be carried on in - a ^manner - free
from political prejudices, which
is impossible under nationaliza¬
tion.
Banking could be utilized
to further impractical government
plans that are against the inter¬
ests of the people.
^
Nationalization
Under
very nature
that to serve
Under Private Enterprise With
Government Regulation
Credit
must be4 extended to -further a
sound
economy
character ! and;
on the basis 61
ability.to., repay
.
loans made, which is only, pofesible
bring the individual citizen under
under private enterprise,.? :' - '
of police in such man¬
ner
that he must follow the gov¬
ernment line or be destroyed,.
Under
Private Enterprise With
Regulation —^Police
system s tinder "freedom of enter¬
Government
of
^
duction and in country. *
the power
prise cafi ? hot
Regulation—Instead
manner that will control the will
competition f for power, in pri¬ tivities^ and the welfare of th$ of citizens or that can
develop an
i
.Under. Nationalization — Under vate industry the competition is people. Profit offers an incentive
espionage system that can prevent
that helps to create a more beau^
extended nationalization,yiabor for more lucrative employment,
the will of the people from func¬
Like every function
must lose its right to strike and which is based upon the exercise tiful world.
tioning. ;
f
Vail semblance of collective bar- of greater efficiency which means of mankind, it can be abused. Corr
14
can
be made
i jgalntogi-'/^It^ttlitijave'?-^©. --idea! reduced cost of production; there ^ rection of abuses
Under Nationalization—Extend¬
5 with "government officials whor foreps in favor-of the consumer^^'^tomgh-? governments regulations.
Government
8
rights are abused. Freedoms that
exist, ;when exercised properly,
develop pride in successful pro¬
16
Nationalization—There
be no checks upon the. meth-r
: Under
can
ods
of
carrying:
banking except
ernment :r may
such
men
where
government
in - gov¬
determine, ( and
on.
as
''
men
often- in..position,
are
the. ones, to be
Losses can he met from,
they are
checked.
,
,
taxation, without the people be¬
coming aware
•
of' it.
Li
..
Citizens become more
...
Which company
is the
world's largest refiner
v , ■
(Continued
on page
18G8)
\
Jr.!
I
:
of 100%
'
i,';
m
mm v-
and marketer
j\.;:
....
•
u.
{'K1 ^
i v.
Pennsylvania Oil?
£?
TIDE
-
"S-.v. .>•
WATER
ASSOCIATED
OIL COMPANY
New York
..
and Wypre
....
San Francisco
1808
THE COMMERCIAL & FINANCIAL CHRONICLE
losses
jumped
to
$518,612,000,
equivalent to $6.06 per capita, the
latter being the highest on record.
Annual losses in the subsequent
decade average roughly $200,000,-:
000, but this period was followed
by fifteen years of irregularly
rising losses, which in several
years exceeded half a billion dol¬
and Insurance Stocks
By
E,
VAfr
A.
This Week
—
DEUSENi
Insurance Stocks V
lars.
This is "Fire Prevention
Week";
journals, popular magazines, radio and movies
ing
financial and trade
newspapers,
urgently impress¬
are
the public the need for unremitting vigilance and intelligent
preventive measures, in order that the destructive toll of fire may
be
on
drastically reduced.
The
Board of Fire Underwriters
losses in the United States for the*
i
months of 194 } aggre¬
gated $373,323,000, which amount
is
in
of
of
excess
eleven
the
annual
out
years
last
fourteen./ If this trend continues,
the
Board
states
that
"total
fire
waste for 1946 will be nearly $600
millions, the highest
known
ever
when
points out that fire
the
total
$501,-
was
It is
to
umn
of
not the intent of this
minimize
fire
the
seriousness,
losses,
for when half a
billion dollars of productive prop¬
erty goes up in smoke in a period
of twelve
months, it constitutes a
waste, to say
of
the
accompanying
in any year of history."
In 1945,
annual
fire
losses
aggregated
nothing
.$455,329,000,
tragedy of lost human lives.
,
the
*
-
•utv
''
highest
since
:
.
serious
economic
".V1'
VV-. •t'v
A,'
Fire
col¬
vA.'.!a' V,. >., ' '*•;''•
*
••
.
/
Total Losses I
Per
Population
($000)
165,222
1805
(000)
83,984
Stock &
1906
Vi
/
85,600
1907
215,085.
;
V/:
217,886
1909
6.06
-
2.45
•88,800
:
188,705
'—mimmmm
v
•:•?•
/ 90,400
214,003
A/.
■
:'
1911
1912
203,764
1914
.
1915
'
;172,033
-1917
—
—
—
/
258,378
7;
289,535
-
— —
-
1918
£,<..
1919
,
.
//TV-
-1916
:
;
/'/ 221,439
,
93,250
V
•
Bv
94,600
95,950
t
97,350
V/r;
® 98,700 - i VV'V:
100,100 ; v
•:
206,439;
;
1913
"'
j.
-
7/7 353,879 7
„,
V 320,540.
:
: 1920
;
:
101,500; x:
.
;
102,900
104.300,:-
7/
495,406
'—"mm
-W
105,711
107,400
•
®
1923.
-1924
W
«
mm —mm
1.75
*
1925
1,077,952 1
A
1,189,795 1
:
1,391,096 !'
® 1,569,141 1
'
;:/•
Vv: 1,592,351/I
4.65
4.83 :vv:
4.88
;
.
mm
2m
mm
kLlL
1927
472,934 A,
..
•
—
1928
'
"
1930
-
r
1931
1932
v
__
271,453 /
.
1935
1936
:
254,959®
258,478 ®
1937
"
1938
1939
r"
1940
285,879
303,895
."
1941
1942
®
1943
.ft 380,235
t
1944
t;
314,295
•;
135,070
V 135,920
137,000
423,538
1945
455,329
mm——'mm
*575,000
__
t;
"
.
"3,084,057
2,834,708
™
®
•;
2.30 V
I
'
2.36
x
2,751,314
2,940,489
2,933,738
3,052,316
3,123,352
3,446,091®
2.83
3.14
:
3.45
V •:
4.18
'? 3,750,169 7/
® 4,237,313
>
sometimes
a good thing when studying a sit¬
uation, in order that our views be
not unduly distorted by the im¬
mediate picture.
For this reason
the accompanying 42 year record
Comparison and Analysis
3rd Quarter 1946
perspective is
of fire losses in the United States
19 New York
is presented. The table also
shows
the growth in population and the
growth in assets of fire insurance
companies over the period, two
items of importance which usually
are ignored
when fire losses are
City Banks
Circular
on
Request
discussed.
Laird, Bissell & Meeds
Members
New
York Stock
The
Exchange
l£0 BROADWAY, NEW YORK 5, N. Y.
Telephone:
Bell
tabulation
starts
with
the
1905, when fire losses to¬
$165,222,000 or less than
$2.00 per capita of population. In
1906, due to the San Francisco
Department)
G. A. Qibbs. Manager Trading
earthquake
and
-
conflagration,
ANAYLZED
REVIEWED
—
f The
borrower
and
the
a. m.
Inquiries invited.
to 5
p. m.
(P. C. T.)
losses, if made, must
profits and that
from
bankruptcy will throw him out of
business.
York
—
Chicago
—
TELETYPE L. A.- 279
additional
checks / with
behind^ them.
;
the
becomes
part of government it¬
can
control it as it
a
which
fit.
,
%
-
.
i
-f-1'
f■
i
*-tw
-V
...
-
L. A. 280
—-
'
tal.
In 1905 total fire losses rep¬
resented
approximately 30% of
assets;
more
than 90%.
1906 losses were
The high annual
in
fire losses of the 1920-1930 decade
approximately
24.0%,
1945, fire losses repre¬
average
in
sented
little-
total assets.
5
Another
than
more
'•
•'
-
10%
of
r
.
.
that "should be
factor
Seattle
V
Y
:
:
Population data interpo¬
annually from U. S. Census
Notes:
lated
compiled
Under¬
Fire losses as
figures.
by National Board of Fire
writers since 1916; prior
Commerce."
of
"Journal
'
;
.
S.
U.
by
compiled
Bureau of
:7:7V/®
.
77;
"The
dollar as
of
Value
Spectator."
Labor.
Abstract
and
States
United
the
of
Statistical
from
thereto,
Total
insurance com¬
assets of the fire
panies
tor
••••:'
•
Enterprise
Free
vs
for
capital' and one whose
powers to fix prices and profits
could actually destroy the ability
of private enterprise tiT function.
terprise could not live under the
conditions that would arise. <
It is inconceivable
that there
lasting peace between
or even conditions of
be any
can
the nations
that
are
Nationalization
Taxes
—
levied by localities, coun¬
private en¬
industry because
all
stabil¬
which will allow for
peace
and sound methods of living
while governments are engaged
ity
strain upon such divisions.
Under
Private
Enterprise With
virtually stealing the rights of
peoples through taking from
them ; little
by little,
or
more
rapidly when they can, the means
under which their individual in¬
telligence ; can play; its part in
t6 furthering the business and social
paid to communities, counties,
and
states
that
are, necessary
activities, of
their maintenance.
Xven
funds
Nationalization—Capital
of
interest.
of
source
whether
taxation
an
the
they
the pay?
Whatever' the
"funds/
are
be,
may
receipts
from
from government bor¬
or
rowings
sents
without
used
are
ment
Otherwise,
or
abuse of the
it
use
repre¬
of capi¬
tal which should be paid for on a
legitimate
basis
as
protection
a
to the whole economy.
Private
used
be
must
dividends
would
Capital
interest, otherwise it
or
not
—
be
attracted to
Under
Nationalization
Man,
—
because of his characteristics and
propensity
make /errors,;
to
quires checks
his
for
upon
re¬
mis activities
protecpdn and that
own
■
■
enter¬
j
those
outside
of
/because
government
can
Under
Nationalization
—
Under
nationalization,
unfair
competition with the rest of in¬
dustry would be certain. Govern¬
ment would be using capital with¬
out costs whereas private industry
would have to pay for its capital.
nationalized
government
only
industry, it would
have
to buy its parts from pri¬
industry, which would imme¬
diately put the parts industry in
jeopardy as there would be no
competition for government,
vate
which could fix the prices which
profits
be
of
private
and
what
general
would
Regulation
be
industry
wages
it
nationalization,
no
competition
for capital for investment in pro¬
Private
—
.
have
full
the
Enterprise With
tion
mental
of
within
multitude.. Jt
the
under free
come
to
the fact that
men
are
prone
and at times develop un¬
error
fortunate characteristics, are pro¬
vided
private enterprise it¬
in addition, within
the control of government under
laws
that ' require
government
self
by
a
and
regulation where it may be found
in the interest of the people.
greatest
exist.
.
an
unfair competi¬
The American Way
Insofar
gressed
as
Just / what
It
all
Constitution
conditions
under
from
out
of mediocrity or
Way?
pro¬
to the present, the
Way has proved to be
effective for bringing
most
men
]
«
has
up
American
the
humanity
actual hardship.
is
American
the
functions
Bill
and
from
of
our
Rights.
21
Nationalization
Under
whole
freedom of
men
The
be
can
broken
character, efficiency, and the op¬
portunity
for happiness
among
the
people.;■.
Under
Australia and New Zealand
the
BANK"OF
from government
attained
is
—
which
under
system
•
.
7:• ■/1 V/V• 7;;■'.■;>:
NEW
tem under which
Paid-Up Capital
Reserve
Reserve
can
men
utilize
under conditions of freedom from
abuse
and.--under
and prosperity
which ' progress
be
der
£23710,000
30th
..£223,163,622
THOMAS
BAKER HEFFER,
General
Head Office:
Manager
George Street, SYDNEY
LONDON
29
OFFICES:
Threadneedle
47
Street, E. C. 2
-
Berkeley Square, W. 1
'/./ Agency arrangements with Banks'
throughout
the
U.
S.
' "
A.
be borne in mind that
must
if only a
,
Aggregate Assets
Sept., 1945
attained is furthered ;un¬
private enterprise.
It
—£8,780,000
6,150,000
Liability of Prop.- 8,780,000
Fund
v'
savings in such manner as
to build for others and themselves
can
1817)
(ESTABLISHED
their
government
WALES
SOUTH
Enterprise With
Private
Government Regulation—The sys¬
few industries were na¬
or -even one
or two,
tionalized,
of
many
those
that
not
would
whole
the
throughout
be
against
reasons
nationalization
as
reach
NATIONAL BANK
economy
far-reaching.
of INDIA, LIMITED
However, in the case of the par¬
Bankers
ticular industries which were na¬
the
harmful
effects
they might reach
allied industries which
not nationalized. One must
to
Head
were
would
be
a
strong
force,' there
urge
on
the
Branches
and
.
if
this were
done, it would
India/ Burma,
Aden
and
and
Ceylon,
Kenya
Zanzibar
Subscribed Capital
£4,000,000
Paid-Up Capital
£2,000,000
Reserve
Bank
Fund
£2,200,000
conducts
banking
and
every
exchange
description
business
Trusteeships and Executorships
also
ultimately have to reach through
in
26, Bishopsgate,
London, E. C.
In
Colony
The
part of government to extend it,
Government
Office:
would exist, and
into many
the
Kenya Colony and Uganda
tionalized,
.
enterprise had
only
uality of the people can function,
and unless it does function, the
are,
tial nationalization in
interests of the people would not
be jeopardized
because- private
is
enterprise and govern¬
regulation that the individ¬
ment
checks that. are necessary to over¬
also have in mind that with par¬
from
Intelligence which
varia¬
activities that lie
lies within the tremendous
The
destroyed with nothing
to take its place-that will build
partial
If
Government
down and
is
all
,
good, for"* all can
not
Retrogression will displace
take no part in them.*
Yd progression. Peace will be im¬
* ;
;
' '
Under Private Enterprise With possible.
nationalization
under
abuse
prise.
among
he people have not and can not:
Enterprise With
paid for either by
whole.
the
smartest
me
.
Under
government,
private industry could obtain capithb ,foi?
spund enterprises.
The
* ,T
San Francisco
nearly eight times their 1905 to¬
competition
PRIVATE WIRES
New
were
Government Regulation—Without
„
2X0 West 7th St., Los Angeles
that in 1945 their total assets
total
of forty years ago.
It will be noted
As added protection to
ductive enterprises.
BUTLER,HUFF & CO.
.
insur¬
are
taken
be
there
-
Orders solicited.
CALIFORNIA
companies.
of
assets
fire
knows that
Under
OF
mutual
Government Regulation— Taxes
Under
Special Bulletin and Booklet Service to Dealers & Brokers
Trading daily 7
ance
total
the
and
ing with each other.* The banker
might be possible for such indus¬
try to pay its labor.
COMPARED
—
shows
stock
a
should
Quoted
—
all
lender represent the people deal-1-
the
Insurance & Bank Stocks
Sold
lation
1935-39 aver¬
age,
mands,
Loans
—
would pay in such a manner
that it would be determining what
—
and 141.4 for the year 1913.
Thus
today's
dollar
has only
about half the value of the dollar
^
The fourth column of the tabu¬
Under
it
Bought
pared with 100 for
"
-
,
in
Regulation
the automotive
taled
1-1248-49
Teletype—NY
-v®
year
BArclay 7-3500
stantially above the 1932 to 1943
their
Under
little
sub¬
were
■
level.
;
,
Government Regulation
''Estimated.
a
losses in 1944 and 1945
of
all
others - concerned.- < Such
power of
law
• A
- nationalized bank can have; no. checks can not 'exist in forms
such secondary protection as it
necessary
to protect the public
2,630,815
"
: T
earlier
1
expressed in dolla^
is the great change in, the value
of the dollar that has taken place
over
the past four decades.
As
of July 1946 the index of the
value of the dollar was 71, com¬
government operation, which puts
sees
2.17
•
actually
over
undertaken
v.
y' ,'v
losses,
ties, or states under private en¬
terprise are lost to them under
2,229,590
®2.07®
:
a
bias that
2,273,866
2,556,122
2,815,293
2.10
7
made free from any
self,
2.08
V
can
Under Private Enterprise With
as
2,640,8-53
m 1.97 -tv
132,520
133,370
r
134,220 V VV V
"
y
upon
government,
develop a control that
can force
those wanting loans to
side with the*"ins" in government
® 2,484,357
:
1.84
130,850
131/370
year
shows
on
particularly over the 1920period, though per capita
years,
1930
Nationalization
2.16
.
42
period the
has
increased
from
population
approximately 84,000,000 to ap¬
2.14®/
:
V
128,150 V
129,050 x
129^50
275,102
-
X
4.08
V
.127,250
: V
2,867,832
"
V
126,350
■
235,263 ®
266,659
-
V V
■
3.65
125,450
'
•
271,197
•i-
:
124,550® ■M: 3.21V
-
this
Over
basis
*
improvement
while
the public and all who deal with
1,627,345; f
the. banks, to those checks, that
1,782,383 > ]
are placed
upon wrongdoing and
1,913,477: [
2,092,499 i- inefficiency by management, gov¬
ernment regulations are provided
2,248,197 j
2,503,063
,3.79"•
123,650
'
400,860
1933
1934
; >
V
"
501,981
451,644
*
4.85
3.88
'119,300" -;
vt 121,000 rt;* V
u-: 122,775:
464,607": *
.
®4.02®:
/ :117y60a
•
'"459,446 '-
1929
1946
4^0
.
Mm
873,945
965,859 t
'
'
V
4,62
.
capita
some
losses
might arise from government de¬
W.
2.58
4.25
„
in
1926 losses.
and
opment.
'
109,100.
? VlV.
®
110,800
7t7/- 535,373
549,062 / i t ; 112,500 V vt ;
- 559,418 ;7
114,200
V V
; 561,981; ® ® 115,900
times
high, though it is not yet certain
that they will exceed 1924, 1925
'
®
3.43
•
eleven
previous 39 years; with regard
to
1946, it seems probable that
total losses may reach an all time
Government
2.27
A
/
a
exceeded
the
are
'
11926
-:vv V
2.13
2.85
:"r
tv
.
.2.19
•
1922
r
/;
>.
:
■:
572",899
v
2.33
V
??-
:<•:
,447.887
1921
:
per
recent
which leads to totalitarian devel¬
2.33
91,973
/
217,005
'
::
2.10
'
1910
$455,329,000,
which
'
1908
1945 losses were
figure 'that has
year
depenuent
544,182
:
"tvvOV,2.47®;.VV
87,200
v
the
(Continued from page 1807)
($000)
1.97
fire
of
Mutual Co's.
i
Capita
record
But
'
Year
that
given its due consideration in
praising the long term trend
the
•' t.•
Total Assets
• •
■
1933
dropped again be¬
low
$300,000,000,
under
which
figure they remained until the
year 1941,
" ;
,
been
981,000.
totals
the
of
1930
until
not
was
proximately 137,000,000, a gain of
53,000,000 or 63%.
Consequently
annual losses
In
National
first eight
It
>
Thursday,'October 10, 1946
of
•
Volume 164
stitutional, do not curtail
in
together with the savings of his plus over/his hepds of such pro¬
fellows, v.
'
duction or activities in the' service
;
; rF,rom these reservoirs, through of others as he may personally or
investment, such savings go tc Working with others individually
truly Con¬
Our laws, if they are
dividual
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4532
in¬
any
accomplishment
except as the rights
any
whatsoever
of others may
-The rights of
the labor
reward
be' jeopardized.
of others
who
receive.
savings are, there¬
fore, his profit, his property that
others are in truth may bd building the homes, the
the very rights which an Ameri¬ factories, the.means of transpor¬
can himself is justified in claim¬
tation,. 2nd the production
ing and demanding. They are the throughout his nation that make
rights that: a man must have for it possible for. all to exercise such
a
abilities
full, complete, and constructive
life
that
builds for
himself
and
:
j
It
Of
all
to¬
savings
of
ernment
officers and support
government in
its
the
with
can
derful things.
savings
accomplish
'
mentally
in
activities. His methods
ally
simple.
His
are
i£ters in order that they
of
duties
other
may be
to carry
basic¬
are
of culture.
that, he .ipay
more
from his surpluses, and
has
education
nation,
to
spare.
the
measure
-
could' not
These .tokens also
value? of .his : work,
whatever it may. ber
,
meet the
of
his
cost
of
;
gov¬
children.
His
not
but
tjhem
(jommunity,.
-his
tountry. They
gathered
.
stme,- .and
j He'
Federal
r
System
has.
revised
version
of
a
Regulation C,
of
•
this
He
is
in
danger
propensity today
busy
v
controlled,
can
and
jead to self-
the
betrayal
of
of
drafts
or
domestic
goods
bills drawn against
foreign shipments of
secured by warehouse
or
ceipts
or
covering
readily
re¬
market¬
able staples and the acceptance of
drafts
The
bills drawn for the pur¬
or
pose of
creating dollar exchange.
revision
order .to
■
has
been
simplify in&
made
in
clarify the
.
on
earth, drawing from all
coun¬
tries to
do sdi- He is representa¬
tive of all the nations, and if he
acts to restore thOse^ freedoms he
has lost and insists
upon their
maintenance,
after God he is the
He is
sized
it
that
pliance
that
should
with
should be
.
■
com¬
the7 provisions
the regulation will not
an
emi>ha-
be
technical
mere
of
1
necessarily
accepting bank protec¬
tion from loss.
American.
an
observed,
afford
hope of the world.
principles'
broad
Sound acceptance
practice depends primarily upon
suffering
is * free
Reserve
,
his Constitution and Bill number banks experienced in ac¬
Rights, and while he stands by ceptance credit
procedure, and
principles. and helps the from the Federal Reserve
Bapfcs.\
peoples of other countries to un¬
"While the Board,... in stating.,
derstand them, he is an example
the requirements that must be •
that all the nations may follow.
He peopled the last continent met, has endeavored to lay down
to
the
Revision by Reserve
Of Regulation G
profits to
own
peoples
of
exercise
good
by. accepting, banks
credit
judgment. " The
principal reliance for the mainte-,
nance
Notice regarding" a revision by
the Board of Governors of the
his meet with catastrophe,
represent the.sur¬
-v,■'"
arid adopted, effective Aug. 31, 1946,
war.
only others in his
,
;4:\:
:
of
He is sympathetic and will give
aid
■$?
"The Board of Governors of the
these
and frbm) whbfeyeT they may be and what¬
he:' helps, to_ builds up his ever their nationality, when they
He has built
are
.
victory in
he
lows:
District by Allan
Sproul, President of the Bank on
Sept. 12. Mr/Sprout's advices fol¬
under
pavings; are; his ;prop^?ty
reservoirs of these savings called
bnnks where they'
requires personally,
of banks in the New
Reserve
.
ernment,: the cost of religious in¬
struction; and the Cost of the
he
bantys of drafts
exchange, was issued
of
York
consequence,
many wa(y6
bills
to members
others, but his life of freedom
regulation. In making the revl-*
helps protect him from the temp¬
tations they create. He surmounts sidri, the Board has had the bene¬
them When he is content to live fit of suggestions received froihla*
lands of other peoples even after
If .he could not produce
}
than
peoples.
destruction
stultifying influence.
exchange
his goods without
having :^0: firid
others who have things which Tie:
Wants whd want; things which. he
,
not
to carry on in
for the benefit of
and others employed in the school and know their
peoples.
systems live.
He does not like war, but he
From
his
savings he builds Will
fight if the world'needs him
hospitals, "places of amusement, and to the
bitter end if he is
and provides for the development
attacked. He does not covet the
such
measured in tokens called money
in order
from
in
but his ultimate faith is great.
i With all mankind, he has those
human characteristics which, if
; When he makes mistakes that
affect; government through ^neg¬
lecting his duty as a citizen and
in not voting for men of integrity
or
ability, he* may suffer 1 from
government exploitation with its
up¬
government. He
forgets his belief in
and listen.
sblf.'
has
with
suffers
himself, he seldom stops to look
He enjoys
I From his savings he has schools
exchanging goods
coiistfucfed and provides the in¬ with the peoples
pf other nations?
come upon which the teachers he likes, to visit their countries
power
surpluses
he
and
and the fact that when he is
proces¬
In general he has faith in hiiri-
r
God
because
him
are
way
without
compulsion from
those whom he may select to pro¬
many
all.
the
keep and the income of their min-
won¬
apd understanding through,
savings
enable
own
their acceptance
may have ruined
corrects
for increasing
disposal and the
his
his
they are dressed up to acceptance by member banks of
seemingly fine intept even drafts or bills of exchange. The
though, as history has "developed, regulation governs the acceptance
methods
at
Ways that
activities for
qhurchCs built, .pays for their
:
r
his
From
new
in
carry,
utilizing such time so as
give him pleasure and culture
to
omtheir work.
;
considers,
God
tance by member
or
When
mistakes. He
inventions,
new
and
his benefit.
to
but
grows
convenience,
means Of
,
.
and
his
serves
4' He is naive in
and builds in new
ways. His mind is free to study
government to de¬
vise
ways
and means through
laws and regulations to protect
the rights of all.
? ;
\
4 From his savings he pays taxes
which provide the income of gov¬
can,
stops
i He
is often influenced by alien ideas
profits from those mistakes when
he
ses, new
the time
positions
his
free
*He
many
lows whom he wishes to place in
He has
provide
fc^his pi-otectloii fhroughv insur¬
ance arid by-making them serve
to add to- employment^-further
production, and increase his in¬
come. His savings may be, small,
joined
makes
for
how
to Conceive.
such
others, they
He
»
and election those among his fel¬
'
.
use
which
and
culture, and beauty.
does
rights,
therefore, with
property rights which he has,
save something from his daily
work. He can exchange his sav¬
ings for the production that arises
from the savings /oL others: and
so broaden the lives of all. He can
•
entities
of
one
American function?
simple
He
his ~ world
-
of people into business and
industrial
broaden
build his life,so'that it may make
:| He may take part in organizing
groups
of
Bill
and
the power to produce beyond
needs.
lives.
to
uses
as he may wish if he does
trample the rights of others,
sometimes
his procedure,
these
average
is
American
opinion
not
vide; him
government protects for him
by laws passed for such purpose.
Profit is the surplus which the'
have to im¬
may
own
his
gether make up the great econ¬
omy of America,
i
He designates through selection
Constitution
Under
our
their
prove
others, to /th& greatest extent that
lies within his power; They are
the rights that are' ailoted frim
by our
Rights.
they
as
His
1803
placed
of sound-practices must be
upon
that
judgment and
the continued development of sea¬
Federal Reserve System of Regu¬
express
soned policies in: this field pi ex¬
lation C," dealing with the accep¬ tension of bank credit."
his
■l.
Important 2-way trade
with
Middle America
long served by the Great White Fleet
'TiHE coffee, bananas,
sugar, cocoa and other
lllipff!
nutritious
ica
COLOMBIA
GUATEMALA
COSTA RICA
years
HONDURAS
J
•
'
'I'
CUBA
vV jl 'r-;
j•
—
so
popular
have been
Middle America is
coming
tropical foods of Middle Amer¬
on
North American tables
transported northward for almost
—
tained
over
50
lished
routes.
by the Great White Fleet.
new,
•Southward these familiar white
JAMAICA, 0. W. I.
DOMINICAN REPUBLIC
NICARAGUA
Today—after the
V
EL
the
Manama
ECUADOR
SALVADOR
•..
•
.
'
•
..
-
'
•,
••••..•
war
the Great White Fleet's
The
company
necessary
again.
long estab*
is building fast,
to
meet
the
expanding trade with Middle America.
re-establish its passenger
■
.
own
being main¬
And, in the months ahead, the Company will
farms add factories.
.
are
fully refrigerated vessels
needs of
ships sailed
deep laden with the products of United States
1.0
into its
Regular freight schedules
ship diversions of
If
years—this important 2-way trade with!
you
service.
have a shipping problem involving any
of the countries listed at the left,
please call onus.
PANAMA CANAL ZONE
IBI
United fruit company
General Offices: X Federal Street, Boston 10
,
-
'
'P
4;
.
Pier 3,North River,New York•
321 St. Charles
St.,New Orleans 4
■
:v
,
-
.
Hi y.
;
r-
Washingtotf-St.f Chicago2
lOOl Fourth St., San Francisco 7
<*>
,
-
.
r
-
; ;
THE
1810
cash. To accomplish this the com¬
of the end of last July
net working capital of over
as
pany
had
It should enter 1947
$200,000,000 of
working capital. A year hence,
$186,000,000.
Railroad Securities
with
net
than
more
then, the company
history, 1935, the company
lows, Union Pacific common continued last week to
more
than $33,000,000
progressively■ <Into■&'new*■'.!.
:
^
•> w'/,; reported
tion for the present dividend. For available for fixed charges before
low territory.
At its worst the
the current year, and without re¬ Federal income taxes.
In only
stock hit a low of 117, affording a
sorting to tax carryback credits, three
years of the entire depres¬
a
return of 5.13% on the $6.00
the
road estimates earnings of sion
period did income available
dividend maintained throughout
the severe depression of the 1930s, $12.75 a share on the common for charges before Federal income
stock.
For next year, based on taxes
drop below $35,000,000. Even
Which period saw a large number
of our standard and well regarded granting of the full freight rate these impressive figures do not
increase requested by the carriers,
tell the whole story of the strong
industrial corporations reduced to
sion
•
'
•
*
.
justification
of common.
stock.
ings did not include the
status
of
a
burdensome.
been
never •;
-
Pacific's charges
Union
coupon..
They will be even less so in the
future.
Allowing for payment of
Interstate Bakeries
a
Preferred
small maturity
Jan. 1 it is
obligatory re¬
on
indicated that these
quirements
will " be
down to
around- $9,800,000 entering 1947.
This
represents a reduction of
some $4,300,000 as recently as four
Pacific Air motive
' Common
or
Moreover, the
five years ago.
program
is not expected to stop
there.
The company has a maturity of
$100,000,000 of 1st 4s falling due
July 1, 1947. Based on informa¬
tion file# with the TCIC; ihrcori-^
nection with equipment financing,
Chicago Railways
1927
Com. ?'A" 5s,
.
that a large part, if
it Is indicated
not
paid off in
all, pf this will be
net the
company
substan¬
is now re¬
operations.
ceiving from its oil
this
few months ago the road
was
successful in completing the
lowest-cost term financing ever,
accomplished by a railroad.
A
large issue of 45-year bonds was
sold at a premium; with a 2}A%
Only
have
'
tial
'
Arden Farms
.
any
,
proved materially in the past cou¬
ple of years through retirement
of debt and low coupon refunding.
Common & Preferred
.
.
investment
The
towards
inclined
already strong stock has been im¬
Union Pacific looked
forward to continued; profitable
operations with adequate- protec-i
Common &
be
over-optimism.
the
! f
of the estimates it can hardly
claimed that the management
would
agement of the Pennsylvania. In
its earnings estimates filed in con-*
nection with the rate case, how¬
ever,
and the
cific
be
exhibits as did the man¬
rate case
position of Union Pa¬
company's common
The low depression earn¬
earnings
pose
if the management
in its
visualized catastrophe
had
for $13.75 a share
Considering the pur¬
the estimate is
purely nominal, or no, dividends.
This weakness might have some
Once the question of
the $100,000,000 1st 4s maturing next year
is out of the way, it is believed in
most railroad quarters that on the
basis of
indicated
earning power
holders of the Union Pacific
stock
mon
can
com¬
look forward with
considerable confidence to
an
in¬
crease in the dividend rate.
of pessimism can
above their 1946
work
the first producing well was com¬
plied in September 1945.
should be bur¬
affect the think¬ dened with no more than around
ing of investors, and the bad repute into which even the best .of the $7,000,000 of fixed charges with a
rail stocks have sunk, is strikingly demonstrated by the recent mar¬ strong possibility that they may
ket action of Union Pacific common.
While most representative rail be below $6,000,000.
In the worst year of its depres¬
stocks have shown at least modest tendency to stabilize at prices
The extremes to which a wave
Thursday, October 10, 1946
COMMERCIAL & FINANCIAL CHRONICLE
Up to now oil profits have come
largely, if not entirely, from the
Wilmington
field
of
Southern
California where Union Pacific's
start
not
did
production
until
The Banker Looks Abroad
(Continued from page 1796) \
,
\
,
the fact of particular signif¬
icance to bankers—is that in spite
States,
of all these difficulties
right here is to give enterprise a
chance to produce without being
impeded by labor strife, mistakes
in price controls, and other handi¬
caps.
We have also to deal with
money—that is, to stop the in¬
crease in money volume
and do
what we can to keep the present
money "forces in leash—but that
medicine is not only difficult to
administer, but powerless unless
combined with increasing produc¬
and
France is
moving ahead. There is little un¬
employment;
production
is in¬
creasing; Paris is as bustling as
ever; it still serves about the best
all
it
this:
is
The
is the
vidual
citizen.
Give
will
he
and
key to
pros¬
effort of the indi¬
perity
chance
The secret of
world.
in the
food
him
half
a
improve his
lot, and in doing so Will improve
the conditions of his country. That
is
in
happening
France.
medicine for
The
his
field; the shoe¬
maker somehow repairs or pro¬
duces shoes; the merchant scrapes
tills
farmer
the
for
together a stock of goods to sell;
life returns towards normal.
Of
our
important
most
inflation disease
tion.!
So, no matter what road we
travel, we come back to
the need for giving the individ¬
ual, alone or in association with
others, the chance to use his in¬
itiative; • energy, and genius. :->v
start to
course,* it is true that as else¬
where the efforts of; individuals
Conflicting Principles
of
J Government
enormously ' helped; or' im¬
gas operations last year, on a very peded by what the government / All of this brings us to some?
discussion of a great underlying
conservative
accounting
basis, does. ;
I
1':"
Z1 y
conflict ^ which * ; today/
amounted to $6,172,238 compared
1 This* power of individual initia¬ world'
troubles every one of us here, and
with $7,681,904 in 1944 and $8,- tive is being illustrated, not in
836,651 im 1943. - On the average France. alone, but "iri. Germany which the traveler abroad en¬
these operations should alone be and England and
all; through Eu¬ counters in almost every area he
sufficient to carry total prospec¬ rope and elsewhere. Tn fact, the visits. That is the struggle which
tive ; fixed changes leaving earn¬ latest word that comes from Ja¬ goes on between two systems of
ings from: the: highly profitable pan is that the industrious indi¬ government; one which seeks to
railroad properties and extensive vidual, qne way or another,. in use the energies of the individual
outside investments for the stocks. spite
of disorganization of his by regimenting him, by telling
Before Federal income taxes the country, is gradually lifting him¬ him what to do and enforcing the
from oil and
Net income
1937.
operations in the three
1943-1945 brought in, net,
an
overage of $3.40 a share of
tomnion: stocks Additional impor¬
are
oil and gas
self and his fellows from the mire
years
up
This is the
toward the sun.
number one lesson that I, would
demands with threats and
other
penal¬
which
seeks /to
stimulate the individual by giv¬
ing him freedom, that he himself
the
ties;
draw looking abroad today. It is
in prospect, the lesson of the enormous vitality may decide, within the limits of
particulary from the rich Rangely and the overriding importance of certain necessary social restraints,
field in Colorado. Under the pool¬ individual;; initiative anC efforts/; what he works at, how much he
produces, where he lives, and how
ing - agreeriiehts with oil :- com¬
he " takes; his satisfactions;
The; Laws of Money- * *
The
panies ' for development of the
land Union Pacific's participation
In passing one can hardly re¬ contrast is between what we may
will be about~76%~- onr-the 3,314 fer to "the experience * through call "Statism" or ?. "Totalitarian¬
ism" or "Collectivism," and what
acres on-which It
owns oil and which Europe is- ribw
going'with¬
in this'country we Call "Democ-;
gas rights. / On the pooled lands out rioting that -there's are again
being demonstrated ail through racy;^ J though : some other coun¬
the Cohtinent, and: in other parts tries use that word In a -different
tant :hil: profits
are
-
*
'
^
of the world as well, the inexor¬
-
■
:
'-'MEMBERS
''
Stock Exchange and other
and Commodity Exchs.
York
New
r
231 So.
\
^ l 1
^ v 7 7 T, ji ,r - <"
>' i• '
>
O.
leading Security
120 Broadway,
sense."
*When there
is too much money in the hands
of the people in relation to the
amount of goods which they can
buy, there is price inflation. Dur¬
ing the war patriotism and price
controls
suppressed, and partly
defeated, the operations; of this
law, v but,
underneath, it was
working to perform its usual
havoc, and all through the world
Unfortunately the expressions
"right" and "left" have somehow
been all mixed up in this discus¬
sion. Many people speak of "turn¬
ing to the left'? and "liberalism"
when they mean turning to A
form of Statism typified by com-:
piunistic Russia. This is exactly
the opposite of what was meant
by liberalism in other genera¬
tions.
The
American and the
able laws of mbhey
**
»
New York 5,N.Y.
Railroad Bonds and Stocks
V*
L&Salle St., Chicago 4, 111.
•
r.'0,
,
Specialists in
pflugfelder, bampton & rust
RAILROAD
Members
New
it has now broken into the open,
York Stock Exchange
and inflation of money
New York 6
61 Broadway
SECURITIES
Bell Teletype—NY
Telephone—DIgby 4-4933
inflation
1-310
the
than the mark. When we
to give a big tip; after
left two cigarettes be¬
side the plate.
;This
inflation is the second
great problem of reconstruction,
and it is close kin to the problem
wanted
dinner
Denver & Rio
23 Broad
Street
•
_
Grande Western Railroad Co.
Railway Company
St. Louis-San Francisco
STOCKS-BONDS
When issued securities
New York 4, N. Y.
Telephone BOwling Green 9-6400
,
Complete arbitrage proposition
Teletype NY 1-1063
of
to
'oh request
discounted
When issued profits
we
giving the individual a chance
work; for if the individual can
work, he can produce the goods
and the services for which money
;
used, and so help restore
between money and
can
.&•.
ji.va ;
prices. In Germany
is more acceptable
money
Sslscted Situations at all Times
GUARANTEED RAILROAD
of
cigarette
is causing
ij
'
•
.
"1.' •
'
balance
prob¬
two problem
goods." So thb number one
'
120 BROADWAY, NEW
Railroad Stocks
V.*'
••
EST. 1896
'
Members New York Stock Exchange
\
.
be
the
SUTRO BROS. & CO.
lem and
the number
Of
Telephone REctor 2-7340
rope
in this respect Eu¬
course,
is
Revolutions
both
were
against the domination of
the individual by the State; they
were fought for the principles of
individual liberty of Franklin and
Jefferson, and Voltaire and Rous¬
seau.
Curiously
enough,
there
as
Communism.
little
In
choose
to
reality there is
between
them.
is
Fascism
only another form of
Statism. Probably we do well to
avoid the terms "right" and "left"
and
about
talk
Statism
or
the
contrast
vidual liberty. In this contrast the
United States has stood since its
dividual
liberty.
Today the battle of the two
unlike the United
not
Mclaughlin, reuss & co.
Trading Markets In—
Members New York Stock
Exchange
SEABOARD ALL FLORIDA 6/35
paid'
BOND
CHICAGO RAIL 5/27 A
*
*
j
BOwling Green 9-8120
Boston
*
Tele. NY 1-724
Philadelphia
\
Hartford
1. h. rothchild & co.
♦
National Association
of Securities Dealers, Inc.
i
4
52
'c" I
wall
i-j
*
street
Meriber oj
HAnover
2-9072
f
•
*
.i
• •
i,
'••
TEL. HANOVER
n. y. c.
NEW YORK S
ONE WALL STREET
-
Wall Street,,New/Yorki 5
BROKERAGE SERVICE
Specializing in Railroad Securities
Adams & Peck
63
2-1355
'
v
.
' T,
5
Tele. NY 1-1293
of
Collectivism and indi¬
Railroad Bonds
CHICAGO RAIL 5/27 25%
are
people who think of Fascism
the
"right"—the opposite of
some
early days as the bulwark of in¬
merge.
YORK 5, N. Y.
French
Wars
Philadelphia Telephone —
>.
TELETYPE NY -1-2155;
Lombard 9008
(
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4532
Volume 164
to
prepare;
the toll; of unpreparedness mounts hideously.
This
is
an
uncomfortable
of life is being
fought in every part of the world,
including the United States. The
war has made necessary and, be¬
yond that, has furnished an ex¬
cuse for the detailed control of the
lives of the citizens by the State.
Many people here and abroad are
trying to make that system perma¬
of economics and
others honestly believe
that is the way to a better life.
This latter group is impatient
fulfill
world
our
we
to
are
responsibilities
must continue to have a strong
we
Most important,
Army and Navy.
processes and believes the power
of
centralized
government can
if
Nevertheless
like.
of democratic
the slowness
demobilization. 4 But
war
military costs will be larger than
we like and will carry with them
continued taxes higher than we
for power;
with
labor.
flects
Some are acting from a lust
nent.
for the State, less freedom for the
individual in banking, in educa¬
thought, especially when we find
military expenditures listed at $18
billions
in
our
first
peacetime
budget. It does not have to be so
much regularly, for that still re¬
government and
philosophies of
need the
application of science
and careful thinking 16 tell ,us
what kind of Army and Navy, and
we
plan and provide the "better life"
more quickly. The evidence is to
the contrary.
For brief periods
dictatorships have shown material
gains. Pre-war Germany had no
unemployment, and the streets of
its cities were incredibly clean,
but-Hitler -and
Mussolini and
other despots before them failed
to find the secret of lasting prog¬
ress.
Human life is growth in
what kind of industrial organiza¬
tions
pared that others will not invite
If we are wise enough, and
war.
give the matter enough attention,
this can probably be done; and
done
without anoverwhelming
burden of expense and taxes,
i
We must also be strong in our
Called
a
in medicine, in
The best
visors of State Banks at its final
convention
Ohio,
by
the
is
world
marized in Hamlet where
is
man
advising
"This
all, to
true,
And it must
-
the
of
we
follow,
thine
the
year.
He
of
was
Association, and his
new
line for ad¬
Lynwood
K.
Elmore,
de¬
and
reelected Secretary.
are
those
tion
The
Treasury
Washington
any man.
has
that
at
course,
date
(including, of
that held in bank vaults
of member banks of the
Reserve
System)
was
Department in
issued its cus¬
Federal,
$28,447,643,-
163, as against $28,253,878,909 oi*
July
31,
on
1946,
Aug. 31,
and* $27,684,945,^
1945, and com¬
with $5,698,214,612 on Oct-
19?0.
Just
before'the
break of the first World
Money in Circulation ^
Thou canst not then be false to
of Aug. 31, 1946, and
mohey in circula¬
show that the
31,
the night
Banks '
agents. The figures this time'
pares
was
Federal Reserve
and
necticut,
own
held, in- the U. S. Treasury
by
663
■■!:^v ■""4■
as
money
puty Bank Commissioner of Con¬
day,
people get their satisfac¬ diplomacy. A helpful and impor¬
enduring progress, tant bill passed the Congress last
not by being done good to, but session" providing - for" better pay
and conditions of'work for our
by maknig their own choices and
carrying out their own plans and representatives abroad.This was
desires.. The Christian religion is essential iq fmairitaining a strong
clear on this point, "What shall it diplomacy. Another essential is a
continued strong public interest.
profit a man if he gain the whole
"Courant"
Hartford
vancement to the Presidency next
old
a younger one:
above
self be
Cleveland,
Sept. 20, it was reported
elevation puts him ifi
sum¬
an
in
previously Second Vice-President
;
•
,
thing after all that
for
do
can
,
on
the
session
Sept. 21, which added:
of individual in*
-
Rapport, Bank Com¬ ing the amount of money in cir¬
of
after
Connecticut, was culation
deducting
the
elected First Vice-President of the
National Association of Super¬
will resist the drift and restimu-
late the forces
itiative.
tomary monthly statement show¬
Supervisors Elect
Richard
missioner
by its real name,
drift towards totalitarian¬
ism, towards dictatorship. To stop
this drift, to preserve out great
heritage, will call for leadership
of the highest quality, very prac¬
tical, cracker-barrel leadership in
each community, leadership that
shall need to be so pre¬
we
in science,
tion,
this is
Bank
1811
is,
on
out¬
War, that
June 30, 1914, the total was
$3,459,434,174.
which
tions and make
■
here will
But, whatever the basic reasons,
battle is on.
The Socialist
Party in England is perpetuating
government controls; so also the
Communists
and
Socialists
in
France and other European coun¬
tries. The same conflict rages in
deliberately r
focused
into
only
and
slipping quietly
•
who don't understand
to
urging increased government
and
decreased human
are
neglect. /
^
the instruments of
work. We are dealing with
people we don't understand, and
college profes¬
our
from
peace
and even some of the clergy,
sors,
g*
in, making
radicals but many
educators, our public school
the recognized
teachers
•:-
Second, to our strength we must
add infinite patience and goodwill
China.
of our
.
iiidusfneslhrive where
,
these problems, to pre¬
on
them
vent
,
States not
*
I#
> But banking and
like ours must plan
to keep * pur eyes
other groups
the United
/V:'
v
help.
the
In
•
V
The sessions of the United Nations
soul?"
world but lose his own
••
prove
their
We have
us.
intentions by
good
our
reiteration
constant
and
controls
demonstration.' We must think of
freedom, as the way towards the
better life.
One sign of hope is
that; the
intelligent. American
to be
these
problems not as something
disposed of by passing a law
or concluding a treaty, but by the
patient, unending, tactful labor
over many years of the best of our
citizens
in
public and private
to the threat.
voter is waking up
We don't want Statism here, and
] beginning to see; with
the
struggle that
here and elsewhere. Our
are
we
clearer; eyes
goes on
people
that
beginning
are
have far
we
Third—and this is the most im¬
must put our own
and keep it that
way.
One needs to go abroad to
appreciate this country's unique
position. Literally the world looks
portant
the
away
as
thing which has made
great nation. : ~
:
very
lem
structure
of
world
to me
seems
be still
is
us
that
r"A
diate future
real
more
<
beginning to
about it.
First,
strong that > no
around and
we
we
one
we
we
behavior.
us
can
lot
it
to
or
do
are
is
to
war
but not
to
because
weak.
of
likes the words
for
as
world
take
they thought
the
Mechanical
same
wars
chance
take
a
again.
quered. They brought
ments
for
were con¬
men,
building homes and
Then factories
were
industries
paved the
thrived
towns,
way.
In the 13 great states
test
we
revitalize
served by Union
face
is
now
for
new
the
homes
expansion.
Union Pacific will continue
to serve
territory it pioneered, by provid¬
ing efficient, dependable, safe trans¬
over
the time-
saving Strategic Middle Route; 4
be
the
^ Union Pacific will gladly furnish con*
release the individual
efforts; that
we
"Pbcilic*
that
:
can
fidential information regarding avail¬
able industrial sites having trackage
facilities in the territory it serves. Ad¬
dress Industrial Dept., Union Pacific
Railroad, Omaha 2, Nebraska*
nation live by moral law and
by compulsion.
are
tional
each
•
Specific 'saH "Union
regimentations
•
'
today in danger of for¬
feiting something of
uv
room
portation for shippers
abandon
or
We have
relax the
creative
We
•
raised,
and industrial
railroads
be tilled,
be unearthed, livestock
to
built. And
where
be
to
imple¬
transportation for. marketing products.
minerals
without losing our balance;
we can
a
not
we
by'touch.' We cari't afford
can
war
that
we
'j; They*, were: wrong,
we
the highway to progress;
we
re¬
politics. Germany and Japan went
were'
frontiers
opportunity to show that freedom
push us
successful
western
to
,
democracy.
our
not, power still has a
with
V the
Pacific, there still is land
and restraint in our
greatest
whether
must keep so
"power politics," but whether
like
The
must do
shall command
None of
spect.
what
see
so
are
common sense
clearly the
problem it faces,
the obstacles
remove
preventing production
getting into high gear, man¬
age Purbudget' • and / our
debt
wisely, and exercise, all of us,
Just as-this country is begin¬
recognize
f
coming of the railroads,
from
What We Must Do About It
ning to
if
which
world moving away from sane co¬
operation, and not toward it.
affecting
other nation in the world.
such "calamity is * to be
averted, we must in the imme¬
the
see
we
without
here
"WTITH the
every
But
The thing that
American belief.
worries
It
more
deflation
a
That
peace.
We are set for
dangerous today. We
cannot have serious inflation and
fair statement of
a
bust.
it, just as after World War I.
philosophy, other nations
build
whether
is
economic prob¬
we
can avoid a
did great damage then and put the
world back on its heels. It would
why, no matter what their gov¬
to
power,
boom and va
Also, we do not see
us
a
lacks
the
our
An immediate
try to impose it on us or on any¬
with
From
our
freedom.
its
own problem.
We don't want it
here, and we don't want others to
work
faults and
great power in a nation that be¬
lieves in and practices individual
Collectivism for itself, that is
can't
before.
never
our
glow of our pros¬
and our skill.
It is a position of danger, danger
from
envy,
danger that power
will /.make
us
careless, danger
from the lack of thoughtful use of
perity,
If any nation wants Communism
or Fascism or any other form of
ernment
order
into
fade
v.'
body else.
us
distance
energies freely and vigorously. If
we ever lose that, we shall lose
the
in
to
mainlyf because we have had a
form
of ] government that ' lias
given ki individuals
and
pri vate
businesses a chance to use their
we
—
house
highest standard of living in the
world, not because we are smarter
than anybody else, and not just
because of natural resources, but
us a
r
'
realize
to
and
service.
our
great
heritage,* of*; freedom.
na/,
In
Community are' people about
good, intelligent, well-meaning
long time people who advocate more power
U N ION
PACI PIC-RA II ROAR
7fe
tfrafef/Z Mijy/e gwfe/
,
THE COMMERCIAL & FINANCIAL CHRONICLE
1812
then in the trough of the world's
procedure was discussed. Fiftytwo credit groups have been or¬
Other
people's money on visionary
b/t
Legislation
schemes.
May I refer again to the work
the
of
ganized for local areas. /More
than $600 millions are available in
said
a
these credit groups.
this
phase of
have made loans to
The groups
the
that
extent
made
been
But the
of
preponderance
great
made
the
since
have
deiharids
them.
upon
war
loans
ended have
been made by local banks or by
local banks and their correspond¬
ents working
together.
The credit group was
it should be.
not designed to
its
own
This is as
solicit business on
Its function is to
behalf.
Business
Small
Credit
moment ago*
the guide in
effort was the
resolution
of
1943
our
against the continuance in times
Of peace of the wartime govern¬
ment
guarantees ' of eommercial
and industrial loans by banks. Our
Work
has
been
informal.
both
Our
formal
and
banks
efforts
informal
in 1945 when the
new Congress convened.
At that
time there was no banking legis¬
lation pending. We wanted to ex¬
change views with members of the
and
business.
chairman
Results
;
V Through pubilicity and adver¬
tising at the local and national
levels which the Commission has
inspired banks to undertake, it is
how quite generally recognized
to all compe¬
that
banks extend
tent
people and firms necessary
business and production credit re¬
gardless of the size of the loan. On
Other
the
going
to
hand,
grant
banks
credit
are
not
for non¬
productive purposes or to encour¬
age
gamblers to take chances
with
the
of
committee
and
nearly all the members came. We
presented the story of the com¬
mission, why it was formed, what
it was doing, and what the banks
were doing about small business,
why we organized credit groups.
We
invited -questions
and got
plenty. As
hours'
several
run
Committee
discussion
we
past and present.
we
appeared before the
To all these committees
we
gave
the
Subsequently, we testified
before the Senate Banking- Com¬
the
Since
organization
of
have had
we
and in the Administration
to
do
with
having
and small
banking
business.
M
,
At the state level, we were glad
to
accept an invitation of the
Supervisors of State Banks to ap¬
.
pear. before their executive com¬
mittee in Washington hnd tell of
the
of our work. This
has been most helpful in
progress
group
every way.
came,
about
understanding in the event
that any bills in this field should
later come to the hearing stage.
Not long after these informal ses¬
bad our chance in a,
we
end
life two and
the
of
war,
Corporation
bill to extend its
a
half yeats/ We bp£
a half year ex¬
a
posed this two and
tension
in
both
Houses
of
Con¬
gress and asked that it be limited
to
We suggested
still on at the
that time, the matter could
one
only.
year
that if the
end of
war was
then be considered further.
The bill
finally passed gave
Corpora¬
as
the Smaller War Plants
tion
extension of one year and
an
half.
a
Such
the
was
showing
made by the
Corporation at hear¬
ings
committees
before
idea
of
continuing
of
Congress
the
its
life.
expressed
in
do the credit job for
ability
hearings, it
As
was
of
the
result
a
made pos¬
sible for the President to
abolish
the Smaller War Plants
Corpora¬
aftetlhe warended/The
tion soon
taxpayers were/ thus '/relieved of
the expense of one credit agency
that had ambitions to make itself
be placed in service next
between Chicago-Milwau¬
to
year
permanent.
Incorporating
materials
and
trains will be
many
unusual
devices, these
packed with fresh
ideas and conveniences for
coach and
In
designing and building
the Olympian Hiawathas,
The
Milwaukee JRoad
drawn upon
in
has
its long experience
operating transcontinental
sleeping car passen¬
gers. Work on the advancedtype trucks and car bodies is
nearing completion at The
and
super-speed trains. We are
Confident the new units will takd
Milwaukee
have made
Road's
modern
manufacturing plant at Mil¬
•
;
so
contributions
thany brilliant
to
rail progress.
banks
';m -••bb:b-*;"
.rrb by
businessmen in
Milwaukee Road
Only railroad all the
way
between Chicago and the
glad
citizen to
Pacific north coast
as
a
RFC
RFC
in
men
know
preferred
shall say
a
has
its
of
banker
on
it
a
good deal for them and their
y
>-y *
,
It may look like" an attractive
I
deal.
-
"Avoid
profits"—is
a
risks;
increase
-
seductive slo¬
very
gan. But every banker who sighs
this agreement IS playing irito'the:
banking. As William A. McDon¬
nell, chairman of the ABA Bank
Management.Commission, has-Sitwell said, "Herd W0 have-aii -op*
pprtunity to sell pp'r birthright fosr
bureaucrats.
have
Politicians
;
no
place
ih
b&nking, - whetheiK^ goYerhment
banking, private banking or char¬
banking.
Their* training
Service. This very definite convic¬
tion on my part accounts for my
a.xness of guarantee."
j ;
i If the/RFC shoiild: be^ success¬
ful in attaining its goal pf signing
pp
10,000
banks : tp its aiitomatic guarantee agreement, hPW*
long do you suppose the Ameri¬
.
Resignation: from the North Caro-
can
1 i
tinuing of chartered banking? The
only reason you and I have foif
agisting as bankers is that we ac¬
cept risks, appraise them intelli¬
gently, charge accordingly, and
committee
RFC
n a
months ago.
several
;
,
The
75%
automatic
blanket
guarantee agreement of the RFC,
which is being widely and in¬
sistently offered to banks, will do
greater
harm
to
banking, the
economy, and the taxpayer than
people will sanction the
set
up
them
we
proper
against
reserves
thus: insuring
make
them.
con¬
loans
our
/; When
as
get
away yfrom;^th^^l^ihcip^s/We,
have no- right to call ourselves
>
we
People think of this" agreement> as
respectable
financial - instru¬ bankersb
v. >;
b b<y
* * ;
ment because of the RFC's past
$; Benjamin Franklin opep";laid
record and sound judgment.
'£
that, those who give up essential
a
,
We have not previously stated
our
position. on this matter be¬
cause we had. hoped. that by the
,j
liberty in order ta secure a little
safety deserve neither liberty nor
Safety*/;?f.yyyy /:yyb-/
Next year Congress will hold
persuade the RFC that hearings, investigating//thee RFCf
its program is' superfluous and while
considering the question of
downlight evik/> ' V y;^-,b Whether-.-or .not' its; life should ibe,
of 5 negotiation/ we. should
process
'
be able to
■:
instrument
This
offered
1
to
extended.
Those
bankers
:
who
banks would automatically guar¬
are
antee them
making prof it out of it, should be
ready to defend it and themselves
with good answers, and
especially
be prepared on the point
of; the
against loss on 75% of
their risk on any loan up to $350*000
over
this
period up to 10 years.
a
'
,
had
and
as
I
a
.
/
many
employ—men
•
*
able
who
and
banking. A
still remain.. Nothing I
to you on this subject is
personal nature. In represent¬
your
the
corporation charges
Congress has not been • officially
of
aware
this
what
does the taxpayer
tential
on
using
this
instrument/and
means,
know what
nor
commission; however, I
disagreement with
express
and
^ ;/yyyy:
rower.
1
po¬
liability the RFC is putting
him.
•
It
significant. to hie that
was
Congress gave the RFC only 'six
months
to
live
after
the
Seriate
^appealing clever had first passed a bill extending
salesmanship can make this prop-: its life for five years/ It has been
osition appear. It is a sugar-coated my observation that the
present
deal
which looks quite attractive
Congress is not disposed to look
presented.
But. there. are With;'/favor b upoh^
certain ^implications • for/banking agencies
that
play
wild
and
and for ;the economy which ought loose with' government
funds/; /
to be pointed out.
We have pleaded with the pres¬
when /
,
It-may well be a violation of the
lending powers of the corporation
defined in the RFC Act of 1934.
ent
management/of
discontinue
the
the
RFC
automatic
to
guar¬
antee Jorthe following reaspns:,.:
\
1.
We believe it
wjil
encoiir-
age loose
lending practices and be
a/Contributing factor to credit -ittr
author¬
busi^. flation. Officials of the Federal
enterprise when capital or Reserve System have said that the
credit at prevailing rates for the banks, even without the use of
The corporation was1 then
ized -To mak^ loans to any
ness
character, of the loan
ls
applied foi¬
otherwise available." This
not
lending project goes far beyond
that. There is plenty of qualified
legal ; opinion,
this
in
country
large-scale pro¬
motion of credit extension to busi¬
which holds that
on
part of the RC even
the
by the indirect device of under¬
writing the loans of banks oiy a
mass
basis was not
authorized. %
This automatic blanket guaran¬
tee
arrangement does violence to
the spirit of
the legal limitations in
and state bank¬
both the Federal
ing' laws
bank
may
rower;
written
the amount that a
lend.to any one bor¬
on
These
into
limits were
laws for the
legal
the
Specific purpose of protecting de¬
positors of banks from the conse¬
The RFC was, as you all
know, quences ' of
excessive , lending.
a
product of the depression.
It While during the war the portion
was created to restore confidence
of war purpose loans guaranteed
and to inflate a deflated
economy bv the government was exempted
certain of their policies.
of federal
I realize how
ness
panic.
state RFC
my
;
business
number
time
serve
Committee.
'
the
the
of the stock reassured bankers and
must
b
sold
stock in critical depression
days.
The money derived from the sale
ing
Passenger Traffic Manager'
Union Station, Chicago 6, Illinois r
our/dealingsywith the
the past performance of the RFC
in depression and in war.
Many
of
have
number
Agencies, It is how dominated by
In- the first plafce there; is seri¬
doubt about the legality of it.
Reconstruction Finance Corpora¬
tion.
I do with a feeling of real
regret and deep concern. Every
citizen has a right tq be proud of
a
F. N. Hicks,
r.
to discuss
.The
distinguished -place among
the fleet of Hiawathas which
A
hands of the enemies of chartered
ous
In completing my discussion of
the Washington scene, I now wish
was
agreement/
it appears that the RFC has gone
the way of all governmental credit
now.
*
.Corporation
kee and Seattle-Tacoma.
this
signed under protest. Others have
signed without protest, thinking
possible violation
.
kee Road trains will be called,
agents of the
are
out calling on bankers
trying to .persuade ; them: to sign
State laws regarding the size loan
a bank can make to
any one bor¬
that
Reconstruction Finance
are
I know that field
RFC
to say that
,
sleeping
cars, including the nnique Skytop Lounge, is steadily' pro¬
gressing in the Pullman Shops.
job
and Ie~
effective,
the interest paid by the borrower.
of these
tion of thd all-room
through proper*
gal channels.
% of 1 % Which is deducted from
the postwar economy.
waukee, Wisconsin. Construc¬
It is
For
clear
bankers to
new
credit structure.
as
unnecessary as it is unsound
since the banking system
already
has the machinery to do the
Con¬
it
confidence
as
inflate the
com¬
made
Members
Thethese brand Hiawathas,
Olympian
Milwau¬
is
they
ho longer in Sympathy with
were
SiMMMlliiiors
there
to /whether the
of
mittees
*0111 i iicn tal
I am sorry
limits
as
that members of the
gress
the
there
we
the anything eveRz before> ^tempted/
War Plants
in with
came
beginning of our com¬
kept directors of the
RFC advised as to our policies and
progress.
They approved. How¬
ever;
those»" directors are 1 not
mission
legal
stockholders.-
y/
.
forg
hearing. Several months be¬
the
>
makes, them totally unfit for this
Most of the work in Washing¬
ton I have thus far related
.J
these
extension of
this exemption to
peacetime loans can be justified,
y It is an encouragement of loose
lending* and < its effect will be to
Since the
tered
Formal Legislative Work
.
Corporation.
op¬
portunity to tell its story directly
to nearly 100 leaders in Congress
After its depression or
job is done, the government
should abolish such agency just as
it did the
Smaller
War
Plants
this
an
a
bill.
war
:
Commission,
is
great depression or a
war.
Even then, it should lend
wisely and charge interest so that
the taxpayer does not have to foot
to do.
mittee.
Smaller
tra n
still
cuse
complete story of what the
banks were doing and were ready
fore
iiblill
repaid
bears good interest.. The pnly ex¬
the
ma!
in the making-
been
not
ness
sions
Now
has
War Mobilization and Conversion.
and
Later
in
I can find for government
being in the credit granting busi¬
the
:
which
invited to meet with the
were
while no legislation was
pending.
Our objective was to
lay a ground work of education
subject matter.
never*
tically all the money represented
by them has been repaid and that
our
impressed with the Congressmen,
their sincerity and their grasp of
We were greatly
from it, but
bor¬
Advisory Board of the Office of
we
had
the full gamut of bank credit
Banks
its history has the RFC had better
loans than these bank loans. Prac¬
on
Economic
Policy and
At . another time we
story to the House Select
Committee
to
Investigate ■■■ and
told
result, at the end of
a
Special
War
Planning.
took place early
the lending services
its. facilities come House; Hanking
Unci
Currency
into play when it is called upon
Committee, so we invited them to
by banks which first initiate the an
informal
discussion.
The
•supplement
bf
Post
serious question
depression,.
rowed money
Washington; As I Study Small Business. Still later
Commission in
Convention
House
from
greatest
Banks and Small Business
(Continued from page 1800)
correspondent institutions where
every
aspect of postwar credit
Thursday, Octbber 10, 1946
this
of
instrument, must be careful
credit
inflation.
ment with the RFC
another
This
agree¬
superimposes
inflation threat
those
on
We
already have. If the govern¬
ment is serious about the threat of
credit
inflation, it should discon¬
tinue the
of such devices.
use
b 2. y It throws
bility
on
the
an
V
b
-
additional lia¬
government
already
which
is
over-burdened
with
financial responsibilities and lia¬
bilities: y-y *... bbbb : bb y/'• '/:;/•
,
b 3/
If the. government is
going
three-fourths- of the
risks for bankers at a small
to
assume
fee,
why should it
not extend the prac¬
tice to retailers arid manufactur¬
ers, arid also
assume
of their risks?
