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UNIVERSITY
2
ESTABLISHED 1S39
MICHIGAN
OF
1952'
OCT 27
BUSINESS UMINISTUIION
UBKUf
Reg. U. 8. Pat. Office
.Volume 176
Number 5162
New York 7, N. Y.,
Thursday, October 23, 1952
Pride 40 Cents
Copy
a
EDITORIAL
As
Ball Market Is Not Over!
We See It
-
Despite all the shouting and the
tumult, all the
diversionary tactics, all the mendacity, and all
<
distressing vulgarity by which the
political campaign has
on
Asserting there is
•
last summer, it
been very
would,
current
difficult to find
supposed for
moment
a
a
there is
convention
technical evidence
It is again a great
but let
it would be
prac¬
boast of the New Deal and Fair
Deal, or choose
a candidate who
might find a way to avoid en¬
dorsing all this record of "accomplishment" and
make his bid for election this
autumn on the basis
of it
that is, not possible for the
me
such thing with
when the
his
ages
200
came,
there
certain
were
political force of the belief that
for
the
time
not.
to
then
himself seemed at first
impression
three
—
and,
on
and
at
on
was
that
the fear
of
inflation
portance in preventing
in
1937
had
we
financing.
and
profit
appreciable
v
a
stocks
income
traded
had
a
not
a
factor
consecutive
effect
the
on
market
for
another
talk
ON THE INSIDE
—
A glance at the Index
Association
Several
James F.
of
seemed
Hughes
cations
dex
or
page
on
the
the
on
of
the
daily
issues
New York Stock Ex¬
an
unsatisfactory market
covering the next two
to four years.
deficit
year
based
declines
leadership and refused
along with the D-J industrial
go
pointed to
Finally he pointed out that pension fund
sharing fund buying would not have any
by Mr. Ward before
the
Brokers, New York City, Oct. 21, 1952.
26
of
years
on
performance
im¬
decline in stock prices because
seven
index
and
average to new highs in May and
again in September, the technical
probabilities for the long pull turned
definitely adverse. On the basis of
experience with the regulated mar¬
ket
since
1938 * the
probabilities
were
of
advance
its position of
to
a
was
major
change. When this index, after reach¬
ing a high in February 1951, gave up
his
were
taxes
breadth
advances
because the buy¬
Continued
*A
page
up
broad
a
Among these unfavorable technical
relationships the most important has been the action of
first, that the
common
that
such
is well known.
Continued
projection of
influence
definitely under
as
the
foremost.,
back
times
this
year
it
has
though the technical indi¬
supplied by the breadth in¬
as
about to be proved all
wrong. In January the
nearly equalled the September 1951
were
34
industrial average
Continued
Customers'
•A
talk
Brokers,
by Mr. Hughes before the Association
New York City, Oct. 21, 1952.
32
on
page
of
Customer's
011
page 3 vividly shows the wealth of informa¬
tion of vital importance to the
securities field,
investors, and businessmen which is
available in the Thursday "Chronicle"
every week throughout the year.
DEALERS
State and
U. S.
WESTERN
Government,
Stale and
Securities
telephone:
STATE
Pacific Coast &
Municipal
and
Hawaiian Securities
SECURITIES
Coast
Dean Witter
14 Wall
COMPANY
BOND DEPARTMENT
[ENT
Co.
&
Street, New York, N. Y.
and
f
Los
BROKERAGE SERVICE
•
Angeles
•
Chicago
Honolulu
to
the
Government
in
Kenya Colony and Uganda
Head
Office:
26,
Bishopsgate,
London, E. C. 2
for
Banks, Brokers and Dealers
Branches
in India,
Pakistan, Ceylon,
Burma, Aden, Kenya, Tanganyika,
Uganda, Zanzibar, and Somali-
land
Hardy & Co.
Members
Members
30
New
New
Broad
York
Stock
York Curb
St.
Tel. DIgby 4-7800
New
Exchange
Exchange
York 4
Tele. NY 1-733
Bond
Protectorate.
Authorised Capital-.
Paid-up
Reserve
Capital
Fund
£4,562,500
£2,281,250
£3,675,000
The Bank conducts
every
banking
description of
and exchange business.
Trusteeships and Executorships
also undertaken
Bond Department
1915
THE
and
CANADIAN
10
Denver
Spokane
other Western Cities
CANADIAN
SECURITIES
Net
In
Or
On
BONDS & STOCKS
U. S. Markets
Canadian
Orders
Canadian
CANADIAN
NATIONAL
OP THE CITY
Power
DEPARTMENT
Analysis
DoMmoN Securities
Co.
6kporahom
1891
115 BROADWAY
NEW YORK
1
STOCK
NORTH
EXCH.
40
Exchange Place, New York 5, N.Y,
Teletype NY 1-702-3
WHltehall 4-8161
request
Members New
other
111
LA SALLE ST.
CHICAGO
upon
irahaupt &co.
end
MEMBERS NEW YORK
Company
»
Exchanges
ESTABLISHED
YORK
COMMON
Executed
&
BANK
OF NEW
El Paso Electric
Securities
Goodbody
CHASE
NEW YORK CITY
•
Los Angeles
Dept. Teletype: NY 1-708
NATIONAL BANK
of INDIA. LIMITED
Bankers
Coast
Members of All Principal Exchanges
50 BROADWAY
Salt Lake City
•
Boston
STOCK and BOND
ESTABLISHED
OF NEW YORK
Security Exchanges
San Francisco
30 BROAD ST.
to
J.A.H0GLE & CO.
THE NATIONAL CITY BANK
Members of Principal Commodity
A
Bonds
Direct Private Wires
Wires
Chemical
BANK & TRUST
Municipal
OIL & MINING
BONDS
HAnover 2-3700
Direct Private
MUNICIPAL
,
relationships since the spring of 1951 have
justified
.
of the
such
the
4
Redpath
in the stock market,
high level that this
destroyed the buying in¬
centive
of
individuals,
especially
those in higher income tax brackets. The
second point
Kenneth Ward
party responsible for all this and up
the last moment
very boastful of it. Mr. Ste¬
some
and
too^important
gains,
a
change, and who apparently conceived
Stevenson, the reluctant candi¬
date, could go before the people as one able to
supply the change demanded, reshaping and re¬
molding party philosophy, party programs, and
cleaning up the mess in Washington—all in the
venson
Technical
not
ing and Selling of stocks was pritnarily motivated by a desire for capital
had
the idea that Mr.
name
J.
high yields
leaders of that
party who realized what a burden
President Truman was to his
party, who felt the
come
D.
&
ceased. Holds speculative climax in stocks has
already
passed, but forecasts no collapse in stock prices, so that
opportunities may exist for good "trading swings."
were
arguments-he used to
bearish opinion were
time
stock market,
forecasting, like crime,
particularly impressed
reasoning when the aver¬
selling at approximately
with
HUGHES*
F.
Contending, on basis of experience with the regulated
market, probabilities point to lower stock prices in next
two to four years, Mr.
Hughes relies cn a "breadth in¬
dex," which, he say's has been revolutionized by regu¬
lation. Says impact of
professional speculation in keep¬
ing market in well-defined trends, by concentration on
pivotal stocks, cannot be ignored, and this influence has
beginning of bear¬
privilege to discuss the
JAMES
\
.
_
Two years ago it was
my privilege
listen to a very well-known com¬
mentator talk about the stock mar¬
ket.
I
was
hope of
any
'
Members New York Stock Exchange
to
success.
Yet
yet of
as
say at the outset that
Democratic
any
i-
Auchincloss, Parker
does not pay, and nowhere is
the pride of opinion more
expensive than in the stock market.
No one can shoot
par on this course.
tically possible for the Democratic.party to draft
a
platform which did not endorse and indeed
party to do
/
Discusses stock market position of various
groups of stocks, and expresses
opinion that ownership
of stocks should work out
better than holding cash.
guess, have
—
no
ish trend.
corporal's guard who
that
unusual amount of cautiousness and
an
market, Mr. Ward reviews cur¬
rent economic
backgrounds, and on the basis of these, in
spite of bearish predictions, declares himself "a coward¬
ly bull." Sees bull market still not ended, and maintains
too many occasions been
we venture to
By
conservatism in the stock
plagued, certain elementary facts seem to stand
out in
stronger relief in the closing days of the
struggle than at its beginning.
Thirty days before the Democratic
Market Is Bearish
Hayden Stone & Co.,
Members New York Stock
Exchange
,
the
Outlook foi the Stock
By KENNETH WARD*
Broadway, N. Y. 6
WOrth 4-6000
Boston
York Stock Exchange
Principal Exchange*
Teletype NY 1-2708
Telephone:
Enterprise
1820
Thursdp^
T)ie Commercial and Financial
2
-
f;
23, 1952
(1518)
IN
TRADE
participate and give their reasons
for favoring
they to be regarded, as an offer to
Los
don't grow
"Trees
Pacific Power & Light
is
appropriate
of
observer
Puget Sound Power & Light
Utility
New York Hanseatic
n
1949,
gan
in
awfully
1920
their way
of the
Specialists in
decades,
week
or
instruments
pointed out that
iyfcpoNNELL&ro.
120
Slock
Exchange
Tel.
protected by a favoring environ¬
ment, will cause the sapling to
keep on growing
until it gets
pretty well along toward the sky.
It's a much tougher job for in¬
2-7815
REctor
Trading Interest In
knowledge
companies,
be
and
the part of management,
attain heights
beyond
the
ship
Commonwealth Natural Gas
to
trends
trial
Camp Manufacturing
on
also
original concepts pf the
who planted the seed.
Dan River Mills
Life Insurance Co. of Va.
persons
effect
then
and
has
cause)
hints
strong
is
Request
offered
back
go
—
poration
Republic Investment Company, Inc.
putting
been
in
28 Va
at
History
today.
Telecomputing
Cor¬
in
July,
was
organized
4
computing service or¬
ganization. The company owes its
inception in large part to Mr.
Ward
W.
Beman,
President of
Teletype
Telephone
Telecomputing, who, in his former
CG 2197—CG 1614
FRanklin 2-1150
position as Chief Aeronautical Re¬
search Engineer of Lockheed Air¬
Wire
Direct
City,
Mo.
1947,
Securities
LASALLE STREET
to
and
New
York,
Kansas
had
1856
I.
ices
manufac¬
by I. B. M., and it did busi¬
equipment
only
tured
Exchange
Curb
Exchange
customer,
Lockheed Aircraft. Early in 1948,
Exchange
Telecomputing
other
largely
velopment
type
new
Trade
of
Cotton
ness
Inc.
Exchange,
Board
Orleans
And
M.
B.
Cotton
York
York
Chicago
II,
Stock
York
Commodity
New
War
in apply¬
instrumental
ices, used in its computing serv¬
Members
New
World
throughout
equipment to the
solution of engineering problems.
During the first year of its exist¬
ence the company functioned only
as
a
supplier of computing serv¬
H. Hentz & Co.
New
a
been
ing
New
as
craft
Milwaukee, Wise.
Established
V
u
e e
Geotechnical
I.
Exchange
B.
M.
third
Exchanges
with
one
the
began
de¬
of instruments of a
to
supplement
the
equipment,
quarter
of
and
by
the
1948
the
com¬
M.
B.
It
mitments within six months upon
payment to Telecomputing of
minimum
amounts.
While the agreement is open-end
is
to both dollars and duration, it
that
contemplated
phase
until about September,
or
1953.
Telecomputing
mitted
its first
I.
B.
that
its
has
progress
It has
M.
first
extend for at least 15
may
months,
the
reason
progress
has
sub¬
report to
to
believe
been
em¬
inently satisfactory.
and
Shipments
I.
B.
tant
M.
Earnings—The
agreement
string
in
is
an
impor¬
Telecomputing's
bow, but it is not one of the
strings on which the tune of
record-breaking sales and earn¬
being played. While
there has been close cooperation
ings is
now
between the company and
I. B. M.
throughout Telecomputing's brief
the only direct ties are
NEW YORK 4,
N. Y.
at
present,
I
DETROIT
CHICAGO
PITTSBURGH
GENEVA, SWITZERLAND
important
This
maufactured
instrument
and
which followed it, the
0
product.
the
one
Telecorder,
earnings
from
the
development
agreement will remain small for
some
time in
relation to the corn-
All
their
of
together
LAMBORN & CO., Inc.
99
that they
means
inadequate
r
and
N. Y.
5,
SUGAR
Raw
—
Refined
—
Liquid
1#~
a
Futures
Exports—Imports
publicly
of 50,000 shares was
sue
STREET
WALL
NEW YORK
problem is, of course
money
problem
chores,
ao ono
into
offered, of which net proceeds t>
the
There
underwritin*
the
warrants
purchase
stock
exercisable
DIgby 4-2727
were
of
time
the
slightly ovr
also issuer"
were
company
$250,000.
expiring
and
6
at
April 30, 1957. A few thousand of
the warrants have now been ex¬
presumably more will
or certainly the
ercised and
A
Producing, Refining
and Distributing
Company
be in the months
Sioux Oil Co.
immediately
ahead,
but
$270,000 proceeds fro^
exercise, plus retained earn¬
years
even
full
the
ings,
has been. It may
be expected tha4
will
coirmany
try
get
to
rangement
be
—-
.
of
—
Over-the-Counter
manage¬
migh4
forward-looking
is
.
the prob¬
almost be measured by
lems
has.
it
shows
to
let
it
now
have
for
signs
no
the
to
the
If
past
is.
problems
The
?
Quotation Services
for 39 Years
yea1'
management
the
of being
business
is
will
Telecomputing
year,
roll
conten4
along
National Quotation Bureau
Incorporated
as
company's
of fact,
might
Established 1913
func¬
46 Front Street
tion,
as
a
5, N. Y.
Teletype NY 1-2630
two.
Growth
degree to which
ment
HAnover 2-9335
possibility
as a
next year or
Accompaniment
The
67 WALL STREET
NEW YORK
but new financing
regarded
within the
JAMES M. TOOLAN &, CO.
?
plant without diluting the equity
—perhaps by a lease-back ar¬
must
STOCK
Inquiries Invited
the
to
problem if its growth rate is sus¬
tained at anything like what i4
the
COMMON
not be the whole an
company's financia'
may
swer
after
estimated
403 W. 8th ST. LOS ANGELES vTU-5630
entirely owned by the company'?
founders. It was then reclassified
continue
reasonably
a
the
to
(a) Telecomputing's use of I. B. M.
agreement. As closely as can be
first
at
which
criterion,
prototype of the Telereader,
which became the company's
money
they art
than adequate for pres¬
history,
had constructed for its own
Plant space,
—
March, 1951, the stock wac
Until
45,000
as
OF SEASONED COMPANIES
IN SOUTHERN CALIFORNIA
and
The space
pensation
to
Telecomputing
is
plus. The right is reserved to
I. B. M. to cancel any of its com¬
cost
specified
BLOCKS OF
two hence.
related
at
equipment in connection with its
own.
and
(b)
the develonment
a
or
understood that the basis of com¬
the
of
September
before
hopelessly
be
may
is
use
Bldg.
more
no
Telecomputing to begin work
immediately on three develop¬
for I.
Tel. NY 1-1932
to
foregone con¬
quarter
a
buildings.
ent needs,
Telecom-
pany
N. Y. Cotton Exchange
five
small
are
year
projects
Tel. DIgby 9-1550
company's big problems. Al¬
the
for
ment
Assn.
New York 7
in
'
into
scientists.
ago,
Security Dealers
ready the company has spilled ou*
of whom 40 are engineers
,months
Y.
to cope HARRY AND MYRON KUNIN
100% an¬
ji/uvate
en
nually
compounded
rate
have
been
and
probably will remain
Oil
occupies space
five buildings at four locations
Burbank. It employs about 155
and
is
personnel,
and
with
expansion
Telecomputing
persons,
N.
against 12c
and
Growing Pains
Telegraph.
&
4s-1967
150 Broadway
September
both
tory.
Foote Bros.
and
Pacific
Corp.,
Machine,
&
Telephone
in
Members
and after
taxes, will be the highest of any
quarter in Telecomputing's his¬
Aircraft.
Shell
Raytheon,
that
earnings,
Douglas,
,
United
Aviation,
Philco,
Deb.
1951.
of
high
new
a
clusion
Ground, Los
Laboratory.
11
Conv.
GBISTEN & FBENKEL
end
43c
continuing
are
beat August. It
Hughes Aircraft, Glenn L. Martin
American
Aviation.
Re-
Three
out
that direction.
First publicly offered at 5%
in
March, 1951, the one-class equity
to
Chemical Corp.
CHICAGO
set
North
in
after
the
were
1952
first half
Records
California Institute of Technology,
Consolidated
&
of
topple this half. August deliveries
them ' are
Among
half of
first
the
customers
may be.
1, 1952. While full details have
blessed com¬ not been
divulged, it was dis¬
panies. The price performance of closed that the
agreement called
its
common
stock
(we'll
first
mention
SOUTH
the
twice
these
among
Nuclear Instrument &
231
about
from
analysis equipment,
data
TWX LY 77
Investment
earnings
Corporation,
f-uting announced a joint develop¬
five-year-old Burbank, Califor¬ ment
agreement it had entered
nia, manufacturer' of electronic into with I. B.
M., effective June
Lynchburg, Ya.
on
outstanding at
Scientific
Alamos
Gear
Foote Mineral
Com.
four-fold
a
1951,
Proving
Aberdeen
nublic
half
net
and
almost
stock
Telecomputing
STRADER,TAYLOR & CO., Inc.
Circular
they are fortunate
favored by indus¬
superb steward¬
if
enough
Bassett Furniture Industries
too have the
that
some
they
but
vestors,
historic
American Furniture
iLD 39
nourishment and
given the proper
YORK 5
NEW
BROADWAY,
$24,500,
showed
tal
government
fields.
Rgts.
respec¬
first
of
several
eous
the
ove,r
the
of
the
aircraft c ompanies, and
companies in miscellan¬
ing
the
in
recognizes
botanist
stage of development of a
tree that that particular piece of
flora has something in
it that,
Exchange
Curb
almost
100%
and
in
company's
many
&
one.
operated rise, to $38,400 from $10,800. On
exclusively the 90,000 shares of $1 par capi¬
in¬
labora¬
tories and universities, most lead¬
The
clude
early
Members
York
February,
in
worth
would
be
$100,000 today.
1921,
The
International
in
offices
Dow Chemical
Common
modest
a
of
range
branch
could have said that
figures
taxes
$5,000 to $20,000.
Machines
than
tive
against
Prices
data.
advertisement a
invested
$1,000
engineering
Stock"
Business
Since 1917
was
scientific
of
analysis
the
in
two ago,
"Growth
Rights & Scrip
into
towering
& Poor's, in a
grown
statement
more
highly
are
almost
used
devices
Standard
giants.
its incorporation
Actually,
electronically
complex,
three
or
instruments
These
Robert E. Anderson
within
have,
two
out
ground,
our
in
equipment and engages
velopment contracts.
pushing
to
related 1951. Sales were $725,600 vs.
de¬ $314,600, pre-tax net was $88,100
miscellaneous
produces
were
first
wires
unbroken.
sales, pretax net, and net profit in
the first half of 1952 were all far
also
company
Mobile, Ala.
Direct
approximately
of
since
year
The company
Telecordex, Teleplotter and Universal
The
that
•
remained
this
Telereader, Telecorder,
Telereader.
—
each
principal "standard product"
instruments
at
present are vthe
as
NY 1-1d57
La.- Birmingham, Ala.
on
trend
five
recog¬
Exchange
doubling the size of the company
company's
Does—The
New Orleans,
1952
the company's fifth an¬
niversary, Telecomputing s growth
customers.
It
Curb
St., New York 4, N. Y.
Hflnover 2-0700
M. endeavors.
report to stockholders pointed out
that,
York
New
25 Broad
earnings
Telecomputing's first half
indi¬
of
requirements
rising
non-I. B.
its
from
—
ies, in no
they
York 5
Teletype NY 1-583
pur¬
steeply
pany's
York Stock Exchange
Members
modifications
with
cases
What
Sequoia
sprouts when
Curb Exchange
Steiner, Rouse & Co!
Chicago, 111. (Page 25)
Members New
company
meet
compa-
nizable
& Co.,
therefore be¬
their commercial production,
the
vidual
that
to
Late, in
instruments.
the
some
to
wished
work
computing
to
stocks
and
trees
do,
And
way
Corporation
York
sky," it
California
a
that
Sequoias
some
New
adage
nevertheless,
tall.
New
improvement of the first two
the company found
that
several
organizations
for
which
it
had
been performing
to the
for
Gregory, Manager of
Bank Stock Dept., Swift-Henke
completion
the
upon
instruments,
re¬
a
minder
Common
120 Broadway, New
Bought—Sold—Quoted
Bank of Chicago—
National
and
chase
append
get
BArclay 7-5660
However,
market
stock
the
To
Northern Indiana Public Service
Established,
Co., Los Ange¬
Gordon D.
providing computing services.
in
Angeles, Calif.
Louisiana Securities
Vice-President,
Richards &
les, Calif. (Page 2)
originally
designed
and
made for the use of the company
Telecomputing Corporation
Michigan Gas & Electric
Associate Member N. T.
•
were
ANDERSON
ROBERT E.
Vice-President, Hill Richards & Co.,
Public
eit E. Anderson,
First
Kentucky Utilities
5Vz/52 &
are not intended to be, nor
sell the securities discussed.)
forum
(The articles contained in this
are
Common
Iowa Public Service
Central
Alabama &
Selections
Telecomputing Corporation—Rob-
particular security.
a
Hill
Utilities Assoc.
&
and
Participants
ineir
week, a different group of experts'
and advisory field from all sections of the country
in the investment
Colorado Interstate Gas
Conv.
Forum
A continuous forum in which, each
Arkansas Missouri Power
Eastern
Week's
This
Security I Like Best
The
POSITION and
WE
matter
Continued
on
page
25
CHICAGO
New York 4, N. Y.
SAN FRANCISCO
Number 5162
Volume 176
.
.
The Commercial and Financial Chronicle
.
#
(1519)
Speculation in Coloi and Depth
INDEX
By IRA U. COBLEIGH
Articles and News
Author of
•»
"Expanding Your Income"
A
snapshot treatment of two bright
,"t': ' '
in the motion picture
oases
That
motion
picture entertain-, of process,
been
flickering
a
flagging industry for
is
well
many
evidenced
by
ship
and
months
the
field.
odd
movie
with
1
4,5 0 0
mand
p
a y-
houses
that
on,
have
shut¬
the
tered
den
on
Ex¬
while
and
prodi¬
gal
Hollywood.
The
stars
some
back; and
mood
to
studios
current
are
income taxes of
flashy
salaries
couple of
a
producer is
no
down
With
the
expression)
there
though
it
They're hopping
up
tax
even
few
a
Each
process.
patents
three
a
separate films
at
blue, and
all
time.
color!
They're also perfecting a
Monopack process which
lami¬
these
nates
color
deeper the decline
producers
all
in
attendance, the
have
Technicolor.
more
Thus it
for
is that sales
namely
finished
positive
print
165
million
feet
392
million
in
in
1946
1951.
stopping
to
over
there;
company
by
the end
and by
1954, 800 million. Although
this expansion is charted to cost
nearly $3
end,
million, current assets
million at the 1951 year-
plus current earning's rate,
that this expansion can
suggest
be
handled
without
public
fi¬
nancing.
*
Ansco
encouraging
more
motion
now
—P. C.
than
picture
en¬
20
61
21
Spencer__
Annual
Convention
in
for
color.
22
Philadelphia
America to Hold
Hollywood, Fla
Now
future, there's al¬
competition, present from
and
Eastman,
and later
lower
or
technique.
cost
Right now, Technicolor seems to
be to color, what Coca-Cola is to
Associated
14
We
See It
(Editorial)
___i
Cover
Bank and Insurance Stocks__
Canadian
Securities
5
______
came up with super
notices, that read like Holly¬
wood press agent prose. The now
Einzig—"European
and American Inflation"
and
scene,
seat,
Aida,
which
transports
you
thusiasm
promoted,
press
have
en¬
Funds
30
NSTA Notes
.
5
Reporter's Report
'I'.-.
•
■
'
'
.
•
•
hoUr
45
1
3
'
Our Reporter
dreds that Cinerama is the enter¬
tainment of
the
the
in
duplicate
glamour
Radio
Stock
might,
enterprise
opinion,
future.
Public
the
profitability of'
twenties, or Warner
and
in the
Brothers
Prospective
which,
common,
from
zoomed
two
to
new
for
a
let's
Continued,
take
on
*
a
few
page
33
32
in
*
Registration.
38
Security I Like Best
State
of Trade
and
2
Industry..^
5
"
Tomorrow's Markets (Walter Whyte
Says)
;
37
Washington and You
motion picture form
rampant,
soft drinks—the leader, by virtue
zeal
23
L
:
Now
7 The
and
41
____
Salesman's Corner
The
less
25
Offerings.
Securities
Securities
blow-
in
139
Utility
Securities
years.
enthusiasm
Lest
dramatic
run
24
Governments
Railroad Securities
by its first talking pic¬
ture, "The Jazz Singer" in 1927,
than
on
Security
their
of
some
in
Exchange PI., N. Y. 5
16
Observations—A. Wilfred May
Our
v-
40
Teletype NY 1-1825 & NY 1-1826
8
News About Banks and Bankers-
to hun¬
suggested
35
HA 2-0270
Mutual
the street feeling as though they'd
been shot out of a cannon.; Indi¬
and
*
Indications of Current Business
Activity
bodily to La Scala in Milan, have
vidual
Singer, Bean
& MACKIE, Inc.
22
From Washington Ahead of the
News—Carlisle Bargeron
that
your
•
8
_i__
rave
coaster
Light
8
Dealer-Broker Investment Recommendations
Sulphur
Puget Sound Power &
37
Coming Events in Investment Field
original cast,
Mexican Gulf
19
Business Man's Bookshelf
1
of
whom
would
merely
if they were viewing "An¬
thony and Cleopatra," with the
right out of
Corp.
Cinerama, Inc.
As
some
roller
Development
Regular Features
let's
on
you
Detroit
'
6
41st
;
Los Angeles
•
Chicago
24
and Research
about
yanks
Teletype NY 1-3370
Direct Wires
!
of
Broad-way, New York 6
BO 9-5133
Threatens Private Oil Industry
Investment Bankers Association
to offer.
appear
way-Shubert Theater, New York,
even
the most blase and cynical
magazine and newspaper critics,
from others who may work out a
new,
The
so
Reilly & Co.
Incorporated
Ma gill
What Business Wants from the Next
President
—Don G. Mitchell
torched
the
About
ways
on
J. F.
18
Optimism—Roger W. Babson
This
sent thousands of viewers out into
The
of this year an expansion program
will bring capacity to 600 million;
$10
17
When Can Congress Re duce
Taxes?—Roswell
depth
in
pictures.
Sept. 30, 1952, "This Is
Cinerama" opened at the Broad-
in
footage, have increased from
of
—George A. Sloan
91c for
$2.06.
16
Policy
More Stock Owners and Less Business
by Government!
—Charles E. Wilson
Grounds for
Cinerama Inc.
15
Draper, Jr._
benefit
results
14
Marx—Benjamin F. Fairless
Needed—A New and Long-Term
Foreign
fact
July.
thin
a
Moes
Unification of Europe and the Atlantic
Community
Ambassador William H.
bit better.
a
much
talk
mo¬
clamored
Technicolor, Inc.
product,
isn't
would
next
to
other
famous
the
the
13
Stimulate the Brokerage Business
The Great Mistake of Karl
over
Soundcraft
12
.
What Should Be Done to
—Maurice
Reeves
yawn
tion picture
of
elements
film.
The
and
Livingston
To Invest Abroad—We Must Make It
Easy to Invest at Home
—G. Keith Funston.
British
netted
4-6551
10
U. S. Supreme Court Upholds Otis
& Co. in Kaiser-Frazer Suit
When,
Put them
together and it spells Techni¬
one
owned
STREET, NEW YORK
Permanent Fixture"
a
Over Regulation
So
three
to red.
one
What of the Business Outlook?—J. A.
8%
an
as
Cinerama, Inc.
strip film
same
the
is
WALL
11
each
.
Anthony___
—Rep. Wright Patman
not
annual
share net by
figure,
cover
runs
camera
51%
died
per
certain
One film is sensitive to green, one
to
Law
cut
terprises
called
paid
Present
D.
growth
Technicolor, Inc. which has
hay while the films
is
1940.
99
Telephone: WHitehall
far,
Here, def¬
initely, is a colorful company with
current earnings and horizons of
the box office
Technicolor
been
company
1952 net
been making
shine.
what
the
should be
ple want color, and that's just fine
The
has
1951—down
with Technicolor attractions. Peo¬
with
share
subsidiary,
which
$500,000 last year;
picture extra.
a
"We Must Accept the National Debt
inte¬
more
a
6
Securities Dept.
9
Other facts of interest might be
thing
one
•
Obsolete
j.
obsoletes
'
handsomely if the Excess Profits
doing,
them
cost
may
hundred thousand
does
Sporn
have
5
Automobile Industry's Role in Business Outlook
—Edwin G. Nourse
argue that the
today
Technicolor's
Tax
is
are
sell!
6
yield.
"Gone
Technicolor, Inc.
moguls
24 lk
of $2, if sustained,
rate
any
May
A Glance at the Financial Situation—Julian
potentially profitable
than it was six years
since
that
However,
is
and
a
year
the Wind!"
movie
Power—Philip
enterprise,
ago when its stock sold five points
higher. About dividends, at least
million for movie rights to a best
seller.
Those
days
are
(you'll
pardon
around
company
years
in
to
4
Dangers Seen in Financial Disclosures by Candidates
—Harold J. King
inflated, and it would be
grated
quarter
a
project
way,
not too difficult to
25c
Nadler
you
compe¬
a
appear
below their
now
plunk
of
for TV)
probability of sturdy
quotation
great
Interest Rates—Marcus
HERE
if
Present and Prospective Place of Nuclear
Energy in Electric
it has ranged from a low of 6 in
1941 to high of 30 in 1945. Current
economy wave
in
the erst¬
Ira U. Cotileigh
big
for
Investment Return in Mexico—A. Wilfred
dynamic potential de¬
(now for movies, and later
931,273 shares of common, traded
on the N. Y. Curb where
change and by
the
Outlook
the
in
3
4
fact, together
regularly
the New .York
Stock
costly process,
a
that
capitalization, it's un¬
complicated, consisting merely of
cin¬
shares
ema
still
and
WISH YOU WERE
Cover
How Stable Is the Economy?—Sumner H. Slichter
the
About
perform¬
of
is
in
tition.
since
January 1951,
by the sod¬
ance
It
however,
some
—James F. Hughes
pioneering
TEnSItIF
AND COMfANY
l___Cover
Speculation in Color and Depth—Ira XL Cobleigh
know-how, salesman^
the
and
B. S.
Page
Outlook for the Stock Market Is Bearish
industry—Technicolor, Inc., and Cinerama, Inc.
merit-has
»
The Bull Market Is Not Over!—Kenneth Ward
'
.
of
3
44
5 MINUTES
FROM WALL ST.
N. Y.'s
*
*Not available this week.
-
largest Hotel
offers foremost
Published Twice
.
have
Weekly
PREFERRED STOCKS
specialized in
Drapers' Gardens. London,
land. c/o Edwards & Smith.
COMMERCIAL and
FINANCIAL CHRONICLE
Copyright
WILLIAM
7
1
.
*
Spencer Trask & Co.
Members
.
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BROAD
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York
Stock- Exchange
r
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Boston
•
Chicago
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V Schenectady
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Worcester
CROWELL, WEEDON & CO.
LOS ANGELES, CALIFORNIA
*
Y.
DANA
SEIBERT,
President
^ Thursday, October 23, 1952
statistical
-Other
'-»/
city
news,
Offices
Til
135
news,
bank
quotation
clearings
York,
as
banquets
by William B. Dana
1942,
N.
Y.,
second-class matter Febru¬
at the post office at New
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the
Act
of
March
1879.
8,
Subscriptions in United States, U.
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8.
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of
Canada,
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Other Countries, $52.00
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Other
Bank
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Outstanding values —for
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Telephone MAin 4-5000.
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Note—On account of the
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Monthly,
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*i
25,
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Every '.Thursday < general news and ad¬
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•
..
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Place,
ST., NEW YORK 4, N. Y.
TELEPHONE IlAnover 2-4300
Albany
B.
Park
E.
Company
Reg. U. S. Patent Office
Reentered
•
1952
*
.
facilities for
1
The
For many years we
La
STate
Salle
Si.
rate
of
made
in
exchange, remittances for for¬
eign subscriptions and advertisements
must
up
New
York funds.
Brooklyn, N. Y.
Bing & Bing, Inc., Management
<
Financial Chronicle
The Commercial and
4
.
.
.
Thursday, October 23, 1952
(1520)
prices dropped were
Economy?
How Stable Is the
By SUMNER II.
SLIGHTER*
will be
sion, when defense spending drops,
in
averting a reces¬
tough
a
Holds,
one.
that
there
men
change in debt management or money
Says money rates in coming months will be
influenced by level of business activity, which is likely to turn
downward during the coming year. Expects decline in interest
market policies.
during
periods
nine
were
physical output rose with¬
out interruption, at least as shown
by annual figures. One of these
which
recession is likely.
factors determining interest rates, Dr. Nadier
doubtful, whatever the outcome of the election,
whether there will be any
al¬
not
it is
states
rising
1889 and 1950
Between
prices.
are
Says major concern of business¬
for next two years should be development of policies to
deal with reduction in defense spending.
some
(but
usually
have
tion
University
After explaining
ways) been accompanied by
powerful instruments available, if used
wisely and effectively, that can avert a depression, but fore¬
sees
human frailty preventing their full and efficient use so,
however, there
Professor of Finance, New York
10%; in two more, between 5 and
10%.
Periods of expanding produc¬
both weak and strong forces
and concludes the problem of
By MARCUS NADLER*
wholesale prices was
over
30%;
in another it was
nearly 20%; in still another, over
Professor,
Harvard University
Professor Slichter analyzes
Outlook foi Interest Rates
or
years
In two of these declines
the drop in
Lamont University
the economy,
concentrated
four
of
declines
13
in
less each.
sometime
rates
next
but
year,
will affect various
it
says
segments of bond market differently.
Money rates
the resultant of
years,'one"was va^S^^ti^the
The °Utl0ok
Only bought careful ^
are
C™
•
™
economy.
has been due to the
I
about
In
two
years
of the
and for¬
eign aid to begin to drop. The de¬
expect
may
the
outlays
government for defense
crease w
around
i 11 be
lion
a
bil¬
$5
lion to $10
bil¬
and
two
three
or
years.
of
ability
country
of
the
to
adjust itself
the drop in
to
the demand for
goods
defense
depend
will
run
more
the ca¬
of the
upon
the expansion of the
has been rapid,
physical
output growing
80% to more than 100%
economy
with
from
every
the growth has not been
14 of the 61 years!
1889 to 1950, the physical
20 years,
In
steady.
from
of the economy dropped.
other words, the economy has
output
In
been
23%
six years
during
about
of the time and expanding
contracting
conclusions
level were quite large.
three
lnrJze luture;
and
during
about
and
that
market.
of thesp
h
and
on
tne
an
the
sup-
II
had
for this
foundation
anal¬
ysis, I wish to look briefly at the
movements of output and prices
over
the last 60 years.
this
of
period
growing.
dollars
the
During most
economy
was
Its output, expressed in
constant
purchasing
of
of
In
almost trebled.
price level was
preceding year.
other words, prices were falling
wholesale
erage
In
one-third
rising
two-thirds of the
The drops in prices, how¬
years
and
1929;
80%
the
in
21
the
about
increased about 115% in time.
from 1889 to 1909; ever,
112% in the 20 years from 1909 to
20
of
time
years
much greater than the
were
declines
year, so
address
by Dr. Slichter before
Kentucky Bankers Association, Louis¬
and
about
drops in output. Some of
from 1929 to 1950. Part of the rise
the rise
lower than in the
power,
the
But
prices has been far from steady.
21 years out of the 61, the av¬
ran
for
the price
more
than
a
that the 21 years in which
*An
the
ville,
did
1952.
Ky., Oct. 20,
1 There
not
have been a drop which
show up in the annual figures.
may
the
money
important changes in
will be made by
Administration.
rates
Seasonal would
in
the
few
next
be influenced prima-
months will
level of business ac-
From present indications it
appear that
sometime dur-
7n^nepXperC1Se onIy a tem" j?g.,the
77%
increase in nrivate
ex-
plant and equipfor nearly five years has
smaller
siderably
in
than
the fact
for
high rate of
a
sunnlied
f 51
and
r^L
nf
several
ing in the international political
situation. While military expendi¬
tures
level,
should
(2)
the
the
that
fact
ctortc
been subSeasonal factors also play an
Jimportant role at present. This is
the increase
ing
of
number
^me 0£ the
families.
The
year
the
next
fiscal
year,
will remain at a
under present plans
high
they
not increase.
Capital
expenditures
by
business, which at present are at
a very high level, are likely to
decrease sometime next year. This
is due to the tact that capital outlays during the last few years have
been extremely large, and many
from 3% to 31A%, the rise is cer^ to have an imPact on rates of
government obligations as well as
°ther high-grade bonds.
rountrv
for
1953-54,
years
bfantfafiv
stantially outrun
m
the
efficient nroducine
and
iKmbi
has
and
on
well
nrettv
with^iew
canacitv^
1955 and
1954; (4)
in
1953
that
penditures
ment
(i) Military expenditures will
level off after the middle of the
year. This, of course, assumes no
unforeseen event nor any worsen-
state at the moment However
should the prime rate be increased
that the
the fact
(3)
years;
or
are as follows:
At present there is even a question as to whether the prime com—
mercial rate will remain at 3% or
will be increased to 3A%. There
are factors which favor an inurease and others which favor
leaving the rate unchanged What
will take place is impossible to
maturities of E bonds will be con-
1956
ve„r
1® bound to continue high.
oension funds
during the last six years; (2) the
large rise in corporate and personal indebtedness during the last
six
year busl.nesa ae"
tivity will turn downward. When
the downturn will come itisim'
it
in the year 01 it may not come
of until towards the end of the year
The principal factors which will
bring about a moderate decline in
business activity, briefly stated,
fonda Bnd
government obligations.
a
new
Money
tivity.
the
As
the
no
credit rjjy
capital.
.
.
or
At least in the immediate
debt management
of
con-
material effect
management
future,
ana
some
to what may take
It is doubtful
as
tion will have any
on
then
tinn
the clue
us
whether the outcome of the elec¬
of the time. tractions are accompanied by substantial
drons in the nrice level Porary inlluence.
Sumner H. Slichter
and contractions of
economy to Expansions
(3) The position of
Treasproduction
correspond has always been an important ingrow.
If the physical
fluence on business thinking and "ry. wblch has ? baanng °? tha
drop in defense spending comes in quite closely to booms and reces¬ ha* limited
the
willingness
of demand for and
the supply of
sions
in employment or in the
one of the periods when the econ¬
on P»ces
dollar volume of output, but not managements to expand their en- short-term
omy is expanding, the adjustment
terprises. If the danger of genwill
probably
be
made
quite exactly. For example, some re¬
eral drops in demand could be
(4) The movement of commodsmoothly. On the other hand, if cessions such as 1924, 1927, or
substantially mitigated, there is ity prices, that is, whether the
the drop is super-imposed on a 1949, were not accompanied by
little
doubt
that most" business economy is in a period of an inmore
or
less normal period
of any drop in the annual figures for
Furthermore, there concerns would plan more am- flationary or a deflationary trend.
recession, the resulting contrac¬ production.!
(5) The policies of the Reserve
tion
could
be
substantial
and have been some periods of boom, bitiously for expansion. The rewould
be
a
more
rapid authorities, which are influenced
such as 1920, 1945, and 1946, when suit
painful.
all the factors enumerated
the annual figures for output were growth in output and in the coun- by
In these remarks I wish to ex¬
above and which in turn have a
below those of the previous year. try's standard of consumption.
amine in a fairly concrete fashion
bearing on the money market and
Most of the drops in physical pro¬
some of the weak spots and strong
H
III
hence on money rates.
duction have been small—in nine
spots in the economy. I have two
The success of the economy in
out of the fourteen cases the drop
Business Activity
prrposes in mind.
In the first
was
less than 5%.
The largest adjusting itself to a drop in de¬
Business activity today is at a
1 j ce, I wish to shed light on the
fense spending will depend upon
problem of adjusting the econ¬ drop was 14%. It occurred be¬ the weaknesses and strengths in high level and in all probability
tween 1931 and 1932.
omy to a drop in defense expen¬
the " economy.
What are these will continue at this level, or even
The movement of prices during
ditures. In the second place, I wish
weaknesses and
strengths?
The increase, during the next few
to
indicate
some
policies that the last 60 years has, in general,
great.weaknesses are (1) the large months. So long as business acwould help make the adjustment been upward. In 1950 the whole¬
increase
in
automatic
savings tivity remains at the present level
sale price level was over 180%
come easier.
brought about by the enormous the demand for credit and capital
above
1889—in
other words, it
pacity
bear-
piace jn the future.
*°r
Marcus Nadier
the various
direct
a
*n£ 0n the money market may give
are, Drietiy:
effect
is interrupted every now
by periods of contrac-
output
have
is:
rates
Here, again,
analysis of
which
in turn has
24%.
growth
interest
of
activity, which
of expanding out¬
put (1894 to 1903) the price level
another period
the
forces
(1) Business
(the period of the First
World War) nearly 100%. In still
that
-
careful
a
tors to consiaer
them
fact
most
ine
important fac-
periods the price level ad¬
over 30%
and in one of
The
**1
*
vanced
increased
movement
what is the outlook?
as
to what money
In
price
at work.
men
Although
can one
valid
reach
without interruption
rise in output per man-hour. In except for a slight one in 1949.2
In seven of these nine periods of
fact, during the last 20 years or so,
expanding production the price
about 73% of the gain in total pro¬
duction was due to more output level rose and in two of them it
fell.
Some of the rises in the
per man-hour, and about 27% to
continue
for
=
Z&ZA W
gain
production has been due to the
in
year,
will
The
growth of the
force, but most of the
labor
less one
or
when crops
expansion programs have already
been completed,
(3) Family formation during
the next few years will be smaller
than during the last few years,
This trend in turn will have a
bearing on the demand for new
homes. A decline in home construction may be expected and
this will lead to a decline in the
supply of mortgages,
<4) Because of the sharp mcrease in the productive capacity
of the country, the seller's market
is bound to come to an end The
buyer's market will reassert itself,
Competition will be
keen,
per-
haps keener than ever before,
large rise in debt and the large muia£ed> This naturally leads to
(5) Exports from the United
expenditures on plant, equipment, an jncrease in the volume of com- States are already decreasing, and
Corporation
management of Baruch Oil Corporation Is preparing a report
on
current
as
well
as
production of Gas and Distillate
Oil
production
on
the
its Louisiana properties
on
corporation's
leaseholds
in
Natrona
on
the money market.
The creased, one may expect increased
a
in the world's mar-
portion of which have been bought
All these factors combined lead
Because the sub- to the conclusion that sometime
maintaining scriptions by corporations for these next year a decline in business-
large volume of liquid resources;
(2) fairly well-developed arrange- by corporations.
for
partly
personal incomes in periods tax anticipation bills are handled
contraction; (3) some backlog through the tax and loan accounts,
similar in
character to
activity,
of
of
that which occurred in 1949, may
take place. Should this happen, it
shareholders
of record,
it is suggested that all stockholders
already done
transfer
so.
agent is The
United States
Corporation Company
at
by registered mail,
properly endorsed and signature guaranteed,
agent with funds to cover the Federal
Stamp
Taxes.
to the
field
400 MADISON AVE., NEW YORK
of
js bound to have an important
demand for additional reserve bearing on money rates:
new balances.
Unless these reserve
The demand for credit and
new balances are furnished by the Fed- car,ital
should be somewhat
(5) eral Reserve Banks through pur- smaner
that chases of government securities in
*
bv the open market, the result is
(2) It is certain that the moment
Dy
(4) recent important gains in the
capacity of industry to create
investment opportunities and
and better consumer goods;
strong spirit of caution
decision-making
decision maxing
the
BARUCH OIL CORPORATION
needs, particularly in the resulting increase in deposits
public construction; of the commercial banks creates
unmet
the
r
Exchange Place, Jersey City, N. J. All securities should be forwarded
transfer
fluence
principal elements of Treasury has offered $2^ billion competition
strength in the economy are: (1) of tax anticipation bills, a large kets.
The
of Baruch
the corporation's operations are mailed only to
The
countries is
have their stock registered in their names if they have
reports on
15
inventories accu-
many
Because
not
gravate that contraction.
ments
County, Wyoming, for the benefit of shareholders.
Oil Corporation
and
sonai increase in the volume of increased, exports during the cornsuggest that the drop in defense ioang has not been as great as ing year should be smaller than
spending will more or less co- originally expected.
during the past year. Moreover,
incide with a normal contraction
The current
position of the since the productive capacity of
atter a boom and may greatly agTreasury is also exercising an in- the European countries has in-
TO STOCKHOLDERS OF
The
moved
fv? iTSin! are cl^aracfenstlcand mercial loans. However, the sea- unless aid to foreign
°*
tne
later phases or a
boom
NOTICE
Baruch Oil
are
dominates
dominates
a
+ighter
Continued
17
on
page
*A
2
as
Physical
a
There
whole
was
output
was
a
the
small
in
the
sanne
year
as
drop within
<n
the
1949
j.
year
business activity turns downward
and unemployment increases, the
money
'
26
stenographic
report
of remarks by
Dr. Nadier before the Investment
ciation
of
New York, New York
October 15. 1952.
AssoCity,
policy of the Reserve authorities
underg0 a change.
It will
.
®
,
.
wm
again be the policy OT tnP mOH6-
Number 5162
Volume 176
.
.
.
The Commercial and Financial Chronicle
(1521)
authorities
tary
lower
to
rates to stimulate
money
revival of bus¬
a
iness
activity.
serve
authorities will endeavor to
Whether the
Re¬
Steel
The
operations
or
operations,
but also will have
prices
on
tions
of
and
other
this
will
additional
create
and
bearing
obliga¬
prices of all
on
connection
the
fact
sensitive to
much
are
decline in bus¬
a
iness activity than to
business
activity from degenerat¬
sharp decline.
ing into
a
will
be
impossible
certain
next
to
state.
that
in
It
billion
bills.
In
the
last
week.
the
ury should operate with
Under
these
the
Treasury may not need any new
money until the middle of next
How large the needs of the
Treasury
will
will
become
when the
sented
be
in
1953-54
January,
budget will be
new
the
to
during
clear
Congress.
Should
Treasury be operating with a
larger deficit than is anticipated
at present,
one may
expect,
as
in
the past, that the Reserve authori¬
ties will endeavor
to
assist, the
Treasury
ease
i n obtaining the
This will also tend to
rates at least
borrowing period.
money
While
during
the
sometime
the
movement of the various seg¬
ments of the bond market will not
be
uniform.
If
the
deficit of
to
some
will widen.
Similarly,
if the supply
of tax-exempt obli¬
gations should increase rapidly, it
quite
spread
possible
between tax
that
the
exempts and
high-grade
corporate
also widen.
No important
bonds
will
changes
in
commodity prices are to be ex¬
pected during the next few months.
see
(1)
the
In
immediate
rates
will
This
at
ap¬
their present level.
The only change that might occur
would be caused by an increase in
the prime commercial rate. Should
this
take
place,
crease.
then
witness
all
money
moderate
a
in¬
>
(2) So long
remains
at
important
business activity
as
the
present level,
downward change
no
in
money rates can be expected.
a
decline sometime in 1953 is in¬
dicated—a lowering of money rates
be
expected.
The
decline,
however, will not
go to the levels
which prevailed prior to the time
when government securities were
pegged by the Reserve authorities.
only will the demand for
return
which
to
production, but
policy under
a
government
securities
are
pegged by the Reserve authorities
is not
(4)
to
be
expected.
Finally,
the
flexible
open
market policy of the Reserve
thorities will
definite
future,
continue for
period
of
assuming
time.
no
the
role
Reserve
position
in
the
the
Treasury.
in¬
war,
a more
than
needs
au¬
the
policies
authorities
and
In
major
business activity will play
important
an
of
of
the
the
skilled
of
last week was placed at 106.5%
the all-time high record reached
o r
of
given by this trade
reason
are
considered least profitable in
a
est
paper
ing
like
suspicion
on
that
certain
Demand for line
satisfied
most
in
people
the
bars is
oil
Once
steel
these
demands
industry
have
This
all
short
supply.
immediate
critical
very
it
is
bonds
return
then
ing the 10
our
way
of
own
'|v
tral Bank of
tected
the
by
program,
of
projects
bonds'
an
struction
of
financed
are
scrap
stocks
limit
are
of
in
fine
their
bond,
a
(that
breaking operations will keep plenty of pressure on
especially when winter weather tends to curtail
the
from
Such
Chrysler
Corp.'s
return
to
full
production,
its
after
changeover program, was the main reason United
auto output last week rose 4% above the
previous week.
physical
our
also
Business
C.
con¬
was
a
Overtime
a
year
are
on
"Ward's"
predicted
of
agency.
on
to
shut
the
United
down
two
Mine
emergency as stockpiles above ground are
enough for 80 days
consumption, it is reported. In addition, producers of more than
100 million tons a
year, who are non-union or represented by,
another union, will continue to
operate.
The United States Department of Commerce
currently reports
that this country's exports in
August were 20% below the average
for the first six months this
year and 15% under the 1951 monthly
rate. The August total of
$1,070,400,000 was $198 million less than
in August,
were
$54 million
on
of
page
29
charges
copies
China
Fitch
pany,
23
before
the
our
2.76%
on
Lob-Lolly
—
The
re¬
Geraldine
—
Devin-Adair
East
26th
Com¬
Street,
New
York 10, N. Y.—paper—35c (quan¬
tity prices
on
request)
There is
Manufacturing
forms
of
Industries
West Virginia—James
H.
son—Bureau of Business
bond
of
Thomp¬
Research,
College of Commerce, West Vir¬
Va.—Paper.
Usurpation of Power: Arch En¬
emy
of Individual Liberty—Ham¬
ilton A. Long
age
American Herit¬
—
Education
Corporation,
the
•
zero
to
3999, with request)
ANNOUNCEMENT
BARUCH
&
•
INC. WILL CONDUCT
CO.,
THE SECURITIES BUSINESS FORMERLY
hour above the maximum
permitted under the
WSB's cost of living regulations. The strike will
create no early
Continued
number
a
Workers
an
While August exports
on
more
following
The board voted eight-to-four to slash the $1.90 a
day increase won from the operators to $1.50 on the grounds that
the full $1.90 would be
inflationary. The amount approved was
1951, it notes.
the
111.—paper—
request;
quested.
a
numbered from
increase.
about five-cents
and
on
514
drawings, the bonds, confined
Walnut Street, Philadelphia 6, Pa.
appreciation type, are di¬
vided into series of $4,000 units —paper—$1.00 (quantity prices on
The quota
the above agency asserts.
production
pay
Bond
Series K Bond.
Urbana,
coupon
the
to
strike.
steel
Soft coal miners' walkouts are
expected
than 80%
of
the nation's
bituminous
Wage Stabilization Board decision
a
In
addition
to
the
relatively
high interest return offered, the
savings bonds carry the additional
"sweetener"
of
a
prize-winning
lottery feature. For the purpose of
Authority's JL952
cars,
appreciation
has
Economic
of
Research, University
ginia University, Morgantown, W.
car
1,150,000
also
Avia¬
for multiple copies carry discounts
based
its
to
redemption
are
Illinois,
single copies
guarantee
a
Lottery Feature
schedules, said the
by 78,000 despite the recent
as
of the
Osborn—Bureau
of
certificates, bearer and registered.
companies would make 1.3 million
units in the final quarter,
bringing the year's total to 4.4 million.
If so, this would exceed the National Production
fourth quarter is
G
new
ago.
and
"extra hour"
pledged
Mexico
There
Saturday operations were holding the output
of most producers at a
high rate, states "Ward's." Chrysler Di¬
vision is scheduling daily overtime and
Saturday work, while all
but four assembly plants at Ford and
many factories at General
Motors
assets
Analysis
and Business
the income there¬
able only in the open market.
week, according to "Ward's Automotive
gain of more than 15% from the 89,685
in the like week
one
tion Industry in Illinois—Richards
the
6% coupon bond, which is
longer issued, and is purchase-
no
of 99,974 for the previous
This
as
holder's
Series
1953
States
Chrysler's production rose nearly 100% the past week. The
industry assembled 104,391 cars, compared with a revised figure
Reports."
by
on
proceeds
maturity)—contrasted
with
2%%
yield-to-maturity on
collection, concludes this trade authority.
model
run
most
-
"E"
which yields 5%
constant
is, there is no penalty for
bond
sources,
well
addition
In
capacity.
shape with
storage
banker
dur¬
of the bonds.
complete, while steel furnace and rolling mill
in place.
This means that demand for steel
will continue heavy throughout the winter.
65%
the
intelligently
nation's
progressive
merchants, Sen.
Josua
Saenz, with the title of
managing director of the National
Savings Board.
Sales are now
self-liquidating proj¬
the
from
2-3%
scrap
continuing bond sales
aver¬
exclusively for the
installations
to
a
to its maturity—
proceeds.
used
are
as
stocked
the
young
Mexico, they are pro¬
first mortgage on all
a
these
mills
There is
,
bond
advantageous
more
and
of
•!
Series E)
our
less than
years
ects;
record
ar¬
addition to carrying the guarantee
of the government and the cen¬
and
facilities
Going into the winter,
subject to the lottery
income
appreciation
no
Although the steel expansion program is well over half com¬
pleted, progress is not uniform. Latest reports show blast furnace
number
is
and
Bonds.
Moreover, they are com¬
pletely exempt from taxation.
In
Recommendations might also cover better mobilization
planning to offset recurring peaks of industrial expansion—espe¬
cially for defense supporting programs such as freight cars and
oil wells, asserts this trade
magazine.
But
Russia
high yield.
contrasted with the 3% offered
products.
is
principal
in
include
must
annual yield of 7.1773%
age
producing these items be operated at
capacity. This might mean channeling some semi-finished steel
away from production of items used more extensively in civilian
scrap
entire
that
very
a
by
their
on
amounts to
The NPA
needs
wonder
(the counterpart of
of
already recognize the cloudy profit
military items now in
will probably point to the
the
carry
banks,
90-120
day loans on
prime grade risks, and from 12 to
15% on paper from the average
yield
transporting
already thought to have been offset. New industrial plants, once
built, will stand for many years, declares this trade weekly.
recommend
Mexican
on their capi¬
(against 4 to 9%
from 8 to 12%
on
savings
military take of shell quality
a
high plateau. Though
needs are high, Iranian losses are
on
customarily
the attraction of
The
Some government sources
the
individ¬
one
proceeding at the rate of 15,000,000 pesos ($1,300,000)
per month,
with
redemptions 17%
of out¬
successful distribution of the Mex¬
standing bonds.
ican
already thought to have reached
drilling and
gov¬
to
lottery feature has been,
very well received by the public,
alleviating the necessity for using
high-pressure sales methods.
con¬
—
short-term
Small
been
little chance
see
18%
year
get
the
merchant.
pipe, heavy plates and structurals is geared
cycle.
to
rate.
here),
-
to
rangement.
In Mexico first mortgages
last
than
The
12
estate
tal
in extremely short supply now.
However,
expansion
May
which earned 32%
capacity boosted are large diameter bars, heavy
bearing piles, medium and heavy plates and
pipe and tubing.
are
Wilfred
ery
10%
a
the
every
other countries only the in¬
some
real
on
to
Thus—contrary
whereas
terest is
A.
trasted with 5 to 9% in the United
items
lottery
practically
rather
drawn,
t
from
ranges
peace¬
steel
n
in
country where it exists, is
"give the odds" to the bond¬
Mexico
-on
cover¬
h i
the
ual
bought all the outstanding
bonds, the effect would be to raise
his yield from 7.17 to 7.89%.
In
;
n
of
contradistinction
result in roulette—if
industrial
m a c
see
huge
rate
purchase
on
effect
in
holder
ily
'•
its
price,
outstanding fox'
quarterly drawings. The
more
ernment.
exam¬
States.
is based
to
extra-
n a r
the win¬
as
other
ple, the inter¬
paper
Once the basic expansion phase of the defense
program is
completed demand outlook for these products is not so promising.
the
d i
times
continues
situation
on
installme
These products
to
is
large.
in
are based on estimates of demand over
the next several years. When put to this test some of these
prod¬
ucts do not look like good
breadwinners, states this trade journal.
allocations
a
In fact,
labor was
years.
industry expansion plans
for the
also
supply
seven
structual shapes and
seamless
credit continue to be
high, because
the
about
of the product capacities the
government would
most like to
Not
of the high cost of
production
slightly under
survey
autos made
(3) The moment business activ¬
ity begins to turn downward—and
may
nation
in
40%;
interest
also
10
odds,
investments
continuing to
sorely needed for defense and defense supporting programs are
not being expanded as
rapidly as high profit, high demand peace¬
time items. Among the products in which the
government would
future,
remain
proximately
rates will
level
benefits
.
expanded most
making
money
the
insurance
of
aggregate
an
return
fixed
government circles. The
expansion
Conclusion
the
below the all-time
time economy.
survey-
also
of
lowest
ingot
or
some
is at
present anticipated, then the
between governments and
Mexico)
during each quarter.
This
winning bond receives a premium
39
it follows that
This week, states "The Iron
Age," a NPA survey of steel ex¬
pansion by products will probably result in keen disappointment
the
spread
in
bond being drawn
and
for
than
assured
the prior week.
outlook
is
at the
look"
a
less
For
Steel
government is much smaller than
corporates
unemployment
even
deign to "take
to-be
continuing at present levels.
decline in money rates
next year is indicated,
a
for
were
capacity,
new
money.
ner
not
during that conflict.
many parts
rather scanty.
pre¬
the
continued
in
surplus.
a
circumstances,
year.
set
decline,
is that
year, that is, from
30, 1953, the Treas¬
Jan. 1 to June
It
Claims
half
the
profits,
one
where the American investor will
moderately higher than that of a
and remained close to the highest level reached since
ago
in
of
visit
Mexico, land of
enterprise shows earnings of 20%;
many
the close of World War II, but was about 10%
record
anticipation
second
fiscal
present
is
additional
an
tax
of
yet
fairly
as
November
Treasury will offer
$2%
is
year
recent
where the average run-of-the-mill
Business Failures
producers to fill the backlog
of orders accumulated in recent
months, total industrial produc¬
tion trended slightly higher in the
period ended on Wednesday of
What the position of the Treas¬
ury
Industry
Spurred by the effort of
increase,
an
and that every effort will be made
to
prevent moderate decline in
a
easy
In
Production
J)
year
authorities
monetary
Auto
direct
a
during
Food Price Index
not
should be borne in mind that the
more
Commodity Price Index
government
hence
this
(Mr. May studied financial and economic matters
Trade
reserves
high-grade bonds.
In
Retail
State of Trade
Should the authorities choose open
market
By A. WILFRED MAY
Carloadings
through low¬
ering the reserve requirements is,
of course, impossible to state.
only
Investment Return in Mexico
Production
Electric Output
influence the market through open
market
5
OPERATED
BARUCH,
UNDER
THE
ROTHSCHILD
t
44 WALL STREET
NAME. OF
CO.,
INC.
Financial Chronicle
The Commercial and
<3
.
.
Thursday, October 23, 1952
.
(1522)
metallurgical problem of
• materials
capable of
standing the high temperatures
needed in equipment for the mod¬
ern thermal system of power generation, while at the same time the
material is subject to neutron and
the
is
Prospective Place of
Nuclear Energy in Electric Power
Present and
PHILIP SPORN*
By
President, American Gas
There
ability of integrating nuclear power development program with
overall short-term low-cost energy requirements—follow¬
ing pattern of our
technology in other fields.
Recently there has been a new
optimism about prospects for nu¬
clear power. There is justification
for this optimism; but it is impor¬
of
development
power
by¬
a
as
of producing, plutonium.
a number of highly
product
work
this
In
exactly what it
competent private industrial con¬
cerns
are
actively collaborating
with AEC and with one another
signifies.
and
know
to
tant
At the outset
is
it
necessary
re-empha¬
to
point
mentary
nuclear
that
if and
energy,
when it can
be
utilized to pro¬
electric
duce
power econom-
11 y,
will
merely provide
i
Spom
Philip
c a
a
fuel. It, and the
*
•
.
form of
new
producing it, will thus
take the place of the boiler side of
a thermal electric generating sta¬
tion. The conventional steam tur¬
bines and all the rest of the power
reactor
still
be
What
hope for,
we
at
as
necessary
their
are
taking.
Finally, the optimism reflects
encouraging experience that
the
the Atomic Energy
Commission is
to get in connection
operation of a number of
experimental reactors.
These
beginning
with the
its
reactors which have
now
being
increase the scope
of our
completed,
been
only recently
used to
knowledge of
are
number of impor¬
a
phases of reactor
tant
technology.
developments deserve
closer examination to measure
These
their full significance.
therefore, in Corporation.
The reactor power
plant is being developed and will
primarily to reduce the be built by the Westinghouse
one
of the elements of Electric Corporation working
ergy
is
cost
in
production, namely, fuel. jointly with Argonne National
Even though fuel is but one of a
Laboratory. In due course the sub¬
number of vital elements, it is of marine and
propulsion equipment
course extremely important. Fuel
with a^nuclear power plant will
represents a large portion of the be completed.
No one who has
production costs and also of the been permitted to come into close
power
generated
overall costs of thermal
with this
contact
project has any
if the more doubt that the undertaking will be
optivmistic ideas as to breeding— highly successful. Other projects
and associated chemical processes for the
propulsion of submarines
—can
be realized, the fuel cost and
airplanes are
currently in
could be reduced by nuclear re¬
progress under the auspices of the
actors to perhaps 10% of what is Atomic
Energy Commission or De¬
And
today.
power
in
experienced
conventional
a
steam boiler.
I need to
is
emphasize further that
between
radical cheapen¬
powered
ing in fuel cost for power through
nuclear energy is still only a hope.
recent
During
Department.
There
this prospect of a
the technical
there
question
has
years
been any real
never
fense
or
to
as
mechanical feasi¬
could
be
nuclear
not
produced
conventional power
a
energy
cheaper than
at least at
or
comparable cost.
'. Until
a
plant
ago
it
was
speak of nuclear
stations as something to be
to
pulsion of
the
same
plants for the pro¬
submarine
a
feasi¬
are
technology to design and con¬
struct nuclear reactors that would
produce
a
unit of electric energy
commercial
military
purposes
the
near
ventional
$400,000,000
same
at
cost
use
to
ment
it
amount
of
that
projects
con¬
like
sub¬
status.
expected in
matter of "decades."
a
marine
or,
craft
sion.
does this
What
reflect insofar
as
optimism really
prospects for
nu¬
clear power are concerned and
in
what way does it reject or qualify
the views of
a
little while ago?
might
isfaction
with
a
because
nuclear
as
part of
its propulsion equipment will soon
be
an
accomplished
fact.
V-k
Second, it reflects the fact that
being
done
looking
toward
one
sources
cent
not of
address
by Mr. Sporn before the
Conference
on
Atomic
Energy
of
National
the
Industrial
Board, New York City,
Oct.
Conference
16,
of
electric
power,
be. substantially under
per
kilowatt hour. I
am
1952.
scale.
reason
areas
where
conventional
remote
fuel
is
unavailable.
unsolved
problems
make nuclear power so
which
costly
are
quite technical and I shall merely
mention
a
number of them. There
leaders
more
our
gov¬
well
may
means
end
an
effort
collect
to
the
case
Kaiser-Frazer's
to
$3,120,743.51
in
damages from Otis & Co.
It also
establishes the principle that an
underwriter
contract
had
Frazer
with;' Kaiser-
contract
Otis
The
as
condition
a
that
be accurate."' The
Circuit Court of Appeals for New
the
prospectus
Kaiser-Frazer's
that
held
York
of
quarter
that
and
fore
be;
misleading
was
Co.
&
legitimately
the
out
1947
Otis
could there¬
refuse
to
carry
contract.
Earlier
the
United
States
Dis¬
trict Court had held that Kaiser-
will not Frazer was entitled to damages of
discharge $3,120,743 for Otis & Compony's
with dignity refusal to buy its securities.
means
It
fortunate
losophy
to
see
means
adopted the phi¬
accepted
apparendv
tb°t the
At
first
the
trial
the
of
case
both sides charged fraud with Otis
&
Co.
in filing
a
accusing Kaiser-Frazer of
false and misleading pros¬
compensa¬
pectus with the Securities and Ex¬
officials should be
change Commission while Kaiserthat supplementation by
Frazer
charged Otis & Co. had
of
graft is required.
In
anything
event,
any
riously
class
narrows
candidates
not conducive
is
in
un¬
of public
low
so
while
certainly would be
nations
come
tion
and
functions
proper
office.
power
which se¬ purposely started a stockholders'
the field of high suit the day the transaction was
for
to
public office
good govern¬
ment.
As to (2)
and (3), it is interest¬
be
to
have
the
consummated
a
basis
for
in
order
to
nullification
of
contract.
Following the trial court's deci¬
ing to note that a government
investigating body in Sweden re¬ sion in 1950, Kaiser-Frazer sought
byprod¬
But
this
statement
that it would have to. be,
perhaps relatively immediate
prospects for using nuclear power government
in
ele¬
economic
of
allowances, for
independent
their
likely to remain exceptionaL-rfor
underwritten
purposes
Supreme
cently concluded that anonvmous the liquidation of Otis & Co. But
sub-, domestic contributions for the fi¬
the investment banking firm pe¬
nancing of political parties, elec¬
titioned the court for permission
of the situation should also make
tions'campaigns, and newspapers
clear
that
such an operation is
should not be branded as objec¬ to reorganize under Section 10 of
stantial
the
civilian
the
of
ment of nuclear energy on a
leaving out of account in this talk
the
Special
In this way, power as a
refusal
Court to give a hearing to
a
terms
expeditiously
one
the
The
•An
where
begin to be of interest
use
competitive with
civilian
other
for
substantial and rewarding work is
acceptable
be
of automobiles.
The
lack the wherewithal to
ranged from 2 cents even uct of plutonium could afford an
dollars per kilowatt hour. exciting prospect for early develop¬
In order to
for
submarine
a
reactor
as
essential
an
Greater compensation, and
ernmental
the costs
to
costs must
First, it reflects the natural sat¬
encouraging
are
manufactur¬
to
in the public interest, so that those
by conventional fuels;
might credit the whole
This has meant that it was not crete demonstrations of achieve¬ plutonium process with the ordi¬
believed that economic feasibility ment and because they can teach nary commercial value of the heat
could be realized in a lesser time. us things which may be relevant
energy used to
produce electric
It is against the background 'of to ultimate civilian applications of power and thus obtain a material
these views of the recent past that atomic energy. But they cannot be
reduction in the cost of producing
we need to ascertain the meaning
thought of as too closely connected plutonium.
of
the
new
mood
of
optimism with the problem of civilian appliPlutonium as a Byproduct
which is currently finding expres¬ tion. Electric energy for military
power
high
personal "worth"
in
expense
produced
con¬
the
be in line with
public
of
certain amoun'
a
dignity in
less
or
obtaining electric power at a cost
that would
attracted
And
evaluates
thus
with
the
Kaiser-
the
of
stock
Corporation,
society which statement
of
earnings
for
the
traditionally (rightly, or wrongly) month of December and the fourth
full
and
value
edi¬
privacy
ment of
gen¬
the
with
in
is
it
individuals
financial affairs
using the present
operation
of
political issues.
is an essential in¬
gredient of such. Especially is r
plutonium to the govern¬
as
a
base,
crediting the
whole
be
of
get the byproduct power at
cost. This might be
of
(1),
any
the
of
Frazer
ers
expression
that
dividuals.
accomplished—in a manner famil¬
iar to us in ordinary byproduct
cost
to
contract to underwrite $10 mil¬
lion
the'
communication
on
a
may safely break a
if the issuer's prospectus
public contains misstatements in viola¬
service, and particularly to thr" tion of the Securities Act of 1933.
top posts. Dignity in public serv¬
The
Securities
and
Exchange
ice is one feature which may b?
Act requires filing of a registra¬
used to attract well qualified in¬
tion
statement and; prospectus.
the net effect might
operations—by
parties and elec¬
of
the
calibre
sO
Progress
fuels.
As
attractive
an
any¬
as
to
put
were
erate energy,
to
interest
plutonium
reactor
that the heat now
operation
wasted
media
given
the
modify
be to
if
to
F
donated)
amounts
torial comment
expan¬
possible
•
campaigns; and
other
River
Obviously
Hanford.
technically
were
.-i'v.1
all details concerning
financing of newspapers, and
by the tremendous build¬
over
•.
(3)
rejected to the Columbia River,
primary purpose of the re¬
actor being to produce plutonium.
There is right now great military
need
for
more
plutonium—evi¬
at
about
tion
the
Savannah
the
(and
-v
of all contribu¬
names
fill political
to
great deal
at
." v: '■
;
:
•
the
tors
generated. But the heat
program
-.-j,.-.\-•
(2)
produce
ing
~ ■"
\
_•
is
sion
central
dates for all public offices, major of Cleveland, O., was within their
and minor;
legal rights when they abrogated
material—plu¬
tonium—which is then made into
bombs. In that process a
Supreme Court refused to review
a
decision of the U. S. Circuit
the details of the financial Court of Appeals, declaring that
status of the candi¬ Otis & Co., investment bankers
(1)
another fissionable
of heat is
States
United
the
20,
history and
from conven¬
tion of U-235 is utilized to
Oct.
On
not also entitled to
are
stock in 1948.
company
they have this
know:
producing fissionable material
also produce heat. At the Hanford
reactors, for example, fissionable
material in the form of natural
uranium containing a small frac¬
sub¬
a
a
ble, why is it not possible to use
the same kind
of plant for the
where
right,,and
in
driving
of
size. If nuclear
of
be maintained that
Nuclear reactors
sources?
tional
the
carrier and
or
station
a
in line with power
and
plant
marine
for
time
short
customary
moment ago the
I mentioned a
fuel-
bility of using nuclear energy to
the fuel for electric generation of central station
power. The only serious question
power? There is no reason except
has
been, and still is, one
of the matter of economics. It simply
economic feasibility,
that is, is not possible in the present state
or
oil.
or
conventional
the
provide
whether
reasoning
fuels—coal or gas
by conventional
denced
material difference
no
Supreme Court
Kaiser-Frazer Suit
On June 14
attempting to perfect nuclear en¬
current rash of personal financial disclosures
on
Upholds Oils & Co. in
nuclear
first
the
v."'
•>.
Commenting
U. S.
the keel was laid for
of this year
;
.by candidates, Dr. King indicates adverse consequences which
operating underg
by flight
may stem logically from such practices, v Notes recent finding
temperatures needed for effi¬
of government investigating body in Sweden.
ciency, whereas high temperatures
Recent developments have made of the Presidential and Vice-Presi¬
may be bad for the safety of the
reactor; there is the problem;, of ; the Presidential and Vice-Presi¬ dential condidates of 1952 taken
chemical processing
of radiated dential candidates of both major more or less "under duress" do
materials; and there is the prob¬ political parties feel obligated to not lead to the general acceptance
of the premise stated above.
lem of disposal of the large quan¬
reveal
details
For
tities of radioactive Wastes—fis¬
the exercise of the right supposed
concerning
in the premise, along with those
sion products — which will ac-- their personal
others which stem logically there¬
cumulate in the course of process¬ finances; or
it
ing the nuclear fuels. All of these made
from, could very well lead to the
ap¬
distruction of the form of govern¬
complications add greatly to the* pear to them
ment which gives political rights
difficulties and to the cost of pro¬ politically exto the people.-'
ducing heat in a form that can be: pedient that
utilized by the heat engine — a they shculd so
steam turbine or a gas turbine,,to; do.
At
first
name
the two most likely me¬ glance, it may
chanical froms of that engine. All,
appear
more
.evaluation of the final cost of
than
reason¬
producing a unit of energy, in the able to con¬
light of these complications, .leads tend that the
to the conclusion that under pres- \
people have a
Harold J. King
ent conditions a plant using nu¬
right to such
High Court refuses to review
clear fuel — assuming such; fuel
information.
lower court ruling Cleveland firm
could be made available under the
However, it is well worth con¬
was within its rights in breaking
pressing military needs of today sidering where acceptance of this
'—woi be far more expensive than
contract to underwrite automo¬
premise logically leads.
For it
the same unit of energy produced
can not with consistent
bile
developments looking toward pro¬
powered sub¬ duction of power as a byproduct of
marine. The hull of this submarine
plutonium. How significant are
on will is being built by the Electric Boat such developments as a means of
present. Division of General Dynamics
bringing cost of power more closely
that point
from
system
their
ele¬
the
size
,
utilizing some of
most skilled personnel and
own
funds in the under¬
they
t
imposed
limitations
the
our
By HAROLD J. KING, Ph.D.
V
•
,
systems
transfer
economic feasi¬
bility of early use of atomic energy to provide fuel for electric
power, because of comparative cost factor.
Stresses advis¬
public utility industrialist doubts
Prominent
.
radiation bombardment.
is
the problem > of heat
other
and Electric Company
Dangers Seen in Financial
Disclosures by Candidates
finding
by
a
guaranty
long-term
of
dubious
soundness.
A
few
words
are
necessary
to
explain this conclusion. Feasibility
in development along this route
depends upon the availability of a
continuing market for plutonium
Continued
on
page
36
tionable, and that legislation
■
quiring
of
the
filing
contributors
of
would
the
re¬
names
not
discussion and
opinion, but would actually con¬
with
flict
crecy
the
principle
of
thus
safe¬
public
guard
the National Bankruptcy Act and;
se¬
The
in
Let it be hoped that the actions
24,
1952.
Financial
decision
Court
of
rendered
Appeals,
last
April,
sion, and the case was subsequent¬
ly
Jan.
and
a
the judgment.