.b 4. b The plan
three-fourths
Why not socialize
the whole economy?
y
-
v.
•.
was announced
r
v
,
fbr
the purpose of being of "assistance
business id
•td
reconverting from
<
.Volume
164
Number 4532
wartime to
a
peacetime
a
THE COMMERCIAL & FINANCIAL
CHRONICLE
econo¬
How Far Can We Protect the Investor?
my." Since reconversion has been
completed, the guarantee should
be withdrawn.
5.
'•>v
We question the
>
the RFC to
In
authority of
obligate itself.
so
closing,
I
promise you
the
continued service of this commis¬
sion in the
creasing
developing of ever-into meet the calls of
ways
business,
small
and
large,
that
to every bank in
every com¬
come
munity. I pledge you that it will
keep on-fighting this vicious RFC
automatic guarantee program and
other attempt of govern¬
ment agencies to foist similar de¬
every
vices
the
on
nation's
economy,
carrying the fight to Congress if
need
be.
tered
We
shall
keep
char¬
banking free. We shall meet
the
credit requirements of local
business and the nation's
business,
as well, and we shall
meet our ob¬
ligations
to
support freedom of
thought and freedom of action in
this great4 nation of
(Continued from
we
to
classify
past
^
|
.
Fiscal Tasks Ahead
page 1782)
constituting fraud.
as
In the exercise of broad discretion¬
must always be
ary
powers, care
taken by him to
position
is
He
to
ascertain
his
not
therefore,
and
care¬
support of
cially of the- payroll savings plan
and
other efforts of the*
savings
bond sales
group to absorb spend¬
able money
through the sale of
Series E bonds.
;
Interest .Rates
Let us turn now for a moment
to the subject of interest rates.
It
is sometimes urged that
Presumably
by
giving an investor
fully disclosing all
pertinent facts, favorable and un¬
favorable, the chance of fraud
a
prospectus
corporate
manage¬
he
have
an
mind, and that
open
is
That
Let
is
they affirma¬
tively pass upon securities are
careful to specify that such action
should not be construed
as
only
look
us
In
most
the
,
Most states when
«
or
that
disappear.
It
how
matter
no
questionable the security is, if the
investor has received a
copy of
he be reasonable and sound in his
conclusions.
diminish
argued
partial
a
at
the
cases
prospectus.
It
answer.
investor.
he
doesn't
is
security.
-
was
the prospectus and fails to read
it,
he is in no position
to-complain.
of
ment, and gazing into the crystal
ball. It is therefore important that
read
generally
an
purchasing
any
'■=
rightly regard the business
of
the
underwriter, dealer, or
broker
as
a
highly specialized
business. But the
business of in¬
vesting money, of buying securi¬
wisely, should require even
more specialized
knowledge. It is
ties
the
investor who
is the one who
the greater risk.
Yet, we
have these inexperienced invest¬
ors who
comprise the bulk of the
assumes
number
of
investors
buying
curities today.
of the market
They get in and
and have
a
only
at
the
se¬
out
wrong time
faint understand¬
ing of what they
Some
They want to make the most of
their
and
We
lengthy, oftentimes involved, and
hard to understand. In some in¬
stances I have had trouble under¬
.
are
doing.
investors, helped by
ex-
peri ence, have realized their own
limitations in the matter of buy¬
ing
securities
wisely,; Mutual
funds, or open-end
investment
opportunity
many
take
a
while it lasts,
short-sighted
view of the future. In the scramble
to
provide
offerings there
deterioration
in the quality of securities offered
and an increase in the offering
price. Questionable practices have
has
been
arisen.
a
new
gradual
While
there
have
been
good
offerings, there have r also
been
many
offerings on terms
grossly unfair to the investor; is¬
that should
sues
sold.
Can
we
have been
never
say
the investor is
properly protected if we merely
a prospectus?
I believe
ouf experience proves he is
not
properly protected thereby.
I think that state regulatory com¬
missions serve an extremely use¬
ful purpose at this critical time
by going beyond full disclosure,
and beyond, ascertaining whether
apparent fraud is present, to de¬
hand him
that
ap¬
standing the prospectus myself.
value, or The average investor, buys securi¬
worth of the security.. They real¬
ties^ not because he has carefully companies, emphasizing diversifi¬
ize that tlie; seller of; a security
and
considered ail .the facts, but be¬ cation
expert
supervision, termine whether the offering is
might use that as a sales argument; cause he has a
have capitalized on that fact. I be¬
vague, idea that it
fair, just, and equitable in all re¬
also that the purchaser of the se¬
is going up in price. He
usually lieve, in a great many instances
pf
the
merits,
law
program-espei-
fraud
functions
and is
urge your continued
the savings bond -
of
fully weigh all pertinent facts in
order to avoid being charged with
wet-nursing the investor, stifling
free enterprise, meddling with the
ply the few tests specified in the
helping to achieve a broader
distribution of the public debt. I
ity of enterprises, or of the degree
of risk assumed in
should
(Continued from page 1795)
mil be about $8,000,000,000 if the
present rate of sale continues.
This program is absorbing a con¬
siderable volume of funds which
would otherwise have been
spent,
the
an¬
Under the Common Law the
that
arbitrary or ill-considered or
prejudiced in his actions but be
diligent
experienced during
years provides an
two
swer.
should
insure
sound.
have
principal element
misrepresentation.
be
proval
ours.
'■»
...
1813
curity might otherwise charge the
securities administrator with a de¬
gree of responsibility he; obviously
bases this op something the dealer they offer a much better approach
to a reasonable solution to the
or salesman
av¬
may have said to him.
Even if he did read the
prospectus
erage
cannot assume. The securities ad¬
ministrator can, in effect, only ap¬
he
However, on the one hand, we
still have the great bulk of inex¬
at
the time he examines the
probably would still have only
faint idea
a
of
when
sumes
he
speaking, he is
application; he does not apply the period
of
the
a
risks
buys.
he
as¬
Generally
novice. In every
investor's problems.
perienced investors in the market
eagdl to; buy; any securities that
are
offered.
On
the
spects.
At the day of reckoning
inevitably follows any period
of great public stock speculation,
that
the securities administrator will be
held to
the
account by the
kind
cannot
and; the
of
look
public for
job he has done. He
to
the
underwriter
dealer to, apologize for
other hand, hirm
many other tests which an in vest
J- many newcomers, with no past in¬ we have the underwriters and
State
securities administrators
or could be expected to use in de¬
vesting experience; are attracted •dealers with a flood of new offer¬ all want the securities
industry
termining whether the security Even if a fraudulent or unfair ings*
corporate
financings • and to prosper,. Such prosperity de~
is a suitable investment.
practice were fiRly cdisclosed in
bail-puts. Only about 15% of the perids on the continuing confi¬
It might be asked "What need the prospectus it probably would
time does an" ideal situation exist dence of the investing public; ^ I
is there to protect investors ex¬ go unrecognized, if not unread.
for the dealers when securities can can think of no surer,way of de¬
Investors generally have no broad
stroying that confidence-than by
cept against fraud? " I believe that
background of investing experi¬ be sold with practically ho effort, selling the
public questionable br
the wave of stock speculation that
ence, no1 conception of the mortal¬ and money can be made so
easily. i; : %
great; market
activity
,
(Continued
on page
1814)
"
higher in¬
terest rates would aid in the
trol of
con¬
inflationary forces..
!
It is my .view that, forthe
pres¬
ent, no anti-inflationary purpose
would be served
terest rates.
ft <£>
MiMmu
by increasing in¬
This
is
because
it
would interfere with the stability
of
the
.and
government
bond
market
would
introduce uncertain
ties, which themselves might con¬
tribute to inflation. The immedi
ate effect of higher interest rates
might very well be to increase,
rather than to
decrease, the vol¬
ume
of
currency and
deposits.
This is because the typicalInvest
tor's reaction to the higher rates
might be "wait
andr
see," rather
than "run and invest."
,
The stability of the bond
market
since the end of the war has eased
the financial problems
of recon¬
version, both for the government
and for business firms. The sta
foility of the government bond
market results in a degree of bus
iness confidence which is of tre¬
mendous value in
FOR CHEMICAL MIRACLES
achieving and
maintaining full production.- It
contributes to the confidence ojf
the public in the credit
of the
,
United States
and in the
enduring
stability of the currency. Weinust
not impair this
confidence.
In closing, there
_
is
one
I would
More than
'
\
with
any
lems
can
best be met of
we
dis¬
Amer¬
heritage
of
achievement
accomplishment,
over
adversity,
our
of
ap¬
proach the future with confidence.
•
Not
because
the
path is easy,
but because we as Americans have
thrived and will thrive under con¬
ditions that call for extra effort
and
united
all Of
effort
on
the
US.
part of
v.;
i:,
I appreciate the
speak to you
tend
the
'
V 1 I
.
'
_
a
">
Score of Raw Materials Invite Chemical Industries
K '
sincere
<
•
t
-
•
U
V
'
'
#
t<
thanks
of
for the
the
of
"
>
as
in the,
a
variety of raw
fast-growing six-*
hydrocarbons.
industry produces economically and
profitably here, aided by skilled local labor, a plen¬
tiful
supply of water, and fast, cooperative trans¬
portation—not only to domestic markets, but to
world trade through great Gulf
ports near-by.
YOUR: INQUIRY
STRICTLY
CONFIDENTIAL
co¬
Development
Southern Lines,
:
Department,
Kansas
City
Building, Kansas City 6, Missouri.
economic
1
The chemical
City
•;
'
are
country, as" a vital and integrated
element in the nation's economic
structure, have, given to the concommon
,
City Southern linesby
Kansas
City Southern Lines. Among the metals and min¬
Antimony, Barite, Bauxite, Chalk, Clays, Coal, Dolomite,
Gypsum, Iron, Lead, Lignite, Limestone, Manganese, Marble, Mercury^
Phosphate, Salt, Silica, Shales, Slates, Sulphur, Titanium, Tripoli,Vanadium and Zinc. And with all these are great timber and
agricultural
resources for
chemurgy, an immense and unfailing
flow of natural gas, and the world's greatest oil
pro¬
duction and refining—suggesting chemical utilization
erals
operation which the banks of the
our
\ '
of Kansas
Address
quest%of
v(|
,
opportunity to
today.'. Again, I ex¬
Treasury Department
problems..
U
the-Territory Served
state area
today, but also
problem important in the
icans, all of us, remembering
»
materials for tomorrow's chemical miracles
you
formulation of a sound public
pol¬
icy. It is that all our major prob¬
>
Nowhere else in the United States is found such
thought
ble, not only to the problems
to
\
to
leave with you—so
gen¬
eral in its nature as to be
applica¬
cussed
1
•>V
Kansas
Southern
~
r.T
A
Kansas
City#
£0UTHERN
1814 V->.
THE COMMERCIAL & FINANCIAL CHRONICLE
''"'""V
: j
'
*
Radio: Past and Future
How Far Can We Protect the Investor?
(Continued from
,
excessively
sues.
priced
securities
is¬
'•
what
ways
can
■/>:
■.
securities
a
administrator properly go beyond
full disclosure and
apparent fraud,
into the realm of matters that tend
to work
a
just,
inequitable?
or
We
fraud
might
or are
unfair,
consider
chase warants
or
stock
un¬
pur¬
stock options to
underwriters or management
X
believe the securities administra¬
tors on May 25, 1945
a
performed
distinct service for the
investing
public and for the
securities
in¬
dustry itself, when they resolved
such
options
or > warrants
that
would be looked upon with
great
disfavor except in the unusual in¬
stances where
they
justified.
were
The inequities and abuses that so
often attend the issuance of
such
options and warrants are already
well
known to all of us. One
point
recently sought to be made in
justification of the issuance "of
warrants
to
underwriters in
porate financings
compensated
the
cor¬
that they
underwriter for
was
continuing to give the company
advice, counsel and assistance in
many ways. Even if we assume
that the underwriter is
qualified
by
a
aid
versatile staff to render such
and
advice,
the
value lof
such
well
extent
determined
be
services
and
could
not
beforehand
and in any case such value would
bear no relationship to the fluc¬
<
tuations in price of the
company's
stock. ■ ■ • r
?/:;■./??\
A recent
.
'• )'
^ j,
tendency has been for
existing stockholders
to issue and
sell warrants 4o underwriters in
connection with an
offering
stockholders'
the
moves
the
securities.
threat
of
stockholders'
as
to
whether
creasing
the
This
dilution
equity.
might possibly be
some
the
floating
in
of
There
of
supply
securities might hinder the
pany
of
re¬
question
threat
in¬
of
com¬
subsequent: corporate
a
offerings of the
same
issue. There
still would
remain the incentive
the part of the underwriter or
dealer to- stimulate
on
terest in the
the
price
for his
to
investor^ in¬
security — to boost
an
abnormal
own
level
gain, — without dis¬
closing his own position. On dhe
profit should be subject to
(Continued from page 1783)
<■•*"
by stockholders would seem sub-: careful scrutiny. Unless it can be made many outstanding contribu¬ services of - this era and compare,
stantially less objectionable than, clearly shown that there has been tions to the radio art and indus¬ them, as a candle to the electric
fortuitous
warrants issued by the company. a
purchase, or that try. Amohg my friends here are light, the horse-and-buggy to the
without
whose
en¬
We might consider the question something has been added, com¬ companions
automobile, the ocean liner to the
mensurate with the profit taken, couragement,
of offerings of stockholders' se¬
cooperation
and stratoliner.
1
, '
~
.
such ballooning would appear to counsel the problems encountered
Already, the electron tube re¬
curities, or as they have some¬
be unjustified. It would seem per¬ across
the decades would have sponds to our sense of toucb,
times
been
called,
"bail-outs".
to
consider the circum-r been far more difficult to solve. sound and
While there have been many of¬ tinent
sight.
We shall Team
stances surrounding the purchase, To all of you who are
present, how to make it respond also tcr
ferings of stockholders' securities
the
time
elapsed
and interim and to many others who cannot our sense of taste and smell. The
on terms that have been fair and
be with us tonight, I wish to ex¬ tireless workers of radio science
equitable, there have also been changes affecting the condition or
outlook
of
the
company,
the press my heartfelt thanks and ap¬ will produce a radio-mail system
quite a number that are open to
preciation.
that will be* inexpensive, secret
question. In many cases the com¬ change in management and capi¬
talization, and the fairness of the
and faster than any mail-carrying
Radio s Unending Evolution
mon
stock
of
a
company
is
owned by one family or a small price of the securities offered in
Portable com¬
Forty years ago, radio was so plane can travel.
comparison with others in the
munication
instruments
will
be
group. An offering is made of a
young, that even a boy of 15 soon
same
industry.
.'■?! felt that he was a
minority interest, often up to as
veteran. As one developed that will enable an in¬
There are of course many other
dividual to communicate directly
much as one-half of the stock.
of the youngsters within whose
factors that a regulatory securimind and heart the spark of wire- and promptly with anyone, anyGenerally, the sellers can assign
ties
administrator
can
properly .ess
valid reasons on their part for
kindle? a great enthusiasm, i ]
consider such as excessive price,
must confess that even now as
disposing of a portion of their
more^.about__the; secrets_ °f_ spac^
excessive
we
shall immeasurably increase
discount,
unconscion¬
stock.
ook ahead I feel very little
On
the
other
hand
the
older,'
the number of usuable frequen¬
ably high salaries, lack of proper for radio
public is offered a minority in¬
today appears no less
terest in a small company, often voting power in Preferred and filled with opportunity for growth cies until we are able to assign
Common Stock, the syphoning of
separate frequency to an in¬
than it was in
in a distant state, at a high price.
the early days
profits in devious ways, and so when dots and dashes were music dividual as a separate telephone
The- sellers who have
built up
number is assigned to each instru¬
on. I shall not take the time to
to a young man's ears.
the company and know its affairs
We were
ment.
go into them here.
and
only on the threshold - in 1906.
prospects
intimately have
These
are
all
matters
with Great
progress ha§ been achieved,
picked this as the most opportune
New Weapons in War
which the securities administrator but as science measures
time to sell their stock at an ad¬
time, we
Science is continually at - work
of a regulatory state may properly have witnessed
only the begin¬
vantageous price. The invester,
to produce new discoveries and
concern 1 himself
in these times. ning.
We are still pioneering in
who
cannot
possibly know as
new
engineering
developments.
While the conclusions
reached the dawn of the Radio
much about the company, is asked
Age.
But we must bear in mind th?t
may not be the same in all states,
Forty years from now the in¬
to buy. The sellers, who stfll re¬
our
destiny is linked not alone
a sincere attempt at their solution
struments
of
radio
which
we
tain control, may have the com¬
cannot
help but work for the marvel at today will be museum with advances of technology but
pany tied down to long-term em¬
also with the further development
betterment of securities adminis¬ pieces,
along with the coherer,
ployment contracts at high salar¬
tration and the securities industry. the
crystal detector, the head¬ of; society, : Unfortunately; new
ies, rent agreements with real es¬
forces, are
being
released
by
The adequate protection of in¬ phones and the spark gaps.
Long
tate
holding
companies
which
science which threaten to bring
vestors, however, depends on the waves fascinated us in 1906; so
they own privately, etc. The pub¬
an qbrupt end to all progress un¬
efforts of both the securities ad
did the sparks that crashed noisily
lic, being in a minority position,
less they are properly
ministrators and the securities in¬ across
the
controlled
gaps.
Now
micro¬
may
be unable to compel the
and usefully applied.
In radio,
dustry. I believe that the industry waves, akin to light and generated
company to terminate or change
we have met the challenge of the
is today faced with an important in silence by electron tubes, are
such
contracts
if
they become
electron and have harnessed it.
burdensome. It is esential that problem. It has had the trust and leading radio to triumphs in com¬ Now we
must meet the challenge
confidence of investors who-do munication undreamed of in the
such
stockholder
offerings
be
of the atom, which has split open
not generally consider that they beginning.
examined closely to make certain
The pace of science has been a new-era—the Atomic Age!
are dealing
at arms' length with
that they are fair, just and equit¬
Only three weeks ago I re¬
its members, but instead look to swift and the challenge to the new
able.
them for counsel and guidance in art has .been great. That pace will turned from the grim and . un¬
f.
"Vendor's Profits"
investment matters. It can readily be swifter and the challenge still healed battlegrounds of Europe. ?
During the past 2 years there dissipate that trust and confidence gpeater.as the future unfolds. Be¬ ThereC amid misery and stiH-
) whole,
1813)
page
.
In
Thursday, October 10, 1946
i
•
however,
warrants issued
such
;
.
11
w^ere ^J:^%^ori^' fkS
.
have been
a
number of offerings
with so-called "vendor's profits?.
These have usually involved the
purchase of
a business, or all the
outstanding stock of a company
by one or more underwriters and
others, with a view of effecting
a
up
recapitalization or stock splitand a subsequent public of¬
fering at
a
substantial profit. Any
smoldering ruins,
by avoiding responsibility and by cause the .wireless pioneers pos¬
continuing the marketing in a sessed faith- and Vision, and be¬
large part of*questionable or ex¬
cessively
priced
offerings.
It
is
only by recognizingr^md assuming
a greater degree of responsibility
for the investor's welfare that that
confidence
sound
can
future
industry.
be retted5 ar*«L&,
achieved
■"
of wireless
romance
watts
25575*
with
dread
one
feels acutely
which
mankind
was
.
•'
the
nervously contemplates the threat
so powerful within
them, a vast of,biologicalwarfare, - atomic
bombs and i guided missiles with
new industry has been built, prpr
vidirig employment for hundreds war-heads pointed - toward death
and devastation;
Within the past *
of thousands, of>people, while mil
lions.jenjoy the services .that radio few months "ghost bombs" have
been reported flying over Sweden^
brings to themv;?r:
,*. ? America,' radio has grown .They are said to* emanate from* a d
miles " away.' ? Their
rapidly as a great public servant, point f 500
not only because of freedom-^to course is guided and controlled
from that distance. Some observers
speak" and'" freedom..to ..listen but
"because of the freedom of science believe they are self-destroying
to advance. Science must be free. and during their flight overland
course
is ; automatically
We can permit no restrictions to their
be*- placed
upon
the
scientists' changed so they will fall into the
the
cause
.
..
right
and
to
question,
think.
to
experiment
to
Because
America
held liberty above all else,
distinguished men of science have
come here to live, to work and to
seek nfew knowledge. The world
has
,
has
the
been
science
has
benefactor
moved
and
forward.
Radio
has
never
South Pacific cast ominous shad¬
ows
on
We
the horizon of the future. 1
witnessed
have
the
<
mere
•
push-buttom war¬
fare controlled by the long-range
electronic fingers of radio.
Only
recently two pilotless Flying Fort¬
stir
resses were
it must continue to dare the im¬
possible in peace if a
Kis to permeate society.
and leave no clue as to their
composition or construction. These
pilotless missiles streaking across
the European sky. and the atomic
bombs recently exploded in the
In
science dares the impossible;
war,
sea
fuller life
ceased
to
the imagination; it has continually
beginning
California
darkness,
flown from Hawaii to
through daylight and
through clear.- weather
That is why
It has met and fog, under the radio control
In war, they
the challenges of two World Wars of a mother plane.
have carried bombs or
and of the 20 years of peace that might
intervened.
:. :
--i-gwi;
'?• germs. At the Bikini "Operations
;, Radio
has become one'of the Crossroads,? radio &nd television
world's great social forces; it edu-r controls were much in evidence
cates, informs and entertains. Dis¬ as indications of* what may be ex¬
tance has been annihilated.
All pected in p future war.
Let us not be complacenLin the
people have been; brought within
tlie> sounds of
single' voice; ■) A thought that we .in America are
inspired
research..
of
,
.
is always new.
radio
••
•
<
-
9Twor'd; message -has encircled the
in 9 seconds!
earth
the
moon-
has
.-
The face of
felt the ping
of
pulse and echoed it back in
predictions of
interplanetary communications.
evolution
of
radio
is
un¬
ending.
It has produced tele¬
vision, radar and a host of other
electronic
We
still.
devices
can
and
foresee
services.
so
many
changes that those who follow us
may wonder how we of this gen¬
eration
were
satisfied
to
talk
around the world and not to see
at the
will
same
look
time. Our descendents
back
upon
the
escaped
amended.
radar
2 seconds to revive
The
safe from,
radio
Pacific
destruction because
invasion in the
The
Atlantic
war
and
we
just
the
more protection to
today than is the
English Channel 'tovthe British.
Isles.
Pilotless planes and rockets
flying 6,000 miles an hour in the
stratosphere can carry explosives,
poisons or germs half way around
the globe to wipe out entire cities
in a deluge of radio-activity, fire,
mist, dust, debris and disease.
>
It is frightening to recall that
our
are
no
country
not a single V-2 rocket aimed at
England during World War II was
shot down. But even if new tech-
r
1815
niques could be devised tc^ ex¬
plode flying bombs in space, some
•
of them
.Qnly
surely would get through.
few would be necessary
a
to ignite and to rip asunder
great
cities.
Furthermore, there could
little
be
protection' against atom
•:.V; time-bombs that might be smug¬
gled into a country by saboteurs
p ^who would plant
them
in
stra-
tdgic spots, to explore, at the
(enemy's will by a touch of his
distant finger. .p, .
,
.
..
p> pv'What defense
against
an
,
devise
man
can
unseen
enemy' waging
(war in this way?; What defense is
there against a lurid streak across
the sky—faster
than sound, as
sinister
death
as
itself?
That
is
'
pthe question anxious
people ask
in every quartet of the globe. I
do
not
pretend to know
an¬
in discussions with noted
rope and
of
men
■
the
On my travels through Eu¬
swer.
science
home
at
and
abroad,, I have found scant hope
that any
has the
one
than
like to admit. (Achieve¬
we
mother of
cial
science
a
ited radius.
v.
as
has taught
that
us
Many
rather
than
ppP.y -v:'(
will risk their lives
scientific problem; few
a
risk
their comfort
ity to solve
universal
problem.
surpasses
social
a
or
That kind
>
science which he seeks to control.
He must think not only of him¬
self but also of his neighbors.
He
recognize the fact that mod¬
must
science has shrunk the world
ern
into
neighborhood. Now
one
than
Often, weakness is associated with
fear, and fear is not an attribute
of his fate.
ons
and brotherhood.
peace
This
nation must be strong morally and
habilitate
a
world
suffering from
the vicious aftermath of
With
must
of lead¬
within
prove
the
The frightening weap¬
his
grasp
may
yet
prime
for
influence
and
courage
to
see
ceasing
it
that
vision,
there
exploration
must
man
bring to these problems
we
is
un¬
Friends,
as
we
look
ahead
through the vista of science with
its
ership calls for
more
than
the physical
mere
not
only
in
sciences, but also in
tremendous
progress
the
.
,(•(/'
,
*'
'
\
,
"'l A"
}-C
r\r,<
lt
\
>
*
' -1
1
1 t'i
•
-
'
'
'
'
'• Despite the fact that the handi¬
;
works of science are at
stake, the
scientist has little to say on > how
discOveries ;ar^ inventions:hrbr
(to be used.
Inherently, he is a
large or# small,
CJ
;
of peace, but the^ products, of
his genius are often put to uses
far
afield
from
his
original
man
jr
,
peace
scientists
p v to. i; the
(' power
\
,
p thoughts and motives.
'If
I //y
is the chosen .course,
can (turn
their attention
development
of
atomic
for^indusjxy iand 'the
( quest of disease.
con-
We would then
Pphear less df biological warfare .and
of new triumphs:-over
; that
have plagued
more
.
eases
the
across
dis¬
man
centuries,
destroying
him,in greater'numbers rthah" war
^
itself. The warlike idea that
opean.
currents
could
-w
v
warm
shifted
be
by science to turn fertile lands
(into deserts might be-reversed in
.peacetime to modifyor divert
these currents to influence cliniate so that deserts would become
y
gardens. With the aid of nuclear
pbwer plants desert areas might
.( be transformed .into habitable and
productive regions.
There
(that
•
is
even
the-
possibility
of man's greatest
one
enig¬
weather—may some day
be controlled.
One of our noted
.iiien of sdence recently told me
rw™u,.ynj
mas—the
,
*
t„
THESE 7 BASIC BANKING JOBS
rWWHW1
.
j
ALL HANDLED ON 1 MACHINE!
;
;that his studies, of the' problem
p jnbt only suggest this (possibility
but that experiments are
actually
r.
>
•
under way that may lead to man's
dominion over the elements, For
S
-
he may*
^
ize
a
discovephow to neutral-
storm
or
„course.
*
,
>
Automatic
-f
detour it from its
Posting
i;
radio
weather
sta-
•p
tions in remote places in
the polar
j ■ ^regions, sift vdbsertSv in jungles and
p- on the seas can collect and broadv
.,
.
any
type of mortgage records
0
w
c
Writing 'Wecjcsiandiposting related(
•
g
*
0 Posting trust ledgers
-
„
Posting loan and disco
0
.
,
:
Posting depositors] accounts
0
(p ^ample,-man ;may learn >how to
deflect air; movements with conf- sequent changes in weather and
;
roll records
pay
.
Postihgltie general ledger
"
^'"'1
P
'(
i*T" * *'
^"
# Posting daily statement of condition ;
.
-
:S; cast
weather data.
Already radar
spots a hurricane, peers into its
;p;vbrtex, .plots its movement and
photographs it from, minuted to
p-
'
(minute. Radio-controlled and elec¬
tronically-equipped
permit
exploration
atmosphere.
rockets
of
the
will
upper
Within minutes
new
p. electronic computing devices can
p. analyze such
information on a
j,
global basis.
'
y.p
In
pi
.
pWe
may yet have rain
shine by pressing radio
1'
bars
\tf'~
*
accurate
four
<
,
measure
for
the
present realities.
And predictions
that one might make
today are
likely to miss the mark of 1986.
both
are
"
X
"''-U
.
,V%
-h-f .->v;''t-:-'
simply lift off and
-
•*'
one, or more,
of these specific jobs.
•
In every case,,
the National Multiple-Duty Ac-
countingMachine helps you to speed production and
reduce
errors—as
will
any
of the
National machines and systems
catches,
snap on—no screws,
\"
progress
and
dependent
cn
find'it useful every
■
*•
v'
>■»>'*.'•'
v1
fu-
Most of the predictions of
decades ago fall short of
Scientific
i', /'
1
(
other
many
expressly designed
:(
fittings to fuss with. Even the smallest bank will
or
always
ture.
"•
for bank
use.
Call your
local representative,
or
shape of things to
in the next 40 years?
The
answer
is
difficult because the
yardstick of the past is not
an
"Vi.v
another in amatter ofseconds. Its removable form-
to
come
p.
.f
con¬
the internationalist.
the
<
ad&untihg jobs listed. Itcan be changed from one job
Looking Ahead 40 Years
What is
sbgle National Multiple-Duty *
a
'
Accounting Machine handles all 7 of the basic bank
trol will have to be
vested.
Here
is a poser for the
isolationist and
a poem for
'*
i
When that day
comes, we shall
need, a-World Weather Bureau in
which global
;
small bank,
l
or. sunbuttons!
forecasting and
^
-•
,
t
..
'.•
\*
V1-'..."
•
-
a,
••:
/if.
'.'J\
:v:v.r
■
■
may
:.
write to The National Cash Register
Company,
;''(.
large,,bank, separate National Multiple-Duty Act
(counting Machines
'•
hour of the banking day. In
./W.V.V
Dayton 9, Ohio. Offices in principal cities.
each be assigned to handle
'■
•
' V-
,
"■■■
'
''
■
prophecy
the fertil¬
ity of the imagination, and our
imaginations
are
more
limited
that
also his heart and his soul.
war.
.
answer
more
must be the master
ever man
possibilities for
in peacetime, let us not
political and social sciences. feel that we are looking beyond
exercise of authority; it calls for
a few years
Only upon these forces can world the horizon of hope, The outlook
ago the elusive radio
imagination,; initiative, direction unity be built and
echo seemed a scientific., fantasy,
peace be main¬ is not discouraging, for there is no
"and guidance; People
everywhere tained.
yet from it came radar, when war¬
('.-J
■
limit to man's ingenuity and no
time events called for. it.
cry for such leadership.
Man must learn to control him¬ end to the
Upon it
opportunities for prog¬
.Necessity;; is credited as; the depends^ the future of democracy, self (as well
as the new forces of ress;;
trivial may become of utmost sig¬
nificance in the years ahead.
Only
adequate defense against the new
weapons of war that are capable
of mass destruction on a world¬
wide scale.
;
,(
secur¬
Therefore, the most im¬
leaders.
freedom
peace.
physically, not alone for its secur¬ will move him to concentrate on
ity but also for the accomplish¬ the problems of peace.
But to
ment of its task in
helping to re¬ achieve the blessings of peace,
political
or
tion of courageous, competent and
wise
our
solidarity of
But
if
opportunity is to be
turned to good purpose, our coun¬
try must be strong.
The world
has little respect for weakness.
portant problem of all is the selec¬
,
preservation of
of
V
men
to solve
will
as-radio,
prophecy. There
will be many.; events and
many
discoveries
to
change- radically
anything that we foresee.; An pb?s
servation which today may seem
reality
political
Unfortunately, in the
social and political spheres our
imaginations cover a rather lim¬
broadcasting, undreamed
of 40 years ago,
and
technical.
generation to imagine world-wide
television 40 years hence. ^Inter¬
in
and the
invention, largely be^
events, often demand or
force changes.
The most difficult
problems facing mankind are so¬
in the past, yet it is not difficult
for even the middle-aged of this-
national
the
cause
ment, however, is born and fos¬
tered by vision and
imagination.
Many great inventions have been
made by young men .endowed with
future-mindedness.
Although
youth lives in,the'future and.age
m*
.
> 1*
Akll
'
'«
•
■
•
•'
«
'l1
'
^ '
I
1816
''**
'
>
'/
"*
'
'
iy'
*
"J.
I
' ■•y 1
'
•?
•'!
£
|>4 1 ' ' ■ '
«|»
'!
corporations as a whole,
Bull
ni
;\U:[
Bear Market?
or
1%
couldn't
cities
port
"bears'*
Russia
help
be
but
during that period. Thus
certain
and
leaders
labor
primarily responsible for the
tremendous recent market losses.
are
Of course, , the thinness of the
stock market has been a factor in
situation.
check
on
you
give
your
He
stock;
but,
around
for
does
Dividend
is
entirely
buy the
must
hunt
not
rather,
someone
else
to
In
In
buy
July 1946
Publicly reported cash dividend
munistic
ble
scare
with
year,
the
Com¬
to
$393,100,000
this
compared with $347,100,000
in; 1945.
there is the possi¬
of
certain
large
cities.
World War II
'..
For
July
Depart¬
of
announcement
added:
could
easily
be
reopened
by
England.
Yet
our
government
Commerce
The
ment's'
bombing
American
Sept. 6
welfare
the
three
months
ended
31,
could
year
not
American
exist
were
considerable variation.
not
consumer
36%
a
was
increase in
payments
by
cor¬
(Continued from page 1780) I
mand for mortgage money
^
porate
N. Y.
and
Savings Loan
of
8.1%
as
of Jan.
1,
of $728,848,-
Executive
League
the
period
as
period
same
and
Sayings
of
gaged
eise to. On the other
hand, 1 be¬
lieve that the investor in Ameri¬
in
industry
is entitled to as
protection as the man who
invests in a farm, a home or de¬
compared
with
same
a year ago, were:
likewise
During the bank panic,
number of
banks in this
closed.
most
In
cases
date of
a
large
a
have undoubtedly
est
Loan
to
during
paid
period
by
in
point on short-term rates, and
probably passed the lowest
resources was
than the increase shown
associations for
was
the
the
during
three
and thereby es¬
higher rate to fight the
inflation, there is the
little matter of a public debt of
a
$264 billion dollars on which
interest must be paid. They have
some
not yet
figured out
where¬
a way
1.5% less
by they can increase other rates
for these
the rates
the same period
on
their
own
that recorded
comparable 1945
of
interest
differentiated
a
The
.
be
These will now
ered one by one.
As
well
is
on
gages
activi¬
has
a
.
Machinery and Accessories
the volume of new mort¬
and the safety of existing
are
"solved"
increases, we stand a very
good chance of having a "boom
and bust" type of economic purge.
On the other hand, if prices can be
stabilized around present levels
for six or seven
LAUNDRY
months, produc¬
tion, which is now
ly
EQUIPMENT DIVISION
to
"roll,"
beginning real¬
We then could
look forward to a fairly
DIVISION
prolonged
period of good business with slow¬
ly declining prices.
4 4 •
\
MACHINERY DIVISION
:
Mortgage lenders should ponder
well the two alternatives facing
•
-
*'
America—boom and sharply lower
stabilization and slowly
declining prices. They both have
one
thing' in
common—lower
prices. - And, it anyone is relying
on inflation to justify some of the
present
valuations,
he
should
ponder the following straws in the
wind: (1) Inventories at the end
of July had reached the all-time
record high of $30 billion, with inprices,
The youngest Division of this company has been
producing
oldest,
for
for
industry
one
for
hundred
twenty
and
years;
twenty
Now*
which
these readjustments,
will
are
inevitable in many in¬
dustries, cause wild inflation—in¬
flation such as they have had in?;
pengoes
the
years.
.
of
end
•
have
to get one: dollar- at > •
July? f And, ? if,j we
an
attack of infla¬
or
ventories
is no
learn that the stock market
•
:
with the idea that it is a
hr some * lines
.as.highas^O^^mpnlh.,
jumping
When
inflation.
learn better, such
real
estate will hang over the market.
people
greatly
the
Furthermore,
burden
creased
tax
because
of much
in- -4
Federal,
—
higher military
and
and civilian expenditures;
State, because of higher prices
assumption of increased so-
and
cial
responsibilities
—
which
?
we
will have in the atomic armament
ahead,
days
race
will
weigh
heavily on real estate. The crush- ■
ing character of this tax burden
is not yet realized because of easy
dare not
■
lenders*
underestimate it. 4-4'4 4..;;
conditions,
money
should remove the
threat of inflation.
DIVISION
DIVISION
granting
by
wage
UNITED STATES GAUGE DIVISION
-TROUT''^MINING
overdue.
Readjustments and Inflation
chased
els; but the outlook is uncertain.
If the current labor difficulties set
off a nationwide wave of strikes
which
i"'■!
seems
rate of
hedge 4 against
controlling
currently at peacetime record lev¬
TROY
deficit of $18,652,000.
a
Obviously, excess capacity, high¬
er rates and deficits do not make
sense!
Economic
readjustment
deal of real estate has been pur- ;;
mortgages, so, it will be consid¬
ered first.
Business activity is
CENTRIFUGAL
have
*
would still
consid¬ hedge against inflation. A great
known, the
business activity
effect
TOLHURST
the New York Central
question of the safety of tion, would real estate be a hedge 4
Well, the American f
brings up many, against it?
other factors because of the people have just paid millions to
ty.
BROADWAY, NEW YORK CITY
MACHINE
and,
should
interrelations of economic
VENTILATING
freight rates are not raised—
further, that even if rates
were
raised the 25% requested,
ent
mortgage
many
RIEHLE TESTING
of
deficit
a
000
the
DeBOTHEZAT
anticipated
nearly $69 million in 1947 if pres¬
Hungary where it took 5,000,000,-
m
Industrial
he
that
the
American Machine and Metals, Inc.
<
by the air transport
industry: "By 1947, the passenger
capacity * of the airlines will be
equal to that of the railroads in ;
1941?' As if that were not enough '
bad news for the railroads, the
President of the New York Cen¬
tral later in the week notified the
Interstate Commerce Commission!
rate is solved—and no solution is
Question of Risks
Manufacturers of
soon
possible.. Clearly,
in sight now.
-
233
war as
were-v
as
newspapers
as
lem
facilities
plant
after the
borrowing.
I said before, there will not
be any consequential increase of
rates—at least, not until the prob¬
So,
of
planned for completion
and, at the same time, keep down
"v
period."
And,
of
forces
of
manufacturing
deposits
tablish
28.7% greater than
,
rate.
interest
while the Treasury would like to
reduce
the increase in savings
"While
and loan
the
controls
this
dividend declaration by
Dividends
month
was
a
passed the low¬
have
1945, the increase in savings
change in the
for. the first half of 1946 was
large railroad company.
country
there
due
a
True, we
have firmed somewhat.
period from a total of $631,-
were
railroad
largely
Protect Small Investors
f
communications
amounted to 9%. The decline
bank.
as a
point on long-term rates. Never¬
League's " announcement theless, do not expect very much
in the way of an increase.
The
"Savings in these institutions plain fact is that the government
industry was the
only
non-manufacturing
group
registering
a
decline,
which
much
True,
went on to say:
increased
of
increase
an
production facilities are adequate.
(4) As a specific illustration of
overproductive capacity in one
field, consider the following state¬
ment
recently released
to the
in¬
result of
this new Treasury policy, rates,
particularly in the money market,
Vice-
:
60%. An additional $4.6 bil-.
lion
Associations.
unchanged.
The
$23,505,000,000,
some
terest rates.
President of the New York State
:
on
June, 1944, this was expanded by
both of which tend to tighten
1946 to $788,-
ing to figures issued by Zebulon
Woodard,
the
banking
the
in
people
000,000 in production facilities of •
all
kinds.
From
July
1940 to
over
as
our
banks, and hopes to reduce depos¬
its still further by shifting bonds
from banks to non-bank hands,
$59,158,-
006,973 on June 30, 1946, accord¬
V.
long
so
75% of
True, the Treasury is presently
engaged in reducing deposits by
redeeming obligations held by the
during the first half of 1946,
from total resources
214
or
months of unemployment will put
of
system.
the State of New
York increased
again
remain
crease,
of savings and loan
Resources
invested
be
can
over
holding
bonds, which gave rise to the in¬
Associations Resources
associations
before the
did
we
enormous
uals—and
,
a
,
relief! (3)
liquid funds is in the hands of the: Or, consider the fact that in 1939,
public—corporations and individr before the war, we had .$39,588,This
war.
steel, up 2%.
groups
month
goods would
than
culation
only corporate group to increase
its dividend payments was iron
I
posits his money in
inventory., boom 4;
end,; of the
approaches.; (2) Consider, in con- 4
;
were it not for small
miscellaneous, up 17%; mining, up 490,900 on Jan. 1, 1946 to $692,despise speculation, I 16%; finance, up 10%, and heat, 904,791 representing an increase
myself have never bought a share
light and power, up 7%." Divi¬ of $61,413,891 or 9.7% for the
of stock on
margin, or on bor¬ dends paid by corporations en¬
rowed money, or advised
period.
anyone
can
the
most
be available
.investors.
in the
future, if the boom does not
near
The
non-manufacturing cor¬
showing gains in
dividend payments for the three
investors; there would be
employment were it not for
small
investors;
and
certainly
few
dividend
Other
for
small
no
very
Thursday, October 10, 194$
Mortgage Investment ?
their-dividend payments
between 13 and 21%.
'
porations engaged in trade.
industry
it
ago
cash
legitimate service; the
of the country depends
a
them.
(
^
last
subdivisions
-
upon
1 ■
^
increased
creased
759
•
1946, dividends totaled
gives no protection to investors $1,024,300,000, a rise of 5.4% from
against such a catastrophe. With the $972,100,000 total in the cor¬
this additional unjust condition, responding months of 1945.
The
the handicap to
legitimate in¬ most outstanding gain for the
three month period of
1946 as
vestors, is intensified,
v <
I insist that most investors are compared with the same period a
rendering
/•
period
Paper and printing, other manu¬
factures, textiles and leather, and
oil refining corporations each in¬
amounted
once.
connection
(
Payments
your stock.
Moreover, under the
payments by corporations in the
present unfair rulings of the Fed-1
United States were 13.3% higher
era! Reserve Board, the broker
in July of this year than they
must find a man with ready cash
were
in the same month a year
to buy your stock. This is a rule
ago, the Department of Commerce
that does not apply to selling any¬
said on Sept. 6. July payments
thing else. This ruling should be
amended at
',
•
,
order to sell
an
situation
1'
-
a
but when
money;
broker
a
the
different.
draw
you
bank, you immedi¬
your
ately get
stocks,
When
(1
On the other hand, payments by collapse, but the supply of capital junction with the foregoing that a ,
Federal.* Reserve
Board
metal industries declined. and credit seems more than ade¬ recent
Companies
in the automobile, quate for any foreseeable de¬ analysisrof a National .Survey of ; t4
transportation
equipment, non- mands. There may be a slight Liquid Assets made by the United '
States Department of Agriculture,,
In the interests of a better Amer¬ ferrous metals and in both the firming of, the rates, but, in gen¬
electrical and non-electrical ma¬ eral, it will not amount to very showed that "Total asset holdings
ica, why shouldn't Congress pro¬
of
three-fourths
of
the
people .
groups
either reduced much. On the supply side, the im¬
tect small investors with a similar chinery
amounted to less than one-fifth of
floor?
their dividend rates or made no portant thing to remember is our
their annual income.", In other
war
created legacy of bank de¬
common stock disbursements, the
disregarding
unemploy¬
posits and money in circulation. words,
declines ranging from 4 to 24%.
ment
insurance
and
assistance
Today,, we have some $100 billion
from relatives
and
friends, 2.4
Among the metal industries, the more deposits and currency in cir¬
law insuring bank
Investors Necessary to American deposits up to $5,000, or rather,
■'
putting a floor under such losses.
7;;:/ /
- Industry
gress passed a
the
same
but among the
there was
heed for them to
close, but for
various reasons—some political—
they were forced to close. Mil¬
lions
of people
lost billions of
dollars — mostly
unnecessarily.
After this unfortunate event, Con¬
no
the other large sea¬
or
the
over
year,
(Continued from page 1783)
New York
^'
>, , V
COMMERCIAL & FINANCIAL CHRONICLE
THE
but
Effect of New Construction
!
Let
us
now
turn
struction outlook.
the
affects
tion
to
the
construc¬
safety
of mort«#
because it has an important
influence on the value of exist¬
gages
ing
H
con-
New
buildings. New construction
important from the stand-
is also
point of ability to pay interest on
existing mortgages because, under
normal conditions, we cannot have
|;
,
•
»
v
f f
i ?
.
j f
j
:
4;
*
prosperity in the United States *:•
unless construction is in
ume.v
1
good vol/
[ ;j
ii
r
i
4
I The inability of the construction u
industry to get into, high level ,
;;
j
«
jj
4
t
production, is an old , story to all
of you. Antiquated methods, low
r
r-
.Clearjiy;*
■
i
i
1817
-•
shortages, - governmental
hindrances, a vicious black market,
material shortages and hoarding
'
•
•
•
".'••:.^«-"'
;
;
'^are
discouraging that I shall
so
not
pain you with a detailed recital.' There ar£ two things, how-
.
:
v
./ever, which I should like to
■
:
,
V
;
j
men-
tion.
First, with all of the con.trols,, and millions of subsidies,
the Administration at Washington
able to report the completion of
only 287,100 homes ready for
\ '
oc-
during the first eight
months of this : year.
And this
total includes trailers and single
guarantees
■
reconverted army and navy
room
bafracks and other wartime build¬
ings. This compares very unfavor¬
ably with
the ' 715,000
housing
units which were erected by pri¬
vate effort in the year just before
the
The
war.
other
statistics
want to give you is the
tion
00
one-third
-
*
should
be1,
from present values to cover val¬
uation decreases "when the bub-
"11 *
bursts.''.
ble
conclusion,
v
Documenting
this
said, "The house
„
he
that cost
$7,200 in 1939 now costs
ceilings, and at
if
materials - are
bought over, ceilings"—an increase
of 53% if entirely within ceilings
or an increase of 94% at black
\ $11,000 within
-S least $14,000
'V
*;
-
r
v
market prices. The housing short-
^
"
other* things
cial
obligations
beyond
their
means.; But,
the, problem is not
solved, and you may expect more,
rather than less, government in¬
terference or assistance. (It's in¬
terference,
if
the
government
does
it
other fellow;
the
for
as¬
sistance, if done for you!)
.
Public Housing
More
All
along the line; higher costs
more public housing, more
mean
"slum
clearance."
This
termine
the
property
(disregarding taxes, la¬
ple
willing to devote to hous¬
ing which will determine the val¬
ue
are
of residential property. There¬
costs.
with
heavy amortization
during the first two
Such
future of mortgage
lending depends on your appraisal
and amortization policies, in the
critical
tively,
period
you
ahead,
may
have
Competi¬
to
accept
high appraisals to get mort¬
If
you
are
nual
amortization scale may
permit you to lend safely at cur¬
here in Cincinnati. In
your oper¬
ations, a conservative policy is in¬
dicated if you believe
rent levels.
Or, in order to get the
mortgages, you might offer
declining interest based on the
increasing equity flowing from
building
better
activity will be high in the next
few years, as that will reduce the
values of present buildings. Qn
a
amortization.
v>
Danger
very
what-1 said last March at the an¬
Home Loan Bank meeting
to five years.
an
iy-: 00 ■ ■;•/■;!'■
The
gages.
viewed
be
insist On very
fore, do not be blinded by present
and
luxury apartments, likewise,
business
income which the American peo¬
some
should
of
shrinking profit margins, etc-);
and, it is the proportion of their
makes
-
value
bor costs of the business
occupant,
private low income housing a bad
mortgage risk. Luxury housing
•;.,; 'J,-'::
the
other
;
hand,
a
ones
tain
who practice it the most.
In
forced to do so,
conclusion,
may
I
repeat
the
present
levels
and valuation.
and black market prices are
highly artificial props of present
^v valuations. Clearly, they - cannot
ahead of last year, there is a comr
petitive development which is also
running far ahead/ of previous
years. I refer to the /vigorous re¬
last
forever.
The
conclusion
to
of insurance
savings
.banks,
permitted, to develop, own
manage large, housing prop¬
...
where
and
erties. These agencies plan to in¬
vest
directly
next two
in *. all
or
in
In -the
housing
three years more than
previous - history.
A
great
deal of this investment will be in
public
be drawn is obvious.
trend
apd
assisted
housing.
Now, to tie all of these things
Long
Range
Outlook
Good
Not
In contrast to the favorable out¬
look
for
the
?
the
immediate
long-range
estate
ness
values
outlook
is
not
will
property
future,
for
real
good. Busi¬
be adversely
0: affected
by the many changes
which will take place in the field
of distribution.
,
,
,
petition
the
in
The
this
terrific
field
construction
com-
will
of
cause
and
more
specialized
more
buildings, as it
will be cheaper in many cases to
build such specialized structures
0 than
to
remodel
present, ones.
appraisal,
Residential
property
should be
likewise,
on
a
very
conservative
basis,
as
all
old
buildings have heavy unrealized
,
obsolescence
1
because
of
social
together and. give you some idea
of a sound mortgage policy to fol¬
low, under the pressure of the
stupendous economic forces loosed
by World War II, may I say that,
in my opinion, we areriding the
crest of »the -greatest
boom -the
world
has
estate prices lead all the rest. The
credit
and
the
unfavorable
of
even
houses
new
vulnerable.
very'
will have to
for
the
on
erected
values
before
the
though at lower costs.
in
your
valuations
you
keep in mind that women
having more and more to say
about housing. They are not so
should
are
interested
solidity
in
the
of
beams
and
construction.
the
They
don't worry about the foundation.
They
not looking for a house
which will last a hundred
years;
are
don't like old things, ex¬
women
antiques! No, they look for
gadgets and labor-saving ideas
cept
and
devices.
And, the last thing
In the world the
wants is
.;
those
of
one
modern
woman
substantial
«old houses with 10 to 15
such
the
as
in
one
mother worked
rooms,
which her
herself
to
death!
Looking to the future, governmental subsidies in many different
forms will adversely affect prices
,
-
come
ride,
our
How;
I
soon
With business, as
comes as a
down and pay
cannot
but
it will not be too long. Whether
we
will
<of
existing
You know
ing
to
buildings.
of
question
be,
.
Take
veterans'
that
yes,
the
housing.
something is go¬
has to be done
of
down with a para¬
in the economic machine
come
or
for
'"belly" landing, I likewise
say. But we will come
doWn, of that
is
rooms,
although three-fifths of
the veterans cannot afford to pay
$40
a
month for shel¬
to
pay
more
flationary
than
aspects;
can
$50.
y. v
of
losing
never
bright vision of the future, while meeting the
This has
heeiiCoty policy from the beginning,"
and
housing
needs
the-housing
entirely different
say over in Ken¬
the whole real estate
:
True, our people have been on
march, which creates a need
for
housing. According to the
Census Bureau, migration in the
the
United States
war
its
greater during
than in Europe
was
years
slave
movements
labor
and
forced
of
populations.' To
help house this great tide of hu¬
manity, however, 4,029,875 hous¬
ing units were built or converted.
Furthermore,
were
when
it
th
so
e s e
accomoda¬
built during a period
was
generally
that construction
still,
afford
values
what
the
was
housing
which
at
thought
a
stand¬
shortage
is
put
worries
does not
into
flows from what
of it.
are
lions of
women
is
a
we
me
come
the
from
thing. Value
can get out
Long-run real estate values
not
us
who have used and loved
the
our
being
products.
fixed
t"";.,/■
l''i"C:J '•ji'V*-.'r'
.-;r.*"
\
by
tqday'v?
black market .prices of labor
and
;
*' /•
'>.•.
*'•'./
'
•
•It'Vv" .".••".'V-C:-'
;r:-;v."
Today, in the perfume and cosmetic industry,
and in the world of fashion and
price struc¬
ture is concerned.
with
for
won
respect of our business associates and the mil¬
and
two
are
things. As we
tucky, "It takes money to buy
whiskey," and that means em¬
ployment, wage income, so far as
tions
proud that it has
the Atlantic shores. But
on
market
the
we .are
ever
The- in¬ I materials. It is the income of the
of: the loan American people which will de¬
of preparation*.#
problems of today.
great and has been very
since the first settler
very
great
landed
most.' Value
Yet, a National Hous¬
ing Administration survey shows
statistically,
the
veteran
needs a purchased home of 4.6
as
many years
hewing to high standards
the
be sure,-<i
you may
that,
much
result of
y. What Poifoy
not as great as many think!
It is the inflation of real estate
as
leadership
cannot
about that.
ter, and only one-fifth
true
say;
chute
a
with nations,
we
and
if Also,
v
is
question about the need; it
effect
buildings
war
-
structure
Granting thie ! foregoing, what1
policy then should be followed?
First, let me say that many of you
apartments
adapted to modern may
disagree with my conclusions,
needs, such as lack of domestic because you feel the need for
help and smaller families, become
housing is very great. There can
available, they will have a very be no
When
'
financial
sound, but the price structure is
-changes in'-the American family
itself, improved labor-saving
X gadgets and increased taxes. :
i.
;
known, and real
ever
there is
no
name
with
more
of
repf
-r
While the volume of mortgage
financing is running nearly 190%
companies
be¬
do,
you
Higher taxes, declining busi¬
ness
profits, and lower interest
yield
on
inherited
funds, will
vival; of the
you
lieve that the building boom will
there
is
danger ahead.; And remember that' be short-liyed, because without
inflation, such as we have in real large scale construction
activity,
estate today, is like
sin—every¬ employment will not be satisfac¬
one is "agin it," but often those
who protest the loudest are the tory and payrolls will not main¬
Whatever
critical
a
conservative
policy is also indicated if
Ahead!
eye.
age
-
*
the
deducted
*
..
and
already'done, aj-e obvi¬
ous, as the present, system encour¬
ages veterans to assume finan¬
by Myron L. Mat- make the success of such ventures
.thews, executive Vice-President of
highly problematical. The middle
;Pow Service, Iric., before the So-j
classed'aref still'Sound, but they
ciety of Residential Appraisers in are
having their difficulties. And,
New York on Sept. 19. He exof course, wild inflation would de¬
pressed the opinion that about
stroy their' solvency. ' 'f 0000
'
•
I
informa¬
released
b
have
we
cupancy
'•}
-wunoAi
i—
gracious living,
prestige than Coty.
THE COMMERCIAL &
1818
only
1779)
(Continued from page
milreis. They pick out
the field of industry
and
commerce.
They pick out
these pegged rates and prices in
spite of the fact that the men
the
paper
prices
in
words, at
price these commodities
gold.
"X
Currency
issued
by
govern¬
cable
which-would have
on,- a
reliance
very often it ill de¬
ments, and credit projected by in¬
dividuals and institutions, includ¬
profligate
govern¬
until a very
modern period seldom scrupled, for the sake of robbing
their creditors, to confer on
all other debtors a license to
rob,,theirs, by the shallow
and, impudent artifice of low¬
ering the standard; and that
least covert of all modes of
served;
a
ments
>
•
,v.
to
in terms of
relied
however
point at which a little
of course, the underlying laws of humility would prompt them to
human behavior, are obscure and say: "We haven't the faintest idea
intangible and very difficult at of what the rate or price should
field of economics which involves,
one
been
Stability
Needed: A Free Gold Market for
Thursday, October 10, 1946
FINANCIAL CHRONICLE
having
governments,
ing
created a
ply of pieces of paper which
sup¬
said
in
effect, "We promsie to pay on \
demand, or at some time in the
future, so many grains of ounces
all. Accord¬ be, we might bettter throw * the
•.■v.
people wise in the use of thing on to a free market so that
we 7 can
get some sense of the
stop at a certain point
of gold, for value received." These
operating
and
experienced in and provide a certain flexibility price or value from that"; they
pieces of paper were put into cir- ■
these
fields confess freely that in the
scheme, which the statistics refuse to admit their lack of fore¬
culation ; and
served
as
money> ■
they have the greatest difficulty are supposed to interpret or gov¬ sight and go along a route of pre¬
which furnished a means of in¬
knavery, which consist in callestimating
what these rate or
to know certain things
ern, for the various forces or fac¬ suming
dexing
values, a or 1 ■, establishing •
prices should be. Men of experi¬ tors to come into some kind of that they don't know a damn thing v^4ing. a shilling a pound,, that a
prices for the exchange of goods.
ence confess frankly that they do
about.. Then they sound off loudly,* --;debt of a hundred pounds may
natural balance.
1
They were called paper money.'
a--bei -cancelled by. the payment
not know what the
prices and
In
these
processes
of fixing letting on that they do know;
Prices eventually expressed
of
a
hundred shillings.
It
rates should be and they suggest
prices, pegging rates and estab¬ They project the pegged rates or
themselves in terms of gold. Paper
,;r. would
have been as simple a
that the best way to establish the
lishing ci;oss rates of exchange and pegged prices into the .scheme, iv
money prices coincided with gold
plan,, and would have anrates or prices is to throw the
values of paper monies in terms which they have at the-time* the
prices when there was unqualified
components on to a free market of other monies and gold, I have power to control and the damage ; . swered the purpose as well to
have
enacted
that "a hunconfidence that the currencies and
and let competition establish the
observed these pegged rates and gets under way. The black mar¬
credits were redeemable in gold. ;
iv dred" should always be in¬
values.
•: ••,:'X'"■"'X
kets get under way,-or the local
prices being picked out by groups
terpreted to mean five, which
Paper money prices fluctuated
of men who had a very starved or international "wise guys" move
Competition of Free Markets
would have effected the same
in relation to gold prices inversely
background in the use of statistics in with a system to take advant¬
reduction
in
all
pecuniary
j, ,,
vs Statistics >'
with variations in the confidence
at all, and yet, they had the gall, age of the difference between the
contracts, and would not have -, prevailing that the paper was re-*
During
the
last twenty-five if you want to call it that, either pegged rate and the rate that is
been
at all more shameless,
deemable at par in gold. As the
years there have been countless to pick out pegged rates and prices real from; the standpoint of the
Such strokes of policy have
r
probability
of | redemption
in¬
examples of pegging rates and without any statistics at all or else law of supply and demand.
"i -not wholly ceased tp be reccreased^ the paper money prices
prices all over the world. There pick them out on a background
In all of these experiments I
ommended,
but they" have
were more nearly like gold prices.
are certain definite limitations to
of. statistics that were very faulty. never have seen it to fail that
ceased to be practiced; except
iOn the other hand, as the prob¬
statistics that baffle men's minds
where a pegged i rate^ o,r
occasionally, .through dher meand there also is a speculative
Interference with the Law of - picked
ability of redemption at par de-"
diUm Vof vpaber
money,in.
area
in economics and financial
creased, the gap widened between
;
Supply and Demand has X, lished to govern commercial operwhich case the character of
paper
money : prices
and gold
Brought Only Confusion
■ '
problems that cannot be covered
ationSj it has the immediate con¬ X the
transaction,
from
the
prices for the same commodities.
by statistics. It is much better to
t; > and Black Markets
„
sequence of stalling the
market
greater obscurity of the sub¬
X Obviously the ; amount of ■ gold
go as far as one can with statistics
or Jn some way or other interferr
During these years an infinite
ject, is- a little. less bold-n that provided the substance for a
and then let a certain flexibility
amount of damage has been done ing seriously with the free move¬
faced."*
circulation of currency and credit
X^xTI'^x'X
in the scheme operate so that a
ment of goods or the -itra^sfer of
to production and distribution in
was the principal factor affecting
relationship can normalize itself
funds, meaning principally : the
the
in terms of factors - that cannot my own country, and in countries
k^#^^efrm^ht^hasbeen vuhder- This. probability of redemption.
I have observed abroad, by these payments of debts. In other
be interpreted by the statistician.
probability of redemption
I yet have to observe ^
'taking, ' ; the
most revolutionary
These factors, particularly in the presumptions of v: menX In other these
years
a
singlefifexample changes and thei'ppst revolution¬ was proportional to the amount of
where the law of supply and de¬ ary ^experiments in the * use of gold, and inversely proportional!
to the amount Qf' currency and
mand failed to work." If a price, rmohey?and the control of money
5 X
XX? ?;\ -'«*
of financing. >" These credit. " X
is put on an article of commerce
X The real price of a commoditythat the public considers^toQ<iugh, changes are based* continually on
the public won't buy - it aLJhat .ne^udeologies' in monetary prac¬ depends on the supply * "and der *
to interpret at
times
ingly,
statistics
,
.
,
.
.
v.
-
,
.
„
„
ticed How tragic that these ideol¬ mand for that commodity and
the supply and demand for gold.
ogies are not held up more defi¬
The paper money price of a com¬
nitely V against a background of
experience -and observation be¬ modity depends on the-^gold price
fore they are enacted into Gov¬ and the probabilities of the re-"
that I have never seen any, new ernment decrees that, controvert demplion of the paper money at
formula
projected
by A anybody economic laws. These experiments par in gold. Since 1914,1 have had
front row seat at many of the
anywhere in the world that is con¬ have precipitated many countries
exhibitions in panorama of va¬
trary to the laW of supply and de¬ into economic disaster in the last
mand
that
ever
worked.
This quarter of a century. It is about rious governments throughout the
whole long list of experiments to tiiu& fornis to stop, look, and listen world, including my own in put¬
ting on the paper money-inflation
upset these laws during the past' before we plunge further into any
show. All of the scenes have fol¬
thirty years has provided a long new monetary experiments that
X'v
threaten
to
precipitate us into lowed a similar pattern.
list of dismal failures.
,,
•
price. If the price-is too low, th£
producers or merchant will not
produce, it or offer it to the pub¬
lic at the price that is too low.
In other ' words,
again I repeat
-
.
,
•it
shambles.
economic
The Bunk of Inflation
Meantime,
Control
have been putting great
just all
we
with a deluge of words poured
into the public prints and over
the radio fiercely prescribing one
up
as
though
men
Law
The
for
preventing inflation by pegging
prices. Many of the speakers and
talk
econoniid-values in free
niarkte^^
quack proposal after another
writers
We
v
demand v* are the
econoMdjcegulators that ad¬
The
of Supply .and Demand
effect
of Price on
had
*
proportional to the price;
the supply rises as the
every hand for the economic les¬ price rises, and the demand rises
sons of history, particularly in the
as the
price falls.^
,
'X .
field of inflation and money and
The Reactions of Supply and
prices, for the laws of economic Demand on price:
•
- .
behavior, for
the painful and
The price of a commodity is
priceless lessons learned by pre¬
proportional to the demand for
vious generations of men as they
such a commodity and inversely
sweated their
living from this proportional to the supply; that
earth. In 1847 John Stuart Mill is, the price rises as the demand
and falls as the supply
described these abuses of govern¬ rises,
versely
that
.
While there is £till time to
further tragedy,
avoid
I hope my coun¬
try will lead the way
out
>
•
Gold, throughout the ages, has
served usefully as a medium of
credit,
The supply of a commodity is
proportional to the price, and the
demand for a commodity is in¬
reasonably in peace with one an¬
other. Utter contempt is shown on
«•
and a foundation for
particularly when paper
has come to a bad end. ;
Supply exchange
and Demand:
just discovered these problems of
how to earn their bread andlive
in .the^.tragic
XXXs
. z
already
are
climax.n
Supply,: and
is,
money
Return to the
Let
us
.
>
.
Free Gold Standard'
consider now some of the
things we have to do to
find our;
to sound money; and
some of the things we must do to
halt the rise in prices, and pre¬
vent a disastrous inflation. I j
way
back
we must cut down our
extravagance and expenses in our
\% First,
national
economy
,
and
stop
in¬
creasing
the
supply of paper
money of whatever kind, whether
it is in bonds or currency or gov¬
ernmental contractual obligations.
Any commitment of any kind or
of a commod¬ any undertaking by the Govern¬
ment of any kind that increases
ity is proportional to the supply
of money and inversely propor¬ its obligations financially has a
tional-to the demand for money; way of interpreting itself sooner
that is, the price of a commodity or later into bonds and then fi¬
rises
as
the
supply of money nally into paper money. We must
cut down the trend toward the
rises, and the price of the com¬
modity falls as the demand for increase in the supply of paper
money rises.,
X^/;
_-;X- money, or we are just talking
through our hats when we talk
The price of anything is an in¬
about
preventing further infla¬
dex
of its value in relation to
rises.
ments:
"When
become
gold and silver had
virtually a medium
of exchange,
HAHDLING
WE'RE
142,000,000
CALLS A DAY
LOCAL
Further, the price
...
by becoming the
thing for which people genersold, and with which they
generally
bought, whatever
they had to sell or to buy; the
> ally
contrivance
of
coining
obvi¬
ously suggested itself. By this
That's 25,000,000 more
than
,/;X
high.
and
X V;:
a year ago —
;
•
an
all-time
possible that available equipment, with such
additions a!s we could make could be stretched to handle an
increase like that. But it's been done despite shortages of I
materials and other handicaps. Best of all, service keeps on j
It didn't
seem
being good
calls.
"X ~~
process the metal was divided
into
convenient portions, of
degree
any
bearing
tion to
trouble
and
There
to
are
most
recognized propor¬
one another; and the
was
an
delays
once
in
a
be made and installed.
TELEPHONE SYSTEM
by private persons; indeed,
their guarantee was often the
while but we're doing our best
make them fewer and fewer. Service
ever as soon
as new
equipment
"WL
can
will be better than
small
other things
things not only
■X-X
tion.
.
The
second
X'
general
be
necessary,
thing we
back
have to do is to find our way
.
inconven¬
occasion of
possessors,
These
desirable, or
to the gold standard. I am not
attractive, but they must be the
going to suggest that we move
products of our human brainy
back
on
the gold standard we
labor, and accumulated surpluses
had in 1933 when our paper money
of labor (capital and brains). It
saved of weighing
ience which on the
of
value.
must
assaying at every change
would soon
insupportable.
Governments found it their
interest to take the opera¬
tion
into their own hands,
and to interdict all coining
'
of
a
was
purchases
have
on
something else or to
of smallness and
become
found through many genera¬
with trading
international commodities such
wheat and cotton most practi-
tions
in
as
*
*
of experience
Principles of Political
Economy
was
valued at $20.67 for an ounce
gold. I haven't the faintest idea
of what rate we should take at
of
the
present
time for
converting
gold into paper money and con¬
verting paper money into gold. I
understand
that at the present
by John Stuart Mill. Fifth Lon¬
time-in
don Edition, Vol. II, pp.- 21-22.
some
foreign
countries
Volume
such
cs.
164
Number 4532
Egypt, for
THE COMMERCIAL & FINANCIAL CHRONICLE
example, the
yet
American' paperi dollar is ■ quoted
at about $64.00 an ounce for
gold.
Here
we
again, I would suggest that
refrain from having any pre¬
economic
A means
;
bhck
to
on
fit
the
Gold
realistic
some
We
Free
a"
facts.
basis
\
.
our
that
.J
;
>
.
*•
'
.
•
•the
currency
the value of
be
may
...
secure
>
>
•
ties
to
.articles": least
the«'
precious
.been
■•fv?
in
vary
made
;
:
for
and
um;
^
the
no
paper
theirs.
-
...
to
free
a
economy.
dollars, should
be opened
the demand for gold would
price.
Likewise,
monies
of all. other
countries should be allowed to es¬
-
increased
paper
flow
of
consumer
ent high price
levels, will require
consumers/to increase their total
expenditures far above
even
current
the
to
high levels if
be sold.
we
money
the
their
goods
;
^
block the downward readjustment
Whatever
coming
and
di¬
rected toward increasing produc¬
tion on the one hand and
reducing
total
demand
But if
on
the
other
spending or busi¬
spending should falter,/ due
to continued price increases, de¬
ness
clined-in
the
stock
market,
psychological factors, the
ment
must
or
govern¬
be
prepared to read¬
just. its policies to promote an in¬
crease in consumption.
: :
tablish their real values in a free ^.;The/first and most salutary
currency A were a
market for gold in
New York. faction to arrest a decline could
subjected* to strict rules, one
This free market for gold "would : be taken by business itself in
'.-rule - being- that
whenever ^
quickly register the true values j reducing prices—wherever posv* bullion
rose
above the mint
'•i sible—without reducing wages,
of paper monies as no7;
managed
i There can be no doubt that in
price,.the issue would be con-, * system of
exchange
rates -can
tracted until the market price »/■
j some industries the profit posiever do.
pp•>:0p'Pp'P:?'[
w/vof
bullion - and
the
mint
tion is such that prices could be
Such a free gold market would
price were again in accordreduced
and
profits still
be
register the values of foreign cur¬ /
ance,^ such a currency would
maintained : at
a
satisfactory
rencies in American
dollars, set
not be subject to any of the
level.
This will be even more
the currency values of interna¬
evils usually • deemed inhertional obligations, and clear the j true in the coming year as volent in an inconvertible paper. umevincreases and unit costs
way for freedom of trade in raw
Although no doctrine in
: come down.
materials and manufactured goods
.political
economy
rests
on a
f
'
•
,
•
.
»
•
be, • during the
may
fight
least
must
we
inflation
immediately before
;
Real
It
.
is
with
,PpP:-
us.
Wages Decreased
thus
evident
average wage
by
that,
rates have increased
-substantial
amount,
the
which the average working
family has to spend per week has
grounds
•
•
value
with
in the international markets. Free¬
dom
of
international trade
can
thaa
paper
maintained
not
rency
; same
a
cur-
the .A
at
metallic,
.either by convertibility or by
-Jsome principle
of ,limitation. ;
equivalent to it; and although
accordingly, this doctrine has, //
; a though not till after the dis\U cussions of many years, been •,
-
#
.
tolerably
•
effectually
the public
into
med
V
never
exchange
mind;
and
quota
/
regulations.
A free gold market in the United
agencies would
multi¬
throughout the world.
f Principles' of Political Economy
to
be
important
an
increase
salary payments
total
-
In comparison with
1941,
greatly increased personal income
taxes paid by workers constitute
another significant factor. /
\
This
downward
!
•
principal
fiscal
of
excess
receipts
tures.
the
government's
its
over
cash
inflationary
the substantial
ernment
\ 1 Total production of private in¬
dustry has moved ahead to a new
peacetime high .and now stands
at
an
annual
lagging in
of
rate
billion. A Durable
about
goods
still
are
but
some cases,
$172
steady
a
and
increasing flow of finished
goods is reaching the market and
will continue if we have a period
of industrial peace.
^ ;
.
Our Prospects
trend
in
real
war. This objective nat¬
urally had to transcend all others.
beginning,
cupy
however, .that
increasingly
an
position in the control of infla¬
tionary pressures as the transition
tions proceeded.
As
■
.
the
liquidation of the ex¬
penditures arising from the im¬
mediate aftermath of the
Basically the only cure lies in the
output of more finished goods
proceeded,
and services.
cline
Any significant de¬
in
caused,
production,. however
must necessarily reduce
real wages of- the workers of this
nation.
[
' /
'; •//'";■/I,:'
Wage stabilization is
a
policies representi a considerable
relaxation from wartime controls.
situation
is
under
tion of
constant
PpP;
mid-year review of the
Federal budget for 1947, the Pres¬
ident announced that he antici¬
pated
a
cash surplus of $2.8 billion
at the end of the fiscal
year. This
with a cash deficit of
billion in the fiscal year
compares
$16.8
fiscal
present fiscal
though there
Study, and the Advisory Board of
year
is
(Continued
a
will exist
conclusion. Nevertheless,
business,
labor, and Government must ex¬
guide,
to
facts
policies and
as
actions
the coming months.
a
in
■
Expressed in simple, terms, .the
questions to be asked
*
,
on page
can
our
are
these:
production
increase in the next 6 to 9 months?
Can it increase etiough to match
made
effective /by
the-demand
current income buttressed
savings?!"
,
'/■/
by past
4.,.
-
■'Will demand remain at its pres¬
ent
level; will it increase, as pro¬
duction
increases, to provide a
steady market for full production?
Will business continue to main¬
a
cate¬
The output of producer durable
goods rose from an annual rale of
$5.2 billion in the first quarter of
1945
to
high level of investment?
quarter.
billion /in /this "past
Some increase is likely
truck,
tractor,'
and airplane built in the United
year—and for
years to
come—will embody products built
Every motor
States this
car,
but
none of great magnitude.
Non-residential construction
being
curtailed
program.
It cannot
after
the
Production of
goods
and
which
since
of
have
be
Among Eaton Vfirsts"
expanded
more
ume
doubled
continue
can
valve
however,
than
.more
a
steady and
lifter, and permanent mold gray iron castings. Other Eaton
products include leaf and coil springs; rotor pumps; stampings;
to
spring lock washers; automotive heater-defroster units; snap, bear¬
of organizing
is almost completed. The
be
the
as
durable
consumer
The process
should
such fundamental advancements
£ 2-speed truck axle, the sodium cooled aircraft valve, the hydraulic
nearly met.
the production flow, for high -vol¬
sult
are
criticalhousing
housing,
VJ-day,
climb.
by Eaton, and reflect Eaton research and engineering developments.
is
by: :the;-housing
needs have been
ding, lock, and retainer rings; cold drawn wire; Dynamatic dyna-
re¬
.mometers
ex¬
and drives.
:
panded flow of finished goods, al¬
though it
shall
Production for Peace
■v
$11
'
tain
in
there
goods and services will be
possible within the next several
months.
'
4 i"
until
How much
increases
some
is
produce
not
at
likely
that
capacity
we
levels
*
The
duction
three
main
types
should be looked
of
as
pro¬
sep¬
arately: •
(1) Services, food, clothing, and
other consumer
non-durables;
(2) Housing and consumer dur¬
ables;
■: -.-•••.
-
,
.
until
next
How far
year.
we
can
•
continue to
ex¬
MANUFACTURING*
pand total production of all goods
and
services
in
the
future depends largely
General Offices:
immediate
on
OHIO
PLANTS
indus¬
trial peace and the limitations of
COMPANY
CLEVELAND,
Cleveland
•
Massilion
•
Detroit
•
Saginaw
•
Battle Creek
•
Marshall
•
Lawton
•
Vassar
»
Kenosha
•
even
budget deficit
have
we
While
the
1945.
year
The anticipated cash surplus of
the. Federal Government for the
these
Any analysis of our present
p'osi icn, any look into 1947, must
necessarily be made with prices
as a big question mark after
every
available
before known.
be
has
combating inflation,
j- I'n his
19^6 and of $45.8 billion in
counter¬
part of price stabilization. Present
The
war
the government has
been able to throw the
weight of
its fiscal transactions in the direc¬
consumer
exceeding anything
ever
will
oc¬
from wartime to peacetime condi¬
goods combined—have been pro¬
ducing during 1945 and 1946 at a
rate
fiscal
important
The first group—services^ food,
non-durable
war
This excess of expendi¬
tures was, of course,
necessary to
1778)
other
gov¬
period.
(3) Non-residential construction
and producer durables;
f
and
of gov¬
expenditures over
receipts during the
gories such as clothing, it is doubt¬
ful if a large total increase in
:
amine/all
page
of
cause
pressures
excess
Stability: Steelman
(Continued from
an
cash
expendi¬
The fundamental
the present
Rising Prices Chief Threat to
Economic
weapon
against inflation is, of course,
by John Stuart Mill. Fifth London Edition, Vol. II, p. 91-94.
;
■
The
wages should and will be reversed.
stimu¬
public works should be
blueprinted and ready to go, even
during the present period of sharp
reason,
tion.
and monetary measures would
For this
and
late business investment.
wage
tion throws a new
weight of re¬
sponsibility on fiscal and mone¬
tary methods of controlling infla¬
goods between April, 1945
and July, 1946, real weekly earn¬
ings have decreased-that much
sumers
.
measure
Fiscal and Monetary Controls
The construction of the
scope of
the Office of Price Administra¬
It had been anticipated from the
country, and a general round of
Government would also have to large wage increases now can ben¬
efit only special groups, and in
be prepared to take appropriate
action.
Resumption
of . needed general do so at the expense of
the
construction activities by Federal fellow-workers -A throughout
and
States Would make way for
lateral trade
a
drum-
be accomplished with
regi¬
and
uncertain
rates
of
mented
a
:
con¬
"
^vin the
•
more-obvious
trols.
decreased since VE-day. With the
rise of 11% in the prices of con-^
•
:the;mischief of
abandonment of government
ernment
while
a
•
a
be determined whether there will
be any major changes in present
policies
prior
to
the
ultimate
money
further.
r
the
stabilization,
was
hand.
consumer-
to
for
further increase in prices is the
a
task
coordinated
year
outlook
certainly not reduce taxes.
An
all-out emphasis on production of
finished goods and on preventing
j For the. present, Government
are
the
every weapon at our command.
Unless and until there is a clear
indication of a downturn, we must
policies
inconvertible
;,f
econ¬
where monopolistic practices
omy
for
durable goods, especially at pres¬
gold, market in
free,
of the
of
organized
are
gold market where anyone
buy and, sell gold for United
the
."/••' ! "If, therefore, the issue of
;
conclusion, I suggest that
determine
.
.
In
and
value cannot be made to con^to
i
States
r
ought to exist of which * the
form
areas
continue
can
currency
any
rest of this year at
!
A free
medi- '
circulating
In
The
other markets in a
civilized
countries the standard of val¬
ue
government
inflation. The law
of supply and demand works in
money and credit as well as in
value,:
metals,
have
all
along
with
other
stabilization
problems. However, it cannot yet
ment.
-
debt, defray
of
Outlook
OWMR has been asked to consider
the subject of wage
expeditures
are
still
prices by stifling competition,
strong inflationary pressures. De¬ the government should take vigor¬
mand in general is greater than ous action.
" v
:
supply. But -as the nation's in¬
dustrial
machine becomes fully Must Continue to Fight Inflation
.
pay
1819
construction "cutbacks.
Tax
and
other fiscal policies would also re¬
peacetime produc¬
tion, business spending for inven¬
tory accumulation will decline".
paper
their
in,
to
Longer-Range
"
quire reexamination and readjust¬
ma-'
consumer
order to avoid further disaster of
i liable .of all knov/n commodi'
able
national
expenses
return
;sible liable to fluctuation from
the
be
raw
:*a
:
At the present time, the high
levels of business investment and
by
issue
community, is a bril—
prospect, when once a
man
is capable of believing
/ that printing a few characters
on
bits of paper will do it.1" The philosopher's stone could
not do more/'f
p PP';;;/;pp
--from being altered by design,
-a"and may be as little as pos-
accident,-
the
The
great charm in
a
To
r
liant
-
■.
."In order that
society
basic industries and
terials;
whole
will
much'from history
and experience that will help us.
Again I quote from John Stuart
Mill:-
our
.
•"Without taxation, and in fine,
to make the fortunes of the
/,';./'''
-
idea.
the
»
way
learn
can
the
off
Market-
of
unlimited
an
is, in truth,
K;
terms of gold,
pp-*p-ppp
Cut the fundamental fact re¬
mains that we must find
evils
of
of inconvertible paper. There
dollar should be in'
paper
still
'
are
s^and ^projectors
every now and then start up,
with plans for curing all the
,
sumption at all that anybody can
pUt his finger on what the value
of Our
dissentients
n u m e r.o u
'
Windsor (Canada)
1820) V
jiij&i.
H'fr-.n.'jjflatokW
*
T.WH'CntWtyu
Rising Prices Chief Thieot to |
Economic Stability: Steebnan
(Continued from page 1819)
The dif¬ military programs without im¬
ference
between
these two pairing national security and the
ability to. fulfill our international
amounts arises out of the fact that
commitments." :v: c Likewise, 4 the
some,1 - items
(such - as : - terminal
Chairftian: of: the Maritime Com¬
leave bonds) are counted as "bud¬
mission" was requested to halve
get expenditures" this year,''al¬
the expenditures: for the current
though they will not require any
cash payments until some future program of new ship construction,
effecting a saving of $60 million.
year.
•
i
Federal agencies also were di¬
The current high rate of gov¬
rected to curtail public works ex¬
ernment spending is a direct re¬
sult of the war. Federal budgetary penditures, and in some cases spe¬
expenditures in fiscal 1947 will cific limitations were placed on
total approximately $41.5 billion.
certain programs..
More than 44%
of this amount
The /President's, recommenda-.
represents expenditures for the
national defense,, and an additional tions ^
■£ 44%"Js for veterans' benefits/ in¬
estimated at $1.9 billion.
Thursday, October 10, 1946
FINANCIAL CHRONICLE
THE COMMERCIAL &
1820
Quarterly Report
of John R.
Steelman, Reconversion Director,
issued the fol¬
electric
tion's history, in spite of the fact
that in some important industries
they are still
lagging. ' Income
payments to individuals are also
the: highest in^totaL they have
state¬
lowing
ment:'
: uS'i «*>
report on
we
that 4'
are/driv-//
*
steadily-
ing
toward peacetime
to
note
sober
an
We still clothing'
and sold
important battle to win—
we can
We
such
food
as
honestly say we have cony?
adds
up
to
do
must
splendid %
a
.But ;we
•
not f
must
'ourselves!
before us.
to keep
utmost
our
industrial peace, to maintain pro¬
duction at present levels where it "
of
is
high, and to
it to higher •
lagging.^
spur
levels where it is
I
hope
every
business man,'
worker, farmer and consumer will
1
and
still being produced
very high level.
Good progress has been made
in the production: of >lmany con¬
sumer :X durable / goods—we
have
stabilization—before
battle of
the
non-durables
V^Y1'
this
pause to; congratulate
A difficult struggle lies
Making allowances
increased
prices,
consumer
for
4
of
rate
annual
the
should have qn increasing flow
All
billion.
$172
President Truman
warning
A?///''-;/
sounded in the report.
have
reached
now
em¬
the
phasize
during the next few months
achievement.
day, to¬
production of goods and ser¬
vices
by private
industry has
moved
steadily ahead, and has
Yet I should
pro- -r
of these and other finished goods.
tal
ity.
like
and
we
Production—Since V-J
.
V
prosper-
The
buses.
duction';' curve / of ^ refrigerators^-: •
passenger automobiles, gas ranges /
and
sewing machines is rising,
goods and services, more than 20%
over the war peak, and more than
60% over the pre-war peak.
o n
interest.,.:.
with
It /shows
-.
,
and
trucks
and
too, is
- ; ;
'
income,
cleaners,
vacuum
truck tires, electric
ranges, washing machines, radios
passenger and
Consumer spending is high—the
public is spending at the rate of
$126 billion a year for consumer
re-
i
Farm
at record levels.
Mr. Steelman's
conv e r s
been.
ever
read
have
I
*A
irons,
-
are
take to
at
Mr,
Steelman's
put
emphasis
a
heart this sentence
from
*
*
all-/-/
report:; "An
of W
ori4 production
finisheft-goQdSi and.- orit preventing
-
■
pleted success!'uly the transition
a further, ihekease-in .prices is the
already ; surpassed 1940 or 1941
interest
from war to peace. And as we all
only Vby; reducing the. amount \of
production levels in the case of task imirr^iateiy;,before us." 44
charges on the public-debt, arid'
know,-the last battle in any war
money spent by the government,
other purposes arisingtff' the
Is -the'decisive- one. .1 <
war,: In the "fiscal-year..1940, -rori." butv also.' by making, more "scarce
j -Every* American can be proud
the other hand/total: expenditures materials/ available ;Tpr /|mvate. of-what-Ave have doneso far. Here
were
only $9.1 billion, of which use.
Foi/example, the curtailment kre sqnie ofHha '-milestones.- of<file
/ 10% was Tor M
Or ppstpone/meh|"&^
pub^ '•natfon^s*prp/gTe'$S4f r - *:?• --• 4- V* A.
Employment—Of our total labor
an
additional 18%./.for/veterans
lie wqrkk.construction at this time
force of-6Q mhiibri, 58 milUohhave
and for interest on the public debt.
will' make 'more -building : mate¬ jj obs. ,: For 'most' :ol * the. 2/njiiliQQ
(Continued from first page J;, r
ternational ":f i n a nee,/
-
t
Ail We Facing a Permanently
Higher Piice1 Level?
;
In order to
.curt^itrexpenditures
Who are looking for work, the. peThe iripds nf unemployment are short,
and' in:/most; cases' Unemployed
has
directed the .' heads /of the'
elimination of' government com¬
workers draw compensation while
executive departments, arid agen-.
petition/ from* the market - for they are looking for new jobs. /;/■
i
as
;
much
cies to
effect every possible econ¬
of War and Navy
for. the" "Veterans
scarce
commodities should help in
oh
easing upward price pressures
to reduce their
those goods.
\
•
.
contemplated spending in the fis¬
cal year
in
1947 by $1.65 billion and, / President Truman's Comment
President Harry S.: Truman on
addition,'; "to examine the feas¬
tion'that
indicate
one
year.
J credit banks afford a
ment
of
are
number
boiled
as
regular
r,.
;
;
V Increased Money Supply.;;
Frozen In
.
are
f
Rather than
good may be accomplished by us¬
.
ing conditions and terms that are:
Some writers prefer" to tackle familiar to the average person and '/
subject* .via-v the /quantity- can be readily understood. Let. us '
theory-of-money : route.It Is Va first examine, the causes that Will t
fact that there has been frozen into influence commodity:price levels Z.
the credit structure; a huge in¬ and then try -to determine the i
),:
crease
in .the supply of - money. effects.
The total of bank deposits plus
Often there is a tendency tci /
been
This
,
.
_
the banks.
It
that there will
sider
'
'
/-/'
i
1*
i'
"5
-ft
'
■,,J
-
«l
f.
*' % *.
'
companies, savings banks and similar
'
'
■...'//•"
*
* •
1.
'/' .<
r-'
»
/ 'V?
^
ft ••••
.
,
V1
*•'.
l\-
}■
public funds,
only
selling
municipal and
ft
'
^
.>/*
c
1* ' ,v
'■
I' ]'x
ft
r
V«v
*"» V.' 'v
J
"
.
t
Inquiries
\
other
Z-V-
matters
,,"4
|||
,v /
;/V/ banks. Inquiries may be addressed to
'
-
dealer
'
j
--v.
vate wire
of
practically every other component
cost, including semi-processed
purchased, fuel, rent,
of
materials
depreciation
(the last two are
merely the amortization of a cap¬
italized labor cost), as well as the
.
' •'
1
York Agency is
l; :•
,
;v
connected with
Montreal offices by a pri¬
/,/;-4;\/'
system. /:;4
salaries
and
wages
,>{f
,,,r
that A go
CHARLES R. DUNN,
31 Nassau Street
Fiscal Agent
\
:
\
it was to contend
could be raised 25%
without raising prices!)
foolish
(How
that
wages
Once
.
we
CREDIT BANKS
louisville, ky.
baltimore, md.
new orleans, la.
columbia, s. c.
[ st. louis, mo.
st. paul,
minn.
omaha, neb.
wichita, kan.
Bank
The Dominion
Head Office-—Toronto
CANADA
Established 1871
sprincfield, mass.
have
we
v
,
recognized
the
.
major importance of labor costs
as a factor in determining prices,
New York 5, N. Y.
THE FEDERAL INTERMEDIATE
di¬
rectly or indirectly into the pro-;
duction and distribution process./
Labor Costs
.
do
factor, nor
depletion
charges. However, labor makes up
,.
;-V.
Toronto and
charges
labor
portion
a
:>/
locations, taxes and
with
V/'VV7'"1. '•*
r
our
i
v
pertinent to business
Canada.
■*
does
welcome regarding markets,
are
agents, desirable plant
|
obtainable through recognized dealers and
interest
the
include
not
/ y;;*:
.
/,"''1t \
/'''
"'yi
Our New
These obligations are
a
unimportant
Business with Canada
institutional purchasers.
1///'/.., '!>/• i •J"','1'. :•}
ft
<> 1 r
product:
the profit facsmall percentage .of '
price; the relatively
tor is
authorized under the Federal Farm Loan
being legal investment generally for insurance
local taxes, also
manufactured
any
try to determine what part'
of the price is not a labor cost. /
and
As is well known,
of six to twelve months.
amended. They are exempt from state,
as
lead the theme of
subject through the intrica¬
cies of money theory, however, it 4
seems
to this writer that more {
this
|
,«
Act,
>
fact:;
this
ing—Business profits, after taxes, now financed by
,
are at an all-time high in the na- seems more likely
issued / in denominations ranging from
security for various fiduciary,' trust and
such debentures
all be
can
simple
one
funds.
the
Eligible
to
down
money
in circulation is -about think of commodity price aver- /
record is creditabl«, three times the supply of money ages only in terms of farm prod- /
which existed in 1937.
It is un¬ ucts. Manufactured products are
but we are going to make it bet¬
ter. The reconversion agencies are likely that there will be any ma¬ also a very important component, /
doing their utmost to speed up the terial decline in .this supply unless and, for reasons that will be ap¬
construction of veterans' housing one can foresee a substantial re¬ parent later on, it is more logical;
duction in the federal debt, or to consider these items before tak¬
of all types.
Con¬
Income and Consumer Spend¬ at least that portion of it that is ing up farm commodities.
desirable medium for temporary employ¬
$5,000 to $100,000, with maturities
It is obvious that
in numerous
quarters rat the; moment.
ready for occupancy under the
housing pro¬
w
intervals, they; are
details
intricate
These
years,
costly error.
a
350,000
dwelling
completed and
than
of
it is not understood
y :
have
these
veterans' emergency
Federal intermediate
surplus cash balances. Offered for subscription at
fir
the economy for a
on
809,000 veterans are
enrolled in college this fall and
are receiving the education their
country; promised them under the
"G. I. Bill of Rights."
*
/
gram.
the
business: activity.
the sensitive measuring stick of Z
considerable
the relationship of money supply :
it is advisable
to demand—the interest rate—rethat this subject, be thoroughly
mains at a relatively low level, ;/
understood; a failure to under¬
thus
indicating ; a - plethora " of
stand it in the early twenties was
.
the / total of unemployed
veterans is still higher than any
of us likes to see it—about 900,000,
or almost half; of • the, total of un¬
units
since
and
forces must have a vital influence
But
More
of
prices/.^M4tHe/'MghW leYel/'pf /
powerful than those of
forces
tionary
for veterans in
of. 8 million jobs
More than
Debentures
morernomnally reflect Z;
the/effects of highen/ commodity i*
.
wages./ 4 /
Consolidated
poten¬
further increase.as .bank loans ;
a
of Ml types
; Incidently, there is some discus- >
gainfully employed today,
sion indicating a current shortage 4
the .earlier catastrophe.
compared to only 2 million veter¬
in the supply of money and credit. 4
:
Since a war does develop infla¬
ans at work on V-J day—a gain
are
It "is the nation's re¬
sponsibility to see to it that veter¬
ans looking :fpt jobs get satisfac¬
tory employment at the highest
level of their skills and at good
INVESTMENT OPPORTUNITY
-
All of the clues
that/the inflation
more
even
employed.
Consider this Short Term
frozen into the eco¬
tials created in World War II are
I Veterans—Ten million veterans
:
■f.V
was
nomic structure.
.
following the release of the
Oct. 3,
ibility of still further reducing the
be
cnced .by/the/ war-created; Jnfla-
Emergency Housing Program.
He instructed the Secretaries
omy.
available
rials
possible'the President.
as
houston, tex.
Branches throughout
Canada
spokane, wash.
ponent has changed materially in
years.
In contrast xfith
prewar
England, Branch:
3 King William
NEW YORK AGENCY—49
A. W. RICE,
Bell
System
Street, E. C. 4
WALL STREET
Agent
Teletype NY 1-1621
-
periods, either by law or
union fiat, we have
labor
frozen
into
our
structure
mini¬
straight-time hourly:
wage rates about 65% higher than
1939-40, holidays and vacations;
with
pay,
longer rest periods,
mum
London,
•,
recent
by
berkeley, cal.
must examine the labor prob-
lem to find out wherein this com¬
wages,
health and welfare benefits,
lim*/
Rations of productive activity andj
"feather
-
bedding"/
in
various
THE COMMERCIAL & FINANCIAL CHRONICLE
forms.
One
does not have to
mathematician«to
a
"■
realize
be
that
be
much
higher,
Furthermore,
he would not invest the increased!
all labor costs have increased
very! amount of capital to enter the
substantially over prewar years, competition unless he is assured
and
there is very little likeli¬ that the particular trade involved
hood of a noticeable decline un¬ has profit margins wide enough
less it develops in the next great to permit him a reasonable return
depression—which is unlikely to on his new capital.
In addition,
materialize urftil the supply of the present operator would not
good3 and services (including la¬ expand his facilities unless he,
bor) is noticeably in excess of de¬ too, is attracted by the profit mar¬
mand. This labor cost factor, to¬ gin probabilities.
It would seem,
gether with the consequent higher therefore, that the competitive
dollar purchasing
power, should factors, i. e. increased production
distribution
be responsible for freezing into and
facilities,
will
our
commodity
increase
an
the
price
over
structure
prewar
years
at
least
comparable with
the 45% gain that followed World
very
War I and held through most of
the 'twenties. As a matter of fact,
the increase should be
because,
er
the
labor
at
even
great¬
the present time,
forces
not
until
increase
such
time
as
present operators are obtaining an
attractive return
businesses.
on
their various
v
.
Technological Advances Slow
Over the longer term, techno¬
logical advances will tend to de¬
crease labor costs and prices, but
fully emthis process is comparatively slow
stronger, and
the social and political factors are when considered as an influence
on the broad economy.
Further¬
more propitious.
more; bWS 1>£ttdd bf timb^the
Farm Price Insurance
tight labor situation may ease to
C.
ployed,
:
Now
-
unions
let
are
are
turn
us
commodities. Under
the
government
is
to
the
farm
federal law,
bound to see
a
extent
sufficient
a
products a price which is at least
90% of parity—the latter being
the average price of the things
7
that the farmer
r
-
buys,
primarily
of
labor
more
to
presented
work.
to
aid
The
data
is
of
whose
positions
remain
static,
year in and year out, and who
worry in times like these about
the possibility that the prices of
their equities will not return to
higher than prevailing levels. The
inflationary factor presented here¬
in strongly suggests that the aver¬
age price is likely to exceed those
of the present by a material mar-
i1r
r a
Fenner & Beane.
o a
as
partner of J. Robinson Duff &
a
.Co.
:
;
Interest of the late Leonard B.
Keiffer in Beer &
Company ceased
of Sept. 30.
as
Interest
bond
d
Oct.
the
of
Arthur E.
late
Newbold, Jr», in Drexel & Com¬
Lynch, Pierce,
.!
pany,
ceased
of Sept. 3.
as
THE NATIONAL CITY BANK OF NEW YORK
labor interest,
a
Head
Office: 55 Wall Street, New York
long time to come. ! ■
Condensed Statement
!
been
human
nature
contains
degrees of good and had
it
so
(in
of September 30, 1946
as
'777 '7!!':
Cash
qualities.
is
omitted)
dollars only—cents
LIABILITIES
ASSETS
many
rigidly decreed that a
person can obtain $20 a week for
doing nothing, then the other fac¬
t>eriod.
7^
be -see, i.therefore, 'that tors in the economy are likely to
commodity prices have a adjust themselves toward the end
If
-rigid floor at 90% of parity, re- where the- $20 buys nothing.
gardless- of the size of crops or political selfishness, decrees that
the farmer obtains more than his
any supply and demand relation¬
If
of Condition
Including Domestic and Foreign Branches
-
sense,
"*
that- the legislation
Is moreTikeiy to be extended than
terminated at the ^nd' of the two-
formerly
trader with Merrill
on
Mr. Snedecor will continue
17.
trading department. Mr. Mitchell
was
limited
a
George Snedecor, Jr., will be con¬
firm's
the
of
manager
became
as
sidered by the Exchange
Co., 25 Broad Street, New York
as
Harriman, General
Col
of Oct. 1.
Transfer of the Exchange mem¬
bership of B. Burnett Carson to
partner
associated with Homer O'Connell
City,
&
man
Joseph A. Mitchell has become
&
Averell
permit an
coupled with rigid
justice. This has been true ever
<
which the»President shall pro- since the day of the caveman, and
continue true
as
long as
claim that the war emergency has will
sures -are. such
W.
partner in Brown Brothers Harri¬
Mitchell Trading Mgr.
For Homer O'Connell
job.
These improvements,
however,- are not likely to offset
the other increased labor costs for
common
pres¬
changes:
come
in the
effect for two years after the end
of the first calendar year
during
Political
The New York Stock Exchange
has announced the following firm
very
strongly suggests that
cyclical low points in stock prices
are likely to be much higher than
anything that might be suggested
by mere historical precedent.
millions of investors
are
Exchange
Weekly Firm Change*
fact that the
addition, the
to
,
There
New York Stock
inflation factor is present and will
continue with us for a long time
a
the manufactured goods discussed 7 Economic laws in actual prac¬
&bove. LThis law will remain in tice represent nothing more than
terminated.
In
in
the main¬
proper perspective
of the inflation factor as it applies
to long-term trends.
There is too
much skepticism about some of
the dollar sales and earnings fig¬
ures, which are materially higher
than anything registered prewar.
Such gains are not necessarily of
a non-recurring nature.
They are
likely to be the rule rather than
the exception.
tenance
improvement in labor efficiency—
less absenteeism and less labor
that the farmer obtains for his turnover, and
7
to
tion of stock prices. Temporarily, gin, even though patience might
a
strong set of fundamentals is have to hold through periods of
rendered impotent by-the refusal" disturbance such as the present.
"
Due
and
.Bankers■ '.r
f
;
'
(Director Fully Guaranteed)
Obligations
Agencies
State
and
—
•
2,494,669,000
t
^her fedei4l
of
....
.
.
.
.•
1
.
...
Municipal Securities.
-
Deposits
C
$L,180^300,277 ^jlnclimksumted-sfa^EsW
"*■ a77'"* ■LoanJDeposit^ $332,12[3B3^7j
I
>
.
'
Government Obligations
:
,
Banksa^d *
erom^
7 Liability
'"-a
39,669,206
.
-7203,342,413-
.
$1^99^747 - 71
v.
Accept.,,. /.
ancesin Portfolio 3,415,969
-;
$4,723,043,624'
7^7."
V"/"" !
Accept-,77;"
on
ances and
Less: Own
~
V
.
7
*'»;!■-7 ■
,-7-
,
111,683,778
-
*
r-vorh ea Securities:1.
Loans, Discounts,
ships.: Parity, in turn, will hold dollar proportion of. the ■ total
at a level, much higher, than pre- economy then the inexorable laws
of economics will operate so that
; Avar because of the labor cost
:
.faxjtor.* Hence,-one cannot anticipate
Acceptances
.
:
commodities
are
fair
a
distance
above the 90% of parity level, and
to the .extent that supply, and de-
v
! mand factors may warrant
v
F
it, such
prices could recede to the fixed
level. But ev6n so, when such
prices are woven into an average,
along with th^: prices of manu¬
factured products, the extent of
,
The Impact. on
From
Acceptances
must
Securities
Stock
.
-:
,,.
.
inflation
International
Banking Corporation *
(
of
.
^
-
Other Assets
>'
:■
-
V •
Jy.y'i■
,
3,562,686^:
*.
,
31,812,607
......
.
.2,325,000
Expenses, etc.
Dividend*
7
.
.
,
Surplus
v :";.v
■.
are
are
^t*'
.
■
*
:
*
t .7
...
-7; ;
.
.
"
.
_
'77 7
77;.
•
included ascf Feptember75,1946j exccpt those of
prior to the outbreak-.oi the W ar, but tes
-
reserves.
?604,653,620 of United States Government Cbligationa and $4,844>G20 of other assets are deposited
to secure $519,932,393 of Fublic and Trust Deposita and for other purposes required or permitted by Jaw.
porate
stock
f
$.77,500,000
...
....
,
*
. *. 7
.
142,500,000
Undivided Profits -.r 38,398,090
$5,035,050,273 <yf.-gtfal..X.
\ 7 > 7' .
$5,035,050,273
-r-?*
7.\>
Unearned Discount and Other
Unearned Income id
>
-
*
29,467,578
the Dairen -Branch which
.
?
^
" 5,075,410
Efgures of Foreign Branches
77
obviously been frozen into the
structure will carry down to cor¬
for:
7,000,000 ..Capital
.
'J-
7; 77
'
with'Branch^ ^ -y. c4,224,488;?'.^-
^nterest^Taxesj Other Accrued
,,,(
6,600,000
'
1
Total.
so
~
'
.
.......
which has
the conclusion that the level new capital investments. Normal
commodity prices for quite a growth trends, to say nothing of
few years is likely to hold a gain present pent-up
demands, then
over
the prewar period at least will create a condition of underas great as the 45% gain that pre¬
supply, with a consequent up¬
ward pressure on prices and prof¬
vailed during the 1920's.
its
margins.
It
would
seem,
Effects
therefore, that sooner or later the
Now let us consider some of the inflationary factors must be re¬
flected in earnings and dividends,
effects.
Not, only are these im¬
and with an ample supply of credit
portant, but there are many in¬
there is no reason why these high¬
dications that they are not fully
er
operating results should not
appreciated;
If
a
corporation's
unit volume of business is ex¬ carry through to equity prices. F
10,083^062
; y f}
^
a
whether the
-V-v" C7
Federal Reserve Bank
Ownership
earnings/ dividends and
prices.
As
pointed
out
the decline in the over-all com¬ earlier, present- business concerns
modity price average would be will not expand facilities or at¬
small indeed when compared with tract competition unless there is
the 1920-21 figure. Again we come promised an adequate return on
;
in
.
Bank Premises
security viewpoint, we
logically try to determine
and^Securities
"Customeits' Liability for7; I
U the
F
'
,-"**•
'
953,063,063
Reserves
Bankers* ; '
and
........
J^eal.Estate^ Loans
the other factors will restore the
catastrophic declines that took proper relationship. • Thesame
to - labor, - management,
place in farm commodity prices applies
in the 1920-21 period. It is true politics, and any class or group
j :
that present prices of some farm that one chooses to consider. -
i ■>:, ^14^^10^372,972 - cltemsriw Transit
v;
(MJBMBER
FEDERALT)EJFOSIT
INSURANCE
CORPORATION) V!. t
h
7 7
:
:
* :
'
Chairman
Vice-Chairman
of the Board
Gordon S. Rentsciiler
President
of the Board
Wm. Gage
W. Randolph Burgess
,
Brady, Jr.
to
of
*
»
actly the
same as
in
some prewar
year, its dollar sales would be at
least 45% higher. If plant invest¬
ment is at prewar cost, the dollar
sales in relation to dollar invest¬
ment
would
be
at
least
higher. Depreciation charges
percentage
of sales ' would
much
lower
until
such
45%
as a
time
be
as
the
-
*•
,
.
-
-
.
-
must
be
remembered
-
Head
ers
Office: 22 William Street, New York
U*€,
1822
Condensed Statement
■
(in
of Condition
of September 30, 1946
as
omitted)
dollars only—cents
that
corporate profits represent a mi¬
nor
percentage of total national
income
(5.6%
in
1945
versus
71.2% for compensation of em¬
ployees). Excessive demands of
labor, therefore, can never be
satisfied by wiping out the profit
margin. As a matter of fact, cor¬
porate profits could show a ma¬
terial percentage increase without
noticeably altering the percentage
capital investment reflected
the new higher costs.
Interest
charges would be a lower per¬
ratio of this item to the whole
centage of sales if the dollar
economy. Even if corporate earn¬
charge remained unchanged.
ings were to continue last year's
A fixed percentage mark-up in
unusually low proportion of na¬
setting selling prices would result tional income and if national in¬
in a larger dollar margin, and f6r
come dropped 10% from present
the many companies who tradilevels, corporate earnings would
tionally use this method, the dol- still
approximate the 1941 level,
lar earnings would show a very
which was 115% higher than 1937,
sizable gain.
17% higher than 1929, and 147%
A hew competitor would have higher than the 1936-39 average.
to invest at least 45% more capiIt is not the purpose of this dis¬
tal than .the* organization whose course to
suggest that the above
plant *wds baded onf preWaii edsts: forces 'should have" any' marked
His -depreciation charges twould
-influence* on • the immediate -ac
,
-
It
CITY BANK FARMERS TRUST COMPANY
LIABILITIES
ASSETS
Cash
and
Due
Banks
from
.
.
$ 27,973,923
.
Deposits
(Direct
Agencies
Loans
and
Fully Guaranteed).
or
of
.
.
...
.
Advances
.
..
,
.
.
.
...
.
.
$130,699,454
.
,
4,636,911
Loan Deposit $22,606,767)
125,457,855
Re$erves
Other Federal
„
.
.
(Includes United States War
U, S. Government Obligations
Obligations
.
,
tt
1,074,404
.
663,388 \ Surplus
.
., -
.
.
,
Capital
.
.
"7
.
*
$10,000,000
'16,000,000
'
Real Estate Loans
Stock
in
and
Federal Reserve Eank
Bank Premises
2,145,795 ' Undivided Profits
Securities
600,000
.
3,261,644
.
.
Cther Real Estate
"
Cther Assets
•
.
•
•
•
•
•
Total.
•
'
...
1
'
1
8,167,654
28,167,654
\
"
■
•
114,770"
~
2,212,240
$163,504,019
Total.
.
*.
*
..$163,504,019
$27,746,774 of United States Government CbPgations are deposited to secure the
United States War Lean Deposit and for cther purposes
required
or
permitted by law.
(mbmbbr federal deposit insurance corporation)
,,
Chairman
of the Board.
Gordon S. Rentschler
President
Li kdsay Bradford
^
t
1
THE COMMERCIAL &
1822
^Thursday, October
FINANCIAL' CHRONICLE
that
first try to picture what
we
not
be, list the major economic char¬
acteristics of the. period, , and plot
which cannot afford to buy. The picture
out a rough pattern of economic
intermit-! of ^consumers' income is not un¬
liefs, nopes, prejudices and ex¬
developments.^; And That is what
warfare
against industrial; qualifiedly favorable; The reduc¬
pectations of those whose dealings tent
I shall attempt to do.
management
by
periodically tion in hours of work per week
in the market make the price of
and in number of workers per
credit. And, to make the problem blockading the key .bottle-neck
1-A, IIigh;; Level of Economic
has reduced the weekly
even more difficult, we sometimes, points in our economic organiza¬ family
Activity,£.
debunk" incomes of a substantial, number,
-have to make allowance for varia¬ tion. ,We have also to
been
have
carrying
on
so
We
period.
V ? ;;
are, I think, justified in exr
level
the
pecting
production
of
the post-recon¬
to be materially
the average in
on
period
version
dismal
higher than it was in the
.
in
the
of
pattern
intervention.
'
casual
a
fashion¬
was
of
factor
great
it
rise
a
or
a
.workers.' Those
our
on
fixed
who -live
incomes have had
difficult; have " skyrocketed .T o vl
possibility which it would be folly to
very
and there is a
process,
being assumed that a
decline in interest rates
That
their
sion
e v e
*s
of
assujne
long, enough; would be possible; to maintain for
Many "workers have, had
shall find ourselves engulfed' long.
interest
the result of changes
rates
-—the
little
in
a
have
illusion that it is pos¬
transportation an d
In my view
the probabilities are against such
a development, although the pos¬
sibility will remain until by legis¬
lative or, other -means we achieve
production,
sible to do so with precision.
distribution systems..
Obscure -:
Outlook
.^Reconversion
With respect to the reconver¬
sion period from which we have
v'w.
not yet been able to
extricate our-*
selves, it seems to me to be wellnigh impossible to predict how
we
muchgreater stability
management Relations.
,
shall break out of the current
in labor-
.
sibility that the | consumers' dur¬
able goods industries may have
been forced to price themselves
out of their markets. Prices of
,
lems
involved
are
not ;■ easily
solved, for we are faced with the
necessity not only of reconverting
the physical facilities of industry such goods have risen-* substan¬
and business—a process which has tiallydue in part to higher
been largely completed—but also wages, in bart to higher raw ma¬
Of decontrolling the? Washington terials Costs, and in part to de¬
restrictions on prices, production, creased efficiency — to a point
Wages
would-be consumers
justifiably feel that they
where many
profits, and of de¬
of the, embattled
and
mobilising
'
2. Intense
Competition
Another
characteristic v.pf
the
*
;post-reconversion period;:— and;
one -which should be of the utmost 4;
or
no
associated with the war
deferred demands pf con¬
sumers everywhere which accum¬
increase-in dollar in¬
may
some
BROOKLYN TRUST
;he
to
of
course
out
move
».
time, we are ^sure
the condition of
of
scarcity which has prevailed durrecent years in many lines of
:.ng"
goods,
out of the lush period, of
buying almost irr;P
indiscriminate
respective' of^quality
price, to
or'
-
a condition of easier supply, and
tibn, which provides a good solid
multiple choices among qualities
market for housing and furnish¬
and prices of goods and services,.
ings and' community, facilities; arid
in short, from, a sellers' to a
the needs rrif .great sections of the
buyers' market.
'
' '
Vficult and more prolonged^ than' world .not only for relief and re¬
Reinforcing the normal tenden- v
it needed tb be. Restrictions "on; habilitation but what is more im¬
cies in this direction will be the
prices, have curtailed'production, portant, 4a reinstate, to improve,
many and highly significant tecltof many items of strategic impor¬ to extend and to modernize their
nical developments which have
tance
to ~ other ..industries,
and productive facilities. Another circome out of the war period. New
have prevented the importation cumstanceof massive significance
industries mean new competition
of goods which cannot be obtained to the markets of the future is the
for the consurrier'sJ dollar.^ New
domestically. Government inter-" fact that millions of our people
echniques, materials and methods
vention *was expected to smbotli who were completely or partially
mean new low costs for those "who
the process of reconversion;
it unemployed during the depressed
;ake advantage of them. Presag¬
has, in fact, acted as, a decellef ant( 30s, .were raised abruptly to the
middle Tncome class during the ing it from still another direction
There" is thus a. possibiiitipiftti\
:.s the tendency apparent in manywar yeST$-.<These.people now have
we will face a great*'labor crisis,
instances for business concerns to
that business will bog down;.un-v _a/:considerable stake in-cash, de¬
widen their fields of endeavor by
posits and War ..Bonds, in addider government red tape and 'find
tiomTorThe prospect* of continued entering lines of production, mer¬
that its rosy estimates., of post¬
chandising or service heretofore*
war
markets have been seriously employment.?: at least " during the
next few years; hence, they are outside their spheres of^activitieg,
deflated by the rise-in^ prices.
in a position to transform their which means that they are new
The immediate ou,tlook is■ un
wants »Tnto effective demands in competitors of the old-line com¬
certain, but shall we accept the the markets of the
country. These panies. In some fields of industry, J
view—held by some—that we will
demands are riot C likely to be¬ the war period brought rin ex¬
nev^" achieve full ^cpnversioh? come effective until the
cost-price pansion of facilities to a point "
My own feeling is that we are readjustments of the reconversion much beyond anticipated peace¬
time needs and doubtless we shall 4
justified - in; assuming
that the period have been
completed, but
present phase of frustration will
they are large enough to justify have more expansion in some,
in time pass, for I am ^convinced
lines.: than actualdemands wijlv
an
optimistic
appraisalfl of the
that
the great majority of the
support. Moreover, it has been a
post-reconversion
business ^ out
American people believe in and
•fairly
common
.experience;
look, \r*if !>'
want to perpetuate The privateAmerican business, even where
No less important than
these
enterprise system; that they, are
excess capacity .does not exist, to _
.vast markets to which I have re-^
guided by a sense of fair play
find that the break-even point has
fepred. is the fact thai' wO' are in
which will enable us im*time to
risen materially above what it was'"]
the midst of what, for lack of a
arrive at a basis for solvingvOUT
a; few years ago. In addition, for- ,
better-.: term, I have called the
labor / problems 'without
long
eign competition can assuredly be
strikes which are costly-alike to technological revolution, As a re¬ expected to reassert itself in time. T
sult of The war/ many technical
labor
and
On the whole, it appears that the
business;
that
they
advances were precipitated that
recognize that industry must have
post-reconversion period will bemight otherwise have taken years
marked
prices sufficient to permit profit¬
by rugged competition,:
to
emerge
from
our
scientific
able operation; that they are com
relatively low profit fhargins and
laboratories: And A far from being
scious and proud of the fact that*
a high rate of business mortality,
just isolated developments in the
American business and labor pro"*
which means that business risk
broad scope of productive enter¬
duced the goods which enabled us
may 4 be : immeasurably " greater
prise,
theses discoveries should
to win two World Wars and to'lift
than it was during4he period Of
find wide application in Ameri*
the American standard of living
easy war-time, profits.
5
«
can
industry during the years
to a point where it is the envy of
ahead.
New
methods, materials
the .whole world. And I believe
3. A High Degree of Instability
and machines capable of creating
that the instinct toward produce
While a period of high-level ac¬
entirely new industries and of
tiveness is so great in this count
revolutionizing costs and stand¬ tivity appears in prospect it seems
try that our people will not* for
ards
of
quality
in others are probable that a considerable de¬
long tolerate policies which keep
awaiting exploitation, and this in gree of instability will be char¬
the nation's economic
organiza¬
acteristic of our post-reconversion
turn should mean that the period
tion in low gear and hold back
of
high-level
business activity economy. Some of the markets to
its economic progress. I believe,
which reference has been made
which appears in prospect should
furthermore, that the people of
are
more or
less temporary; for
be a prolonged rather than a tem¬
this country are not economically
example, the backlog of deferred
^
^
..
,
.
COMPA NY,
NEW YORK OFFICE:
MAIN OFFICE: :
ulated during the war period; the
fact of accelerated family forma-
significance to investors — is the
probability that it will be marked
3y intensely keen competition. Iu
.
about
Another cause for concern
the immediate prospect is the pos¬
period of economic frustration or
when we shall do so. The prob¬
::
the
paralysis at a time when domestic
foreign needs for our goods
are
so
urgent,- But* that we can
have, if v labor ; organizations in
many communities and industries
simultaneously
call ' out
their
members at the key points in .our
.
no
of pro¬
and
rates,
to
make
some
"guesstimates" as to the general
shape of economic things to come.
J
record
accomplishment,
should
'threat
of
industrial
ductive
discussion of the outlook for
interest
brilliant
its
face'
that this nation,
incredible
seems
are
in business,, with
essential first step
an
The outgrowth
combination of circumstances
we
prices, monetary policy and a host
of economic, political^ and psy¬
chological factors.
Thus it is
a
are
largely
in a wild price Inflation followed
in the future course of
comes; "while their cost of living
* v ;
business. Today, however, much: by; the ' inevitable Jbust.
has risen; they are not likely -toless weight is given to interest- ■ri There is also an ominous pos¬
be purchasers4 of. optional goods"
grates as a determinant of business sibility that before the reconver¬ at
.higher, prices^4:®.4
®
and for our purposes here it prob-> sion period has been completed*
GoVerriment policies have^made,
ably is better to go almost to the we shall face bne of the most
serious crises of our history.- It the reconversion period more dif¬
other extreme and assume that
in
"shall, when reconver¬
completed,, witness
These markets
response
movements
we
has been
that if it is delayed
virtually automatic
would have a
out. to be
turned
significance to the economy as a
whole,
of
30s.:.&-;-
.
by it
able to believe that interest rates
were
abouttaxes and
prices, profits, money,
debt, which somehow gained ac-; gross cut by lower interest rates a period of high-level business
ceptance during the past 20 years' and their net reduced by higher activity .as ^compared with the 30s
of inflationary
boom, deep -de¬ taxes; and the purchasing power; 13- strongly suggested by the fact
pression and global warfare. Re¬ of what is left is lower because that'American business has sev¬
conversion
in
this
sense
has of the rise in priees. Farm profits eral vast new markets to develop.
■
.
In years gone
of the absurd notions
some
official
thought, since the markets for
money are not free from official
tions
,
ore-war
elements of organized labor
1781)
page
it is
in .the
in many respects
ominous as it was
the general economic climate will
Inflation, Interest Rates and Investment Policy
(Continued from
be desired,
10,-1946
,
>•'
177 Montague Street
2(jf Broad Street;
New York
Brooklyn 2, N. Y,
Condensed Statement
,
..
4, N. Y.
of Condition, September 30, 1946
■
-
..
RESOURCES
Cash
on
Hand and due from Federal
Reserve Bank and Other Banks
U. ,S.
State and
Other
165,473,393.76
Municipal Bonds
5,156,625.25
.
Securities
2,980,914.19
Loans and Bills Purchased
Bonds
Bank
$ 58,643,113.83
Securities
Government
and
36,161,114.12
—
Mortgages
912,966.71
_
Buildings
2,500,000.00
Other Real Estate
1,000.00
—
-
Other Resources .4
.
*
.
Capital
"
'
:
835,881.73
'
/
■
'
<
"nT
/'
$272,665,009.59
LIABILITIES
'
___TT____^f._
_—,
Surplus
Undivided
Profits
Reserve for
5,600,000.00
'
1,879.897.66
______
Contingencies ___—778,691.85
Deposits
254,809,392.35
_________________________
Reserves for
8,200,000.00
^
~
'V' i,397,027.73
Taxes, Expenses, etc.___
$272,665,009.59
United
States
carried
at
Deposits
Government
$39,719,322.01
and
for
other
One of the Oldest Trust
Member
Federal
Reserve
New
System
York
and
and
are
State
and
pledged
purposes,
as
Municipal Bonds
to
Public
secure
required
by
law.
Companies in the United States
Clearing House
Federal
Deposit
Association,
Insurance
Corporation
illiterate
and
fore
see
long
lative
that
we
shall
be¬
electoral and legis¬
evidence of that fact.
-
j
porary
one,
Another
that
,
factor
the -stage* is
which
suggests
being set for a
period of high-level activity in
the
post-reconversion period is
that many of the influences which
a better balance in wage, cost and
price relationships, get unnecessary paused business to remain de
governmental restrictions out^of pressed in the'decade of the 30s
the way, and settle^down'To $ seem- likely* to be less effective
period of high production and; jmfc Then, pur goveriiment had an anti
proved operating3 efficiency. ^We business complex; we ; were in a
period of rapid-• economic,- social
may have a long and rocky road
to travel before we arrive* at that and political' reform, which drove
state of affairs, but I am'prepared capital into the storm cellar, we
to believe that we shall' get there were plagued with under-investh
eventually. The outlook f©repro¬ menU and ^over-saving,; which is
duction, prices and employment highly^deflationary in its effects
during the reconversion, period on business*-arid The clouds of war
must remain obscure and I.Think were gathering; Today the out¬
that instead of attempting to fore¬ look is far from clear but many
reformers have
cast-what will happen we should of the militant
adopt
a
"wait-and-see"..-. policy. beemcast out of our government
This is the basis for my assump¬
tion that in time
shall achieve
we
radical is coming into
conversion period seems to me to disrepute, the urge for social, eco
offer' somewhat clearer- guides for nomic- and political reform is on
the wane, and new investment in
investment policy. -■
**
capital
equipment, - community
Probable Characteristics of the
facilities and housing promises to
Post-Reconversion Period
expand vigorously, which shoulc
time
remove
the threat
of
In order to appraise the .trend in
"over-saving." And while the in
of interest rates in the post-re
But
the
outlook
for
conversion period,
the* postrre-
it is
the; term
essential1 ternational picture leaves much to
consumption ' demands
resulting:
from the war and those
segments
demand representirig
relief
and
rehabilitation S needs
will decline in importance, with
of
foreign
first
industry
and
then
being ; affected.
For a
one
another
undoubtedly face very |
capital- expenditures by
concerns, <. individuals
and state and local-governments,
but these expenditures are likely
to vary considerably from year to
year. The problem of correcting;
maladjustments in-wage, price
and- cost relationships is neither
time, we
heavy
business
likely
to
without
tion
be
quickly nor*
solved
obstructions
which
to
at times may
serious proportions.
Furthermore,
it
produc¬
assume
p
is
to
be
ex¬
pected that the government itself
will
at times contribute to in¬
stability
in
our.
economy.
Al¬
though the concept of "compen¬
satory fiscal policies" by the gov¬
ernment is designed theoretically
to offset
irregularities in privately
sponsored business activity, we
know that in practice political as
well as economic considerations
'.Volume
X'i w^ll
164
Number 4532
determine
government
-
THE COMMERCIAL & FINANCIAL CHRONICLE
ex-
pective
demand-supply relation¬
ships suggest that, downward re¬
adjustments in prices/ will occur
penditures. Tax policies also are
likely to> have a disturbing effect.
'
They are a cumbersome control
device, for the effects of a tax
•
reduction
.
or
budget and;
/
tax increase
a
business,
on.
in the
field
great,, the
debt
of
management, and
controls, the govern-
monetary
;v meat's frequently enunciated ob-
;
gjeetiye of keeping interest
1.
!
Agricultural
for
.
prices .-. are
decline
a
due
when; demands
for our domestic products
rates
low is. apt-to find- itself from' time-
:
the
sibilities
likely
y/ to.be considerably delayed. In the
;
While
uncertainty and the pos¬
of
misjudgment
are
following broad ten¬
dencies appear probable::'
; ;
the
on
are
time.
of
course
of
areas
}„
yjoff,.
fall
they must when the
rehabilitation of foreign pro¬
as
/ /
to time in conflict with the
probduction enables foreigners to
lem of curbing speculative fervor
and preventing inflation. Govern- •/iC. compete with us in the world
markets.: Also,, advances
in
;ment policy is likely to be deter.
mined
by first
then
and
.
the
consideration
one
other
with
K
v
ernment is, I
remain
afraid, likely to
am
factor. making for in¬
stability rathfer than stability, and1
with the level of expenditures as
a
high,.as it promises to be,. changes
in'expenditures and deficits tend
•
to: have*
-
a.
magnified effect
economy as a- whole;*
:
Other factors,
in
;
the
on
•
such
changes
as
inventory policy by business,
of speculative elation
waves
,
not
ment
to;
be
we
wild
what
of
comfort.
,for
will
mark
years;
>
-3
■
This
;
the
tion
/
suggests
that
1. The
of the
ability of our industry to.
goods in great volume
does not ring as true today as it
did before labor-management re¬
corrective
depres¬
;
v
U
the historical
,*
unlikely that
no
we
can
the
pecting
that,
for
some
tions
^
:;
corrective
sharp
depressions
.
and
at
in
duration. In the first place, the
mbney supply is so largely based
■jr upon monetization of the public
rv
-.
■X*-
i
substantial credit deflation
t
uhlikely.
.
•
its
volving
assets in-
minimum of credit risk.
a
?■: Therefore, the possibility of pres¬
et1 sure from the banking system to
/contract credit, appears to be remote
•
indeed, and- it is to be
membered
had
•*
.a-
really
a
such
5v
that
that
as
rapid' and
have,
we.
serious
of
severe
without
credit deflation.
4..A, High Level of Prices
i;
,v
Inflation is already present in
jJX-
our
markets and in
i
all
I,
prices
broad,
a
over-
the natural Ipressures on
still upward; for the
sense,
are
/•^existing
supply
money
is
large
X- and the monetary base is sizable
enough, and capable- of sufficient
v
.further increase so that it imposes
1
automatic limits
no
pension such
on
credit
ex-
formerly applied
iv. under
the old gold standard. Un/•:• der existing circumstances, when
one
price is forced upward uni
duly, the resulting maladjustment
is /likely to be resolved by in¬
j
in
creases
as
other
prices.
And
we
have in organized labor a power¬
ful agency for raising wages in
;
first
one
area
and then in others.
between:
of
!
the
vicious
spiral works to
perfection, for each successive in¬
crease
the
inthe
structure
wage
rise in costs and provides
basis for further labor de-
means
a
ymands. And the monetary struc¬
ture puts no limit on the proc/
ess;; in fact, the policy of_ com¬
pensatory spending by the gov¬
ernment is inflationary in its im¬
plications for while under actual
practice we get heavy deficits in
periods there is little
emergency
or
nothing in the
in
good times.
Yet there
s..the
price
are
way
-
of surpluses
,,
-
$ ft
"■
*•
of
down
able period
for
a
ahead. But
structure
where
t
within
pros¬
Mortgages:
Banking Houses
,
;
measure
The
well
smaller
than
savings,
consisting
of currency,
deposits, sav¬
ings-bonds and savings and loan
assets,, have increased since *1939'
by roughly $150 billions, which,
demand
and
time
.
Surplus-
.
creased
.y
.
might be
re¬
garded as necessary to provide till
money, pocket
currency,... neces¬
savings
working balances and rainy
day * reserves,
at ' the
current
higher level of national income,
leaving about $80 billions avail¬
able
for
other
uses.
However,
sary
,
.
2,475,000100-
.
24,375,722.37
|
.
11,079,425.61
11,379,226.40
.
.
,
.
.
/,
.
.
521,056,713.20
.
t
,/y
.
,
.
.
,
v
275,797.29.
8,790,774.12
5,699,310.27
.,
.
.
♦
r
$41,250,000.00
-
*
.
%
41,250,000.00
Contingencies
,
I
.
9:516,865.22
.
Dividend Payable
.
October 1,1946.'
..OutstandingAcceptances
Liability
as
Deposits
.
,
.
;
.
.
..
^
V
.
.
.
j,
....
.
1,237,500.00;
: -10;059,548.60
Endorser on Acceptances; and! Foreigm Bills.
9,506^58.39
»
.
-
L17,627,079.64
.
Reserves for Taxes, Unearned Discount, Interest, etc*
/
f
35,127,079.64 $
.
208,338.00
r;
.
? 2,217,309,885.30
.
.
$2,365^465,475*15
United States Government securities carried ats $177,837,111.64
are
pledged to
secureUi Si Government Wan Loan Deposits of $141,127,569.73-and other
public
funds and trust deposits, and for other purposes as required or permitted by law.
birecto rsCHARLES FROEB
'
-
'
It BEINKCKET "'
)
Chairman, The Sperry & Hutchinson Gdi \
BLOOM
v
.
,
*
,
Chairman, Atlantic, Gulf and
S. >
West Indies
>-
Steamship Lines
: /;
BRUSH
t
/
A-■%
Etodwsts.Casporation>
-
'
President
'
^
■ii" Coal Co.