Circuit
reversed the District Court's deci¬
of the ballot.1
1 Commercial
stay in business and permit
it to fight
carried
to
the
Chronicle,
Supreme Court.
United
States
Volume 176
Number 5162
.
.
The Commercial and Financial Chronicle
.
(1523)
PUGET STOCKHOLDERS KNOW SIX-DISTRICT
PURCHASE BEST FOR THEM!
Not misled, won't be misled by
"Last-Ditch," "Frantic" appeals to "Torpedo" District Purchase
The
a
Washington Water Power "hastily cooked-up"
bona fide offer... not
firm offer... has not
a
Washington Water Power stockholders
WOULD YOU EXCHANGE SOMETHING FOR
stockholders of
in
NOTHING?
Offer,
In the Six-District Purchase
Puget stockholder, have
you, as a
something: A real opportunity to get
out of Puget on an attrac¬
your money
tive basis.
Puget have
critical power
trial
shortage is right
adversely affecting the Pacific Northwest—which
situation
would be
materially improved by the Six-
District Purchase—the
management of the
Water
Power
Company and
small
a
Washington Water Power Company
"rush
act" merger
scheme offers
motives and in utter
their acts
you
vigorously fought for
years to prevent
destruction of your property
by
the condemnation "axe."
the
disregard of the
In
of
Puget's stockholders,
My
that the best interests and the rights
concern is
customers and employees be
protected. Therefore, I respectfully petition that you
cause
the appropriate
F.P.C.
or
the
Federal agency (F.T.C., S.E.C.,
Department of Justice) to conduct
and certain investment bankers
Washington Water Power
September 11, 1952,
trict Purchase
or
with condemnation of
group to
the
use
Puget's property.
a merger
get started
on
scheme
same
sort of tactics and
obtaining the
and other
power
irreparably damaged and,
among
other
things, the market price of their stock
be
adversely
affected.
power
URGED
OF SABOTAGE TACTICS. On Monday,
copies of it,
were
a
sent to
of $1,000,000 per year
factors of
or
rumors
the
to
effect
Washington Water Power
Washington. The telegram read
Western
workings of
favor
of
our
of
a
merger
public power—(2)
offer to
Company.
2/3 OF PUGET COMMON STOCK VOTES
IN FAVOR OF SIX-DISTRICT PURCHASE
OFFER. Puget stockholders know
thing when they
processes
through the
determined in
large majority of the
see
a
good
it. Notwithstanding
misleading statements issued and
the various pressures
applied by the
pro¬
ponents of the merger scheme, stock¬
holders'
support of the Six-District
Purchase Offer is evidenced
that the holders of
two-thirds of Puget's
essary
stock
such
by the fact
than the
more
have
nec¬
common
already voted in favor of
purchase. Your
own
good
sense re¬
merger
scheme.
And
no
chase
wonder! The Six-District Pur¬
Offer,
seems
like
a
seven years
in the making,
miracle. It is
who
are
Your Board of
Directors,
trying faithfully to discharge
their duties and trustee
obligations,
continue to recommend that you
accept
the Six-District Purchase Offer.
scheme.
scheme
as
that
was
to
the
management
"cooking up"
Puget for the
of
some sort
purpose
stockholders and
of
a
Six-District Purchase offer
any event
a
as
compared with
there exists
belief that such
ex¬
with Washington
merger
Water Power and concluded that
whatsoever for
a
no
are sure
Puget stockholders will
own
best
intelligently in their
interests
merger
any
by not revoking
proxies they have sent in and
that those who have not
"FOR"
the
as
yet voted
Six-District Purchase
basis
could in
will
promptly mail their proxies.
be in the best interests of the stockholders
Puget.
Coming at this late date, with the stockholders'
meeting
move
in
We
continue to act
recommending its accept¬
by them, Puget's Board of Directors fully
ferred
a
to make
so as
Puget's stockholders
quently, before submitting the Six-District Purchase
scheme
Washington have
democratic
stock
of Wash¬
sabotaging the proposed Six-District Purchase. Conse¬
of
Notwithstanding that: (1) the vast majority of the
of
ill-timed and ill-fated merger scheme of
the Washington Water Power
During the past few months there have been vari¬
ous
tion from-and to the Governor of-the
people
common
inducement for the merger
an
even
similar nature have been used
a
ington Water Power's
as
which has not
"balloon" the market price
such stock appear attractive to
Congressional delega¬
part as follows:
can
know about.
the
in
a
development—a rate increase
plored the feasibility of
State of
Washington Water Power-who
presently be ruined by this ill-conceived,
a
sound, sen¬
sible, concrete offer you already well
excess
ance
INVESTIGATION
STOCK¬
"ox" which is being
gored. It is you-not the stockholders of
jects this "booby trap"
bound to be
seems
unquestionably
Gorge
to "inflate"
necessary
regulatory commission
members of the
(c) instigating
PUGET
other
the long and
interests, Puget's stockholders would be
or
underwrit¬
an
RUIN
yet been authorized by regulatory authorities and
.
approvals and of surviving the extensive
telegram,
by confusing, intimidating
finance the Six-District acquisition by
of the
Cabinet
by public
It is your
neces¬
fits derived from the accelerated amortization of
in
GOVERNMENT
sabotage the Six-Dis¬
large part of the cost of Washington Water Power's
litigation which
CAN
The extent to which the substantial tax bene¬
2.
separate actions.)
would
working with4
nuisance suits.
any
properties
presently under condemnation in 12
instituted
to
are
attempting to block the formation of
about half of its distribution
Consequently, before
SCHEME
HOLDERS.
coercing Puget's stockholders and others—(b)
ing
(All of Puget's major hydro-plants and
stockholder and
in¬
utility companies
by (a) seeking to prevent the
District Purchase offer
Puget did not accept their purchase
offer, they would immediately proceed
tortuous road of
an
following
two-thirds stockholder acceptance of the Six-
sary
of
even
the
WASHINGTON WATER POWER MERGER
the
stated, in exceedingly
blunt language, that if the stockholders
could
answers to
The extent to which electric
1.
the Six Districts
are
ways
sabotage the Six-District Purchase.
be Condemned!"
letter dated
a
of
consequences
questions.
SIX-DISTRICTS SAY:
or
of New
apparently attempting in various
vestigation to determine the
"Sell
Washington
group
by purely selfish
to
nothing-would presently be calamitous.
It would bring about what
Puget has
-
are
by
a
production—creating unemployment and other¬
wise
York investment bankers actuated
The
proposal—(3)
curtailing indus¬
now
been approved
even
of the present declared
as
scheme is not
by regulatory commissions!
nor
favor of the Six-District Purchase
merger
a
set
for October 27,
simply confirms the
to
and
to throw
has
a
all
the
the
proposed
rumors
earmarks
a
yours,
merger
previously
of
Very sincerely
re¬
capricious
PUGET SOUND POWER & LIGHT CO.
"monkey wrench" into the machinery
last ditch attempt to
block the consummation of
the Six-District Purchase. Such
be calamitous for
an
eventuality would
Puget's stockholders.
VM
ouu-<\
President
7
8
The Commercial and Financial Chronicle
(1524)
Motors,
Inc.,
Continental
Motors Corp. and
.
.
Thursday, October 23, 1952
.
Sperry Corpo¬
ration.
Twin Disc Clutch
Dealer-Broker Investment
Union Paeaifc Railroad
understood
is
the
that
(No.
EVENTS
109)—Smith,
Oct. 20-23, 1952
the following literature:
National
ciation
Airline
future—Goodbody
Industry—Analysis—of present and
& Co.
115
York
Notes
NSTA
Co., 120 Broadway, New
(Miami, Fla.)
Security Traders Asso¬
Convention
Oct. 23, 1952
5, N. Y.
Boston
Stocks—Comparison and analysis as of Sept. 30 of seven¬
New York City bank stocks—Laird, Bissell & Meeds,
Bank
120
Broadway,
York
New
Tax—Review—Ira
N. Y.
5,
Haupt
&
Co.,
Ill
Broadway, New
The
new
Arnold, Goldman, Sachs & Co., New York
City, President; Phillip J. Clark, Amos C. Sudler & Co., Denver,
First Vice-President; James B. Maguire, J. B. Maguire & Co., Inc.,
Mergers—Bulletin
on
possibilities—Sutro &
profit
Notes
on
Kentucky
Securities—Bulletin—Bankers
Bond
Club
linas
(Pinehurst, N. C.)
Council
pal
—
of
the Caro-
Carolina
North
—
dinner
Club.
Securities Dealers
officers of the National Security Traders Association
for 1953 will be Harry L.
Co., 407 Montgomery Street, San Francisco 4, Calif.
Local
Oct. 23-24, 1952
NATIONAL SECURITY TRADERS ASSOCIATION
York
6, N. Y.
Insurance
Roney
(Boston, Mass.)
Investment
at the Boston Yacht
benefit by modification of Excess Proiits
may
the
at
teen
Companies which
Field
Plaza Hotel.
Broadway, New York 6, N. Y.
Bank Stocks—Bulletin—Sutro Bros. &
Investment
In
Skelly Oil Co.
will he pleased
firms mentioned
send interested parties
to
Company—Bulletin
Barney & Co., 14 Wall Street, New York 5, N. Y. Also avail¬
able are memoranda on General Public Utilities Corp., and
Recommendations & Literature
It
COMING
Company—Analysis—Loewi & Co., 225 East
Milwaukee 2, Wis.
Mason Street,
Municipal
South Carolina Munici¬
Committee
Mid-Pines
joint
meeting
at
Inn.
Co., Inc., Kentucky Home L'fe Building, Louisville 2, Ky.
New
York
parison
Banks
—
New York
York
New
at
Trust
and
Companies—82nd quarterly
com¬
Oct. 24-27, 1952
New York Hansealic Corporation, 120 Broadway,
National
5, N. Y.
sociation
Stocks—Bulletin of comparative figures
City Bank
(Havana, Cuba)
Security
Traders
As¬
Convention tour.
Sept. 30, 1952—The First Boston Corporation, 100 Broad¬
Oct.
New York 5, N. Y.
way,
31,
Stocks—Comparative data for October—
Co., Inc, 70 Pine Street, New York 5, N. Y.
G. A. Saxton &
Western
sis of
Fall
Oil—Analysis—Ross. Knowles & Co.. 330 Bay Street,
Toronto
1, Ont., Canada. In the
Scurry Oils Limited.
same
bulletin is
a
1952-Nov. 2, 1952
(Hot Springs, Va.)
Public Utility Common
Meeting
of
Southeastern
Group of the Investment Bankers
brief analy¬
Association
of
America
The
at
Homestead.
*
*
*
Boeing Airplane Company—Analysis- -Dreyfus & Co., 50 Broad¬
way, New York 4, N. Y.
Harry L. Arnold
Phillip J. Clark
John W. Bunn
Nov. 19, 1952
Continental Can—Data in current issue of "Gleanings"—Francis
I. du Pont & Co., 1 Wall Street, New York 5, N. Y. Also in
same
James
issue is
Dole
Exchange
list of switch suggestions.
a
Engineering
Barth
Co.—Analysis—J.
Co.,
&
Nov. 30-Dec. 5, 1952
404
(Hollywood, Fla.)
Allen B. Du Mont Laboratories, Inc.—Comment—Paul H. Davis
& Co., 10 South La Salle Street, Chicago
Investment Bankers Association
3, 111. Also available
a
Stock
of
Firms annual meeting and election.
Montgomery Street, San Francisco 4, Calif.
is
(New York City)
Association
brief discussion
of
Mail
Order
Stocks
and
of
Annual Convention at the
Southern
Railway, and Gulf, Mobile & Ohio Railroad.
Holly¬
wood Beach Hotel.
%
General Dynamics
Corp.—Analysis—E. F. Hutton & Company,
Broadway, New York 6, N. Y. Also available is an analysis
of the Sperry Corpora!ion.
61
N. Y. Mim. Bondwomen
Grumman Aircraft Engineering Corp.—Memorandum—Auchin-
closs, Parker &
Also available
Educational
Redpath, 52 Wall Street, New York 5, N. Y.
is
a
memorandum
on
Van
Raalte Co.
Howard
Industries, Incorporated—Bulletin—Cole, Roadcap
Associates, 327 South La Salle Street, Chicago 4, 111.
James B.
Maguire
Lex
The
Winton A. Jackson
Jolley
&
Municipal
Club
New
of
Albert
Ludlow Manufacturing & Sales
Co.—Analysis—May & Gannon,
J.
the
of
Corporation
porated.
as
at
Nuclear Instrument & Chemical Corp.
—
Circular
—
will
have
first
the
First
Boston
the guest speaker
1952-53
educational
year,
nounced by Mrs.
it
meeting
Mildred R. John-
sen,
Airmotive Corporation—Analysis—Walter C. Kruge &
Co., Inc., 50 Broadway, New York 4, N. Y.
President
of
the
meeting
is
scheduled
Street, New York 4, N. Y.
The
club.
Thursday evening, Oct. 30
Co., 60 Beaver
an¬
was
first
Pacific
Pennsylvania Railroad—Analysis—H. Hentz &
the
of
Republic
Investment Company, Inc., 231 South La Salle
Street, Chicago
4.111.
York
Milloy, Assistant Vice-
President
Inc., 161 Devonshire Street, Boston 10, Mass. Also available
analyses of Shatterproof Glass Corp. and Tampax, Incor¬
are
Meeting
Bondwomen's
for
on
the
mezzanine floor of Chemical Bank
Plomb Tool Co.—Memorandum—Fewel &
& Trust Company,
Co., 453 South Spring
Street, Los Angeles 13, Calif.
at
5:30
30 Broad Street
p.m.
River
Brand Rice Mills, Inc. — Analysis
—Eppler, Guerin &
Turner, Reserve Loan Life Building, Dallas Texas.
Riverside
Cement
Industry—Lerner
Co.
Mass.
Royal Dutch Petroleum
&
Co.,
Walter G. Mason
Analysis and review of the Cement
Co., 10 Post Office Square, Boston 9,
T. M.
Lawrence S. Pulliam
Signode Steel Strapping
Boston, Second Vice-President; John W. Bunn, Stifel, Nicolaus &
Company, - Incorporated, St. Louis, Secretary, and Lex Jolley,
Johnson, Lane, Space & Co., Inc., Atlanta, Treasurer.
Newly elected to the Executive Council were Winton A. Jack¬
son, First Southwest Company, Dallas; Walter G. Mason, Scott,
Horner & Mason, Lynchburg, Va.; Lawrence S. Pulliam, Weeden
& Co., Los Angeles, and Thompson M. Wakeley, A. C. Allyn and
Company, Incorporated, Chicago.
!
Co.—Memorandum—Emanuel, Deetjen
Co.—Memorandum—Ames, Emerich &
Co., 105 South La Salle Street, Chicago 3, 111.
Southeastern Public Service—New
circular—Troster, Singer &
Co., 74 Trinity Place, New York 6, N. Y.
'
'
'w
_
Inc.—Memorandum—White, Weld & Co.,' 40 Wall
SECURITY TRADERS ASSOCIATION
Street, New York 5, N. Y. *
Thompson
Heller &
able
in
Products,
same
bulletin
OF NEW
Security Traders Association of New York
Inc.—Data
in
current
ing League standing
bulletin—Stanley
Co., 30 Pine Street, New York 5, N. Y. Also availthe
are
data
on
as
of Oct. 16, 1952
Team—
are as
»•
• - *
Rex
(STANY) Bowl¬
follows:
Points
Demaye, Whiting, O'Connor, Rappa, Seijas—
-
gan
Gersten, Krumholz, Rogers, Gold, Young
19
18
(Capt.), G. Montanye, Voccoli, Siegel, Reid, McGovern
15
(Capt.),
Greenberg,
Tisch,
Werkmeister,
Y.
(Capt.), Ghegan, Jacobs, Gannon, Cohen, Strauss
with
to
The
Financial
ORLEANS,
Chronicle)
La. —Harold
White, and
Sanford R. White have joined the
13
(Capt.), Frankel, Casper, Nieman, Bass, Krassowich
11
5 Point Club
200 Point Club
*.r,George Leone
NEW
W. Dowden, Kermit A.
14
Bean
.
connected
•
(Special
15
Krisam
Security Dealers Association
become
15
Lytle (Capt,), Growney, Craig, Fredericks, Bies, Lyons
N.
has
staff of Renyx, Field & Co., Inc.
Leinhard,
Lopato
Trinity Place, New York 6, N. Y.
Chronicle)
19
(Capt.), Smith, Valentine, Meyer, Farrell, Brown
Mewing (Capt.), Bradley, Weseman, Hunt, Gronick, Huff
Members:
Financial
With Renyx Field Co.
20
Leone
74
Goodbody Co.
Street.
25
Burian
Troster, Singer & Co.
The
26
Meyer (Capt.), Kaiser, Swenson, Frankel, Wechsler, Barker
Request
to
Second Avenue.
Goodbody & Co., 1 North La Salle
Goodman
Serlen (Capt.),
on
Chronicle)
joined the staff of
Merrick, 22
Now With
-
New Circular
Financial
CHICAGO, 111.—William D. Bur-
Hunter (Capt.), Klein, Weissman, Sullivan, Murphy, Searight
Southeastern Public Service
The
F. Howard has
YORK
*
to
MATEO, Calif.—Benjamin
(Special
Murphy (Capt.), Manson, D. Montanye, O'Mara, Pollack, Gavin
7% Income and Growth
SAN
-
Willys-Overland
Donadio (Capt.),
For
Rex Merrick Adds
(Special
120 Broadway, New York 5, N. Y.
Technicolor
Wakeley
—
&
>
211
Hoy Meyer
Joins Leo Schoenbrun
(Special
LOS
to
The
Financial
L. Schoenbrun has
of
Leo
Chronicle)
ANGELES, Calif.—Richard
joined the staff
Schoenbrun,
^wood Boulevard.
1385
West-
Nsmber 5162
Volume 176
.
.
.
The Commercial and Financial Chronicle
/
j
(1525) " 9
/
fa*
in
line with .Moody's averages of
yields for Aaa and BAA bonds.
t
that this
There
be
to the
selective because there
more
or
We
-
in
are
money
and
rates. Because intermediate fluetuations
it
is
are
real
next
have
we
people
distinguish
thej
turning poin^f
all
tell
D.
n
i
^
.
/\
^
probably
about
two
years ago at the beginning of 1950.
Now the tightening of money and
are
the
evident.
very
time
present
banks
many
their
Federal
of
Reserve
a
Bank
be¬
this tightening of money
itself, and, in spite of several in¬
in
creases
is to
principal at maturity,
securities
will
we
give
are
no
us
'W
.
•
hardly an incompany which does not
to
of
cause
schedule
and
the
its
bond
commitments
This
pany.
be¬
tightness of invest-
able funds in the individual
chanical
is
the end
this
even
this
was
month.
I
perhaps
understand
large topic of corridor
a
discussion
Bankers
of the year,
the
at
American
Association
meeting in
last week. In this
Atlantic: City
tightening period, the government
has
ahead
defense
will
of
it
not
com¬
it
to
of securities.
the
tighten
This would of
market
artificial
course
further,
pro-
offsets
being
the
its
to
as
much
a
what
pass
aii
by
of
There
was
who
us
business for
we
Having
in
mind
its
on
been
and
you
book
able
that
have
been
book,
was
E
Savings Bonds but the change in
cause
any substantial increase in
purchase of E Bonds. Mutual savings
bank
interests rates have
it
will
the
real
market
value
sheet
rate
level
we
in
us
accounting.
I
of
certainly any
help
give them.
We
subscribe
through
gives
enable
4-^ rtV
TTa...
for
savings. The
-for
the
its
on
it
money
govern-
higher rates
pay
has
intermediate
borrowed
certificates
and notes and last week its 2%%
rate
14
for
months
money
was
the highest rate in 18 years.
Npw
New
Problems
problems
for
tor
M
—
ihis time 'I'd 'likrito raise
cluestion ~ whether'we can
this
rqgard-
market
"value
ciency brought about by
ditions.
sider
I
we
making
in
tirely
to
what
talking about.
missioner's
ing
for
se-.
entire
for each
company
varies
upon
depending
which
I
have
I
our
brought new problems—or if the
problems aren't new, at least we
for
in
and
practically
think
•
■
the present crop
utiyes.
For nearly two decades
until the recent turn
had
become
occurred,
accustomed
to
we
sag-
ging interest rates, increased market values, refundings and profits.
We
have
now
conditions
got
to
and
a
principles that
some
we ve
shelf.
To
set
trends, and
off
dust
different
of
weve
the
of
old
on
the
had
extent
that
of us
have
operated
differently,
we
have now again become long-term
"^Remarks
man
of
American
by
the
Life
any
Mr. Anthony,
Financial
a,
Section
Convention
at
chnirof
the
47th
An-
Chicago. 111./Oct. 10, 1952.
for
be
doing today. In¬
management
important that it
more
ffew
a
what
is
We
years.
is
now
has
can
been
effec¬
tively
energetically
use
opportunities.
of
the
Chicago Stock Brokers
same
if
have
we
did
we
while.
a
I
been
Elect New Officers
have
do
CHICAGO,
111.—At the annual
meeting of the Stock Brokers' As¬
not
careless,'
sociate? of Chicago the following
easY money tend to make people
forget certain well tested prin¬
term:
or
officers
perhaps
believe
it
that
do
not wish
pessimist
or
a
to
be
I do
_
President,
Merrill
prophet of doom.
to
■
/
■■
■■
'
Thomas
A.
Kava-
Paul
A.
Schroeder,
Lynch, Pierce, Fenner &
Beane; Secretary, John J. Markh
others,
Hornblower & Weeks; Treas-
,
„
urer> James
however, and there are a good
many people who are pretty pes•
elected for the 1953
naugh, Paul H. Davis & Co.; Vice-
considered
listen
were
President,
necessary to be concerned
.
'
_
D. Condrin, Harris,
Upham & Co.
/
"V
This announcement is not
offer to sell or a solicitation of an offer
offering is made only by the Prospectus.
an
The
the in-
to
buy these securities.
'
$20,000,000
Carolina "Power &
pacific Power and Light Company
gage
bonds.
sold
to
Power
yield
The Duquesnes
were
First Mortgage Bonds, 3Vi%o Series due 1982
yield 3%%; the Pacific
Lights were sold to
and
3.65%.
Both
but
the
30-year
were
'
Light Company
each sold new issues of first mott-
Duquesnes
.iSh
0:
Dated October 1, 1952
Due October
J j 1982
are
>53%,
Moody
Price 101.505% and accrued interest
The yield spread was
It just s0 happens that five
ago in the summer of 1947
both of these two companies sold
years
That
was
a
was
not
the
spread of
low
.41%.
point
The
Prospectus may be obtained in any State in which this announcement is circulatedfrom only such
of the undersigned and other dealers as may lawfully offer thesejecurities in such State.
„
This
in
the
spread for in the year 1950, only
two
years
ago,
Duquesne
sold
bonds
to
pubiic at a' 2.64%
while only four months'
return,
earlier, Pacific Power and Light
bad soid jts bonds to yield 2.88%.
In
other words, that spread
of
has
or
now
better
a
%
of 1%
become
than
two years
ago
spread of .53%,
M>%. While this is
comparison
SALOMON
BROS.
&.
HUTZLER
DICK &,
MERLE-SMITH
SCHOELLKOPF, HUTTON &. POMEROY, INC.
GREGORY & SON
INCORPORATED
VAN
ALSTYNE NOEL CORPORATION
WEEDEN
&
CO.
COURTS &. CO.
INCORPORATED
STERN
BROTHERS &, CO.
BLUNT
ELLIS &. SIMMONS
a
between
two companies
reason
HALSEY, STUART & CO. INC.
the
bonds
selected
for
of
,
new ISSUeS OH the
Same
,
day. it
FIRST OF
IS
MICHIGAN
CORPORATION
SCHWABACHER &, CO.
no
except the coincidence of
.
nual Meeting,
ought to
•
were;"
we
ago
ening of the spread between best
.24%
%
the
way
*
and
new
for
conditions.
need
.
the
years
decide
doing
were
but I <?o .say that a long period of
eas.Y
investment conditions and
a
in-
us
two
carry
same
time
think
me
that
I
...
the
ever
for this reserve. Some of
select \■ • • > •
30-year bonds and my own comproblems pany bought some of each of
these
they are jssues.
The
Duquesnes at that
to a large part of time were sold at 2.69%
and the
of financial exec- Pacific Power and
Light at 3.10%.
these
long
a
.
with those principles just then.
point
discussing
than
more
ml
uhangSd con.ditions 1 a™."ot Predicting dire economic
been
0
dicate
makes
times
different
circumstances.
1
it
of
health
should
we
we
and
ago
doing
greater
'
J
ciples
business,
and
the implication
individual
i.!
is not
implications in this rul-
the*
years
evidences
economic
our
say
There
reserve.
interesting
been
bad
been
a
Then
whether what
question as to life insurance com¬
panies and what would happen-
inter-
haVe
what
exercise more investment
discretion.
We should not hold
back but should
it
vpry
ruling for
valuation
many
I
just
different
mean.
thing that caused deposits to
should be something othei
than a temporary strike.
Frankly
I refer to the Com-
new
much
we
factor
{briefly for it is '{closely,
case
a
this
on
in my office
that in his
me
amount
an
I
operations an en-,
factor.
I should like investmentwise
new
comment
through
our
drop
of
financial
curity
to
us
our
because there are more issues to
choose from, we should also think
vestment
in
J
had
as
the
con¬
all
only
getting
a
money, that
much money
as
to
real-
not
question of what would happen if
defi¬
must
are
our
up
very
we used to seem to have to invest,
and that we can be more selective
anticipated. This
required quite a few adjustments
to be made and
it
brought tnt
bankers
realistically up to the
the
dis-
face
should
don't have
-We
the
I believe it's the
situation
We
be
is
in interest rate is the wid-
bonds,
insurance companies this has
haven't had
notice
com-
this
should
we
changed
we
1
coun¬
must
we
believe
on
than
decisions.
are
than,,
A concomitant result of
crease
rated BAA.
life
time when
the
event,
I
and
for caution.
we
4 1
A
new con¬
believe
fact
this
re-
us
Pacific Power and Lights
the financial officers of
time
that*'
an
a
for Caution
any
rated Aaa by Moody while the
Financial
financial
unicers
To
fealists
which
parently
without reservations^.
However, at
involving them,
a program
Time
in
But
should
insurance
was
that
Flora, this afternoon will have
something to say about that.
experience during the steel strike.
The banks lost deposits and
ap-
to
reported
running out of purchasing
No doubt our friend, Carl
are
power.
larger return
life
of
newsbroadcast
a
was
istically.
very recently told
city they had had
balance
our
Some
problems
many
Pittsburgh who
great
these theories wholeheartedly and
1irifL/Ml4
the
almost
choice,
believe
try
work
companies,
change in innot
it
problem
might
totals
the
which
recognition by the insurance commissioners
that
the
valuation,
of amortized value is that
market
quality
and
medium
quality
increased,
and
although bonds. This was
brought home to
partly due to tax reasons, it is me very
clearly about two weeks
an' indication of
changed condi- ago when on the same
day the
tions and affects the competitive
Duquesne Light Company and the
market
har(i
all recognize .that
a
great step
forward has been achieved in the
is
2ft% to 3% less than
Market
him.
said that the people of this
excellent job.
an
are
can
been
ment has had to
Sherwir.
principles of investment
which
the rate has not been sufficient to:
it
for
by
Let me bring up one more
poand below this average.
tential problem which the
changed
The whole theory of life insur-.
status, especially the lower marance
investment and the principle ket values, brings. A banker from
in
gives us much more
for the play of management;
some
value
used for market value, it is prob¬
can
years
had,
room
Series
for
room
have
has- in-
Treasury
rate
good
very
more
that
for
placements,
with
agree
caught
ear
my
involved. I am sure
they would
welcome any suggestions you have
less
amortized
many industrials
securities that are di¬
other
rect
2.0%
or
and
wetwined- with
will
time which
a
have
few
a
member when it
wider
bonds
wm take and what bonds
and
Already
have
we
selection
em-
ployed.
creased
and
^e-
funding of of buying nearly everything that
deficits which came along. Far from being bad,
sell new issues the new condition is in
my opinion
vided it is allowed to react without
value.
municipals
our
gre^t
a
the
spending
force
Today
and j ^n0w
reported in
was
to
day he'll be right.
On
going
through my kitchen 10 days ago,
widely known prognosticator had
headed
now
Badger, has done
Since the Financial Section last
problem,
but
it
does
the changed conditions.' met we have had injected into
point up
utives
oi
few
ation problem of fire and
casualty
j believe there is
have
past
next
panies is different from the valu-
_1
now
the
for
choice.
surance
in
this group of companies today are
probably 4 to 5% below book
buy bonds that with individual companies above
rate, bankers are now
talking about another increase in Now a Wider Selection of Securithe prime rate and except it beties for Insurance Companies
fore
schedules
statement
significance for
purchases
great
borrowing from
are
cause
official
than
as
are
A.J.1
the
course
missioners
all bonds
of
to
other
in
the
value
terest
our
follow
at the present time in
trying U
work out with the insurance corn-
fluctuations due
ago,
At
issues
new
are
Many of the
buying today
have
we
in
and
com-
underpriced* so that
sell, by and large our
now
it
way
operation of it.
formerly headed by Fred Hubbei.
the
x
curities for the purpose of getting
income each six months when
a
MA
its effects
in¬
our
Anthony
this time that the turning point in
; I
interest rates
came
quite some
time
large
prices.
been
Right here ia Chicago,
the individual who
is Montgomery Ward,, has been
expecting a bad depression for
some
years—although he appar¬
ently can't get many of his exec¬
instance,
months with great care. The Cornmittee on Valuation of Securities
no
At
major
simistic.
for
-
is
value.
than
1
should
developments
tne
book value
our
due and
Julian
w1
Certainly
where
have
reasonably sure that we
want to keep for
many years, and
we are
getting back to. the prin¬
ciple that we really do buy se¬
ward look can
can
secu-
a
attractive
been
problem
back¬
most
longer
no
Obviously,
there
they will
■unimportant
changes. Only
a
can
long-
a
turn in
a
more
stances
of
rates from the
•by
at
Although
di-
or
"rection
month.
ties
a
change in
"level
buy
under¬
writers have to bring out securi-
with
certainty
-
We
bonds
as
others
every-
(representing 77% of
industry assets), the total market
we
don't particularly
for, but which the market
might appraise at a higher figure
dis¬
tinguish
bond.
of
great
statement
our
"tech-
a
That is this:
value
as
as
fine;
However, I think we should all
study this matter even more care-
search staff
we
expect to make
is set up and the
result
^
care
possible at the
to
term
when
Values
panies used in ihe series of studies
T;™
rvT
i
by Jim O'Leary's investment re¬
continually occurring, rity which
never
"time
investors
look at
end of 1951 for the 18
against lower market values.
reserves
period of tightening
stiffening
interest
a
to
problem.
market
Holds, however, changed situation should be viewed
realistically and now is time for caution. Discusses desirability
of
-
i
„r
and
longer
from.
J**
.
little
fully
nical"
issues to choose
are more
another
which
this change
in rate has
brought about and which we tend
mar¬
impact of rising interest
rates on insurance companies. Points
out, in addition to receiv¬
ing a larger return on investment, insurance companies now
can
is
sometimes
In reviewing recent changes in the
money and investment
ket, Mr. Anthony calls attention
,
Higher Rates and Market
By JULIAN D. ANTHONY*
President, The Columbian National Life Insurance Company
is
reserve
don't like it and nearly
body finds fault with the
/
0
October 22, 1952
MULLANEY, WELLS & COMPANY
SINGER, DEANE &, SCRIBNER
,
The Commercial and Financial Chronicle
10
.
.
Thursday, October 23, 1952
.
(1526)
Automobile Industry's
Role in Business Outlook
the top
comes
below the peaks of
way
of Economic Advisers
great deal of the blame
placed on shortage demand that
levels has been
and dealers are a
trends, Dr. Nourse cau¬
tions, however, the auto industry cannot of itself create pros¬
perity, but must be adjusted to other influences in the econ¬
omy. Says business skies are bright, but finds problems ahead
Asserting, in this
auto manufacturers
age,
Holds
streets,
year.
and third owners.
next
year
is
There
old
goes
"As
Maine, so
the na¬
for say ing,
case
"As
the
goes
for
movement
dustry, so goes
of
nation."
is
This
and
bile
maker
Edwin G. Nourse
and what
to
automo¬
is
do
fail
very important prime
determining
whether
a
in
factor
if
and dealer do
hear
or
we
nature
more
on
new
dangers
million
cars
more
even
Lewis and Harry Moses do not up¬
the
For
to
closer
as
to 6 million
than
to
seem
longer
5
or
have
to
me
be
road-building programs can
developed.
in
con-
r.ates> or w^o are operating
inefficient farm units.
Public
•
.
Enterprise
..
...
_ _
.
,
industry,
automobile
the
not "the whole show."
life is
It behooves
remember that economic
two-way street. The auto¬
industry cannot of itself
to
you
are
a
mobile
In snite of the nnstahilizine
In spite of the unstabiiuing
feet
recent
the
of
tlement
ef
et-
set
coal-wage
the
and
probable conse¬
of coal and steel price in¬
quences
gently but vigorously adjusted to
public
well
as
Let
the economy,
in
influences
other
as
private.
take
therefore
us
a
quick
general business out¬
look which creates the environ¬
look at the
must
dealer
bile
planning
done
that,
cases"
to
do
automo¬
his thinking
1953.
Having
"get down to
for
we
as
the
which
within
ment
and
can
factors
which
pecu¬
liarly affect your business.
almost
an
unprece¬
of unanimity among
economists, businessmen, and gov¬
ernment officials today that—even
if
candidate
"wrong"
the
on
favorable
forces
economic activity which
for
good
very
next
nine
gets
Nov. 4—there is a mo¬
of
mentum
and
over
with
along
pressure
Too
our
,,
farm
is to
be
turn
prices within
a
fairly narrow range upward or
downward makes a pretty favor¬
stability
of
I
understand
that
the
has been one of un¬
usually steady prices in the usedcar market, and
I take it that all
year
These
now
Expansible
near as
is
sphere. This
issue
most
of
citizens
as
group
as
is
the
of
importance
practical
us
sort of double-
a
that
as
well
as
ut¬
all
to
to your
private
enterprise
a
today.
using
how
this
IVIarket
as
this
be done in
can
manner.
As
orderly
merchandisers,
.
,
an
to
find
the
it
is
best
y°ur' • Junction
Sources' of supply and to find and/
or. develop the best demand possiblg an<J
as
brjng {hem tQgether
flexible
basis
and
as
economical
on
a
This requires
that you be given the fullest op¬
portunity for private enterprise
within the limits of regulations as
as
to
me
my
second
address
Used
O.,
by Dr. Nourse before lhe
Car Dealers Association,
Oct.
17,
1952.
,
.
or
as
nicipal, county and State agencies
returning from the trend
to big government into which we
—thus
drifted
for
the
few
last
decades.
have
this
a
car—or
a
second
From
car.
point of view, where does the
most
expansible part of the
ket lie?
I think the
answer
of
mar-
to this
lower prices for
already said that I
latest
(Special
r®turn to the free market which
we. believe, on the basis of expcrience, has been a major factor
ln
national progress.
find it
can
ques¬
price
increases.
It
or
create it.
for
those
the
business, but they
who
who
really
to
McNellis
with
Financial
The
KANSAS
CITY, Mo.
Chronicle)
Maurice
—
become
has
associated
Fitch, North
Barret,
Co.,
&
1006 Baltimore Avenue, members
of the Midwest Stock Exchange.
Mr. McNellis was formerly Mis-,
souri representative for Zahner &
Company.
f
^
Alton Gumbiner Joins
George K. Baum & Go.
(Special
are
keep
not
are
the
good at
the
ones
wheels
of
The
Gumbiner
with
Financial
CITY,
has
Chronicle)
Mo.
become
.
Alton
—
associated
George K. Baum & Company,
1016 Baltimore Avenue. Mr. Gum¬
biner
was
formerly resident
White
for
ager
prior thereto
Evans &
&
man¬
Company, and
with McDonald
was
Co.
,
(
Joins Dean Witter Co.
The smart
so
to
KANSAS
(Special
and nimble boys make a stiff pace
cars.
the
Barret, Fitch, North
both
that is
possible.
to
The
Financial
PORTLAND,
Chronicle)
Oreg.
William
M. Cronin has joined the
Dean
Witter
&
Co.,
staff of
Equitable
Building.
Finally,
terprise
annually
into
the
kind
Harling
have
J.
A.
at 52
to
a
as
E.
Ritchie,
Eleanor
and
formed
Edward
C.
J.
Ritchie
the
partnership of
&^Co. with offices
Wall Street, New York
City,
Ritchie
continue
the
investment
of J. A. Ritchie
busi¬
Co., Inc.
to giving public en-
chance.
Roadbuilding
F. L. Putman Adds
(Special
to
The
Financial
Chronicle)
\1
BOSTON, Mass.—Bruce Bowden
is
now
nam
&
connected
with
F.
L.