>
/;
-
of America
,
•
-f
?•/'. f ,•"
JOHN M. FRANKLIN
:
.#
;
'
//; :r/. 3
Company
RICHARD
City
•
>'
v
\
ERNEST STAUFFEN
Chairman, Trust Committee
GUY W. VAUGHAN
JOHN T. MADDEN
Corporation
.Vv\;,v.'.;V
Vice-Chairman
ALBERT N.
President, John P. Maguire &
/. / Co., Ifte*;: /y;
/ :•/: -;•
XXf
President, Curtiss-Wright
HENRY C. VON
President, Emigrant Industrial
Savings Bank
JOHN P. MAGUIRE
President, United States Lines
New York
President, Home Insurance Co.
..
President, United Biscuit Company
Chairman, McRoberts& Tegtmcyer,Inc.
.
f-yX
MacLELLAN
•
HAROLD V. SMITH /
Simpson Thacher & Bartlett
KENNETH F.
CyXtfXkXZh
HAROLD C.
;
SAMUEL McROBERTS
President, D&na Corporation
'■:
.
President, Lambert Company
; '
■
Xf
DANA
PLANIGAN'
,:•
i/,.'./ ::
JOHN L. JOHNSTON
''
Vice-President
^GEORGE-Jt PATTERSON ^
President, Scranton & Lehigh
*
-
r
HARVEY D. GIBSON
s.
••■'i
President, George A. Fuller Company
HORACE G.
>•
OSWALD L. JOHNSTON
LOU R. CRANDALL
CHARLES A.
;•:••
■i'President,GerU &€bi,lhot.
}
•
>•<Chairman,.American ffome'
_"V
j
t
4-
ALVIN G.
Presidents Cluett Peabody &
PAOLINO GERLI
EDWIN
EDGAR. S.
C. R. PALMER
1 r. Chairman, Lincoln Savings Bank
Chairman, Mtithieson Alkali
Works, Die.
r
ELM
of the Board
WILLIAMS
President, Westinghouse
Air Brake
Company
since prices of consumers' durable
goods
about 05%, that $80
purchase
only - as
$50 billions would have
purchased in 1939.
•
are
billions
much
up
will
as
Figures
such
and
as
it
these
are
should
be
phasized that the comfortable
tion
that
"it
can't
not
em¬
no¬
-happen here"
Principal Office: 55 Broad Street, New York City
l-ly
71
y/:/':
banking
offices
in
greater
new
york
European Representative Office: 1, Cornhill, London, E. C. 3
Member Federal Reserve
System
'
Member New, York; Clearing House Association
.
3,756,005.67
.
.
•.
.
Equities
Undivided Profits
.
is-an alarmingly high figure. But
about >$70; billions of these * in¬
1,221,787,131.38.
30,862,317.34
.
......
EDWIN M; ALLEN:
soma
Mortgages
523,928,0^1.50*
$:
,
.
liabilities
Capital
inclin¬
observers believe it to. be. Liquid
.
$2,365,465,475.15
inflationary potential may
be much
.
Customers' Liability for Acceptances .
Accrued-Interest- and Other1 Resources
Reserve for
of inflation; y
.
».
■
Other Real Estate
ation-is to feel that the prospects
favor at moderate rather than- a
wild
.
■
"y
\
1.
;
^
,
consider¬
my
-'u•
v.
"
wide/fluctuatidns in the broader
instead
k
Loans, Bills Purchased and Bankers' Acceptances
■
price indexes;, as well as in. the
prices of individual commodities;
but
with the
money/ supply
as
large as it is, with organized; labor
possessing
the
power
to force
wage
costs upward, ±the,< longer
term trend seems likely to be up
'-
,
Stock of Federal Reserve Bank
Other Securities.
Under these conditions, it would'
be surprising if we failed to have
conclusive
*
some areas
/
properties.
,/•
Banks; y
State: and Municipal Bonds
j:
.
•
Here
COMPAXY
KESO'UR€ES
-t.'y
—
-
U'. S-. Government Insured F, H. A.
of real property,
case
:
depression
1929-34
on
re¬
never
receivables.
and/
of Condition a&at close of business September 30;, 1946
U. S. Government Securities
to
increasing
for
V'"-:
■ %.y
••
••;
Cash and. Due from'
-
activity increases and cur¬
rent shortages become less
acute,
but
with the later
trend upward. Great varia¬
tions are likely to be evident,
however, from one area to
another and in different types
consist
resources
principally of quality
rise
—
$:
ably will decline from present
inflated levels when building
banking
system,
is much stronger than
that
sense
v*
Condensed Statement
prices of urban housing prob¬
seems
it'was in the 20s and 30s in the
1
lifted
race
5. In the
The
moreover,
—
are
some ; fendencyy,#pward over the long future;
;
debt—which at best probably will
be subject to only gradual retirement—that a period of rapid and
*/
goods
^hertvOBA restrict
the- outcome of
organized
labor to raise wages and- the
scientists of industry to re¬
duce
costs,; the end' result
being close to a standoff with
be
short
TRU&T'
••"
finished
of
depend
the
our
may
but
severe
ventories
larger
M AMCFACTU ItE R S
labor and raw material, costs;
thereafter what happens will
X least, a depression of the severity
/- and length of that of 1929-34
k ought to be avoided and that
actual
non^-agricultural
compensate
ex¬
years
need
savings is reduced: materially
transportation costs.
4. Prices
appear
to be several good reasons for
Many corporations will
savings.
amounts of funds for
essential'
working
balances
and for use in carrying in¬
me,
duction, in the richest or most
we can
hand, there
to/ reduce
of
should
On the other
creased.
to
de¬
a
secur¬
by the need for larger amounts
does not,
provide a' clear
answer
to
the - question,
which*
plagues us all, namelyr are we go¬
to
thus, is
2. The effectiveness of war-time
The present situation
seems
Inflation
of
impair
convenient sources-, of supply
and»
probable increases
in
-do
:
flator
Inflation and Interest Rates
to-
as
of individuals
irregularly upward because of
increased labor costs, or re¬
sincerely
students believe that
sopie
save.
-
.
much
so
ability
of new
volume
dollar
ity issues to finance such ex¬
penditures will have to be in¬
yof living expenditures, has in¬
materials may ; well trend
raw
de¬
escape
and of allf capital
expenditures- will be greatly
enlarged,, which . means, the
proportion of current in¬
required; to meet cost
creased
works
programs,
comes
troublesome.
labor costs even; though* labor
rates remain unchanged;;
3. Prices
precedents for this
matter how
infla¬
means
"
mentioned above make it highly
pressions
Ukely
are
T
view, the elements of instability
?;
so
public
of
cost
tion and increased efficiency
from time to time. In addition to
■
lations became
the
projects,, of new capacity for
industry,
of
modernization
.ganized- /labor;;
minor
and infrequent
set,backs dufing business recesr
-sions when labor reclassiiicarf
likely to be experienced
are
4.. The
,
,4,
post-reconversion
sions
because
with the
will
credit
volume of business.
same
cannot have inflation because
produce'
it,
have
we
goods,
more
have to be used to. finance
that
argument
that
1823
-
In
of purely working funds in
this connection it is; interest¬
agricultural ' prices
bank accounts and for larger
ing to note that while corpo¬
ing to have more inflation and, if
seem
likely to remain
on
ration cash balances have in¬
amounts of currency for
;v higher levels than they were so, how much? BUt from the point
creased from $12" billions to
3 ' ; pocket money./
:•
: .;
{'.<
pre-war for the reasoir that of view of the trend of interest
a
I V!"
high of about $25 billions,
government
supports
are; rates'
in
the
post-reconversion | •: 3. The purchasing power of the F- ;
-/ their ratio to* the dollar vol¬
f.:
savings available' for use is
likely to remain.
period, the important consideraume' of
business being, done
i M
sharply curtailed by the- im2. Prices of labor seenr destined
! !*fis not much: higher than, it
tijon is that we have' already had
Xl
creased prices' of homes; auw
•y to> move
upward under the
tomobiles and other1 consum¬ !''; • (Continued on. page 1824),
a considerable1 degree- of ihflktiony
impetus of pressure from or-
and
atmosphere of instability
considerable
a
ahead,
'X>vry
y
But,
period
the
already had.
is true
today
have
we
The
-
-
ers" durable
result
/
a
i,
.
.
accepted
That is too close
deficits.
picture
for
re-
the affected commodities.
pessimism, - and rapid and wide
changes irj the climate of inter3,;; national affairs are1 likely to add
7 to, the instability which probably
should
.
duce farm costs gradually in
conse-
quent aberrations in policy. Gov-
technology
.
without which means that prices are likely
inflations to hold on the average far enough
are
the result of great previous above the levels
of the prewar
money expansions, scarcity in the years
to alter significantly the
supplies of goods and the use of suppl-demand
relationships
for
banking credit to- meet govern¬ long and short-term credit.
is
reservation,/ for
>
farm
.
x
Member Federal Deposit Insurance Corporation
:
THE COMMERCIAL & FINANCIAL CHRONICLE
1824
period
Inflation, Interest Rates and Investment Policy
to
short-lived
(Continued from page 1823)
| today's inflation I in prices, with
was
before
the war.; Many a consequent increase: in the de¬ inflationary boom, banks must be
mand for credit, tX.
; placed in a reserve position where
^'. corporations are finding that
they will reduce their holdings of
while their cash balances are
Interest Pattern Change Essential securities as
they increase their
larger than ever before, they
:
| Thus the inflation we have al¬ bank:'loans. *'';j;;;l;,
V-V'i'v, have little or no "free" funds,
,
;7;' and they are already arrang- ready had and the threat of more j.".;.
Summary of
ing for credit accommodation. to? come ' poses- a very difficult
,
.
!
\
General
%r--'
Characteristics
of
the
problem for the-monetary and
; I
Post-Reconversion
Period
,1 From another point of view we
banking authorities. They would
are
in v/hat might appropriately
1 The post-reconversion years
like to shift from pro-inflation to
toe called the "effective" rather
anti-inflation
policies but they thus seem likely to be marked by
than the "build-up" stage of in¬
would, of course, prefer to do so a high average physical level of
flation, a fact which has impor¬ without disturbing the level of production, ^ an intensification of
tant implications for the money
interest rates. The more imagina¬ competition with an .increase in
market. In the build-up stage dur¬
tive of our monetary authorities business risk and in business mor¬
ing the war, the supply; of avail¬ have devised all
sorts; of, new¬ tality, a high degree of economic
able money for; investment was
fangled schemes to enable them instability, a generally higher av¬
continuously increased, but the to work the miracle : of keeping erage level of prices than in the
■
'
.5
-
dustry is
,
prices
less
for
and
credit
closely limited
The
use
therefore
was
or
the
more
or
controlled.
of money was restricted In
number of ways
— by rationing
price control, by the unavaiK
ability of many types of goods
and by patriotic appeals to !maxi-,
mize savings and to funnel them
a
and
back into United
for
by
use
the
States securities
Government/ The
vital
point is that while., money
supply was being inflated rapidly
and
substantially, price s rose
slowly and moderately. Thus the
,
rise in the supply of funds avail¬
able for investment
greatly
bedded the demand
ex-
for credit
so
freely
:
expansion
sets
.
more
In the
rates,- and
to
a
loans
and
trend
shift from
a
invest¬
of interest
a
serves
bank
buyers'
check,
.
credit
then
the
new
loans. This
Under
>
these
re¬
conditions
shop around
The
trend
of
long
and
short-
Government
the
post-reconversion
on
banks
no
longer
curve
•This raises
and
to
rate
lower level than in the
a
the Federal Reserve possess¬
greatly expanded powers to
make that gold effective, the? au¬
thorities have the power to hold
time
some
because
and
;;! The situation which I have
pro¬
anMim
both in the
bank
period
new
securities
make
to
"What else
can you do
money?" — was the
clinching argument for purchasing
securities of lower quality, longer
maturity and smaller yield than
could under normal conditions be
bond market and the
loan
—
the
market, has been cut
to an abnormally narrow spread.' justified.-:'
This tendency is likely to be re¬
The outlook for United States
versed in the period ahead; and Government securities cannot be
the market for second grade bonds divorced from- 'the general 1 y
would appear particularly vulner¬ changing environment which we
able because of the extremes to have outlined, although such se¬
which it has been carried. Auto¬ curities
will certainly occupy a
N
9
matic profits on a "cost plus bas¬ preferred
position in the port¬
is," which were so prevalent dur¬ folios of our great financial insti¬
tutions for many year& to come.
ing the war, are in for a drastic
change djuring the highly compet¬ But the money market is not rig¬
itive conditions in prospect and idly compartmentalized; .the nat¬
when the volume of new issues is ural pressures on
interest rates
increasing the discriminating in¬ will be upward and for the first
vestor will be under much less time in many years, sizable out¬
ft* »>
S:
ahead.
I
But
AVE.
ities
and
matching
We
funds.
into
a
may
of
late in long
term
gain
as
-
>.'.«•
BROOKLYN,**Y."
-S-s.-'
X
f*
»
.
X '•
»'r *
''X
j.
.
Furthermore;^;l; susppct ,*that'
as
;
much; if at?ail;foiXt .the eliminatiprt: times jgp6S"by,r inflationary, pres¬
absorption and, of premiuin sures; will force- the abandonment
jot free
'
.byfthe:Federal: Reserve of itsiconr^
'deposit
insurance
' corporation-.'':
aagSSSaaSaySgBaS
■
i
*
^'Itisiprpbable that-at
pWlg.ln
.
sotjie.
trrhe
specu¬
will find that their
compared
with
principal which
the
may
in
losses
have to be
absorbed later; The times call for
caution..
V
•:
';
Fargo Balliett to Be
Partner in Reich & Co.;
; r
Fargo Balliett, member of the
Curb
partner in
Exchange,
be-
Reiclt&Xb^ 39...
bp-available not; only %o indiyidu*
BrdadWay,• New IYork; City, mem=» •mv^stora:be'rs pf .the Curb; Exchange;bn Octv
;}
mortgage loan market,,
"the quoted rates may riot; rfse-veky
?''
expense,
current;income is small-
York
*.r:
the
maturities with short
money
in
a
£'[:
moving
be
quality and those who
ckme
''In ' the
AVE7 I^hdUONEYtlSUAND "AVE ;
well
increased income at
New
come.
-'/■
ma¬
period when those who seek
lets for investment funds in other
compromise
their
up
turities with prospective needs for
tljian Government ^ecurities-.shp.uld
to
>
time, under the cir¬
cumstances
outlined above, Qur
monetary and banking authorities
may find it neither desirable nor
possible to adhere to the 2Vz%
coupon rate on long-term Treas¬
ury
obligations. The 2W% rate
quality
pressure
19th •AVENUE
inclined to
also
am
think that in
in the-interest of maintaining inn
;V •*
have
'this
of
securities and when the state¬
with
the influence of
prolonged easy money conditions,
the differential in yields between
prime and second grade credits,
DEKALB
on
.
ment
cent years, under
and
assurances
ond place, if the trend of interest
rates is upward we had better try
rapid technological to
forget the notion,—popular dur¬
progress, and with large amounts
ing the past few years,—that "ma¬
of new municipal securities being
turity doesn't mean anything any
offered to finance necessary im¬
more," and I suspect that investors
provements. We thus may move will find it to their advantage in
out of the period when investors
the long run to return to the prac¬
have found it difficult, if not im¬
possible,- to meet their needs for tices of evenly staggering matur¬
a
jected should in time bring many
changes in the relationship be¬
tween the rates on various types
and qualities of credit. During re¬
and
the. hiorietkry
authorities
banking
given: strong,
ket; with corporate new security
issues as high as they must be in
rise in rates in check; and
finally because the interest cost
on the
public debt is a powerful
argument: for
moderate
rather
than spectacular changes in rates.
any
ST.
;
interesting ques¬
an
high degree of economic instabil¬
gages. And if that is the case, I
suspect that you will be less in¬ ity, with intensified competition
and increased risk, and with the
terested in competing with the
outlook varying so much between
banks for loans at low rates: and
different industries, quality con¬
generous terms, and the buyer ;of
siderations and diversification of
credit wilt be less likely to be
risk
should
be
given increased
able to shop around successfully.
weight 1 in. the selection; of securi¬
;Other investors may soon find ties for investment portfolios. The
that it is much easier to. supply
risks of compromising with qual¬
their needs for investment media
ity are likely to be much increased
with
a ;large
volume >; of World over what
they were during the
Bank issues coming on the mar¬
bull market in bonds. In the sec¬
be^
ing
minimum amount of interest.
.
philosophy is deeply imbedded in
our official thinking; because with
gold stocks as large as they are
'
to adopt
new
.
20s; because the low interest rate
-
on
-
pay
the short end of the interest
federal
the rather oldpolicy of setting the rate
offerings for the purpose
of getting the maximum amount
of funds instead
of to pay the
fit
see
fashioned
j
interest
demand deposits, which anchors
cause
STREET
might even
.
period
should be slow and moderate
FULTON
expanding
of
face
the
credit demands. They
they would gain in loan in¬ lieve.
'
*
come.
That they may do -for< a
Investment Policy
"
;
time,
but; eventually .earnings
.1 .shall hot dwell on the policy
pressure is likely to make the
sellers; of credit .tighten up :oh' the imbiieatippS :0f .what has been -said#;
but; it ;does\seem that if this pic*^
rste-'ahd the terms. In the second
ture " of ; the ' post-recohversion
place;' the!1 bhildirig ';ih?d ua.$• t y.
should," once it gets into high gear, pefiodls reasonablyclose tb^etuat;
developments, then it is time to
produce new mortgages at a rate
of several billion dollars per an¬ give some thought to the advan¬
num,
which £ would mean in all tages - of ; the old-fashioned but
time-tested standards of invest¬
probability;; that the institutions
ment
management.;' In the first
you gentlemen represent may well
be able to fill all or most of their place, with the economic environ¬
ment likely to be marked by. a
investment needs from new mort¬
interest rates is a most significant
member
in
to
as
maintain; such
^
-
the amount and rate of change in
•'
rates
to
than
consideration for investors, wheth¬
er or not the rate is low by histor¬
ical standards.- The rise in rates
86th
powers:
and
rates
interest
of
thei/
loans, Which means that at cur¬
rent- rates some of them would
may not be as; invulnerable as
lose more" in investment income some observers would, have us be¬
^
in
"largely eliminated, with
holdings of short-term se¬
curities
near
the
indispensable
minimum, banks face the pros¬
pect of having to sell intermediate
sellers' market fpr money*
'
-
bank
level
among the banks'
'
&.
in
borrowers could
.
5
the
able terms. Today with excess re¬
for
rising
a
ac¬
18
are
to be
wit{n very good objective and there is little reason
prospect of getting a- lower rate, to question their ability to fulfill3
longer maturity and more favor¬ it for a somewhat indefinite period
ments,
orthodox
amount of reserve credit available
ORPORATED
to meet
corporations for
total
they make
as
ceived.
: •/(/
INC
policies
Reserve
Federal
available
techniques of restricting the
BROOK
and
the full'amount of the interest
effective
OF
.
tion concerning the durability of
the sacrosanct 2Vz %. rate on long
years'ago. Then banks had billions ineligible United States securities.
of dollars of excess' reserves and I am
prepared to grant that that
a; new loan added to income by rate is
likely to be maintained for
to the banks. They will do. so term interest rates should be
up¬
gingerly and: by fits and starts, ward for. the reasons cited previ¬
stage of infla¬ after
trying all sorts of expediehts. ously, but it is likely that the rate
tion, the emphasis in the moneyBut they have no alternative in: of "advance will be slow and that
supply and use relationship... is
the end but to make the change, while the level of interest rates
shifting in
important
respects. for
they must in time recognize will, be rising,! it can-still be re¬
Money supply is .rising slowly, but
in official policy.; the fact that if
garded .ns • low «by- those who have
the use of funds is now much
less
d e v e l.o p e d - an ^emotional
we
are to. have, prosperity bank
at¬
restrained, and we are in the
phase when yesterday's inflation loans will rise, and" if we are to" tachment * for cheap, money, as
well, as ," by - those; who - hay e
m
money is finding expression in avbid
isionnn
the' d&ngOr of. Converting
gone on- record:■.with ,predictions
.that rates axe; to pemgin low for
a long while ahead. It is not'quib¬
bling however, to point out that
comodations
if
in relation to the volume of funds
Therefore, I think we can be rea¬
sonably sure that the authorities
will reluctantly in the end have
the
is required
down, for-that action
would represent a sharp contrast
with
the
conditions
not
many
•
on
first
banks will be under the necessity
of disposing of other earnings as¬
.
to fall back
active
authorities hold
available that 30s, and the adoption of anti-in¬
monetary policies by
money rates will be low and. at flationary
the same time preventing the use the banking and monetary author¬
'of the funds from supplying ad¬ ities.
\ j
ditional ■ inflationary
pressures.
-The Outlook for Interest Rates
But Congress has lost its interest
If this picture of ; the' post-re¬
in; complex
monetary ; schemes,
jCe^esianisih" is -less popular in conversion period turns out to be
high places, and few people under¬ reasonably close to reality, we are
stand or care much about the in¬ likely to experience a material in¬
tricacies of monetary policy. crease^ in' the demand for: credit
funds
the
And if because of the ever-present
threat of inflation, the monetary
,
of
In
additional funds to expand inven¬
tories
and
accounts
receivable.
,
demand
market.
needs of business
■
rise
a
place the demand for bank credit
•
■
shall be able accurately
the market for credit
effectively anti-inflationary,•
I also regard it as likely that the
is : likely to increase to finance
Treasury will wish to correct the
export trade at the high level unbalance between long and short
which most observers expect, to maturities
by the Offering of fairly
supply
the
funds
for
a
rise large amounts of v. long-term se-\
to
a
new
all-time
high
in curities. Finally, it is conceivable
consumers' credit, to supply the that official
quarters will in time
construction; loan
funds, nec¬ adopt less figid ideas as to the
essary; when
the building in¬ desirability of ah artificially low
as
that prosperity into a
'
we
describe
sellers'
1940
Thursday, October 10,
v:>;iD^^.I.aT0SI:^HOD--HK1::
Number 4532
Volume"T64
THE COMMERCIAL & FINANCIAL CHRONICLE
1,325
r-iry^iwWltihW
*
'
»'
v
•
•
■
*
i
1
'
•
mmLL.
i
,
1
*
'
•
possible moment.,
The Future of Atomic
that
Energy
(Continued from page 1778)
Development of the uranium
nounced
industry beginning with min¬
development
ing the ore and following
through to the raw materials
include
a.
v
«
.1;
for
necessary1
operation
Construction
b.
0
,
of
of
During the pa3t
sions
assembly
plant
at Los
Alamos, New Mexico. ... .: *•d. Operation of all of. these far
bombs
atomic
several
least.
construction
it
sible
•
•
at
were,
not
solely
,
cinctly by Colonel K. D. Nichols
shortly after V-J Day.
Colonel
Nichols said: "The public is' prone
to hail the inventor and the final
product and to overlook the engi¬
neering and construction that is
essential if the idea of the former
is to be translated into the latter.
The
engineering problems . v .
■were numerous, unique and stag¬
geringly difficult, the time sched¬
ule only slightly ?hort of imposssibleJ'
Let
shows
tude
record
relative
the
to
as
of
the
magni¬
what
see
us
work
the
carried
on
in
the fields of engineering and re¬
the
of
and .under the
Commission that
makeup of this Commis¬
and its responsi¬
powers
bilities.
-
create the most
capable ahd
pow¬
Govern¬
our
ment.
The Commission will
prise
a
com¬
Chairman,
four
other
Commissioners, a General Man¬
ager, and four Directors, heading
the
divisions
neering,
of
..research, engi¬
and military
production
application. The effort which the
Congress made to insure a strong
capable Commission is indicated
by the fact that the salary paid
is
500
for
the
diffusion
317 for the electromag¬
netic process,
and 302 for'.the
metallurgical process, exclusive of
housing.
The amount expended
process,
on
research for those three divi¬
sions
and
was
$45,000,000,
$33,000,000
$42,000,000, respectively.
In
other words;! if, we take .the peth
centage<©JB ,the whole combined
engineering,-construction, and re¬
search, about 90% was spent for
construction and engineering and
10%
only for research.
Let
will not be called
heaviest burdens
come.
on
to bear the
in the years
'
,
to
1
which led to production of
can do. other than to con¬
which
is
the
turned oVer to
venture
to
predict
that
our
re¬
for
a generation at least.During
that time it behooves us to settle
we
sajaries of the
Cab¬
Com¬
missioners and the General Man¬
ager
set at $15,000
are
which is the
same
per.
year,
the Cabinet
as
members'
salaries, and the salaries
of the Directors, $14,000, exceed
by a substantial margin the sal¬
aries paid members and heads of
most other independent commis¬
that
entirely
new
^appointments
shall be made at that time for the
year
Dr.W.O.H.
punitive
could
us
•
that
visualize
the studied non-cooperation of the
Soviet Union. It seems to me that
the time
has;
must
forward with
the
go
control
based
with
now come when
the
of
^atomic bomb
associating
on*
we
plan for
a
ourselves
those nations which
-
are
fa¬
vorably' disposed to our plan. Let
the Russians stay on the outside
if they do not care to come in.
When, and
in,
we
as
„
care
to
come
entertain their "appli¬
can
cation.
they do
'
..
the evident intent of the Act that
the
advice
the
of
General
Ad¬
department or agency
pertains.: to
nuclear V or
which
atomic processes.
It will have sole
eritire
the
power' over
starting with uranium
industry,
in the
ore
improved, costs have been
and
plant capacity has
been increased.
A recently pub¬
cluding bombs.,
If, for instance,
dustriar
concerns
or
of
in-
our
one
a
or
friendly nation pot
which
and
and in
and
a
sionable
material
and
completed
C. Manhattan District Plans for
the
ficient
may
stocks
sionable
of
material
either free
or
on
then
allot
uranium
to
The
so.
or
the
terms
fis¬
project
it
fixes.
present time the
by making grants in aid,
even
finance the
operation is under the di¬
Engineers
through the specially constituted
Manhattan
Distiict.
Operations
ment.
effected 'to continue as
present until thA creation of a
new Atcmi
Energy Commission.
A Uitionai p1 ns recently an-
entire
or
it may
develop¬
look the
entire
rection of the Corps of
may 'be
at
>
\
;
4. Future of Atomic Energy
A. Military Aspects—No discus¬
sion of atomic
energy can -over¬
military aspects. - We as
engineers are vitally interested in
seeing that the international situation is cleared up at the earliest
."
-
,
(Special
to
PALO
The
Financial
ALMO,
Chronicle)
CALIF.—James
C. Needham and Kenneth R.
have
been
ship
561
in
admitted
Needham
Ramona
to
and
Street.
been serving
our
Company,
Both
Founded 1824
Broadway, New York
in¬
CONDENSED STATEMENT OF CONDITION
of business, September 30,1946
ASSETS
Cash and Due from Banks;,
U. S. Government
Bankers' Acceptances
Rather,
State
they would be hidden in the Berkshires, the Catskills, the moun¬
$231,644,595.40
,
,
576,995,649.53
Obligations:
aihd Municipal RnnfU "
rr"
"
Other Bonds and Investments
L
.
V
Coast, and in
carefully selected hideouts iii bur
j
63,524,478.03
c
*Other Real Estate
From
areas.
skilled
operators
these
could
points
dispatch
aggressor
nation.
I
do
not
Credits Granted
know
are
all
that
of
you
primarily
in¬
terested
is
soon
atomic
will it come?
power.
How
ex¬
bills?
In my
7-A
opinion, the task of
pro¬
ducing atomic energy and of con¬
verting it into electricity or steam
is
a
that
task
$1,300,605,977.32
LIABILITIES
Capital Stock-
of
major
magnitude to
constructing one of the
atomic
bomb
material
plants, and the time that will
Reserves for
solved from
an
project is
ertgineerin' a- stand¬
point, it will not necessarily be
economically sound.
Only con¬
-
tinued operation of atomic energy
(Continued
on page
1826)'
5,691,189^7 $108,788,642.52
-
Taxes, Expenses, etc.
$6,373,298.15
Acceptances Outstanding
(Less
own acceptances
held in portfolio)
,
'
.
'
1,267,579.94
3,105,718.21
230,719.36
*
Deposits (including Official and Certified
Checks Outstanding $27,282,461.79)
.
4,927,197.58
1,125,000.00
Dividend Payable Oct. 1,1946
1,180,428,699.65
$1,300,605,977.32
,
$126,899,131.23 in the foregoing
deposited to secure public funds
required by law.
Securities carried at
-statement are
and for other purposes
be
the
I.--"
13,097,452.85
_
Unallocated Reserves—
so will be of the
order of from three to five years.
after
/,. 65,000,000.00
Undivided Profits.
required to do
Moreover,
$25,000,000.00
_
Surplus.
in
equal
3,681,852.84
I; 622,357.27
Other Assets.
Other Liabilities
>
4,852,111.98
Acceptances-
Receivable.
-v
tensive will its application
be, and
will be its effect' on our
power
on
Accrued Interest and Accounts
look
B. Peacetime
Application—The
peacetime application in which I
254,793.50,
2,231,404:01
>1;: 177,988.35
Mortgages
them with unerring aim and com¬
pletely paralyze industry of the
*
,,,
\
1252,473,368.31:,
Tanking Houses
rural
72,980,458.92 '"
;
Loans and Discounts.
tains of the Pacific
91,166,919.18
and Call Loans
| Assessed Valuation $4,063,083.00
have
in the armed forces.
&
At the close
Sayre
partner?-!
TRUST COMPANY
tive retaliation. We would not be
foolish enough to have bombs lo¬
cated at vulnerable points.
suf¬
It may also bear part of the cost
atomic bombs.
Future— At
Commission
do
\
bank
what
to
-
ishemicalSII
165
.
Needham & Co. Admits •;
—DR. W. .O,H,GARMANk i
Secretary, American Council of
Christian Churches; Vice-Presi¬
dent,. Independent Fundamental
Churches of America.
i
not protect the aggressor nation
against rapid and highly destruc¬
atomic energy utilization, permis¬
sion must first be obtained from
Commission
New York.
„
contingency
would be to contemplate, it would
V-J Day.
the
Vine¬
'
member of
Boston, and paralyzed
How
Much of this has come
continued opera¬
tion, but particularly from lifting
the veil of secrecy. This condition
has undoubtedly resulted in con¬
stantly enlarged stock piles of fis¬
'
Haven; Richard L. Kennedy,
Karris, Upham & Co., New York;
and
George J.
Leness,' Merrill
Lynch/ Pierce, Fenner & Beape,
yard, Matt. 21:33-34; and the Par¬
able of the Talents, Matt.
25:14-30,
approved of the profit motive. Ac¬
cording to Him a proper return on
capital invested was to be ex¬
pected/'* * •-'>
1
^
"
CompahV;
New
else."
a
&
"
& Summers, New
York; A. James
Eckert, Mohawk Valley Investing
Company, Inci, Utica; Wilbur
Hoye, Chas. W. Scranton & Co.,
recognized capitalism
His teaching concerning the
Householder Who Planted
Morris
On District Committee No. 13.r-r
James Currie, Jr., Troster, Currje
possessions
someone
S.
Hartford.
"Christ'
dustrial production at those
points.
Fearful
as
such
a
group of our electric utilities wish
to
develop
processes
involving
through
-
Robert
of
other
belong to
the
lished statement gave present pro¬
duction as several times that on
about
1947:
plan, that we may
be
subjected
to
another
Pearl
Harbor at the hands of some un¬
,
i,;'
'
one
appointment
_
in Past Year—V-J ground, up to and including fin¬ for such an
eventuality, but I do
feverishly operating ished products containing and pro¬ contend that the fear of retalia¬
all completed facilities to their duced from uranium.' It will also tion would
prevent any nation
utmost capacity % and completing take over all patents and con¬ from
attacking another one which
plant construction.
During the tracts and secret information and, had
an
adequate r. stockpile
of
past year construction has been subject to the direction of the atomic missiles, in just the same
completed, plants have been oper¬ President, it will have sole power way that fear of retaliation banned
ating 24 hours per day and seven for disseminating information and the use of poison gas and" disease
days per week; efficiencies have distributing uranium products, in¬ germs during the late war.
* *
j
been
the
announces
a
a
us
reduced
have
we
they have
the right to confiscate industries,
atomic energy group.* £ I see
five-year tenure of office. little danger of such a
contingency
: The
Act also provides for two as long as we have a
large stock¬
advisory. committees, namely, pile of bombs;
Let us suppose
Military Liaison Committee ap¬ some nation was fanatic
enough to
pointed by the Secretaries of War make a sneak attack on some of
and Navy, and General
Advisory our coastal or industrial cities.
Committee
consisting
of
nine Suppose they badly
damaged New
members appointed by the Presi¬
York,
Pittsburgh, v Philadelphia
advise the; Cojnmission on scien¬
tific 'and technical matters.
It is
National
Nominations are to be made^'fd
replace the following whose terrhS
of office will expire on Jan.
15,
re-
that,
of the mistaken ideas of many
normal
dent from civilian life. T,he func¬
tion of the Jatter. Committee is to
the
;. : A
claimed, in opposi¬
.•
■
Jt inay be
tion to such
con¬
radical laborites is that
bombs
At
measures.
of
none
our
of
anything so
acquired. We have gone to quite
some lengths in
making this evi¬
dent and necessarily so because
utilities
to use
Inc.,
us
'K
whereby we might permit the Se¬
curity Council of the United Na¬
us
of
by hon¬
"'/•■On the Board of Governors™
estly is ours
Harry W. Beebe, Harriman, Rip¬
and no one
ley &7 Co., Incorporated,
New
has any right
York,
and
Robert /' S.
Morri&
to deprive
Garman
A
one
tions to direct
13
come
ago, in a paper delivered before
the Boston Section at the Harvard
Lecture Hall, I outlined a
program
are
what
.
have ;the
a
Bryce, Chairman of
No.
Association of Securities Dealers,
the
peat
7/v;/
Nearly
been
strained to
the international situation so that
it
will
never
again
arise
to
threaten us. 'A;- V;
7 V.
terms.
Jerrold
,
program', if implemented
engineering develop¬
ment/will keep us in the forefront
own
T.
District
Nominating Committee com¬
steward of its posed of Ranald H.
Macdonald,
treasures.
11 Dominick & Dominick, Chairman}
isn't the own¬ Herbert
R.
Anderson, Distribu^
ership of tors Group, Incorporated; Jamd4
property that J. .Lee, Lee Higginson Corporation \
is
wrong
but Clarence E. Unterberg, C. <E. Un*
the misuse of terberg
& Co.; and Walter AVi
it. Once more Wilson, Morgan
Stanley & Co. ju
search
our
Nominating Committee
who has he?
man
with proper
industrial plant to im¬
plement that know-how.' It would
be the height of folly for us. to
throw away the
advantages which
this position gives us,
except on
has
c o m e
B. Progress
Bay found
Lord's
clude that it will be a decade be¬
fore any other nation can vie with
us in atomic bomb
production. ,1
time
President's
ernment
that the engineer
say
bombs
for
the
of
The
In addi¬
u
no one
work
the Chairman exceeds that of the
inet.
visory Committee would be sought
tion to construction and engineer¬
mainly on non-military matters.
The Atomic Energy Commission
ing,: the operating organizations
are largely staffed
by engineers will inherit entire atomic empire,
and, to a very limited extent, by including
plants,
finished
and
scientists.
Probably the percent¬ semi-finished bombs, and all other
age there was also of the order of property now held by any Gov¬
SO to 10.
"The right to property is firmly
established in the Bible. The earth
members
during this development sions.
It is to be hoped that the
period. • These may be visualized President will recognize- the chal-*
by an analysis of the expenditures lenge and will appoint the ibest
made by each group.
The figures Commission possible.
To guard
appear in the
statement of ex¬ against the appointment of any
penditures submitted by General misfits, the Bill provides that the
droves in testimony before the initial appointees shall hold office
McMahon Committee. Three prin¬ for a period of two
years only, and
lions
Approved by Bible
EY}.-• • • ' ::
who has gone through
the engineering and development
of -ithe
erful .Commission in
£ NASD District 13
purposes.
No one
^«yU\. J
v,
Provisions
search
cipal processes were enumerated.
The amount spent for engineering
and construction expressed in mil¬
Private Property:
We.have the bombs; We have
Act indicate, the production facilities. We have
clearly that Congress intended to the engineering know-how.
We
■>
respon¬
military uses of atomic energy.
Engineers and industry also con¬
tributed to a major degree, The
true situation was stated very suc¬
the
sion, its
developmentV; for,
the
■
Act,
creates, that the entire atomic
ine
'
for
this
energy industry must operate, ? It
is therefore fitting that we exam¬
of
f. and the end of World War II.
Contrary ;to " common
belief,
scientists
of
direction
The final surrender of Japan
e.
Congress
year
has passed the Atomic Energy Act
of: 1946 and it i§ under the provi-.
Iianford, Washington.
and
-
"
'»c. Construction of atomic bomb
cilities
facilities and exten¬
new
3. Atomic Energy Commission
fissionable material plants at
Oak Ridge, .Tennessee, and
(
and
which will
existing'.facilities under
Government sponsorship at five
locations throughout the country.
major
two
research
a
program
sions ..to
fissionable material plants.,
,
include
To the extent
plants must operate for
military purposes," just t<5 that ex¬
tent are they hindered from pro¬
ducing
material
for
peacetime
our
V
Charter Member- NcmYorLClearing tfqus^ Association
Member Federal Reserve System
Member Federal Deposit Insurance Corporation
1826
of
our
Woild Trade NotObstructed: Declares Dalton
largest public utility sys¬
of credit which has been arranged stitutions
.(Continued from page 1780)
and the 'T have not
public in, general would be af¬ Assuming At
tems, -and that industry
improvement ;in ^design
the
that,
they would be connected to an in- ;
tercoimected network of several!
(Continued from page 1825)
plants for a period of many years,
i and
in size,
million kilowatts
a
Atomic Energy
j
seen
the
statement.
was thus expressed;
of credit in- their Chairman: .^ ^
'
that agree¬ > "In -the
past ten -days I have'
ment. ...": Things ? would have been
been taking part -at Washington in
ij
much worse both for us and for
the annual meetings <of the Gov-' / *
you—and,, for; you—and . for the ernors of the
International Mone-/ J
United States industry in general
tary Fund and of the International A '
between
our
us, the line
favor arranged in
;
was made, Senatoroperating techniques that will , fected very little by their
opera-j Brewsster is not <so wefo informed;
<oorne through such operation, .can
tion -except as .an ultimately lower as ?other people in This country.
•result in what we commonly term:
cost of producing electricity will; Maine, over which I have jrecent"cheap" -atomic tpow.er ^energy.- I' ,make it
possible to lower electric' ly flown, ids certainly ,a beautiful
would say that it would foe at least'
power bills.
At a later time, the; State, is it net?'"
fo
A;* if we had not been able to ar¬ Bank for Reconstruction and De-'
c ten
years before atomic energy i
electrochemical industries will un-?
These remarks
of,, the'/, 'Chan¬ range that line of credit because vclopment and I am
will -have -any effect upon -elec*
hopeful that»'
.doubtediy have Their town -atomic cellor were made following Ms; if we had not got from you that these two new
international
tricity costs.
•• ■/•/;
ihstif-ft.
power -plants, but in the main, .our address To The (monthly meeting of line of % Credit t o. enable (us to tutions will
foaveVgreat rvalue: info'
Now, w'hat 'will foe the effect of industries will icontinue for-a long •the Chamber of Commerce of the bridge the gap between- the' end¬
the years -ahead for world trade,,
the
^economic
'development- of time to receive their atomic power State -of New York in New "York
ing" of the war and the ending of in the one case bv
bringing more "
atomic piles upon our industries?; over the lines <©f their electric
City Oct. «&.
Reporting his coun¬ Lend-Lease, 'both of which came stability into pur (international;' 4
.v
The 'first 'question as to what ex-|
With -great * abruptness, and thepower utilities.
l,! j try's rapid progress in postwar re-;
exchanges and
exchange rates, "
tent will it supplant coal
and!
Another
important peacetime, conversion, he said that:
1 j point Where we will have built and in the (Other ease
.by building.-u,
other fuels? The .answer is, at will
: "T
wotfld like to
use of atomic energy is in the ipro-i
•up Pur -export trade again to the
up the new' productive resources^
,* -supplant them te a limited extent' duction of radioactive 'materials, in the last
year sinceVrXDaywe< heights that we -desire.";which are awaiting development U L
only r and that
there is . room for medical and biological "pur¬ have made
C-•:
Jv-'1 /
very
rapid,; progress
in many parts of the world.-1
!*
enough in the growth of our idle4-'
Mutual Advantages of the Credit
poses. i This woik is now under; with our reconversion -and ^with
raand for power to .absorb all of:
'"Next year, ■ the/annual meeting *
;
-Mutual-advantages of the credit'
way >on a ,semi-commercial basis.' our demobilization of the men grid;
the uranium that will be produced
is to take place.in London.und the>v
No
outstanding
.difficulties..:-or, women in the tforces -and with, the* a-rrangement. were foited by Sirand at the.same time to keep our,
Governors
have
done
me
ihen/'!!
problems remain to be solved. In building up again of our ^export ;Hugh as follows:^:: •coal mimes,-»our oil Wells and our'
honor, as your President 'has sadd, tiM
fi
fact, the Manhattan District foas trade/ We are already exporting
of appointing me to 'be the chair- *
hydroelectric plants operating at;
announced .1 the
production arid, a .greater volume than we -did in credit rarranged, we Should have
normal capacity.
The offect of'
-man from, now on until that -sin-fofo
.distribution of several radioactive' 1938/ the last complete prewar •had to Put down very heavily.-our.
atomic energy will .be minor eom-:
nual meeting.. I regard .it with c
elements and there is no reason
year.
The volume of our .exports purchases from ^ the United States
pared To the fluctuations In fuel,
great honor- to have been so'
f
why production should not .con¬ is already above that rif the last: of food, >oTtobacco/.?of cotton,- of;
demand -that, accompany changes
chosen and Tshall do myvfoest
tinue,, on -an increasing scale as, prewar year^ and t in;j; terms
1'
industriaa"/ectuipment, / and even
in ?our.fousiness-cycles.
consultation with my ffiends
values ithe (export Trade 'that -We1 ipefhaps we might'not have been
the United States and ;in 'the Ptfoer 4:
r,-What industries ban gen-| .comes indicated*"
fo; fofo'ry j are achieving now is more than able to take some of-your films as
erate .atomic energy to best -ad-'
principal countries concerned to t. v
Another -important. outgrowth double of what it was in the last we sdo now.' "We would have been
V wantage? vThe answer is that onjy
see
that the work of these two
Of the atomic bomb work is in the prewar year, and the curve is ris-1 very sorry, but we might not have
i the very ' largest consumers of
newinstitutions progresses and field that has been opened up for ing,. fluctuations from month, to been -able: to manage it fon' the
advances in- the 12 mpriths lying
power will be able to -consider
the separation <otf isotopes.'
Iso¬ month, fout the
trend c.:is
ris¬ money we had available thenrV
before us."
operating their own .atomic energy'
:,:,;!
;
:
f'Therefore, "at wa$ greatly., to
topes fare forms "of -an element1 ing. We are aiming at balancing
plants.
The atomic energy unit
which differ principally in their our trading accourit, 'our overseas the advantage >of'yourselves and
TVA's Enchantments
is inherently a large scate device.
;
They do, however, (differ trading account, as soon as we can ourselves that this line of credit
It is accompanied by continuous weight.
About to visit our TVA site, the
very slightly in other respects anjd because we wish to pay our wafy was (arranged. :vl remember when
emission of radioactivity.
Opera¬
Chancellor waxed enthusiastic as '
it is quite probable that
their- without needing to enter into any I went to the ^oard of Trade one
tors and property must be pro-;
follows:,
■.'!'
separation and study may dead to further credit arrangements with of the things I had to consider:
tected
by
walls
of
concrete,;
"Tomorrow I am to fly down, to •
was whether we ought to ration
<'
usually- about
six
feet
thick. important developments in .cherri-; anty of our overseas friends. We
Tennessee^-no doubt
there .are
and
metallurgy, fo, Isotopie aim
at
.Supplies were
shoitt.
balancing our external tobacco.
Chemical separation facilities must istry
some
present here who know",
be provided so that, the active ma- study is a practically untouched trade account as soon as possible. We went into it and I produced
Tennessee very well; maybe some :
field and much work foes ahead? I am not naming a date.
That is a ration scheme and I showed it to
terial may
be reprocessed pe-%
come
from that State; I gather
for scientists and engineers in it.
always a dangerous thing to ^do, the colleagues and I said, There
riddically to remove the fission
Time
does
not
permit
the but if I would come back and see are only two things we can do; that many eminent men have come
products which after a time slow
enumeration of the many colla¬
either you must give me a better out of that State in the past. I am fo /
down or stop the operation.
you again in the not too distant
All
going to foe shown -the TVA— •
teral
advances
in
engineering future, I might be able to
of these are factors which will
report^ priority of imports of tobacco Tennessee
Valley
Authority's
preclude
the
development
of! which -have resulted from atomic we balanced our overseas trading from the Unied States and else¬ work and I -am
deeply interested >
where within the shipping pro-,
atomic energy on any small scale. bomb work.
Suffice to say that' account. X would foe very happy;
in what I am to ^ee there.
I have •
I would anticipate that the first
if I coul^'dd .fhat, fout if we -are gram, or we shall have to impose
they have had and wall have &'
been taught by what I have read fo
commercial
rationing,' and one of my col¬
plants
to
be built
to balance
ouif overseas * trading
and heard, to believe that it is a
would be of the order of hundreds profound effect on the future of account, it means two things.--,.
leagues said—not Mr. Churchill—
'Under this ration
scheme fhat Very daring social and economic <
of thousands, perhaps even up to engineering and industry.
:"On tlie one hand we must con¬
you
have drawn up how many experiment which has »now been
tinue to put heavy pressure behind
cigars would I have in a week?' running for -years enough for its V
our
export drive.
It will mean
values to be assessed.
It .has been
i.
I said, 'My dear Andrew'—I don't
that an (Englishman coming out to
watched with keen interest in my
know whether that >is a guide to
New York or Washington will find
who
it was—'you will have a country, particularly by. ^members
British 'goods in-the shops there
of the political party to Which I
Which he mover found at home. dozen,' -and he said, 'We must have;
high priority for tobacco/
The> belong, .and it may well be,: I
That as what the
export drive
priorities have continued and are think, that this first model <of - 4
means, sir. - '
American ; manufacture
have j a
continuing
with you in • conse-;
and
,
.
.
•
,
■
,
■
,
•
.
Continental Illinois
.
| - National-Bank, jj
^
OF CHICAGO
Statement
of Condition, September 30,1946
RESOURCES ;
means we
-have to -send
you'
quence of the line of credit.
; 3 »
things we would very;
much -like to keep to ourselves,
Will Stimulate Multilateral Trade1
but for the moment we prefer the
"Looking to the future," the
dollars.
Well, we must keep the;
Fund Chairman went on, 'I think
export drive going until we have
the stimulus which this credit ar-!
reached the point of equilibrium
rangement is'going to give to your
in our overseas trading account,
exports to us and also to our re-|
and on the other hand we mu^t1
covery,
our
speedy recovery of,
"keep a check on imports into the
the position of equilibrium in our
United Kingdom which are not
trade, itis also going to serve us to
strictly essential."
take a further long step forward
a
Trust Company
and
uli
'
1;
lot
of
Domestic Controls and the Anglo^
/'
-
Gash and Due from "Banks.v..v.-.533,034,982.86
United States Government Obligations
..1,342,454,085.80
,lQther®onds and Securities. .......A.
Loans and Discounts...
tic
cellor continued: "I
379,644,125.69
am
afraid that
people in the United Kingdom,
will have to bear for quite a while
our
/Stock tinFederal Reserve
Bank.3,600,000.00
Customers' Liabilityon Acceptances
longer A .considerable measure -of
what we call wartime .austerity
921,425.12
Income Acorued-but Not Collected.......v..
•
-
,
.5,480;822.23
for the
Banking House.
....-10,575,000.00
si&ss
"■
LIABILITIES
V
'Deposits..
"
•..«............
^>^18,753,132.64
,
shall have to -maintain -for
"You
P21,425.12
fo;•>
...«...
the Board mf Trade,
18408,299.75
NotJEarned.1.,.;
which
I
'kept
was
60,000,000.00
32,056,889.19
were
to seoure
public and trust depoiitt
rtmurred-ortpermitted by law
and the suit
wearing
now
was
word
Of
While
-course
the war
some
people
anyhow,' but maybe they
wrong."
"However, for .a while we will
have to maintain Still considerable
United States Government obligation* and otber ucuritUs aarried
piedied
my
on.
clothes
are
am
said, Tt wouldn't make much dif¬
ference to him, foe foad a lot of
$2,318,753,132.64
and tbr oilKr purpoaes^es
I
bought in celebration of ^V-J Day.
255401.23
60;000,000.00
Undivided Profits.......
referred, sir, to my obser¬
I was President of
vations when
12,937,107.08
i
Surplus
$282,229,233.18
a
longer rationing -of food¬
stuffs and rationing of clothing. - '
$2,134,474,310.27
'Reserve for Taxes, Interest, and Expenses.,..
nt
•«
-
.*
which
for
time, owing to certain gaps
in the arrangements .made, frill
*
;
"
some
development - did not fake
It
may-1 well foe fhat this
new '
should foe copied with ap-
model
>
plaoe.
fo
proprlate variations, of -course
fo
you
wouldn't -want to (copy it fo;
blindly and without consideration
.
of other conditions—*in other
eco¬
nomically imdevdloped regions »of L
world.
the
There
^re.
niver vail-
fully
past and over them, if some .parts
of the world do erect—whatever
tensions
and
•
.between
.different
peoples -which % at first sight
i
are
be—I -am >developing attributable to religious differ¬
perfectly general economic and
ences
or
to racial
or
linguistic
financial argument—if any part .of
the world -puts up such high bar¬ •differences, may in fact foe -atriers and obstructions to the flow tributable' to! inequality, .narrow
part it may
-
the trade can't get by in
quantity, then you may foe . given
back to bilateral, fout that, I be¬
of trade,
second
best for the world and for the
United States and for .the -United
Kingdom. That would foe -my be¬
lief, and your government, like
ours, is pledged to do our best to
get trade flowing on an ever-ex¬
panding scale and along multi¬
lieve, would be a very .poor
lateral rather than
.*
•»
j.
t
.*
,|r
*.
;»'■
bilateral chan¬
.fc
•
#■
a -*
»
.
credit, the loan agree¬
concluded
between
your
Great
government and ours, and the line progress
«-* w
in
would guess you
are
.
the !line .of
f
fulLof poten-
but
resources,
in New York
leys in Europe .which would do fo
cognizant of the im¬ well with an
authority like the "
portance" of multilateral trade, t,
venture to say one address I gave; TVA, and in Asia, perhaps,-and •
a
little while ago said that bi¬ even in that strange, troubled rer
lateral trade is .better than no; gion of the Near ;and Middle East. *
trade at all and, of course, If the
1 think it may well foe that a numobstacles to trade are erected at;
foer of these -stresses 'and strains fo
such a height that trade can'tTlow
I
austerity and 1 would like here to nels.
*■«..
•
speak to you for a moment about:
Optimistic -on Bretton Woods
f
ment
j-i
volume of multi¬
the world.
of the resources
of the whole area,
tial
a
.................
Capital Stock................
;
comforts and .luxuries
while
Reserve for Contingencies
•
of life.
the
We
T
.'
Income Collected but
which I have given
We -cannot yet afford to im¬
port as much as we should like of
you.
/ "
J
Acceptances
;
'
reason
toward a greater
lateral trade throughout
Agreement
Emphasizing the meed for dras¬
domestic austerity, the "Chan¬
43,042,690.94
,v.vw«..*»*.
S. Loan
XJ.
•
form -of public ^enterprise .and
new
the vorganization
confidence
■
»
.!
in imminent
by the Bretton Woods .in¬
development and
well foe that
ards
foe
of
may
ani-
with
*
for
the
-
,,
moment /
Anyhow, this
thought which I will talte
me
it may
which
imminent.
.to; Tennessee and 2 think
well be that America
have taught
the 'Old World
a
-may
others/'
1
*
:great
lesson in this respect as wdfl 3s in
j
?
may
people
so
|
lifting of the stand¬
life of -those
mosities
is the
It
'
best "solvent- of (the
the
seem
a
*>utlodk
narrow
their own future.
upon
p
,:
I
THE COMMERCIAL & FINANCIAL CHRONICLE
164* Number 4532
Volume
1827
unremitting effort by bankers to
«.
U- *f i
i.
y,
sell United States
early
an
and
•■i
ft
i
& l- z.z's i
enactment
-
continuing
which
will
Vincent LaFrence to Be
Savings Bonds;
.
of
plan
"a
Partner in Carmichael Co..
basic
taxation
of
i
individual
encourage
initiative and
man of the Board
A;.?# (Continued from first page)
Of that institu¬
v
bfcen
for
Banking
discussion of country bank¬
a
Detroit in 1933 and has been Pres¬
ing, and ah evening
!•
•
seminar
The Detroit-Bank, since
ident of
lec¬
December,' 1933.
//':
From November, 1942, through
the school, which is conducted by
the Association at Rutgers Uni- August,- 1943, - he- was Chairman,
price Adjustment Board, Central
versity, New Brunswick^ N* J,
i
Procurement District, "Army Air
: Mr. Bailey developed the "Four
Pillars of Income/' an agricultural Forces, covering 13 states, with
in .Detroit.
From
program of his bank, which has headquarters
served to
1943, ; through August,
encourage
diversified August,
farming in the Clarksville trade 1944,. Mr. Dodge was in Washing¬
area..
Z
ton, D. C., where he served as
-'Z-zZZ''. /
''•'
Chairman, War Department Price
Joseph M. Dodge Elected Vice- Adjustment
Board;
Chairman,
/ President Z.
War Contracts Price Adjustment
Joseph M.! Dodge, President of Board, of the War,'.Navy, and
The Detroit Bank, Detroit, Mich.-, Treasury Departments, Maritime
at
turer
{■/
Vice-
was
the
resident
sessions
of
'
.
•
was
■
elected Vice-President of the
Association
the
at
Association's
close
of
Commission, and the Reconstruc¬
and Director,
JBenegbtiatlPn:,". Division of / the
Army Service1 Forces.
,
.
v
Prom August/ 1945, to July,
1946, Mr. -Dodge served as Finan¬
the
tion Finance Corp.;
Annual Convention;
Mr. Dodge is a native of Detroit
and received his education at the
public,schools of that city/He be¬
gan his.banking career as,a mes¬
senger / in/: the / Central/ Sayings
Hank in Detroit in 1909 and
cial
in the performance of out¬
standing services in the war."
States
'
Service
State
Certificate
the
of
United
Treasury for services
behalf
on
the
of
ren¬
War
Fi¬
the
Program. On Sept. 18,1946,
Secretary of War Robert P. Pat¬
terson/presented the Medal for
Merit to Mr. Dodge.
The Medal
for Merit is the .highest civilian
August of 1932, Mr. Dodge
joined the First National Bank in
war award, ranking with the mil
itary Distinguished Service Medal,
and
is / authorized
only by the
Detroit and served
President of the United States for
Commission..
of
...
In
dent and
Vice-Presi¬
as
Assistant to
the
In 1939-1940 he
the
••
■/ "
-
positive
States
?
S, Albert Phillips, the present
treasurer of the American Bank¬
ers
Association,
that
post
First
president
National
Ky,'
He'
.
Bank,
public
Bennett
^
Chair- j.
"exceptionally
in
education
justice and
at
and
of
Division, and
the
committee
SACRAMENTO, CALIF.—Isen¬
hour & Co. has been formed with
other
offices at 2014 ^
spirit
a
vard, North Sacramento, to engage
Del Paso Boule¬
desire to carry on
in
ners are J.
G. Isenhour and H. L.
Isenhour.
Both
conditions
/£:'•>!- V->
'
Z'
the
securities
,;
business.
formerly
were
,/
HAL5TED AT itf rd STREET
(f\
Statement of Financial Condition
the
as
U.
1940-41.
.
JUNE
.
1946
29,
l€'S|Sift;^ES0^CES z^z:.i/5y
Gash
National
chairman of
'
-
'
Hand and
on
S.
in Other Banks—
$23,178,451.20
Government
66,760,770.19
Municipal ahd Other
From
Loans
and
1941-42
Special Loans—R.
the*
Real
he was vice president of
divsion, advancing td the
presidency in 1942. He has served
as a member of the
Nominating
Committee from Kentucky, and
has been active in the Kentucky
Estate
Industrial
P.H.A.
P.
——_
C.
$
—•
$ 90,665,259.46
:' Z'.
5,699,626.57
Participation—•'389,907.08
Loans—Conventional,—:/•; 1,503,456.82
Commercial
and
Real
Estate
Loans—
Building
Bank
Real
Stock
in
:
/1,142,518.10
.'•/•/•V'/ZZ
10,694,836.43
I—*——
608,612.58
1,959,729.86
Mortgage Loans-^-^L,^'
Bank
Association.
726,038.07
Discounts—
I
Estate
Lease—
Federal
on.U.
Liability
S.
60,000.00
Government Securities—
213,076.61
Letters of :Credit«u._i.w-
on
Z.
16,125.00
8,516.23
§1111
Deposits:
U.
LIABILITIES
<
Funds
S.
$. 4,063,951.05
Government
War
Loan
Reserve for
Surplus-'.
Undivided Profits
Z—
■
Liability
-
J—
Letters of
on
—
'
Sigurd R, Anderson
-•*•
Cad K. Withers
the various Division
presidents elected are the follow¬
ing: Carl K. Withers, National
Bank
Division; Ffed F. Spellissy,5
Savings Division; James C> Wil¬
son
State Bank Division* Evans
Woollen, Jr., Trust Division, and
,
.general .sessions
24,
held
of
the
on
Tuesday,
Wednesday, Sept.
and
25, The four divisions of the As¬
and the State Associa¬
sociation
tion
'
Section
meetings
$2vans Woollen, Jr.
on
held
their
Monday,
Adjournment
at
was
annual
Sept.
23.
On
Sunday
o'clock,
State
Committee
held
afternoon
the
a
-
at
two
subcommittee
Taxation
of
Banks
State
oh
Bank Tax
on
of
the
Legislation
Symposium in the
West Ballroom at the Stevens Ho¬
tel. C.
StStfeZ/bSnkers
associations
prepare
noon
on
committee.
• From this
group of re¬
ports; "short oral u summaries of
typical bank taxation situations
needing attention
were
presented.
The basic purpose of this symposi¬
um
to
provide state banking
! represeiitativeg with
information
was
about problems which arise from
the gross
disparity as to tax bur¬
Zz/zz/z/zZ/
/
In some states,
John W. Snyder, Secretary of dens on banks.'
it
was : pointed 1
the / Treasury; Louis Bromfield,
out, the taxes
Sept.- 25,.
-
*
noted
novelist, farmer, and soil
conservationist, and Paul r ttoffriiari, President of the Studebaker
Corporation,1 and head of the
Committee ori Economic Develop¬
ment,''were among the national
leaders scheduled to address the
•
sessions;
The
;>/: /
convention
;
-'V
"
Z
upon
state
banks
which
are
not
imposed
Upoii/national.-; banks
tendsk to
cause
conversion
from
state chartered to national banks.
In some states
also, heavy proper¬
ty taxes on bank Shares discourage
the building up of capital funds.
Edward
Elliott, chairman of the
subcommittee, who is also vicepresident, Security-First National
Bank, Los Angeles,
California,
preceded
by a full day of meetings of the
Association's commissions, coun¬
led the discussion.
cils, and committees on Sunday,
Speakers at the general sessions
Sept. 22. A reception and tea was
tendered to the delegates by the included retiring President Rathje,
Chicago banks that afternoon. A who is President' of the Chicago
Sunday Evening Hour followed City Bank and Trust Company:
was
at 8:30 p. m., featuring a song re¬
cital by Lawrence Tibbett and
an
address
Baxter
in
of
Snyder, Secretary of the
Treasury; the Honorable Leonard
by Bishop Bruce R.
the Methodist Church
Portland, Ore./
on
the subject
ei "The Year of Decision/.!./ J
:
:
Edwin
'
,
mer
ijh
::
;,5
Carson
J. Carlisle Rogers.
\
: "kibgton, K.C., LL.D., for¬
Special Wartime Adviser to
Governor General"Of -Canada;
and former Counsel
fairs
to1 the
Information
on
British
in
Empire Af¬
Minister
"'Z
Arthur A.
Member
-,
of
Member
16,125.00
Z
,
''James McHugh
*
•
-
Lawder
Federal
Federal
Jf.
Reserve
.
..
Z"
John Mueller
:
'
•;
Z
Max Patinkin
y.'
Adolph Quist
.
ZZjZZZ /
System
Deposit Insurance Corporation
London; W, Ran¬
dolph BUrgessiViCO chairman; of
the board of the National City
Bank of New York, and former
ABA president;
and Robert M.
Hanes, chairman of the ABA Small
Business
Henry F. Jaeger
Z-Z/''■• Chester W. kulp
Heidel
2,754,434.32
w
Fred H, korthauer
-
t
;
Z
Frank G. Rathje ■' :'//;Z.Zz: Z/Z'Z.''Z Z:Z /'ZZ';/'
Morris'Z.-Holland 'yZ/,:\W. H. Mcbonnell
'
:
.•
•
Peter DeVries
Charles W.
4 }'' statements on bank taxation for
their states for study by the sub¬
/
/'Coiwe^ion^Proceed^ugs/v '
Sept.
James C. Wilson
Rogers, State Associa¬ shad their tax authorities
tion Section:.
•
Hans D. Clausen«
Fred F. Spellissy
Among
were
169,328.72
1,000,000.00
/ :
541,170.24
"Z 213,264.08
Credit^-*w-'Z—
Z-Z' /ZZ/ZZZ/ZZ-.:/-:"
The
$ 99/326,541.27
Taxes, Interest and Insurance——-——.a—
Contingent Reserve
.
/'Z/Z'Z-ZZ
Capital WW.———$ 1,000,000.00
■
■
convention
;Z-
•
5,638,935.45
Tax; etd., Deposits_iw—Z
Z':'"
176,205.56
Other Deposits—;• 89,447,449.21
All
fi Zi '"
J* Carlisle
Account—
y'JF.H.A.
:
_
"
t
Public
.
•
1.00
—
Reserve Bank___.^
Accrued Interest
Customer^'
.
Part¬
with Davies & Mejia.
Othei Resources
•
-V
and TRUST
commer¬
Council;
the
Membership
Committee; ex officio Bank Man¬
agement Commission; the Execu¬
Committee
:"'r'
"
CHICAGO <
CITY BANK
com¬
tive
tive
&
Sue
the
Bank
.'
'
a
Duff
under.
a
trade
all concerned."■
College,
at
formerly
was
Robinson
Laurel
and
Williamsburg,
con •Bankers
meritorious
c
.
with
J;
j. Isenhour & Co. Formed
econ¬
by the United
relation
Frence
in
Co.
that will be of mutual benefit to
of the
Lon¬
Cumberland Col¬
don, /Ky;/ and
lege,
its
La
partner
educated in
was
schools
Memorial
to
Louisville,
born'
was
County, Ky;- He
the
Of
was
vice
in
foreign
reelected do
for another year.
Mr.
Phillips is
position"
countries, Which "reflects
'■/
••
.
admitted
1 Wall Street, New York City*
Mr.
omy; and adoption of "a firm and
Business Credit Com¬
mission.
be
Son,
management and of the
a
curb on bureaucratic
nationalization of productive
the
of
Association
member of its Post¬
a
Small
war
Council
Bankers
and is now
meetings.
fnember of
was a
Executive
American
will
partnership in Carmichael & Caf-
University
Of/ Military Government,- Berlin, of;; Kentucky, Lexington.
'/•' In/the {activities of the.Ameri-;
Germany J-'; >. y/fz
Zz7Z7/zi:Z'/>
On March 11, 1946, Mr. Dodge can
Bankers.
Association,
Mr.
was
awarded
the Distinguished Phillips has served on the execli*
nance
secretary
a
as
17
Oct.
on
controls, particularly those relat¬
ing to the use of consumer credit,
government loaning and guaran¬
teeing agencies, as well as price
Controls; a curb on trend toward
speaker on bank operating topics
at bankers' and business
cial
the
became
many com¬
mittees of the MBA and the ABA.
He has been in much demand
LaFrence, member
bor, of
people;
on
pleted his business and
dered
later
Of the
tion and- has served
H.
which will define the rights of la¬
Dodge is the past President
Michigan Bankers Associa¬
the Finance Division of the Office
firm of general accountants, re¬
turning to the banking business as
an
assistant examiner, later be¬
coming the senior7 examiner, in
Michigan State Banking De¬
partment. Subsequently he joined
the Michigan Securities Commis¬
sion as a special examiner and
Mr.
Military Governor and Director of
rose
through the" various departments
to the. post of general bookkeeper:
Then he became an auditor with a
the United
Adviser to
private enterprise";
new, fair and just labor legislation
duct
President of the National Bank of
Graduate School of
The
tion in 1932-1933., He
member of the faculty of
a
Vincent
df the New York Stock Exchange
Credit
MUTUAL NATIONAL
BANK OF CHICAGO
Commission, for¬
ABA president, and President
of the Wachovia Bank and Trust
mer
H/U5TED AT 73th STREET
Company, Winstort-Salem, N. C.
:
Speakers
heard
at
divisioit
included ' William
L.
Statement of Financial Condition
/
meetings
JUNE
Clark, Vice-President Of the J. I.
Company, Racine, Wise.; H.
R. Farrall, advertising manager of
the Warren "Tribune Chronicle,"
Warren, 'Ohio; Carl M. Flora,
Cash
U.
the
ABA
Consumer Credit Committee; Paul
Hoffman, president of the Stude¬
baker Corp., and head of the Com¬
mittee
on
Fred 1.
Municipal
/
Securities—
Other
chairman
and
sion of the
Marine
Of
Federal
Calif,
A*, San Francisco,
V- " :!a
Resolutions
■
t
V^/y.
.
:
y
Z The convention, before adjourn¬
adopted resolutions urging
reduced Government
spending "to
ment
figure
ment must
the Govern¬
provide'*;
a continuous
6,901,506.84
"/•
•
in
Other
Resources
Reserve
Federal
Bank—...—Z*.
ZZZ*.
Zv:ZZ 108,829.39
■
Public
U.
S.
!
r"
'
LIABILITIES
f:
Deposits:
27,000.00
...
"
,
\,7
.
r
$50,564,642.14
a
i
•
-
,
$ 2,100,147.91
Funds
War
Government
Loan
Account———
2,543,71^61
Housihg Admihistratioh Tax, etc.,
i-:,
...._—240,460.96
Other Deposits
44,404,751.54
Federal
Z
"
,
Deposits
All
-
Z
Reserve
for Taxes,
■"■
InSurance^^JU^^—80,695.79
—
—
500,000.00
$
f25,000.00
^7,552.73
.
Profits
——
Contingent and Other Reserves^.i—162,315.60
.
•
$49,289,078.02
W
Interest and
Surplus
Undivided
;
^
•-
/
,
•!'
"
Albert Inlander
C. Rathje
Fred H. Korthauer
V * Frank
Harry A. Flschef:
Arthur C. Kussman
,
.
Z
r
"
Member
•.
1,194,868.33
$50,564,642.14
DIRECTORS
commensurate
that
Z-
,
;'Z''-V.V
1
■
Stock
With the maintenance of those eSr
sehtial Services
745,272.43 Z
-
,
1,958,321.69
r
*
'
-v
.
Building—Furniture and Fixtures..230,488.05
,
the smallest
$43,296,817.86
3,453,384.03
i 308,194.01
436,334.68
Mortgage Loans.
•
Capital
•,
Adopted
$
;
Administration
Housing
Z/'Z
1,813,358.45
Z
—
';z/i
Bank
ABA, and director of
S.
Z
:
z"^//S:
$13,718,319.35
^7,765,140.06
G.I. Home Loans—.
Company, New
York; and R. A. Peterson, vicepresident of the Bank of America
and
—...
R.F.C.—Participation Loahs
the
Commis¬
Bonds
Discounts..
,
Kent,
;
Real Estate Loans—Conventional-
thfc Bankers Trust
T.
and
and
_Z_„
and in Other Banks.
Government
Economic Development;
Commerce
N,
Hand
on
S.
Loans
Vice-President of the First Wis¬
consin National
Bank, Milwaukee,.
Wis., and chairman of
1946
29,
RESOUkCES ;Z
Case
-
r' V•
_
Arthur G. Rathje
^Elmet1 Hafpef
Chester W. Kulp
Roger Sheehy
Federal Reserve System
Member Federal Deposit Insurance Corporation
THE COMMERCIAL &
1828
FINANCIAL CHRONICLE
Thursday, October 10, 1940
Waiting Period." We felt that the
Regulation of Securities Market
Postwar
know
provisions of the Security Act
able
garding
waiting
re¬
solicitation
through the
should be modi¬
period
have
did not
or
basis for
stated
to
a
reason-,
believing the facts
77
be untrue.
Now, I don't suppose that these
of the All Classes of Issues?" We con¬ fied
so as to permit acquaintance
cluded that it should not be com¬
recommendations meet with your
most important requirements of
and expression and attitudes of
uniform approval.
pulsory for allotypes of issues;
I only know
the postwar period is a healthy
interest, although, the actual sale that they are honest and that no
and
expeditiously
functioning that no hard and fast rule should of
riod.
-v 7/77.7'./;.;'
7,
securities may be deferred.
be laid down in view of the rela¬
influence was
brought to bear *
It requires, of course, but a mo¬ capital market. Only thus can we
"Labor and Salaries."
"Cost
tive strength, and also, the rela¬
upon the writers from any source *
ment's reflection to realize that if hope to maintain a high level of
of Production."
;
7/
tive weaknesses of both the com¬
whatsoever.
employment and realize the rapid
costs, payroll, raw materials rise
Wages and salaries constitute
increase in production and stand¬ petitive and the closed type of
I should like to warn that even :
50%, that it is necessary to have
bidding. 7 Moreover, there is a some 70% of the total national in¬ if you should at
ards of living of which we are
any given mo¬
50% more funds tied up in busi¬
come.
If
you
cannot liquidate ment of
technically capable.
The imme¬ point that these things change as
time evolve a proper sys- 1
(Continued from page 1782). . .
get this picture of the pressure of
rising prices in this 1921-1931 pe¬
Likewise, it is
operations.
ness
to realize that new plant
equipment will also require
creasing capital investment.
easy
and
in¬
period, 1913 to 1920,
the level of wholesale prices rose
Now in this
little disagreement that one
task, therefore, is to remove
obstacles which prevent or
retard the employ of funds into
new
capital investment, at the
same time of course, with due re¬
diate
any
,
gard
the
to
roughly 10%. In contrast, the in¬
dex
of physical production
re^ yesting
Now,
mained almost, unchanged. Thus,
had a period in which we had,
for all practical purposes, the fis¬
cal output of industry remaining
we
interest
of
the
in-
act and behave/ You can
period of competitive bid¬
they
have
a
ding when interest rates are eas¬
ing slightly and the underwriter
gets out all right, the customer
gets out all right, security rises in
price ; and
nobody particularly
public.!'.,
/
complains or worries about com¬
we did assume that in any
petitive bidding.
<
; :
system of regulation the interests
/You can have a period when in¬
of the investor should be the pri¬
terest rates tend to
firm
a
little
consideration. But, and this
bit and the underwriter doesn't
problem,. how far. can
constant and imposed; upon it ,a
have $ie advantage of an easy in¬
you go in 'protecting, the lhvesfor
10 % jtrice increase/ The effect of
terest rate
situation.
Then you
that situation upon all phases..; of by law without too seriously im¬
not only find the security hard to
the security market is quite evi¬ pairing the necessary functioning
dispose qf, the purchaser may
dent. Increase in bank loans, in¬ of the capital market, "And I
find a decline somewhat in price,
crease
in issues, especially com¬ would underline "necessary func¬
and you may help to tie up the
ing out after the war, volume of tioning of a capitalist market."
general market.
Our -feeling r is
security, flotations of bank loans
Indeed, if regulation goes very that both types can be defended
paralleling the 10% price increase far, I ram afraid, in determining for
particular situations.
-while the physical output of indus¬ what " is sound: and what is : un¬
Price Stabilization During
try remained relatively constant.
sound, it really must determine
the exposive possibilities
of all /:77,7; 77/7Flotation
r*
:; • 77: 7/
Money Market in '30's
' expansive periods at their birth to
/'Should Stabilization Be Per¬
J; Now, we go to the '30's. and anticipate the future... Neither mitted During the Period of Flo¬
there
we
found 7 the 7 physical laws nor men are that wise. And tation?"
In
view
of
the
safe¬
volume of industry declining but perhaps even worse, if you at¬
guards thrown around the trading
tempt to go very far with that it of
at the same time prices declining
exchanges, especially during
and we found a growing feeling will envelop you in controls and the admirable
leadership of Emil
that a certain eclipse was throw¬ controls and controls which will
Schram, we saw no 7 particular
ing a shadow across the opera¬ prove not only inconsistent with reason why that institution would
tions of the money markets. And,, private enterprise but which can be
mary
is the real
■
•
.
there, with philosophies that this
was not temporary,
that our in¬
dustry,-: that
our
society,
had
reached a stage of maturity in
self
could finance
business
which
Well,- the outbreak of the war
changed the situation of the 193Q's
immediately. But the change was
not clearly indicated to many peo¬
ple because of the many ways, di¬
rect and indirect, by which-- the
government was meeting the phys¬
ical needs of business during the
•
government-
supplying
by
governmentAlso,
business¬
owned buildings and
owned
;
\ plants.
had
men
physical
the
fact
-
^
f! Our studies
as
from
thousands
with
not
customers.
that
in
matters resulting from
they were dealing with
and
one
economies
certain
the
led
us
!to
of
1
- •
believe
government
retired
financing
fields, and
as
and -purchasing
consumer demands
for
peacertxme products asserted
themselves, there would be a need
for funds in a generous quantity
from all security fields including
talist
otherwise.
or
Recommendations
,
.
securities
as
sound 'in the-
sense
their value will be maintained
that
the
properties which
represent will earn profit"
or
they
Now you 'may say many mem¬
bers of the SEC will agree utter¬
with
that • statement.
They
they have in no sense de¬
viated
from
the
spirit of that
ly
claim
77/
some
We
think
we
found
evidence to lead one to rea¬
sonably disagree with them, par¬
tion of
ticularly, in the early days of the
functioning of the SEC. V;7;;7;7/
an examina¬
security regulation. I will
read from the book the statement
recites
examination of.
an
the regulation.
Competitive Bidding
The first sentence
'
refers to what has gone before. It
says,
"In
any
case
there
can
t
.
/The second issue, "Should Com¬
!
,
.Banking/
„
¥
as
suggested by William O. Douglas,
Chairman of the Commission, to
Decentralize the Investment Bank¬
ing System?" Our feeling was in
view of the set up of the char¬
acter of American business enter¬
prise and the abundance of funds
which have been available in lat¬
ter
investment
which
been
needs
the
and
years,
adaptation
banking
has
making to accommodate the
of
business,
medium
we
see
and
no
small
size
reason
at
present for attempting to force
greater decentralization. V 7 V
Simplication
of
Regulation.
and
Directors
of this Bank
/ 77.7.77r ■■7'\;v.-v-'-v--,
7
'
Wish to extend
express
done
'
„.
greetings, and to
appreciation for the work#:
by the Association in the*
interest of sound
1
'
-•';#'
banking.
William J.
Field, President.
Commercial Trust Co.
OF NEW JERSEY
Jersey City, N. J.
Capital $3,400,000
•'<
,/>. ;
Surplus $4,000,000
MEMBER FEDERAL RESERVE SYSTEM
MEMBER
FEDERAL
of
those
factors,
lowering costs, but it is our feel¬
ing, for the period which lies
ahead, there is not going to be a
serious liquidation of/the price
So
it
be
settled
our
is
problem which cannot
a
once
and for all, but
outstanding' purpose/was to
call attention to the fact that
need
the
need
them
to-be
operating in a
J
hour.
will
more
If
,
you
just
will
jump
excuse
and
me,
make
I
one
bility that aggregate
ings
money sav-7
be expanded relatively
may
to
consumption, while at the same ;
time the amount of savings funds ;
available for investments in new:
point in closing.
Importance of Cost Structure
i
*
healthy condition. ' 7"
: /
;-'7 '
>*777/ /■ S7 7777\ ■
have vhlread^'; gone a,'.half- -vWe,; thus/ arrive at the possi-7
structure.
7
we,
securities markets.; We.
securities
This
cost
structure, this situa¬
we need a healthy,
functioning market, is even more
important when we consider the
present situation with respect to
savings. There is a tendency, of
tion for which
course,
for aggregate savings to
increase
national- income
at
ex¬
pense,;:/-; 77-7/77;;. 77if;;#:''77;
recent years, however, the
increase in income has been pri¬
marily in the lower levels where
be
quite
limited.;
tively large aggregate of savings
same time a relatively
and at the
small supply of equity money.
In
that situation, you see the prob¬
lem /of
the
investment
banker
and the need to look toward
ping
In
may;
In other words, we may be in a
situation where we have a rela¬
tap-*
greater portion of the in¬
a
;
group, whose savings, other¬
wise, will not be available to the
come
investment
market.
„
This
situa¬
the
proportion saved is relatively tion may, of course, affect inter¬
At the same time, the high est rates a bit and the
price of
income groups have faced high
money. The more important con¬
low.
DEPOSIT
INSURANCE
'
'"
'
CORPORATION
postwar
period roughly .40
60%
above what they were
1940.
to
in
Now, that is a high level of
cost, and it brings in a big prob¬
lem of financing. It is our opin¬
Chas.
Slaughter & Co.
Admits Serguis Klofz
Charles
ion, also; that this cost structure
prices are likely to remain
about in these levels, 40 to 60%
and
above 1940; If you
stop for a mo¬
yourselves a question,
"Well, can't these costs be liqui¬
dated?"
your
next question is,
"Can you liquidate costs?" "Will
you * liquidate
labor
cost s?"
An
organized
labor movement
now
totals 15 million people in
contrast to five million at the
end of the last war, and a political
situation which makes politicians
receptive to votes, a strange thing,
gives this group power to resist
any serious liquidation.
Turn to another field of cost,
ment to ask
,
agricultural prices. It has been in
the main above parity, well above
parity. We have already prom¬
ised to support them at 90% of
Beaver
Slaughter
Street, New
& Co., 66
York City,
members of the New York Stock
Exchange, announce that Serguis
Klotz has joined the firm as a
general partner. For the last year
Mr.
Klotz
has
been
associated
with
Glore,
Forgan
&
-
and
Co.
prior to that served as a lieuten¬
ant on the Headquarters Staff of
Admiral E. J. King.
/7:/-7:'
/
Mr.
his
Klotz
spent
has
investment
career
much
of
in the Far
in
Swan, Culbertson & Fritz in 1934
He
East.
and
from
became
1933
to
a
partner
1940
he
man¬
aged that firm's office- in Manila.
He played a leading part in the
development of the Manila Stock
Exchange and served as its Presi¬
dent from 1938 to 1940, when he
became
manager
of his firm's
Shanghai office. Foreseeing war,
parity two years after the war,
which is rather technical. I might 92 Vi% in - the case of cotton, and Mr. Klotz left the Orient in 194V
After a year with the U. S. Treas¬
call; your attention to the fact there is enough political pressure
Department, he joined the
that in the original draft of the to*suggest that, perhaps, instead ury
''.
:777;'
security regulation it exempted of reducing those support levels, Navy.
from its provision not only rail¬ we may increase it or we may in¬
Having graduated in 1929 from
roads but public security utility.
Stanford
crease the period of time in which
University,
where he
In view of the fact of the de¬ the Government will rush to the majored in economics, Mr. Klotz
entered the investment business
velopment of the holding com¬ support of that price structure.
pany situation, the increased con¬
by joining Conrad, Bruce & Co.
Liability of Issuers and
trol that states have taken over
in his hometown of San Fran¬
We then took up the question
••
some
;
.
"Should Attempts Be Made,
petitive Bidding Be Required for
be
Officers
-
the securities
over
markets, times, conditions change,
and
you
will continue to have
problems as new situations arise.
"Should the Several Investment taxes, which have greatly restrict¬ cern, however, is that we need to
Functions Be Segregated?" That ed the potential income among
keep the security markets, the
is, separate your house of origina¬ that group. Now, the great bulk securities field, the money market
tion from underwriting, from pur¬ of the population in which savings free from any semblance of mis¬
chasing/ and
distribution.
We seem to be shifting, channel their conduct. While, at the same time,
think that those suggestions that savings customarily through in¬ we reexamine the security legis¬
have been made by certain speak¬ surance, savings banks, and social lation of the 1930's in a detached
ers from time to time are prac¬
security funds. These funds, in manner, asking ourselves a ques¬
tical.
'
*
turn, are invested by these insti¬ tion whether there is duplication
tutions and are not available for and overlapping of controls and
Is private placement desirable?
>v
/.7'77 / ,, unnecessary multiplication of de¬
Our
conclusion
is, that it can equity purchase.
serve a function in raising capital
:
There is need for taking notice tails, so that cumbersome situa-j,
but that we feel the direct place¬ of this postwar situation.
Costs tions arise which hamper a broad/
Our estimate functinging of a healthy invest¬
ment should be permitted to the have been rising.
same regulations as public offer¬
was
that costs, and that means ment market.
ing.
'
selling prices, will emerge in the
simplifying
The
offset
can
tem of control
,
>- We then turned to
which
///
-
prices seriously; or
liquidate labor costs
seriously, you are going to have
a
high cost structure and a high
price structure. Now, it is true, in
time, technological improvement
if you cannot
»
(
statement.
Regulation
badly abused.
cumber¬
to
as
Well, perhaps,, at this point I
should turn roughly to the rec¬
ommendations.
Maybe you have
read them, maybe you haven't. I
will run through them very hur¬
riedly.;; O appreciate your time
is limited.
The issue,. "Should
Regulation Go Beyond Preventing
Fraud
and
Requiring/Adequate
Information?" Our point of view
was it can be. It is expressed very
well by quoting President Roose¬ ;
I won't take time to go into that
velt who said, "In recommending point of view.
I know some of
the Act to Congress, the Federal you may disagree with it, but I
Government canpot
and should will leave it to you to read the
not take any action which might book.
be
construed
as
approving or
Decentralization of Investment
guaranteeing the / newly
issued
banks, security exchanges and all.
Security
and
impoverish eco¬
nomic7 enterprise. whether capi¬
largely out of its own earn¬
war,
detailed
so
so
it¬
ings, 1930 was taken as a model
if it were a norm. /
/
*
~
■;
become
some
agricultural
security
of
regulation,
operating companies, and in fact
the laws of most leading states
Underwriters
cisco.
turn to the question
His admission to partnership in
exempt from regulation of secur¬ of "Liability," pointing out that Charles Slaughter & Co. was pre¬
ity public utilities, corporations the burden of proof rests upon the viously reported in the "Chron¬
regulated by state and Federal defendant;
that the
provisions icle"' of September 26th.
commissions listed on recognized also apply to misstatements in the
stock exchanges and legal invest¬ reports
of a company required
ment, we though a similar sug¬ under the Act. That the director
Frankenbush to Admit
gestion might be adopted by the may be liable even if he did not
Frankenbush & Co., 25 Broad
Federal Government.
sign the registration statement or
We Street, New York City, members
We took up the matter of the even know of its existence.
duplication in statement. You are
familiar with that. "The Question
of
the
Wating Period and
What
Should Be Permitted During (fee
Finally,
we
thought it would be reasonable
that a party should have the right
to set up as a
liability
the
defense against its
proof he did not
of the New York
Stock Exchange,
will admit Henry Leon
to limited,
nartnership in the firm on
Oct. 17,
.Volume 164-
Number 4532
Some Aspects of Investment
(Continued from
important processes or products ol
the corporation obsolete, that
1783)
page
when accumulated
savings
available for investment in
were
there has ben
busi-
of
"
^
price ' AXXUAVMvivlijjj
limitations,
V
vliv
one
*
an
important
tions
the
ment
of
the
invest¬
of
investment
Functions
r
Then
The
;
r
eludes the
orginating,
^
function
finding of
*
can
use
need
are
-
a
The
hearing about
•
all
in the
••
the
second
as
ufactured and the demand therefor, the industry itself with its
competitive conditions, which enables us to test the
investment
credit of the corporation.
Some¬
times this phase has been
mini¬
mized
;
-SUe
in
haste to bring the is-
a
'Out.
It is
result
'• y
too
of
"is! y ;
early to appraise the
the
market but I
past
easy
money
convinced of
am
one
fact—that had it not been for the
registration requirements of the
Securities Act of 1933
many Sept.
30 balance sheets
submitted to the
SEC
would
'
actual
have
and
shown
contingent,
some
liabilities
arising
from
underwriting.
Chairman James J.
SEC
■
As
Caffrey
pointed out in his initial address
at
the
State
trators'
Securities
dinner—
v
Adminis¬
V'i-
'
"The
in advance
of effectiveness
tendency to
statements
well
as
protect
and
to
has
a
those
bearing
protect
filing
liability
investors."
But the fact that there
has been
filed,
required by law,
as
tration
statement
effective
come
which
by
regis¬
a
has
be¬
of
the
action
Commission does not afford a de¬
fense :„to the investment
banker
when he is sued because of
a
false
or
misleading statement.
Now,
Whether you originate as the
prin¬
cipal underwriter or merely take
a
>■
position
in
the*
underwriting
group, you must be able to prove
affirmatively that
4<after
had
you
reasonable
.
investigation,
reasonable ground to believe and
did believe"
'J.
.
that
ry.\:
..
to
Such
J
*'were true and that there
omission
to
required to
state
be
a
necessary to make the statements
therein not
misleading."
4
Investigation
Accordingly.
Investigation—the
second
operation in the origina¬
tion function of investment bank¬
1
-
•
examination you
an
better
tion of investment
is,
Negotiation
banking—that
which
—
which
process
is
the
determines the
amount, the price, and the terms
of the proposed issue. " V,'
You
know
now
the
amount
of
capital the corporation
may prof¬
itably use in the business and the
purposes
pended.
for which it will be
As a result of your
amination
the
into
the' business
ex¬
ex¬
and
industry
you are better able
a price — not
wholly
price the; public will pay
but,what price will be justified
by reasonably expected earnings
to determine
what
and
dividend
you
payments.
better
are
cide
the
Lastly,
equipped
terms
of
the
to
de¬
proposed
In line with your
franchise, that there is a technological change in the industry
Which
will
make
the
purchase the issue) the firm may
withdraw from the
underwriting.
Thus, there will be two' "outs"-L
the first to be
the
whom
the
issue
have
will
be
determined
corporation's plant,
certain
preferred, to
ration from
preferred
fault
and
in
any
(in the* event of
of
save
take
the
you
The
issue
function
not
alloted
price
less
of
invest¬
the form of
the tenth day
registration statement
say,
becomes effective. Such
ment
(in
.composed
be
may
of
-retail
of
amount
to
them
securities
a
stipulated
at.
the public offering price
certain fixed discount.
•<
As you have noted, the trend
today -is to have larger under¬
writing groups. Many dealers who
formerly participated only on sell¬
ing group terms have undertaken
the
underwriting task. When in¬
!to join
vited
remember
position as
will vary from
your
anunderwriter
that of
a
(1)
an
As
be
an
enables the firm to
individuals
To
conditions,
tage
agree-
test its
to
won¬
Stable
underwriter
able
to
brokers
Frank
the
peace
veteran
the
us
political
problems
"
that
">'
:
of
to
as
these
tis is
face
should
by
be
they
attained.
one
From
can
that
23
business in California
•
•"/'
" ' -'
tion
-
firms
and complete;
(2) As
sued
if
statement
•
-
the
the
in
in
12
stock
princi¬
commodity ex¬
and
changes.
The Depart¬
In addition to regular
exchange business, the firm
stock
has
of
one
the
largest organiza¬
tions in the country for the distri¬
bution of
new
security issues and
issues not traded
change.
co¬
on
PERSONA! TRUSTS
Board of
it
would appear that your total
tributed
if
you
Vwith
out
to
the
are
respect
of
to
*
FRANKLIN B. LORD
which
given.
a
As
it
is
a
the
among
:
For 56 years we
sonal service.
bring their
This
many.
com¬
have
have specialized in pert
Many of
accounts
tion of friends
; E. TOWNSEND IRVIN
STEPHEN C. CLARK
or
our customers
here at the
sugges¬
relatives whom
wo
jl
long served.
'•
r:
»
?
CHARLES SCRIBNER
h
->"•
*■—■
*
■
CHARLES S. BROWN
RUSSELL V. CRUIKSHANK
DE COURSEY
FALES
CHARLES J. NOURSE
subject
CHARLES S. McVEIGH
series of talks could
to
^
O'DONNELL ISELIN
The "After-Market"
the indi¬
specializes in serving; the indi¬
vidual in banking and trust accounts. ;
JOHN A. LARICIN
r
of trusts,
to
merely the business of one
HENRY W. BULL '
■
stabilization, and
not
care
belonging
pany:
RUSSELL E. BURKE
share,
$100,-
the last step is the "after-market."
You will again hear more about
audi funds
department
President
BERNON S. FRENTICE
200,000 shares offered
000.
; -
•
STANLEY A. SWEET
shares
to the public at 20 per
your total
liability is
Fulton Trust, the
vidual is
ARTHUR J. MORRIS
underwriter
5,000
At
estates
Chairman of the Board
public. Thus,
an
Directors:;t
EDMUND P. ROGERS
'
'?
"after-mar¬
WALTER N. STILLMAN
ket," the chances
are that it will
be to your credit jf the issue has
been bought right and
7
properly
FULTON TRUST COMPANY
placed
with
investors
and
not
free-riders put in for a quick turn.
*
To
conclude, I should like
to
OF
re¬
pricing an
important, there are
other important
aspects of invest¬
ment banking, such as the Investi¬
gation operation in Origination
sure
of
the
facts
and
YORK
NEW
■
•••■.•
state that while proper
issue is very
Make
ex¬
correct and
However,
person.
stock
any
'
•
-
ftfatcUvicM
complete * and sued by one
who purchased the issue from
another
states. It
'-fl
may
;
1002 MADISON
.v.-'
,
.
149 BROADWAY
•
.:"
"
.
•
(Singer Building) NEW YORK 6
AVE.
(Bet. 77th & 78th Sts.) NEW YORK 21
.
•?: ■"
1879, it has expanded inta
,
you
-
country.
you
registration
was not
•' *
Stock Exchange and other
production and trade of the United
States.,
It has the obligation to
play its part in carrying out the
policies of
correct
^
,
underwriter
an
be
-
beginning in Bos¬
investiga¬
was
•
-
of the oldest investment
offices located
pal
or
responsibility to assist the sound
development. of
the
industry,
you
statement
'
has memberships in the New York
ment of Commerce has at its basic
had reasonable
ground to believe the registra¬
/
As¬
Manning
manager.
Stevens
tion and that after such inves¬
tigation
a.
years' service in
is
modest
a
ton in
fundamental
which
him
banking
objectives, but there are naturally
wide C disagreements - as
to "the
methods
:
Paine, Webber, Jackson & Cur¬
is, I believe, little differ¬
of opinion
in the United
States
four
investment
There
ence
of
for 18 years.
'
~
v
L.
Navy, is resident
sisting
People the world over
looking to us for leadership
solving the economic as well as
all.
an¬
office
who has been connected-with the
are
the
underwriters,
ment business in California and
the world.
in
r
Patty, with a back¬
ground of 15 years in the invest¬
more
as
and
the opening of an
at 626 South Spring Street,
nounces
must
you
prove
reasonable
a
ex¬
duction is the most solid founda¬
tion for the
prosperity of this
well
>
ANGELES,
CALIF. •—
Paine, Webber, Jackson & Curtis*
nationally established investment
goods for
better life of
More and steady pro¬
as
•
LOS
rising production is
the only way to maintain a
high
level of employment as
well, as
country
spe¬
Angeles Branch
Los
and
have available
the' security and
own
Paine, Webber Opens
products.
our
our
The welfare of the
effectively.
destruction
thereby provide
unfairly
as a whole is of overriding
importance to each of us.
I do
not; I think, minimize the diffi¬
culties, but I have faith that we
chn and > will deal with them*,
ple and, through trade and sound
financial'assistance, to enable the
people. of. other countries to re¬
-
of
further
country
problem now is to direct our abil¬
ities to production to meet the
peacetime needs of all of our peo¬
build/. the; disastrous
and
we
cial interests.
productivity and to de¬
new
as
groups and par¬
must not take advan¬
the present dislocations
ticularly
pro¬
the„;^ongress, to
dealer in that—
made
:
underwriter^
an
as
that
The second step in Distribution
be a stabilizing operation and
best efforts commitment. To
my
the
these
velop through science
may
outright purchase, such as in
competitive bidding situations, or
after
group
—
a
•
an
on,
fon
underwriters
dising 'the
be
take
is
to-the
underwriting " agreement' but
who assume the risk in merchan¬
upon
issue
of
is the
selling
a
issue
the
only
an
may
>
dealers who do not participate in
agreement
the
disposed
of
the
included)
agreement to ob¬
tain the required
capital and the
a
- .■•
de¬
banking is the Underwriting*
This involves
and
derful products and methods now
available fpr peace.
Our basic
salable but
more
materials
well
as
good
central
'• v"'.'''
finding serious
basic
and
will on all
clarity about our
objectives, is of prime
importance. We must all earnest¬
ly attempt to understand the point
of view and problems of other
sides,
I
meet and solve these
been
of
enormous
underwritten by you and dis¬
grief in the future.
second
•
of its
a
Underwriting
ment
calamity-
a
underwritten
and
mation
dividends),
may
shortages
overcome
liability is, generally speak¬
ing. limited to the total offer¬
ing price of the securities
provide for voting power.
In so many ways it is
possible
for you, as the
sponsor of an is¬
sue,
to
strengthen
the
picture
prior to the public offering. The
you
and
which
to
action
country,
of products and commodities.
everyone.
percentage of the
prohibit the corpo¬
payment
have
inated
of
purchasing
this
'V;.'■.
to
sinking fund of
net profits to
redeem the
preferred, to condition
salary increases upon the approval
a
We
banking is Distribution —' the
entire process by which the
orig¬
a
percent
of
The last function of investment
*
by
because
hurricane destroying the
as a
pro¬
the
provide for
we can
problems.
of
panded markets for
such
f
certain
know
people
ment date because of
offered.
what
by-laws. If it is
preferred stock, you may wish
to
the
.
Patience
of the war, increase their standard
of living, and
poration
a
v/hich exist to meet the needs of
the people.
conditions, and the second
to be exercised prior to the
pay¬
tective? features should
be' em¬
bodied in the certificate of incor¬
or
date
prior to
market
size up the situation from the
point of view of the investor to
You
exercised
commitment
you
analysis of the market by offering
apparently!;(not public advertising) the se¬
occurring
prior to the payment date (which
may be many days after the day
upon which you are committed to
responsibility*
mind, the fairest agreement to
not be
passed over both parties is one where the firm
You might find that the agrees it will be bound to
purchase
president has been convicted of
crime that the
corporation mistakenly believes it owns a certain
contain
certain J, calamities '
issue.
should
lightly.
of
offered
prepared for the last
operation of the origination func¬
fact
or
will
public. The first step
After such
are
:
therein
agreement
an
Negotiation-
was no
material
stated
the
reflects
v;:
corporation
purchase the trucks.
make
the
statements made in
registration statement / «'
ing
case,-the
.
care of the
(SEC) Staff in
processing registration statements
as
one
the
.management, the condition of its
physical properties, products man¬
of
it
of
Com¬
ticularly small business, in taking
advantage of the opportunities
1785)
page
The Department of
must, too, render all the
assistance within its power to aid
business in the United States, par¬
fundamental importance.
During
the war the people of this
country
showed ? their
ability to attain
lease with option to purchase
the factory and obtained an option
operation—In¬
position, its
•
better
absorbed?
tives.
f
Just one further thought on the
underwriting function of invest¬
be ter¬ ment banking. A well-drawn
by the insiders. As part of the
tightening up process prior to fi¬
nancing, the corporation that pro¬
posed new financing obtained a
are
is
letter
when
con¬
hired by another company owned
you
which
only
(Continued from
Departments;
merce
duction—more and balanced pro¬
duction—in all these lines is of
that
"examination into such facts
.-corporation's financial
-
might
or
cor¬
Production: Harriman
;
other
agencies of the government
to meet these fundamental
objec¬
capital
responsive to the SEC's
deficiencies.
new
But
■
improved?
acts?—Do the in¬
factory from a company
controlled by the insiders and de¬
livered all its products by trucks
vestigation—deserves more atten¬
tion. By Investigation I mean
that
.
changes made in that amendment
to the registration statement
leased its
deals from the
•
own
that
In
do.
locating
as
many "bird dogs" who
street.
in¬
the
Little time
this
on
their
Caffrey's
good rule of
"red herring"
a
a
the
price control reasons there are
separate entities performing acts
which the corporation itself,
might
in-
corporation
capital funds.
be spent
on
As
thumb, send out
Can
—
obtained
More and Balanced
you
prospectus
protect
be
recent address.
point
the
or
following operations: i
First—Discovery.:
or
,
period
the closed corporation seeks pub¬
lic money for the first time. You
will invariably find that for tax
writing, and thirdly Distribution.
:
per¬
a
provi¬
inquiry is particularly true when sion to the effect that in the event
Under¬
comes
and
example
will be accepted. On this
will
find
helpful Mr.
sugges¬
strengthen
Directors
minated
As you know, investment bankincludes three separate and
successive functions. The first is
Origination.
of
tracts
ing
#
are
of the
name
which
with
and
funds through your firm.
you
poration
wwv wy
siders have supply or service
of
Investment
Banking /.
•
*VIVWM
operate
mitted
Is it stacked with officers pass¬
ing
banking, it
might be helpful to note what is
involved. f
,
will
For
Board
dealers will continue in the
field
which
vestor.
im¬
portant phases from the long term
view, and with the thought that
some
Y
this investigation
opportunity to make
corporation
other
are
v*
O
during
banking business.
However, there
proud to hear the
re-
corporation and; its position
the industry, you have also
in
u
aspect
Banking
and apparently expected
during the pendancy of the state¬
cently granted, or that contracts ment (while it is in registration)
for primary raw materials will to circulate informative
data, in¬
not be renewed.
cluding
a
prospectus
properly
Besides learning the facts about marked to state
that no orders
might believe that the ability to
price an issue (an ability which a
rteaio*.
v.;*
dealer with his ——:
experience would
be expected to
have) is the most
.
strengthen the general corporate
organizationr so. that^ive years
after the financing you will be
securities ^although
a
tial wage increases have been
1829
curities. It is only after the effect¬
ive date that you may offer the
sharp reversal in
the trend of profits, that substan-
ness
ventures—that was in ? the
last quarter of the 19th
century.
With the recent
example of a
drop of 40 points in a new issue
of Preferred Stock after
the re-
moval
m
THE COMMERCIAL & FINANCIAL CHRONICLE
V'"*'/
:
;•
...
Member Federal Reserve System and Federal Deposit Insurance Corporation
-
.
-f.:v
1830
THE COMMERCIAL & FINANCIAL CHRONICLE
get
a*
larger
rate of return. . . . Likewise it is realized that profits
trading will be very small from now on, •if not eliminated
from bond
"
9?
Our Reporter on
almost
Governments
Thursday, October 10, 1946
:■
f
entirely,
ANOTHER IMPORTANT FACTOR
'
/f-..
Also the movement, of deposits is going to have an important
,
.
bearing on the* investment policies of the commercial banks. . . .
displaying a much Many of these institutions, in war centers that had expected a siz¬
improved tone, as prices moved out of recent trading ranges, due to able decrease in deposits, and made preparations to meet such con¬
the increased demand for issues, from practically all institutional in¬
ditions by the purchase of short-term securities, have come to realize
vestors.
Probably the most important factor in starting the up¬
now that these deposits are not likely to move to other centers, but
trend in prices was the demand for the longest bank eligible 2Yzs
and the newly eligible 2V4s, from out-of-town banks that needed will be a permanent part of the deposits of their institutions. , , .
income to offset rapidly increasing operating costs.
The psy¬ Under such conditions, with deposits likely to remain in the immedi¬
chology of fear and uncertainty that had gripped the market seems ate
locality, there is not the same need for short-term securities. , « .
to have been broken, at least temporarily, because the need for in¬
This will no doubt lead to a lengthening of maturities in order to
come among some of the smaller commercial banks became important
build up income, which has not been helped by the large holdings
enough to have resulted in their acquisition of obligations, principally
r
in the longer intermediates and longer-term maturities.
Com¬ of low income short-term securities.;
mercial banks with savings deposits were reported to have been
Reports are prevalent in the financial district that banks in
buyers of the longest maturities of the eligibles.
A good demand
certain of the Pacific Coast war centers have recently been buy¬
was also in evidence for the partially exempt obligations, which have
ers of the longest eligible bonds, with funds that previously had
been lagging behind the taxable issues, despite a more favorable
been invested in short-term issues, which werp being held as a
tax-free yield, than is available in comparable maturities of the
protection against deposit withdrawals. • •.
...,,
....
taxables.
^
=' /
~
By JOHN T. CHIPPENDALE, JR. I,
;
The government securities markets have been
,
.
.
.
„
.
.
,
,
.
.
few of the larger banks came into the
a
LONG-TERMS SEEN FAVORED
.
market recently and cleaned, up the remaining partially exempts
extent the savings banks.
.
.
♦
.
" >*
t
believed that there will be
in price as non-bank in¬
holdings at yields that not
>so long ago would have been considered very attractive.
These
institutions, principally the life insurance companies, according to
reports, were not only shifting holdings, but also putting new funds
into the market.... Partially exempt obligations as well as the longer
obligations went
up
.
.
There
.
the longest restricted 2%s and 2y4s.
It
r;
.
some
.
.
issue
of bonds,
year..;,
*
to have been used largely to purchase
were
which had been
expected
the
near
end
The statement of the
a new
securities
of the
i
Treasury financing.
The 2*/4%
,
tendency particularly among the smaller
maturities of these same 2s and; from the longer
very
.
large holdings by the deposit banks in the
quite
loss t>f premium by
a
the nearer-term maturities.
...
are
not expected to be too wide,
...
The large banks in
City and Chicago will most likely be jhe buyers of the
bonds; that will be -sold by the
smallei banks, because
makes
capacities.
Moreover, the
British
still have not all their laender set
up.
They
economic
have only one central
office, which is really
British-directed.
That is the Cen¬
previously been earmarked for
What the Treasury
new
will da the restof the year in connectioiC with
indicated
but also the proceeds from sales of shorter maturities are being put
into the recently eligible 214s.
The Wz% due 1950, according to
coming in the very-
reports,
-International Bank.V.,. .
It is not likely that the government will be- in $ie!$narket when the
securities of the World Bank are being offered, ti v
|
monkpry authorities still have
although some decision on
tion,
mind on this; situa¬
Nov. --l maturitieswill be .forth¬
an open
...
...
are
being sold and
the: proceeds
reinvested
in
the
long'
>
INCREASE IN
TRADING
V
EXPECTED
tfcefu%£^^
doubt will have an
ury
During the last month, how¬
the Germans in the UK zone
have been getting more authority.
ever,
; •
differences % in
"Admittedly,
viewpoint
to decartelization be¬
British and American
as
the
tween
authorities
are
so
but
aspects
deep
far
the
of
economic
are
con¬
the decartelization ideas
not affect'; production or ex¬
cerned,
do
ports.
"Among
*. ■>
•.
,
the Germans them¬
have different ideas as
selves you
to what should be done with
tion ideas
some
in¬
socializa-;
areas,
For
strong.
are
exam¬
ple, in Greater Hesse in the U. S.
constitution they
Zone, in their
have laid down such government
as
ownership of basic
industries, banking and insurance.
policies
similar trend in parts
a
It is very strong
in the Rhine and the Ruhr. It is
an
excuse for
creating in effect
lighter cartels than ever.
For ex¬
ample, all the coal trade in the
UK Zone is now subsidiary to the
North German Coal Control at E&-sen.
Yet we have been breaking ;,
up
will be the flotation of securities by the
long-
and
as
merger
of the UK Zone.
maturing obligations is still purely conjecture, because it is
are
tral Office for Economics at Miu-
There is
TREASURY'S MOVE?
that the
,
less far than the Americans
in this regard heretofore.
Until
quite recently the Germans in the
British Zone had only advisory
gone
shifting of paatwrities will.mean.a goodirading market, but dustry^ ? In
meeting a good reception from the
commercial banks, which institutions according to reports have been
taking on sizable amounts of this bond.
Not only new money
term 2s.
,
The British have
Administration.
term,
.
the nature of the business carried on by the large £ity banks
1 *
:
.
due 1956/59
a
these short-term issues attractive to4hem,.v.
Treasury Secretary that no new bond issue
no doubt was responsible for the use of
that had
/there is
shorter-term
'
is to be floated at this time
funds and
rate
income, it is expected that these institutions will move out
of the shorter maturities of 2s into the longer-term bonds,-before
New York
|lg|>
.
are
fluctuations
•
.
These holdings have been estimated to be in the neighborhood of t
$1 billions and
the
in
prove
This
of the short-term issues they had acquired.
changes
no
permanent, which should allow a lengthening of maturities to im¬
•
though non-bank investors have also decided to
seems as
out of
,
be v
shorter maturities of the 2s and with deposits likely to be
intermediate maturities of the taxable eligibles and the longest-term
bank issues were being sold and the proceeds put to work largely in
move
Germany
(Continued from page 1783)
zone can supply luxury and semiluxury goods desirable as exports
to raise foreign exchange for Ger¬
many's self-support.
V / .Ns
"The most difficult problem of
the bizonal merger is the degree
of responsibility of the German
den.
will
intermediate-term 2s into the 2%s and' 2Vzs.
real desire to build up
a
there
commercial banks to switch from the shorter maturities of the tax¬
able 2s in the longer
restricted
vestors showed
,
structure, unless there should be a drastic inflationary trend, it is
'
,
that
indications
With
NEW BUYING
/:
.
In
,
that had been seeking buyers. .., This resulted in prices moving
ahead despite selling by the insurance companies and to a lesser
■
|
"Marriage" of
.
,
It is indicated that
The
The
Britain and the U. S.
t
On this
^artels in our zone.
of' decartelization, there¬
fore, we. and the British at the
outset of the .merger have agreed
to disagree.
>
subj ect
'
Although it is not expected that there will be
acquire securities,
as
any
wild rush to
Also it is believed that the
in
is looked for, provided thbre are no drastic changes in economic con¬
ditions.
.
lieved in
.
.
Assuming that there will be
some
no
boom and bust, it is be
likely to be under the influences of shiftings
in holdings by the commercial banks.
.
.
financing operations if holders of the longer-term
.
quarters that the government securities markets for
about the next year are
-
~*r, >
,
<'g cg
they
are
One
,
in the larger city banks, must find
to offset these higher costs.
means
main
"The
aim
Observations
.
.
;
'
.
team was, of course,
-☆
1 We
,
have
broken up all Nazi organizations,
trade associations, and the
and permit voluntary asso¬
like,
ciations
only in an advisory ca¬
These associations have
part in the allocation of ma¬
pacity.
no
or
markets, as the cartels
British
"The
started to
necessitated by that
annoyin^inatter
invasion of their country.
%
'/
but
adopted
(Continued from page 1781)
view
of Hitler's
vtu
"A
to
our
second
reconcile
on
their
in
zone
the associations for
use
allocations,
ir
the merge*
Reich
•
...
of doing this is by extending maturities in order to
of
increased / output.
did,
to build up in¬
ways
.
'
is
terials
These institutions, particularly the smaller banks, are facing
increased operating expenses, and with loans not increasing, as
come
government will not be engaged
ineligible
issues should be seeking to dispose of these obligations in order
to obtain funds for business needs.
. Business conditions and
trends of prices also will have an important hearing on future
Treasury financing- policy. . . . Economic "conditions will be
watched very carefully and adverse developments will no doubt
bring abrupt changes in monetary policy.
in the past, a much more active trading market
they
now
on
problem
merger
the
planning.
different
already
As
have
this subject,
is
ideas
noted,
concept bandied about: the community the British have a tight planning
Hitler's pleas for "Living Room" system, whereas we favor plan¬
(Lebensraum) were laughed off and seen as an obvious excuse for ning by such major commodities
aggression. Yet Moscow's (despite her possession of "infinitely vaster as steel, nonferrous metals, chemi¬
territory) alleged need for inner, outer, and super-security belts, as cals. textiles, etc.
•
an alibi for grabbing and infiltrating throughout Europe and Asia, is
"At present we are far from
accepted as gospel by many of the same debunkers of Hitler.
On reaching the steel ceiling set in
Oct. 31, 1939, M. Molotov for the Soviet denounced Britain and France the
level-of-industry plan, and
as the "aggressors" for continuing to fight after the fall of Poland.
we
need coal.
The steel ceiling
This followed Russia's attack on and partitioning of Poland. Yet now
won't be reached in 1947, unfor¬
German war criminals are about to hang for;the .specific act of
tunately. I If, as Mr. Byrnes stated
aggression against Poland. So if Hitler had not ruptured the Berlin- at Stuttgart recently, the Saar is
Moscow Alliance, and the war had still ended in his defeat, M. Molo¬
written .off,
that part of Ger-»■
tov presumably also would now be awaiting the noose.
many's
steel
capacity
assigned
// '*
' * '£.:■>'
originally to the Saar will go \o
the combined area.
Misuse of the term liberal is probably the most#idely practiced
"Germany
is
just
beginning
of all our misnomering.
But the outburst in this , week's metro¬
politan "liberal" press against a political campaign ^committee which again to make strides in the pro¬
duction of steel."
deems to oppose the ClO-Political Action Committee electioneering
for its candidates, evidently marks the reinstitutioh of a special dis¬
In
connection
with
German
honest and cowardly, though effective, type of smeair%echnique. Thus,
ideas as to treatment of industry,
for writing a rather routine solicitation of funds for overcoming 'the
banking, etc., the official quoted
PAC purge," General Robert E. Wood is castigated-'by a New York
above observed that in the Rus¬
evening newspapers as "anti-liberal," an America Firster, antisian Zone of
Aggression is another
without much rhyme
.
SPECIALISTS IN—
United States Government
Securities
*
'
.
State and
i
.,s' ,\i
.
-
:•
"-'V.
Municipal Bonds
\
or reason.
•
C.J. DEVINE
&
CO.
INC.
48 Wall
Street, New York 5
HAnover 2-2727
Soviet, anti-UN, anti-British, anti-Roosevelt, andj^nti-Semitic.
these unsavory people are represented as composing the part of
All
the
community which is nefariously plotting to overthrow "liberalism,"
liberty and democracy. The glaring logical error being in presuming
to arrogate to labor and the Left-Wing, a monopoly in the practice
of true liberalism.
Germany
the
old
banks had been replaced
with
new
State
can
about
,•
three
Chicago
•
Boston
•
Philadelphia
•
Pittsburgh
•
Cleveland
Our democratic system can,
Cincinnati
•
St. Louis
•
San Francisco
and does, weather a great deal of
It must be realized that one
But its resilience is not limitless.
of the
☆-
abuse.
very
tional
and
weapons!
greatest threats
endangering it is the' demagogic, emo¬
rationalizing misuse of language.
.'V-
Words are dangerous
In the Ameri¬
institutions.
Zone not much has been done
banking.
laender
of the former
banking
In
are
of
the
remnants
private and central
systems.
laender has
each
the
Each
expressed
a
of
the-
desire to
have its own central bank.
Volume 164..
Number 4532
THE COMMERCIAL &
FINANCIAL CHRONICLE
his
(Continued from first
page)
nails
in
"the
Palace"
cluding r
jail,
where
justice
was
meted
out.
Some here who have
gone through
the hell of
concentration camps
are
already predicting that "it
will
be
a
political
rather thari
a
judgment,
judicial one."
When the wives and
families of
ihany of the accused came from
their last
small
meetings at the jail,
crowd
'gathered
them enter a school
their
lunch. A
to
a
watch
building for
They • were "wellthese
Nazi
wives
and
children. They looked
very harm¬
less.
Frau
Goering - and • her
daughter;.- Frau
Doenitz;
Frau
dressed,
•
Seyss-InquarU There seemed, in
the
bright
autumn
connection
sunshine,
no
between the soft fur
by Frau von Schirach
cape worn
and the
photographs of the skinipid-bone corpses before the cre¬
matorium
though
bead
of
he
knew
testified
the
Reichsbank,
nothing about
the gold teeth fhe SS
banked with
that institution.
Most
not
so
turned
in
rection.
I
chill..... of
penetrating
the-nights
mornings
young
the
these
.women
and
days
early
one
outdoors
sees
dressed
only in cheap housedresses.
And
many of the men still wear the
.Bavarian leather
shorts, doubtless
saving their longer trousers for
the winter ahead.
The women are
•
mostly
legged, the people here
bare*
indiffer¬
or
poorly shod and clothed,
many here, as elsewhere
through¬
out
Germany, pulling carts and
otherwise acting as beasts of bur¬
den.
Germany now is ?again, a
have-not nation.
People
•'are very
busy, just, keeping alive. It will
be a long and hard road to
anyfiling resembling normalcy here.*
y Yet work is
beginning—peace
time work. The rubble
is
saw
which,
mechanical motor boat
a
when
started
on
seemingly
are
hopeless
f
it reaches
the floor.
on
When
the
saw
starts
do
mechanical auto which
a
Fac
went
circumstances
as
through
a
It
simply
of one's breath
pressure
icate
works
mechanism.
garage .'with
outside
I
on
plant the
other day.
Before the
this plant made 6,000 to
10,000
autos
a
day.
(Detroit papers
please copy.) I went through the
"assembly line." I saw the auto
bodies being stamped, the skilled
workmen? putting the
parts to¬
gether, the paint shop where the
qars were being
sprayed with gay
prewar colors.
One
calls
at
enters
command
a
the
en
was hot a
factory to fright
Detroit, however.
It
was
one
or
have
we
has
its
into
the
open,
no
home
of
He
lives
at
part which was not
burned. The plant had
during the
ous
a
almost
entirely residential,
an
ical
another
mechanical
kinds
which
work
with
real
"cruise,"
'and
.
other
marvels devised In this
of the pocket
three-fourths
of
went
abroad;
went
to
and of that,
United States.
the
our
output of toys
half
The
lilliputian anti-German boycott hit us
birthplace hard, before World War II.
timepiece.
•
' *;
main*iiroblem^perhaps,
■
very
Our
is mate¬
rials.
For a -toy; the cost of the
to y Mr: r Alexander
Girz, manager - of ? the Schreyer material is only a small part. On
out toys, such as boats and
plant, old customers from preelec¬
boycott days are again evidencing tric trains, etc., there is a great
According
interest in "Schucb" toys.
After "the boycott had decimated
deal of hand work.
In the United
Statesystxcft* work is Very costly.
firm's toy business, Schreyer Sor even when the boycott was on
became a war plant, making tele¬ one of your big New York
depart¬
phone equipment. Now it is oper¬ ment stores still bought some of
the
ating at one-fourth capacity, mak¬
ing household hardware for re¬
construction and toys on a smal
scale. In one year the firm hopes
to reach its prewar toy
capacity
But that depends on many things
we
saved all
We
sons,
now
tools.
our
y
,•
employ about 120
per¬
compared with 250-300
the boycott.
During the
as
Now
that
the
Nuernberg
A
girl
arettes
who
gets
worth
the
even
Allied
jurists
"further
against
ness
will
take
industrialists
Krupp empire or I. G. Farben is
decided.
70
a
pack
marks
"Patents
a
week.
are
also
a
a
wage
^
-
a
v
problem.
Our patents registered abroad
are
vested by the Allies. Even
now
we
so,
feel that
we can
compete with
American manufacturers when it
comes
Lawrence
cig¬
from
soldier isn't attracted by
of 25 marks
get.
of
to
price, g We have new
ideas, as well, but for the present
these blueprints
merely remain
locked up in the safe.
Nobody
Printing Co.
Joseph D. Herbst, after
in
association
the
many
again
may
pay
her
But
revival
own
way
of
this
surmount
[t
many
to learn
was
hese
to
commence
in
the
world
trade
must
munity, has joined the Lawrence
Printing Company, Inc., 80 Green¬
Street, New York City, and
will
specialize
Printing.
■
in
Wall
was
assistant treas¬
urer of
Braham, McElroy & Co.,
Inc., in the Trading Department of
J.
L. Schiffman &
Co., and the
Cashier's Department of Hirsch &
•
here knows what he
new
can
do with
patents.
,3
He
land
participated in the Rhineand
paigns
Confiscatory Taxation
"Taxes take today 90% of our
earnings, just as if we had suf¬
fered no war damage, no bad
debts for munitions delivered to
the German government
during
the war, etc.
One Of our com
ships, because they could not petitors tells me he is actually
paying in taxes of all kinds 114%
get them* elsewhere.
of.his company's earnings."
"Our materials problem
today
Central
as
Infantry
service
Europe
member
a
Division
of
and
with
the
29th
and
the
78th
Division
Division.
is
But the Germans have the knowhow for this business.
They can
fore the
war
in
York
sell
These
Nuernberg toys are no
ordinary playthings, by the way
They represent a great amount of
technical - skill.
Raw
materials
represent only a small fraction of
the cost of the finished
product. I
saw in this
plant, for
example,
small
ential
!An
racing auto with
gears
house gate
from
and
four
anachronism
was a
Berne,
travellers.
How
a
shifts,
New
that the landed
the
in¬
court¬
filled
healthy-looking
Such
a
busload
passing marvel.
saw
InfantryInfantry
Marshall Barlow VP of
RobL E. Schweser Co.
i OMAHA, NEB.
Marshall J.
Barlow, formerly in the municipal
bond
business
in
Des
Moines,
Iowa, has been elected as Vice—
President of
Robert
Company and will
the
E.
Schweser
be in charge of
Municipal Buying Department.
Barlow was formerly an
Mr.
officer of Carleton D. Beh Co. of
Des Moines. His association with
cos
Potential Competition
the Schweser
Company was pre¬
export price.
Such a boa1;
Some British typewriter manu¬
viously reported in the "Chron¬
car for two orthree marks whole¬ used to, sell at retail jn New York
facturers who were in Germany icle" of
September 26th.:,
y
sale.
That would be 20 or 30 for about fiye dollars.
sdme time ago, I am told, ex¬
American cents f.o.b., at the mil¬
"We have arranged the sale o: pressed concern at the
prospect of
W. H. Bell & Co. Adds
itary rate of exchange. But there some toy boats, steam engines and German competition.
They cal¬
racing
about
was
double
trains to the United States
Army culated that the Germans at the Four to NY Sales Staff
Exchange Service
for
sale
in military rate of exchange for the
W. H. Bell & Co.
Incorporated,
im¬ Army PXs. Goods for export di¬ mark could make a typewriter to 50
Broadway, New York City, an¬
sell in England for one
portant thing for us in Germany rect, we sell to OMGUS in Berlin.
pound nounces
that
Arthur
J.
Costy,
is to be able to import raw ma¬ There is at present no other way sterling,
as
compared
with
a
Clinton W. Frasier, Fred G. Kuhlto handle it, We
terials. We need freedom to trade
British
need, of course, comparable
typewriter man and Eli Urdang have joined
a dollar rate of
with other countries, we need
exchange. If we selling at seven pounds.
Some the firm's sales
of
exchange,
and
ex¬
need
we
of
the mark, both
internally and externally. Finally
we
need
economic unification
of
"Before
the
bought
war,
our
for example
zinc
in
Eastern
Germany.
Today, so far as
know, Germany gets no zinc from
any
.
tomers, with whom
we have had
contact for about 10 years. Our
customers should be able to send
no
Germany.
we
source.
We
need
in
buyers to Germany,
There is a
our toys in the Amer¬
market for
ican department
order houses.
We
need
wool
for
our
.
and
mail
War Damage
"When
lost
we
the
matters
are
market
through
the
had
dancing dolls and animals.
these
stores
toy
our
business some Swedish steel. We
need raw materials from Czecho¬
"Until
organization.
to do business with the United
States again, we must once more
find a way to contact our old cus¬
are
turn
other
to
During the
to
war
we
"THIRD" in
N»».
American
boycott
we
activities.
were
a
war
Banking Service
in
in
Service
WashingtonpB^ G,
The
Riggs National Bank
welcomes the opportunity
to
serve
Bankers, their clients and friends
in the
W:
J
THIRD
NAH0NAL BANK
-
TttuAville
TENNESSEE
t Nation's Capital
Resources
over
$300,000,000
Tennessee's
large tourist bus
Switzerland,
tvith well-dressed
got here is
at
a
real differ¬
69th.
also
our
the, above-mentioned
something abou
as
they seem to
Toy Manufacturing Renewed
Cam¬
the
our
called
•
Street
"
Mr. Herbst
the
I
com-:
wich
toughs problems
problems
German manufacturer that
on
Schreyer & Co., makers
of "Schuco" toys.
long
a
financial
Military
that Ger¬
case
not yet
Government in Berlin to produce
so
busi¬
and
Whether the first
men.
the
those
to get to trial will be that of the
.
something for export
up
proceedings,"
non-
hard .to
are
mostly that of brass and tinAccording to one of the toy
plate. We can make a 'steamer' manufacturers here, the British
like this one, which is 25 centi¬ Military Government will not con¬
meters long, or about a foot and a sent to
"We
have
no
peace
supplying from its zone of
yet,
you
know," Mr. Girz sadly remarked half, for about seven marks today Germany an essential metal prod¬
"What happens in this business or only slightly more than before uct needed in its business.—"terndoesn't depend upon us." Raw the war. That is. the f.o.b. whole
perguss"—if the metal is to be
sale price. We used to
materials are extremely scarce
figure be¬ used to manufacture for export.
of
Nuernberg's I toy > factories,
working with the encouragement
of the American Office of
ver¬
dicts have been handed down the
war we had as
many as 320. One
of our chief lacks
today is skilled
buildings of the workers.
And
in
Nuernberg skilled workers
part of the city which the
uninitiated visitor might
regard
as
the future.
fire-fighting organiza¬
Fleischmann
in
are
pumps and
before
war,
toys which are practically
toy factory here' I working models of modern ma¬
boats, toy steam chines.
"Before the
war," Mr.
rollers and steam engines of vari¬ Fleischmann
told
me,
"about
In
are wondering whether
Germany is to be the "Japan" of
our
tion, this plant would have been
destroyed
entirely.
While
the
his machines were heavily damaged,
toy car apartment - house ^ neighborhood.
itself and Yet here are turned out mechan-r
the-doors shut.
saw
About 60% of
was
about
blitz.
factory
the
by
garage
The
toy Gbr.
a
on
phone, the garage doors
then
slovakia.
Contrast With Detroit
This
Girz
several fires
del¬
a
saw
had 500
we
the Residential District Industrialized
by
telephone
a
wall.
Nuernberg stabilization
war
Mr.
and stops whenever told to
so.
oy
Now
own, since the
;he plant in a
edge of the table,
it simply stops dead.
bombed
I
war
50."
top will go right to the edge but
refuses to fall
rate
I
^
ruins.
starting to manufacture
permitted goods,
I permit.
workers.
table
a
slowly is no commercial rate of
being ; cleared away.
Here and change.
there, bricklayers m
be seen at
Said Mr. Girz: "The most
their
tasks, even in the midst of
tories
Before the
ness.
people in Nuernberg are
their
well attired as. these
fam-
Even In
;
ently
be
machine guns.
factory
damaged during the
steering straightened out, we cannot look war. Had it not been for our own
any di¬ for a full revival of our
water
tanks
in
the' yard,
toy busi¬
our
The
reverse.
can
of
between-the gaping jaws of the
tortured and the,spotless attire
of
Jjfrau Funk, whose husband, al-
.iJieBv
wheel
Mauthausen, which steam, a toy submarine which will
just seen; no
relationship submerge seven times in a single
:! had
■
plant, making cartridge belts for Britishers
Nuernberg Today
1
1831!
Founded 1836
Member Federal Deposit Insurance
Corporation
;
Largest Bank Under One Roof
MEMBER FEDERAL DEPOSIT INSURANCE CORPORATION
T
THE COMMERCIAL & FINANCIAL CHRONICLE
1832
thermore
Dominion's
the
newly
developed industries have to rely
to a large degrees on. iheamPlirt
from this" country
of necessary
The Stock Break—
component
parts. • Consequently
highly vulnerable to ex¬
ternal influences especially those
vr
rifflWhy? What Next?
'
i*r'
Canada is
By
1
' i.'
,
'■>
''
WILLIAM McKAY
'-''vV .'v/
ii '•
_•
Thursday, October 10, 1946
irij.
.-Vti
■'
.«r-/;'
i ■(
•'
i.':':
emanating from her colossal neigh¬
Tampering with the rate of exchange has never provided a sane
solution to economic problems. When an overvalued exchange level
bor to the South.
####;## #;
'
.
(Continued from page 1784)
six weeks—the
away
is subject to
Exchange manipulation and the
erection
of
insulating
barriers
ger
not only master
therefore
provide only a tempo¬
for
external pressure resistance is both difficult and costly.