Put¬
Company, Inc., 77 Franklin
get back to the period of real not, by taxing and bonding them--Street, members
competition which surely lies selves, provided a rapidly expand- Stock Exchange.
of we
peacetime economy that we seem
Partnership Formed
Robert
ness
omy.
has always been a public enterprise in America, which apprecithe nation's totals
of gross na¬ "form sheet."
it is easy to pass on the costs, of ated the importance of quick and
tional product and of disposable
inefficiency and even "phantom" economical communication.
The
First, then, is the question of
personal income. The employment how
costs.
Prices
closer
to
income automobile age would have been
many new cars can be fed
into the automobile market in '53 trends can become a reality when greatly retarded if the people had
♦An
levy
burden
can.
you
for honest dealing and competitive
Practice that apply to all businessthe finan- racn. This, in my judgment, is not
cial ability as well as the willing- Possible with the dead but unness
or
wishfulness of people to buried controls which still clog the
brings
They won't the bulk of the market lies. If, as
For the next few months, we gjve you infallible "tips," but they, we
like
to
believe, * efficiency,
have every prospect of seeing new along with study of the general technological and managerial, has
monthly highs in the FRB index factors that I discussed a moment been
advancing,
the
opposite
of industrial production
and in ago
will
give
you .a
reliable should be true. During inflation,
National
that
tax
three
ance
Cleveland,
urge
this
a
market,
of
to
as
possible to the people who
directly affected—that is, mu¬
have
businessmen.
Giving
are
economics
think
I
so
enterprise vigorously in its
I want to speak briefly will be argued that wage increases business turning and the pace of
special issues that seem and higher prices for materials technical and commercial progress
to me of timely significance.
I make this necessary—that it is an brisk. They should not be retarded
surface of this near-term prosper¬
believe that you would do well to inevitable accompaniment of a pe¬ either by government controls or
ity. I am not altogether sure of keep your eye on these factors. As riod of inflation. But this is only by "price maintenance" or "fair
our
ability or willingness as a new
developments occur during partly true. As I read the statis¬ trade" laws designed to protect the
people to meet the problems that the months and
Accepting competition,
years ahead, you
tics, the price of a car in the pop¬ laggards.
will confront us as '53 unfolds and
ranges
has gone up more however stiff, not running away
can, by. pondering their meaning ular
develops into '54. But that is be¬ in
your individual corner of the than the net incomes of the great from it, is the indispensable conyond the scope of your program
market, get all the economic guid- middle and working classes where dition of arhigh-production econ-
self, I have some real misgivings
as to
what lies beneath the fair
And
of
proper
good
in
communities
we
„
Sales of automobiles,
I have
to the automobile
the
they live.
control
tion the economic wisdom of some
Coming
is
term)
brought about
old and new, depend on
Automobile Market
the
in
which
it
and
brought about, I shall re¬
An
used
Factors in the
responsibilities
only by giving private enterprise
a full chance and also using public
unfavoraSe'
,
exist for
of course, permits
Special
both
are
people
question is pretty clear. It lies in
A free market means a cominerchandisers better incomes for the lower-paid petitive market—that is, an oprather
than
gamblers
will
be part of our labor force and in portunity of the businessman to
pleased to see a continuation of lower prices for new cars- -which, seek a legitimate profit where he
Three
we
which devolve peculiarly upon our
are
this situation.
we
good facilities for
as
children and youth per capita
had 20 or 30 years ago.
our
as
a
in
that
this land of popular education
,
you
is
It
thought
as
presently.
point.
This
.
question
This
plant.
facilities.
shocking
well
uniavoraDie
01
or
,
conditions the
that
them.
To
to
For my¬
tavorable
favorable
tne
the
expanding and
and
road
and
bea"hy competitive" market calls Maurice McNellis With
price, and
entertain
....
the
street
our
do not have
some hope that, whichever candi¬
parking — municipal, com¬
date wins, these costly, annoying,
mercial, and private. These pro¬
ineffective, and unnecessary re¬
grams will furnish the key to the
straints will be liquidated as fast
fo
of
applies also in the field
school
our
rather
street
of abundant
industrial
modernized
for pretty
good business thereafter.
caution,
supplies from
will make
business
months
business
competitive
past
dented degree
elected
during this fiscal year is largely
offset by consumer resistance and
manager.
The Business Skies Are Bright
is
up
of
viding freeways, and facilitating materials controls.
or e ending of wage,
arfpnllafe
I
provision of adequate off
to
building
expan¬
sense
And how fast and
the
able environment for the business
I.
There
of the deficit which is
the
to
that
it looks as though we
riddle of how much ownership and
create prosperous business condi¬
might keep our price structure on
use of automobiles the public will
tions for the country. While it is a
pretty even keel.
The infla¬
have the appetite for within the
a big contributory factor, its own
tionary
pressure
of
the
Wage
limits of their purchasing power.'
policies and actions, to be eco¬ "Stimulation" Board and the Of¬
PeoDle^ill'buv^^'Uim^oDorTion'
nomically sound, must be intelli¬ fice of Price "Stimulation" and
creases,
ernization
...
prosperity that is created by forces set the apple cart, it looks as how skillfully can States and mu¬ chance to restore and maintain
outside their own control.
act
in
constructing
though really dangerous inflation nicipalities
streets, opening bottlenecks, proAt the same time, of course, you may be "contained."
of
applies
that
good politics (in the best
economy will be;
barreled
future, the
Federal and
run
issue here is how fast
State
ciple
My third .point is that a conregis-tinuation of a prosperous automofuture, blle market within a prosperous
much the best of the argument.
country have awakend to the dan¬
the wave of
-
who estimate the
market
car
new
ning down, or running wild, or ger— even if the Administration
running sweetly in a middle area has not. Some safeguarding steps
between those two extremes. They have been taken
and", if John L.
do not simply ride on
For the short-run
the statisticians
out of the pic¬
Congress and the
the
But
ture.
as a
sales beyond the
in total automobile
trations.
little bit afield at this point
that the same prin¬
suggest
...
highway, street, and parking'
facilities to handle further
in_.
creases
and
pressed by the
are
differential"
"Southern
replacement basis is the ability of,
Inflation¬
even
brackets, who
imporlimitar
more
tangible
car
I go a
the purchasing power of those
who are now in our lower wage
view .of
our
not yet really
are
business, in general, will be run¬
and
elements
ary
or
tion
been speaking of.
Perhaps you will indulge me if
facilities
perhaps
tant
was as
did not wake up.
is
What
creep
1951, I
have just
another'.industry through strengthening of
the.used-car market by improving
realistic
a
these
go
is
your influence;
toward giving the
buyers' attitudes on price.
car
upward
the
in
be
manufacturer
substan¬
a
cut in expendi¬
other, directions
any
sion, rebuilding, and general mod¬
as
be exerted
can
every
loud as anyone
in sounding the alarm against the
dangers of a final inflationary bust
automotive
age,
the
will
except
story,
prosperous,
of
already field for support of the automobile
too,
that,
But
made.
and
continue
to
those
of
last
the
even
rather than anything
inflation.
In 195G
runaway
a
like
an
we
think that further
to
son
prices,
automobile in¬
the
even
is
into the highway, street,
parking modernization that I
and
prices have now been ad- same degree to these people, many
Personally, I doubt the of whom live in small towns and
wisdom of further
mark-ups or, rural areas. There is an enormous
that
But if the auto¬
in
must
respec¬
us
expect it.
slice
tures
vanced.
possible
seems
an
tial
a
burdens, and
their
industry
active
streets
in
promising
are
pro¬
demanding
tax
our
the
both
civilian
all
are
ways
may
mobile
which
about
month,
but these highs are mostly only
fractions of a point or decimals of
a per cent, and there is good rea¬
good
fairly
a
it
see
may
all-time highs
new
make
could
I
we
As
think
I
over¬
tighter
employment situation when the
October report comes out.
that
we
in
waste
candidates
tive
The bottleneck of
city
We
reduction of
both
a
tne
and
grams.
against con- which was discussed above does
resistance at the figures to not apply in
anything like the
sumer
ordinary
any
But
standards.
an
political
tion."
by
employment
saying:
goes
inflationary
constitutes
—
beyond.
millions.on
In other words,
and
unproductive
of
sales are bumping
car
into
of dollars
military
lower brackets of our workers, ru-
question that, at present produc-'ral and urban.
tion rates of 5 million or less, new' main highways
and
State,
up
of new cars to exploit to the full the possibil-
There can be little
of the market.
through
come
military build¬
and have squandered hundreds
depends not merely on the pro- jties of this age of individual or
ductive capacity of our factories family transportation, it is necesbut also on the absorptive power sary to raise the income of the
and improvement of
highways and parking facilities.
will
expenditures of
return for used
the health of the
even
which
of
receipts—Federal,
lions
go
But in fact the flow
that the figures showed a new low of un¬
automobile
business outlook for employment in September of 1.4
1953
depends primarily on the million people. That is only 2.3%
general business outlook for the of the civilian labor force and
and
good
auto¬
more,
safe, anj pleas¬
billions of dollars,
local. We have been pouring bil-
a
be trite to say
It would
tax
partic-
you
and
more
requires
most
final point on
effective market
6
will depend on expansion
much
ant
ditions
healthy competitive market?
a
of
back to the pleasant con- used car market depends in no
of a booming market of small measure on the existence
million or even 6.7 million cars 0f a good demand among second
ily
as:
chance to restore and maintain
removed,
were
use
mobiles possible,
extent ularly as used car dealers. The
controls as maximum absorption of new cars
assume that, if depends in no small measure on
the auto- getting a
mobile manufacturers could read- cars and
these
Lhe
ahead,
providing the facilities that make
to some
It is easy to
well.
For the years just
one
concerns
to
trujxs
ana
on.
credit
and
price
on
(1) how many new cars can be
fed into market; (2) what is financial ability and willingness
of public to buy, and (3) will private enterprise be given a
industry, such
in auto
materials, and
of
prime factor in determining business
1959. A
Now there is
for these this matter of
busses
the
for
network
roads
and
run
facturer s mind the existence and
the intensity of "consumer resistance."
still more in recent
the new car figure has
been considerably reduced;
n fact,
and
months,
hard
autos
are
,the larger the supply that can help in getting this adjustment
into your hands, in recent made by burning in on the manu-
years,
NOURSE*
By EDWIN G.
Former Chairman, Council
that
cars
more
ing
Obviously, the ahead of us—a little sooner or a
poured in at little later. As I said before, you
developing.
be
to
of the Boston
"
.
>
Volume 176
Number 5162
.
.
.
i
The Commercial and Financial Chronicle
(1527)
"We Must
Debt
Accept the National
Permanent Fixture"
as a
/jeopardizing the national security.
Our. policy must, I feel, be to payas-we-go just as large a share of
Jthe cost of defense as is possible.
Like many other members of the
.Congress, I have always cast
By HON. WRIGHT PATMAN*
my
votes
U. S. Congressman from Texas
with
the
objective
of
a
balanced budget in mind. During
*.
•
,
the
Chairman, Subcommittee on Monetary Policy of
Congressional Committee on the Economic
Report
Joint
last
Congress,
recommendations
Committee
Rep. Patman reviews changes in field of finance in last three
decades and the impact of closer
relationship between bank-
following
of
the
on
the
Repeats recommendations contained in
recent report of his
Subcommittee, and argues that all banks,
regardless of membership in Federal Reserve, should be sub¬
one's
cut
method
from
of
Economic
reckoning,
was
which
cit
will
in
peak
Federal Reserve should carry National
debt, since this debt
expected
fiscal
is to remain permanent.
be
caused
defense
to
come
by
the
expenditures
in
the
current
hope
The
In
ones.
to
since I
years
last
spoke to
been
have
group
eventful
saying that, let
add
that
I
do
not
corollary to this rise in
hasten
me
propose
to
dwell here
the
upon
gi
tions
tra¬
.
Monetary
de¬
Policy,
Second
Only to
'
Fiscal
But I
want
Policy
to
talk
commercial banks
from $17.3 billion to
to
furtherance of
you
billion.
The
situation
various
other events
which
bring the problems of monetary policy is so important, it is na¬
policy and the management of the tural that the Congressional Joint
i
volved
n
-
in
us
World War II,
n,or upon
the
impact
the
public debt
dent and cold-
of
had
had
Instead,
I
Wright
pur¬
posely
to
questions
situation
itself
is
this
discuss
with
observed
long
before he,
himself, had become an enthusiast
for currency management:
way
than
society
I
to
economic
law
the
on
is
.
not
able
one
have
of
the
ing the free enterprise system, in¬
timately associated as their activi¬
ties are with the over-all supply
of
we
I
have
in the
talked
to
can
witnessed
you
a
of living
cost
we
years,
income
rise
In
seen
annual
rate
almost
been
national
Field
of
many
such
some
Act
to
its
for
termed
substan¬
expenses
or
in¬
agencies
or
able
am
of
course
most
Reserve
upon
are
smaller
are
the
of
to
hear
in
happy,to say that in
the Subcommittee's
the
country
the
Federal
Non-members
the
on
relates
its.
at
ted
variety
It
of
requirements
reserve
varied that they are almost im¬
possible to summarize. In one of
so
an
Subcommittee
States
with
non-member
ments
at
made
banks,
should
-
neighboring States there is
statutory reserve requirement
no
at
be
fe.ll; at the other
—which
Federal
serves
Reserve banks.
dual
a
which
When
compete
cial
banking. I
fear
do
this
of
find
not
threat
ments
a
of
ing Act
the
banks
for
the
national
restrain the
by the Bank¬
such
of 1935 made it possible
banking system better to
group
of
terms
of
to
ence
best
interests
of
the State-chartered
to
more
by Rep. Patman
Bankers
Association,
address
doing
the
two
Moines, Iowa, Oct. 22, 1952.
types
business,
reserve
require¬
national ef¬
tion
to
banks, half of them in
numbers, are in a posi¬
get
national
insti¬
interest, endeavor to
inflationary pressures
out
from
under
this
policy and to the extent
their
I
was
impressed,
as
we
con-
eluded the taking of testimony, by
there
were
not substantial areas in
which differences of opinion
per¬
State
authorities.
The
really
(1) that since non-member banks
es¬
represent
only 15% of the total
deposits, the proportion is so small
sential elements of the dual bank¬
ing
system
would
thus
be
un¬
that it
altered.
this
to
questionable
that the dual system
banking might be jeopardized,
there is the overriding interest of
argument
is
of.
the nation
as a
tenance
I
not
of
are
disregarded,
of
sound
economic
important
direct
ceivably,
monetary conditions at all times.
think,
be
This announcement is neither
an
offer to sell
nor a
Debentures. The offer is made,
and
price
the government
policy and responsibility
In
as
economic
response
has
to
an
sta¬
as some
solicitation of
Continued
an
on
offer to buy any of these
only by the Prospectus.
demand, the gov¬
all
its
and
Sinking Fund Debentures
al¬
undertaken
utilize
Dated October 1, 1952
r'<
Due October 1, 1967
by that
own
plans,
resources
to
and
maintain
conditions
will
promote
maximum
prise
a
Price 100% and Accrued Interest
free competitive enter¬
system.
In
the
furtherance
of this
aim, monetary policy must
become a major tool second
only
perhaps to fiscal policy, meaning
by
that
taxation
and
Copies of the Prospectus
may be obtained from only such of the undersigned as may legally
offer these Debentures in compliance with the securities laws of the respective States. -
budgetary
management.
-
MORGAN STANLEY & CO.
CLARK, DODGE & CO.
people will agree that
whatever expenditures are needed
to attain those ends must be made.
before
Personally, I have always favored
a
blanced Federal budget when¬
ever
that
can
be attained without
LEE HIGGINSON CORPORATION
WERTHEIM & CO.
October 22, 1952.
or
con¬
have advocated,
Benson and Hedges
Fifteen Year 4V2%
(2)
anyway.
controls
$3,000,000
for
or
Now, faced with the alternatives
whole in the main¬
sist among the experts,
but these,
only to be expected.
can
has to argue that the general
credit control function of reserves
one
Opposed
Stabilization
a
Des
as
same
other
of
Responsibility
war,
functions,
tions of
than
As
are,
those currently induced
by
defense expenditures, one
as
heavy
the
the
of
the
has important
country and has accomplished that
at no significant loss of independ¬
serve
laws
When,
for
example,
the
monetary authorities, acting in
deposit insurance to
non-member banks
In
require¬
fects.
convincing argument, how¬
Everyone will admit that the
extension
States.
the
State
re¬
widely
probably
this difference in
that
makes
different
the
as
varies
lower than
required of member banks.
those
has
of
traditional part of
a
counted
however,
know,
you
threat to the
banking system,
the
for
ments
from
comes
the
general,
American system of commer¬
become such
our
in it
be
may
likewise
among
The objection most commonly
raised against the single system of
see
are
require¬
as
type of assets—vault cash, securi¬
ties, balances with correspondents
lary, they would, of course, be
given equal access to loans at the
requirements
least
high as those
prescribed for member banks. The
subject to the same set of
requirements. As a corol¬
reserve
reserve
extreme
percentage
employment, production, and pur¬
chasing power under the condi¬
of Finance
mid-1952.
hold
Half of the banks in the Uni¬
States are thus subject to a
While,,
create
people then thought
high as we could
billion
than
average
banks and
member
only about 15% of the total depos¬
opin¬
Subcommit¬
our
as
in
System.
it had been that of
upon
of
at
$58
Iowa
were
banks
one-
which
as
billion
*An
the
Some
the
members
of
v
$1.3 billion,
universal
most
-
$182
the
in¬
$33 billion, is now 8
In the field of
budgetary man¬
times that, at around $260 billion.
Deposits of all banks in the United agement, the issues seem fairly
clear. We must, first of
all, main¬
States
have likewise risen with
tain the national defense and the
these other dynamic factors in our
national security, and I believe
economy.
They have risen from that most
manage
we
of them. I
Gov¬
year
guaranteed
matters
ernment
same
about
was
or
States
government
to
and
bilization.
time, great changes
have been going on in the field
of
finance.
The
national
debt,
which
by
clared its
in
to
of actual goods
has almost exactly
in
them
business,
of
not
cluding, that is, both member and
numerous
government.
moreover, in the Employment
Act of 1946, recognized and de¬
product
Changes
loans
Since the
doubled.
At the
of
in
as
has,
incredible; the gross
services
and
be
sense
Economic
the past 15
the national
today
guaranteed
1950, the last
Government
nearly
$290
billion.
Even at
constant
prices, that is, even in real, phsical terms, our achievement has
an
one
index or, as
billion
consulted
experts in banking and
well
half
are
before taxes.
1937,
rise of 90%
$65
from
of
onerous
size, locality, and such things.
At the present time, about one-
the
banks.
to
requirements
circumstances
after'
made
non-member
as
less
doubt there will
no
sense
be
directs,
stands
your
ever.
as
of
not
it
reserve
money
control the
means
credit,
headed by
that all banks
which accept demand deposits, in¬
very
we
this income from gov¬
iterr,s
was
just about
equivalent to their total net profit
people like to express it, a
shrinkage in the purchasing power
of the
dollar to about half its
value.
have
in
session
of
ef¬
are
the
ernment
some
previous
last
business,
hardly
in
submitted
the
detailed
income
dramatized. "
better
Since
credit,
and
money
be
earlier
today that
that
to
to
we
the Constitution
as
volume
effective
an
the
third of the total earnings.
of course,
the banks had
The role of bankers in preserv¬
•
loans
or
amounted
diagnose."
to
and
by the United
sured
million
a
was
of
and
require¬
ments
Congress. In the work of the Sub¬
the
supply of
the volume of credit.
government
tions and
a manner
in
man
the
days
several
you
ion even among this
group,
to the question of reserve
committee
of. public
tially riskless government obliga¬
de¬
of
side
struction, and does it in
which
Committee
influence
money and
in
forces of
all the hidden
our
supply,
banks in similar
like
be substantial differences of
those who
the
what a wide area of agreement in
earnings figures
the field of monetary policy and
are
available, the total current
debt management we found among
earnings of insured commercial
banks amounted to $3.9 billion, students of the subject generally.
That is not to say, of course, that
while their earnings on what
may
debauch the currency. The process
engages
actions
which
.
of
Re¬
outstanding has had the ef¬
person, but from many others we
bringing government and
received testimony in response to
the
banking system closer and
specific questions which we asked
closer, insofar as their respective
ernment. In
tainly right. There is no subtler,
no surer means of overturning the
basis
Economic
these questions. The renort of
last
would
study and deliberation. The
important
one,
and
one
of
sured
to destroy the
capitalist system was to debauch
the currency
Lenin was cer¬
existing
have
stabilization
volume
monetary
past year, as you
doubtless know, I was Chairman
of a Subcommittee dealing with
debt
fect
States
"Lenin is said to have declared
.
the
stability
general control.
//During
30's,
to
Since
the
on
I
have
Just how close this
column. As John Maynard Keynes
.
economic
in
crease
of
once
best
the
time
a
•
spirit,
Subcommittee
which
to
are
should
principal recommendations which
our
we
reason
Bank Reserve Requirements
In
If
monetary policy—if
fectively to control
extra lending capacity
work we received the active as¬ tutions
as, compared; to
national
relationship sistance of well over two hundred institutions. There is, moreover, frustrate the national aims.
In order to defend the present
banking practical working bankers nothing in the proposal for a
system is may be suggested by the
throughout the country. Needless single standard of reserves that discrimination between member
large extent to which commercial to
would alter the charter-granting and non-member banks as to the
say, their help was extremely
banks
today
rely for earnings valuable and greatly appreciated fights nor the
supervisory and ex¬ requirements for maintaining re¬
upon
obligations of the United by all members of our Committee. amination
responsibilities of the serves, one has to argue either
important in our struggle against
aggression, for inflation has been
characterized as the enemy's sixth
the
and
how¬
the tremendous wartime in¬
ever,
the
of
some
financial
that
for
economic
port should make an almost con¬
tinuous study of this subject of
and growth. In recent
years,
raised
by the impact of these
things upon our banking and fis¬
cal problems. I do this partly be¬
cause
of your special
interests.
I do it, also, because the economic
and
during
recovery
seemed
promoting
Patman
limit
myself
to the fore¬
evermore
growth.
Committee
monetary policy into the
background of our thinking as a
possible tool to be employed in
citizens.
shall
and
to
pushed
the lives of
on
our
been
monetary policy in stimu¬
lating
aggres¬
has
has
and
1929, coupled with the ineffective¬
inci¬
ness
sion
these
The financial crises of 1921
present
war
of
front.
that
Korean
force
•
Senator/ Douglas,
pri¬
marily of monetary policy, which,
"as I have
suggested, must become
have
;our
second
major tool
in
the
$70.8
by
gone
world
c
bank
posits and in the size of the gov¬
ernment
debt, the
holdings of
United States Government
obliga¬
can
whole.
a
tee, just
your
we
given, in
ultimately
a
working agreement which
will be the best for the
country as
was
year.
that
be'
reach
Re¬
the
discussion must
the
the
budget in the hope
of minimizing the
temporary defi¬
ject to Federal Reserve requirements. Holds much of inflation
in recent years has been due to credit
expansion, and holds
and
Joint
port, of which I am a member, the
/Congress effected substantial cuts
in the budget. Between $7 billion
and
$10
billion,
depending
on
ing and government.
The differences only
point up the
questions to which further study
11
page
31
The Commercial and Financial Chronicle
12
country's great economists and a
.
Thursday, October 23, 1952
.
Financial Editor,
washers,
escalator
thought
well
and fears." Says forecasters can¬
(3)
national defense was
expanding rapidly, it added to
payrolls.
It built up consumer
purchasing power. It encouraged
businessmen to expand plant. Not
And
move¬
The housing boom has lost
First,
housing starts
new
below their record
are
So long as
deflationary
a
as
add to de¬
may
sets in.
its zing.
thought.
This
if
down
work
clauses
up.
flation,
I question that mode
the country.
of
as
ment
As defense goes, so goes
outlook.
(3) end of housing boom; (4) end of industrial plant
families
new
not
being
rapidly as several years
We're now reacting to the
formed
ago.
as
Great
Depression.
1930s, there
During
the
fewer marriages
were
1
o
t
a n
(3)
o
so-
i
g
1
c a
I
document.
have
now
running
a
rec¬
ord,
year
and
year
how
in
out,
econ¬
omists
in¬
of
dustrial
cor¬
porations,
unions,
labor
banks, and
government
J. A.
Livingston
agencies
think
how
—
ample.
were
sion
ex¬
an
In May, 1946, economists
unanimously bullish.
You
remember
was
of
Here's
minds work.
their
the period.
Reconver¬
going nicely. Forecasts
unemployed
had
be unfounded. Every¬
optimistic. Then in Sep¬
8,000,000
proved to
was
one
October
and
tember
the
came
market crash!
stock
Forecasters Are Bearish
In
November
questionnaire
economists
the
They expected
si
I
like
i
wonder.
the
out
my
bearish.
were
postwar depres-
a
It
1920-21.
Do
stock
stock
sent
usual. This time
as
made
market,
the
does
or
influence
econ¬
Economists for
be
business tended
exceptionally bearish. They
feared the worst.
the deep
The memory of
losses back in the post¬
'20s and later in the
war
'30s
was
can move
depression
imbedded in their minds.
They projected their fears
Labor economists acted
opposite.
They tended to be the
bearish.
least
just the
the most
For
part,
optimistic about prices.
The expected rise in the cost of
they
were
their
was
So
arrive
we
at
after
recent instance of this
a
what
to
be short¬
rationing.
Maybe
age.
would go up.
after
happened
There'd
Harbor.
rushed
minds
Our
Korea.
back
Prices
Everyone rushed to
The government introduced
buy.
price controls and wage controls.
we forgot was that the war
What
in Korea
limited.
was
case,
chewed
We forgot,
tanks, guns
ammunition by the boatload.
we
other
In the
in
We're
.
.
up
.
definition:
project¬
or
ing one's personal hopes or fears.
you've made a forecast, you
After
set
about
like
compiling
evidence
to
it. You build up a case
lawyer.
You rationalize
support
a
projection.
Furthermore, I have recently
checked up on the results of the
your
the
from
States
United
They
in
the
weren't
omists
were
period.
postwar
good.
wrong
The
econ¬
seven
times
out of ten!
Do
a
me
to make
what
it
isn't quite so
record
it sounds.
Offhand, you'd think
that economists
at
least
flipped
half
a
bad
ought to be right
the
time.
If
you
coin you'd do that well
Actually, however, the chances
are
not
one
out
of two—not
50-
address by Mr. Livingston at the
Convention of the Kentucky-
Annual
Bankers
Association,
tucky, Oct. 21, 1952.
Louisville,
Ken¬
great industrial
Russia's steel capacity is
about
35,000,000 tons of ingots.
This country's at the end of the
will amount to 115,000,000 to
year,
We have three
120,000,000 tons.
Russia's
times
This
capacity.
country is not stockpiling
stockpiling ca¬
been building up
the plants. We've been installing
the machinery to turn out muni¬
We're
weapons.
We've
pacity.
full-scale
if
tions
why
ing
up
fast
steel,
we
as
why
we
war
develops.
haven't had
We're not chew¬
we
metal shortages.
or copper, or
first thought.
this
same
type
of
mass
The
common
assumption
is that defense soending will
late
Sumner
in
H.
1953
or
Slichter.
in
level
1954.
one
of
constitute
total
and
amazing
used in
are
wants the easy-to-handle
To
install
posal units in kitchens
quires
complete
a
That
job.
product.
dishwasher-and-dis-
means
construction
or
often
re¬
rehabilitation
major household
renovation
ahead.
Not only
that, but the ranch-type
house—everything on one floor—
to
stair-climbing, has become
save
major
a
development
in
resi¬
dential construction. Builders have
found
a
to make old homes
way
obsolete.
That will
cial demand for
create
a
spe¬
homes, especially
among older people.
In
July,
had
we
a
supposed
was
tremendous shortages
finished
in
and
Such
of steel and
also
mentum
record
the
on
are
your
replied:
publisher
price
I
planning to start
new building?"
you
plant
of steel
steel
comes
"When
down."
"You
answered:
man
the
the
of the
year
Dollar.
of the
Recovery
We're talked
the
equipment
and
so
2.12
2.76
dollar.
will
dollar
go
4.20
35
6.21
6.79
We
American
businessmen
up
ply.
have
had
a
20-month
New
New
worn-out washing Nov.
vac¬
cleaners with postwar mod¬
have
wait
to
for
re¬
&
Co.,
30%.
We've had
since
early
a
August
market ever
of
declining
tops and bottoms.
Could
it be that all this weak¬
this lack of confidence, is an
anticipation
of the
decline
so
people have been talking
many
about?
1
Alfred
see
right
character
Robert C. Hall to
partnership in the firm. Mr. Aver¬
ell is manager of the bond trading
and
(1) Declining commodity prices.
point
out,
inventories
are
particularly low. They .amount
Dr.
not
the
to about $69 billion.
That's
a
the
next
say
decline
in
it would be
McGee Staff
(Special to The Financial Chronicle)
CLEVELAND, Ohio
A.
is
Baker
short and swift—something in be¬
McGhee
tween what
now
—
William
affiliated
with
2587
East
55th Street.
It
1949.
don't
I
But
happened in 1937 and
would
be
a
want
I
That
lot.
the
face
of
&
Company,
shake-out.
leave
to
the
impression that deflation is Amer¬
would
be
history.
to
Even
fly
as
talk, two great resurgent forces
at work in the country. We're
Edward W. Snitz Opens
HASTINGS-ON-HUDSON, N.Y%
Spitz is engaging in
—Edward W.
the securities business from offices
at 737 Broadway.
are
headed into
They are:
They cause businessmen to reduce
inventories—to buy less.
And, I
might
of
business, I would
in
it, five important de¬
now.
Street,
Averell, Edward I. Du
B.
Moulin,
And if I had to guess the
gram.
ica's
Deflationary Influences
As I
Wall
York
have
The stock market too has been
weak.
36
City, members of the
Stock
Exchange, on
will admit Gustavo Ajo,
York
prices. Sen¬ placement demand to develop.
dropped
department.
Thus, it seems to me that dis¬
Industrial
raw
materials,
inflationary forces are at work in
Agricultural prices, 19%.
Joins
the middle of a large defense pro¬
commodities
27%.
ness,
Bache
the
machines, refrigerators, and
We'll
Admit New Partners
People
are on
before.
ever
sup¬
decline in commodity
sitive
prior there¬
Bache & Go. to
in their purchases. They
More automobiles
els.
and
pretty well
longer have great gaps in
no
uum
now
Mr.
with
formerly
was
to with Drexel & Co.
52%
consumers
are
replaced
cents.
$27.92
$18.52
TOTAL
have
to 54 cents or
Reynolds
9
than
up
an¬
Stephen C. Reynolds,
with the
Lebenthal & Co., and
35
3.12
road
the
100%
Transportation
coming
and
bankers,
investment
City,
nounced that
New York office of the firm.
% Change
$14.17
Well, maybe the
dollar,
50-cent
$7.07
Commercial
of caught
long
Incorpo¬
Co.,
Rollins &
Blair,
rated; 44 Wall Street, New York
Jr. has become associated
Utilities
(5)
deteriorating dollar, of the
52-cent
55
Here's
Today
—(Billions—
Industrial
not have to wait too long."
predict that 1953 is going to
be
mo¬
Korea
Outlay
Reynolds Jr. Is
With Blair, Rollins
de¬
a
gain
Before
The
may
once
could
outlays since Korea:
Type of
work
that
it
rapidly.
of
S. C.
overcapacity, but
suggests
starts
vul¬
in fa¬
increase
an
cline
it
paper
"When
Boston Stock Ex¬
changes. Mr. Keegan was formerly
President of Investment Research
outlook.
Here's where the economy is
steel strike,
to produce
Last week, the
president of a steel company said
to the publisher of a large news¬
the
plant
Corporation of Boston.
business
the
cilities suggests
products.
of
new
equipment.
nerable.
which
half
on
Here, then, is the volatile ele¬
pening
now.
than
more
expenditures
ment
as
flationary influences are at work
reasoning, mass assumption, could
lead us into error in forecasting
off
a
expected. It's being an¬
ticipated.
And maybe it's hap¬
velop
That's
didn't have inflation in
is look¬
slump in 1954,
they're doing something about it.
Therefore, the slump won't de¬
to
ahead
ing
lead so
1951.
today.
*An
58th
Russia
point.
And
by the law of averages.
because
potential of the U. S.
One statistic will help make the
That's
forecast?
That
as
still want
you
That's
does not have the
,
forecasts
oranges
inci¬
an
it's
Ahead
submit that if everybody
The
with
race
arms
an
Russia, not at war. And an arms
race means something different in
munition.
a
As
frozen orange juice than are sold
in fruit markets.
The housewife
New York
We had
excuse
Forecasting is the art
reduced demand
a
clearners.
more
clothes
freezers,
With
du Pont, Homsey Co.
ing for higher wages.
sentatives of workers.
No Slump
three-sided
a
means in Russia.
To fight a war,
for argu¬
Russia
must
stockpile
actual
They were
projecting their hopes—as repre¬ weapons—tanks, guns, planes, am¬
living
means
dishwashers,
Thomas Keegan
and
of the worst.
It
sideways.
need
They were conditioned to fears also, that rearming for a possible
war against Russia is entirely dif¬
of
depression.
And, as I look
ferent from rearming for an actual
back, their reaction to the stock
war
against the Nazis.
In one
market- was
like
a
conditioned
reflex.
1955.
and
Result:
for
commentary,
are
ways
for homes, refrigerators, washing
And more important,
obsoles¬
machines, furnishing, and the like. cence is fast at work in industry.
coin.
Further, defense is no longer But,
boom
in
industrial
interestingly
enough,
it The
plant
Actually, the economists came expanding rapidly.
Outlays are doesn't necessarily mean fewer building now reaching a peak is
out with
a
percentage of 0.291. running at a rate of about $48,- cribs. People who do get married bound to create a secondary wave
They were still below what chance 000,000,000 a year. Maybe they'll these days have more children of
building.
Companies
that
would
have done—.333.
So it's go up to $55,000,000,000. The big than the husbands and wives of haven't
got the latest equipment
necessary to try to find out what
gain is behind us. And there's no 10 and 20 years ago.
will find, in the buyer's markets
made them go wrong.
telling what the new Administra¬
(4) Even more important, in¬ to come, that they can't compete
From
studying the data, I'd tion will do about expenditures. dustrial plant expansion is prob¬ on price. They'll have to install
With all the talk of economy and
say they went wrong chiefly be¬
ably on the way down.
Before up-to-date machinery to stay in
cause they were all too conscious
tax cuts, it's likely that outlays
Korea,
American business was business.
of what happened after 1918. They will
be
restrained
rather than spending about
What I see ahead isn't a major
$18 billion an¬
could not get the 1920-21 depres¬ stimulated. Indeed, Russia's latest
nually on plant and equipment. depression at all. It's a letdown
sion out of their minds.
They switchabout suggests that inter¬ The defense boom boomed that after seven
years of almost un
were victims of their own expertnational tension will relax, that 50%. This rise in
plant expansion interrupted economic expansion.
we'll feel more secure and less
ness, their own profession.
suggests a glacier-like force guar¬ It's a warning, too: Not to expect
They were so busy crawling on anxious to build up a big stock¬ anteeing a
high level of business what everybody expects. Even as
their
hands and knees
looking pile of munitions. We'll even fig¬
activity for months and months. you expect it, you, yourself, and
under
the
bed
for
a
postwar ure to use some plans for civilian But the
everybody like you are acting to
very rapidity of the rise
bogeyman that they couldn't see products, thus adding to a greatly is its own
warning. Such outlays prevent the very things you ex¬
good business all around them enlarged peactime productive ca¬
go down rapidly too, as 1920, '29 pect.
when they were standing up.
pacity.
and '37 illustrated.
There's another aspect to this.
This fact, this possibility, has
You've already thought of what
Economists are no different from
I'm
going to say.
Here is Dr. been concealed by the overall
anyone
else. They're caught up Slichter suggesting that business statistics.
Plant
expansion has
by waves of thinking, by fads, you will slide off in 1954. Leo
Cherne, been anything but even.
Thus,
might say.
They can mo more of the Research Institute of Amer¬
outlays of public utilities and
(Special to The Financial Chronicle)
escape the economic environment!
ica, has said that the economy will transportation companies have in¬
BOSTON, Mass. — Thomas S.
they live in than a women can be vulnerable in 18 to 24 months. creased
only 35%. But outlays of
Keegan
has
become
associated
escape a new style.
We're all af¬ The
Department of Commerce has industrial enterprises — manufac¬
with du Pont, Homsey & Company,
fected by economic faddism.
instituted a study of what to do turing and mining companies —
31 Milk Street, members of the
when defense slides off.
Well, I have doubled. And such outlays
Economic Faddism
Pearl
omists?
to
you'd
1954,
product.
the total national
me
economists influence
market
It
steel, aluminum, and
make
It can come down.
So
im¬
an
port
of
(2)
it has be¬
but
come
i
!
only did they build new
demand.
that
housework.
demands
vacuum
dental
1950 peak.
are
plants to and fewer births. And, as a result,
other today we have fewer persons of
raw materials, but they increased
marriageable age. Hence, fewer
When
For
years
I've
been keeping 50—but one out of three.
capacity for manufacturing tanks, marriages. Korea also was a fac¬
tabs
on
economic
forecasters. you make a forecast, you have to
guns, and airplanes.