When, however, a currency is undervalued, a competent control can
the resultant outside pressure but can also turn it
to good account.■ "VA
'. V ## .# '#.# #' ##' '■'##:###'" ;##:# #■./.,## #'"!## #
The recent abrupt step "which#1
longer you stayed
from your business the big¬
the
ballocn
became.
the
We
of
personal
became
"touch"
or
employment rather than maintain
sixty millions at jobs.
,: . '
>\
ego
"sock." v
to
How Long Will It Take
vulnerable
.Readjust? ' ■-
V
This
a
\
.
In order to correct has never been a business of
How long will this take and .
easy
of balance and
money and never will be.
Easy last? I feel that it will all take
led to the upward revaluation of the Canadian dollar was appar¬ to build up a greater measure of
hold
money is unhealthy and non-ap¬
quickly as to ,the adjust¬
ently taken in desperate defense economic independence Canadian preciated earnings. The hundred- ments
by industry and that the
against ; mounting
inflationary long range policy will have to en¬ penny dollar will .always have to
period will be fairly, brief, pos¬
dangers outside the Dominion. In visage a definite immigration pol¬ be earned.
Yes, I guess we had sibly six to nine months. The ear¬
spite of previously announced in¬ icy and the means whereby Ca¬ it coming to us.
lier the necessary action is taken
# ;
$100,000
;; tentions to preserve the 90 cent nadian industry can function in¬
the sooner the upturn. But if ad¬
dollar
on
which
foundation
a
tegrally.- Then only can Canada
Postwar Prosperity Vulnerable
justments are necessary and in¬
realize her high destiny and thus
stable -Canadian
economy
had
I have felt right along that we dustry delays too long, the cost
been laboriously built, a 10% de¬ permit a fuller development of
had skipped over the period of will be greater and the upturn
fense
was
hastily employed to her unrivalled resources to the
adjustment > between .War
and delayed through the lack of work¬
:
counter a 100% - menace. ' Basic universal benefit.# Peace too blithely and quickly. A ing capital depleted by carrying a
During the past week the se¬
export industries were suddenly
:■>
world-wide abortion of the nature costly problem too long.,
##;
deprived of an existing advantage curity markets continued their of
World War II has vast and farI believe that we can use as a
2 %% Sinking Fund
and were recompensed either by sluggish course.
}
There was still
reaching social and economic con¬ measurement the business indices
internal subsidy or by price in¬ no interest displayed in external
.•u,|
Debentures .;##;#?#
sequences
that cannot # be : dis¬ and the Dow averages. This yard¬
creases
which
only serve still bonds but internals still met a missed.
lightly by blind-optimism. stick I have mentioned above is
further to add to the external in¬ good demand. Purchases of inter¬
It appears to me that this period my own thought, and is not the
Due June 15, 1961
flationary forces pressing on the nal bonds however were offset by
of
"prosperity," so quickly en¬ product of charts or advisers. This
sales of stocks. The settlement of
Canadian internal stability. |
tered upon, was all on blue-prints. is one time I hope I am wrong.
the steel strike which should fore¬
Hitherto
the
fabric
of# the
Principal and Interest Payable
Facts must be faced no matte*
the termination of 'the Sixty million were employed and
Canadian economy has been cau¬ shadow
t
in Lawful Money of the
production was increasing.
But I how unpleasant.
tiously constructed from within stoppages in other industries, was
personally didn't see the results of
United States
and by dint of able management not a sufficiently powerful factor
Prewar and Postwar
it. Did you?
and careful control it has been to strengthen the Canadian stock
Looking back, I feel that we
Take
a
typical example
a
largely insulated from undue ex¬ markets in face of the continued
were pulling out of the depression
Price 99 y2 and accrued
i
manufacturer.
The
small-parts
#
ternal influence. This policy suc¬ weakness here. *
in 1942, the last year of normal
While the Canadian dollar in manufacturer of radio condensers,
ceeded to the point that the Do¬
interest ;#########
effect bf
with prewar sales of a few thou¬ business, - without the
minion, in an economicaly trou¬ the unofficial market remains at
war
work and its results.
I be¬
gets inflated
ideas.
The
bled world, stood out as an oasis a sizable discount, internal bonds sand
lieve the trend at that time was
of stability.- Reluctant as Canada are still attractive for investment Army and Navy "E" flies from his
Prospectus on request
slowly upward. The low point in
was
to maintain rigid exchange purposes. Thus the manipulation factory flagstaff—and rightly so.
He earned it then.
But he now the averages then was approxi¬
restrictions, the favorable results of the official rate has done little
mately 92. I believe that without
achieved with a minimum of det¬ to check the#external drain on wishes to remain in the millionthe war that progress would have
Direct Private Wires to Buffalo,
internal
securities,
but if free dollar sales bracket which ab¬
solution.
rary
the
existing lack
Gatineau Power
Company
,
.
,
.
riment
Toronto and Montreal
to
foreign interest proved
been made. It is also a fact that
funds were brought in line with normal war work made possible
policy. " ■ ' .
for
him.
His
blueprints read: progress and wealth have been ^
Today the prospects for imme¬ the official rate then no doubt the
Manufacture all the condensers, made through the results of the
diate universal relaxation of con¬ outflow would be stemmed. /, •:
not alone the best.
Enter into a war which can be applied to cor- !;
trols appear increasingly remote.
complete program of the finished porations' net value in dollars,
Consequently the Canadian fears
1,
radio and 'compete directly with knowledge and equipment. ^; 1
of a sudden overwhelming infla¬
I believe that over this sam6
his own customers.
Include the
tionary wave; from south of the
the wisdom of this
.Dominion Securities
(corporation
New York
border
40Exchange Place, New York 5, N. Y.
Boll System
Teletype NY 1-702-3
i
the
could
have
been met by
erection of still
Such a course of
temporary
Greater
than
the
of
accelerated
lative
an
buying
PROVINCIAL
risk
of
Ca¬
was
securities,
tremendous
a
specu¬
of
the
outflow
of
could
tions
have
been
placed
on
have been imposed
undue
an
nadian
to pre¬
of Ca¬
outflow
commodities.
##
As it is
likely to transpire, the
inflationary wave in this country
has
probably reached its f peak
and safeguards taken in the mean¬
time
CANADIAN STOCKS
will
only
probably be
necessary
temporary
should
from
INCORPORATED
;
NEW YORK 5, N. Y.
not
'
be
considered
only
the
of
bolstering
the
NY-1-1043
Canada has
lation
achieved
but it is
a
prodig¬
Non-Callable
64
Wall
'#■■
'.
consumption. Fur¬
't# #:;#
# v.-:-
The
Allen
MacDuffie, whose speech is
printed elsewhere in this week's
issue of the Chronicle.
E.
Clarence
#
-
of 60.
erage
a
I.
Pitou,
retired
New
Mr. Pitou joined the brok¬
firm of Walker Brothers as
He became
young man.
ner
20 years ago,
years
part¬
a
and retired three
'
ago.
#
V-
•.
SECURITIES
''?##;
'
/'
■'
'"'#•••
payable
semi-annually
to
in
the
Dow
averages. #
have
I
All
swer
reminds
this
I
once
into business.
me
of
an
an¬
overvalued
(reached
of 212
level
One hundred and
fellow going May 1946).
On replying to his fifty-two is the point at which I
believe
that
we
shall see! this
gave
a
question, I recommended that he
market "go," and which will be
so providing he had two bank¬
for making mistakes. the end of the bear-market.; Ex¬
That's the principal weakness of a aggeration will again possibly see
it a little lower and prolonged
lot
of
corporations today; new
ventures« without
the
required beyond its true time, but gener¬
it .
>!
knowledge and capital to com¬ ally 152 is a focal point.
do
rolls—one
That's
am
wrong.
the
looking
takeoff point that I
forward
to.
Unless
in major events take hold to change
my opinion, one way or another,
many industries and corporations,
I am not making permanent in¬
I believe that adjustments have to
With
this obvious
weakness
vestments now nor will I be de¬
place. That the majority of
ferred in starting to make them
companies of small business and
around that point.
The years of
sales of prewar times will have to
real bull markets and business that
take their licking, swallow their
will come would dictate such a
pride, and set back to their nor¬
course.
*•
*
.•
' #j
mal and true position in industry.
Such a reversion, I believe, will
create various conditions: Princi¬
pally, there will be a sudden
cleaning out of inventories, par¬
those
ticularly
nature.
of an
unfinished
Inventories in the hands
present amount to
$18,300,000,000 and this could prove
to be a major item in earnings
and production.
But, to my rea¬
soning, the situation is top-heavy
and I believe, though I am not
certain, that this is made up in
large part of unfinished articles
undated as to the completion pos¬
of industry at
I
know,
as
you
do, a cleaning
inventory will result in
Harrison
#
Hopper
With Doha & Torrey
I
# ST. PETERSBURG, FLA.—Har¬
rison
Hopper
has
become
asso¬
ciated with Cohu & Torrey, mem¬
bers of the New York
Stock Ex-
in
United
yield 3.79%
States
Funds
#•#•#•##.^
fice, Florida National Bank Build¬
ing.
Mr. Hopper was formerly
with the New York City office of
John
Nuveen &
Co. and prior
thereto was Manager of the trad¬
ing department for D. E. Arries &
Co. of Tampa.
'
v
.
Lower assets equal
lower
values: Lower production
means
lower earnings and scant
dividends. These truths are yard¬
sticks in our business and cannot
be ignored.
BOSTON, MASS.—B. G. Canto*
I feel that it could be that we & Co. announces that Donald F,, j
will return to the period that was
Thayer is associated with the firm
foreseen
and .anticipated. at >the
as Manager of the Boston office,
end ot the war, but skipped over.
I feel that we will yet witness un- 161 Devonshire Street.
;
Donald Thayer With
.
Wood, Gundy & Co.
,•-##-„
•
Toronto
14 Wall Street^ New York 5
Montreal
Winnipeg
Vancouver
London, England
j
change, in their St. Petersburg of¬
major losses.
Incorporated
It's the
of the Americans—"Hit first picked the averages to be main- ^
and reason later!" It pays off when tained at around
152, based on~!
it clicks.
But you really have to half the distance between the un¬
dervalued level
of 92
and the
have it to come out a winner.
way
out of this
Municipal
Corporate '
tempting to manufacture.
_
Maurice I. Pitou Dead
Maurice
period, if we were at
Cantor in Boston
,
'
E.
Association, presided at the meet-
four-year
take
C.
Unterberg,
Unterberg & Co., president of the
ing.
lines:
pensate for mistakes if things go
principal guest speaker was
4% Perpetual Debenture Stock
CANADIAN
Provincial
the
of
also discussed
3-1874
Price
\
member
a
other
several
irons, heaters, fans, toasters. Many peace, that a 50% improvement
of these products he knew little would naturally have taken place
about and had no business
at¬ in business—or approximately 138
sibilities.
Street, New York 5
Government
Co.,
Canadian Pacific Railway Company
Interest
l
&
the subject.
■/-###•' ' #'<.■:
J-
COMPANY
WHitehall
mons
Board of Governors,
unduly dependent
foreign markets in view of the
small domestic
&
regarding corpora¬
security holders and
York stock broker died at the age
parison with the size of its popu¬
on
TAYLOR, DEALE
made
cently
tions with 300
economy
from within.
ious volume of production in com¬
RECTOR 2-7231
proposals of the Securi¬
ties and Exchange Commission re¬
cussed the
point of view
angle of countering
movements emanating from with¬
out.
On the contrary the line of
approach should be in the direc¬
tion
TWO WALL STREET
Committee of the Association dis¬
measure.
a
as
From the Canadian
however the problem of the pro¬
tection of the domestic economy
A. E. AMES & CO.
Dunne,- Dunne & Co.,
Relations
chairman of the Public
security movements,' in a similar $3,000,000 in assets. ••##
Philip L. Carret, Carret, Gam¬
way
additional export
controls
vent
CORPORATION
Frank
of
addition
The New York Security
embarrassing
goods at uneconomic prices. Just
as
additional temporary restric¬
could
MUNICIPAL
>
movement
nadian internal
GOVERNMENT *"
Dealers Ass'n Dinner
Dealers
higher barriers.
Association held a dinner at the
action would have met little crit¬
Waldorf Astoria Hotel on Oct. 8,
icism as the apparent immediate
following a closed meeting of the
danger was monetarily very real.
membership.
pressure,
CANADIAN BONDS
Security
.
.
_
!
Vi'-x
.f
%.«•
-3
■s-xowrw;:
■■/'
'
>
1
,£1
i-or-'1
tj»*
J
r-
.'
•—.«•*»"'
»—
- t»" •
'**..<
1
iWrw--!*1
-—• -r- ~.vm
THE COMMERCIAL & FINANCIAL CHRONICLE
Number 4532
(VoTUme 164
;Y
1833
If*
Atomic Control Plan
v.
•'
which
is ' today's
"My country is ready to make
(Continued- from-page4785>- ^ sovereignty
its full contribution toward the
the dead.
That is phrase for yesterday's isolation."
Y our business."
On the question of principles, it end we seek, subject of course to
:7yY;Y'
Y;Y
Y Y' America asks nothing she is not is an inalieable right each of us our constitutional processes and
has to express opinion on every to an adequate system of control
•willing to give. All of us must
policy
animating
this
country, becoming fully effective, as we
make contributions.
y Y v.
Y whether
national or international. finally work it, out." By "we," I
;;
But I would be recreant to my
That is the highest,;function of mean all participating nations, v
trust if I dared to recommend the
Let
those who live under a political
me
announce
again this
\
immediate abandonment of a ma¬
democracy; of those who cherish thought in our program:
YyY?f--.
jor weapon in our arsenal—the
the right of free speech.
Every
In the elimination of war lies
;; bomb:5 How can any one ask de¬
man has the right to an opinion,
our final
solution, for only then
struction of existing bombs un¬
but no man has a right to be will
nations
cease
to
compete
less their further manufacture is
wrong. Nor, above all, to persist with. one another in the
produc¬
effectively "p'rohibited? Why in errors as to facts.
the quick and
,
f.
Securities Salesman's Corner
,
i"
»>,,
;*•
By JOHN DUTTON
A
Y
fault
common
of many
salesmen is that they tend to avoid
customers, especially when things are going a bit rough and
losses are taking the place of profits. This is one time when
that popular new tune,
"Doing What Comes Naturally" may be the
their
paper
course
that your emotions
is not the correct
customers
and
policy for
HOLD
.
should America alone be asked to
make sacrifices
by
way
of unilat¬
disarmament in the
eral
of
cause
international good will? If
equality
of sacrifice be needed, then each
should participate. ■ • ;
submit the
design to the Commission
which acts for all of the fifty-one
my
lot
now
in
was
to
efforts.
not
working,
countries
tions.
It
the United
Na¬
which
sent
of'dread
use
"secret"
evaluated j
are
solely by
their capacity to kill. That devil¬
strikingly well re¬ ish program takes us back not
in a few isolated merely to the Dark Ages but from
I firmly, believe that the Amer¬
Instances. But, as we know, there CGsmos to. chaos. If we succeed in
ican proposals plead the cause and is a difference between a
creator
finding a suitable way to control
contain a rough approach to the
and a critic. ' Each is important. atomic
weapons, it is reasonable
abolition not only of one instru¬ The first
job is the harder one. to hope that we
may i also pre¬
ment of war but of war itself.
A
distinguished writer said: in clude the use of other weapons
I now say that America stands paraphrase: he who can, does; he
adaptable Y to mass destruction.
ready to proscribe and destroy the who can't, criticizes. ,<w '.
When a man learns to say "A," he
!r
atom
lift
bomb—to
death
life—if
to
its
use
from
world will
the
pact to ensure the
world's security from atomic war¬
fare. But it must be a realistic
join
in
a
working pact—not merely a pious
expression of intent, wholly lack¬
ing in methods of enforcement.
The Soviet's Protest
>
"
Our
on
proposals
June
came
14.
submitted
were
Some
weeks
later
ceived
y
of
Ambassador
and
sure
and
for
ternational
ac¬
absolute
na¬
tional; sovereignty, but nations en¬
ter into such treaties of their own
free will and to their
common
ad¬
vantage. Indeed, freedom to enter
Into such voluntary international
arrangements is inherent in the
very concept of national sover¬
Y.
the
Yd. Provision for the interna¬
out effectively
ventive operations.
political feasibility.
It
is
understand
creating
important- to
the
methods
of
atomic energy for peace purposes
and for war use are the same up
need for inspection and control?
«
I say to you with all the weight
of my experience that the Ameri¬
plan does not impair any
country's national dignity or na¬
tional security. It is a great for¬
can
ward motion toward international
Where there
be found,
peace.
way can
is
a
will,
a
~
World Not Afraid of
*
Internationalism
The peoples of the world—as I
June—"are not afraid of
$aid in
2.
•
We look for escape outlets when problems pre¬
solution. There
that cannot, be
solved if
are
few difficulties which
think them
we
work.
out,, find
face in life
we
plan and go to
a
,
In this connection there Is only one thing that will solve your
present problem, if it happens to be one of temporary discouragement
.,v,vv.
that has been caused
by the current unsettled economic and market
conditions.
TO REPLACE INACTION WITH ACTION.
THAT IS
K
have been sitting around the office—passing time in wondering
what you. should do next, and incidentally worrying a bit about the
future.Y GO OUT AND SEE YOUR CUSTOMERS AND GO TO
you
WORK. Just as soon as you begin constructive thinking and get busy
working out possible trades, suggesting tax purchases and sales, or re¬
We are eager to follow this placing weaker situations with those that are in a stronger position;
code. We pursue a policy of en¬ you will find that your own pessimism will vanish.
7 YOU CAN ONLY HAVE ONE THOUGHT IN YOUR MIND AT
lightened selfishness. But when,
A TIME.
If you are busy working along positive, constructive lines,,
going to have mental health. A busy man hasn't time for de¬
mation, America wants to—and structive thinking. There is a therapeutic value that can be derived
from positive activity—that is another reason why work is good for
will—take a leading part.
at
long last,
peace comes, it will
to all. And in that consum¬
come
Now in the evening of my life,
faith in this coun¬
its
pre-
happiness, which
terment
of
and
the bet¬
of
Some
you are
all of us.,
It
\
*
worthwhile
seems
to
mention, however, that periods of al¬
THING
TO
DO
IS
KNOW
YOURSELF
AND
MASTER
are
growing.
sible set of principles that you* can find anywhere.
our
qualities have been slow to
ma¬
I
am
proud of our virtues and certain
that our faults are under correc¬
tion.
Sow Carolinians Visit NYSE
other way to widen
horizons than by the pres-r
no
of
free
initiative,
Williams, Governor
BUFFALO, N. Y.—The George
of South
Carolina, accompanied F. Jones Co., Inc., has been formed
with offices at 505 Delaware Ave¬
by J. S. Williamson, Chief High¬
but
Commissioner
of the State,
Burke, Secretary-Treas¬
urer of the State Highway Com¬
mission, visited: the New York
Stock; Exchange onr Oct. 8 and
and O. P.
;
.
must I go
it
resp onsibility
for the preservation
of full
b.
,
Illegal possession, or separation
of,
atomic
material
suitable
for
use
in
atomic
an
I.',.-.
-.
of any
plant or
property belonging to or
by the international
control authority. , '
other
licensed
d.
the
Willful
interference
activities
tional control
of
these rights than by democ¬
serve
racy—an
ever-deepening,
widening
democracy—a
with
engage
in
the
Officers of the
George
are
ever-
democ¬
democracy that gives
as a poet
phrased it:
"Ancient rights unnoticed,
us,
Dalrymple, Assistant Treasurer,
or
3. Transition
to
full interna¬
tional control by successive stages
to be specifically set forth in the
and
Four With
'],
y
visitors
of
to
the
Exchange.
They
which
has
no
.nation
accepted the interna¬
tional control
treaty
can
the
New
York
and
tion of its terms
through
state
or
by
any
trading
floor,
the
Exchanges, have added to
their staff Arthur H. Goodwin,
Jr., Paul D. Meehan, Charles L„
Munroe and Thomas G. Murtha.
Hytron Radio & Electronics Corp.
Stifel, Nicolaus Adds
Three in
(Special
to
CHICAGO,
Leinss,
Common Stock
Chicago
The
Financial
ILL.
Joseph
—
A.
> 'Yv
Chronicle)
.•
YX''
'
f
-VT' l,'r/V ',v
Prospectus
Edward A.
Nolan,
on
'«• ti'f
,
i
V-"1' '
•
'
\t / •••,
v
request
and
Herrick,Waddell
&
Co., Inc.
55 LIBERTY STREET, NEW YORK 5, N. Y.
forces
was
an
officer of Fred
American Fruit
E.
use
of
a
by the violating
other nation.
U.
S.
Makes
avoid
Busbey & Company.
Fullerton
Harvey B. Graven, Jr.
With ierriek, Waddell
misunderstanding,
our
Craven, Jr., has become associated
I
original declara¬
with
Oil Co., Com.
Members Los Angeles Stock Exchange
€26
Y
Y
SO. SPRING ST.
TRINITY 5761
IOS ANGELES 14
Y Y •Teletype: LA 68
Herrick, Waddell & Co., Inc.
Mr. Craven was
ficer of Craven
previously
& Smith.
an
of¬
Com.
Wagenseller £ Durst, Inc,
•.
Full Contribution
Growers Inc.,
Arden Farms Co., Pfd. & Com*
LAKELAND, FLA.—Harvey B.
Y To
Boston
Stock
the
be pro¬
tected from punishment for viola¬
veto whether cast
Chronicle)
BOSTON, MASS.—Draper, Sears
Co., 53 State Street, members
Guaranty Trust Co., escorted the
inspected
Draper, Sears
(Special to The Financial
leave,
not endanger any nation's
Nolan
has
recently been with
security in the event of a break¬
down during the process of tran¬ Seipp, Princell & Co. Mr. Wright
prior to serving in the armed
sition under the treaty.
that
firm
Jones, president,
D. Sinclair Scott, secretary-
must
Provision
new
F.
treasurer.
&
of Governors' room.
As the breath we' draw:
Leave to live by no man's
Underneath the law."
E.
ticker department and the Board
;; Y
operation of
dangerous projects in a n^nner
contrary to, or in the aMence
of, a license granted by the
international control body.
4.
securities
interna¬
authority.
Creation
e.
the
better way to pre¬
no
racy—a
Seizure
c.
know
to
nue
business.
opporr
were
ment, Of the following; activities;
welcome^ by.JSmil Schram,
tunity—political, religious, social President, and John A. Coleman,
a. Illegal possession or use of
and economic.
Chairman of the board. • Temple
an atomic bomb.
I
Geo. F. Jones Co.
Ransome J.
way
I know
our
certain punish¬
means
man.
ture! but they
Prohibition, including provis¬ with
swift
internationalism that protects:
they are unwilling to be fobbed quote from
off by mouthings about narrow tion:
nit
find excuses for
outlook, etc., etc.
we
unfavorable
learn the rest
to a very advanced point. In ob¬
Chapin N. Wright have become
taining atomic energy for peace¬ treaty and
agreed to by all. The associated with Stifel, Nicolaus &
ful uses, you have gone about 75%
stages must be so designed as to
Co., Inc., 105 West Adams Street.
of
the
way
toward
a
deadly be fair and
equitable to all na¬
Mr. Leinss, prior to serving in the
•weapon. The deciding factor is the
tions; they must bring the system
good or evil intention of those of safeguards
fully into being as U. S. Army, was with Earl I. Cusengaged in the manufacture. Does rapidly
as
possible; and they tin & Co. for many years. Mr.
that not demonstrate the absolute
lazy.
declining
markets,
.
ervation
ion for
mission recently unanimously re¬
ported that control of atomic en¬
ergy
is technologically feasible,
although it carefully refrained
from going into the question of
are
bad
as
i
»
carry
Com¬ Y
Atomic
.
energy research so as to make
it an aid to social purposes and
In this connection, it is inter¬
esting to note that the distin¬
guished Scientific and Technical
of
such
interna¬
tional agency to lead in atomic
eignty.
that
.
bomb.
Committee
access
resources
and
authority
adequate to carry out its dayto-day responsibilities.
fetish. Other in¬
of
us
When security prices are
themselves, instead of facing the issues squarely and working
out their
I reaffirm my
with
processes
diminution
f
causes most of us to follow thq
When? business is good we tend to let up ori
,
presence of
within the
some
you
-
mea¬
require the
officials of one nation
territory of another;
they
include
customs,
mails,
treatment of war prisoners, and
so
forth. Every treaty involves
that
oppose totalitarianism. We oppose
YOURSELF; This you can do best by facing conditions squarely—„
b. Sufficient control of each slavery, whether imposed by the
step in atomic energy produc¬ State or imposed by the individu¬ see your customers now—go back to work—have faith in yourself—
ts tion1 to prevent diversion for al. We are ready for change when and in the ultimate future of sound business enterprise in this
illegal purposes* ^ Y
change is 'marked by wisdom. We country. With such a creed as this you are betting on the best pos¬
;l g
c. f An
international agency are consecrated to the pursuit of
why national sovereignty should
a
time
•:
^ would be the most inspected.
I
I am at a loss to understand
be made such
for
Most of
RIGHT
sions.
time America
some
Free
the
try of ours—this infinitely pa¬ ternating optimism and pessimism are only natural with a good
tient, this quick-rewarding, this salesman.
They are not to be taken too seriously. If you were the
slow to anger, bold, independent,
in atomic energy or to detect just, and loving Mother of us all. type of person that could be satisfied doing a routine job on an as¬
them
soon
enough to protect
To uphold her, we oppose dic¬ sembly line, which varied little from day to day and required no
complying states against the tatorship of the Right or of the creative ability! you wouldn't have such problems to solve. THE
hazards of violations and eva¬ Left. We
oppose despotism.
We
international
control
of uranium and
desire to keep your
you
inspection sufficient to
prevent unauthorized activities
:
as a
production
can,- if he chooses,
of the alphabet.
follow—but it
easiest to
If
WILL
tional
The Soviets protest that inspec¬
tion violates national sovereignty.
cept inspection
interna¬
an
the
The control must include:
a.
.
Gromyko,
willing to
of
agency
use
war.
N
that—than
effective control
thorium,
materials, and of
their products to the extent neces¬
sary to ensure their use for peace
and
prevent their diversion to
Soviets, either in full of in part.
repeated this position sev¬
Better
the irreducible minima
fissionable
of
He has
disaster. America is
are
1. Control through
tional
declaring the American plan, as
presented,
unacceptable to
the
eral times.
Here
essential to the
of atomic energy:
the frank, unqualified state¬
ment
was
except
is the
GOOD
Human nature being what it is,
'7
lines of .least resistance.
our
and.
weapons
you
to pursue.
them is when THEY NEED YOU.
see
(atomic, biological, bac¬
teriological,
gas
and
others),
tion
It
first
SHOULD
tell
you
THEIR
Quotations end information
on
=
'
f
nil California
•
,YY-
•:
tremblings
Tomorrow's
without
But
the "up"
decline the greater
„
.eqtiqlly
a
as
m
for
gauge
liefs
(Continued from page 1789)
gins plus profits made earlier in
the year provided cushions -fof
absorbing losses.-,
;
is in market action that you
the translation of the be¬
see
who
ties.
and
In
addition, capital in the in¬
banking, business, has
been ',increased
Substantially* in
recent years and at the same time
risks in security flotations, have
been
more
widely ? distributed
of millions
daily buy and sell securi¬
A lot of this 'actibn is
hopes
vestment
also be indicating some- frankly speculation? But with¬
out
speculation :! doubfeilf
thing wrong. 4 4
>
},
may
the dullness after
the longer
a
market action
may
dullness*
more
is
,
future market action.- For it
,
*
X
•.
.
:
*
'-J:'?-'. there would
.
arguments and
I know that
-
.'■*
•
tion
be distrite*
ever
than
accumulation.
or
:
'-0
,
few weeks
A
before.
one
more
ume
carrying securities other, than
governments.
The ^division
of
loans against U. S. Governments
and other securities is not avail¬
able
11
was
than 3%%
years
ago
an
committed
of
before $
to, 1944p and
prior
the "purpose!' • distinction
first made in the reports col¬
1937,
was
lateral
this
ments
col¬
all
banks,
lumped
"together.
loans en
govern¬
were
*
Inasmuch
size would have been handled by
the
from
lected
of the total.
issue
drives, and the modest vol¬
of loans;: for purchasing or
loan
For example, on
of whom
no
for
Ten
Sept.
borrowings on
in
Government 'obligations
S.
the security'loan-picture: of re,cent years, the peaks and valleys
generated by the successive war
the risk was
among ,228 • underwriters,
on
spread
ago we saw
distribution.
they
ever
stock
It; started at
solve nothing
possibilities on a rally.
about 195 and lastediall, the
and, who knows, may ; even
Nothing exciting has hap¬
way up to 212.
The subse¬
get you a bloody nose or dis¬
pened since the previous col¬ colored eye if you argue too quent break was caused, by
umn
was
written.^ At least
public selling. Right now the
much.
V
*
*
*
'
" ' \
first fragmentary signs of ac¬
nothing exciting so far as the
cumulation are beginning to
market is concerned. The past
The big problem we face
seven market days have been
is to decide what the market appear.: These may be false
harbingers. Perhaps we first
given over to backing and will do from here on.
best
At
U.
the, $38. million offering of Cincinnatis:Qas and Electric common
'T'.
second guesses of what made
the clock stop are pointless.
the dominance- of
-
,
■/;
sharp up move
any
reports
I continue ,ta &ticJk. to
hide a serious organic
condition.
A market which
tumbled and stays on its back
Whyte
being formed. Don't
now
expect
learned
useless.
4
analogy can be carried
further.
A neglected head¬
ache which becomes chronic
Sj WALTER WHYTEBase
\'V--
The
Markets
Walter
sort of for¬
are
gotten.
Thursday, October 10, 1946
CHRONICLE
THE COMMERCIAL & FINANCIAL
1834
as
relatively
a
were
small
•
perhaps
number
'
though: the
*
*
*
have
Last week I gave you
two
during the proc¬
frac¬ points to watch in the aver¬
tion have held. Maybe this ages. The first one was 164,
the second 175;
So long as
isn't much to boast about. But
the market stayed between
in a market which runs like
those two figures there was
a
scared rabbit every time
But all
ture.
the lows of 164 and a
ess
to
that
former
the pic¬
dominate
to
seems
.
The
the
noticing.
anything.
1
:-.',*7;
'
*
look the market is now
unsuspecting, those who
that
confident
new
a
are
ages
moving
aver¬
approximately 169,
up or down a point
being dissipated. I don't mean
the situation is being cleared
*
represents loans against
against other securities.)
(Upper .section >of shaded area
/
ments, lower section* loans
!
;
Member Banks
•
govern^
BILLIONS OF DOLLARS
point¬
Thursday.
—Walter
Whyte
views expressed in this
do
not
necessarily at
those of
any
the
presented
those of the author only.]
time
"Chronicle."
as
with
coincide
They
are
While such action isn't
or so.
gradually conducive to yelps of
had arrived, is
era
More next
article
the
the magnitude of
is apparent.
decline.
{The
As this is written
stocks,
the change
'20s? was on cor¬
ings if not to advance, then
not to any more than a minor
.
*
/ The confusion which start¬
ed when the first crack hit
were
$
$
...
;
built.- But whatever the out¬
further, is worth
any
were
porate
■<-
accompanying chart shows
security
of
bulk
coming before a solid base is
somebody belches this, re¬ nothing concrete to point to.
Prices would have to move
fusal, or call it hesitancy, to
out of that area to indicate
scare
the
market," said
4
the
Security Loans of the Weekly Reporting
4
y •
in. Leading Cities,
conditions
the
see
riod, and
loans made in the
ready much more widely spread
than in the '20s.
the whole interwar pe¬
factor in
distribution of risks then was al¬
;
filling,
than a fifth this
of underwriters, and the
no more
neither
moans
glee
indicative of
of misery.
All this,
-
it
is
however, doesn't answer the
and confidence is return¬
again. Nothing like ? it. important question which
The situation is analogous to added up means "What, from
here on?" *
the man with an old head¬
*
*
up
ing
•
after
a
Well, based on past per¬
the formances, any danger which
is averted, even though tem¬
while he becomes ac¬
customed
way
painful but
At first it's
ache.
it4 That's
to
it is with the /market.
started down porarily, may mean that suf¬
ficient forces will arise to
first
it
When
could hear the chatter of
teeth and the trembling of
you
this
make
the mar¬ tion last
hasn't gone haps even
knees. But now that
ket is down and
the fears and
down any more
Established 1858
y//'
H. Hentz & Co,
'
',:v:
York
New
York
New
ir.
York
New
New
Curb
Exqjiange
Exchange
Exchange
Inc.
Exchange,
of
Board
Orleans
And
Stock
Cotton
Commodity
Chicago
'■ 4
Members
Trade
Cotton Exchange
other
Exchanges
NEW YORK 4, N.
CHICAGO
DETROIT
time,
long
a
per¬
permanently. This
A
drives
sheet
balance
me
A study of future busi¬
prospects based on
crazy.
Bldg.
GENEVA, SWITZERLAND
in operation in 45 of the
including an interpretive
analysis of all court decisions on
the fair trade laws, samples of the
fair trade laws and other laws re¬
trade,
48 states,
of
Nassau,
;
Pacific Coast
Securities
New York
15, N. Y.
'30
*20
L
V
?; *• ;-v V." /•. /•• •';
-
international
covering raw ma¬
terials and commodities—review
of reports to be
printed every
week
in
Spanish, French and
English — Atlas Publishing Com¬
pany, 425 West 25th Street, New
York 1, N. Y.—year's subscription
World Markets
after the
—
weekly
$10.00.
precipitous decline from
LAMBORN & CO.
99 WALL
on
significant also to note the
proportion of borrowings by
members of the New York Stock
It is
Hand¬
book on the New World Organi¬
zation by Louis Dolivet, with a
preface by Trygve Lie, SecretaryUnited Nations, The—A
Pacific Coast Exchanges
STREET
NEW YORK
5, N.Y.
Schwabacher & Co.
Members
Nero
SUGAR
Exports—Imports—Futures
New
York Curb
COrtlandt
San
(Associate)
Teletype NY 1-928
—
Santa
Oakland
-Fresno
of the
United Nations—
Farrar, Straus and Company, 580
Fifth Avenue, New York 19, N. Y.
—cloth—$1,75.
of Trade
Wires to Principal
—
"
New York 5, N. Y.
7-4150
Francisco
Monterey
4;
-
Exchange
Exchange
Chicago Board
14 Wall Street
Private
DIgby 4-2727
York Stock
General
—
Offices
Barbara
Sacramento
With A. W. Benkert Co.
Thomas
Mason
and
J.
Lowell
Crockett,
William
A.
Yeagher,
joined the staff of A. W.
Benkert
&
Co., Inc., 70 Pine
Jr. have
Street, New York City.
.
.
A
(June 1934). The
exceeded 3.14%
0.68% figure for Aug.
the lowest
That
ever
100%
31, 1946, is
"
' !
recorded,
"margin
require¬
ments and absence of credit sup¬
for stock holdings do npt
wide
swings in stock
prices is abundantly clear. With
port
eradicate
investors
and
speculators free to
buy and sell, there is nothing to
prevent their collective judgments
from being registered in the
price
quotations. Just what effect 100%
margins has had on stock price
movements-remains
point.
The
a
disputed
unquestioned fact is
1929 peak.
low
Executed
Orders
'AO
*35
-
Borrowings, from that the stock market is in an
all sources, by members carrying
unprecedentedly liquid position.;■*
markin
accounts came to only
However the economic panora¬
$377 million of which a part was ma unfolds, the
painful task of
secured by government
obliga¬ paying down loans on stocks that
tions. At the same time, custom¬
have declined .in ; market .value
ers had built up free credit bal¬
will not-be-a serious
drag on
ances
with brokers of $647 mil¬
lion, available for security pur¬ consumer spending; ?k > x y - /•$\
chases,
'
' ' /,
\
the
0Q. • '^jfff'00^0
—paper,
trade
Y.
PITTSBURGH
Fair
Borrowing* of Stock Exchange
sounds like I'm saying that lating to fair distribution, and
model fair trade contract forms $$0-,0 :0f: Members* there'll be no more reactions.
suitable for use under the fair
Figures reported by members of
Of course, that's silly. I don't trade laws—the National Whole¬
the New York Exchange which
know if they'll sell off more sale Druggists' Association, 330
carry
margin accounts tell the
or not.
What I mean is that West 42nd Street, New York 18, same general story. Customers'
N.Y.—paper $5.00.'
indebtedness to brokers partly on
for the: time being it looks
the security of government obli¬
like the immediate danger of
Financial and Operating Data of gations, has been declining stead¬
more sharp breaks is over.
Thirty Oil Companies for the Year ily since the 100% margin regu¬
1945 — Joseph
E.
Pogue " and lation was put into effect. The to¬
Frederick: G. •;• Coqueron — The tal for Aug. 31 was down to $723
I don't base this on any sta¬
Chase National Bank of the City million, or practically the lowest
tistical or fundamental causes. of New York,-Pine Street corner levels reached in 1932 and 1933
ness
N. Y. Cotton Exchange
condi¬
temporary
Basis and Development of
Trade, The—a compendium of the
economics and the
law of fair
of
On
Aug. 31, just before the Septem¬
ber break in stock prices, listed
shares were worth $74,350,000,000.
Against this amount, total mem¬
ber
borrowings of $509 million
amounted to only 68/100 of 1%.
From January, 1926—when such
ratios were first compiled—up to
the stock price collapse of Octo¬
ber, 1929, this proportion ran be¬
tween 8 and 10%. Since the de¬
pression low of 1.18% at the end
of July 1932, the ratio at no time
Exchange to the total value
stocks listed on the exchange.
Mitchell With Merritt
William H. Mitchell has become
affiliated with King Merritt &
CO.,
Inc., 55 Liberty Street, New Yock
City.
Mr. Mitchell
with Investors
was
prfeviously
Syndicate in theii
"
Portland, Me., office.
Carrick With Livingstone
(Special
SAN
to Thb
Financial
Chronicle)
FRANCISCO,
n
CALIF.—
John A. Carrick has become asso¬
ciated
with
Livingstone
317 Montgomery Street.
&
Co.
.—
Volume
THE COMMERCIAL & FINANCIAL' CHRONICLE
Number 4532
164
1835
■a.
goods?were gradually replaced by some cases, it would not be pre¬ attain
complete
semimanufactured and manufac¬ ferable to extend financial assist¬ functions.
Requirements lor
tured articles. The importance of
ance
correlation
*
?
of
■;
by
purchasing abroad
a
larger amount of commodities of
Staff
Service
in
organization
recipient of our prod¬
(Continued from page 1784)
means
the service of advice or
ucts rapidly declined, while the which we
could make
tangible counsel, as distinguished from the
elements in the., determination of the ability of the end-consumers
Americas, Asia, and to a lesser use, rather than by swelling the function of authority or command.
t^e fields of economic activity in importing countries to pay for
extent, Africa, imported more and account of our receivable foreign
most. appropriate for and most the products irhported.
This service has three phases:
='
•
more of our products..
assets; especially so when our Ra¬
;
the informative; the advisory; and
likely to be successful in that
Specialization selects the types
On the otffer sides of the bal¬ tional resources begin to dwindle.
the supervisory.
?; ecmntry^CSi^ $?? ?
W of industries which can be eco¬
Some of the foregoing concepts
ance, our imports, which in the
-The degree ta which all those nomically established in a country
There are two prime necessities
early days were principally com¬ have been consistently followed
in efficient Staff Service, viz;—
natural, human as well as finan¬ but does not determine the time
posed of finished manufactures, in our national policy of foreign
cial factors exist favorably and at which these industries will ac¬
Coordination and Infiltration.
progressiveliy changed to crude trade; some others temporarily
combine efficiently, ultimately de¬ tually begin to sell their wares
The
term
"Coordination"
de¬
materials and semi-manufactures. or permanently obscured.
?••? \.■■".'.'••iV.
termines, ;for each area of the abroad.
scribes the necessary method of
Europe lost its outstanding sales
world, in what field
economic
The
point at which the * real position and the Americas, Asia
Organization for Foreign Trade
sound Staff Procedure but "Infil¬
activity each nation can special¬ business of exportation will be in¬ and
An now let us consider those tration of knowledge" is the ul¬
again to a lesser extent Af¬
ize to advantage. The fitness of itiated
by the specialized indus¬ rica, emerged as important sup¬ requirements of organization nec¬ timate purpose of all Staff Activ¬
a country to produce certain com¬
tries, is the time at which a per¬ pliers of our needs, s ;.
essary v for
a
successful
export ities.
modities or provide certain ser¬ manent excess of production over
Staff Service is not alone for the
business, which after. all, is my
vices is, in the end, evidenced by the domestic
demand, has been at¬ ? Must .Be Willing to Import;
subject. '
top leader. It comes to him first
its ability to manufacture or sup¬ tained.
Experience has repeatedly ; .But one factor in this picture
It may seem trite to say that for he needs it in the making of
ply them cheapest.
indicated that no industry looks must be recorded and
wisely con¬ there must be a full understand¬ his own decisions. But the subord¬
for a stable export trade as long sidered. The
physical volume of ing on the part of anyone organ¬ inates also need it in the execu¬
'Immense Benefits of Foreign
>
as the
home requirements easily our
imports of foreign goods, did izing for
Trade
export, of all the funda¬ tion of their responsibilities.
absorb output.? Opportunistic ex¬
not, over this same period, keep mentals effecting world
It is not alone the leader who
trade, and
^Provided the exchange of goods port business, so common in the
pace with the rhythm -of our ex¬ a
very particular and specialized has important things to tell his
and service s is unhampered United
States, contributes little
panding economy.
knowledge of the special branch subordinates. These subordinates
through the channels of interna¬ firmness to the texture of inter¬
The reason for this is not hard of export that is under considera¬ likewise have important things to
tional commerce and finance, the national relations and is not worth
to discover—and though perfectly tion for entering or carrying on. tell the
benefits that befall society through
leader; things he should
considering.
«
obvious has been
Europe
as a
"
...
■
,
selected
intelligently
specializa¬
completely
over¬
The second condition establishes
All too often, the objective or
purpose of the organization is not
know in the exercise of his lead¬
looked, I am afraid, and has led
ership. And they have important
foreign importers to much fallacious thinking and
well known or known to but few. things to tell each other also. This
in foreign ex¬ heaped much abuse upon America
ducers' goods that thus becomes
Let me give you by way of ex¬ mutuality of things to be made
change for the goods purchased for not wanting to buy, but rath¬
available for the satisfaction of without
ample, the objective of the Com¬ known runs through all relations
resorting to transfer of er, and only, to sell and sell and
of
superiors,
subordinates
and
human wants, is vastly increased
pany I represent. It is
gold; it reaffirms the necessity of sell.
"To obtain as a minimum
equals throughout the organiza¬
by the possibility of producing
tion of activities are immense. The
consumers':: and
of
volume
pro¬
the
ability
make
to
of
payment
the maintenance of the Balance of
them ^where they can be
supplied
economically; that is, in the
largest, quantity per unit of in¬
vestment
of labor, management
and capital.
■
the International
comparative disadvantage is
? smallest,.
;
for
times
their
infancy
or
at
to foster in
undertakings hav¬
nation
a
ing eventual
ties
overall
an
availability of foreign
permit remittances
exchange
.
It may,: however, be wise
(
to
to
the originating country*.;
physical? and human con¬
The
ditions
which
economic potentiali¬ periority of
encourage
uneconomic
ac¬
duction
determine* the
services,
tection.
the pro¬
commodities and
usually
-
Peoples of nations poor in re¬
will produce less wealth
with their efforts than the people
sources
internationally
traded,
are not restricted
the boundaries of a single
but
larger
cover
su¬
nation in
a
of some
tivities vital to its defense or pro¬
world; hence, with
within
nation
of
areas
the
few ^ex¬
very
avail ceptions of which diamonds is an
opportunities of outstanding one, competition re¬
foreign trade, the volume of goods mains open between a number of
of rich nations, but if they
themselves of the
available
to
them
through
ex¬
change will be far greater than if
tfiey attempt to produce all things.
Pol¬
promoting self-suf¬
No nation is self-sufficient.
ities aimed at
ficiency
through
artificial
re¬
straints and barriers to volume
importation of needed or desired
|; commodities, is detrimental to
a
remove
;
Let
us
look at the facts.
that share
payments of the
of all markets for
Taking the year 1938, a good
the products sold, product by
trading nations;
representative prewar year, 85%
product, territory by terri¬
It is of importance further to of our imports by value were ac¬
tory, to which our capacity in
point out that, continued imports counted for by only 100 items.
relation to the industry as a :
of gold, in payment of exports 41% of our total imports, for a
whole entitles us, and, to ac¬
principle of specialisation, of
goods and services, react un¬ value of $800,000,000 were duty
complish? this
participation
however, should not be misconfavorably on the economy of both free. Items on which the duty was
ratio
through the exercise
trued as denying nations having
the exporting and importing coun¬ nominal, accounted for 32% of our
of judgment, so as to insure
ah
decided advantages in
any
tries, ,weake»*ng
the
financial imports for a value of $618,000,000.
the maximum continuing refield of production or service,
structure of the nation deprived
Thus, 73% of our imports, again ?? turn on investment to the
any opportunity in participating
of gold and eventually increasing by value, in a normal year are
corpoijation." in the productive cycles of the
the price levels in the exporting not seriously affected, by duty.
After one knows what he is try¬
wtorld.
So when we talk of increasing
nations, taking payment in gold.
ing to do, then, in light of all
I From the point of view of the
The last indispensable condition our importations by lowering tar¬
the facts possible of obtainment,
general welfare, it is desirable of foreign trade relates to the abil¬ iffs, we are talking about approxi¬
the organizer must follow—and
a* country devote its resources not
ity of the ultimate consumers, in mately 30 % of our .total normal
again I don't want to be trite—
only to the expansion of those the foreign markets ?to buy the imports,
the following-steps in the order
enterprises for which it especially commodities
and
servicesex¬
To double
our
total imports,
given: \
qualifies but confine those activ¬ changed..
means
increasing this 30% area
First, Analyze; Second, Organ¬
ities to lines where its compara¬
To prevent imported goods re¬ six-folcL
ize; Third, Deputize; and finally
tive advantage in the cost of pro¬ maining unsold on the merchants'
We, as a nation, have succeeded Supervise. ;
duction is greatest; reciprocally, shelves -and
services
unutilized, willy nilly- to World Economic
Whether it be?organizing foi
unfavored
nations ? should? limit there must be sufficient purchasr Leadership. The method by which
Export or for a Domestic business,
manufactures to those fields where ing power in local currency, and we
discharge this obligation will the steps are the same, and there
most
country's welfare. They
labor, 'management and capital
from the fields of activity coniducive to the best return to the
| qation, breed wasteful economic
countries. Even when the
produc¬
tion of a commodity is limited to
a
single nation, competition still
exists
ducers
between
of
the
various
pro¬
that
nation, unless the
country is ruled by a regime of
managed economy. So, American
manufacturers
of steel, automo¬
biles, electrical goods, etc., are
highly competitive at home and
abroad,
"
.
Changes in II.
,Trade Relations
In the three quarters
of
a
cen¬
depend in no small measure, upon
willingness to accept world
tion.
The infiltration of the true ser¬
vice of knowledge cannot be con¬
ceived
top
until it has evolved
Only when all have the right
through an organized
machinery for the expression of
such right, as a stimulus to its
exercise, can there be a truly in¬
formed leadership.
to be heard
;
To summarize, top management
organization planning for success¬
ful export business involves the
same principles and their careful
application as does any* other
effort. Since Export in¬
volves not only domestic consider¬
group
ations
exports. ? '
? After all, the final purpose
organized industry and commerce
method through which leadership
topsy-turvy economical,
and social world.
goods. This optimum level in the
Foreign Trade
Now
as
to
a
few of the
indis¬
pensable conditions as a basis for
Foreign Trade:
;
Specialization is the necessary
prerequisite of international com¬
merce but not sufficient unto it¬
self.
To make
the wheels of foreign
three other conditions
respected, the first hav¬
trade turn,
must be
ing to do with the availability of
the
products to be
exchanged
largest
needed
and
possible
amount
desired
of
economic
-
ers.
After the
1873
crisis, an ex¬
of
tained
but by
the essentialities and amen¬
ities of life available to" its people.
of
sponsibility
The Leader. He
people who per¬
correlates
the
form these
duties.
swelling into rivers of American
goods for export during the early
Exports are of importance inas
much as they contribute to pro¬
vide
ance
20's
ment of both. ; ?
exports appeared, limited
in the beginning but progressively
cess
and
The
late
30's.
character
of
??■}:?;
our
i interna¬
tional trade also underwent strik¬
the
means
for
the
procure¬
political
.
Functions may be unlimited in
J. W. Goldsbury
i
These
show
facts
the
import¬
? :
V v , t principles or organization.
But not until there is a general
wishful
expectations,
understanding
of
the
Common
many of our foreign loans, out¬
standing and planned, may never Purpose can there be that real
and
Co.
MINNEAPOLIS, MINN.—Offic¬
ers
of J. W. Goldsbury Co., 807
Marquette Avenue, are Joseph W.
Goldsbury, President and Treas¬
urer; Rena W. Goldsbury,
VicePresident, and Joseph C. Golds¬
bury, Secretary.
J. W. and J. C.
Goldsbury were both officers of
the former J. W. Goldsbury & Co.
of understanding the formal
Despite
ing change.
^
f
;
Raw
abroad, the second with the possi¬
materials, and foodstuff, be refunded, because of the in¬
bility of: settlement of interna¬ which previously constituted the ability of the borrowers to honor
tional financial obligations result¬ main classes of our contribution their obligations.
It is worth considering if, in
ing therefrom, and the third, with to the international movements of
specific ta§k»
number, according to the proced¬
enjoyment of wealth can be at¬ ure necessary to attain the given
solely through imports of purpose.
a
Formal correlation of functions
persistent
excess i of i imports foreign commodities and services.
The prosperity of a nation is is the task of The Organizer. His
characterized;
our
[merchandise
trade, which Avas counterbalanced not measured by its accumulation job is to correlate duties as such.
by heavy investments of foreign¬ of precious metals and currencies Correlation of spirit is the re¬
world.
considerations
world
Function definition is the form
of the United States with the out¬
Prior to the depression of 1873,
but
also, export business — especially
under present and foreseeable fu¬
ture conditions — involves many
done.
delegates to each subordinate his
side
—
ganization engaged in Export busi¬
ness, having within its own organ¬
ization, the means for proper eval¬
in organization
that assigns all
uation of the risks involved in
of functions, and is the organizational
doing international business in a
ance? imports are more beneficial
the economy of a nation than
to
own
Indispensable Conditions of
similar ser¬
moving from the bottom
upward.
—
the
finally living standards.
a
vice
,
.
is to place at the disposal of man
and
merely moving from the
downward. No organiza¬
truly unified in spirit ;
certain keystone principles of
Organization which, if the re¬
added complexities requiring an
leadership, especially in the sulting
organization ? is
to
be
spheres of international finance sound, require careful adherence. automatic' organizational vigilance
and intelligence for the detection,
and service. Certain is one thing
•These are: (1) Leadership; (2)
interpretation and adaptation of
that- we can not go on lending
Delegation, and, (3) Function def¬
organizational procedure and ac¬
if we are not to be repaid. Un¬ initions.
tion, lest these ever-shifting "rules
wise
international
loans
enrich
Leadership represents authori¬ of the
game" completely confound
neither the one who gives nor the
ty. It must possess all the author¬ and
stymie one's efforts.
one who receives, and accelerates
ity necessary to exercise its lead¬
world misunderstandings that en¬
Foreign Loans
ership. It must likewise possess
danger world peace.
all the attributes of intelligence,
Today, all the world looks to
Although loans of' American
integrity and capacity in sufficient America for credit — for mater¬
money abroad may, at times, be
degree to warrant the authority ials
for know-how.
essential
to
the
overall world
given to it.
How long will the world sellers'
economy, including our own, they
Delegation is the center of all market continue for the United
are
not a substitute for domestic
imports of services1 as well as processes in formal organization. States? How long should it?
In essence, it involves a double
goods - as providers of dollars;
We cannot go on selling in end¬
often they delay the solution of responsibility. The one to whom less volume if there is no prospect
authority is delegated is respon¬
problems instead of facilitating it.
for a final balance in our inter¬
sible to his superior for doing the
Contrary
to
a
deeply-rooted
national payments.
job — but the superior remains
common belief, not less erroneous
And this gets down to each or¬
for getting the job
for being of widespread accept¬ responsible
are
our
increase costs ol tury preceding the last
war,
^production,: thus lowering wages, sweeping changes occurred in the
profits, purchasing power I and picture of the business relations
'processes,
as
—
tion can be
horizontal
correlation
is the final test of a
organization.
It is the
which
truly efficient
•
duty of Leadership to
Dempster Opens
in Columbus
(Special to
The Financial
COLUMBUS,
G. Dempster
Chronicle)
OHIO —Edmund
has opened offices at
Street to en¬
1418
North Fourth
gage
in the securities
business.
:
THE COMMERCIAL &
1836
Now
Securities
N. Y.
Electric Corp., Cuba,
stock.
First
Colony Corp.
Offering—To be offered publicly at $5
a share.
Proceeds—Company will receive proceeds from
the sale of 68,880 shares and four selling stockholders
the proceeds from the sale of 63,860 shares.
Company
also will receive proceeds from the sale of 20,000 war¬
rants for common stock to underwriters at an aggregate
price of $200.
Of the net proceeds ($292,940) $50,000
will be used to pay current bank loans; about $20,000
26 filed 132,740 shares ($1 par) common
Underwriters—Herrick, Waddell & Co., Inc., and
June
will be used for
machinery and
capital.
^
pates it will use the funds for
Price
American Limoges
-
;
its building and expansion
Y;
indefinite.
% program. Offering date
China Corp., New York
Sept. 25 filed 75,000 shares of common stock (par $1).
Underwriter—Riter.,"& Co. Proceeds—Stock being sold
for account of Harry Bloomberg, President. Price—By
•
-r <-v
v•" ..;'j j ?
amendment.
•>
.
common
by amendment.
Proceeds—Net proceeds initially will
be added to general funds, however, the company antici-.
equipment, and the re¬
mainder for working
Underwriter—White, Weld & Co.
stock;
ferred
American Locomotive Co., New York
:
Acme-Hamilton Mfg. Corp.,
Trenton, N. J.
filed 50,000 shares 5% cumulative preferred
($20 par) and 82,000 shares ($1 par) common
Underwriters—G. L. Ohrstrom & Co. and S. R.
'Livingstone & Co.
Offering—Company is offering the
50,000 shares of preferred, while the 82,000 shares of
common are being sold for the account of certain stock¬
holders.
Prices—$20' a share for the preferred, and
29
Aug.
preference stock, Series A, and 1,355,240 shares .
stock (par $5).
Underwriter—Kuhn, Loeb &
Co., New York.
Offering—The 350,000 shares of first
preference stock will be offered in exchange to holders
of its 532,996 shares of $6 cumulative convertible prior
preferred stock at the rate of 1.4 shares of first prefer¬
ence stock for each share of $6 prior preferred.
Shares
of first preference not issued in exchange will be sold •*
to underwriters. The 300,000 shares of second preference
stock will be offered publicly.
The 1,355,240 shares of •"
common
will be offered for subscription to common
stockholders of the company in the ratio of one-third :
of a new share for each common share held.
Unsub¬
scribed shares of common will be purchased by the
underwriters.
Price—Public offering prices by amend¬
ment.
Proceeds—Net proceeds will be used to retire all unexchanged shares of $6 prior stock and to redeem ita *
outstanding 7% preferred stock. Temporarily postponed.
second
N. J.
par) cumulative pre¬
12 filed 30,000 shares ($100
Aug.
PREVIOUS ISSUE
Colortype Co., Clifton,
American
*
Acme
Registration
in
INDICATES ADDITIONS SINCE
•
Thursday, October 10, 194$
FINANCIAL CHRONICLE
;
July 18 filed 100,000 shares each of $100 par prior pre¬
ferred stock and $100 par convertible second preferred
stock
Securities Corp., New York.
stock. Underwriting—Union
stock.
Price
by amendment. r Proceeds—Net proceeds, with
other funds, will be used to redeem $20,000,000 of 7%
cumulative preferred stock at $115 a share plus accrued
dividends. Indefinitely postponed.
American Water Works Co., Inc.,
will
$11.50 a share for the common. Proceeds—Company
apply proceeds to fully discharge ? secured demand
notes, mortgage notes
benture indebtedness.
r
Aerovox Corp.,
and
partial discharge of de¬
Bedford, Mass.'
Chicago. Offering—The debentures will be of¬
fered publicly. The common shares will be issuable upon
the exercise of stock purchase warrants for purchase of
common stock at $2 a share above the bid price of such
common on the effective date of the registration.
Com¬
25,000 common shares to the
warrant. The remaining war¬
rants will be sold to officers and employees of the com¬
pany. Price—Debentures at 98. Proceeds—Company will
use $1,025,000 of proceeds of debs, for payment of an
indebtedness to Bankers Trust Co., New York. Balance,
will be added to working capital. Offering postponed.
will sell warrants for
underwriters at 10 cents a
exchange offers are to be sold for cash to
For details see issue of April 4.
American Zinc, Lead & Smelting
Inc., New York
of 50-cent par common.
Hano; Gearhart & Co.,
Inc., and Burnham & Co., all of New York. Offering—
The shares will be offered publicly at $6 a share.
Pro¬
ceeds—Estimated net proceeds of $656,250 will be added
to general funds. Temporarily postponed.
Express lnternat'l Agency,
Under¬
offered
stockholders of record
Sept. 13 in the ratio of one additional share for each
four shares held at $35 per share. Rights expire Oct. 21.
Unsubscribed shares will be sold to other persons in¬
cluding officers and employees.
Price, $35 a share.
Proceeds—Net proceeds, estimated at $6,915,285, will be
used to defray part of the cost of its plant expansion and
subscription
to
coXhmon
improvement program.
American
.
.
Broadcasting Co.,
Inc.,
N. Y.
stock.
Offer¬
be sold by com¬
950,000 shares ($1 par) common
Underwriter—Dillon, Read & Co. Inc., New York.
27
June
filed
ing—A maximum of 100,000
shares may
to persons, firms, or corporations with whom the
corporation had network affiliation agreements on March
31. The remainder will be offered publicly.
Price by
amendment. Proceeds—To prepay notes-payable to ac¬
pany
quire radio station WXYZ, to construct broadcast trans¬
mitter for station KGO at San Francisco and for working
:
American
Cladmetals
Offering—To
share
of preferred
••
equipment, for
-
per
v
'
i
•
•
New York • Pittsburgh
and other cities
•-
\
Shares are being sold
(no par) cumulative first
:■.<£*
•>
.
(letter of notification) 41,000 shares of 5%
preferred. Offering price,
12
Snyder & Co., Topeka,
Borchardt
(E. H.)
Florida
& Co., Belle Glade,
Black, Si vails &
Proceeds—Working
& Co,
,
Bryson,Inc., Kansas City, Mo*
stock.
M.
H.
Co. Offering—Shares were sold to the
underwriters on July 29, 1946 at $10.70 a share. They
will be offered to the public at $12.50 a share. Offer¬
and
Byllesby
ing
indefinite.
date
Blumenthal
(Sidney)
& Co. Inc., New York
Aug. 30 filed 119,706 shares (no par) common and sub¬
scription warrants relating to 30,000 shares thereof.
Underwriting — None. Proceeds—For reimbursement
of
company's treasury for funds expended in re¬
of 3,907
shares of 7% cumulative preon April 1, and for funds deposited in trust for
demption
preferred shares. Al¬
though it was proposed to offer the stock for subscrip¬
tion to stockholders at $10 per share, company on Sept.
20 decided to withhold action at this time.
*
Boston Store of Chicago,
Inc.
30,000 shares ($50 par) 5% cumulative
preferred and 500,000 shares ($1 par) common. Under¬
writers—Paul H. Davis & Co. and Stroud & Co., Inc.
Offering—Preferred * will have non-detachable stock
of convertible
Underwriters and Distributors
—
•
Securities
Kidder, Peabody & Co.
Founded 1865
HAnover 2-2727 7/v
Members
New York
Philadelphia ; Pittsburgh • Cleveland
*
St. Louis
-
*
of
Corporate and Municipal
Municipal Bonds
NEW YORK 5, N. Y.
Cincinnati
ft
y'
•"
New York
redemption on Oct. 1 of remaining
Co., Chicago
Boston
\.1
: y
■
July 29 filed 100,000 shares ($1 par) common
Underwriters—F. S. Yantis & Co., Inc., and
Long
INC.
Chicago
' v:.y
,
approx¬
CrJ. DEViNE * CO.
Chicago
'
Sept. 10 filed
State and
Boston
V'r
Berbiglia, Inc., Kansas City, Mo.,
United States Government Securities
48 WALL ST.,
/.
■. *
■
share (estimated market). Underwriter — Bond &i
will act as broker. Proceeds to selling
.
CORPORATION
-
ferred
—SPECIALISTS IN
FIRST BOSTON-
.
$1).
Underwriter—Blair
capital.
>
No underwriting.
preference stock, Series A; 300,000 shares
The
:
Sept. 23 (letter of notification) 27,000 shares Class A
stock (par $10) and 27,000 shares of common stock (par
Joseph A. Ball in the
Price by amendment.
July 12 filed 350,000 shares
.
New York, and the
sold by I. Rogosin,
outstanding indebtedness and expenses and
to open five additional stores in Kansas City, Mo. Offer¬
ing temporarily postponed.
share of
by six stockholders.
Public Financing
total, 140,000 shares are
Kans. To pay
Western Gas Co.
Armour and
' '.v•
Y'-.'
York
$6 a share. Underwriter—Estes,
filed 33,639 shares
public.
■
-
cumulative convertible $6 par
of common stock (par $5).
Underwriters—Rauscher, Pierce & Co. Inc., and E. H.
Rollins & Sons Inc.
Offering—Stock will be offered to
the
;
"•. ••
Sept.
proportion that one share of common be issued for every
sold to the general public. Offering—
5
.•
.
-■
Goodwin, Inc.
stockholders.
share of preferred
Arkansas
\jH
Sept. 18 (letter of notification) 20,000 shares of common f
stock (par 500). Offering—To be publicly offered at $1.20
Co., St. Louis
(letter of notification) 30,000 shares ($10 par)
preferred and 30,000 shares Class B common to
issued to Newton T. Bass, Virginia W. Bass, B. J.
$6 per unit. - Proceeds—Net proceeds esti¬
$1,179,000 will be used to pay a mortgage pn
plant, pay accounts payable, purchase
building alterations and working capital.
Y;v
.-J-.--:v:'-'
3
June
v•
being sold by St. Regis Paper Co.,
remaining 40,000 shares are being
President of Beaunit Mills, Inc.