They were tor. It hastened some marriages.
Twice a year I send them ques¬ bear three possibilities in mind:
aided by fast amortization.
But This lower marriage rate is likely
tionnaires.
It started as a
(1) Business can go up.
defense amounts to only 15% of to last
jour¬
through 1953,
stunt,
simplify
may
is the con¬
trolling influence in the business
their economic environment. Ascribes present
expansion; and (5) end of backlog in consumer
nalistic
to
industry today
They have to find
Increased
The dominant mode of
bear¬
ishness to fear of let-up in defense spending, but holds "slump
won't develop as expected," and "1953 is going to be the year
of the Recovery of the Dollar." Lists as deflationary influ¬
ences:
(1) declining commodity prices; (2) probable lower
wages;
The
in
women
married.
decline in commodity
especially in food prices,
result in lower wages. These
(2)
the
prices,
depression when de¬
spending decreased in 1954.
today is that defense
Commenting on current bearishness of business forecasters,
Philadelphia financial writer characterizes forecasting as "art
not escape
billion from the post-
high.
fense
"Bulletin"
The Philadelphia
of projecting personal hopes
Korean
of checking a
A. LIVINGSTON*
By J.
of only $1
provocative thinker, even went so
far as to discuss ways and means
What of the Business Outlook?
c
.
(1528)
a
period of mechani¬
zation of the home,
becoming
more
and
married
especiallv the
probl^ is
increasingly acu+<^
as
The
kitchen.
servant
more
women,
work in ind,,f,4-rv.
morp
NEW
to
Slay ton
The
Fin»ncial
ORLEANS.
dina, Jr.,
women.
drop It's significant that
With Slayfo-» & Co.
(Special
Chronicle)
La.—S.
Giar-
is now ™nnected with
& Com nan v. Inc., 1803
th*r unif Broadway.
Volume 176
Number 5162
.
.
The Commercial and Financial Chronicle
.
(1529)
of under
comes
To Invest Abroad—We Must
It
President of the New York
self
abroad,
first make it easier
domestic investment curbs, such
excessive
high margin
risk involved in
nation to invest abroad
nomic health and
can
Calls attention
rates.
depends both
There is
in
areas
have
is
doubt
is
there
the
world
fitting
As
money
indus¬
our
large
liquid
resources.
As this money was used, up, it was
replaced
with
earnings retained
from several years of record pros¬
perity.
Against this background
that
had and still
we
con¬
have
the Excess
Profits Tax which makes it prof¬
itable for corporations
to avoid
ing that capi¬
equity
financing.
Profits
after
taxes have backed down from the
—
not, let me
stress, through
levels
of
immediate
business
so
post
-
war
there is less to plow back,
years;
motives of
any
altruism—but
at
is
almost
forced
to
finance
simply
cause
be¬
foreign
be
itable
debt that business contracts
prof¬
a
G.
Keith
Funston
opera¬
tion. True, the by-products of such
investments may be of great
sig¬
nificance to our own
economy and
to the nation in which
funds are
invested but. the fundamental and
motivating
truth
is
that
by the general public is un¬
dertaken primarily as a means of
gaining income
or
increasing capi¬
tal.
,
The
ability of this nation
abroad
the
sources,
part
any
of
to in¬
its
of
resources
today
long time to
come—today is mortgaged and to¬
morrow
is
mortgaged.
On the
will be around for
hand, equity capital is not
mortgage; business does not go
into
re¬
its
citi¬
debt
American
of
line
ability of funds for venture capi¬
Never in history has world
prosperity, world freedom, been
tal.
or
of
of
Federal
regulations, the
and
rules
tive
investments
closely and directly with
along the
vestment
of
the
and
man
of
sense
ment.
now
4
being
We
of the
more
Now
vestments
Many
make
in
look
a
foreign
of
American
produc¬
be
pat¬
design—in¬
savings of
mass
overseas
last
22 obstacles to
—including
quotas,
of
by
of
multiple
tax
heartening increase since the
determination.
the total
While
put it this
me
to
invest
invest first
at
to
first
make
home.
I
mind
home.
invest
easy
it
no
that
you
To make
invest
than
more
this
it
must
we
to
easy
we
at
re¬
country
was
discovered, its frontiers pushed to
Pacific, its riches exploited, by
investment or speculation, which¬
the
ever
see
you
to
essential
no
tween
want
them.
emphasize.
I
difference be¬
Today
we
are
So
If
move¬
enforcement
fore.
it
Ours is not
has
never
fervently it
a
static economy;
been,
never
and
I
will be.
needs
of
of the
domestic
our
people
or
This
one
the
and
announcement is not
of
$27.5 billion for this
Ten
years
our
outlay
known
perils.
change,
the
The
thrown
ahead
of
this
on
would
should
seem
that
to
there
and
$6.1
which
be
national
demand
that
just
policy
discriminatory
are
governmental
trace
everything
possible be done to facilitate rais¬
ing the necessary funds.
What's Needed at Home?
Now,
what
is
being
regula¬
back
to
plished in this country to
encour¬
or
vestment
The
*An
address
"Herald
City,
by
of
Tribune"
Oct. 20,
Mr.
the
Funston
Annual
Forum,
at
New
New
1952.
the
their
through
and
in
money
the
owner¬
domestic
Mrs.
an
com¬
great
a
of
rtteans
majority of
means
countries.
of
of economy,
the
cure
American
listed
on
the
fit
the
with extraordinary
the plain fact is
that today in America ownership
of our productive
enterprises is
But
already spread
people
and,
among
millions of
willing,
among
government
intend
we
to
many
ownership
spread
millions.
more
plete
refutation
that
of
the
wealthy few at the
proletarian
the
capital
in
Marxian
inevitably
hands
expense
in¬
a
when
are
said
earlier
to invest
abroad,
I
first
to
first
make
of
com¬
New
York
at
that
gains
tax,
single deterrents to
environment
capital.
wealth
for
a
primarily
the
—77%
of
capital
gains
the
any¬
home—to
invest
abroad,
home.
it
easy
to
to
&.
&.
*
MERLE-SMITH
|
SON
NEW
R. W. PRESSPRICH
YORK
&
CO.
HANSEATIC CORPORATION
INCORPORATED
WM. E. POLLOCK
&,
CO., INC.
AUCHINCLOSS, PARKER &,
in¬
HIRSCH
&,
REDPATH
STERN
CO.
F. S. SMITHERS & CO.
BACHE & CO.
BROTHERS &. CO.
BALL, BURGE &
J. C. BRADFORD
KRAUS
&
in¬
impor¬
healthy
equity
FIRST OF
THE
MICHIGAN
losses
IRA
ROBINSON-HUMPHREY COMPANY, INC.
JULIEN
COLLINS &.
COMPANY
HAUPT & CO.
CO.
HELLER, BRUCE & CO.
ADAMS &. PECK
BYRD BROTHERS
MULLANEY, WELLS & COMPANY
which
man
of
PACIFIC
corporation
people
CORPORATION
who
have
take
in¬
October 23, 1952
NORTHWEST COMPANY
SCHWABACHER
&.
CO.
we
it
must
invest
buy these securities.
lawfully offer these securities in such State.
if
make
we
en¬
for
law
the
great
or
a
raising
This is not
or
DICK
a
must in¬
we
State in which this announcement is circulated from only such
as may
of
of the
mass.
Refunding Mortgage Bonds
any
And
in that concept we have the com¬
It is that concept I had in mind
offer to sell or a solicitation of an offer
offering is made only by the Prospectus.
be obtained in
of
Rus¬
economy
precision.
select
can
number
se¬
concept
to
seems
vest
they
huge
by
profits."
outworn
capitalism
sian
used by them to
highest
Stalin's
Finally,
militarization
and
wars
HALSEY, STUART & CO. INC.
GREGORY
the
given country by
enslavement and sys¬
a
tematic plundering of the peoples
other
countries,
especially
.
investment with
flavor,
the
of the undersigned and other dealers
the
power,
of the most
one
York
-York
of
population of
speculation.
capital
stance, is
may
capi¬
tation, ruination and impoverish¬
considered
was
its motive
and
concerns
Second Session
it
thing which savored of free
tant
accom¬
when
terprise
Prospectus
as
of exploi¬
dark
Discriminatory Laws
Then
The
Ex¬
BEAR, STEARNS &, CO.
period
It
maximum
means
Price 101.541% a?id accrued interest
huge job
a
legitimate sport to condemn
obvious
of
profits by
us.
sums of new
as
And
Dated October 1, 1952
Lack
Stock
billion. Our domestic need for vast
vious.
"Assurance
talist
Series J, VA%, due October 1, 1982
industry
generally have
light
some
laws
equity capital is ob¬
First and
securities
business
tions
was
approximately
Virginia Electric and Power Company
couple of words descriptive
nothing; for others investment
speculation conjures up un¬
alone.
year
the total
ago
formulated
follows:
$20,000,000
peo¬
of
second half of 1952—a total
contemporary capitalism could
be
a
$14.3 billion on
plant and equipment in the
new
de¬
law
thing. For too many
investment process is
area, but we still have
sum
than
an
The
misinforma¬
jointly
record
and
a
an¬
is
He
economic
indus¬
built that wall?
and
several weeks ago
that
American business will spend a
traits
basic
wall.
a
the Securities & Ex¬
change Commission and the De¬
partment of Commerce reported
economy,
foreign
war,
into
American
information
still
less
risk
shares
Mr.
from
help satisfy the
Yet between the two
What has
of
Just to give you an idea
capital
hope
will
panies
equity capital. A
of liquid savings is in
deficiency.
tion for
be¬
the
easy
of
evident ability to
ment-speculation
risk
situations.
it
not
am
vestor want
tion.
ple. On the one side, there is a
plain deficiency on the other, an
in
course,
panies with foreign operations.
laws, and outright expropria¬
new
mass
there is
re¬
instances of foreign
make
of
line—out¬
the hands of millions of
of
ever
been
headlong
run
paradox.
try needs
great
of
on
discussion.
our
chief
"The
mands
of
to
with
affairs
so,
we
other
greater need of funds for invest¬
than
has
in my opinion —
when compared with our national
investment potential.
must
we
abroad,
need
If
way:
abroad,
there
still out of
is
rageously
Let
0?
aware,
entailing
abroad—but
ship
rates,
good
froifr, Com¬
that
bility which we must meet with
pride, with humility—and with
First at Home
pertinent
doctrine
remittance
their
back
economic
concentrates
are
tions.
potential
perfectly clear
saying that Amer¬
private capital will not flow
ican
import
of
statement
recent
and
vestors
exchange
discriminatory
political
it
paragraph
Stalin's
that hundreds of thousands of in¬
profits, control of capital
ments,
brief
study
or
chance
pretty
a
getting
abroad in large sums in the years
to come.
Far from it.
I surmise
foreign investment
limitation
are
domestic
me
that I
citizens
A
the
export
of
National
investment.
year
on
invest¬
be very tempting—but
the possibility that
perfectly
am
let
enterprises.
nations
interest
a
certain
seemingly
have
gone out of their way to dampen
the
A
rade
goes
that there
in¬
at
The
overseas.
equities
take
direct
may
I
attractive
people.
let's
a
not see his money again
long, long time—if at all.
program
to
investor,
it
our
to
can
with
for
order
investor
time, to want to take
ward may
are
most
he
more
be
may
average
suspect
a
investments
without
backward
ment
history to strengthen
in
the
ment
the added risk of
in
ownership
is
risk, the better he
the
keenest
I
see
of
intensive phases of self-examina¬
share
he
it.
expect
tion
our
risk
owners
the first
votes
Exchange
one
that
the
men
man¬
operations,
they'll seek it out—and they'll not
certainly the new shareowner
putting his money to work for
part of govern¬
the
at
risk
of
world.
en¬
Those
for profitable overseas
said:
enterprises,
the
in
chance
Canada
the
are
interest.
and
keener
a
some
by
brains
that when these
taxation
more
which
directed and
are
of
there
have
a
falling lamentably
goal.
The recent
Brookings Institution Survey of
share
ownership disclosed that
we
short
who
woman
will
undergoing
made
people.
But
of participation in the capi¬
business
system—just as
talistic
Nov.
aged
divi¬
It think it would be unrealistic
Industrial Conference Board listed
must
same
likes
deeper
raise
Our
the
to
on
are
small, but it's there nevertheless.
And
Exchange
companies
Can-
on
double
risk—the
a
to each individual
6,500,000 people with a
share in publicly-owned corpora¬
are
taking
and
calculate
each
not
earnings.
country's
investing.
The Stock Ex¬
change and industry believe that
widespread ownership will bring
sense
profits tax.
tax credit
lessen
corporate
own
discouraged
owner a
margin
does
When the average American in¬
vestor buys a share in one of our
of
must
owners.
business
operation.
been
Canada
exploiting nat¬
average American
actually
to
a
in¬
not
ural resources.
misinformation
information,
Canada
Can¬
does give favorable tax considera¬
tion to companies
re¬
in
the freedom and
prosperity of any
single nation. That is a responsi¬
Invest
of
does
excessive
excess
ade does give
goods
automobiles
an
dends
speculator.
have
requirements.
when
consumer
the
investor, the
structure
not
have
the
capital gains tax.
a
does
The buyer of
more
capital in a healthier
way—in other words, by
shares in business to an
duction
our
so
Re¬
in
takes
selling
ever-increasing number of invest¬
ors.
Our economy is a mass pro¬
economic health and
the avail¬
it
of its
more
sounder
terned
on
when
owners—share
zens, depends in the last analysis
on the state of our own
domestic
linked
of
unsympathetic
a
other
a
invest¬
ment
vest
itself by going into debt
truly staggering rate. Today
no problem.
But the
a
that debt is
investment
can
Federal
tax
clude
from
it
vacuum
the
taker,
ada's
margin
regulations govern¬
result
lack
unusually
me
tribute to fill¬
tal
no
say,
a
and
raising the
high
nation friendly
capital — a nation
venture
Stock
Canada, gaged in foreign operations.
a
which welcomes
frigerators?
Exchange.
age
to
has al¬
handful of notable
a
Our neighbor
example, is
risk
out
sale
as
,
on
And for
money
should
listed
the
has
private Amer¬
ican
to Ameri-
are
are
such
tries
need?
Most
corporations
emerged from World War II with
little
that
ing
little
a
there
eco¬
incalculable
almost
capital requirements.
there
our own
availability of risk capital. Points
little doubt that
many
which
state of
on
for
Board also retard the whole
seem
ability of this
companies operating abroad, whose shares
New York Stock
are
large degree of
to
he
are
exceptions.
any
shares in industry in America's
greatest corporations must pay at
least 75% in cash.
Doesn't that
home, points to
says
There
year.
tax.
a
investment process.
the Capital Gains Tax and
foreign investments, and
paid
requirements of
to invest
we are
to invest at
as
which
on
Discriminatingly
Exchange executive, asserting, if
we must
and
ready
Stock Exchange
per
penalizes
seeking to better him¬
investing money he has
by
serve
N. Y. Stock
$10,000
which
who is
earned
By G. KEITII FUNSTON*
f
law
a
man
Make It Easy to Invest at Home
t
is
13
at
14
The Commercial and Financial Chronicle
(1530)
LETTER
TO
EDITOR:
THE
and
takers
order
What Should Be Done to Stimulate WKStWl;.;
diverted
To Hold Forty-first Annual Convenlion
not
The
Maurice
only have the Funds
possible
speculation
into
Brokerage Business
Moes, of Erdman & Company, Members of the New
Exchange, suggests revamping of commission rate
structure and
Finan¬
cial Chronicle":
In
article
an
"Chronicle"
tent
with
various
the
in
the
Oct. 9, I was con¬
merely pointing to
that
causes
have
the
created
I
we
are
per¬
folly
to assist
our
who did
of
the
much
volume in the past of
active markets. We have succeeded
making the cost
of
terms
his
high, at least
so
thinking, and
we
tion and
dustry
continue
have
to
to
some
time.
I
his problem, that
see
costs
cover our
plus
small
a
profit in making a higher odd-lot
scale, we find ourselves in the
called
attention
to
was
live
with for
to
are
have
position of having made
to
the expanding
ful
interest of the
success¬
a
patient.
various
I
types
institu-
of
tional
not
am
charge
buyers
with
operation,
their
Maurice
N.
merely
Moes
his
ited
shares of
high
grade equities for
income and
long-term holding. The shrinking
speculative
lay
can
at
of the market
use
the
doorstep
we
high
of
high margins and an in¬
equitable commission system, plus
the ever-growing element of the
taxes,
Mutual Funds.
If
made,
American people would
we
be extremely quick to seek it out.
economic
Our
table
the
story
history
is
veri¬
a
speculations.
of
incentive
and
But
potential
gain
must be commensurate to the risk.
With
current
in
nessman
bracket
is
rates, the busi¬
even
moderate
a
loathe
short-term
if
tax
gain.
risk
to
tax
for
a
His speculation,
successful, only adds to his in¬
and thus raises him possibly
come
to
higher paying
a
short-term
loss
is
level.
tax
only
A
partially
deductible from
income, thus per¬
centage-wise his gain is small and
his possible loss large. Hence, we
in the business find ourselves with
a
dearth
of
short-term
specula¬
as
in
odd-lots.
costs, $20 per 100.
what
half
cost would be.
our
the
of
round
as
an
penalty.
He has
brokerage
many
volume.
If
market is
the commission problem one ave¬
that needs
that there must be much
feel
business to overhaul.
a
industry,
with
its
volume
available,
centive
a
much
very
than
currently
do
cannot
plant,
the
things
to attract and give in¬
necessary
the
to
public speculative
appetite, then we will surely find
the
years
houses.
bear
Today the average client is in¬
terested in long-term capital gains
der
liability. A situation is selected
for
six
months
positions
These
Some
be held for
may
may
longer.
or
result in
a
years.
very
cessful financial gain for the
tomer, but certainly the
tion
receive
we
is
suc¬
cus¬
remunera¬
limited.
very
will
help
amiss in
.
our
ness
to
give
a
discount, rebate,
or
betr
ter terms to a volume
buyer. A
purchaser of 50,000 yards of cloth
pays less per yard than the 1,000-
yard
109
customer.
A
jobber
refrigerators receives
discount
ten.
In
than
our
the
one
a
taking
higher
asking for
industry the
customer
buying a thousand shares of a
stock pays the same rate
per hun¬
dred as the 100-share
buyer.
should there not be
a
Why
commission
system whereby the customer giv¬
ing us the larger share of our rev¬
enue
be entitled to somewhat bet¬
ter treatment
not
a
charges and why
universally acceptable
method
who
on
of
may
rebate
use
the
speculative
to
a
customer
market
as
the
were
trol
from
from
the
conven¬
and
•
.
dent
united At u"esrSOn'
Co.,
.Carrol M. Shanks, President of
- Prudential
Insurance Com-
'
"
The
Broadway,
Oct.
20,
i
■
1952.
'
:
Halsey, Stuart Group
Offers Utility Bonds
Halsey,
and
Stuart
Co.< Inc.
&
and
(Oct.
yesterday
interest.
accrued
priced
3.43%.
to
The
addition
In
*
convention
the
to
fyl™nla Rf,!lroad lrom P,ttsb"r«h
attached to the New York special
" f1?11.
sessions, there will be two or three
-
associates
of America
nanv
Pittsburgh Special Car-This
caF wi»
operated via the Pennto Washington, where it will be
•
New York City,
been
yield
group
22)
meetings of the Board of Governors;
and most of the national
committees of the Association will
hold meetings
during the conventheir annual
a
t
...
?
.
*5
made
'
J*- _£?P™?a£?
wea^ Hldg., Pittsburgh 22, Pa.
Chicago Special Train — Reservations for the going trip (with
An open meeting of the Municipal the exception of the Cleveland,
Securities Committee will be held Detroit, and St. Louis special cars)
on Sunday afternoon.
should be made through Robert
"
With
the
exception
of
that A. Podesta, Cruttenden & Co., 209
tion and will present
reports at the convention sessions,
bonds
meeting, and possibly one or two
estimated
other committee meetings, it is not
The
an
award
won
Federal
the amount of credit
for
It
policing
used
was
So. La Salle Street, Chicago 4, 111.
Cleveland
Special
Car—Reser-
of
find
portunity to live
in
to be
If
an
will
I
do
not
wish
here either for
Funds,
be
an
tor
but I
to
or
do
make
case
a
believe
them
to
important contributing fac¬
in
the
activity.
selling
decline
of
speculative
They have succeeded in
approximately
$4
worth of their funds to the
They
in
growing
turn,
invest
figure,
in
billion
public.
this
the
cost
around
generating capacity and
for
ance
transmission
the
and
bal-
distri-
Association.
member firms,
a
now
out
among
and
into larger orders for
amount of firms.
a
selling
many
large and small, it
centralized
a
channeled
very
small
0The Funds
commission,
plus
placement of sizable orders.
ments
bonds
improvements..
redeemable
are
improvement fund
and
replacement
fund, at special redemption prices
also
are
redeemable
the
regular
orices
at
wav
.
104.31%
to
raneins
PnCeS
par.
rangmg
Carolina
Power
in
m
ensa^ed
engaged
They
par.
&
the
tne
from
generation
trans
generation, trans
sale
and
to
public of electric energy both
at retail and at wholesale in North
v
Carolina.
to
gages,
rr
i
It
also,en-
minor extent,
a
manufacture
and
in
the
distribution
of
gas and the distribution of water.
The
lenders
company
Seacrest
a
5C0
of
states,
336,000
has
electric
electric.
or
approximately
-
,.nnn
12,000
■
3,000 water
cus-
Operating
&
revenues
Light
ended
of
Co.
June
for
date an overflow attendance.
30,' 1952
12
ag-
.
Co
Penobscot
Mich.
Q
'
,
.7? J
?rin^
aho*Jld
J? ,,
?
ari7
c+nSr "C'o if
* ounn street; St.. L.ouis z, mo.
.
^
c
Transportation
Special
—
section flights have been arranged
between New York and Miami via
Eastern
for
Air
the
should
H.
Lines.
Reservations
special
section
flights
made
through
Harold
be
Sherburne, Bacon, Whiople &
Co.,
1
Wall
Street, New
York
5,
N. Y.
Return
T>p+Iirn
Train
p
1
„
be
1
Arrangements
m
a
made
n
nervation*?
at
Hollywood
Representatives of the railroads
,y from ,}he .?.xPerlence of r?" will be
at the Hollywood Beach
Hotel throughout the convention
to handIe
h reservations.
than two rooms at the Hollywood Beach Hotel and place their
more
a(jdit10nal
other
representatives
hotels.
It
should
the
at
be
noted
that this limitation does not
Chicago Analysts to
neces-
Hear at Luncheon
sari!y J?»ply that each member organization
least
one
will
room
Beach
Hotel, as
possible if the
be assured of at
CHICAGO, 111.—W. A. Patterthe Hollywood
that may not be son> President, and Curtis Barkes,
attendance
,a~ntaUves
Begch
.
HoteJ
a
Vice-President, of United Airlines,
Qn
is
ety to be held 0ct 23 in the Geor-
..
wm
travgl
indicating their hotel room
^ese fBps
kfrs>
take *he
•
the
Slips
proper
on
for
gian Room of Carson Pirie Scott
& Co.
num-
place of hotel registration. Slips
for
the Hollywood Beach Hotel
should be presented to the floor
Boye & Heine Formed
In New York
floor of that
the
Hollywood
at
the
front
desk
Hollywood Beach Hotel.
of
the
Slips for
City
William E. Boye, member of the
,
New York Stock' Exchange,
Max L.
and
Heine are" forming Boye
Seacrest Manor, the Surf Hotel,
&
presentedTarithn0frantS^desks
Street> New York Gity Both were
formerly partners in L. J. Mar-
gregated $46,317,414, gross income
the
$9,131,120 and net income $6,588,-
those
724.
turned
7
&
Detroit 26
If
mfjw 'I.™
Carolina- sonted
the
Aldinger
'
Ya
Beach Apartments should be pre-
..
months
Hotel,
having the convention special trains and
more
in will furnish passengers with slips
customers,
_
gas customeis and
Power
whereby
Surf
to 216 communities
population
both
made
the
and the Town House will also be
available if needed to accommo-
wQod
seivice
been
Manor,
tr°m cent years it will be necessary no
to
limit member organizations, to
Light Co. is
distribution
have
for; the Hollywood Beach Apartments,
the
for
or
pay
But
the
to
Hollywood Beach Hotel, arrange-
'
spread
addition
In
additions and
The
„,
"
bution facilities and miscellaneous
the
^on•
Bldg.
A*r
All reservations for hotel rooms
for, the convention must be made
through the Chicago office of the
quality, more seasoned securities. tomers, and the estimated total
But, whereas in the past, a part population served is in excess of clerk
of that huge amount would have
two
million
■
hotel.
been
conven-
tions for the going trip should be
made through Ralph Fordon For-
This fee will be $35 per per-
form.
ever¬
higher
tion.
of
other member
or
that of the-total amount, $40,000,000 will be spent for additional
the
against Mutual
his wife
and
000,000 in 1954. It is also estimated
op¬
a velvet
glove, now
Reduce margins to a
realistic level.
its
in
1, 1952 through son. Checks covering registration
$78,000,000. fees should be made payable to
Of the total, it is estimated that the Association and forwarded to
$26,000,000 will be expended in' the Chicago office of the Associa1952; $24,000.00 in 1953 and $28,- tion with the appropriate white
1954
the time.
more
service
program from Jan.
mission,
firm hand in
is
electric
A registration fee will be charged
for each delegate and alternate
territory, Carolina Power & Light his family attending the
the
ever
its claim of
up to
To meet increasing, :de-
for
are
for one, cannot
them.
corporate
Co. estimates that its construction
speculative
Federal Reserve Board had
a
con¬
If speculative excesses
noticeable now, I
other
Board, ranging from 101.31% to
Reserve
originally intended to
tool
a
mands
for
and
maintenance
efforts?
own
facilities
that
not
we
the securities market.
is
short-term
trading
medium, thus ringing up our reg¬
ister more
frequently and profit¬
ably. While denying better terms
little
economy
have
un¬
Margin regulations, the function
of
possibly
generally accepted busi¬
practice in other industries
But
not
blame, and
available
seems
direction.
many
been
Taxes, of course,
current
our
For
has
cry
the heaviest
like system of commissions.
a
the
now
fever.
is
become.
enough volume.
Which brings me to what I believe
to be an
inequitable, unbusiness¬
It
and
purely
it
ness
business,
to
what
we
fundamentally
are,
commission
limited
120
&
our
over-expanded
investment busi¬
its
for
been
arranged from
Chicago to Holly¬
wood and return. In addition, spe¬
cial cars are planned from Cleve¬
land, Detroit, Pittsburgh and St.
each
Qn
have
things
MAURICE,4 MOES,
Erdman
purposes.
large
equipped to handle
larger
If
for
from
New York
.
get to it before there
isn't
over-manned
benefit
tion
ses-
planned to schedule any business vations for the going trip should
the issue at competitive sale on sessions in the afternoons.
They be made through Russell H. Metzunspoken support for this line of
Monday on a bid of 100.693%.
will be left free lor enjoyment of ner, Central National Bank
of
reasoning.
If our survival as a
Net proceeds from the sale will the splendid facilities available for Cleveland; 123 *W. Prospect Ave,
business
necessitates
a
realistic
be used by the company to finance golf,
tennis, swimming, fishing Cleveland 1; O.
•
overhauling,
lets
roll
up
our
part of the construction of new and other recreation.
*
Detroit Special Car
Reservasleeves and
I
of
to
j
Transportation
trains
•
are
exploring.
a
tax
Convention
Special
Monday: thru
broad liquid meeting place, offered $20,000,000 Carolina Power
do all in our power to & Light Co. first mortgage bonds,
increase the volume, and I believe 31/2% series due 1982, at 101.305%
nue
rooms.
con-
a
morning
a
position of being
as
-
must
we
ourselves in the
so
with
stand still, we go back
present smaller
auction
our
program
Louis.
"
Joseph T. Johnson
Friday, Presij
Joseph T.
New York Special Train—PullJohnson will address the opening j^an reservations for the
going
ernment or its agencies and re- session on Monday, and the printpjp should be made through the
quire continual pressures for re- cipal speakers at the subsequent New York
Transportation Comlief. Instead of wringing our hands sessions will include:
mittee, of which John W. Dayton,.
and
feeling sorry for ourselves,
William McC. Martin, Jr., Chair- jr.; Clark, Dodge & Co., 61 Wall
some action must be taken.
Any man .of the Board of Governors of 'street, New York 5
N.
Y.
is
action will be constructive. If we the Federal Reserve System.
Chairman
1
' "'■ ■" ''v!
offices
our
baggage
by truck and distributed
promptly
to
the
proper
hotel
conven-
y^nYion
can
attempt to do ourselves,
other remedies lie with the gov-:
fields, and thus another
factor adds to
Some
will be
transported immediately from the
pattern of recentyears,
present form of the
business.
arrival in Holly¬
upon
such
will follow the
we
lot
tors, who, without attempting to
the ethical or moral angle
mission
securities
35% increase
a
the
100
argue
speculation, or its necessity for
liquid market, certainly were an
integral part in furnishing com¬
for
In the mind of the
unfair and large
to be
but
A
smaller speculator it looms
left
that
For 50 shares
it is $13.50. That is
tion
resign ourselves to the
there
is
no
economic
or
fact
all
at¬
station
The
in-
our
Then,
wood
be
hand bag¬
.
we
cost,
a
security priced at $20
a
for other
speculative profit could be
a
discussing the odd-lot
figure
business
over
the
the higher rate for doing
purchases lim¬
to
lost
we
transactions, which
on
also
must
but
on FT l a a y,
to
We either have to make
need
should
tags
the
merchandized
fight for the survival of
literally driven out the
smaller speculator. If our purpose
we
these
gage.
If they the use intelligent
if
of
One
hotel room numbers.
and
names
Sunday, Nov.
3y»
ending
initiative, they can stand on equal
terms in selling individual securi¬
ties and situations as opposed to
the
Mutual
Funds
sales
philosoohy.
Holly-
be per-
can
public.
lieve
we
service that
a
Hotel,
g i n n l n go n
are
and
a
will
The hotel's representatives will
tached to each piece of
formed
have to put ourselves in his shoes
we
they
certainly
i t nessing,
and that I be¬
w
Hollywood Beach
wood, Fla., be-
they do with member firms.
in the
numerical majority, have a func-
speculators,
customer,
in
now
small
penalizing
The 1952 Annual Convention of
.;
income,
plus
believe that the smaller firms,
and
also
we
additional
odd-lot
in
market
producers,
the
petrate
published
on
to volume
holding,
ness
change in margin regulations.
and
long-
but the Investment Bankers Associa- also furnish passengers with baghave also localized whatever busi- tion of America will be held at the gage tags filled out
with their
term
York Stock
Editor, "Commercial
Thursday, October 23, 1952
.
Investment Bankers Association of America
certainly, do
we
.
.
hotels.
over
as
Room
slips
keys
are
will
of
be
presented,
Heine
with
quis & Co. *
offices
at
'"
1
Wall
Volume 176
Number 5162
.
j The Commercial and Financial
Chronicle
.
(
(1531)
the
of Kail Marx
discip^s of Karl Marx,
?c
system is rarvifalicm!
Capitalism!
By BENJAMIN F. FAIRLESS*
Yes,
the tools of
less than $3,500
S.
tries.
That
ownership
is
sold
daily, in little pieces, on the stock
t
market. It is constantly changing
hands, and if the workers of this
country
tools
told
are
about
government
election.
the minds of
greedy men in every
of the earth.
They called
performed by mechanical energy,
w.me
less
is
than
the
of
this document
5%
ifesto"; and .it has become the
Unholy Bible of the Socialist's
religion.
7 •
• ; :
product
human
lort.
ef-
,
the
So
in
is
of
arms,
have to win
even
All
do
force
the
an
world
they
in the
to buy,
open
'
they
want
to
own—
millions of other Ameri-
as
Now I imagine that
be
may
.
some
saying: ."Oh,
of you
that's
all
bnelly,Marx argued that work±
le'J <>ood 'n theory; but of course
pre.sent-day are woma never be free until
they; it isn't, possible in practice. No
worker—with
worker—with .hemselves, owned the facilities of-S^up
modem
o u'r
°u£ workers could ever purmodern
deduction. He declared that they chase the great multi-billion dolmachines
is
jcuid only acquire this
ownership lar corporations that we have tonow
able to
trough revolution; and to foster day-"
produce about
hat revolution, he
preached the
Well, Ladies and Gentlemen, the
20
times
as
loctrine of class hatred.
He; saw other day I took out a pencil and
much
as
he
vorkers and owners as natural
-paperyand did a little simple
could
have
and eternal enemies. And
so, moreLarithmetic,
the results of which
turned
out
if
mm**/
—
-
.an
he
like
—
Benjamin F. Fairless
depend
physical strength
stanaard
of
for
the
-
tne
we
in
the
n
have
But
of
.
kt
developing
made
theory,
mistake
samp
i
they
ne
suf-
he
have
Yet these self-same tools of
pro-
nnnrso
They
sren t.
millions
as
uses.
of
are poles apart,
wretched
discovered
sorrow,
revolution,
the tools of Production. The
a
of
thp
iH-u/idP
wnr
threaiens
to
millions
is^ue
of
thousands
the
is
to
to
their
Then
And it is this issue—the
knees,
at this
owner¬
nf
of
t hn
Irow
the
inrr
England
was
fought
l^triPQ
in
industries in "Rritnin*
Britain;
key
but
meeting.
still the
coal
the days of William
Penn, the tools that a worker em¬
ployed were simple and cheap, and
and
he
and
them himself
as
rule,
a
but
today they have become so
complex and so expensive that in
many of our major industries it
remains that, at today
the
prices,
dis-
buy
outstanding
Corporation
just
every
common
just
cheaply
as
of
U.
of
easily
they can
the
and
as
as
S.
share of the
stock
pur-
jusi a
9*?ase a moderately good automo
cnase
It
unbelievable, but it is
seems
true... We
have
approxi-
just
not
It is all
steelworkers,
of
course,
the tools of
The
men
mines,
the
on
1
who worked
railroads did not
own
production.
Labor
them;
turn, owned
the government—after a fashionthe men themselves soon found
that they had merely traded one
purchasing
today's
wages
worker
just
earns
proximately
87
the average steel-
that much
10 months,
By investing $10
—which
is
about
a
m
ap-
less
would
than
10
turn
what
steel-
our
Steel
could
standing
the
is
buy
all
years;
ferred
in
dividends
stock—our
out¬
in
less
and—except for
relatively small fixed
paid
the
stock
common
seven
of
on
that
sum
the
workers
pre¬
would
workers
the
Board
present
man-
put Phil
Murray in my
job, if they wished, and run the
the
joyed
I
become
this
at
think
out
too
over-
that they still would
wllCil
when
customers,
those customers
against
locking
them-
workers!
mins
the
i
happy
delegation A1UM the
from
a
fl
walked
into
the
office
and
unless
can
"Phil,
the
boys
from
Ben
last
about
$500
a
And
want
same
time
year
Phil, of
let's
—
as
little
a
they got
as
that
kind
of
in
money —.eveni
America—it requires the combined
savings of millions of
in
all walks
productive
of
Thus,
whole
life, to supply the
upon
which
facilities
industrial
our
workers
the
over
national
come
aeeply
known
people,
our
depend.
centuries
economy
in
rooted
our
has
be-
what
is
the "capitalistic system"
the
—not
as
monopolistic variety of
capitalism
which
has
existed
so
IfPm the bureaucrats; and the
very
first thing that these bureaucrats
tried to do was to show a profit
on these State-owned operations,
To that end they raised prices substantially, a n d repeatedly; and
they resisted wage increases with
a determination and force that
government alone can command
would
course,
.To this day the pay of the Britlsk steelworker is only about one.
third
much
as
as
is paid
"Why sure, sure. Give the boys
whatever .they want. All they'vegot to do is pay it to themselves."
rfut
^es
for
: I'd like
that
kind
of
,
r++1
,
1 a httle
when
aoinsbvei-
^1^!? bovs
uSrnext
~
the
books
out
find
to
~
s<arry for Dave
as the new
where'
frol
rate k MmfaB
business
vince
jobs.
the
and
But
satisfied
are
to
as
there
no
new
keep
1
J
be
the
customers
as
happy, they could
-1
the
run
will
long
as
of the company could
owners
t
,
show
exactly
.Now Dave
those
gates
that
hard-headed
they
can
dele¬
them-
pay
to
call free
T3ii4-
14-'
La'<i
n
n
nwvov»4-
T
r»n
V*a
rtrkiv%„
ployees
out and buy control of
go
United
States
Steel.
I
that would be good
workers
or
the
don't think
either for the
Company;
from
the
interest, I
better
of
it
our
key
be,,owned—as
are—by
broad
a
cross-section
American
workers
in
representathe
of
consumers
products,
by
school
But
still
can't
c
I
help thinking
how interesting it might be if our
did
if
of
eaph
bought
uuu5"1
his
1110
own
the
them
87
?'
Company—
went
shares
out
of
ui
common
uummuu
stock, and if Phil Murray
in
in
mtr
my
office
phnnn
shoes
over
William
on
Boy,
nxTAr
oh
boy!
thnrA
there
Penn
What
and
were
in
4 U
in
rs
the
soft
job
he would have!
In
the
there
would
be
about,
worry
place,
no
of
course,
walkouts
because
after
dividends in the
place.
logical
they
men,
dividend
should
with
cost
the
their
of
blame them for
Then too,
And
are
as
—
along
just as
who
to
company—they
going to dis¬
owners
are
of
The
"Communist
About
maintain
to
and
expand
produc-
new
jobs
for
the
rising
genera-
tion.
Now
j\j0w
as
patriotic,
far-sighted
Americans, the boys will doubtless
onnrmro
approve
+ V»o4
that
nrnntinn.
r.i*r%/>A
practice; but since
that is being reinvested
each year really belongs to
them,
they will have a right to demand
return
They
on
will
expect that
this
also
the
new
have
investment.
a
right
to
market
value
of
page
42
Continued
on
OKLAHOMA METROPOLITAN OIL AND GAS
CORPORATION
Common Stock
A
Speculative Investment
in
a
^ * may resort, on this oc?as*on' to a very low and revoltterprise system was just beginning *n£ Pun' I should say that, clearly,
to provide our
people with all the Marx. did aot know a11 the Engels.
hundred
3rears
ago,
however—when our American en-
luxuries which have
so
commonplace
lives
—
two
in
very
highly educated
now
become
their
daily
brilliant
men
and
named Marx
tn
his
thirst
35th
Annual
State
Pa.,
address
by
22,
Fairless
at
the
Meeting of the Pennsylvania
Chamber of
Oct.
Mr.
Commerce, Piftsburgh,
1952.
for revolution, he
completely the only
overlooked
economic
which
control,
the
system
it
workers
cAn
inc.
1,132,000 Shares
a
earth
possible
themselves
to
and
facilities
shocking
on
is
as
manage
production.
the
news
the
own,
of
to
directly
may
Offering Circular
from the
may
25$
per
share
be obtained
undersigned.
under
for
to
Producing Company
i
offering price
And
be
to
SCOTT, KHOURY & CO., INC.
61
a
tion, to give the nation the steel
that it needs to make their own
jobs more secure, and to create
ISSUE
cialistic omelet.
Manifesto"
the
getting only
part of the profits, and that the
rest of these so-called profits are
being reinvested in the business
all,
0n the Marxist philosophy and is
trying hard to unscramble its So-
<
can
that!,
they
that
living,
do.
wages
cover
increase
announce
——
are
going to expect, I think, that their
a
first
dividends in the
the money
Place.
a
th
Being
whole
by
the
different fields
many
of
now
...
enterprise, by the
kinds
far
industries
of
public
na¬
is
they
and
first
and
the
think
that
should
tive
standpoint
,
3
th
of
enterprise.
-
ise*ves a $o00 wage increase out
of the $261 they §et in dividends.
But if he's as smart as I think he
they
>is> he probably won't mention the
Now perhaps I should make it subject at all, because way back
in my mind there lurks the hor¬
perfectly clear at this point that
rible suspicion that the
I am NOT
boys are
advocating that our emas
,
pleased.
a peculiarly, average .worker in our American
highly-com- steel nulls; and n°w a disillupetitive capitalism which we like S10nec! England has turned its back
brand
Ah.
deal
a
myself
b
g
om*
a very persuasive
is
fellow, and perhaps he could con¬
widely in Europe, but
American
and
afternoon.'
quiet
a
quality, quantity and the price
of the product, there will be no
the
the
to
,
re-
P^:
SCOTT, KHOURY & CO.,
NEW
say
starter."
a
takes tens upon tens of thousands
s^t of bosses for another. Instead
of dollars to provide the machines °t taking orders from the former
and materials that a
single worker owners of these enterprises, the
uses.
And since no individual has workers now
took their orders
of
president of the company,
hear the spokesman
saying:
new
not be their
every American business
its
are
striking
Then there would be that
day
own bosses, of course, for the true
bosses of
on
owners, or whether
were
as
prospect, however,
should be warned
they
out
go
Then he would grab his hat
Tiue Bosses Are the Customers
they
as
owners
uay
business to suit themselves.
Before
were
themselves
Then
years.
own
owner
raise—about the
investment of
an
week
a
workers
week apiece
workers gained in the recent wage
C
increase—the employees of 1 T
U. S.
than
owned
in
by
pres-
shares apiece. At today's prices, teachers, and businessmen, and
those 87 shares would cost them widows and pensioners—in short,
a total of less than $3,500. And at by the average American.
in the steel mills
government
while
in
our
com-
an
Why hundreds of lawyers
Washington would go crazy
trying to figure out whether the
cost
Directors, fire the
tional
quite
of
would
they could elect their
-
.
market
s
employees
Steel could
And during this time the
the
in
owned
in
too—a quiet
government—acting in the name
tne
of Labor—took over virtually all
ship of the facilities of production
Back
workers
control of the government for six
—that I should like to discuss with
you
the
little revolution which
our
death
economic
in
not
shares
give them a
in the Corpora-
market; and
trick
0f
87
$2,500, at the
them less than
c&n
in
S.
would
That
how
strike?
selves
U.
would
majority
$5
would
control
purchase
affairs.
only
divi-
a year,
to
Sixty-two shares
tion's
ent
total
workers
to
stock
voting
all
'
-
these
mon
of
.
with ballots instead of bullets, but
slavery, which placed Labor in absolute
their
to
men
they
A
—
little
a
about.
87" shares
order
have
apiece.
poration
battlefield, and dozens of years.
nations
own
which has brought
people
of
not
State
Commissars
had their revolution
most
of
do
steel,
the
only $261
in
even
0wn nothing at all.
whole
the
issue
they
But
workers — including
me. And together, they could buy
all the common stock of the Cor-
become
nave
but
owns
nf
that
our
clearly
nolitical
times--an
on
Thev
think
l
exnlosive
rnntrnvprcv
_
find them
even
much
so
rates,
their
on
amount to
the tools; the
°wn the workers; and the workers
have
^torm-cpntpr
destroy
civilization
what
Americb
you as
1
The workers in Russia had their unately 300,000 employees, That is
and
consumers
T~%
tjurbing. But nevertheless, the fact
people
their
to
wpa^ir^nf'AmprirnVfn th^wnrkl^
nnw'hPMim-p
may
:
this
amazing to
as
A
were to me. Perhaps some of you
campaign
day—even
fatal
one
.'__c
*
this
thought that public ownership and
government ownership were one
nnrl thn
thinu
AnH
nf
a/d the same thing. And, of course,
risen,
that,
to»
^jch has spread misery and
tdrmg^ all over the world:
invesied
sums
tools
in
Marx
told
t
momictive
persists
America, unhappily.
his
aiso
started- may be
he
ago,
"Hate-Ycur- Boss"
his
direct propor-
tion to trie increased
in
in
on
earnings
worker
years,
...
_
are
hourly
average
over
^
real
tne
to
And
alone.
century
..
he
which
living has flourished
accoruingiy,
that
the
^?n^aPS
still forced
a
current
dend
market, the capital stock of the agement,
corporation
heard
profits"
here, I'm afraid, they would
a
disappointing surprise,
At
cans have been doing for many
decades. So why should they do it
the hard way?
"Communist Man-
a
to
just
corner
little
a
by
They do not
Engels published in Europe,
document which has inflamed
a
the
own
,
average
and
95% of all the work which is done
in our
manufacturing industries is
to
,
Steel
a
that
wish
production, they can do
so very
simply.
They do not have to seize the
worker. Advocates wider
ownership *'
of big corporations.
we
truly
of
have
Today,
have real and
we
have
"bloated
be in for
direct Public Ownership of our
biggest and most important indus-
production/
holding they merely "change bosses." Reveals U.
Corporation workers could own the corporation at an
cost of
But
friends, the truth is that
here in America
Asserting there is more real and direct public
ownership of
important industries in U. S. than in Socialist
countries, lead¬
ing steel executive points out Americans can
buy capital stock
of any
corporation they want to own. Says great mistake of
Marx was his belief that
"government ownership" and "public
ownership" are same, and denies workers in Russia or in
own
my
so-called
they
Public Ownership
United States Steel Corporation
then be entitled to receive all of
those
We Have Real and Direct
President and Chairman of Board
nationalized industries of Britain
that
'-'sxrfetfrm
15
(ROADWAY, NEW YORK 6, N. Y.
TELEPHONE:
WHITEHALL 3-69SO
,■
'
J6
The Commercial and Financial Chronicle
(1532)
.
.
Thursday, October 23, 1352
.
two solving certain problems. .Each is atus—is to be concentrated upon
"time. This incapable of dealing with prob- disrupting the growing solidarity/:
threat can be "partially guarded lems all across the board.
The of the free world, to prevent the
against by a continental Europe great challenge to statesmanship unification of Europe and to break
so organized—with national miliStalin
in the period ahead is to make cer- up the Atlantic alliance.
our - economic
collapse.
tary
power
and
resources
so tain that the growing unities of predicts
merged—as to make nationalist the West develop in harmonious Moreover, he even dares to openly
aggression difficult. But the full relation among themselves and predict that he will not need to
guarantee lies in Atlantic Com- also with the free world as a attack us because we will attack
and destroy each other.
munity organization, with Euro- whole,
It was not very long ago that
pean defense forces merged into a
NATO army.
Hitler described in "Mein Kampf"
Harmony Feared by Kremlin
the means by which he expected
Likewise, continental Europe's
It is just such unity and harbasic economic and social prob- mony in the West that the Krem- to rise to power in Germany and
least, we.have learned from
world
Unificatioxi of Europe and
The Atlantic Community
DRAPER, JR.*
AMBASSADOR WILLIAM If.
By
United
Special Representative in Europe
States
Ambassador Draper warns despite great
strides made, United
need for sound businesslike eco¬
nomic foundations witiiin A'.lantic community. Maintains that
behind a Chinese Wall of customs barriers, instead of needed
States has not frankly faced
trade
Calls
Europ2 to produce
on
lems
friends with grants-in-aid.
have been shoring-up our
we
for
more,
forces
progress
and
its resistance v«
to
u
Communist subversion. It has be-
driving the
are
-
,
change
the
political
centuries and to
patterns
toward
move
forms ol
wioer
wider
Ti.
come
rateg
forejgn
people
asso-
gnd
torship in this
free
also of playing a more influential role in world affairs.
West only this
Unity
freedom
in
ery.
We
or
I think,:
toward greater eco-
toward
g^weco^
Precisely those points at
peoples are drawing
free
together, and presenting a united
front. The tremendous power of
Empire_its
^
propa.
in Europe in the past five years ganda, its diplomacy, its economy,
European unification is h
been made within the context its world-wide subversive apparno
longer a remote ideal but an
f large.Scale United States ecoattainable objective.
;nomic aid which has relieved exIt is an attainable objective pro;t
j balance of payments diffi- i
vided—and to my mind this pro-■;culties
Long-range
progress
is
Today,
•
slav-
Dr0gress
that
weap—
how he proposed to use that power
dominate
to
nent.
the
Many
Conti¬
Eurasian
people
who
should
have known better persisted,
right
to the end, in disbelieving and
up
ons for a renewed assault upon ignoring his blueprint for power
freedom, and pointing out just and conquest.
where, for fullest effect, the main
Today, Stalin's plan for action
for the period ahead is in print—
blows are to delivered,
And where are those most vital right before our eyes. We, the free
upon
the tariff
investment pracmaterials policies
hiehlv significant
problems without outside aid, but
unity
u
is sharpening their ideological
^
Century
peoples of the
m
raw
and others of the Soviet oligarchy
and others of the Soviet oli,
a
over
soiution
suiuuun
economic
gressive dicta-
choice.
men
their
United States, the United
decency only with widei
Kingdom and Canada—and upon
groupings of political and eco- ^ level 0f economic activity in
spots?
nomic power, capable not only of
unjted states..
> which
solving more of Europe s basic
Ag-
leaves
nroduction
jdui
But
died
area
dependent
increasingly evident to the
of Western Europe that
they can survive in freedom and
of
new
ciatign.
20th
.
,
lin most fears. For more than two
weeks we have witnessed the publie spectacle of Stalin, Malenkov
by
solved
partially
pxnand
and
Powerful
countries of the Western World to
be
can
our
purely European action to create
a single market and to rationalize
to buy more.
us
,in'.\
wars
checkmate that plan.
this time, use our knowl¬
edge wisely and well.
Let our
faith grow. Let our progress con¬
world,
can
Let us,
tinue.
Let
firmly
in
unite
us
ever
more
political,
in economic
military defense. •
and in
,
,
are
.
choosing unity
Nkws Airout Banks
.
Mn freedom
Within
;
in
in
torv
win
stanci
out
the perspective of his-
in
Six
2 X'
been
ve
nations
in
nations
.
the
heart
lantic Community.
part
as a
of Continental. Europe have taken
-
also
have
vou
Years you nave
of
important steps toward the merger
Atlantic
the
And
munity.
chart
to
Com-
initiative, action, and interaction
sovereignties in a single ;back and forth endlessly • across
Community. On a broader front the Atlantic. For European
their
of
have
we
just
witnessed
great
a
of activity b.y the 10 nations
surge
in
the Council of
Europe.
In
Paris, the Organization for European Economic Cooperation con-
tinues
its
vital
has grown
It
tive
The
European
Coal
Community—the
Steel
and
so-called
Schu-
man
developing Atlantic
And European and
institutions
in
rope's
1947,
in
need, that
*•
given
has
er
WL
clear, warning
•
that;
not
have
Economic Cooperation.
cLrse
Mutual
security
must come first.
p,Ilt
In
united
•
„_p
vltfaoPH^
«
and
franklv
Atlantir
tup
fnr
front all
ffrt thft
th*
v
sound
foundations
hncinf^lik-p pmnnmin
romrrmnitv
must
1949,
veritable Chinese Wall of customs
Other important European
projects are in the wind. A new
spirit
is
growing in Europe
and that led directly to the ereation of the Council of Europe. It
was
the Council of Europe that
barriers and procedures. With too
today—a
European spirit-and with it the
iiope that adequate security, economic
well-being
dignity,
scale,
so
and
uncertain on
can
be
found
life
a
of
national
a
in
wider
a
The
are
pressures
favor
incentives
and
Eurooean
unification
unification
plain"
n
,
Europe
,
y>
are
.
.
,
c™ntnes
of
danger, if separate,
in
vLfa"^i™?, by one under So"
viet domination.
,
.
.
only
force
rope
toward
forget,
driving
not the
is
Western
unification.
for
Europe
originating
caused
two
.
in'
world
.
Eu-
Let
us
certainly
.does not, that nationalist
s 1 o n
aggres-,
Germany
that
wars
brought the civilized world to the
brink
Pact
of
destruction.
-
of
During the
-
be built
of
—
.
The
Street
newly enlarged William
Branch of The National
and
havp
wp
rals of
branch
maintained
In-
standing
kont
a
Old New York.
The
originally opened at
jn
r0De
the
the Atlantic
mtre
i
has
Manager in 1932. Located at No.
130 William Street (once known
as ''Shoemakers Lane")
in the
^ear^ °* the insurance district,
the new Quarters are double the
size of the Previous premises and
wads are decorated with color
Europe,
never
including
Germany,
aggression
happen. again;.
This
must
deter-
mination sustains the statesmen of
Continental
Western
Europe as
encour-
as
by chance
that
aid>
Neither do
members
of
have
more,
I
think
other
the
Atlantic
the
faced
and
up
we
five
Eu-
to
must
buy
growth
Community
together the longer
social prob-
range economic and
lems of the Atlantic
—as a
Tr
*u
xt
.
Community
..
closer
and
..
a+i
tu
^
^ ?^1CL
oL
^
10n^ a^ >:
It is not
created
organs ;
of
com-
power
?
Ve
*
de*fn®es>
♦
„
r
.
fubmit to shareholders a proposal
t0
^ Presently outstandmg 50,000 sharesof $2° par value
a"ar
value of
,
Political
shares
additional,
they fashion
an integrated EuroArmy to prevent aggression
by one country against the other,
while
building the defensive
strength of all against outside ag-
pean
gression from the East.
Economic
and
political necessi-
ties likewise drive
Europe toward
unity.
,
Insufficient production and
narrow
to
markets; national barriers
.Soviet,
'
imperialism
Western Europe, but it
.
ns?S'Superintendent
defenses
it
understandl"Ss> to hammerreach .
out
tn
owciisc..
**
the
new
approval
of
and
less the United States. And it
is clear beyond question that Europe alone, no matter how organized, cannot within the foreseeable
future
successfully defend, itself
against Soviet attack. Nor can the
United States afford to be without
allies. Both Europe and we our-
Broadway,
The
16.
'
,
Ltd.
New York, on
agent of
New York
*
Martin
Cashier
the
of
of
Bank,
*
*
Alduino,
Assistant
Lincoln
Brooklyn,
Savings
N.
Y.
com¬
bank
of Banks and
to
of service with the
years
October
on
10. The occasion
recognized
was
him
to
on Jan.21, next. Distributipn ^ the $tock dividend will be
meeting
9,, to
holders
of
,
.
the
at
in
luncheon
the
Officers*
Watch,
appropriately
inscribed.
Fred
Honold, the President of
Lincoln's 25-Year Club and Alfred
Hoercher,
the
member
new
quarter-century
has 48
now
are
Secretary-Treasurer,
the
welcomed
club,
into
which
members, 14 of whom
retired.
Mr. Alduino
was
appointed As¬
sistant Manager of Lincoln's Wil¬
liamsburg office at 12 Graham
Avenue, on Sept. 27, 1943 and was
subsequently elected Assistant
Cashier
on
Jan.
*
The
8, 1947.
e
Peoples
$
National
Brooklyn, N. Y. at
favorabie action on the proposal ing declared the
.
a
Bank
of
recent meet¬
usual
quarterly
dividend of 40 cents payable Nov.
1;
also
extra dividend of 40
share on the capital
stock payable on the same
date,
bringing payments for the year
to $2.00 per share.
"
v
cents
an
per
.
*
•
The
First
Lindenhurst,
its capital,
$125,000
to
«
-*.•
-v
\
National VBank
N.
Y. has
$200,000.
1
of
increased
effective Oct.
crease,
$12,500
stock dividend,
'
Of
resulted
8, from
the
in¬
from'
a
while the sale of
Institutional unity in the North JBillhardt to the Board of Trustees
Atlantic area is growing today, as of the Roosevelt Savings Bank of new stock served to enlarge the
we have seen, in several concen- the City of New York. Mr. Bill- capital to the extent of $62,500. »
#
*
trie circles: There is the develop- hardt is a commission merchant
Bradley Baldwin Gilman has
ing Federal structure of the; six with offices at 82 Beaver Street,
Continental nations; there is the New York.
He represents Far been elected Vice-President and
wider association of Western Eu- Eastern shippers of natural rub- Trust Officer in charge of the
Trust
Department
of
the
rope as a whole, of which j the ber and other products of that
Worcester
County
Trust
Com¬
Community of Six is an inescap- area. * He is a member of the
able part; and there is the still Rubber Trade Association of New pany, of Worcester, Mass., Edward
move- selves need a greater coalition of
labor; low productivity— strength—the Atlantic coalition.
its economic
The revival of German or other wider Atlantic
these have hindered
-T
Community.
A.11
Vork
In„
.
American
L.
Snice Trade
—-
Clifford, President, announced
Oct.
14.
Mr.
Gilman, who was
aggression in Western Europe it- are interdependent; each requires
° \
® 5"J
before
athlreS2isty A^,ai5aior Dvpe,r
is a danger that the countries for its most effective operation the
s
to' Commodity Lx- formerly a partner in the law
firm of June, Fletcher, Gilman &
"Herald
Tribune"
Forum,
New
York
there must guard against as must successful operation of the other, change, Inc.; American Idonesian
on
■
^
,
*
Bank,
the bank is Toshio Nakamura.
the
»u,v-; record Jan. 9, on. the basis of two
:
no
commerce, transport, and
ment of
of
?
w
course continue record dale.^,
>
' to arise—must and can be resolved
,;.4. *
*
«
threatens ^ a spirit of mutual good will,and ..
President Adam-Schneider, Jr.
threatens^. or full equality.
f ]
announces the election of Philip
hopes.^ fears
//
111
Oct.
capital stock in the form of a 10%
aJIl stoG^ dividend. The actions are
ereign nations with a common newly authorized $10 par value
RV!;]Pose a
.a con}mon obJ^cnve* shares for each ten shares of the
impelled Differences in points of yiew-^ $20 par value stock held on the
ward Atlantic unity—are
same>
sTu"ne°r share
with a par value ot ^lUper snare,
and to issue to shareholders 10,000
necessary to^ reach clear by shareholders at : their annual
Community. T/'T 1 - v.
These parallels developments—
toward
European unity, and to-
the
at
-
Community—and move to-
association.
hac
vparu
by the
must consider
the ward sound solutions
in Western
mitment of United States British
and Canadian ^sources ana power
resources and
by
*
Chiyoda
much
called
European
unity step by step with, the
pressures:—*
*
-
....
The
a
up
we
made, on; Feb.
that -nationalist
Savings Bank in New York City.
Dining Room of the bank, when
he was
presented with a Gold
have been
shoring
the community with grants of
_
of
been
Trustee of the Broadway
a
(for¬
Duncan
Dunbar,
Manager,
has merly The Mitsubishi Bank, Ltd.)"
of Tokyo,
Japan,
announces
the
served at the branch since its
opening and was appointed its opening of its New York Agency
^vthe
Europe
exec¬
*u£ton and the Trench Koom a
Barnard College. An Historical
Booklet has b en lssued mcid n
tp
® opening of the enlarged
security and well-
nast
elected
Drisler, Jr., an
Mills, has
Cannon
of
their
the same problem. In my
opinion,
Europe
must
produce
was
agement of the United States,
been paralleled
Inc.
tendered
ship, but with the strong
unity
William A.
utive
address in October 1931.
.
not
United-States,
was
same
th.en ^r™e much more from Europe Unless branch.
t
,
™mlster °f France. The treaty for we import more, the existing dola European Defense Community lar gap threatens our own export
Directors of Clinton Trust Comwas brought to signature primar- trade and may unfavorably affect pan)'.
New Yoi .1 a ;e?u ?r
jiy by great European statesman- our mutual defense effort. We meeting
on Oct
15, voted to
of
the
that
contribution
^ ls
in
merce
are the French Embassy in Wash-
Force
little trade
it was a decision of the North At- m,unity
iantic Council regarding a German side 0f
growth
the Netherlands Chamber of Com¬
Com-
Defense
essential to the
Bankers
and
•
CAPITALIZATIONS
pleted 25
first proposed and debated; but
defense
i
,V
J1111!3!? by artist Jeanne de Lanux,
depicting lower Manhattan scenes
in tae *800s\ ^m°ng
w°u
being of the Atlantic Community,
German Threat
R.if
But tho Soviet threat
the Crvvrjot
not
progenitor
forth the proposal for
context.
that
the
Atlantic
European
a
the Brussels Pact of
was
North
REVISED "
the
the
was
that
>
enough—that
done
Plan—merging the basic resources of six countries, has come
into being.
1948
<
OFFICERS. ETC..
0
the Supreme Command-
Ridgwav
Eu-
called
into being the Committee for Eu-
turn, it
NEW
vpar<?
Chinese Wall of Customs Barriers
to
response
manifest
ropean
NEW- BRANCHES
military defenses. But General;
our
General Marshall's initia-
was
'
CONSOLIDATIONS
.
We tWf* made in strengthening. ;
have
great strides the
*
5
n.it connrar
nnct
inter-
are
twined and interdependent.
creating a single market in
Europe that xs both wide and deep.
toward
a
Atlantic
.
City Bank of New York opened
we must build greater and greater
Oct. 20 in new quarters which
unity strength in the face of today's .have been modernized, air-cononly within the frame- danger He is right We must hold ditioned and decorated with mu-
Community.
directed
work
of
Work
-
and of
the worM
the
have to trace
you
0f earning its way in
_
" y°" c?-?rt,-the m the last ®u"
F"ȣth1 ot. few
institutions
years
the future only if Europe,
findsJ meang
assuring a decent
At- standard of living to its people, ,
•
without large-scale outside aid.
'
-
■
Jn
:Hkel
ropean
tne neart gr0wth
in
the
Europe
in
.of the growing unity of the
wilV"tand "Yt
whibh
wmcn
Europe
isurope
sharply
ha
Draper, Jr.
Provided
—
continues to take place
months events
William H.
crucial
is
movement toward unity
e w
f
t
p a s
viso
;
the
City
Oct. 20,
1952.
we
in
the United
States.
This, at Each, at its level,
is
capable
of Chamber of Commerce, Inc.; and
.
-
Continued
on
page
43
Volume 176
Number 5162
i
The Commercial and Financial Chronicle
.
.
(1533)
making
Needed—A New and
the
exchange
more,
and
course
.
of
goods
balance of international payments
and agriculture in
qnderdeveloped
solvency in their5 domestic areas is of
the Korean
difficult.
more
Of
and
War, the addi- < economy; These governments rec¬
burdens: imposed by re-; ognize, the need for anti-infla¬
armament
and
disturbed condi¬
course
By GEORGE A. SLOAN *
have
Chairman, United States Council of the
far
of
Prominent industrial and financial
and compromise in
needlessly keeps piling up expense for rearmament, eco¬
nomic and government
loans; and absence of proper long-term
policies is impairing our export trade and mutual defense.
abroad because of reliance
on
enormous tax
charity.
Calls for increased
real
all
can
that
agree
in
peace
Europe, in Asia, in Latin America
or
even
here
at
home
will
a
on
the
Kremlin's
States
for rearmament, for economic aid and government loans,—
policy
that
the
runs
abroad.
risk
Since the end of World War
II,
ing off recurring crises. We have
moved from one form of emer-
the
i t y
rapidwith
which
free
foreign aid
gency
other and from
to
program
one
in.the
we
measure
The free world
the United States has been ward-
will
desperately is
United
to
up
peoples
craves
a
themselves.
will
depend
upon
It
leadership
in
the United States which will
bring
unity and understanding that rises
above class conflict and
special in-
terests.
One
can
only speculate as to
military, political and social
consequences the free nations will
what
exnerienre if
an
permitted
occur
to
tendencv
can
not only
uoon
ernnnmir
rri<;i<5 ic
Whether
be arrested
this
denends
the actions
of
&t
our
friends abroad,
upon our suecess in the United States in
sup-
plantins emergency procedure and
agencies
-
with
positive
interna-
tional economic policies.
-Frankly
y
I do not believe our
country is
47
sufficiently aroused
to the
sis and treatment.
We have
-
ber
to
seems
a
the
;'?.,•/;
international
economic
problems
that
leadership for which peace-lov¬
ing people everywhere are yearn¬
ing—for that leadership which is
me
over
United
andan
number/; of
or
of
score
agencies
Presently,
-
scattered
are
a
Under
even
international
Cabinet
a
mem¬
administrator reporting
an
Of
economies
develop-
abroad
to
own
An
lead
>
a
•
challenge
'■
to
that
government
accept
it
gap.
from
will
reduce
our
the
for
the;
debtor
we have
faced other problems vital to the
preservation of
our
liberties* It is
worthy of the best that we cp
give—in thought and sacrifice.
/
-
James K. Miller With
Schoellkopf, Hutton
eco¬
sistent
for
the
United
States
to
preach trade liberalization to for¬
eign
countries year in and year
out and then not to make it easier
to
so
sell in
long
the American
such
as
endanger
American-"
have told
not
in
and
agricul¬
; ' >" T';.-•'/• /
T '"
crusading fervor
a
the free
that
years
do
standards
industry
•
With
market—
imports
living
ture.
world
these
nations
lower their barriers
we
for five
to free
must
and
liberalize
James
:
commerce
K.
Miller
trade
com
We export annually $5 billion1
the creditor—for the United
more VJ g£°ds than we import. As states in particular—I do not be? resuJt>tke rest
free world Heve the answer is to be found
determination with which
con¬
stability. It is hardly
from using up at home what he
should sell abroad and to discour-
goods for domestic consumption
intelligence
and courage in and out of
govern¬
ment. It; will call for the same
in
the interests of international
age the production of nonessential
when he needs-to earn dollars
from trio sale of ovrjArrohln rfooHo
the
of exportable goods.
for the mobilization of
con¬
nomic
prevent
objective, I am sure,,
building of world trade in a
dynamic economy. This will call
interests for
need
tinuing foreign aid. It is also
and
Inflation controls must be
frnm
it should
policy with
The major
is the,
foreign-produced
more
goods. This is in
eco-
.
to
to
take this task for the
good of our
and as a bulwark to the
free world.
nation
payments of friendly nations on a
healthy and enduring basis it is
imperative that the United States
from the creditor,
applied
greater importance,
unified purpose and coordination.
In order to place the balance of
important, but not the only,
IookinS American policy. In the
n?ea"time- the prolonged dollar
shortage is creating a cleavage between . European - and American
fco"omit;s' impairing our export
trade and endangering mutual detense
•
of
presents
their
buyers.
.
funds
that
be
eco¬
waste. It would permit
pruning of
staffs and administrative budgets.
and
-
forward-
"
Coherent
a
foreign
Commerce.
than
agencies.
For the debtor—for Europe in
particular—the basic need is to
sell more.
To
accomplish this,
ycnegremeeseht
efforts with a austere credit and tax policies are.
me
continuing long-range study. We required so that prices can be
kave accomplished little toward held to a level that will attract
of
the
is
never
■
point where they can improve living standards and provide for
of
PriminS- But as a nation we have
be®? remiss by not accompany-
establishment
of
larger
revival of inter-
a
commerce
a
large price and willingly so. symptom of the world-wide
But, I submit, our policies have nomic problem is the dollar
not secured enduring results.
A solution can be broached
Don't misunderstand me. Tern- two sides, from the debtor
the
can
economic
new
*,
a
ment
paid
Porary
relief was needed; the
Marshall Plan was essential pump-
for
of economic
truth
foreign economic undertakings: capable
of
guiding ; people
of
one centralized agency of
diverse interests and ideas into
government—possibly the Depart¬ agreement and which will under¬
States
positive
.
in
private investor.
can
more
their
fidence
encour¬
first order of business should
be the consolidation of all Ameri¬
these activities
.
George A. Sloan
policy. It
our
can
harness
every
overall United States
ment
our
defense.
This, I am
other.
True, our basic motives sure, is the most hopeful course to
have not been challenged nor have lessen the
weight of the tremeneconomic we practiced a policy of penny- dous
appropriations we are now
strength and pinching.- But lofty motives and making for the common defense,
rebuild financial grants have not proved
>
;
:
1
faith and con- substitutes for fundamental
analyThe Dollar Gap
1
substitute
directly to the President, this plan
would discourage duplication and
national
an-
agency to an-
govern¬
our
•
.
own
fied with the need for
nomic
at home and and coherent United States foreign
:economic policy. What is needed
in-
on
if
can
share of the responsibility and
opportunity for leadership,
of
tent ions. It
depend
Our
do the
necessary job
•-/•A Challenge to Leadership
V- *,.'•• "
This situation is closely identi; ; The solution of these
complex
;
lies
in
foreign relations.'.
extremely serious, this
trollable
expense
a
and
policy
situation need not become uncon-1 undei;
the
has been following
policy that keeps piling up the
[J. not depend creating frustration
solely
that
convertibility.
currency
attainable
It lies in the
determination.' / It
While
government's
government funds
"just for now"
,
our
vertibility of currency is definitely
statesmanship in facing the
problem with understanding and
burden, and
now,
leaves the unfortunate
impression
abroad that government funds
will
development. 'The
demanding.
are
con^-
goal of
This is not wishful thinking. Con¬
expansion and freedom which
the best interests of all their
peo,
their
achieving
lies
cause
It lies in the failure
governments to carry through
pie
basic
a
as
in
success
aggravate / the
deeper.
lack of
.In any discussion of the current " The blunt truth- is
international economic
situation United States
measures
to
to
root
But the
of
respect for contractual agreements.
we
/
to
dition
policies of strict domestic
ment/should give
financing and internationally to
agement
to; this
carry through an economic policy,
spirit; "'•/ /•' - - ••< ;-t
this
Cites dissatisfaction here because of
helped
markets
drastic
leader, attacking tentativeforeign economic policy, asserts
our
material
raw.
problem.
International Chamber of Commerce
ness
tionary
in
important; It
cannot, however, stand alone.
Up
tional
tions
17
by
re¬
James K. Miller has become
as¬
sociated with
Schoellkopf, Hutton
treme urgency of this need. In
& Pomeroy,
Inc., in their New
my
have
declared
in
our
national
York City office, 63 Wall Street;
opinion it is not only important to
policies that their only salvation
©ur economy but also to the mil-,ls
Mr. Miller will continue to cover
tOvpay for those Ameri- jn the extension of additional is the acceptance of
competition
the Middle West and South, in ad*
itary potentials and the solvency caiJ goods which they vitally need. ioans.
The pyramiding of loans and the ending of national restric¬
©f Western nations. In the end our
American exports are necessary mereiy delays the day of reckon- tions. Meanwhile, we have flinched dition to working in New Yor&
success in dealing with it
City. He was formerly with The
may be
maintain the free world s eco- jng
from facing our share of the re¬
Dominion Securities Corporation
the test of whether we are
worthy
Should there be additional out- sponsibility. We have allowed in¬ for a number of years and prior
of our greatness.
fense against Communism. They - h
t?
difference or vague fears that'im¬
6
are necessary to make the Westthereto was with Dillon, Read &
5
B
Compressed between'the everreBrmsment
progrsm
efContinued economic did of this ports may have some possible ad¬ Co. and the Illinois Merchants
increasing rise in economic na- fective.
verse effect on our own domestic
Drastic
Trust Company of Chicago.
reductions
in nature can be compared with givtionalism and the grandiose ideas
American exports whether mili- ing charity to the unemployed in- economy to prevent the adoption
inherent in government planning,
of effective measures.
tary or n0n-military, might not stead of providing at some point
the free world has had little
opIf we decide to cut down on the
only- undermine NATO but pre- an opportunity to earn their own
portunity to bring order out of
amount of dollars we can give
the economic collapse of way.
economic chaos.
away but are not willing to in¬
the West for which the Kremlin
No—the real answer is not to be
In this state of affairs there is has
crease our imports, this must nec¬
been
waiting and planning found in additional loans or handalways the dangerous tendency for since 1945.
essarily mean a cut in the volume
outs. I
am
confident it can
be
Scott, Khoury & Co., Inc., mem¬
people to lose their
of goods we sell to foreign coun¬
bers of the National Association
self-reliance,
There is growing dissatisfaction found in down-to-earth economic
to fad to distinguish between the
tries.
Immediately,
more
than of 'Securities
jn
United States because per- sense.
Dealers, Inc., New
three million American workers York
City, are offering "as a
en"'al cmergency £oreign aid Pro" ' The economic policies of the free employed in export industries will speculation" an issue of
1,132,000
end To
surrender
freedom
for grams
contribute to an already nations must change from restric- be affected. This in turn would
shares
of
common
stock
(par
BlausiWe
of
plausible
anormous tax burden. There is tion to growth and expansion. Im- injure the American farmer. Last 1
promises
of
security, dissatisfaction
cent) of Oklahoma Metropolitan
abroad
because
That such surrenders threaten to
oort
quotas
trading blocs,
exm3nv
cpif
year foreign markets provided an Oil & Gas Corp. at 25 cents per
npnnipg
Hn
quuulis>
be irrevocable and to culminate
»e
lrrevocaoie
ana
10
culminate
P.6??1?8 d0 change' controls and unsound outlet for over four billion dol¬ share.
not uke to
re|y definitely on m0netarv urograms imnosed bv
m
the very totalitarianism
the
lars' worth of our farm products
tv,p
nf
monetar^
Oklahoma Metropolitan was or¬
f^tright charity. The dilemma of governments are interfering with —which represents the combined
much to avoid could be the his0
u"lte^ States hes in the fact effective economic policies. These farm income of the states of New ganized Aug. 20, 1952, in Delaware
tha* despite our gooa intentions
and has recently purchased the
toric irony of our time.
governments would do well to York, North
and our contributions we are still
Carolina, Indiana and interests of Clint Watters and
as
ex-
mitting
tariffs
and
quotas.
We
-
rinmmuniT^TTv
_
_
.
,
xi
Okla. Met. Oil & Gas
cip£ale
.
Common Stk.