Class A
ing—Price
Corporate and
•
and one share of common. Prices—
share.
v.-..
amendment. Proceeds—Of the
share. Underwriter — Amos
the public in units of one
Westlund, Bennett G. Tripp and
-y~;
Bendix Helicopter, Inc.,
Apple Valley Building & Development Co.,
Beach, Calif.
be
*•
Sept. 27 filed 180,000 shares ($2.50 par) common. Under¬
—
White, Weld & Co., New York. Price — By
imately $100,000, to purchase wood-working machinery
and for working capital. Temporary postponed.
Oct.
*.'•
v.*
writer
underwriters.
$7 per unit of one share of preferred and one
common.
Proceeds—To retire bank loans of
•
.r.A.
Beaunit Mills, Inc., New
Co., of Pittsburgh
July 8 filed 196,500 units comprising 196,500 shares of
voting common stock ($1 par) and 589,500 shares of non¬
voting common stock ($1 par), each unit consisting of
1 share of voting common and 3 shares of non-voting
common.
Underwriters—None—the company intends to v
distribute its common stock directly to the public. Offer¬
mated at
Co.
&
Price, Class A preferred, $10 a
To erect a guest ranch.
capital.
.
Aug. 29 filed 70,000 shares of Class A cumulative con¬
vertible preferred stock ($5 par) and 70,000 shares of
common
(50c par) and warrants for 50,000 shares of
common stock to be sold to underwriter at 5c per share
warrant and exercisable through Oct. 1, 1951 for pur¬
Treat
;
additional machinery and equipment
$1,200,000.
Si
to purchase
and
in the amount of
"
Ansley Radio Corp., Trenton, N. J.
chase of common at $1 per
preferred
share. Proceeds—Company will
receive proceeds from the sale of all of the preferred
and 100,00 shares of common.
The remaining 50,000
shares of common are being sold by three stockholders.
Estimated net proceeds of $2,300,000 will be used by
the company to pay off bank notes of about $1,100,000
share and $12 a common
pire on Nov. 21.; Unsubscribed shares will be offered
subscription to officers and directors of the company.
Price—By amendment. Proceeds—Working capital.
.
conversion of preferred. Underwriter—New-
upon
burger & Hano, Philadelphia. Price—$25.50 a
for
New York
Aug. 16 filed 199,101 shares (no par) common.
writing—No underwriting. Offering—Shares are
for
ance
Sept. 6 filed: 336,550 shares common stock (par $1).
Un¬
derwriting—No underwriting.
Offering—Stock will be
offered for subscription to common stockholders of rec¬
ord on Nov. 1 in the ratio of one additional share for
each two shares held.
The subscription offer will ex¬
July 22 filed 125,000 shares
Underwriters—Newburger &
American Brake Shoe Co.,
N. Y.
shares of common (par $5) plus
an additional number determinable only after the re¬
sults of competitive bidding are known. Underwriters—
To be filed by amendment.
Probable bidders include
Dillon, Read & Co. Inc., White Weld & Co., and Shields
& Co. (jointly), and W. C. Langley & Co. and The
First Boston Corp. (Jointly).
Offering—Price to public
by amendment. Purpose—The common stock, together
with $15,000,000 10-year 3% collateral trust bonds (to
be sold privately) are to be issued to acquire certain
assets of American Water Works & Electric, liquidate
two subsidiaries, Community Water Service Co. and
Ohio Cities Water Corp., and provide cash working capi¬
tal.
Common stock is to be offered initially for cash
to common stockholders of parent and to public holders
of preferred stocks of Community and Ohio in exchange
for their shares.
Stock not subscribed or issued under
& Co.,
Air
Artcraft Hosiery Co., Philadelphia
Sept. 27 filed 53,648 shares ($25 par) 4^% cumulative
convertible preferred and 150,000 shares ($1 par) com¬
mon. It also covers shares of common reserved for issu¬
March 30 filed 2,343,105
Aug. 22 filed $1,500,000 of 5% sinking fund debentures,
due 1961, and 50,000 shares
($1 par) common stock.
Underwriter—Ames, Emerich & Co., Inc., and Dempsey-;
pany
^
San Francisco
ftj
'
.
'•
•.
<
-
of the New York and Boston Stock Exchanges '
Boston
Philadelphia
Chicago
•
Volume
THE COMMERCIAL & FINANCIAL
Number 4532
164
Brunner
(Showing probable data of offering)
October
%
14, 1946
—...Common
Fownes Brothers & Co Inc
Leader Enterprises
—-—Capital Stock
Inc
Preferred and Common
outstanding preferred stock of Brunner.
EST)
A;
Inc.,
——Common
V rV-.
•'
t
<
i
.
1946
*Y."; if
'•
& 'iTVtb.f. .J? 'fy'l
Class A and Common
cur¬
.
v-
.
Freres & Co. (jointly).
Offering—New preferred stock
on a
share for share exchange basis to
holders of its old preferred stock other
than the Middle
West Corp. which holds
38,564 shares of such stock. If
more than
150,000 shares of old preferred stock are de¬
posited for exchange the number of shares to be
ex¬
changed will be pro rated. Shares of new
preferred not
issued in exchange will be sold to
underwriters.
Pro¬
ceeds—Net proceeds from sale of shares not
issued in
will be offered
the preferred. Price by amendment.
imburse treasury for purchase of
Proceeds—To
exchange will be
re¬
used to redeem old
preferred at $119
share and accrued dividends,
a
machinery and equip¬
new building
Central & South West Utilities Co.
being constructed at estimated cost of
$223,700; balance
for purchase of additional machine tool
| Aug. 30 filed its ($5 par) capital stock. Company's
equipment.
stock
of the total
common, 375,000 shares will be
Offered for sale for cash. 30,000 shares are reserved for
issuance upon exercise of warrants attached to
a
pre¬
ferred stock.
Underwriter—To be determined by com¬
petitive bidding. Probable bidders include
Dillon, Read
& Co.,
Inc.; Smith, Barney & Co., White, Weld & Co.;
Glore, Forgan & Co.; Lehman Brothers and
Lazard,
George F. Jones Co.,
share, American cur¬
amount to 20
share. Proceeds—For
development of gold min-
a
ment at
purchase warrants.for purchase of 30,000 shares of com¬
mon
—
Sept. 23 filed 10,000 shares ($50 par) 5% cumulative
-'preferred and 120,000 shares ($2.50 par) common.Under¬
writer—H. M. Byllesby and Co.
(Inc.), Chicago. Offer¬
ing—Of the common, 110,000 shares are
being sold by
v stockholders; The
remaining 10,000 shares are reserved
for issuance upon the exercise of
warrants attached to
Equip. Trust Ctfs.
■r
'
Underwriting
■■■.•
Aug. 14 filed 150,000 shares ($100
par) cumulative
v
October 28, 1946
Films Inc
Savings Bank, Chicago, bal¬
working capital.
Central Illinois Public Service
Co., SpringfieUL
Burgess-Norton Mfg. Co., Geneva, III.
—
#
cago and Harris Trust and
ing properties.
;„
—Eqp. Trust Ctfs.
October 22,
$1).
Chi¬
prices to be supplied by amendment.
Proceeds—To
off $3,000,000 loan from First National Bank Chi¬
ance
Buffalo, N. Y. Price—$1 a
The underwriting commission will
cents
Delaware Lackawanna & Western RR.V,,,
(Noon)
common.
rency.
Pfd. and Com.
Bottling Co.—
Maryland Ry
:
rency)
Bonds
Rock
Western
Curtis,
to the public
pay
••
—Common
Plastic Molded Arts Inc
Red
at
&
Offering—The stocks will be offered
•
Northwest Airlines, Inc..--—_______——Common
Northwestern Public Service Co.
1
'
'
'
a.m.,
(par
Underwriter—Paine, Webber, Jackson
cago.
,
Buffonta Mines Ltd.,
Toronto, Can.
Sept. 12 filed 1,000,000 shares $1 par (Canadian
(Noon)--Bonds
——
(11:30
Central
be offered in exchange
for 23,395 shares of Class B common of
American Gas
Machine Co., of Albert
Lea, Minn., on the basis of three
shares for each Class B share.
Price—$10.25 a share.
Proceeds—Net proceeds will be used to redeem the outstanding Class A common shares of American Gas and
the
1837
Electric & Gas Co., Sioux
Falls, S. DMay 29 filed 35,000 shares of $2 cumulative
preferred
stock, series A (no par), but with a stated value of
$50 a
share, and 175,000 shares of common stock
the remaining 70,185 shares will
October IS, 1946
Duluth Missabe & Iron Range RR.
Dumont Electric Corp
Manufacturing Co., Utica, N. Y.
Sept. 13 filed 180,185 shares ($1 par) common. Under¬
writers—George R. Cooley & Co., Inc., Albany, N.
Y.f
and Mohawk Valley
Investing Co., Inc., Utica. Offering—
Of the total, 110,000 shares will be offered
publicly and
NEW ISSUE CALENDAR
Florida Frozen Fruits Inc
CHRONICLE
cost of
,
$98,386 and payment for
is to be
California Oregon Power Co.
and 95,000 shares are reserved for issuance
upon exer¬
May 24 filed 312,000 shares of common stock (no
par).
cise of outstanding warrants.
Stock will be sold
Price—By amendment.
through competitive bidding. Under¬
Proceeds—Net proceeds, together with other funds, will
writers—Names by amendment. ' Probable bidders inbe used to pay the
company's 2% subordinated note in > elude Blyth & Co., Inc.; The First Boston
Corp.; Harri¬
the principal amount of $5,268,750 and accrued interest.
man
Ripley & Co.
Offering—Stock is being sold by
Standard Gas and Electric
Co., parent, of California.
Bowman Gum, Inc., Philadelphia
Bids Rejected—Standard Gas &
Electric Co. rejected
Sept. 27 filed 268,875 shares ($1 par) common. Under- H June 25 two bids for
the purchase of the stock as un¬
>
writer—Van Alstyne, Noel & Co., New York.
Price—By
satisfactory. Blyth & Co., Inc., and First Boston Corp.
amendment. Proceeds—Stock is being sold by share¬
bid: of $28.33 a
share, and Harriman Ripley & Co. bid
holders who will receive proceeds.
of $24,031 a share.
Stock will again be put
up for sale
when market Conditions improve.
Braunstein (Harry), inc.,
Wilmington, Del.
-Sept. 25 filed 12,500 shares ($25 par) 4%% cumulative
California-Pacific Utilities Co.,' San Francisco
convertible preferred stock and
50,000 shares (200 par)
Sept. 6 filed $1,670,000 of first mortgage bonds.
common stock, Underwriter
Series.
C. K. Pistell & Co., Inc.,
B, due »1971, and 33,610 shares ($20
par)' common.
New York. Price —.$25 a/JShSre for
&
preferred
■
name
changed by post effective amendment to Central
West Corp. (Del.)
Prospectus will be issued
South
in connection with the
public invitation for sealed bida
for the purchase of a
sufficient number of such shares
as
same will be
constituted upon consummation of a
proposed
merger into the issuer of American Public
Service Co., to provide funds for
retiring the preference
shares of the issuer and American
Public
•
Service Gd..
not exchanged for shares of the
merged corporation.
Underwriters by amendment.
Possible bidders: Glore,
Forgan & Co.; Lehman Brothers-Lazard Freres & Co.
•
-
"
:
(jointly); Smith, Barney & Co.-Harriman, Ripley & Co.
(jointly); Blyth & Co., Inc., Stone & Webster Securities
Corp. and First Boston Corp. (jointly). Price
by amend¬
utility holding company.
ment. Business—Public
)
'
Central Soya Co.? Inc., Fort Wayne, Ind.
—
preferred and $11
a
share
for
common.
Proceeds—7,000 preferred shares
Aug. 21 filed 90,000 shares
(no par) common. Under¬
Co., Chicago. Offering —
; Common shares initially will.be offered for subscriptioa
be ,determined by
competitive bid¬
Probable bidders include Halsey, Stuart &
ding.
being sold by company, the remaining 5,500 ?preferred -shares and all of the common are
being sold l?y
present, stockholders. Net proceeds to the
company,,
timated at $147,500, wiirbe^used to prepay to the ex¬
1
Underwriters—To
■
are
writers
Co.,
Inc. (bonds only). Proceeds-^-Net
proceeds will be used
to
to
Glore
—
common
redeem
Forgan
&
stockholders at rate of
one
share
for eatik
outstanding 3V2% mortgage bonds of East7% 2 shares held. Unsubscribed shares will be sold to
a ern
Oregon-Light & Power Co.^ whose electric prop- 4J underwriters. Price
by amendment, Proceeds-^-Working:
+
erties were recently
acquired by the company; to pay
tent possible
capital, etc. Offering indefinitely postponed.
outstanding $149,300 mortgage liabilities. W
Off short term'Indebtedness and to
reimburse its. treasBriggs & Stratton Corp., Milwaukee
"ury for previous expenditures.
Chase Candy Co., St.
Joseph,, Mo.
r Aug. 9 filed
76,000 shares (no par) capital stock. Under- yA#
Sept. 12 filed $2,500,000 of 4% sinking fund
Cameron Aero Engine Corp., New York
debentures,
writers—A. G. Becker & Co.,
due 1961; 100,000 shares
Inc., Chicago." Price by
($20 par) 5% convertible cumu¬
Oct. 2 (letter of
amendment.
notification) 60,000 shares of common.
Proceeds—Shares are being sold by stock¬
lative preferred, and 170,000 shares
($1 par) common.
Offering—Price $2 a share.
Underwriter—R. A. Keppler
holders. Temporarily
Underwriters
F. S., Yantis &
& Co., Inc., New York,
Co., Inc. and H. 842
.Proceeds—To demonstrate the
Byllesby and Co. (Inc.), Chicago, and Herrick Waddell
Brooklyn (N.Y.) Union Gas Co.
Cameron Engine by flight tests in
company-owned plane.
& Co., Inc., New York.
Offering—Common will be of¬
May 3 filed 70,000 shares of cumulative preferred stock
fered for subscription at
$10 a share to common stock¬
Camfield Mfg. Co., Grand
($100 par). Underwriters—To be filed by amendment,
Haven, Mich.
holders at rate of one share for each two
shares held
Bids Rejected—Company July 23 rejected two bids re¬
j
July 29 filed 220,000 shares ($1 par) common stock, Un¬
of record on Oct. 19. Shares of
common not subscribed
ceived for the stock.
Blyth & Co., Inc., and F. S. Mosederwriters—Gearhart & Co., Inc. Offering—Of the shares
for will be offered for sale to
ley & Co. and associates submitted a bid of 100.06 for a
officers, directors and
registered, 100,000 are issued and outstanding and will
employees. Price—The debentures will be offered at
4.30% dividend. Harriman
be sold to the underwriters
Ripley & Co. and Mellon
by three stockholders at
100 and the preferred at
$20 a share/ The common
Securities Corp. bid 100.779 for a
4.40% dividend.
In¬
$4.50 a share for their own account. The remaining
v|gll
be of fered to stockholders at
$10 a share. Pursuant to fte
definitely postponed.
\\
120,000 shares are being offered by the company. Price
common stock
subscription rights, F. S. Yantis & Co.
$4.50 a share. Proceeds—Company's share to pay rene¬
will purchase 100,000 shares of the
Brown & Bigelow, St. Paul
170,000 shares of
gotiation refund in amount of $180,000 to the U. S.
common
for investment. Any of the
July 19 filed 35,000 shares of 4%% ($100 par) cumulative
remaining 70,009
Government, and for: additional working capital.' Offer¬
shares which are not subscribed for by stockholders and
A preferred
stock and 427,558 shares ($1
par) common
ing date, indefinite.
;.•/ ** u
officers, directors and employees will be sold to the
stock.
[
"
I
" .'*/
'
\ 1
*'
^
'/i
Underwriters—Reynolds & Co., New York.
'
'
.
.
y
■
■
.
—
^
"
„
Offer-
ing—19,079 preferred shares
*'
ferred stock
on
a
| not issued in exchange
A
"
plus 15,921 additional will be
offered to the public. Of the total
common, the company
is selling 67,500 shares to
underwriters for public offer-
Ing and 55,177. shares are to be offered in
exchange for
outstanding capital stock of Consolidated
Printing Ink
Co., Quality Park Box Co., Inc., and John Beissel
Co.,
I which will become subsidiaries.
of the company are
v
writers
In
addition, stockholders
selling 322,521 shares
to the under-
for
j
>
■
chase of
and
\
machinery and equipment, and tools, jigs, dies
fixtures:
purposes.
1
J|-
'
balance
will
be
available
for
Indefinitely delayed.
corporate
'■
■
X-*
,
<
1
r
«,
nv
i
;
V* '
1
v 1'
& '/• {
f
X
i
Carscor Porcupine Gold
MineSf Ltd.^ of
V Ontario
June 24 filed 400,000 shares of
stock.
i
»
'
tion, sinking of shafts,
increasing
Offering
temporarily
general
postponed.
price, amounting to $5,150,000, for acquisition of the
candy manufacturing business operated by Clinton. In¬
dustries, Inc., as its national candy division with plants
in St. Louis, Mo., and Chicago. The balance will be used
to
redeem
its 4%
serial debentures
and for additional
working capital.
common
Under¬
writer—Registrant will
underwriter
capital.
supply name of an American
by post-effective amendment.
Offering—
diamond drilling
and
working
Clary Multiplier Corp.? Los Angeles
v:
Toronto,
corporate
funds.
'
*
To the public at $1 a share in Canadian funds.
Proceeds
—For a variety of purposes in connection with
explora¬
common
underwriters. Proceeds—Net proceeds, estimated at
$5,856,125, will be used to pay the balance of the purchase
\
,
public offering. Price—Preferred
$103.50 a
$26.50 a share. Proceeds—Net proceeds to
the company will be used to redeem
unexchanged shares
of 6% preferred at 110% and
for
share;
•
f
Canadian Admiral Corp.
Ltd., Toronto
July* 8 filed 150,000 shares ($1 par) common stock.
Underwriter—Dempsey & Co. Offering—Stock initially
will be offered to common stockholders of
Admiral Corp.
at $3 a share.
Proceeds—$75,000 is earmarked for pur¬
will be offered to 6%
preshare for share
exchange basis. Shares
Sept. 3 filed 150,000 shares 5^2% cumulative convertible
preferred stock (par $5).
shall & Co., Los
,—Net proceeds,
repay a
a
share. Proceeds
estimated at $650,000, will be used to
$90,000 bank loan, to construct
office building at San
-
Underwriting—Maxwell, Mar¬
Angeles. Price—$5.25
Gabriel, Calif., at
(Continued
on page
1838)
a
factory and
a cost
of about
—
,
-
and
Climax
Inc.,
Industries,
convertible cumulative
($1 par) out¬
Underwriter—Brailsford & Co.
Offering— company is offering the preferred and Gen¬
eral Finance Corp., issuer's sole stockholder, is offering
the common for its own account. Prices by amendment.
Proceeds of preferred to pay company's indebtedness to
General Finance Corp., purchase equipment and real
estate and for working capital. Indefinitely postponed.
and 250,000 shares
($10 par)
standing common stock.
Co.,
Transportation
Coast
•
New Orleans,
Inc.,
La.
Oct.
(letter of notification) 27,900 shares ($10 par)
stock. Offering — Price $10 a share. Under¬
S. Hecht & Co., and Howard, Labouisse,
4
capital
of six barges
N. Y.I,
r
ceeds from the sale of
•
•
•
4
;
■
.
-f
I
;
; ;
Aug.
i
Funds for the redemption will be
preferred
cumulative converti¬
stock,
9
Inc., L. I. City, N. Y.
filed 300,000 shares
($5 par)
common
Engineers Waterworks Corp.; Harris burg, Pa.
stock.
June 24 (letter of notification) $275,000 4% debentures
Price by
amendment.
Proceeds—Go to Joseph Levy, President, | due 1971. Underwriters—C. C. Collings & Co., and
Stroud & Co., Inc., Philadelphia. Price, $101. Proceeds
.selling stockholders. Offering date indefinite.
for purchase of additional water properties or their
securities and for "other corporate purposes.
Cyprus Mines, Ltd., Montreal, Canada.
.
Denver, Colo.
Aug. 20 filed 70,000 shares ($50 par) cumulative con-;
vertible preferred stock.
Underwriter—Union Securi¬
ties Corp., New York.
Price by amendment. Proceeds
—Prior to the proposed issue of preferred stock, the
company plans to call its $3 cumulative convertible pre¬
ferred stock for redemption at $55 a share plus accrued
i dividends,
ble
Underwriters—First Boston Corp., New York.
.'x'X'X.i '•
vV ,
Aug. 28 filed 50,000 shares of $1.25
,
Crawford Clothes,
Colorado Milling & Elevator' Co.,
.
r
(par $25) and 150,000 shares of
common
stock
(par $1). Underwriters—Van Alstyne,
by amendment.
Proceeds—Of the shares being offered |
Noel & Co. Proceeds—Corporation will receive the pro¬
company is selling 100,000 shares and 15,000 shares are
ceeds from the issuance of 50,000 shares of the common
being sold by a stockholder. The company will use its v
stock which will be used to increase productive capacity,
proceeds to provide additional factory space and pur- |
add new lines of products and expand the business. The
chase machinery and equipment and to construct a new
office building. The balance will be added to working < remaining 100,000 shares of common stock and the pre¬
ferred shares will be sold by present stockholders. Of¬
capital. Offering date indefinite. •,
.
.
'
■
fering" temporarily postponed.
August 15 filed 300,000 shares ($1 par) common stock.
Underwriters—Emanuel, Deetjen & Co., New York. Price
amendment. Proceeds—Company will receive pro¬
150,000 shares and Generoso Pope,
President of company, who is selling the remaining 150,000 shares will receive proceeds from these shares. The
company will use its proceeds for payment of mortgage
notes, op$n account indebtedness and for purchase of
additional equipment. Any balarice will be added to
working capital. Indefinitely postponed.
.
common.
$8.25 per
Empire Millwork Corp., New York
Proceeds—For purchase
and for additional working capital.
; by
postponed.
Electric Co. '
Co., Inc..«
Copco Steel & Engineering Co., Detroit
,■
Aug. 19 filed 115,000 shares ($1 par) common. Under¬
writer—E. H. Rollins & Son, Inc., New York.
Price
Orleans.
Colonial Sand & Stone Co., Inc.,
Industries
Offering date indefinite.
writer—R.
Friedrichs & Co., New
(Tex.)
El Paso
Sept. 27 filed $6,000,000 first-jnortgage bonds, due 1976.
Under- t Underwriter—By competitive bidding. Probable bidders
share. > include Stone & Webster Securities Corp.; Halsey, Stuart
Proceeds—Net proceeds together with gen¬
Proceeds—To repay demand loans and for general funds, £ & Co. Inc.
(Originally company filed for 80,000 preferred shares | eral funds, will be applied to the redemption of its
$6,500,000 of first mortgage bonds, Series A, 3%%, due
par $25 and 350,000 common shares.)
'
k
1970, at 108.
;■!
*
^
;
Cooper Tire & Rubber Co^., Findlay, Ohio
Electronic Laboratories^ Inc., Indianapolis, IndL
July 17 filed 60,000 shares ($25 par) 4%% cumulative ;
convertible preferred.
Underwriters—Otis & Co. and
July 29 filed 140,000 shares ($1 par) common stock, of
Prescott & Co., Inc.
Offering—To the public. Price—
which 40,000 shares are being sold by two stockholders.
$25 a share.
Proceeds—Estimated net proceeds ©f $1,- • ■ Underwriters—By amendment. May be placed privately.
356,200 will be used to redeem its outstanding 4% deben¬
Price by amendment. Proceeds—From sale of company's
tures, due 1967, to pay certain debts and for additional / 100,000 shares for purchase of inventory, payrolls, and
eauipment. manufacturing space and working capital.
working capital.
Continental-United
Aug. 2 filed 150,000 shares ($1 par)
writers—Aronson, Hall & Co. Price
Chicago
Aug. 28 filed 150,000 shares 5%
preferred
corporate purposes. Offering temporarily
eral
:i.
Offering temporarily postponed.
requirements.
will be used for gen¬
sale of the company's 25,000 shares
pany's manufacturing plants, acquisition of additional
tools and facilities, and for additional working capital ;
(Continued from page 1837)
>
to purchase additional equipment, estimated at $250,000.
The balance will be added to work¬
ing capital. Offering temporarily postponed.
/
,
(l
$250,000,
Thursday, October 10, 1946
CHRONICLE
[THE COMMERCIAL & FINANCIAL
1838
.
,
May 31 filed 500,000 shares of common stock (par $1).
Underwriters—Sabiston-Hughes, Ltd., Toronto.
Offer¬
ing—Shares will be offered to the public at 75 cents a
Proceeds—Net
share.
proceeds, estimated at $300,000,
operations. Business — Explor-
will be used for mining
ing for
Ero Manufacturing
Co., Chicago
shares common stock (par $1).
Underwriter—Straus & Blosser, Chicago.
Price—$11.50
a share*
Proceeds — Shares are being sold by stock¬
Sept.
„
105,000
filed
5
holders.
ore.
supplied
Farquhar (A. B.)
Danly Machine Specialties* Inc./ Cicero, III*
26 filed 62,000 shares ($25 par) 5% cumulative *
convertible preferred stock and 71,950 shares (par $2)
common stock 40,000 by company and 31,950 by certain
stockholders. Underwriters—Paul H. Davis & Co., and
Columbia Aircraft Products Inc., Somerville,
$
N. J.
| Shillinglaw, Bolger & Co., Chicago. Price by amend;
June 26 filed 150,000 shares ($4 par) 30c cumulative : ment. Proceeds—Company will use proceeds, together £
with a $1,000,000 bank loan, to purchase machinery,
convertible preferred stock, convertible into common
buildings and to retire bank indebtedness. Temporarily
stock in the ratio initially of 1% shares of common for
postponed.
each share of preferred.
Underwriters—Floyd D. Cerf
by a short term bank loan.
Proceeds from the sale
preferred, together with other funds, will be used
repay the bank loan. Indefinitely postponed.
of
to
4
Co., Inc., Chicago. Offering—Company offered 59,585%
shares for subscription to present common stockholders
of record Aug. 6 at $4.50 a share in the ratio of one share
Delta Chenille
Oct.
Co;, Inc., Jackson, Miss.
$800,000 to reduce principal on
Fashion Frocks, Inc.
*
u
filed
2
Co., York, Pa.
Sept/26 filed 30,000 shares ($25 par) cumulative con¬
vertible preferred; 45,000 shares ($5 par) common; and
an unspecified number of common shares to permit conversion of the preferred.; Underwriter—Stroud & Co.,
Inc., Philadelphia. Price—By amendment. Proceeds —
Proceeds will be used to redeem $355,350 4%% sinking
fund, mortgage bondsr due Aug. 1,. 1957, to pay off
certain contracts and chattel mortgages of $72,000 and
July
outstanding bank loans.
j, -
t
,
^
A
^
**
t,
' '
24 filed 200,000 shares ($1 par) common stock.
Underwriter—Van Alstyne, Noel & Co. Offering—Offer¬
300,000 shares (200 par) common. Under¬
writers—Names by amendment. Price, $8 a share. Pro¬
ceeds—Of total, company1 is selling 150,000 shares and
July
preferred for each share of, common held. Rights
ing does not constitute new financing but is a sale of
expired Aug. 20. The offering to common stockholders
excluded the two principal stockholders who waived / remaining 150,000 shares are being sold by Apponaug Z currently outstanding shares owned by members of the
Manufacturing Co., Inc. Principal stockholder estimated
Meyers family, owner, of all outstanding stock. After
their rights to subscribe. The remaining 90,414% shares
net proceeds to company of $1,007,913 will be added
giving effect to the sale and assuming exercise of certain
and shares not subscribed to by common stockholders
to general funds to be applied for corporate purpose.
warrants and an option, the Meyers family will retain
will be offered to the public through underwriters. Price
Company anticipates expenditures of $300,000 in 1946
ownership of approximately. 58% of the common stock;
—$5 a share. Proceeds—Approximately $55,000 for pay¬
and $300,000 in 1947 for equipping and absorbing costs
Offering temporarily postponed.
ment of Federal taxes; $250,000 for payment of a loan;
of starting operations of four plants, two of which al¬
$50,000 as a loan to Palmer Brothers Engines, Inc., a
Felt & Tarrant Manufacturing Co.
ready have been contracted for. The balance will be
subsidiary, balance working capital.
,
added to working capital.
Sept.. 25 filed 251,340 shares of common stock (par $5).
:;;v:
v.
Underwriters — Lee Higginson Corp. and Kidder, Pea; Commonwealth Aviation Corp., New York
Derby Oil Co., Wichita, Hans*
body & Co. Offering — Shares are being sold by share¬
June 28, 1946 filed 150,000 shares ($10 par) 4%% cumu¬
July 19 filed 131,517.3 shares ($8 par) common stock.
holders after consummation of proposed changes in com¬
lative convertible preferred stock and 300,000 shares
Underwriting—H. M. Byllesby and Co., Inc., Chicago,
pany's capitalization and the merging into the company
($1 par) common stock. Underwriters—To be supplied
and Nelson Douglass & Co., Los Angeles.
Price by
of Comptometer Co. Price by amendment.
by amendment. Price—$12 a share of preferred and $7
amendment.
Proceeds—Part of the estimated net pro¬
a share of common.
Proceeds—Estimated net proceeds of
ceeds will be used to pay a bank loan.
Fiduciary Management, Inc/ Jersey City, N. JL
The remainder,
$3,420,000 will be used for working capital.
with other funds, will be used to expand a drilling and
Sept. 27 filed 867,420 shares ($25 par) common. Under¬
exploration program. Indefinitely postponed.
writer—No underwriting.
Offering—Stock will be of¬
Commonwealth Telephone Co., Madison, Wis.
fered for subscription to common stockholders on the
Detroit Typesetting Co.* Detroit, Mich.
Sept. 23 filed 16,071 shares ($100 par) $4 cumulative
basis of four additional shares for each one share held.
of
■
,
•
•
.Underwriters
preferred.
—
Paine, Webber, Jackson &
Sept. 25 filed 70,920 shares
Curtis and Stone & Webster Securities Corp. Offering—
Shares will be
offered for
writer
exchange for $5 cumulative
a
preferred, on a share for share basis, plus cash adjust¬
ment. Shares not exchanged will be sold to underwriters.
Price
amendment.
by
Proceeds—To
redeem at $110
share, plus divs., all unexchanged old shares.
Consolidated
Hotels,
Inc.,
-
a
($1 par)
common.
Under¬
who
will
—
receive
Dictaphone Corp., New York
Temporarily postponed.
s
;
.
—Of the
total, the company will receive proceeds from
the sale of 851 shares of preferred. The remaining shares
Dobbs Houses, Inc.,
preferred and all of the common are being sold by
Ben Weingart,, President and director.
Company will
add the proceeds to working capital.
•
Consumers
Aug. 9 filed
common
an
stock.
Power
Co., Jackson, Mich.,
Underwriters—To
be
determined
Sept
Bids
19 postponed
were
indefinitely the sale
of the
Continental Motors
stock.
Corp., Muskegon, Mich.
July 8 filed 250,000 shares 4%% cumulative convertible
preferred stock, Series A ($50 par).
Alstyne, Noel & Co.
Underwriters—Van
Offering—Price by amendment.
Proceeds—For rearrangement and expansion of the com¬
;
by
advertised for Sept. 24.
^
75,000 shares
£ amendment. Proceeds—Net proceeds will be used for
expansion of business consisting of airline catering and
restaurant and coffee shop operations. ''/'/■/£/;•//;/£/
unspecified number of shares (no par)
competitive bidding.
Probable bidders include Morgan
Stanley & Co.; Lehman Brothers; Shields & Co.; Harriman Ripley & Co. and The First Boston Corp. (jointly).
Price by amendment. Sale Postponed—The company on
Memphis, Tenn.
($1 par) common. Underwriter—Emanuel, Deetjen & Co., New York. Price—By
Sept. 27 filed
of
?
Drayer-Hanson, Inc., Los Angeles
Aug. 12 filed 80,529 shares ($1 par) class A stock, con¬
vertible into common stock (par $1).
Underwriters—
Maxwell, Marshall & Co., Los Angeles. Price—To public
$10.25 a share.
Proceeds—Net proceeds, estimated at
$694,761; will be used to pay off loans and accounts pay¬
able.
Offering temporarily postponed.
Dumont
Electric Corp.,
-
New York
f
Dumont Electric Corp., and 69,Co., a limited partnership.
000 shares by Dumont Electric
Price by. amendment.
/ '•
reorganization financing.
'•
,
%
Films Inc., New York
(10/28-31)
filed 100,000 shares ($5 par) class A stock and
300,000 shares (10 cent par) common stock, of which
200,000 shares reserved for conversion of class A, Each
share of class A stock is initially convertible into 2
shares of common stock. Underwriters—Herrick, Wad-
June 25,
,
dell
& Co.,
Offering—To be offered
Inc., New York.
publicly at $8.10 a unit consisting of one share of class A
stock and one share of common stock.
Proceeds—$201,~
000 for retirement of 2,010 shares ($100 par) preferred
stock at $100 a share; remaining proceeds, together with
other funds, will be used for production of educational;
films.
Florida Frozen Fruits, Inc.
(10/14-15)
Sept. 26 (letter of notification) 75,000 shares ($1 par)
common. Offering price, $3.75 a share.
Underwriters—
Willis E. Burnside & Co., New York, and Florida Securi¬
ties
Co., St.* Petersburg, Fla.
land, buildings, machinery
of loan and other expenses.
Food
Fair Stores,
Proceeds for purchase of
and equipment, repayment
,\ /
'
/ /
„
Inc., Philadelphia
par) cumulative preferred
Co. Price by
be used to redeem 15-year
Aug. 5 filed 60,000 shares ($15
(10/15-16);
Aug. 29 filed 94,000 shares of common stock (par 10c).
Underwriter — First
Colony - Corp.
Offering — 25,000
shares being offered by
^
'
£ scribed shares will be sold to underwriters. Price by
amendment.
Proceeds—To be added to general funds.
■
ment and
Proceeds—To increase capital so
expand operations in the field of develop¬
share.
a
company may
proceeds.
July 25 filed 65,347 shares (no par) common stock. Un¬
derwriter—Merrill Lynch, Pierce, Fenner & Beane, New
York.
Offering—Stock will be offered to stockholders
at rate of one-half share for each share held.-/Unsub-
Los Angeles
Price—$3
Detroit. Price — $5.50
Stock is being sold by six share¬
C. G. McDonald & Co.,
share. Proceeds
holders
/
:Aug. 9 filed 97,363 shares ($25 par) 4%% convertible
preferred stock and 150,000 shares (50c par) common.
Underwriter—Lester & Co., Los Angeles.
Price—$25 a
share of preferred and $9 a share of common.
Proceeds
—
Proceeds—Net proceeds from the
stock.
Underwriters—Eastman, Dillon &
amendment.
Proceeds—To
3%% sinking fund debentures,
ulative preferred at
to working
capital.
due 1959; and $2.50 cum¬
$53 a share.
Balance will be added
Temporarily postponed.
Volume 164
1
Foreman
Number 4532
THE COMMERCIAL & FINANCIAL CHRONICLE
Fabrics
Corp., New York '!
July 29 filed 110,000 shares ($1 par) common
stock, all
outstanding. Underwriters—Cohu & Torrey. ' Price by
amendment. Offering date indefinite.
Gulf
fered to present Shareholders at
$3 per share.
approximately 200,000 shares have agreed to waive
their preemptive rights.
Offering date indefinite.
Hammond
use
ties
■
approximately $402,000 toward
((■}, /
Inc., Los Angeles
June
27 filed 100,000 shares
($1 par)
Underwriters—Van Alstyne, Noel &
common
stock.
Co., New York, and
Johnston, Lemon & Co., Washington, D. C. Offering—
To be offered to the
public at $8 a share.
Proceeds—
Company is selling 60,000 shares and stockholders are
selling 40,000 shares.
The company will use its
proceeds
| to pay the costs of opening additional stores and to ex¬
Offering temporarily postponed.
Frest! Pry Foods, Inc., Columbia, S. C.
pand merchandise in its existing
Under¬
porarily postponed.
Banks, Inc. Offering—Of the total
is selling 350,000 shares and two
stockholders,
M.
T
,
stores.. Offering tem¬
,
,,
»
,
-
.•
•
,
shares of cumulative convertible
preferred stock ($25 par). Underwriters—W. C.
Langley
| & Co. and Aronson, Hall & Co. Price by amendment.
f JProceeds~+-To pay cost pf acquisition, construction and
equipment of new plant, " and for working capital;- In¬
definitely postponed.'
Glen Industries Inc., Milwaukee, Wis.
July 31 filed 50,000 shares Of $1.25 cumulative converti¬
ble preferred stock series A
($20 par) and 150,000 shares
(10c par) common, all issued and
outstanding and being
sold; by eight selling stockholders. Underwriters—Van
Alstyne Noel & Co. Price by amendment. Proceeds—
To selling stockholders, Offering temporarily postponed,
>
Glencair Mining Co.
Ltd., Toronto, Can.
Oct. 2 filed 300,000 shares
($1 par) stock. UnderwriterMark Daniels & Co., Toronto. Price—40
cents a share
(Canadian Funds). Proceeds—For - mine
*
CJct,
v
Glensder Textile Corp., New York
Aug. 28 filed 355,000 shares ($1 par)
common, of which
55,000 shares are reserved for issuance upon the exer¬
cise
of
stock
purchase warrants.
Underwriter
Van
Alstyne, Noel & Co. Offering—The 300,000 shares are
( issued and outstanding and
being sold for the account
of certain stockholders.
Company has also issued 55,000
stock purchase
warrants, to the selling stockholders at
10 cents a share
entitling them to purchase up to Aug. 1,
—
1949,
common stock of the
company at $11 a share. Price
by amendment. Offering temporarily
postponed.
V•
'
*
'V
-
•-
*•
V\
h-S'-"'.W.v
v.
vvw
-
'
-
Proceeds—Company
is
selling 120,000 shares and 90,000 shares are
being sold
>by shareholders. Company will use proceeds for
expan¬
sion and modernization
work, establishment of new
xttail departments and to
replenish working capital.
'
Grand Canyon-Boulder Dam
Tours, Inc., Boulder
(lett^/plmqtific^tiQn)
-
are to
be leased to individuals.
Holt (Henry V & Co., Inc., New York
June 28,1946 filed 20,000 shares of 4*/2% ($25
par) cumu*
preferred stock and 33,884 shares
($1 par) common stock. Undrewriters—Otis & Co., Cleve¬
land, Ohio. Offering—Company is selling the preferred
shares and stockholders are
selling the common shares.
Price—$25 a share of preferred. Price' for the common
by amendment. Proceeds—Net proceeds will be added
to general funds. Offering date indefinite.
-lative
Illinois Power
writing—There will be
no
underwriting but Everett
Underwriters—By competitive bidding. Probable bid¬
include Blyth &*Co., Inc. and Mellon Securities
ders
Corp.
(jointly) and Morgan Stanley & Co. and W. E.
Hutton & Co. (jointly). Proceeds—Net
proceeds from the
ceeds from the sale of
I <
Sept.. 3
converted
The
12,000
a
—
&
shares
($1
$14
to
to
the. redemption
treasury funds.
International Dress Co., Inc., New York
Aug. 28* filed 140,000 shares of common stock (par $1).
Underwriter—Otis & Co. Offering—Price $10
per share.
Proceeds—Selling stockholders will receive proceeds.
Offering date indefinite.
Jacobs
$5,125
and
for
reserved
(Irvin)
&
Co., Chicago
(letter of notification)
sale
share of
to
one
common.
certain
officers
share of Class A
3,000 units
are
and
employees of
Underwriter—Hill, Thompson & Co., Inc.,
the company.
Proceeds—For payment of indebtedness and
working capital.
Leader
Enterprises, Inc., New York (10/14-15)]
Sept. 26 (letter of notification) 150,000 shares of (100
par) common and 57,000 shares ($5 par) 6% cumulative
convertible preferred, Series A. Price—10 cents a com*
mon share
and $5 a preferred share. Underwriter—
Gearhart & Co., Inc., New York. Proceeds—To replace
working capital used to promote new publication called
Trades
capital.
and
to
provide
additional
working
■
Lime Cola
Co.,
Inc.,
Montgomery
June 28, 1946 filed 225,000 shares (10 cent par)
common
stock.
Underwriters—Newburger and Hano, Philadel¬
phia, and Gearhart & Co., Inc., New York. Price—$5.50
a share.
Proceeds—Working capital, etc. Offering tem¬
porarily postponed.
Macco
Sept.
25
Corp,, Clearwater, Calif,
filed
Underwriter
By
100,000
—
shares
Dean Witter *&
amendment.
Proceeds
—
($1 par) capital stock.
Co., Los Angeles. PriceTo pay off outstanding
bank loans.
Mada Yellowknife Gold
June 7
Mines, Ltd., Toronto
filed
250,000 shares of capital stock (par 40c).
Underwriters
Names to be supplied by amendment.
Offering—Stock will be offered publicly in the U. S. at
40c a share (Canadian money).;
Proceeds—Proceeds,
estimated at $75,000, ^will be used in operation of the
Business—Exploring
company.
developing
gold
,-Maine
June
25
Public
filed
Service
150,000
Co., Preque Isle, Me.
shares
($10
par) capital stock.
through competitive
bidding.
Probable bidders include The First Boston
Corp.; Kidder, Peabody & Co., and Blyth & Co., Inc.
(jointly); Harriman Ripley & Co; Coffin & Burr and
Merrill Lynch, Pierce, Fenner &* Beane. Proceeds—The
shares
are
be
determined
being sold by Consolidated Electric and Gas
Co., parent of Maine Public Service, in compliance with
geographic integration provisions of the Public Utility
Holding Company Act.
ceeds go to
11 shareholders who
are
selling the stock
being registered. Offering temporarily postponed.
2,500 shares of $4.50
Jenseh Manufacturing Co., Chicago
and
mining properties.
Y
Mica Mountain
Mines,
Inc., Salt Lake City
Sept. 11 (letter of notification) 171,000 shares of common
for company, and 22,937 shares to be reoffered in the
alternative for
/
unit consisting of
a
one-half
May McEwen Kaiser Co., Burlington, N. C.
Aug. 22 filed 175,418 shares ($1 par) common stock.
Underwriters—Goldman, Sachs & Co., and Hemphill,
Noyes & Co. Price—By amendment. Proceeds—Net pro¬
key
Offering—Price of preferred, $100 a share.
No underwriting.
To increasing working capital.
•£
*
-
July 24 filed 148,176 shares ($1 par) common stock, Underwriter-^Doyle, O'Connor & Co., Chicago.
Price,
$8.87 V2 a share.
Proceeds—Shares are being sold by
two stockholders. Offering
temporarily postponed.
an
oversale of
offering covered by letter
of notification filed Jan. 2, 1946. Offering price, 171,000
shares — 25 cents each; 22,937 shares — 20 cents each.
Underwriting, for the 171,000 shares only—Howard R.
Clinger and O. M. Lyman, both of Salt Lake City. To,
finance operations until production returns begin.
.
share.
Murphy
of issued and out¬
Prices, preferred $100 a share; com-/
Proceeds—To retire $6 cumulative
preferred, pay notes,
porarily postponed.
discharge
-
a
loan.
Offering tem¬
(Mich.)
Vegetable
3
to retire
York
Graham, Jr., 100,000 shares
common.
a
prior
added
■
scription to
For improvement
purchase warrants entitling registered holders
of shares
of the $4.25 preferred to
purchase at any time
64,750
shares of common stock at $16 a share at the
ratio of 3^
common shares for each
preferred share held; and
120,000 shares pf $1
par common stock.
Underwriters—H.
M. Byllesby and
Co., Inc.
Offering—Underwriters to
purchase from the company 18,500 shares of
preferred
and 20,000 shares of
common; and from Fred P.
mon
be
Michigan Gas % Elec. Co., Ashland, Wis.
Parchment; Co*
par)
common
Jime 24 filed $3,500,000 of series A first mortgage bonds,
due 1976; 14,000 shares ($100 par) cumulative preferred
stock*
Offering — For sub¬
stockholders in the ratio of one
share for /each five shares held, v
Price—$15 a share.
Proceeds—Proceeds, estimated at $1,500,000, will be used
Co., Inc., St.V
a
stock and 120,000 shares ($10 par) common stock; Un* *
derwriters—To be determined by competitive bidding.
Probable bidders include Blyth & Co., Inc.; Kidder, Pea-
common
$500,000 short-term bank loan, to make loans
Ltd., a subsidiary, and to increase work¬
to The KVP Co.
July 29 filed 18,500 shares at $4.25 cumulative
preferred
stock ($100
par), with non-detachable common stock
standing
will
filed 100,000 shares ($10
Underwriting—-No underwriting.
Offering indefinitely postponed.
Grolier Society, Inc., New
and J. C.
common
balance
Kalamazoo
Underwriters—Kalman
share.
Proceeds
modernization program.
I
into
common
Company has asked the SEC to defer .action on its fi*
nancing program because of present market conditions,
Sept.
(letter of notification)
Price—$25
stock
,
Griggs, Cooper & Co.,
common.
Company. Offering
—Price
Underwriters—To
will be applied for re¬
cumulative convertible preferred stock
demption of 5%
not
com*
Net pro¬
employees.
will be offered to the
public and. the remaining
136,500
shares will be reserved for
issuance partly In paymentof an indebtedness.
Partly as a commission to the
selling •;
agents and partly on exercise of
options. Price—$5 a *
share. Proceeds—For
refinancing of company and for
working capital and funds for development and
tion program.
,
be used to reimburse the
pany's treasury for construction expenditures.
cumulative preferred. The
company also intends to offer
an
aggregate of 400 shares of common to a few
N.
on
—
Co., Decatur, III,
sale of preferred will
con¬
(10c par) com¬
behalf of the company and 19,000 shares of
($4
par) Class A and 9,500 shares of the common on behalf
of Carl C. Langevin, President of the
mon
convertible
June *17, filed 200,000 shares v($5Q
par) cumulative pre*
ferred[ stock and 966,870 shares (nonpar) common stock.
•
Crosby, President and James Manoil,
Treasurer, will act
as selling agents.
Offering—Of the total 500,000 shares
Langevin Co. Inc., New York
No underwrite
Western
Sept. 30
Sept. 3 filed 636,500 shares ($5 par)
capital stock.Under-
•
Oct. 3 (letter of
notification) 39,000 shares ($4 par)
vertible Class A stock and 19,500 shares
Fashion
1,015 shares pf common
ip the form of an
city which will include restaurants, bars,
cafes, gambling halls, beauty parlors, etc., all of which
old
.
date.
Goldrf ng Inc., New York
Sept. 27 filed 210,000 shares (100 par) common.
Under¬
writer—Merrill Lynch,
Pierce, Fenner & Beane, New
York.
Price—By amendment.
.
2
($10 par), Offering—Price $10 a share.
big. To build ai^wusement tesort
development.
1
Hell, Inc., Las Vegas, Nev,
Underwriter—Keane &
Offering—Price $2.50 a share.
Proceeds
quantities.
Hayes Manufacturing Corp., Gr. Rapids, Mlclu
are
benefit of issuer.
Co., Detroit.
Feb. 27 filed 185,000 shares of
Shares
"
July 26 filed 115,000
for
common
New York,
*
•"
common stock ($2 par).
being sold by certain stockholders.
Stock
acquired by selling stockhplders in exchange for
432,000
tional storage facilities, "research and development work"
7 shares of common stock (par $3) of American Engineer¬
quel .working capital?:,/ «
J- -•'/ ing Co.
Underwriter—By amendment. Offering—Price by
¥
amendment,
General Bronze Corp., L. I. City
*
Lake State
to increase
Rolahd E. Fulmer and Louis H.
Newkirk, Jr., are selling
the remaining
100,000 shares. Price—$6 a share. Proceeds
—For purchase of sweet
potatoes,, plant expansion, addi¬
-
for other corporate purposes.
or
Under¬
common,
manufacturing plant in Chicago; bal¬
capital. Offering temporarily post¬
■ Z:■,;v \ /
Hartfield Stores,
share for investment. Underwriter — Van
Alstyne, Noel & Co., New York. Proceeds—Shares are
being sold by Ivens Sherr, President and A. I. Sherr,
Executive
Vice-President, who will receive proceeds.
company
Manufacturing Co., East Palestine, 0<
(letter of notification) 5,000 shares (no par) com¬
mon.
Offering—Price $10 a share.
No underwriting.
For expansion and improvement of
manufacturing facili¬
for working capital to enable issuer to
produce its prod¬
uct, an automatic dishwashing machine in commercial
It also will
poned.
per
common.
Kenmar
Products, Inc., Jackson, Mich. ;
Aug. 27 (letter of notification) 100,000 shares ($1 par)
the purchase of a
ance
for working
Warrants for 30,000 shares of
capital stock; to be sold to
underwriter at 10c per share warrant and 5,000 shares
of capital stock to be
purchased by Milton Gluckman at
(100 par)
•
Oct. 2
dends.
Fownes Brothers &
Co., Inc., N. Y. (10/14-17)
Aug. 6 filed 100,000 shares ($1 par) capital stock and
Aug. 30 filed 450,000 shares
writer— Newkirk &
Co., Chicago
($1 par)
Chicago Title & Trust Co., a stockholder. No,under¬
writing. For expansion of building and plant facilities.
writer: Paul H. Davies &
Co., Chicago. < Price by amend¬
ment.
Proceeds—Net proceeds will be used to redeem
its outstanding 6% cumulative
preferred stock at an
estimated cost of $213,258, exclusive of
accrued divi¬
-
7
Instrument
Aug. 8 filed 80,000 shares
Proceeds—Approximately
$1,060,950 for redemption of class A preferred; balance
for expansion, working
capital, etc. Dividend rate and
price by amendment, Offering temporarily postponed.
$9.50
Holders
of
Foster & Kleiser
Co., San Francisco
July 29 filed 100,000 shares of $1.25 cumulative convertible preferred stock
(par $25). Underwriter—Blyth
6 Co., Inc. Offering:—Underwriters
are making exchange
offer to holders of Class A
preferred on share for share
basis plus a cash adjustment.
v
AtlanticTransports Co., Jacksonville, Fia.
Jan. 17 filed 270,000 shares of common stock
(par $l)f
Underwriters—Blair & Co.
Offering—Stock is being of¬
1839f
ing capital.
Kaman
;
Oct.
class
7
-
-
Aircraft
(letter
A
-
of
common
-
<
Corp., West Hartford,
notification)
and
'
-
10,000
20,000
shares
shares
(no
par)
-
•
Conn,
(no
par)
class B
common.
•
Offering price, $10 a share. No underwriting.
To pay operating and research
expenses in connection
with the development of aircraft of
all types.
!
/;•
Kane County Title Co.,
Geneva, III.
Sept. 25 (letter of notification) 4,000 shares of common.
Offering—To be offered to stockholders of record Oct. 4
for subscription at
$30 a share at the rate of one share
for each two shares held.
Subscription rights terminate
Nov. 3. Any unsubscribed shares will be
purchased by
;
body & Co.; The First Boston Corp.; Harris, Hall & Co.
(Inc.); Merrill Lynch, Pierce, Fenner & Beane, and Ira
Haupt & Co. Offering—New preferred will be offered
on a share for share exchange basis to holders of its
outstanding 7% prior lien, $6 no-par prior lien, 6%
preferred and $6 (no par) preferred.
Of the common
stock being registered, company is selling 4Q.000 shares,
Middle West is selling 57,226 shares and Halsey, Stuart
& Co. Inc., New York, is selling 22,774 shares.
Proceeds
—Michigan will use net proceeds from bonds to redeem
$3,500,000 3%% series A first mortgage bonds, due 1972,
at 106.75 and interest.
Net proceeds from sale of com¬
mon and from shares of new preferred not issued in ex¬
change will be used to redeem $375,000 31^ % serial de¬
bentures, due 1951, at 101.2 and interest.
It also will
redeem at 105 and accrued dividends all unexchanged
shares of prior lien and preferred stocks.
—+;
nortft
1 adm
-,'■).
^v!;;-;.
"TT
.17:0±0f§^0Me
'/;V;
J''
-
.;■ ''■■*,
.,.,i
.'1J-.'.1 i'.I,':
..-.MM,
,:■
■'.
THE COMMERCIAL & FINANCIAL CHRONICLE
(Continued from page 1839)r
•—
,
.....
.
;.
j-XX-(KXi
Underwriters—Names by amendment. Offering—Shares
issued
and outstanding
and are being sold by
Maurice
Cohen
and
Samuel
Friedman,
President
Michigan Steel Casting Co., Detroit
27
filed
100,000
—$10
'
Morrison-Knudsen Co.,
Offering—Bonds and
July 22 filed 249,550 shares ($10 par) common and 70,000
of ($50 par) 4Vz% cumulative convertible pre¬
ferred.
Underwriter—Blyth & Co., Inc., and Wegener
Daly, Inc.
Proceeds—Selling stockholders are of¬
fering 149,550 shares of the common and will receive
of
proceeds from these shares.
The company's proceeds,
together with funds to be provided from the sale of
$2,000,000 of 3Y2% debentures, due 1961, will be used to
retire its certificates of indebtedness, outstanding pre¬
ferred stock and a portion of its bank loans.
It also will
use the funds for investment in preferred stocks of sub¬
sidiaries. Price—Preferred, $50 per share; common, $16/
per share. Offering temporarily postponed.
Bids
&
-..'i.v:'a-..-.
v i
-v... •
Mountain
V
June 6 filed
Aug.
are
filed
29
70,000
shares
issued and
par)
($2
&
Co.
(George)
Price—^$16
Kansas
Sept. 25 filed 41,327 shares ($25 par) 5% cumul. par¬
ticipating preferred and 40,000 shares ($1 par) common.
Underwriters
Brothers & Co., Kan¬
sas City.
Offering — Preferred and 20,000 shares of
common
will
be offered
publicly. Remaining 20,000
shares common will be offered to officers and key em¬
ployees at $4.75 each. Price—Preferred $25 per share
and common $5.75 per share. Proceeds—Of shares of¬
fered to public. 6,500 share of preferred and 20,000 shares
'
in
York;
finance
to
and to increase
Murphy
proposed
a
working capital.
(G. C.)
be
sold
to
Probable
Palmetto
1
'
share
-
Pro-
bidders
standing and are being sold by stockholders.
rily postponed.
ance
an unspecified number
($2.50 par) com¬
shares. Underwriters—First Boston
Corp., New York,
and Lee Higginson
amend¬
ment. Proceeds—The stock is issued and
outstanding and
i$: being sold by shareholders., Names of the selling
stockholders and the number of shares to be sold
by each
will be supplied by amendment.
selling
Associated Telephone Co.
this fall.
i
common.
To
Offering—Price $1
purchase
a
% interest in land
a
located
in
La
share.
[ funds previously expended.
^existence of gas and oil in commercial quantities,
.
r
National Manufacture and Stores
Corp., Atlanta :
June 12
stock.
Evans
National Mines & Metals Corp.,
Oct.
,
.
Seattle, Wash.
(letter of notification) 2,500 production deben¬
50,000 shares (5c par) capital stock.
Offering
—Price $100 each debenture. A bonus of 100 shares
capi¬
For exploration, development and equip¬
as corporation elects.
"'■■■
! :
\
*■*
ment to be used
„
Bala, Pa.
••
(10/12)]
(letter of notification) $200,000 20-year amortiz¬
ing serial 2Vz% notes; $200,000 20-year discount-amortiz¬
ing notes; $200,000 20-year discount notes, and $200,000
certificates of interest.
No underwriters. Proceeds will
be used to reduction of principal of outstanding $90,000 /
Oct.
7
mortgage; capital
Ltd., Honolulu, Hawaii
Sept. 27 (letter of notification) 36,000 shares ($20 par),,
common.
Offering price, $20 a share. No underwriter. v
For partial payment of construction of new village for
employees of company, and roads and utilities appur¬
tenant thereto, or for partial payment of bank loans
incurred for purpose of paying such construction costs.
■.
improvements, etc., $60,000; additional
r;S."y'
Phillips & Benjamin Co., Waterbury, Conn.
Sept. 23
common.
Orange-Crush de Cuba, S. A., Havana, Cuba
July 22 filed 75,000 Shares of $1.50 par common. * Under*
'writers-Elder; - Whedler & * Co? Offering—Price $8 * a
share.,, Proceeds—Of the total company is selling;25*000
shares and stockholders
company
will
use
date indefinite.v'
selling 50,000 shares, .r The
its proceeds for equipment. Offering
'f.
'« ;• ;; \
are
.
V/
(letter of notification) 14,164 shares of $5 par
Offering—To be offered for subscription to
present stockholders on the basis of one share for each
share held. Price not disclosed although it is stated that
company
tal stock will accompany each production debenture. No
Newburgh Steel Co.* Inc., Detroit
Corp., New York. Price—By amend¬
^
.
working capital, $50,000.
3
Aug. 2 filed 30,000 shares of 6% 'cumulative convertible
preferred (par $10), and 30,000 common shares ($1 par).
filed 140,900 shares ($5 par) common. The
being sold by three stockholders. Underwriter
T
Olokele Sugar Co.,
tures and
underwriting.
are
ment.
&
Co., Inc. Proceeds—For redemp¬
tion of outstanding $2.50 class A non-cumulative stock.
Postponed indefinitely.
f.X : ■;
'
-■
19
V—The First Boston
(letter of notification) 8,500 shares of common
price, $35 a share.
Underwriters-
Offering
Clement A.
•
shares
replace
tires and tubes and tire repair
Phiiadelphia Country Club,
•
Old Town Ribbon & Carbon Co. Inc., Brooklyn
Sept.
of
materials.
-r
,
^
Proceeds—For payment of loans and to
ness—Manufacture
$937,518 in retirement of its 6% cumulative preferred
owned by General and to reimburse its treasury for
Flore
.
working capital expended in purchase of building from
RFC and to complete construction of a building. Busi¬
.
County, Okla., and in drilling five wells to determine
„
Sept. 27 filed 100,000 shares ($20 par) cumulative con¬
preferred. Underwriter—Van Alstyne, Noel &
Co. and G. L. Ohrstrom & Co., New York. Price—$20 a >/
will be use to redeem its $1,770,000 of 3^% first
mortgage bonds, due 1970, at 1071/2%; to repay $1,450,000 in bank loans; to pay General Telephone Corp.
82,000 shares ($1 par)
share;- No underwriting.
;,
Pharis Tire & Rubber Co., Newark, O.
vertible
.
notification)
equipment.
other
Inc., El Paso, III.
Sept. 30 (letter of notification) 1,750 shares ($100 par)
preferred.
Offering—Price $100 a share.
No under¬
writing.
To replace capital for previous expenditures
and to finance 1946 crop of seed corn to be harvested
pany
of
and
Pfister Associated Growers,
•
14,000 are being sold by General Telephone Corp. Price
—By amendment. Proceeds—Net proceeds to the com¬
Corp., Colorado Springs,
Ltd., Montreal,; Canada
machinery
drilling
purchase
Sept. 11 filed $3,250,000 of first mortgage bonds, 2ys%
series, due 1976; and 35,000 shares (no par) $2 cumulative
preferred. Underwriters — Paine, Webber, Jackson &
Curtis and Stone & Webster Securities, both of New
York. Offering—Of the preferred being registered, 21,000 are being sold by the company and the remaining
£>ept. 27 filed
Price—By
Peninsular Oil Corp.,
*-
mon
will be applied to make loans to Textileather
Sept. 3 filed 600,000 shares of common (par $1). Under¬
writer—Sabiston Hughes, Ltd., Toronto, Canada. Price—
60 cents a share.
Proceeds—Net proceeds will be used to
The -prof
ceeds from the other 3,000 shares will go to
stockholders/ Offering temporarily postponed.
Tempora¬
•
$197,000 for other corporate purposes.
Ohio
(letter
1
that Van Alstyne,
be one of the underwriters.
Offering—Company is making an exchange offer to
stockholders of Textileather Corp., Toledo,
O.;' The
Pantasote Co., Passaic, N. J.; and Astra Realty Co., New
York, for the purpose of acquiring the controlling in¬
terests of the companies. Pantasote Plastics will offer
three shares of its common, plus % of a share of pre¬
company
$350,200, will be applied as follows: About $111,300 for
of outstanding preferred stock; $41,649 to
purchase 100% of the stock of two affiliates, and bal-,
Spj. National Aluminate Corp., Chicago
,
j
N. J.
and Pantasote for various corporate purposes.: v.;
retirement
Securities Corp., and Bosworth, Chanute, Loughridge &
Co. Price by amendment.
Proceeds—Shares are out¬
2
* V
/
include
June 21 filed 85,000 shares ($1 par) common stock.
Underwriters—Newburger & Hano, and Kobbe, Gearhart
& Co., Inc.
Proceeds—Net pro-:
Price, $6.75 a share.
ceeds to the company from 62,000 shares, estimated at
stock ($100 par), 250,000 shares of common stock
($1
par) and warrants for 28,960 common shares (attached
to preferred stock).
Underwriters—Stone & Webster
Oct.
-,
ferred, for each share of Textileather common. It will
offer two
shares of - its common for one share of
(10/15)
Nugent's National Stores, Inc., New York
Y;XXX'X&X
National Gas & Oil
CoSo.
.
''*
.
Harriman Ripley & Co., Inc.; Lee
June 28 filed 28,960 shares of 4%% cumulative
preferred
®
*
amendment, but it is contemplated
„
Service Co.
v''«
1
i
Noel & Co., New York, may
Unsubscribed shares, will,
Price—By amendment.
*
Sept. 27 filed 60,000 shares ($25 par) 4Vz°fo cumulative
preferred and 1,352,677 shares ($1 par) common. Under¬
writer—Underwriting arrangements will be supplied by
shares
two
1 *
\
Pantasote Plastics Inc., Passaic,
loans; purchase of additional equip-
Public
Washington, D. C.
mated net proceeds of $1,473,000 for purchase of a new
factory near Punta Gorda, Florida, at a cost of about
$951,928. It will set aside $150,000 for research and de¬
velopment purposes and the balance will be used a$
operating capital.
j
'
each
for
Fibre Corp.,
16 filed 4,000,000 shares (100 par) preference
stock. Underwriting—Tellier & Co., New York. Price
50 cents a share. Proceeds—The company will use esti¬
<
writers will offer publicly a maximum of 60,000 shares
Halsey, Stuart' & Co. Inc.;
of preferred and 250,000 shares of common, of which'
Higginson Corp.; A. G.
Becker & Co., Inc., Salomon Brothers & Hutzler, Dick
12,853 shares of preferred and 50,000 shares of common
are to be purchased by the underwriters from the comMerle-Smith, Drexel & Co., Harris Hall & Co. (Inc.)
and Stroud & Co., (jointly). Bids Invited—Bids for the Ipany and the balance (which are part of the shares to be
purchase of the bonds will be received at office of Chase; 'received under the exchange offer) are to be purchased
National Bank N. Y. up to 11:30 a.m.. on Oct. 15.
from selling stockholders. Proceeds — Proceeds to the
*•. '
Chicago.
underwriters.