^
Offered/
fundamental6traths ancTin'the
m-omiies
seTritv
u
Economic
faced
Problems
an
Equal
with
economic
Threat
serious
international
problems.
realize that their interference be-
yond
the
level
of
police
—
Our
rb<:tinf*iiichpH
^t111^111811^
bassador Draper has
niipntiv
quently
problems
that
that
are
fHpnrl
■
1
stated
1 cannot conceive that
Am
we
must
' Bve with this situation from crisis
elo-
TTnrnnp'c
Europe s prmnomiV
economic
as much a threat to
that continent's
stability as the aggressive
designs of the Soviet
Union. Certainly an economically
strong Europe will be a vital
*n
rrjeic
At
tv»P
camp
timp
t
am
c^18^- At the same time 1 am
unwilling to admit that we are inranahl#» nf
Station
solutlon'
finriina
g
a
mnrp
policy
the
United
■
York
York
,*HcraLMTrlu"--beF,rr<u^e
City, Oct. 20, 1952.
preventing
i
of
•
i
increased stand-
mu
tt
•*
j
r.f
„
living. The United States
Government
should
urge
these
.U1
,
g fondly nations to clear the tracks
°* property, nationalization of inStates
which looks beyond
the dustry,
application
of
import
problems of the-present and re- quotas and imposition of exchange
jects the concept of "just for now." controls have
become
accepted
economic steps.
in
a
ards
lactim*
Ugly Restrictionism
Basically, the free world is in
factor in maintaining an adequate its present predicament because
defense against any possible ag- of the cumulative effect of restricgressors. But to keep effective al- tionism which is raising its
ugly
lies, we must formulate a foreign head everywhere. Expropriation
economic
thus
We live in a period of complicated and hidden
import controls,
of
such
obstacles
and
offer
our
assistance in this vital task. At the
same time, we should recognize
9ur reciProcal obligation by clearing away a lot of debris at home,
Fortunately,
some
governments
in Western Europe are now in the
of clearing the tracks. I
referring to those who favor
process
am
freer
rency
multilateral
trade
and
convertibility and who
wnrkin?
natientlv
to
that
Kansas.
T
action
tends to obstruct the flow of goods
and
services
across
boundaries,
cur-
are
end
They are pursuing domestic pollcies whose prime objective is the
Respect for Agreements
Pearl ,G. Watters in five certain
leases located in the Munger Pool,
Oklahoma County, Okla.
It was
foreign formed for the purpose of engag¬
policy must stress that the founda¬ ing in the business of producing
tion of international understand¬ oil and gas.
The oil and gas runs
ing and good will lies in universal as from Sept. 18, 1952 will be
respect
for
contractual
agree¬ credited to the account of the cor¬
Just
ments.
forcefully
as
our
Arbitrary confiscation and
poration.
nationalization of foreign holdings
The net proceeds from the sale
flow of private of the shares will be used for the
funds for economic development
payment of properties and for
purposes.
The capital-importing working capital.
country must accept its responsi¬
bility for creating
a
favorable
W. A. Buchholz Opens
climate
for
industrial
develop¬
only
ment.
hinder
the
May I cite the remarkably
climate
favorable
progress
of
our
and
resultant
good neighbor to
the north.
CITY, Okla.
—
at 1010 Northeast 14th Street. He
The Point Four program
lmnrnxromonf
OKLAHOMA
William A. Buchholz is engaging in
a securities business from offices
a!
oHilPafinn.
for the
hPfllth
was previously
& Co.. IllC.
with King Merritt
,
The Commercial and Financial Chronicle
18
(1534)
.
■
■
•
.
h
■
•
-
public service, make the State the master instead
It
municipal em¬ of the servant of the people.
ployees, where the machinery ef¬ requires a certain amount of cour¬
fecting higher pay is complicated age and logic to stick with this
by statutory or legislative pro¬ point of view year in and year out.
ceedings and traditionally suffers While this ideological battle has
have been those in
such
More Stock Owners and Less
Business
by Government!
a
By CHARLES E. WILSON *
Formerly President, General Electric Company
changed attitudes toward private busi¬
ness, Mr. Wilson points out securities business, though formerly
held respectable, is now "a suspect." Accuses Administration
of splitting the economy into segments so as to create conflicts
and misunderstandings among groups in industry. Holds there
has grown up an ugly and powerful dictatorship of labor lead¬
ers, and, as result, collective bargaining has gone down the
drain. Says we are going down road to Socialism, and have
shifted from a competitive to a subsidized economy. Urges
wider ownership of corporation stocks, and disposal of gov¬
In calling attention to
thing;
Campaigning is one
po¬
The
litical action is another.
men
that
certainly includes almost all of us,
American
of
•
business,
1
and
confused
nave
the
for
two
far
too
long.
Political
ac¬
which
part, I can only point out
that this is my home town. I was
born
here, went to school and
went
tell
work
to
dreams,
indus¬
the
of
our
in
year
results
and
ourselves
large
been
is
in
we
passive
such
business
vate
I do not mean
fact
I
and
and
in¬
of
There
when to
buying and
equities in pri¬
suppose,
the
engaged in
selling of shares
in
what
time,
a
be
po¬
But
it.
this
doing.
the
state
to
was
hold
we
as
from
aloof
measure
have
long
so
you
change,
standards
respectability.
tegrity and
We
of
consequences
action
litical
the
them
or
was
conservative
a
respectable undertaking.
day,
as
aware,
you
only
are
constitute
you
special interests which
terms, because I believe tha^ every
man
in business,
whether that
future
business
banking
farming
or
whether
and
of
manager
newest
he
of the
one
the
menace
employee,
clear obligation
general
I do not personally subscribe to
the
or
has
today
to extend his la¬
protect his true interests,
and project his reasonable convic¬
tions in the field of direct political
If he does not do so, he is
foolish, incompetent, and lazy.
that
working for the election of
didate, then by all
it
But
means
economics
basic
our
or
a can¬
do that.
other things
means
many
well: learning and
as
If
contributing funds
means
teaching the
of
arithmetic
or
legislative and administrative
tivity;
civic
ac¬
associating yourself with
and
community undertak¬
ings; taking intelligent advantage
of opportunities to appear before
hearings and committees;
solicit¬
ing the understanding and support
of
educational
and
professional
bodies; involving
and
tatives
spondence
living
a
in
corre¬
that they will know
so
what you think;
ing
Represen¬
your
Senators
in "short, becom¬
in the daily
figure
political scene, so that
with
reckoned
you
have to
the
on
of
day
wrath.
has
never-failing
political
most
am
office.
what
on some
mannerisms
the
prophets
climate
seem
true
Right
be
to
the
now
giving
out
on
in¬
more
fluenced in their prognostications
by
the
picnic
there
a
tomorrow's
weather ' for
than
the
by
and methods of
can
be
lend
changes of
tools
proven
meteorology.
But
doubt that this is
no
changing climate, and
will
itself
our own
that
one
further
to
making, if
we
even
proceed wisely and truthfully. For
not
have noticed that
what State,
matter
city,
large
what
or
was
his
born
school
near
there,
something
him
remarks
kinship with
or
he usually
by
the
claiming
spot.
He
there, he went to
he
slept
homely
his
,
family
there,
or
happened
to
in
*An address
that
spot
does
of
we
have any true
it
country,
is
a
not
losses
the
and perquisites
earners—the liberal pen¬
prerogativess
sion systems
that have been insti¬
pressure, health in¬
not only for the worker
under
tuted
surance
but for his whole
for
to
but
raw
About
to
vate
the
public,
nues,
debt.
increasing
and
This
reducing
amount
somewhat
to
my
of
a
comment,
surprise,
suggestion
same
a
reve¬
public
suggestion attracted
reasonable
very
tax
the
as
had
the
been
couple of times before,
I
and
ago,
years
without
a
any
paying much attention to it.
should like to touch upon this
idea again before we are finished.
I
mention it here only as
another
kind of
leisure
time
on
some
cal
and
to
of
we
tighten
have been
I
past decade, that
issues
between
them. Out of the re¬
complex of troubles has
among
am
lion's share of
our
economic difficulties.
quite cognizant of the fact
any
one
who speaks
in this
perhaps longer, has been the dou¬ vein is immediately dubbed a con¬
bling of wages and salaries for a servative, a reactionary, and an
This enemy of the people, and is thrown
has not alone been true for people on the defensive. But he is really
vast
in
of
number
business
incomes
agriculture
industry, because a liberal in the true sense. Not the
engaged in self-styled liberals who have flit¬
have also increased
those
ted about the American
proportionately.
groups
which
increased
asked
of
came
the
supply
com¬
fabricate steel.
not
half
loss
or
from the
this
,
And
State
taxes.
billion
dollar
count
after the Congress
President
to \ use
the
used.
this
About
have
not
been
in modern
never
reluctant
to
for
pay
productivity and value,
but the minute it
signs up to make
such payment without any guar¬
antee
and
on
the
ahead.
a
the
that
effort
human
skill,
care
earning it will be laid
line,
then
lies
trouble
We have then shifted from
competitive
sidized
to
economy
economy—and
a
sub¬
know
you
You
a
was
a
Presidential election. But by no
of the imagination can it
stretch
be called
a
victory for the working
members
of
the
union,
the
working
for
steelworkers,
scene
only
partici¬ ing the past decade—who
dur¬
the
pated in this widespread increase fact
coHectivists.
Who
are
aim
swers
to
seems
as
these
though
we
are
But
it
powerless
this process which can only
bring disaster to all of us.
members
Broader
union, or for the taxpayers
ordinary citizens of the United
States. So much for a specific in¬
Ownership
and
stance of labor
questions.
to stop
of any
dictatorship.
of
Equities
Needed
Perhaps I have
a
Americans.
and
of
tax
that
does
or
Industry has
times
the
from
en¬
the bands around
economic
and
present
the
this
transport it
ter.
tax
can
logically say that ing. And what will the
purchasing
victory for Mr. Murray.; power of the dollar be in another
each segment and create conflicts Perhaps it was also a victory for ten
years, on this basis?
We are
and misunderstandings and politi¬ the Administration in the year of not children.
We know the an¬
and
born the
One of the outstanding facts
of
But
into smaller and smaller segments,
attention.
economic life
account
Taft-Hartley Act.
And,- as Mr. who will pay the subsidy. How
couraged to believe that it is not Lawrence pointed out, Philip Mur¬ high must wages go to satisfy la¬
a
minority at all. The dominant ray made a speech on June 22 bor's dictators? Would you say it
that
the
President
had should be 10% a
Washington philosophy for two saying
year, indefinitely,
decades has been to split up this committed himself to Mr. Murray
with perquisites increasing in the
great all-embracing concept of in December, 1951, pledging that, same ratio? That is the patn with¬
business and industry, to split it up the Taft-Hartley Act would not be, out end which we are now follow¬
protected.
political action in the eco¬
sulting
nomic sphere to which you and I
been
owe
into
Treasury
materials,
for their existence, their oppor¬
companies, with the object
of improving their management, tunities, and their security, and I
believe this minority
should be
widening the real participation of
operations
the
either
panies
projects and
power
take
companies that do not make steel
related minority made up of those people
who do not depend on business
newly-formed pri¬
the
by Mr. Wilson before the
Bond Club, New York City, Oct.
16, 1952,
this especially in respect to
of wage
because wages were not paid. This
almost
the
ment
small
candidate finds him¬
a
self in at the moment
begins
I
affects
suggestion that had to do tive business. If
transferring of govern¬ minority in our
a
with
one
although
candidates,
tank-town
some
made
few
of the
the
thoroughly
fortunes
luncheon of the New York Com¬ all of the people as does the doing
merce and Industry Association, I of some kind of private competi¬
per¬
of
with consider¬
for any apology.
see no reason
say
V
a
con¬
certainly not running for
You may
does
been
now
political speech,
a
haps I should take
it
weather
the
is
must live and
we
business today.
do
made
this
Since
verted into
waged—and
and
family, free pay
holidays, free
pay for vacations, and so on. Tnis
valuation, inflation, the question¬
hearts constant
and
unwavering is a very difficult point to make,
able
character
of
the
devices
have been forced and persuaded because any individual receiving
sometimes
employed
to
bring
into making compromises in or¬ these prerogatives and perquisites
about the increase, and the fact
der to keep the machinery going. naturally thinks they are a fine
that similar good fortune has not
The compromises were practical' thing.
Even management thinks
fallen to the lot of those depend¬
ones, and probably we could have they are a fine thing. Any one who
ent upon fixed incomes, but for
done nothing else, but it has hurt stood up and talked against them
the purposes of this observation
the cause and made it exceedingly would be drowned out in a mighty
the footnotes do not concern us.
difficult to get back on the rigm chorus. The difficulty lies in the
Likewise
the
savings
of
most
track.
fact that it is not the pensions and
Americans have
increased
sub¬
insurance and holidays and vaca¬
The Status of Organized Labor
stantially in recent times, even
tions that are evil, but the meth¬
We have seen a tremendous im¬
in the face of vastly higher taxes.
ods by which they are arrived at,
Hourly and weekly-paid workers provement take place in the status without
regard to the ability of
and
power
of organized
labor.
have added substantially to their
the business to pay for them, with
That improvement was inevitable,
holdings of government bonds.
fairness to all the other claimants
Against this development I and it was just. I am sure that and with preservation of willing¬
would like to suggest that a cli¬ intelligent people in professional ness
and
ability to save risk,
mate has now been created for management have no quarrel with
aspire and compete; without re¬
it.
But also before our eyes we
the achievement of another highly
gard to sound accounting or actu¬
have seen grow up an ugly and
desirable goal in American life.
arial practice, without regard to
powerful
dictatorship
of
labor the fact that if all of these
I believe we can advance to the
prom¬
leaders who came to power by
goal of a much wider ownership
ises are not to be just worthless
climbing on the shoulders of the
of industry and commerce,
and
scraps of paper, the money must
rank and file of those who labor,
that this advancement—if we can
come either
out of the increased
and then used that power brutally
bring it off—will solve many of
price the consumer pays for the
and frankly in their own interest.
the problems which beset us in
product, or out of the fair returns
And remember, that these leaders'
the fields of government and or¬
on investment to which stockhold¬
dictatorial
powers
are
derived
ers are certainly entitled for risk¬
ganized labor.
from their influences over approx¬
Jbieie lies, possibly, an effective
ing their capital. In one direction
imately 15 million workers where¬
cure for at least some of the irri¬
lies increased inflation and higher
as the total
work force embraces,
tating and costly differences be¬
living costs, and in the other lies
something like 62 million work¬
tween management and labor, and
the drying-up of risk capital. And
ers.
In the face of this power tne
this cure lies in the simple truth
the only "obvious" cure for these
whole concept of collective bar¬
that any healthy body does not go
conditions,
we
are
continually
gaining has gone down the drain.
out of its way to hurt itself. Here
told, is increased government par¬
It simply does not exist, ana neiwe have been led astray by words,
ticipation and control.
Who can
their does the public interest. We
and while this sounds a little like
deny, with a shred of logic, that
have had so many examples
of
nonsense, these words have been
labor's dictatorship is not driving
the power of this aictatorsnip thai
deliberately used to cause disaf¬
us
down the road to socialism?
it is hardly necessary to call any
fection by masters of the art of
The proof is before our eyes.
one of them to your attention, but
political "hetoric. If you will think
One of the most subtle dangers
the recent steel strike is one of
back to the beginnings of the vari¬
industry faces—and I mean work¬
the finer examples. In his column
ous
Deals—New, Fair, and what
ers
as well as management
again
about a week ago David Lawrence
have you—you must obseive that
—is the idea that a man has a
called attention to certain statis¬
there has been a definite policy
vested right in his job, no matter
tical aspects of the steel strike,
on the part of government during
whether he is an old employee or
which resulted from the investi¬
the past 20 years to redefine what
one
with a service record of a
gative efforts of Senator Byrd of
we mean when we say "industry."
week.
And again, this is a very
Here they are in sum¬
To me industry has always meant Virginia.
popular concept with any worker,
mary;
management and employees; the
as
well it might be.
It is against
By reason of the steel strike the human nature to refuse a paid-up
development,
manufacture
and
taxpayers of the United States lost insurance policy or: a right to a
marketing of goods and services;
and the whole process of doing just about a billion dollars.
As a substantial
pension,.; and no one
business, including the buildings, consequence of the diminished stops to think that hby the very
the
of
the
steel
companies act of granting the policy the com¬
machines, the research, the profits
during
this
period, pany behind it may be critically
records, the inventions—and the themselves
people.
It doesn't really matter $601,800,000 of revenue was lost injuring its ability to stand behind
what
part any man or woman by the United States Treasury. any such policy. From time imme¬
plays, under this big top—it all Approximately 60 million dollars
morial, a man's right to his job
adds
up
to American industry. was lost to the Government in has vested primarily in his ability
There is probably no other con¬ witholding taxes from steelworkand
desire to perform that job
cept in American life that so in¬ ers, which could not be collected well and find ways of doing it bet¬
example, about a month ago, in timately and
of the course of some remarks before the lives and
informed
yourself
been
But nevertheless I believe
talk.
I
campaign
it,
that this is purely
day
*
this
free markets and free persons;
keeping
be
.
the the belief that
the climate in which
or
bors,
action.
great
do is said
our
country, and what you
suspect, on rather high au¬
thority.
company
a
of
teaching,
or
be
freedoms
To¬
well
too
to be
manufacturing
be
But broadly speaking,
time-lag.
,
tiroes
course
with
license to complain of the
no
kind
the
with
Suspect
Of
and
out.
year
have
preoccuption with bail
than
Securities Business Now Held a
each of us,
of
dream that I would
ever
more
bonds
place, is the
proper sphere
Charles E. Wilson
share of
my
in the wildest
lives in
market¬
the
I had
never
gentlemen handle.
day
every
up
did I
one
ably
set
are
but
addressing the Bond Club. On
our side of town there was prob¬
where
polling
places
side¬
be
democ¬
racy,
could
the
about
walks of New York that never got
into any song.
an
and I
here,
things
you
vidual citizens
in
versa.
For my
tion, for indi¬
trial
affec¬
it high in his
hopes—vice
puts
and—he
tions
or
Thursday, October 23, 1952
.
.
should have kept their minds and
works to private interests.
ernment
-
teachers
Americans have doubled their in- 1 able success—we had to get on
with doing our daily work.
We
comes
in this period.
There are,
had to fight a big war and a little
of course, many footnotes to this
one.
And
the
very
men
who
phenomenon, such as dollar de¬
Mobilization
Former Director of Defense
as
.
'
time
over
spent
too
long
these familiar and
un¬
"Down the Road to Socialism"
pleasant things, but I meant them
primarily as background for what
From force of habit I
follows.
am
almost
tempted to apologize to you when
I say that in my personal opinion
we
have progressed far down
in
road to
to
we
are
the
socialism—simply because
told so. many times every
a
All of these
sound dollar and
a
obstacles to
sound
econ¬
be at least partially over¬
come, I am convinced, by the ex¬
pedient of supplying a broader
omy may
base
of ownership .of the tools of
Volume 176
Number 5162
production—those which
lst
and
to
come.
the
many
These
The Commercial and
Financial Chronicle
.
ex-
original
that
are
rangement.
constitute
transaction,
states and
could
by
is that only the government can
operate such a project in the pub¬
lic interest. Both of those
argu¬
pre-ar-
the
Looking down the road for the
system *n next
decade, it seems certain that
pnse
we
.
now
more
United States.
Suppose
.
sell,
by
called
a
municipalities
ments
to be
are
to provide far
upon
great variety of plans, our 15 milorganized employees an in-
throughways,
terest
in
the
corporations
related
for
which they work, as well as in
the
whose products and
services they purchase? Would not
corporations
the
benefits
I have
this
seen
bridges, and
works
than
lic
=====
and
that
resources
This Week
broadly
ready,
as employees acquired their
first stock
ownership in their own
company and cautiously began to
recognize their rights and obligations as owners of the business,
it has been evolved, is in itself
a partial recognition of the soundas
falacies
the close
280.29
On July 3 "Barron's" insurance group average stood at 162.47.
Stocks of insurance companies were strong the first two weeks in
July and the group average reached its high of 165.65 on July 17.
Since that time shares have declined small fractions and the aver¬
of this proposal. So far it terest that a business understand¬
does not always fully get away
ing be efficiently and productively
-Workers, by and large, now have from the concept of government
operated, so that it can pay taxes
the savings to make such
invest- operation, but it at least
adopts the and
ments.
Unions
themselves
such funds available.
ply
occurred
never
have
It has simto
They would be
ring their savings from
transfer-
into the bottomless pit of
form
one
of
investment to another—but admittedly would be joining the
mon government
tory
Why mot take
step in all such cases—let the
try with its risk
savers buy into such projects. In'time they took some of the
risks, vestment is a great incubator of
in response to restored
incentives responsibility, either for business
that are
adequate, along with the or for public works.
J
*
ranks of those who
I
operating budget,
the next logical
prerogatives
and
perquisites—al-
'though the package could
be sold
^
\
You
essentially
none
the
.
intended.
was
of them
intrinsic, interest
the
separate
est
of
ance
4
stock
averages
about
has made
group
net gain of 14.69 points.
a
;
:.
In view of this, most of the major insurance shares show
gain for the year. Of course, there are exceptions. V.
each
project,"but in the inter-'
the
insurance
'
"Barron's" insurance group average, on the other hand, started
the year at 146.30. The
group reached its high of 165.65 on July 17
.and on October 16 was 160.99.
Thus, for the year so far, the insur¬
investigated, not only
of
for the
.
possibilities and■*'
in
that
The Dow-Jones Average of Industrial Stocks started khe
year
The high was reached in August of 280.29 and as
of Oct. 16 was at 264.87. For the
year so far, the averages have
thus declined 5.51 points.
I believe that most
real
are
and
1952 at 270.38.
recognize
suggestions is
be
r
group even more.
private
government.
should
160.99.
was
A comparison of the performance of the two
groups since the
first of the year shows a similar pattern and favors the insurance
immediately
of these
5.5%
2.8%.
full-blown, ; none is worked out
in detail, and nothing like that
\
and it does
Works ,
If you by the con- J'> Why not reverse another
trend
,;cept of the real unity and inter- of
the-past decades and encourage
;
dependence of all segments of private companies to take over
has been
busi-
any
Post Office.
from
will
that
overll,nen^ Should Sell Public y
never'
back
businesses
that basis
on
intelligent
an
1*3, the latest available,
Thus, the decline for the Dow-Jones Averages from the high
•
to have
seem
buying
•not need to be.
its his¬
suggested today
number of things in this area of
a
supply induscapital. Isn't it
in
operator of
ess—look at the
age on Oct.
employment.
never
itself
proved
and efficient
com-
a
stable
Government has
toll highway—and making it pay
for itself, instead of dropping it
of
many
-them.
supply
concept of segregating the specific
need—whether it be a bridge or a
on
How have insurance stocks acted during this same interval?
theory of public
It is to the public in¬
ness
by the Dow-Jones Industrial Averages, stocks at
July 1, 1952 were at 275.46. After reaching a high of
Aug. 11, they have since declined, reaching 270.43 on
on
Oct. 14, and the subsequent decline of last week carried them to
the low of the period at 264.87 reached on Oct. 16.
the
of
ownership.
Insurance Stocks
—
As measured
biggest business
job that faces it, and this has been
proved again and again. And so
far as the public interest is con¬
cerned, this is one of the great
to private citizens. The device of
the municipal or state "authority,"
=====
The general stock market has made little
progress over the
past 3% months. Indeed, the recent decline has brought the aver¬
age close to the lows of this period.
supply reality
are
happen al-
JOHNSON
of its
sum
authorities can be created and the
securities sold much more
By H. E.
interest, is
no bigger than the
private capital. By it¬
self it has
nothing that it can lay
on the line.
It is private
savings
their
to government
capital, and noth¬
terrifying from the standpoint ing else. The United States can
of both engineering and cost, but always organize a
company big
they must be solved. Here again, enough to do the
be
tangible and immediate, in employee relations, in
productivity, and in making the
so-called "demands of labor" more
realistic, just and fair? In a small
way
ramps,
public
Bank and Insurance Stocks
their face.
on
government, which consid¬
itself the guardian of the
pub¬
ers
borrowing power will permit, regardless of the inevitable needs of
the time.
The traffic
problems
ahead for all metropolitan areas
lion
ridiculous
are
The
more
,
broad
-
a
proposition that
Some-of the casualty companies engaged in writing automoindustry, what-bet- public transportation facilities, as"
wider participation- in the owner-...
lter glue of common interest can in c New
-bile lines have continued to suffer from the unfavorable under¬
York" City,
where six
ship of business is in the best in¬
you find than employee
writing experience which has existed on this business. Although
participa- transportation systems have gone ;
terests of the, United States and.
tion
there are indications that the business is
individually and through back to private operation, for
turning around as a
•business
and
"
•
.
•
—
,
"unions—in
ownership of the
en-
greater efficiency, and; at
its citizens. We know in
bones
our
result of rate and other
v.
adjustments,
the shares have not
yet responded.
investing ;public, of our
greatness as a people is
^willing, - indeed eager, to have the owning - public, become the
Among the fire companies business has continued to be gen¬
free competitive
savers get fair play for the work
enterprise,; and
dominating influence between the for the life of me I
cannot under-; erally profitable and there have been a number of favorable
their savings do?- Political reme"company" and the labor-cowed,
■
stand why we tolerate a whole: ^•developments so far as stockholders are concerned. dies for some of the troubles I political
machines. The investing
hose of fringe activities -designed •
;
.
From the stockholders' point-of view the most important of
•have described may turn out to
public, if the base is broad enough,; on
these have been the increases in dividend payments. Distributions
the opposite principle.
-be illusory or
When
impossible,, and I is better able to cope with the de-.
for
-terprise
itself and
in
making all
profit.
-
Let
a
decent
that the economic
the
source
and basis
some of.
-
,
•
-
•
not
;am
that
naive enough to believe
simple change in party in
a
will
power
guarantee
lasting
a
^revolution
against the Deals. But
parties and politicians,
•administrators
and
legislators,
•political
have
we
mantis of
a
Mike
Quill than is
political machine,, which can't
won't.
'
V. V
;
a
or
.
Several years ago I was led into
this
its
,
idea
power
of buying back public
projects from the govern-
a
a system that has proved
worth, why not use it. Why",
must
:■
way of adapting themselves < ment by the debate which
raged
.eventually to the wishes of the over such undertakings as the
•majority, even though it some- Tennessee Valley
Authority,
times takes them a long while to There were
many sides to this decount. Perhaps our real
job, then bate, as you know, and I was on
•is to create a majority of Amer- a
couple of them at least by virtue
;icans consciously on the side of \of
having spent my life in private
•business, by virtue of being a part * business and in the electrical in-'
;owner of
business, and let the po-• dustry.rBut one of*the cries'that'
•litical chips fall where they
may.
went up the loudest was that tax-'
;Of course, in my book, this con- payers in Ohio or Montana or
iStitutes political action of a high Maine should not be made to
pay
that
be hell-bent
we
socialism
traditional
when
is
on
better
proving
than
one
in
system,
of them has ever
the
history
of
the
world?
You
would
stand
be
political
a
on
that
warned
were
this
it
is,
just that and no more. We have
nothing to fear from political ac¬
tion—direct political action of thekind I am recommending—except
results.
So
far
This
-
the
results
over
-
the
year
recent
include
ones
Fire
St.. Paul
&
Other
increases
This should act
as
are
expected
stimulant
a
or
support for insurance shares.
In the tabulation below, we show
the
of
the price changes of
leading companies from the beginning of the year
Oct. 22, as well as the
price
range
so
Market Bid Price
American
Surety
511/2
49%
62%
to
selling
all
or
a
share in busi-
almost
all
and
electric
projects; the
plants; also the
-electric power generating and distribution
projects in connection
synthetic
with
atomic
The
latter
well
can
power
rubber
there were enough of such people,
be
buyers, fix the price, and sell
The stock
should
be
made
available
to all Americans who
interested in buying into this
are
exciting
very
course,
one
future,
source
of
and,
of
money
•'
to
...
pay
for the securities of the
new
companies operating these gener- "
ating and distributing facilities
should be the
ernment
held
of
so
presently-held govsavings bonds which are
abundantly in the hands
private citizens.
,
...
corporate
ment
in
say—a
dam
entity
When
,
.
has
government
a
a
new
.
taken
pay-
bonds for—
billion dollars for
and
a
giant
generating plant, the
'
,,
,.
.
.
company could use these bonds to
pay
of
fthe
f"0*1 a soun(* project. Obviously
ludgmg^by the noise they made,
should be privately operated. The
government should set out to find
them.
possi-
plants
power
regarded as entities
separate from the atomic energy
installations themselves, and they
the
^vestment
hility io people all over the country who had capital to put to work
anc* w^° thought that this was
installations,
energy
electric
up
government
for
the
ing minstrels, and went to work.;
ino
George Lincoln Shaskan,
mem¬
doing business
as
an
DETROIT,
Mich.
Company
—
Vinton
Jones has become associated
&
Co.,
Penobscot
E.
with
Building,
change,
by the government administrators
and economic planners is that
such
a Pr°ject is just too big for private
capital
government
to
can
handle;
do
only
the
something
that
big. The second counter-argument
Boston
+
1%
59
51%
-f 12%
83
67%
___
Insurance
as
27%
22
1%
531/4
47%
623/4
69%
-J-
6%
70
781/4
+ 14%
88
72%
75
Federal Insurance
87
95
2%
+ 8
+ 6%
+ 10%
+
%
Fidelity-Phenix
Fire
_
__
Association
_____
-
Fireman's Fund
70
__
____
American
Hartford
Home
23
Insurance
25%
+
59%
+
Fire
__
79%
683/4
68%
55%
58%
513/4
27%
22%
62
53
21/4
5%
38%
33
391/4
32
+ 17%
151%
131
34
361/4
+
38
+
132
68%
87
2%
61/4
321/2
______
Insurance
561/2
53
(Newark)
Hanover Fire
76%
66%
55%
Phila.
63%
78%
95
+
56y4
-
of
*
Low
4%
+
—
631/2
Continental Casualty
1491/2
38
+
2%
39%
70
841/4
+ 141/4
871/4
Phoenix Insurance
841/2
991/2
+ 15
St. Paul Fire & Marine
32
32%
+
30%
31%
37%
+
39
311/4
Springfield Fire & Marine
44
50
%
61/4
+ 6
35
Security Insurance
541/4
44
United States
411/4
43%
+
21/4
46%
38
23%
+
2%
251/4
21%
Ins.
351/4
_
34%
^
Co.
North
of
Westchester
America
Fire_
Fire
_
_
_
211/4
_
to
The
Financial
.
104
70
81
COMPARISON
sales manager. Also as¬
Botterall
with
Trust
H.
has
B.
become
Cohle
Building,
Cincinnati
and
&
sociated with the firm
are
AND
ANALYSIS
Chronicle)
17 N.Y.
associated
members
Co.,
City
Bank Stocks
Union
of the
Midwest
Stock
September 30, 1952
Bulletin
Exchanges.
With Walston, Hoffman
(Special to The Financial Chronicle)
Charles
CLEVELAND, Ohio — Hay ward
P.
White, Alfred P. Allis and
K. Kelley is now with Walston,
Mabel Lempke. All were formerly
Hoffman & Goodwin, Hotel Holaffiliated
with
Baker, Simonds lenden. He was formerly with
& Co.
Price Range
High
Continental Insurance
(Special
which you
the head
56
80
•
Insurance
CINCINNATI, Ohio—Arthur C.
Carr &
Carr
over
54V2
671/2
Fire
With H. B. Cohle
Four Join Staff of
members of the Detroit Stock Ex¬
get hit
Change
individual.
m?0 first *or J10W ^ all started.
JPuf^
The
counter-argument with
Aetna
Great
Formed in New York
run
cas" "rawer-
Point
1952
Glens Falls Insurance
.?° more than use the ber of the New York Stock Ex¬
governments own figures (and change, and Paul. N. Shaskan will
w^° was ° .say ^a^ ^ey were form Shaskan Bros, with offices
no^- accurate) such a project, if at 40 Exchange Place, New York
wej .™n' w?uld produce revenue, City, effective Nov. 1. Paul N.
pay a return on m- Shaskan is a partner in Shaskan
vestment, it could also pay taxes, & Co. George L. Shaskan has been
hadly run. The best guarantee
yo.u nave of efficiency is to have
Pnvate ownership because by that
you *naure that somebody is
ground to run the store and watcn
Oct. 22
1952
Firemen's
Shaskan Bros, to Be
^ you
£;n<*
0011 !£n
?° ehher of
these things, the chances were
Hj **
n
a ?P°? Pr°Ject in
£lrjf P^ace, Thothat it was beor
hflrilv
Jan. 2
so
Ameri-
present government-owned water
,
1952
26%
granted, for the purposes of argu- stay strong enough to pay- our
bills and those of a lot of other
cans, we should not only contem- * mer,t> that a TVA was a good and
plate our present industrial and nee(*ed thing, it seemed to me that people. Our progress during the
last twenty years has been in spite
commercial
enterprises, but we could solve this one argument
of and not because of. It is time
should obviously look afield for
y letting the people of
we
got back on. the- track, paid
new ones.
In this prospectus for the Tennessee Valley pay for it
off the piano player and the stroll¬
.the future I would include the through investment, and in fact
'osition of
jness
serve
to
have
been
22
not
some
up
far in 1952.
Insurance
projects which did
the whole country but only a relatively small/part of it. ilf we
their quar¬
the next several months.
over
a
American
prop-
of
year
terly rate.
Agricultural
considering the overall
Firemen's
Continental Insurance and Fidelity-Phenix increased
forms of economic suicide and still
In
for
Marine;
Newark, and Fire Association of Philadelphia. Earlier in the
pretty good. They have been
good that it has made it pos¬
sible for us to enjoy the luxury
of
experimenting with various
order.
the years,
there have already been several companies which
have increased their rate of payment over that of 1951. Some of
speech, and:
the premise that
Increases in investment
income have permitted modest increases
•
the
American
only
worked
I
several years have been conservative.
have
Ball, Burge & Krause.
on
Request
Laird, Bissell & Meeds
Members New York Stock Exchange
Members
120
New York Curb
BROADWAY,
Bell
Exchange
-
NEW YORK 5, N. Y.
Telephone: BArclay
Teletype—NY
7-3500
1-1248-49
(L. A. Gibbs, Manager Trading Dept.)
Specialists in Bank Stocks
20
The Commercial and Financial Chronicle
(1536)
expensive undertaking borrow it to cover the excess of. January, but $79 billion; still an
enormous figure even in
Federal
with; and it continues Expenditures.
Government borexpensive year after year. Gre&t rowing- from the public may have budget history, and $10 billion
more than estimated receipts. Re- c
capital sums are required,, not ,a slight tendency to reduce pri-;"
ceipts may be a few billions more
only at the beginning, but to de- vate spending,, but government
than
$69 billion, expendtures a
velop and expand each enterprise, borrowing from the banks results
few billions less than $79 billion;
We are told that $27.5 billion will in the creation of new money. It
but
the
general picture is not
have gone into the development js as if the government used the
likely to change.
and expansion of our industrial printing press directly to finance
The next budget year will be
plant during 1952. How much did its
excess
expenditures.. Thus the
period from July 1, 1953, to
it cost to produce the first nylon government expenditures financed
June 30, 1954. The Budget Bureau
filament? How much is it going by borrowing are not offset by a
is
now
assembling estimates of
to cost to produce all the nylon reduction in private spending, and
proposed expenditures for that
and dacron and so on that are So the total demand for goods and
year from all the myriad parts of
needed now? What will it cost to services increases. If output does
the Federal Government, but noth¬
dig iron out of that mountain in not increase correspondingly,
ing official has appeared or can
the interior of Venezuela; to ship which is the case today with pracappear for months. Hence no one
it down the Orinoco and up the tically full employment, prices are
outside
the
is
When Can Congress Reduce Taxes?
By ROSWELL MAGILL*
President of the Tax Foundation
Former Undersecretary
.i
r
of the Treasury
<
.
-J-
r
Asserting tax burden must be reduced unless goal is "Socialism
in our time," Mr. Magill forecasts expiration dates fixed by
Congress in last tax measure will not be extended, and thus
tax
will be reduced
revenues
policy of
by $2.7 billion.
where government
expenditures
find
four
themselves
multitude
question is
surrounded
issues.
of
Americans
years
by
^
whether
buy
suit
or
Ford
to
new
a
how
or
send
nie
to
to
new
a
John¬
Rather
the
government
these
Americans
we
most of all from
want
government?
our
We may think, first, of
ities as good roads or a
such util¬
big navy;
fundamentally, I think we
the government to accom¬
want
Taft
the
to
want
we
be worth
Hartley
-
is today.
maintain
Act be
Roswell Magill
ed?
-
h
—
repeal¬
Shall
a v e
Candidates, at least successful
candidates, cover their answers
appeals with liberal coatings
of political sugar.
security
payments
creased.
There must
for
must
be
be
in¬
generous
have
do
an
deficit.
Federal
enor¬
We
have
had Federal deficits for years, and
we're not ruined yet.
Each par¬
ticular
Federal program was de¬
vised to be good for someone, all
except the tax program.
and
tuck
in
too
increase
even
all
things; and then take
the
everybody
are
Why not
tax
system
happy?
heavy.
Taxes
Can't
a
to make
we
really
reduce
end
dollar,
to
ever-
end
an
There
demands
to
for
hard to live
so
it
government
decently
give us
We can't buy
hoping for it. We can relax
peaceful ourselves, but the
or
and be
fellow
other
them, first on ourselves, as indi¬
viduals, and then on sales and on
corporations
Why not?
for
Fiscal
fast
experts
the
budget
but
many
man
we
know
may
should
a
as
can?
why
be balanced;
called a fiscal
only by being ready to fight
it—successfully. We must have
armed forces big enough to guar¬
peac^
antee
tacks
defeat
to
who
anyone
at¬
We must believe enough
us.
expert is not singing that particu¬
in
lar song this year. How many lay¬
force
men
navy, even
are
derstand
ihere,
anyway,
who
un¬
half of the billions
even
in the Federal budget? How many
can resist the siren
appeal of all
these good things that we can ac¬
quire
by
spending:
flood-free
a
maintain
to
peace
and
big
a
a
big
and a
army
air
big
at great cost. We can't
rely, as we used to think we could,
on a
volunteer army that springs
to arms at the first sipn of
other
No
protect
Missouri Valley, for example; and
a West -• lihout a dust-bowl?