—
June 28 filed $5,275,000 first mortgage bonds, due 1973,/ / Pantasote common, and 12 shares of its common fof
Underwriters—To be determined by competitive bidding.
each shares of Astra common. It is proposed that under¬
expansion program
Co., McKeesport, Pa.
Corp.,
additional
Northwestern
National Alfalfa Dehydrating & Milling Co.,
4
one
ceedsn-To pay bank
(par $1).
Underwriter—Smith, Barney & Co.
Price by amendraent. Proceeds—Redemption of outstanding 4%% pre¬
ferred stock at $109 a share plus dividends. Indefinitely
iwstponed.
Lamar, Colo.
of
Rights expire Oct. 28.
ment and facilities.
June 13 filed 250,000 shares of common stock
;
ratio
held.
of common are being sold by the company. Proceeds—
Proceeds together with other funds, will be used to pay
off $181,909 balance of note held by Schroder Trust Co.*
New
1946 filed 227,500 shares ($1 par) capital stock.
F. Eberstadt & Co., Inc.
Offering —
August
Public Service Co.
—
Headed by Stern
—
>
poned.
Northwest Airlines, inc. (10/15)
Sept. 19 filed 271,935 shares ($10 par) common. Under¬
writer
Auchincloss, Parker & Redpath, Washington,
D. C.; The First Boston Corp., and Hornblower & Weeks,
New York. Offering—Shares initially will be offered for
subscription to common stockholders of record Oct. 15
City, Mo.
•<
a
Aug. 28 filed maximum of 384,016 shares of common
stock. Underwriters by amendment as shares will be
offered under competitive bidding. Probable bidders in¬
clude Blyth & Co.; Inc.; The First Boston Corp.; Stone 1
& Webster Securities Corp., and Harriman Ripley &
Co., Inc. (jointly). Of the shares registered, 182,667 are
being sold by Midland Realization Co.; 54,426 by Mid¬
land Utilities Co., and 146,923 by Middle West Corp.
<
Co.,
stock.
common
surviving corporation. Offer¬
225,000 shares are outstanding and are being sold by 10
stockholders, and 2,500 shares are being sold by A. L
Marlman to all salaried employees. Indefinitely post¬
outstanding and being sold for the account
Northern Indiana
Sept. 4, but the
Brewing
share, with cash adjustments, for the new pre¬
Blade Co., Inc., New York
Pal
June 28,
Offering—All shares
I
Muehlebach
,
share.
Proceeds—To
selling stockholders.- Indefinitely postponed. *
Sale Postponed—Standard Gas & Electric Co. asked for
%5il
/
-
Sale postponed indefinitely.
12.
Inc.
Portland, Ore-
ing price—To be supplied by. amendment.
Engraving & Mfg. Co.; La Crosse, Wis.
of present holders.
Co., Inc.; Kuhn, Loeb
(jointly); Harriman,
Ripley & Co.; The First Boston Corp. Offering—Shares,
are owned
by Standard Gas & Electric Co. and con¬
stitute 56.39% of the company's outstanding common.
on
Aug.
A
The First Boston
Co.,
ferred stock of Pacific, the
refinancing may be carried out.Si
Underwriter—Cruttenden
Probable bidders include Blyth &
Co. and Smith Barney & Co.
temporarily postponed.
withdrawn
Northern
8c
purchase of the stock
share for
SEC has extended to Nov.
shares. The
which
Blyth
/Underwriters
140,614 shares of common stock (no par).
competitive bidding.
sale has been
common
compromise
the
for
were
Underwriters—To be determined by
bids for the
within
a
purchase of the bonds and the common
stock which were to be received by the company Aug. 13
|g
*r
with
common
new
30 time
v.-/'.■ :iv':=('■;?
Power Co.
States
stock
are being offered in
recapitalization plan
approved by the SEC, on June 24, 1946, which among
other things provides for the elimination of all out¬
standing debentures and preferred and common stocks,
and for the issuance of $22,500,-000 of bonds and 2,300,000
connection
1981.
1,
July 10 filed 100,000 shares ($100 par) preferred stock. Underwriters—By amendment. Probable bidders include
Blyth & Co., Inc., White, Weld & Co. and Smith, Barney &
Co. (jointly); The First Boston Corp., W. C. Langley & Co.;
Harriman Ripley & Co.
Offering—Company proposes to
issue the 100,000 shares of new preferred for the pur¬
pose of refinancing at a lower dividend rate the 67,009
outstanding preferred shares of Pacific and the 47,808
preferred shares of Northern Electric Co., in connection
with the proposed merger of Northwestern into Pacific.
In connection with the merger, the outstanding preferred
stocks of Pacific and Northwestern will be exchanged
Halsey, Stuart & Co. Inc. (bonds
only), Bear, Stearns & Co. (stock only), First Boston
Corp., White, Weld&Co.-Kidder, Peabody & Co. (jointly).
,
June
Probable bidders include
Pacific Power & Light Co.,
Association
Bidders may include
Inc., Boise, Idaho
bonds
Underwriters—-Names by
1st and ref. mtge.
$25,000,000 2%%
due
P
V
*
•k
/
;:f"• •■ ^v<v.■ ;■
194(f
Inc.; Halsey Stuart/& Co.,
Proceeds—To finance part of construction program.
Corp.,
fund Series A bonds, and a maximum of 1,568,980 com¬
mon
shares ($5 par). ; Underwriters—By amendment.
shares
-
Series
yJuly 11 filed $22,500,000 20-year collateral trust sinking
August 19 (letter of notification) 14,000 shares ($10 par)
common stock, offering price $20 a share. Underwriter—
Clany M. Seay, Jackson, Miss, will undertake to obtain
signatures authorizing subscriptions for the stock to
create capital and surplus for operation of business.
Company is to be organized in Mississippi.
,
4 filed
>';■>'
Electric Co.
Pacific Gas &
amendment.
share for the preferred and $6 a share for the
Expected late October or early November, m
New England Gas and Electric
Mississippi Fire, Casualty & Surety Corp.
"
a
common.
„
<r
•
Oct.
and Secretary-Treasurer, respectively, each selling 15,000.,
shares of preferred and 15,000 shares of common. Price
shares ($1 par) common stock.
Underwriters—Cray, McFawn & Co., Detroit. Offering—
To be offered publicly at $8.25 a share. Proceeds—Pur¬
chase additional facilities, expansion, etc. Offering in¬
definitely postponed.
June
■
Thursday, October 10,
; are
care
of
wishes to have available 6,000
shares to take
options which it proposes to give to manage¬
ment, for past services, the
options to run over a period
and six months and provide that the stock
may be purchased at $10 a share within 18 months and r
thereafter and before the expiration of the option, at v
of two years
*-
.
■',',J,:!' ^4. :'-. 4
:
:
1840
., -
,
'
$15 a share. No underwriting. For Sexploitation
business. "l"'""
':"k;* v-
of its '
t
R,
>
■.'»
,
•Volume
%
Number 4532
164
^
,■'
t -
■
-r
•
■
(
*
i
''
i
^
f
1
v
t
v4
*
V'
•
\
"wr
%
THE COMMERCIAL & FINANCIAL CHRONICLE
Plastic Molded Arts, Inc., New
York11/13),^.'
Reynolds Pen Co., Chicago
-
*
7.<
c v
1841
V'-V
,
Solar Manufacturing Corp.
V,
"
Aug. 27 filed 60,000 shares of preferred stock ($10 par)
May 4 filed 400,000 shares of common stock (no par),
and 75,000 shares of common (par 50c). 'Underwriter—
of which 100,000 shares are
being sold by company and
-Herrick, Waddell & Co., Inc.
Offering—Company is
.300,000 v- by ; stockholders.
, Underwriters—Names
by
offering the' preferred stock to the public, while the ^amendment. Offering—Terms by amendment. Proceeds
common is being sold
—Net proceeds to the
by certain stockholders-.,' Pricescompany will be added to working
Preferred, $10 a share; Common, $4 a share.« Proceeds—
capital./
Proceeds from sale of preferred will be used to purchase
'-equipment, pay bank loans, and other corporate purposes.
June 14 filed 80,000
shares of, $1.12%
vertible preferred stock, series A
>V;hRowe Corp., New York
Portis Style
Industries, Inc., Chicago
Sept. 27 filed 110,000 shares ($1 par) common. Under¬
writers—Brailsford & Co., and Shillinglaw, Bolger &
Co., Chicago/Offering—Of the total 100,000 shares will
for their
:
'.foe offered to the public and 10,000 to employees of the
account.
own
date indefinite
,
:
.
,
Price—Price to public $6.50 a share. Price to
employee? $5,525 a share. Proceeds—Shares are being
sold by four, Stockholders of the company who will re¬
proceeds. The registration showed that the
v-y';.•.•;
;
•
.
which
,
<$100
not converted into common stock.
will
be
used
for
additional
Such pro-
manufacturing
working
(
•
(
Soss
Manufacturing Co., Detroit, Mich.
Sept 3 filed 40,000 shares ($25 par) 5% cumulative con¬
vertible preferred.
Underwriter—Ames, Emerich & Co.,
Inc., Chicago. Offering—To be offered to common stock¬
:
^
holders, for subscription at $25
a share in the ratio ,&f
preferred share for each five shares of Common held
unsubscribed shares will be sold to underwriters
at same
price. Price — Public
offering price of unsubscribed
shares by amendment. Proceeds—For
expansion of plant
facilities and for additional
one
changed its authorized capital from 4,000 shares
par) common to 400,000 shares ($1 par). Eachshares of $100 par common was changed into 100 shares | offering and price by amendment. Proceeds—Net proceeds will be used to redeem
of $1 par commop, which exchange was consummated.
company's 5% cumulative
prior preferred stocks and an unspecified amount will be
Sept. 23.^:^^
advanced to Taggart
Corp., a subsidiary,' for "redemption
of its $2.50 cumulative
Portland (Ore.) Transit Copreferred. Both securities are
pany
also
capital. Offering temporarily postponed. :
St. Regis Paper
Co., New York
'
!r
Sept. 27 filed 150,000 shares ($100-par) first preferred.
Underwriter—To be supplied by amendment. Probable
underwriter, White, Weld & Co. Offering—Terms of
com¬
are
ceeds
Offering
v
con¬
Under¬
facilities in the amount of
$600,000; for additional inven¬
tory amounting to $400,000, and for additional
*•
Price, by amendment.
?
•company.
ceive
/■;(-■,
.
$20).
Price by amendment.
Proceeds—Net proceeds will be applied for the
redemp¬
outstanding series A convertible preferred stock
July 29 filed 100,000 shares common stock. Underwriters
7.—Hayden, Stone & Co. Offering—The selling stockhold¬
ers, who include Robert Z. Greene, President, are offer¬
ing the shares to the public through the underwriters,
-
Alstyne, Noel & Co.
tion of
..
i
cumulative
(par
writers—Van
,
working
>
postponed.
.
"
^
capital.
Offering
•
;0^
•
June 14 filed
(as amended)
redeemable
60,000 shares of 5%
cumu¬
In
lative convertible preferred stock
(par $25) and 300,000
shares of common stock, of which
80,000 shares will be
sold to Pacific Associates Inc. at $6 per share, also an
wndertermined number of
of
common
at
$52.50
addition, the
a
•.
share
company
plus accrued dividends.
will apply $2,675,000 of the
Sept. 30
as advances to Alabama
Pulp and Paper Co., of
whose common stock the company owns
25,000 shares.
The balance of proceeds will be used to restore
working
"capital.
shares for conversion
7
(letter of notification)
600,000 shares of
^
com¬
covers a recission for
132,000
sold.
Offering—Price 12V2c a share.
none.
For mining equipment and mine
shares previously
Underwriting,
development.
preferred. Underwriters — First California Co.;
j,,.
Scherck, Richter & Co.; Weeden & Co.; Allen & Co^ and
San-Nap-Pak Mfg. Co. Inc., New York
Rauscher, Pierce & Co. Offering price, preferred $26.50
per share; common, $7.50 per share.
( July 24 filed 80,000 shares ($1 par) common stock.
Un¬
derwriters—Dunne & Co., New York.
Offering—Price
Precision Parts Co. of Ann Arbor, Mich.
by. amendment.
Proceeds—Nat/E. Heit, President and
July 5 filed 75,000 shares 5% cumulative convertible i director, and Harry Preston, board
Chairman, Secretary
and Treasurer, will receive net
preferred stock ($10 par).
Underwriter—Van Alstyne,
proceeds as selling stock¬
Noel & Co. and associates. Price by amendment.
holders. Offering date indefinite.
Pro¬
~
V ' 'V
*'
ceeds—Of the net proceeds, $250,000 will be used to pay !"• 7* ' 1 " V,
3% notes held by National Bank of Detroit, $75,000 to
Sardik Food Products Corp., New York
reimburse treasury for sums spent in acquisition of the;
May 29 filed 175,000 shares of capital stock (no par).
electrical division plant of the company, $30,000 for con¬
Underwriter—George F. Breen, New York. Offering—
struction of space for executive offices in the
economy / Stock will be offered to public at
$14 a share. Of the
baler plant, and the balance will be deposited with
total being offered company is
gen¬ ;
selling 155,000 shares and
eral funds. Offering temporarily postponed.
the remaining 20,000 shares are being sold
by two stock¬
...
Leasing Co. Inc., ;
The notification also
mon.
proceeds
.
South Fork Mining and
Spokane, Wash. (
'
,
.
.
Soya Corp. of America
,
Aug. 28 filed 375,000 shares (par lc) common stock.
Underwriter by amendment.
Proceeds—To repay RFC
loan, to buy Canton Mills, Inc. and for working capital.
Price by amendment.
•
.
.
^
-
Standard
Sept. 6 filed 220,000 shares
ferred
.
holders.
Read (D.
M.) Co., Bridgeport, Conn-
Midland Trust
•
'
ilSi Warren,
'
::
O. (10/15).
and warrants for purchase of
common.
cent
one
a
•
125,000 additional
Offering—Price $1.50 a common share and
warrant.
Underwriters—Frank C. Moore &
Regal Games, Inc., New York
Sept. 27 ((letter of notification) 80,000 shares (250
par)
i
37,100 common stock purchase warrants and
shares subject to such warrants; and
85,500 shares of
issued
to organizers for cash which
may be
integral part of this offering. Offering
price, $1.50 a share of common; one cent a warrant and
the
organizational
shares
whichlatter
were
sold
privately at 25 cents each. Underwriter—W. H. Bell &
Co., Inc., Boston. Proceeds—For machinery and equip¬
ment, sales offices and working capital.
an
Republic Aviation Corp., Farmingdale,
Oct.
9
filed
100,000 shares
ferred stock.
($50 par)
N- Y-
convertible
pre¬
Underwriters—Hayden, Stone
& Co., and
amendment.
Pro¬
(Kidder, Peabody & Co.
Price—By
ceeds—Proceeds, together with bank loans, will be used
to increase working capital.
Such funds are deemed
necessary in view of the additional facilities that com¬
pany intends to acquire and its large
backlog of peace¬
>
time business.
filed $500,000 of 3Y2% notes, due
1966; 2,500
shares of 3%% preferred stock
(par $100) and 15,000
shares of common stock (no
par).
Underwriting — No
underwriting.
Offering—The securities being
registered
include notes, preferred and common
previously sold to
private subscribers for an aggregate price of $464,384.
The company is offering to repurchase these
securities
with interest and reoffer them to the
public.
The pur¬
pose of the recission offer is because the earlier secur¬
ities were not registered with the SEC.
Price—The notes
will be sold at 100, the preferred at
$100
will
be
at 10 cents
added to
a
share.
Proceeds
general corporate funds.
a
share, and
—
Proceeds
r
Republic Pictures Corp., New York
Registration originally filed July 31 covered
,
i
/
Scripto,
184,821
unexchanged
(
•
steep Rock Iron Mines Ltd., Ontario
the
general
funds
and
Stern & Stern
will
be
available
for
lanta.
Inc., At¬
share; price of com¬
Proceeds—Company is selling
Price of preferred $10.75 per
mon, $5,625 per
the 25,000 shares
share.
of preferred
$10 a share and stockholders
the
underwriters
the
to
underwriters
at
selling 244,000 shares
share.
The registration
are
at
$5 a
of the 244,000 shares of common are
a period of four days
following the
effective date of the registration for sale to
employees,
that 24,000
being reserved for
officers and directors at $5 a share.
The company also
is selling 200,000 stock purchase warrants to executives
of the company at 50 cents a warrant.
Company will
use its proceeds for
general corporate
purposes.
date indefinite.
Offering
,
common
stock
Price by amendment.
Proceeds—Proceeds from
the sale of 51,000 shares
by the company, will be used to
reimburse treasury for funds spent on June 26 to retire
ing 140,000 issued and outstanding shares.
Company is
offering 100,000 shares. Price by amendment. Proceeds
—From company's 100,000 shares
proceeds will be used
for
outstanding bank loans and commercial
other
corporate
1
i'
reasons.
1
.
"
t
7 ;?7 Stix,
Aug. 28
>
i
paper
Offering temporarily
postponed.
•
rl
,tV; V"'1
par.
Offering tem¬
Y
,
J
'
•'
i1
•
'
I
*5
;
,"
Baer & Fuller Co., St. Louis
filed
102,759
shares
stock
(par $5).
Offering—Eight
selling stockholders are disposing of 62,000 shares, and
the company will offer 40,759 shares initially to its pre¬
ferred and common stockholders.
Price by amendment
Proceeds—Net proceeds from the sale of the company's
Underwriter—Goldman, Sachs
common
&
Co.
shares will be added to its "building construction and
improvement fund." Offering date indefinite.
Street & Smith
Publications, Inc.
July 17 filed 197,500 shares of common stock.
Under¬
writers—Glore, Forgan & Co.
Offering—The offering
represents a part of the holdings of the present stock¬
holders. Indefinitely postponed.
Swern
(par $1).
((7^((
shares.
Co., Washington, D. C.
Underwriters—Van Alstyne, Noel &
Co., and Johnston,
Lemon & Co.
Offering—Certain stockholders are sell¬
to reduce
Textiles, Inc., New York
,
common stock ($1
pax).
Underwriter—Carl M. Loeb, Rhoades & Co.
OfferingCompany is offering 51,000 shares and selling stock¬
holders are disposing of 140,000 issued* and
outstanding
porarily' postponed.
common
general
v
Aug. 29 filed 191,000 shares of
.
ble preferred stock and 244,000 shares ($1 par)
Underwriters—Clement A. Evans & Co.,
stock.
;
-
of capital stock
5,000 shares of preferred stock, $100
Inc., Atlanta, Ga.
Aug. 7 filed 25,000 shares ($10 par) 5% cumul. converti¬
&
Co., Trenton, N. J.
Aug. 28 filed 195,000. shares
common
stock (par $1).
Underwriter—C. K. Pistell & Co., Inc.
Offering—Com¬
is selling 45,000 shares, and eight selling stock¬
are
disposing of the remaining 150,000 shares.
Price—$10.50 a share.
Proceeds—From 45,000 shares
sold by company will be applied to working capital
pany
holders
initially.
,
-
:
.
r
,
•
Taylor-Graves^ Inc., Saybrook, Conn. 7
July 12 (letter of notification) 44,300 shares of ($5 par)
Seco
Sept. 23
common
date
of
Signal Corp., Baltimore, Md.
(letter of notification) 120,000 shares ($1 par)
and $40,000 of 6%
bonds, due one year from
issue.
shares of
shares of $1 cumulative convertible
preferred ($10 par)
and 277,23.* shares .'50c par) common
stock, with Sterling,
Grace & Co. as underwriters.
Company has decided to
issue 454,465 shares of common stock
only, which will be
Offered for subscription to stockholders nf record
Sept.
5 to the extent of one share
ipr each five held. Issue will
not be underwrivten.
By amendment.
proceeds from any
Underwriters—Otis & Co.
amendment.
Proceeds—Net proceeds will be added to
'
•
(
net
use
the
(par $1).
Offering—Price to public by
.
and
to
March 27 filed 500.000 shares
i'fA-'TStf. J,"
;
to
v.
Co., Washington, D. C.
Seaboard Finance
6
common
(B. F.)
Aug. 29 filed 240,000 shares of
Conn.
the
;
to reimburse it for the money advanced In the purchase
of the notes..
/X xn> 7.-"
Business—Production of airplanes.
Republic Foil & Metal Mills, Inc.,
Banbury*
Sept.
$125,000 of promissory
(letter of Notification) $1,950 of promissory
by Mary B. Plant, Washington, D. C. Offer¬
ing price not stated, but presumably at face amount. The
money for the note originally was advanced to the'
issuer by the B. F. Saul Co. which will use the proceeds
y
Company will
—
sold
public to redeem all
shares of old preferred at
$110 a share. •
Co., Washington
30
stated
*
shares
notes made
common;
common
Proceeds
corporate purposes. Offering date indefinite,
' Saul
Sept.
Co., New York; and Euler & Co., Philadelphia. For pay¬
ment of plant
mortgage, purchase of additional equip¬
ment and for working capital.
considered
ed
a
ferred at the rate of 1 l/10th shares of new
preferred for
each share of old preferred.
Price —
issuer.
Aug. 16 (letter of notification) 199,000 shares (50c par)
common
(B. F.)
public offering price of the new preferred is
share, holders of the old preferred will be grant¬
the opportunity to
exchange their stock for new pre¬
$100
*
(letter of notification)
cumulative pre¬
Read & Co. Inc.
event the
by the Stear Mark Corp. • Offering price not
stated, but presumably at face, The money for the notes
was advanced to the issuer by the 3. F* Saul Co. which is
bffering the; notes for sale,/forr its own account.. The
proceeds will reimburse it Idr money advanced to the
Co., New York, Business—Operation of
v
4
(no par)
Underwriters—Dillon,
Blyth & Co.
Offering — Offering is subject to an
offer of exchange to holders of
company's 200,000 out¬
standing shares of $4.50 cumulative preferred. In the
notes made
department store.
Red Rock Bottling Co. of Yoiingstown-
Saul
Oct.
'
stock.
and
Proceeds—Working capital, purchase equip*
ment and plant, etc,
Sept. 27 filed 100,000 shares (250 par) common. Under¬
writer—Van Alstyne, Noel & Co., New York. PriceBy amendment. Proceeds—Estimated net proceeds of
$476,362 will be used to pay off a loan from the Marine;
Brands, Inc., New York
Offering price, $100
common
a
unit.
The
120,000
will be given as a bonus to the
pur¬
on the basis of 300 common shares
chasers of the bonds
for each $100 bond.
Underwriting—Light, Wofsey & Co.,
Baltimore. For organization of business.
•
Six
Nations Baseball
& Amusement
Oct. 3
preferred and 75 cents
a
—Amos Treat & Co.
Proceeds—For payment of notes,
Club,
Inc.,
(letter of notification) 826 shares (no par) com¬
capital. 1 Offering—Price $25 a share.
No under¬
writing.
For purchase of equipment, busses for trans¬
portation of supplies and personnel and other items.
share for common. Underwriter
mortgages and for general corporate
temporarily postponed.- j -L
Tele-Tone
Aug. 1
cents).
Flushing, N. Y.
mon
cumulative convertible preferred stock and 44,300 shares
stock (par 50c).
Offering—Price $6 a share for
common
Radio
purposes.
Offering
'J
~
Corp., New York
filed .210,000 shares of common stock (par 50
Underwriters—Hirsch & Co.
Offering—Com¬
is offering 75,000 of the shares registered.
Eleven
are selling
135.000 issued and outstanding
shares, for their own account.- Offering—Price $6.75 a
pany
stockholders
share.
Options—Selling stockholders
are
also selling to
options to
the underwriters at 7 cents per option warrant
7(7-(Continued
on page
1842)
convertible
preferred stock, ($10 par). Underwriters—Newburger
& Hano; Kobbe, Gearhart & Co., Inc., and D. Gleich Co.
July 3 filed 90,000 shares of 5% cumulative
shares of the issued and outstanding
They are also selling to Hallgarten & Co., for $1,500, plus $360 as a contribution
toward the expenses of issuance, options to purchase an
additional 18,000 shares of the issued and outstanding
common.
Proceeds—Net proceeds for the sale of com¬
pany's 75,000 shares will be used for increasing working
capital, with a view to entering the Frequency Modula¬
tion and Television fields at an advantageous time. Of¬
fering date postponed.
'.OV1
'
purchase 18,000
common owned
Transue &
•
by them.
Williams
Steel Forging Corp.,
•L Wheeler, Osgood Co., Tacoma, Wash,
certain dealers,
included, at the
public offering price, less certain concessions. Price $10
per share. Proceeds—It is presently
anticipated that
$437,500 will be used to acquire the capital stock of Wil¬
liams Stores, Inc., and Levitt. Millinery Co.
The bal¬
Oct. 7 filed 80,000 shares
regulated that the gross proceeds
Oct.
filed 50,000 shares
7
writing
—
None. Price
—
$625,000 4% bonds and $638,600 first and second deben¬
tures; balance -for working capital.
Business—Manufacr ture of house and
garage doors.
*" * - ■
»
White's Auto Stores, Inc.
^I
will not ex¬
amendment.
and by shareholders.
The respective
hi
supplied by amendments Price by:
Proceeds—Company will Use about $210,-
000 Of its net
proceeds to redeem* 645 shares of its prior V
the
company
amounts
will
be
added to general corporate
($10 par) common. Under¬
$30 a share/Proceeds — The
Weetamoe
Corp., Nashua, N. H.
Well, Marshall & Co., Los Angeles.
automobile insurance business.
Cincinnati, Ohio
United States Shoe Corp.,
one
Winters: A
Mich.-
Light Co., Escanaba,
r'^
5,500 shares of 4Y4% first
July 18 (letter of notification)
preferred stock series B ($50 par). Offering price, $50
a share.
Underwriter—First of Michigan Corp., Detroit.
Proceeds—For enlargements and improvements of power
'
plant facilities.
/,
'
sales
contract
Proceeds—To retire a cdftditiotial
by the; Reconstruction
bmik loans of $600,000, and fot
obligation held
Finance Corp., pay off
to Nashua Manufacturing Co.
changed
Price; by amendment.
prior to
incorporated June 27,
operating properties and certain
working capital.
effective date of registration) was
holders, who will receive the, entire net proceeds.
Price by amendment. Offering date indefinite.
/ ,
Upper Michigan Power &
!
share of preferred and one-half share of convertible.
be
Crampton Corp., Grandvilie, Mich.
Company is initially offering the stock to its common
holders at the rate of one share for each two shares held.
Offering—The pre¬
Price by amendment. Proceedsr—Weetamoe Corp. (Name
to
wholly-bwned subWhite's Em¬
Aug. 58 filed 119,337 shares of common stock (par $1).
Underwriter—E. H. Rollins & Sons, Inc.
Offering-—
"
ferred and convertible stocks will be offered in units of
Aug. 25 filed 24,000 shares ($4 par) common. Under¬
writer—Benj. D. Bartlett & Co., Cincinnati. OfferingShares will be offered to the piiblic by seven stock¬
Price by artiertdmeht.
account.
•
and 650,000 shares ($1 par) common stock. Underwriters
—Blair & Co., Inc., Reynolds & Co., New York and Max-
fire, marine and
own
ployees Profit Sharing Trust, and for additional working
capital. Offering date indefinite.
$995,000 as surplus. Business—Company was incorpor¬
ated in Nebraska Sept. 20, 1946 and intends to engage in
the
dividuals for their
sidiary, retire loans from banks and from
July 15 filed 200,000 shares ($25 par) $1.20 cumulative
pfd. stock, 100,000 shares of ($1 par) convertible stock
constitute the
.
will be used to provide funds fo* a
funds,
stated that $500,000 of the $1,495,000 proceeds
capital of the company^ and after
deducting $5,000 estimated expenses, it will classify
company
will
»
29
Proceeds—Proceeds from the sale of the preferred stofck
preference stock at $110 a share and accrued dividends,
and 1,386 shares of second preference; stock at< $100 a
share and accrued dividends. ;; The
balance will be m¬
Omaha, Neb.
(10/28.31)
filed 75,000 shares $1 cumulative convertible
preferred stock ($23 par) and 50,000 shares common
stock (par $1). . Underwriters—First Colony ,Corp. and
Childs, Jeffries & Thorndike, Inc,
Offering-^-Company
is. offering 75,000 shares of preferred^ the 50,000- shares
of common are outstanding and being sold by four in¬
Aug.
Sept. 3 filed an unspecified number of shares of. coin-stock (par $1).
Underwriting—Loewi & Co;;: Mil¬
Offering—The shares are being* sold both by
*
United Benefit Fire Insurance Co.,
•
—
*"
waukee.
$100,000. The selling stockholder will authorize the
Market Street National Bank, Philadelphia, where secu¬
rities are pledged as collateral security, to sell, from
time to time, through their brokers on the New York
/
r
($5 par) 50c cumulative conpreferred stock and 100,000 shates ($1 par)
commons Underwriter
Names by amendment. Price "
by amendment. Proceeds—Will be * used to redeem
vertible
v
mon
ceed
Stock Exchange.
purposes.
£•;
Wis. :; J, JI
Webster Electric Co., Racine,
(letter of notification) the number of shares to
be sold on behalf of John C. Redmond* Vice-President
and Director will be determined by market price and
so
be applied to general corporate
temporarily postponed,....
Will
ance
Offering
^
2
will be
account and the
..
Offering—Underwriters propose to offer the shares in
part to the public and the balance to
among whom any underwriter may be
Alliance, Ohio
Oct.
shares for its own
remaining 20,000 shares are being sold
by Allen & Co., New York, with Shea as underwriter.
Proceeds—Shea & Co. is selling 26,400
Virginia Dare Stores Corp., N. Y.
(Continued from page 1841)
Thursday, October 10, 1946
CHRONICLE
THE COMMERCIAL & FINANCIAL
1842
1946
to
bther
.
acquire
assets
of
the
Nashua
Wisconsin Power & Light
Manufacturing Co. which was
incorporated in 1823.: The new company was organized
at the instance of Textron, Inc., and is wholly-owned
subsidiary, Textron Mills, Inc., which ate promoters of
the new company. Net proceeds, together with $2,300,000
representing the proceeds from the sale of 50,000 shares
of convertible stock to the underwriters and 525,000
.
y
share,
approximately $13,000,000 for
shares of convertible stock to Textron, Inc., at $4 a
will be used
as
follows:
Co.f Madi&bn, Wis.*
May 21 filed 650,000 shares ($10 par) common stock to
be
sold
at: competitive
bidding.
Underwriters—By
amendment.
Probable bidders include Merrill Lynch,
Pierce, Fenner & Beane; White, Weld & Co.: Glore,*
Forgan & Co., and Harriman Ripley & Co. (jointly);
The Wisconsin Co., and Dillon, Read & Co.
Proceeds—
Part of the shares are to be sold by Middle West Corp.,
top holding company of the System, and part by pref¬
erence stockholders of North West Utilities Co., parent
payment of a portion of the purchase price Of the assets
of Wisconsin, who elect to sell such shares of Wisconsin
Portland, Ore.
to be acquired from the old company, about $100,000 for
common which Will be distributed to them upon the:
Oct. 4 filed 14,000 shares ($100 par 2% cumulative Class
organization expenses, and about $1,100,000 for working
dissolution of North West Utilities Co.
A preferred and 2,000 shares ($100 par) 2% cumulative
capital. Registration may be withdrawn.
Class B preferred. Underwriters — None. Offering —
*,rx.* */
',r' '* '
*
"
1 y''*
ir*
/' !'
/
Stocks will be offered for sale to customers and former
Yolande Corp.* New York
s ^ 'j ^
Westinghouse Electric Corp.<
customers of the Herbert A. Templetoh Lumber CP. with
Sept. 17 filed 50,000 shares ($i par) common stock.
Aug, 14 filed 1,647,037 shares ($12.50 par) common.
whom the registrant has an exclusive sales contract
Underwriters—Headed by E. F. Gillespie & Co., and in¬
Underwriter—Kuhn, Loeb & Co. Offering—Stock.will be
whereby all the lumber produced by the registrant will
cludes. Childs, Jeffries & Thorndike, Inc., New York;,
be sold to Templeton.
Price—$100 a share for each class ■ offered for subscription to holders of outstanding pre¬
Courts & Co., Atlanta; Irving Rice & Cd., St. Pall!, and
ferred stock and common stock in ratio of Vs share for
of stock.
Proceeds—Company was organized last Sept.Maxwell, Marshall & Co., Los Angeles and New York.
each share of common or preferred held. Unsubscribed
19 for the purpose of acquiring certain properties owned
Proceeds—Estimated net proceeds
shares will be sold to underwriters. Price—By amend¬ | Price—$10 a share.
by Cobbs and Mitchell Co. and W. W. Mitchell Co. and
of $400,000, together with $87,125 from the sale of 10,250
ment. Proceeds—To reduce bank lodns. Offering fern-;
to purchase 80% or more of the capital stock of Valley
additional common shares to J. William Anchell.-Viceporarily postponed.
'
and Siletz RR. Proceeds will be used to make part of
President, at $8.50 a share, will be used partly for the
the down payment on the property and to fut-nish work¬
West Coast Airlines, Inc., Seattle, Wash.
purchase of 10,995 shares of capital stock of 'Island
ing capital.
Business—Operation of lumber manufac¬ r
:
Needlework, Inc., of Puerto Rico, out of a total of 11,000
turing plant.
'
•.
»
f.
' - Sept. 2 filed 245,000 shares ($1 par) common. Under¬
outstanding shares. The. shares will be purchased for.a
writer — Auchincloss, Parker & Redpath, Washington,
total price of $220,522 from Mrs. Gertrude S. Korsh, sister
D. C. Price—$7 a share. Proceeds—Will be used for pay¬
Velvet Freeze, Inc.
of Herbert L. Miskend, President and Treasurer of
ment of various expenses, repayment of bank loans,
July 24 filed 203,509 shares of stock which are to be sold
purchase of equipment and for working capital. Business / Yolande Corp. Of the remaining proceeds, $68,750, plus
for the account of certain stockholders.
Underwriters—
Valsetz Lumber Co.,
•
•
Sherck, Richter & Co., and Straus & Blosser. Offering—
Of the total, 200,000 shares will be sold through the
underwriting • group at $8.50 a share, and 3,500 shares
will be offered to certain employees at $7.50 a share.
Offering postponed indefinitely.
■
.
,
r.
| dividends, will be used to redeem at $110 a share the
company's 625 shares of $100 par 6% cumulative pre¬
—Air transportation.
W£$t Virginia Water Service Co.
ferred
Aug, 6 filed 46,400 shares (no par) common, tinderwriter—Shea & Co., Boston.
Price, by amendment.
stock.
The
balance
will
be
used
to
reimburse
company's treasury for previous expenditure and for
additional working capital.
^
11
the
Prospective Security Offerings
•
(NOT YET IN REGISTRATION)
PREVIOUS ISSUE
INDICATES ADDITIONS SINCE
[EDITOR'S NOTE—Due to the paper situation, we are limiting
coverage of "prospective" financing in this issue to only those
Undertakings which have come to hand during the past week, thus
omitting the items of this nature which can be reported in previous
issues.
We regret the necessity for this action and will resume the
usual complete tabulation as early as circumstances permit.]
our
American & Foreign Power Co., Inc.
•
gether with cash funds of the Company would be
preferred stock issues. :
Oct. 3 substitute plan filed with SEC by group known
as
the Norman Johnson group in recapitalizing com¬
securities would provide for the issuance of
$35,000,000 3% sinking fund debentures and $80,000,000
•
used
to retire old
pany's
4%
convertible debentures, the proceeds of which to¬
American
Progressive Health
Insur. Co., N. Y.
for
60,000 shares 35c participating preferred stock, to be
Sept. 4 expected filing by notification at early date
offered
at
$5 jper share With B. & Clahtof & to, as
underwriter.
©
*
Edison Co. Of
Consolidated
July 3
company
New York,. Inc.
<
formally submitted to the New York
Public Service Commission its plan to issue $290,000,000
of
new
mortgage
-
bonds as part of a plan to
redeem
$304,240,000. of callable mortgage bonds and debentures
and $15,869,000 of non-callable mortgage bonds due in
1948 and 1949—a total of $320,109,000 of long-term debt.!
United States
Government,
State, Municipal
presented to the Commission, and subject to its ap¬
proval, company plans to offer first an issue of $100,000,000
of new refunding'bonds the proceeds of which, together
with temporary bank loans, would be used to retire all
of the company's callable mortgage debt and prepay all
but about $2,800,000 of non-callable debt. A second issue
As
i
First California Company
and
INCORPORATED
Corporate Securities
Underwriters and Distributors
of
Bjlair 6- Co.
INC.
Serve
NEW YORK
BOSTON
BUFFALO
PHILADELPHIA
CHICAGO
PITTSBURGH
Our Sixteen
CLEVELAND
ST. LOUIS
Offices
California and Nevada
Head Office: San Francisco
$100,000,000 would be used to retire
company's debentures and repay a
$65,000,000 of
part of the bank loaris.
$90,000,000 would refund the last of the
debentures and pay off the bank loans. In anticipation of
this refinancing, company has already established a bank
credit of $65,000,000 with a group of New York banks.
Company hopes subject to market conditions, that the
refunding bf the preferred stock would follow, as soon
as feasible, the completion of the .bond refunding. ProbA final issue of
.Volume 164
able
Number 4532
bidders
THE COMMERCIAL & FINANCIAL
CHRONICLE
include
Morgan Stanley & Co.; Halsey;
Stuart & Co. Inc. (bonds
only), and Blyth & Co., Inc. C:
with dividend rate not to exceed
4%.
Proceeds will beused to redeem
outstanding debentures.
Probable un¬
•
derwriters, W. C. Langley & Co. and Union Securities
Consolidated
Oct.
8
Edison Co. of New
York,
stockholders
shares of
authorized-creation
Inc.
of
2,200,000
•
cumulative preferred stock to be .issued in
series. For the purpose of
saving taxes on
one
or
the
authorization of
more
shares, stockholders
new
voted
Oct.
at office
of
G.
J.
Enderlin, Treasurer,
plans
of
to
refund
series of
bonds
is
bonds
expected
Studebaker Corp.
Nov. 20
for the purpose of
•
on
authorizing the issu¬
to 200,000 shares of preferred stock
increasing corporate capital.
Textron, Inc.
Oct. ; 8,
early
consideration
of
financing plans by the
company is expected following the announcement Oct. 7
of the completion of the
transaction by which Gossett
Mills and
Chadwick-Hoskins, the former's
subsidiary,
Southern, Inc. The lat¬
subsidiary of Textron, Inc.,
acquire all of the outstanding stock of Gossett and
have been merged into Textron
was formed last
May as a
ter
to
140
Chadwick-Hoskins, for an amount reported at that time
be about
$12,000,000. The parent company financed
the acquisition in part
by .means of a bank loan. Prob¬
Cedar St., New*.York 6, N. Y.
Interest rate is to be spe¬
cified in the bid.
Probable bidders include. Halsey,
Stuart & Co. Inc. and Salomon Bros. & Hutzleiv
to
able,? underwriter of.
securities, Blair & Co.
(107i5)
Duiuth, Missabe & Iron Range Ry.
Company will receive bids
;"
J'
;
National
>'jj*
York
terest rate. Probable bidders include Morgan
Stanley &
creating
&
Co.;
:
issue of
(par $100),
preferred
this
and
which
'common
and
200,000
Is
common
less along
(almost
of
of
handled.,
in¬
$100
$25
par
more
or
toy
-
the
The
first
large
issue
new
to
reach the market in several weeks,
Pacific
Telephone & Telegraph
Co.'s
$75,000,000
around the
40-year de¬
bentures encountered a ready re¬
sponse when
subscription books
were
financing
a
have
provided
working capital.
welling
in
up
I
priced
at
buyer;
a
a
-r.
\
'<
The quiet spell of the last few
has provided the under¬
2%% .coupon and
attractive
fighting
a
shy
of
insurance
have
been
anything
eral riiqnths.
less
i
2.75 return.
Securities
The
to
which
Commission lost
and
are
as
most of
an
easy
those involved
willing to admit, but it is
going
along and accumulations
ing the
have been
substantially reduced
amendment,
this
action
being
in most directions.
taken midway through Tuesday
According to those who follow
afternoon, instead of late in the
evening as had been the custom the situation. the Allis-Chalmers
preferred has been pretty well
over a long period.
This'suggests
a
disposition
under
the
things
up.
On the basis of the
which
was
cleared away and the same
goes
General Cable Corp.'s issue.
the part of SEC
regime to speed
on
new
winning bid,
102.6199, the net cost
for
There is still some
Willys-Over¬
land around, but here
too, prog¬
ress is
being made.
,
to the company was calculated at
2.77%.
It was the generally ac¬
cepted belief that if the financing
had
been
done
several
months
the company might have
slightly better, perhaps real¬
ized a 2%% coupon. • '
' "
ago,
done
1
But that bidding was close is
apparent from the fact that the
high
bid
represented
differ¬
a
ference
of
Indicative
only
of
overall dif¬
about
$44,093.
demand
which
Coming Up to the Wire
is
moving gradually down to the
starting line.
This week stock¬
holders gave approval to the com¬
mon
stock write-down of
$172,500,000 demanded by the Public
Service
Commission,
and
ap¬
new
new
issue
of
2,200,000
preferred stock.
The company already has
ranged for1 a bank
credit
$65,000,000
to
be
employed
ar¬
of
Yl point
PSC's
or so.
its
approval
debt
of
its
to begin the operation.
yHeinz & Co. Financing
There
that
the
is
little
or
no
,
doubt
offering of H. J. Heinz
only
one
one
If
or
two
and
J.
$140,000,000 of
plants
consoli-. and
new
Bank, due April 15,
1948.
issue originated from all parts of
the country arid that subscriptions
received from
country banks were
exceptionally heavy.
.
stock, $100 par value at $102.75'a share and 200,000 shares of
stock, $25 par value, at $41 a share.
Heinz
II,
taxep have made it most
and inventories."
"The sale of stock," Mr. Heinz
added,
"will
mean
no
change
whatever in the present manage¬
company."
Company sales have increased
the
last
five
from
$71,900,304 to $114,150,564. During this
period
same
years
income
net
increased from $3,922,484 to $4,680,892. The
company has
paid a cash dividend on its com¬
in
every
$100,000,000
each
and
a
third
Tracy, Calif.,
Ont., and the
Watsonville, Calif. Foreign
of
the
plants
each
one
and
two
in
company; op¬
in
Canada
and
England, Australia
Spain. 1
In the United States
the com¬
pany has 75 sales branches and
60 warehouses located in
cities. Sales
about
this
principal
directly to
made
are
200,000 grocery accounts in
country.
v
.
;
DIVIDEND NOTICES
the preceding fiscal
year, which¬
ever is lower.
,
Since
H.
J.
Heinz
II
president in 1941, the company
has spent $14,988,000 for additions
to
plants and equipment. New
ASSISTANT
COLUMBIA
GAS
became
since
year
&
:
ELECTRIC
CORPORATION
The
declared this
Board
TRADER WANTED
of
Directors
has
day the following dividend:
Common
Stock
No. 46, 10$ per share
payable
November 15, 1946, to holders
of record at close of
business October 19,
on
1946.
Over The Counter Firm
Dalb Parker
October 3,1946
Secretary
Looking For
ASSISTANT TRADER
CONSOLIDATED
Salary and Commission
>
Basis
NATURAL GAS
COMPANY
Box CO-10; Commercial &
Financial
30 * Rockefeller
Plaza
New York 20, N. Y.
Chronicle
Dividend No. 6
25 Park PI., New York
8, N. Y.
'The
board
of
directors
has
ing, $5,150,000 will be used to
deem
this day declared the fol¬
lowing dividends on the capital
103%
of
re¬
SITUATION WANTED
stock of the
on
the
company's outstanding
4% cumulative preferred stock at
value plus accrued
dividends. Balance of the proceeds
par
will be added to
working capital.
After the current
financing,
100,000
1,409,064
shares
of
common
For the
new
redemption of the
preferred stock, a sinking
fund
has
been
an
000
established; which
1,
1947,
calls
for
annual amount equal to
$200,-
the consolidated net
earn¬
or
ings after preferred dividends for
Company, payable
November 15, 1946, to stock¬
holders of record at the close of
business October
Over The Counter
15, 1946:
Regular semi-annual cash divi¬
dend
of
501
per
share;
share.
Checks will be mailed.
Twenty
'
ence.
Making
this market.
make
101
change.
N. Y.
money
; "
October 4, 1946
in
* Box
&
W
Fi¬
Chronicle,
25
Place, New York 8,
•
/,
DuVALL, Secretary
Desires to
Commercial
nancial
Park
E. E.
experi¬
years
and
Extra cash dividend of 50$ per
Trader Available
cap¬
italization will consist of
shares of preferred and
beginning Oct.
:
'■
Pittsburgh and Chambersburg, Pa.; Fremont and Bowling
Green, .Ohio; Salem, N.
J.; Me¬
dina, N. Y.; Winchester, Va.; Hol¬
land, Mich.; Mathews, Ind.; Mus¬
catine, la.; Berkeley, Tracy, Isle-
'Of the proceeds of this financ¬
program
This will involve three
steps,
two
involving new issues of
•
built at
were
Wallaceburg,
after
taxes has
stock
to Oct. 15.'
up
common
earn¬
ings to finance expansion of fac¬
tory 'facilities^ warehouse space
in
Divi¬
cbriipany's^
difficult to retain sufficient
ment and control of the
three
bought plants at Charle¬
voix, Mich., and Mathews, Ind.
;
Principal Heinz plants are lo¬
•
on the
financing, H. J.
all
company
ton and
Heinz
Commenting
or
cated at
He reports that demand for the
Co.,* Pittsburgh, 77-year-old manufacturer of the
"57 Varieties" of food products is
making its first public offering
of stock. A group of 62 underwriters headed
by Morgan Stanley &
Co. is offering 100,000 shares of Heinz
3.65% cumulative
public
series
include Salomon Bros, and Hutzler
and Halsey, .Stuart
&' Co., Inc. Bids will be received
Preferred-Common Stocks
H.
outstanding
now
three
bids. Probable bidders
dated 134% bonds of the Federal
readjustment
the
less the successful bidder desires
separate issues.
dend rate is to be specified in the
the
Loan
of
single bid for all three; series is accepted
series designated Series K will be
issued un- '
a
Morgan Stanley Group Offers H. J. Heinz Co.
stock.
refinancing
premium
any
together.
subsidiaries
in
presumably is only awaiting the
a
for
ported heavy oversubscription of
Home
$2,740,000
equipment trust certificates ($485,000 Series
K, $685,000
Series L and $1,570,000 Series
M).
Bids will be accepted
erate
of
greeted the offering the deben¬
quoted at
debt
a
Western Maryland Ry.
(10/15) S'ih
Company will receive bids for the purchase of
re¬
Everett Smith, Fiscal Agent for
banks in New York, has re¬
mon
Consolidated Edison Co. of New
York's huge
refinancing program
tures
are
J
■
a
ence of only about 58.8 cents a * proved
shares of
thousand over the second bid
of 102.55991, or an
about $5
the
creased
The task hasn't been
one,
Exchange
time in clear¬
customary post-effective
no
...
T
s
the
fraternity with a much President, said "until the present
needed opportunity to
push the time it has been possible to pro¬
job of "mopping up" on the rem¬ vide for the company'? steady ex¬
nants
of various
issues, mostly pansion program through earnings
equities, which had backed up and short-term bank loans. During
rather badly over a period of sev¬ recent
years, however, greatly in-f
to maturity, the issue was con¬
sidered
at
writing
10314 to return the
yield of about 2.74%
companies
the
Inc.
,
preferred
>v,
weeks
Carrying
than
t'\
•?
»
Home Loan Bank Bonds
Septem¬
Mopping Up Campaign *
'^4
;'
their
hands.
*
of
arid the balance will be added to
portion of the funds which
been
middle
redemption of its outstanding
4% cumulative preferred stock
large institutional, investors their
first opportunity in some time to
place
until
Some $5,150,000 of the
proceeds
be applied
by the company
opened.
$90,000,000,
Waitt & Bond,
Nov. 29 stockholders will vote on
a recapitalization
plan
which would eliminate arrears
of dividends on the Class
A shares, and also
provide company with additional
equity capital for expansion. The plan calls for the
con¬
solidation of Waitt & Bond Inc. with
the Waitt & Bond
Co., a wholly owned subsidiary.
Capitalization of the
new
corporation would consist of
110,000 authorized
shares of $2 cumulative
preferred ($30 par), 600,000
shares ($1 par) common and
100,000 stock purchase war-,
rants. The plan involves a
public offering of new pre¬
ferred. The company has been
negotiating with Reynolds
& Co., which has indicated it
will underwrite
50,480
shares of new
preferred, subject to market conditions at
$30 a share.
1 ;;
•
f
•
•
■
•
registration
to
this
involves
will
"An entirely new money under¬
taking,
in
'
^
has been completed.
ber.
of
%
heavy since the issues
placed
were
f
No preferred stock will be is¬
sued
under¬
writing group, it was indicated
that inquiries coming to dealers
:
v.
private lines, that is
wholly
has been
>
maining
outstanding
at
that
time, and also to liquidate the
the aforementioned bank loans.
preferred stock
shares
\
latter to pay off debentures
prove a
operation,
100,000 shares
cumulative
par
?
'
^
decided success.
Although
''•*
publicly 4,000,000 of the class A shares
shares, offered today;, will
volving
•'
gating 5,500,000 shares, each with $1 par value. Of the
total, 4,500,000 will consist of class A and the remaining
1,000,000 shares will be class B.^ It is planned to offer
a new
35,000 shares of cumulative preferred stock
\
it
'*
rear-engine Tucker Torpedo automobile. Financing
plans involve the setting up of two issues of stock aggre¬
•; Goodall-Sanford, Inc.
on
*»
/
^
new
Co. and Halsey Stuart & Co. Inc.
Oct. 29 stockholders will vote
*
v
i
1
Tucker Corp., Chicago
Oct. 2 the corporation announced that
arrangements for
offering $20,000,000 in common stock, probably at $5 a
share, had been completed with Floyd D. Cerf Co.,
Inc.,)
Chicago, as underwriter, to finance production of the
up
Bank, New
in
•
•
to Oct. 15 (noon) care of
for purchase of $19,200,000 1st mtge; serial bonds to be dated Oct. 1, 1946,
due $1,200,000 annually Oct. 1, 1947-62. No bids for lessthan 98 y2 will be received the bidder to specify the in¬
First
The
remaining 500,000 shares of class A will be
the
corporation treasury.
All the 1,000,000
class B shares will be taken
by Mr. Tucker and officers
and founders of the Tucker
Corp.
The class A shares
will have an initial
preference of 50 cents a share as
to dividends.
Any dividends above 50 cents a share
will be divided
equally between the class 'A and class B
shares.
The two classes of stock will
have equal voting
rights.
It is said a group of about 300
securities dealers
will participate in the
public offering within two and
one-half or three months.
held
•
stockholders will vote
and sale of up
ance
EST Oct. 22
Room 2008,
issue
new
it
new
a
share.
.
Delaware Lackawanna & Western RR*i (10722
Company will receive bids for the purchase of $4,250,000
noon
The
•
will be sold either on competitive
issued in voluntary or underwritten exchange
cumulative preferred stock or a combination
thereof. Probable bidders include Morgan Stanley & Co.
to 12
bonds through
serial notes.
through competitive bidding. Registration ex¬
pected about Oct. 25;"-Probable bidders: Lee
Higginson
Corp,; Blyth. & Co., Inc.; Halsey,. Stuart & Co., Inc. !
or
up
Corp.
that
to be sold
for the $5
equipment trust certificates
announced
company
and
preferred
new
bidding
4
$19,131,000 4V2%
to
reclassify 811,110 shares of old preferred stock and 1,388,890 shares of common stock, authorized but unissued,
into the 2,200,000 shares of new
preferred.
Company
plans to issue approximately 2,000,000 shares of the new
preferred at not less than $100 a share.
The precise
method of refinancing the
present $5 preferred stock
and of issuing new shares of preferred has not been
determined and will depend on market conditions pre¬
vailing at the time of issue. These steps would be under¬
taken after completion of
$290,000,000 bond refunding.
The
Safe Harbor Water Power
new
Co.
1843
$3
The
TIIE UNITED CORPORATION
CUMULATIVE PREFERENCE STOCK
{
Board of Directors of the United Cor¬
poration has declared a dividend of 75c per
share, accrued at October 1, 1946 upon the
outstanding $3
Cumulative
Preference
Stock,
payable October
18,
1946
to the holders
of
record at the close of business October
11, 1946,
THOMAS
Wilmington, Delaware
October
2,
1946
H.
STACY, Secretary.
■"
THE
COMMERCIAL & FINANCIAL
in the entire history
Believe Events of
Next Few Months Will Determine Stock Trend
Some Wall Street Bankers
1782)
(Continued from page
of
prices
commodities
consumer
the stock market
will drop again
spring to a point even
next
at
-fallen
factors
Two
lower
which it has
the present time.
to
level
the
than
despite certain na¬
tional differences and ideologies,
they would endeavor to effect a
settlement of> .the issues : before
the world that,
as
seen
are
dominant influences
the
affecting cur¬
lysts are agreed on this point. The
effects of strikes on the economy
considered by them as a
deal
the
sets
economy,
the
the
some
last war, he
Germans in the
in the stock
Current weakness
keeping
the general volume of
trade and employment.
Part of
the prevailing low productivity of
labor, they hold, is undoubtedly
due to the artificial shortage of
$n
Some of the low
strikes.
,
fact
the
that—as one
ceilings to
that some workmen are re¬
ceiving, for instance, he points
out,
the war has been
does not yet
exist in the world, notably on the
continent of Europe. According to
•;t^i^fi>anker, though war may not
breap out with Russia there will
wholly disproportionate
are
getting.
equilibrium
in the price structure, he thinks.
The election is seen as another
disturbing influence. One broker
thinks a Republican victory in No¬
probably be a succession of inter¬
vember would tend to reverse the
national crises that will retard
present downward trend of the
any return to normalcy in busi¬
market.
•,
••
ness, f
In some quarters on Wall Street
Though talk about, impending
it is felt that investors are domi¬
war has subsided somewhat, some
nated too much by the thought of
sections of Wall Street still think
the inevitability of a stock crash.
that the danger of war is as great
Remembering 1929, for instance,
now as it was a few weeks ago.
investors
are
inclined to think
The recent speeches of Stalin and
that a decline in stock prices is
Byrnes on war and the rumors of
something that - must be faced
war were disappointing, according
to one broker who thinks that the eventually, it is pointed out. Some
undercurrent of world action is analysts, however, feel that the
conditions prevailing in the gen¬
arousing the fears of the world
eral business picture today are not
more now than ever. A joint state¬
ment by the leading powers of what they were back in '29. Never
.a
year,
to those
peace
have
been
Some analysts
*
think department
because
and
contents
r
7,
v
1779
page
'7 /v."
'•
■>/•" .',-7'"
7 v.'
I
-i
''"r v'"•
Old
Rails'
of
the
Commons & Pfds.
truck
Two With Lester & Co.
FOREIGN SECURITIES
(Special to The Financial Chronicle)
ANGELES, CALIF. —Je¬
LOS
Miller
and
K,
John
Mac-
M.S.WIEH&CO.
Firm Trading
HA. 2-8780
Teletype N. Y. 1-1397
148 State St.,
•
General Panel Corp.
N.
Co.
S International Resistance
Boston 9, Mass.
7:7 ;,7-.::
7/-./
Tel. CAP. 0425
which others are
•.
7v
/ J
5
Teletype BS 259
:
:
Y. Telephone HAnover
2-7914
Gearhart & Company |
Suburban Elec. Sec.
INCORPORATED
Members New York Security,
philadelphia telephone
telephone
REctor 2-3600
7f;h Enterprise
Bell Teletype
new
6015
york
1-576
C
Worcester Trans. Assoc.
Boston Real Estate
MINING and
77
-
•
Established
BROAD ST., N.Y.
4W§:-'
We
;
1924
328
specialize in all
Industrial Issues
HANOVER 2-4341
:
^ 1
Public Utility Stocks and
Bond#
TEXTILE SECURITIES
Securities with
a
New Eng. Market
Frederick C. Adams & Co.
Specialists in •
•
England Unlisted Securities
,
P.ARL MABKS 4 P.O. INC.
j
•
Hew
Bank — Insurance
SPECIALISTS
Public
■
Established in 1922
Tele. BOston 23
>
New York 4, N. Y.
CHICAGO
■
24 FEDERAL STREET, BOSTON 10
Tel. HANcock 8715
/
AFFILIATE: CARL MARKS & CO. Inc.
Teletype
Hanoyer 2-7913 7 BS
Investment Trnst Issues
1-2866
TELETYPE—N. Y.
New York /
7/;•
Insurance and Bank Stocks
Morris! Stein & Co.
Specializing in XInlisted Securities
si
Boston
Hubbard 6442
'
•
Milk Street, Boston 9, Mass.
31
Bought
Trust
Ralph F. Carr & Co., Inc.
Markets
SECURITIES
Airplane & Marine
-
Schoellkopf, Hutton & Pomeroy
All Issues
FOREIGN
'.
Thompson's Spa Inc.
5
,45 NASSAU STREET, NEW YORK
Rogers Corp.
■7
/
Dealers Association
BRITISH SECURITIES
'
1919
ESTABLISHED
Exchange PI., N. Y. 5
40
Consolidated Industries, Inc.
50
V-
see
V/''''//'-"/.it
'
Ceraseal Chemical Corp.
Teletype—N. Y. 1-971
—
of
index
detailed
For
delivery strike.
rome
There must be more
HAnover 2-0050
50 Broad Street
M
*».
INDEX
,,
■
'»*.♦4'
wages
banker
put it—though
over
H 1
•
prices. One bank economist holds
that prices generally are all out
of kilter at the present time. The
tating to call any strike.
.Mother factor of major impor¬
tant disturbing the stock market
is
spending too
much 7 money/ on
luxuries — too
much in beer parlors and on fur
coats—rather than keeping cash
in their pockets to buy consumer
durables later, he points out. v,/;r;
comes
.
like floors than
more
the best
by hesi¬
would be acting in
interests of labor itself
ers
"<>'
V'V'1
(1935-39=100) reached
an all-time high.
The August fig¬
ure
was ,154%
higher than the
114 figure for the year 1940. Sales
have mounted faster than general
prices as seen in the fact that the
restricted
caused by
produc¬
tivity, however, results from too
much soldiering on the job, too,
they think.
C:J
One broker believes that the
for other markets in which to pur¬
time has come for the government
chase materials vital to their pro¬
to" take effective measures to pre¬
duction, it is seen.
vent strikes in the vital public
Government price controls have
welfare industries, that is, all in¬
also been upsetting the market, it
dustries except those in the defi¬
is felt. In fact, according to one
nitely luxury class, and a bank
banker, OPA prices are becoming
economist argues that labor lead¬
supplies
necessary
.•').»„vd' a."
•
dex at 290
store sales provide a valuable in¬
by'; recent
have become associated
dex of general business conditions. Donald
Treasury debt reductions which
necessitates
many
banks call- Those who follow this view attach with Lester & Co., 621 • South
ing
loans
and ^;the
liqui¬ great significance to the fact that Spring Street, members of the
dation
of security holdings by
the Federal Reserve Bank index Los. Angeles Stock Exchange.
customers. Mergers in which the
large -companies have absorbed
their sources of supplies have al¬
so had a tendency to upset busi¬
Trading
M
ness conditions by disturbing long¬
standing equilibriums in industry,
forcing the other former custom¬
Artkraft Manufacturing Corp.
ers of these supply houses to look
been ;
repercus¬
serious
with
line
sions
of department store sales has been
extremely high. In August, this in¬
history have there
cred¬
it—for buying those goods. Never,
too, has the market been so re¬
stricted in favor of the United
Federal Reserve Bank index for
States/ As f one banker said, "I
the cost of living in August at
can't see how the market can be
143.7 was only 43% .higher than
too bad with all the money there
the 100.2 figure of 1940. Likewise,
is in circulation and the great de¬
ferred
demand that exists for though the cost of living index
goods. Never in
been more means—money or
market, it is also felt, can be at¬
tributed partly to the fact that
the credit base, for the extension
of
bank loans to industry has
vital
parts from the assembly lines in
other industries, they point out,
can
tie up production all along
by
instance,
for
of the world,
pointed out, has there been
such an accumulated demand for
it is
says.
which up¬
they hold.
supply industries,
in the
Strikes
Thursday, October 10, 1946
CHRONICLE"
..
recognize. It is the
aside from the de¬
itself
of the strikers
strike
mands
great
devastating than peo¬
more
ple generally
'/)
.
stock market.
One of these is the disturbed labor
.situation. Practically all the ana¬
are
/:7v/7/7/;/
commonly .ac¬
ceptable basis would change the
situation considerably, he believes.
rose 10% from January to August
goods."
The great need in this country is
this year, the index of department
One observer thinks that the
for a positive instead of a nega¬
store sales
increased 27%. The
tive foreign policy, he holds. Ob¬ "shock" to the economy caused by department store sales index for
the severity of the recent decline
servers of the international scene
September fell slightly to 270 but
shouldn't be misled by the fact in stock prices may prove to be this drop was attributed largely
good thing.
Perhaps people to the decline in the volume of
that the people here do not want a
warsince
people
everywhere needed a jolt of this kind, he be¬ business in the metropolitan New
lieves. People with moderate in¬
never have wanted war, not even
York area
from
them
trends in the
rent
'
''
Utility—Industrial — Real Estate
♦Seaboard Fruit Co., Inc.
♦General Products Corp.
Grinnell
Eastern Industries,
Gerotor-May
Sunshine Consolidated
Pressurelube, Inc.
♦Susquehanna Mills
Inc.
and Common Stocks
Traded
The
Company, is
Automatic
Empire Steel Corp.
a
consolidation ,'of
BOUGHT—SOLD— QUOTED
Signal Corp.
and
*Prospectus
on
request
-
...
Delhi Oil
Eastern
Engineering Co.
W. T. BONN & CO.
120 Broadway
New York 5
Telephone COrtlandt 7-0744
Bell
Teletype NY 1-886
Amos Treat & Co.
40 Wall
St.
BO 9-4613
New York 5,
N. Y.
Tele. NY 1-1448
REITZEL, INC.
REMER, MITCHELL 8c
208 SOUTH
LA SALLE ST., CHICAGO 4
WESTERN UNION TELEPRINTER "WUX" t
•
PHONE RANDOLPH 3736
BELL SYSTEM
TELETYPE CG-989
Hill, Thompson & Co., Inc.
Markets and
120
Situations for Dealers
Broadway, New York 5
Tel. REctor 2-2020
Tele. NY 1-2660
@FedFRASER