Any
id balance the budget by
cutting spending is a program of
self-denial for some group, and
self-denial is not very popular.
from
danger.
country will be able to
this time while
us
we pre¬
pare.
program
What do
gain by denying our¬
selves? Isn't the talk of balancing
the budget simply a negative pro¬
gram, to
cut off tangible good
things of life, in favor of an in¬
tangible fiscal idealj?
we
Confronted
all these
with
con¬
flicts and cross-currents, the citi¬
zen
for the candidates and
yearns
the experts to work out for him
rational
knows he can't review the Federal
program, nor our
national aid.
On
the defense
plans for inter¬
nor
budgetary and
matters, the experts ought
help him. What have
fiscal
to be able to
we
start,
we
must decide what
expect from our government.
Then we can take a look at the
we
things
can
budget,
we
look
taxes
we
Fova
1
want.
at
the
pay,
address
Bankers
Oct.
attack,
the
first
the
cost
And
of
finally
the
we
annual
and
bill, the
decide if we
22,
by Mr. Magill before the
Association, Des Moines,
1952.
When tax rates on
rations and
If
are
strong enough, if we
plenty of planes and men,
and ships in apple-pie condition,
we may not need to use them. Our
enemy can't afford to lose a great
war, so they won't start one until
discussion
of the posals of the different bureaus and
spending. The departments appear and the heat
of its
corpo-" ment
own
shiftless
manage-
is
fiscal affairs is
for the depreciat-
the first reason
have
cabinet
that
they
are
decided
Conversely,
has
continue
taken
to
take
chunks of the earth that
any
well
not
win.
adversary
will
and
over
solemnly
will
main
our
and his
man
dent
that
only
keep
defended.
we
It
ourselves
is
evi¬
must
not
is spent for
availability. In
current
Itoo high taxes
sense,
fense
rule
to
strains
a very
and
stresses
measure
We
tolerances exactly.
and
but
how
world
much
we
of the
must
be
rest
of the
prepared
to
without
dustrial
we
rely
strength quite
as
on
is in¬
much
as
even
vidual's and of
work to
about
decide
more
earn
gone.
not
incentive
international
continue to
enemy
arms'
race,
out-produce
in order to survive.
To build and to maintain
industrial empire at top
a
great
efficiency
millitary services, in¬
of
one,
than
too
-
fi-
the
it
but
course,
and
two
civilizations,
all
have
to
is
would
we
incentives
the
working for
The
us
and not against
us.
conclusion, then is, that to
have peace as a nation we must
be
improve
must maintain it and
it.
must
That
make
sure
means
that
that
eral
for cuts in the next
budget.
Recently,
the
Committee for Economic Develop¬
to
means
we
billion could be
Department of
Defense
"without impairing the
effectiveness of the security pro¬
leave individuals and corporations
invest
the
new
and to
save
that
complished.
o
money
can
de-
that be
ac-
The essential step is
balance the Federal budget and
When
acquired
it in balance.
the
by
goods
the
services
government
paid for out of tax
money,
are
when
is balanced, then the
total supply of money does not inbudget
value.
and
the
dollar
On the other
balanced
retains
hand,
budget 'means
government is spending
an
that
more
of
$4
achieved
in
the
grams." These savings would re¬
sult from better procurement pro^
cedure, more standardization, and
more economical methods of con¬
struction, design and production.
The non-military
side of the
also.-contains
budget
ducible
large
re¬
Although Congress
areas.
substantial cuts in
made
its
un-
the
than
last
the cur¬
We cannot have
unless
we
are
budget into
willing to put
the
Then
must
we
it
nation
be
done?
and
It
can,
Federal aids and subsidies,
as special federal services
to agriculture, labor and business
but the —$9j/4 billion.
determi(d) Sale
of
loans and - com¬
(c)
as
as
self-
as
Manhattan
a
directory;
that
it
t is
telephone
comprehends
Moreover, the present is
nearjy the worst time in the
outside
anyone
Bureau
to
year
the
Budget
any
propose
cuts
changes in the budget. We
are
in
Budget
appropriations
for
peri0d ending next June 30
ago
and
cannot
now
The Administration
in
the
actual
the best will
scale
some
be
can
the
were
months
altered,
economize
spending, but with
in the
world, large-
accomplishments in current
budget reduction
are
The Administration
timated that
during
fiscal
impossible,
recently
es-
budget expenditures
1953
are
expected
of
been
Committee
the
billion
Corresponding
cuts of $8V4
budget.
$10y4
billion could
made in the
cuts
These
have
1953 budget.
would
enable
•
the
budget to be balanced and a sub¬
tax reduction would be¬
stantial
come
specific
the middle of the fiscal year 1953.
1952
in
thousands of items and billions of
dollarg
areas
recommended
We all know that the bud
for
these
In
III
bi
well
modities.
denial,
as
Loans—$2V2billion.
Civil
public
works—$l1/&
billion.
not
are
well
as
program
-
enormous
skill,
for
following areas:
(b)
with more taxes,
cut expenditures,
up
j
■
out as
cuts, and the elimination of waste
(a)
We
'
singled
targets
particular
willing to bring the
balance.
*
Committee
The
stable dollar
a
Tax
Chairman.
was
„
the Committee on
Policy, of which 'I
by
year
Federal
for each dollar spent,
adopted by Congress
and
saving
a
we are
individuals
produce more. It further
that the government must
enough opportunity to
room
concluded, after study, that
ment
not getting a dollar's worth of goods and services
big; that
have the incentives to do the work
and
balanced
a
military
be
home; that the FedGovernment has grown too
Can
we
level and
of
possibility
certainly
do
should
that
to
nearer
task demands
magnificent productive
trying
is
things
many
done
lies in
machine:
military
will settle
bring
budget
lower
had
Washington
strong. Our fundamental strength
our
the
a
budget nearer to reality. There is
high.
too
are
in
to
the
or
have
We
that
between two forms of government
crease
must
\
hope that the
can
down
the mink coats and deep freezers;
potent. And in this struggle
very
place in the -world by out¬
producing the other fellow. In the
present
,.
budget
plenty of rent budget, negligible amounts
demonstration lately that there is were cut from the $18 billion "re¬
area
as
recommended
a lot of government waste among ducible"
to
vacations. There
eight
are
tory.
income is just
incentives
other
nancial
indi-
an
The earner is apt to
to try to earn more,
but to take longer
the
we
expenditures
They
,a
corporation's in-
a
financial
the
come,
are
of
three-fourths
than
military strength. We have made
our
We
items
nine times what
slide-rule, - it seems certain that they were in 1940. They are nearly
the government is taking from us twice what they were only two
in taxes just about as much as years ago in ,1950.
The current
it can, if the enterprise system is budget is $10 billion or more out
to survive. When the government of balance, despite the largest tax
takes over the spending of more collections in
the country's hisNevertheless,
eep
ies fear and that
total
1954.
also convinced that Fed-
are
eral
stable dollar. How
ourselves;
the
spending is not expected to
off until some time after
taper
are
whether
will defend
of
difficult or ini- ing dollar. Most unfortunately, cluding foreign military assistance
possible. Too high taxes strike;a bad fiscal management has been and foreign aid generally. In the
blow,
then,
not
only . against coupled with extraordinarily high current year the military plans to
thrift, a fundamental; American expenditures, so that impact has spend $47 billion. Even so,"' the
Defense
Department will, >; fiave
virtue; but against the ability -of been doubled.
our
enterprise system to defend. ■ There are.: only two ways to. available $56 billion in Ueft'Ever
and to perpetuate itself. So far, bring an unbalanced budget into authorizations and appropriations
enough savings have been "pro- balance: .either by raising taxes at the beginning of the 1954. fiscal
duced; but the current successful 'to cover the expenditure total, or. year next July 1. While* the ^re¬
demands for higher interest rates by." V-trimming
expenditures
to quests for new authorizatibh^.next
indicate that the need for new bring
them
within
the
total year will probably be below this
year's appropriations, actual de¬
capital may be greater than its revenue.
veloping enterprises require.
(2) All of you in this audience
want the government to give us a
we
"
on.
is
saving
high,
powder dry, but
maintain large forces ready to use
the powder at a moment's notice.
The
great problem here is not
our
really
Two-thirds
own
we
and unless their head
yourselves
are
you
government controls
five
individuals are too
on
and you
lucky, for
on;
.
their government's
reasonable government's
in the hope of a
return.
count
can
has
Bureau
figures to work
any
bound to be spared any
of budget figures. All
we can hope to do is to lay down
Fundamentally we don't need some * general
propositions,
to
more
government
controls
of which we shall try to adhere in
prices so much as we need effec- the months ahead, when the pro¬
far,
like
have
our
*An
first
The strength that our adversar¬
II
Federal
- the primary cause of the increases
capital for our great in the cost of living, and of the
enterprises has come, not from the' decline in the value of the dollar,
So
defend.
to say?
To
the
hostile bomb.
over
guiding principles,
which he and they can apply to
all these specific problems.
He
budget personally,
We must be ready right from
the beginning to protect ourselves
a
set of
have been
Unbalanced budgets
Maryland or Pennsylvania?
can
obviously
doesn't
want to. Strangely enough in this
world we live in, we can have
as
bound to rise,
throuh
ore
real
It is not necessary for me to
whisking spend time trying to prove to you,
away the golden eggs as fast as or indeed to any other American,
these two blessings.
the goose lays them.
that taxes are already too high.
them or make them for ourselves.
The solution of fiscal problems, Any of us can prove that point
But being citizens in a democratic
as
of other problems of political any day from our own experience,
state,
with a national election
right in front of us, we can choose science, demands the exercise of We all want to see taxes reduced,
the men who support the policies judgment. We must balance one We would like to be free to spend
possible use for our earnings — more of our own earnings in our
that we believe will achieve the
savings and investment; against own way — a privilege that has
ends we desire.
What are the policies essential another possible use —: govern- been taken away from us bit by
mental expenditure on defense or bit, piece by piece, in recent years,
to peace and to a stable dollar?
(1) We have found in the years' payments to .veterans or farmers' Hence neither our Congressmen
since World War II that we can't parity or whatever. The rules are nor we ourselves have any stomhave peace merely by wishing for not precise, and there is no slide-' ach for further tax increases,
Only
Social
rehabilitation
the
we
these good
an
and to plan for the future.
and education of veterans.
maintain
be
makes it
Farmers' parity
prices must be maintained.
mous
of the
value
be
increased
living costs; and an end to the
resulting inflationary spiral that
and
Suppose
it
as
increased wages to meet
about Korea?
provisions
the
would
could
do
we
much tomorrow
as
If the government would
increasing costs of living.
143-
a
wing air force? What shall
there
we
Budget
and, finally, to put the
a
blast furnace
in
Atlantic;
money
maintain
well-being of Amer¬
television set
ica.
That
means,
among
other
ring
with
great national things, that we want the govern-,
problems: ment to give us a dollar that will
Second,
the economic
Shall
.
recurring wars and emer¬ it, and were willing to risk
gencies.
and the
papers
very
begin
government, but from private inplish for us two great things.
First, we want our government, vestors—from the earnings of the
to strive for peace in the world.- enterprise itself, or from the savWe want a stable society and an
ings of persons who believed in
end "to
college.
all
do
What
but,
personal one:
>
areas
programs.
a
The
burning
longer the intimate,
inte resting
no
Spartan
a
a
to
,
be reduced.
can
afford
can
Every
Says
offset this loss, and points out
economy can
1952
Thursday, October 23,
.
.
.
possible.
The best work any
in
of us can do
period between budgets
try to settle on improvements
budgetary
procedure
which
this
is to
in
will make
thus
of
a
a
balanced budget and
stable
dollar
more
likely
accomplishment.
First,
ceiling
Congress should place a
expenditures, withi*
on
which the Budget Bureau and the
Administration
operate,
higher than
from
tax
as
it
and
a
whole should
should
anticipated
laws
on
not
be
revenues
the books.
The
burden of
determining allocations
should be placed squarely
it takes in from taxation, and con- to be, not the $85.4 billion
the and cuts
sequently it must print money or President originally proposed in on the Administration.
A
budget
Volume 176
Number 5162
...
The Commercial and Financial
Chronicle
(1537)
of
the
current
size
gives ample
leeway for all necessary programs.
No
new
should
programs
be
increases
effect
in¬
The
stituted without specific
provision
for
financing them.
Second, the Congressional Ap¬
propriations
recruit
Committees
should
an
Committee
On
Internal
Revenue
Taxation, to assist the committees
in
the difficult tasks of
general
scheme
of
in
the
prepared
job
to
do
after
year
pays
gird
get
and it is
them. Our
our
Grounds for
loins, and march through
own
our
Red Sea to the promised
land
hope to find.
we
Mr.
Babson, predicting, barring World War III, there will be
of conditions such as existed in
1932, gives as
reasons:
(1) protection of mortgages by Federal
Housing
;Agencies; (2) the 75% margin requirement on stock trans¬
actions; (3) prevention of big business failures by
RFC; (4)
strong position of banks, and (5) farm price supports.
Says
brightest factor in situation is heavy spending on wise adver¬
Charles C.
King Is
Celebrating 25 Yrs,
earn.
with
gone hand
,
inflation, with the
result that,
notwithstanding large
increases, very few of us
wage
have
been
living
able
to
standards,
maintain
much
tising, salesmen, and educational training.
According to the Cycle Theory
ahead. A married couple with two
better
even
1939
and
$2,000
a
could
business depression may be due
thing
get
children
be
return
our
less
income
a
in
during
the
When
needs
an
income of $4,200
sinr.ply to maintain their
position, after taxes and inflation.
at
be
review
a
next
year
*
the Congressional desire to reduce
total expenditures
have
and thus to give the
merely
the
materially
from
excessive
citizen relief
taxes
is
blocked
by authorizations already
books
for
all
sorts
of
the
on
continuing
programs,
indefinite as to time
and amount. This "uncontrollable"
part
of
the
budget
needs
to
grealty reduced in line with
ent
realities.
told
Senator
Byrd
the
on
30,
1952,
the
Add
pres¬
has
that the total of authorized
us
appropriations
June
be
new
books
$91.3
was
appropriations
to
that
figure, and the total is a
colossal $172 billion. These enor¬
mous
figures show why there is
much
so
appeal
and
logic in the
Congress
should
that
^proposal
wipe the
slate clean
thorizations and start
How
lable
au¬
again.
balanced,
stable,
outstanding uncontrol¬
as
expenditure
greatly
budget?
so
authorizations
the
exceed
annual
IV
at
long last,
taxes.
Our
Federal
ture
for
cries
for
reduction.
we
come
tax
struc¬
improvement
The
and
struc¬
present
ture
literally
were
to propose a new set of taxes
is a mess. If we
could start fresh, and the problem
to
for
prospective govern¬
expenditures, no expert
or
Congressman, I think, would
ever propose the tax structure we
pay
mental
have.
now
total
'our
Most
with
agree
1939?
the
tax
experts
laity,
burden
would
first,
that
is much
too
couple
the
to
their
1939
position.
off
Who,
today
then,
was
in
What of the slogan that we
had it so good?
never
The fact is that
promotions
substantial
even
and
increases
wage
When
the
tax
screws
were
last
10
11% increase in the individ¬
or
ual
income
tax
(December
31,
1953); the 5 percentage point in¬
in the corporate income tax
crease
(April
1954);
1,
and
1954).
In
lion.
In
allowed
termination
$8.3
bil¬
year
1954,
reduced
all
to
the
increases
expire
dates.
about
their
on
Shall
the
re¬
peals be allowed to take effect? I
think
(1)
a
the
answer
The
is
sense,
theless,
the
welcome
repeal
would
recognition
too
are
high.
be
that
Further,
it
the
pretty name,
evil. The current law is
piece
of
bledegook,
that
in
the
to
lapse,
ought also be allowed
primarily
because
a
50%
levy
on
income
is
high
enough. In a free-enterprise econ¬
omy, the government should not
of
more
a
corporate
have
must
and
are
(4)
vigorous expanding
vigorous corpora¬
a
economy,
tions
principal component.
a
Finally, many of the excises
high. The excise tax sys¬
too
are
and
law
and
gobwill contend
few
is
successful
at
all
ordinary
profits.
encourages wasteful
for
of
the
Treasury
them.
The
new
on
than
tax
on
old
to
tax
much
adequate
study.
should
The
It
be
has
tax
most
harder
enterprises
established
written
was
(2)
paying
is
to drive
promote
without
and
is
development
serves
thus
tax
The
expenditures,
ones.
The
prices up and
inflation.
The
and
adopted
consideration
worked
badly.
repealed.
individual
income
tax
Louisville
Bond
some
so
at
all.
The
rates of tax
less than
to
do.
We
the
lower
need
of
shall
all
not
the
vision
other
that
example,
law
in
1953
and
seize the
the
the
kinds
restatement
re¬
in
not
the
of
intelligible
more
election
an
the New
York
firm in its
608
other
and
a new Congress should
opportunity to overhaul
ahead.
said
repeals
earlier
budget. In
Dominick
trade
has
in
and
of
and
Federal
connections
investment
fields.
of
the
been
"Newsweek"
connected
financial
as
to the
P.
A.
office
Benneche
of
Thomas
D.
joined
with
Benneche,
J.
had
A.
Ritchie
the
L.
Allen
Childs
and
&
&
Co.,
Company,
Sherwood
C.
&
F.
Co.,
sound
We
dollar.
spending
bring
it
taxes
are
kept
a
Consequently,
must
be
within
cut
down
Before
revenues.
cut, and
to
revenues
there¬
refer to the
billions
wise advertis¬
on
models!
When
in
or
the
last
country
depression
was
struck,
the
unprepared, with
no
economic army, navy or air force.
But, today
we
have in
reserve for
of
unemploy¬
special use, in
ment,
sales
a
case
army,
ing navy, with
force.
air
into
a
These
advertis¬
an
radio-television
be
can
thrown
activity at the drop of
So long as
people are
inefficient
business
or
lazy,
hat.
a
dishonest,
there will
depressions; the
same
when
As,
be
as
we
however,
treatments and new
drugs are
reducing the death rate, so these
new sales
developments can pre¬
vent
unemployment from becom¬
ing too severe. In other words,
new
we
are
nomic
now
building
vent
an
we
up
an
eco¬
department"
"fire
This
to
pre¬
economic
never
no
R. W.
conflagration.
had before.
newspaper,
Pressprich, Jr.
To Be Partner
national
great weekly,
a
local
your
have
read
you
advertisements in
in
Tucker, Anthony Co,
you
idea of the work spent in
preparing those advertisements.
Markets Now Are Analyzed
Even
before writing these ad¬
vertisements, both the product and
the
appeal have been tried out
five
different
on
Perhaps
advertisements
submitted; then each of these five
Appointed by
would
Brown Bros. Harriman
Brown
Co.,
59
City,
maintain
tape recorders,
dioramas
"flop photos." In short, when
and
would be selected out of 40 copies
of
must
I
ago.
thousands of housewives.
others.
the
be
brightest factor, which I
mind, never existed 20
seen
some
of the brains,
planning,
and
the
energy
which are being spent on
copy,
color,
space,
type,
and
even
Municipal
Bond field, having been associated
with such well known firms as
H.
will
the
the
recently
films,
have
I
Company,.has
experience in
damage
ing, salesmen training, and es¬
pecially on conventions. During
my visit here in New York City,
Jenkins, In¬
most
the
the sales
forces not only hear
speeches; but
these speeches are illustrated
by
loans
in
being spent
now
vestment Securities Dealer, at 509
Madison Avenue, New York
Mr.
of
no
Demonstrations
health.
most
be
conventions
our
years
editor
publisher.
has
have
these
abuse
The
Thomas D. Jenkins
ac¬
must
for
reasons
Visual
At
sicknesses
have
with
P. A. Benneche Wilh
employment,
full
as
come
from selfish labor
leaders,
heavy imports, and reckless price
cutting.
Bon-
bright & Co., Inc.; Clark, Dodge &
Co., and the Mechanics Savings
Hartford, Connecticut. He
business
budget
will
are
The
made
are
could
unemployment shouJci
there
Bank of
also
number
controls.
His
included
firm
corporations
this
if
outstanding, but rather big sur¬
pluses. (5) Farmers are insured
by price supports, and climate
a
long
investment,
economic
former
I
balancing the
judgment, in these
enormous
balanced.
what
several
strong ^position, and most
had
the
earlier
about
my
times
with
there
se¬
large
Moreover, plans
that
g
optimism: (1) Real es¬
mortgages will be protected
by the Federal Housing Agencies.
Tampa, Florida, office,
experience
conclusion, however, I want
couple what I have just said
tax
n
mild
my
Tampa Street.
Mr.
Rosier
In
about
i
r
tate
Stock
leading
system and put it into
shape for the long haul of heavy
to
r
1932.
are
I
seriously return.
a
Protection for All Worthy Cases
tax
costs
in
na¬
held'.
were
today that over 585 are al¬
ready planned for the next eight
that
return of conditions such
no
only
annual
learn
doubled
—
be
these
ago,
,(2) Stock prices will be bolstered
curity and commodity Exchanges, by 75% margins. (3) Big business
failures will be prevented
announce
by the
that W. Gayer
Dom¬
inick is now associated with the RFC. (4) The banks are in a very
Exchange
time
of tax
are
*
City.
this
at
conventions
organi¬
World War III
Roger W. Babson
TAMPA, Fla.—Goodbody & Co.,
tax
badly needed: for
are
shorter,
terms.
year,
speak
tional
years
—b
17
Goodbody in Tampa
a
whole excise tax structure.
I
for
items, notably liquor, are
high that the high tax
produces
used
'Company
elsewhere. Pre¬
depression
the
of
believe
I
There
and assistant
on
10.
W. G, Dominick With
not
now
Oc.
on
existed
had
is not
taxed
securities
King, who has been with the
general, but selective.
Sales of many kinds of goods are
tem
Brothers
Wall
announce
Gerard
Harriman
Street,
the
Rosier
Comptroller.
New
&
York
appointment
Assistant
as
Mr. Rosier has been
with Brown Brothers Harriman &
Co.
since
which he
American
January,
was
1951, prior to
associated with
Sugar
Refining
the
be
these
five
on
The
thou¬
reaction
of
the best
are
artists, photographers,
writers and psychologists. In
of a depression, this adver¬
copy
case
tising will be
in
factor
fidence
is
out
housewives determines who
even
giving
increased
con¬
nation
unem¬
ployment.
addition
In
ing,
R. W.
to
and
millions
this
newspaper,
similiar
advertis¬
being spent
are
Pressprich, Jr.
a
Pressprich, Jr. on
a
partner in.
Tucker, Anthony & Co., 120
Broadway, New York City, mem¬
Reginald
W.
on
Nov.
1
will
bers
buy when the
threatened with
again
as
consumers
to
magazine,
must be
tried
families.
sand
Com¬
pany.
further reduced.
of
the
become
New
York
Stock Ex¬
change and other exchanges.
Pressprich
ner
Mr.
formerly a part¬
Pressprich & Co.
was
in R. W.
radio and television. Modern tele¬
It is a Spartan
policy. It will
require strong administrative and
legislative
leadership and great
integrity. But it
To
return
can
to
my
W. Lewis Harl
of
20
Visit to New York
be done.
place
vision
on
be¬
W.
Lewis Hart, partner in Aus¬
ginning, the policy of a balanced tin, Hart & Parvin, San
Antonio,
budget, of reduced spending to is in New York
City on a business
permit
way
reduced
insure
to
foster
a
peaceful
in
the
years, started his career with J. J.
B. Hilliard & Son in 1927.
tax¬
payer's earnings than it may keep
for itself and its shareholders. We
distinguishing excessive profits by reduced, expenditures
from,
It
master¬
a
complexity
business
in
or
last
150
so
members of
tax increase
the
about
20
destination of emergency
The latest corporate income
York,
ceding
months.
too
taxes.
have great conventions here
cerns
in New
doing today,
sliding
law,
through individual plant training.
once a year the
leading con¬
compared with
years
some¬
changed. Eighty percent of the
being employed today
taken
college courses on
Business
Administration. Before
being allowed to sell, they are put
brated
25
sell
salesmen
see¬
zations
the
try 'to
commission. Now this is
have
Bond
Company, Ken¬
tucky Home Life Company, cele¬
would
all
permanent
New
a
into
(3)
of
Bankers
taxes
prevent the increase from
common
Secretary
a
what
sales
this situation. Never¬
cure
tivity
"yes."
profits tax has
but its deeds are
excess
Assistant
Bankers
the
be
if
(April 1,
these tax
over
fiscal
would
billion
were
year,
produce
the
revenue
$2.7
full
a
increases
various
on
-increases in excise taxes
King,
Mr.
To repeal the last 10% increase
the
income tax will,
in no
King
LOUISVILLE, Ky.—Charles C.
creasing tax impact.
in
C.
to
ing
have not kept up with the decline
in value of the dollar and the in¬
broadly
high, and must be reduced, unless
based excise tax system to
produce
the goal is Socialism in our time.
a
greater share of total revenue
Second, the taxes are not well
than the excises now provide. The
devised.
Too
many
fall in the
lapsing of the increases should
wrong places.
be coupled with a revision of the
tightened, Congress put expiration
or
repeal dates on the
excess
profits tax (June 30, 1.953); the
Charles
is
he
as
visit
York and
always
on
all
of .Then
however,
year,
maintain
school
thought. After
impossible
per
with
agree
this
must
$1,005,381
to
well
as
take
Finally,
to
of
economic
the dollar be made
can
long
so
old
over
the budget be
can
how
of
advanced
height
on
billion.
$100,000
and
statistics, I am
inclined to
$5,000
couple
must
have
$11,641 today; the $8,000 couple
$19,760; the $15,000 couple, $44,The
studying
charts
The
384.
two.
or
Wellesley,
today
must
Optimism
By ROGER W. BABSON
rno
plus
90 cents out of
every additional
dollar over
$100,000 which he may
hand
others,
to
of action is clear. We must
i course
~
all
power
$70,000;
over
pruning of the mass
of
legislation
already
on
the
books, which authorizes appro¬
priations.
Session
after
session,
t
above
our
$100,000 surtax net
reducing
careful
a
net
must
year.
Third, there
and
an
in
line.
surtax
Very high taxes have
Federal
analyzing and
budget. They
last
$4,000
the
scale,
with
man
income
in
appropriations. The appropriations
committees performed a herculean
task
with
devastating I. ment
a
down
income pays nearly
$1,000 ($936)
in Federal income taxes
alone. At
the other end of the income
analyzing
spending proposals and of fittingparticular recommendations into
the
had
and
up
man
the
adequate technical staff,
like that maintained
by the Joint
have
all
21
want
taxes
a
strong
world.
those
is
stable
nation
As
results
the
and
citizens,
from
best
dollar
to
a
we
govern¬
trip.
of
Mr. Lewis is also
the Union
Government
Life
State
San Antonio.
Bank
Personnel
Insurance
a
director
and
advertising
did
not
exist
Not only is this a
great
factor
today
in
creating
consumer
buying, but plans are
years
ago.
being laid for television
in
most
a
case
into
wonderful
business
a
should
Company, both of
PHILADELPHIA,
to serve
capacity
suddenly
in
go
with
of
r-
Conventions for Salesmen
Twenty
years
Pa.—Stanley
W. Jeffries has become associated
Charles
A.
&
Taggart
Co.,
Inc., 1500 Walnut Street, members
tailspin.
the
Mutual
Stanley Jeffries With
Chas. A. Taggart
ago
couldn't get a job at
anyone
the
Philadelphia-Baltimore
Mr. Jeffries waii
formerly
with
Merrill
Lynch,
Stock
who
anything else
Exchange.
Pierce, Fenner & Beane.
-
22
The Commercial and Financial Chronicle
(1538)
monetary policy. But the accept¬
of inflationary expansion, not
luiopean and American Inflation
Commenting
by deliberate
weakens the
moral justification
of criticising
other
nations for
adopting the
identical policy in much more dif¬
ficult circumstances.
Britain and
by necessity
but
choice,
somewhat
"Chronicle" article by Drl Palyi, Dr. Einzig
on
European nations are largely responsible for their own
balance of payments difficulties, and their internal inflation
agrees
cost of
LONDON
Eng.—In
"Commercial
the
Financial
would
have
t
sued
unsound
sued
* +
a
United
through
of
balance
a
payments crisis the Western Euro-
States
r.nnntripc
pur-
P£an to
tion
policy of monetary expana virtually uninter-
a
afford to
their
without endangering
solvency
the same.
Tt
wprp
not in
,
+u
do so.
SPSJS.'aStlS.'R
monetary policy.
Our been
Dalton, Socialist Chancellor in dable
thhtt-thst th. propl, o, winners in
States will be the big th, U.lftd
post-war
beyond
f
Ovl>x
v
1 CiO
J
jtr
•
/»
the„long
j
'running
intJr"
their inter-
the taxpayers.
<
Let me give you an idea of some
;• of the things that businessmen are
^talking about and wishing would
•'happen in our national govern-
^ hirn^is^argelv^h^ 1 n&ical
l
H inpvltahlp
natural and inevitable conse-
both in Britain^and the United would have created a
States> only they assumed differ- disequilibrium to the
tinn
n
t
a
n
rn
nnnsp
n
n
ov^-Tulfemployment*the^rduly
Welfare
weiiare
State and the maintenance of madoption
aaopuon
speedy
speeay
t
rates
at
been
have
torates
torates
these
endorsed
policies
by the elechas
country
every
—
-
the
and
States.
United
the
d
depression
Tr*;' , h'
the
the. cost
at
',.li 1 iiv
of
have had to check inflation. It is
their
„f
the
because
Govern-
Eurooean
fach
policies
it
his
on
the
since
been
the
Is he in
ness?
that the
a
the
of
end
models
of
war
sound-
position to deny
truly remarkable progress
of the American standard of
has
achieved
been
to
living
large ex-
a
eaung.
eating.
us
its
taken
States
races
Prices
m
in
during
the
and
tinued
the
of the
outbreak
flict
the
United
Korean
States
had
to
con-
full
for
at the
hasty
same
years
conflict
rearma-
time it is
real sacrifices and the Ameristandard
and
up
United
the
often pointed out that the extra
effort involved has not entailed
can
war
in
the last two
need
ment. Yet
retort that "the pot calls
the end of the
place
is often put on the Korean
he exposes himself to the obvious
From
during
years
could have set
was
need
no
of
rise
to
in
living has conspite of Korea
rearmament.
this is
doubt
Beyond
of
other
European
countries
to
could only be achieved at the cost ports to the United States are
of further inflation. It would have strongly resisted by the American
order
With
to
their
making
avoid
Communism,
immense
gold
and external
assets, with
favorable balance
ently
ments,
trial
with
their
and,
ion
in
a
pay-
indus-
all,
raw
avoid
of
the
the
between
former
latter.
in
boom
Order
Possibly
a
rigid
with
have
certain
pro-
of risk of slump, and there can be
organization,
no
entailed
a
*»
tr-jj
^
rk-ldcler U.O. Adds
BRIDGEPORT,
Conn.
—
Mrs.
might Anne L. Blaser has been added to
amount
the staff of A.
940
M. Kidder
&
Co.,
incalculable
economic,
consequences.
This consideration has to be borne
n
T
,
Conn.—Joseph J.
.
,
,
.
,
,,
Palker> Jr- has been added to the
t0 tly t0 run their in mind by anyone who ispost-war staff of Robert C. Buell and
inclined
to
criticise
American
Company, 36 Pearl Street.
whose
sav-
t^in" American
a e mvested1 m American
buuslness and to those who buy
the products of business.
It has been said repeatedly that
repeai
QJ£ of°the
best
hedges"againVin-
ices substantially
cQuld reduce
earnest.
taxes
for^manufacturing' corpora-
t;on~
WPrP
ord and I can find no promises
made by either candidate to busi-
year they were 6
I have further searched the rec-
T
Federal
instance
f
1Q4q
sales
0f
q
Last
9% of sates In'
the growth companies the spread
My own com-
greater.
wag
instance, showed a difference 0f 5%^
There's one of the reasons why
prjces cannot come down faster or
parly} f0r
much.
Now jugt supp0se prices could
suddeniy be lowered by the difference between 1949 and 1952
taxeg> Say between 3V2% and 4%.
very
According to my calculations that
w0ldd increase the purchasing
tw it
Power of the dollar or of the labor
* thlt twl
f hour by close to 4%.
<
hn'qine^ and nolitirs
Aside from improving the pur-
^
wac
whJn
ti
consorted
ODenlv
takPn
from
wav
it makes
1
us
boil to
interests
economic
also Realize chasin£ Power oi the dollar, how
3ndanother nJany.f10r1e PeoPle 9ould y0,u
liberties
was
pl°y 'f S?lea W?£e mcreased 4%^
-Nevertheless
Not only do the consumers and
how other J
wor^er? get. h"1.1 by hlgh
I
?j?atmyb^
^at0a^USASm^[cPan^^
see
have^nvested^ThSr
abused
have
political freedom-and
getting away with it.
.
'
•
their
are
Business Well Fumigated
fnlp^b°hl,fi„®£
Dusiness. ♦
There are still a great many
people who think that corpora-
-
'
tions
Politically
owned
are
by
the
rich.
A
the survey this sPring by the New
other hand, have been pretty well York Stock Exchange showed that
fumigated politically and still ap- nearly 7 million Americans own
parently they aren't good enough °ne °^TjPore shares in corporaBusiness
and
industry,
on
to be seen with, out in the open.
have
voice
and
culture
the
Labor
Administration
•
a
and
Rons. When you stop to think that
2^lo m(1Pe°P t
vTVsin toTe thaTthrifMs h.
bH'
also has a
_i
vcjcal since theneed vested 0f miHi0ns of our lowerchords last tbldft in American business the
streng henmg. Not
income families.
they
use it. Commerce
voice »--»• its
but
'
Republican President was Secre-
^
.
onA
AAA
,
...
...
More than 200,000 families with
strong advocate of business in the incomes under $2,000 own shares,
Administration.
So, maybe it's
These people invest in industry
time for business and industry to for income and enhancement of
what they would like ^ 1
to have
I
don't
mean
gifts
from
.
principal and
attack that is
any
made on corporation earnings
an attack upon their savings.
is
Should those 7 million investors
become organized, the man—gimme-gimme-gimme. Business, agement of business and industry
Everybody else is asking Uncle
(Special to The Financial Chronicle)
HARTFORD,
those
to
and maj^e more money,
Santa Claus.
R. C. Bliell Adds
but
course,
comes
Business?
the greatest
of you, I am sorry. I wasn t
trying to be funny. I am in dead
—and
slump through excessive antiinflationary measures would have
prof¬
excess
an
any
say
~
Street.
Broad
doubt that the development of
entailed
If that SOUnded funny to
men
tary of Commerce .xv.. v, we had «
^
have .. v.
a
(Special to The Financial Chronicle)
a
? set f(?r less for- social and political
tunately placed countries to show
*
tO
policy
position to avoid infla-
financed °Ug
side
medium
anti-inflationary
altogether. An example could
1
happy
a
the United States would have been
well
be
haviour Prescribed by Dr. Palyi,
we had really tightened our belts
and lowered our standard of
Bving.
and slump, it is wise to err on the
unequalled efficiency in
auction methods and
to
it
impossible to strike
reserve
of
wealth of
above
seems
It
persist-
a
formidable
a
capacity and
materials
costly orthodox financial principles.
classes may be arguable that, since
to the working
concessions
pertly to the rigid maintenance of
of
,
nfA
remarkable feat. But it maintain and increase their ex-
a
•
Nation.is a higher tax assessment.
instance where either -TTf Maybe thA pnnnnmi5t can prove
candidate
nrnvp
the economist
S°Ug 1 3 P CG 011J G PlaKtform of his contention but all I know is
3ny maJor convention of business- that if taxes were lower business
There is another aspect of the
subject. The efforts of Britain and
example to the
for
each
American prices has been weigh*nS heavily among the factors
makinS for inflation outside the
United States. But for this factor
the extent to which welfare states
and other policies have produced a
rise in Prices in Western Europe
might have been considerably
smaller.
they
damage reconstruction. There
war
in
an
which
in
ness and industry—no recognition
that they have problems, many ot
which have their origin m Federal
regulations and the manner in
which they are being administered.
Isn t this rajmer strange wnen
y°u st°P t0 think that corporations will pay some J|>/2 omion 01
taxes this year to the federal
^0^^^ T*
lurnish 34/o^of tne total federal
been possible to rearm without interests concerned and their chief
inflation, but it would have meant ;argument is that these goods
rest of the world for correct and
a temporary acceptance of a should be kept out because they
sound
economic
and
financial standard of living which, though are^ the products of sweated labor.
policies aiming at internal mone- still well above pre-war and in- This battle cry carries much contary stability.
Practically every- comparably
above the present viction in the United States in
thing favored and facilitated the standard of living in any other spite of Dr. Paiyi's contention that
pursuance of
a
policy of stable country,
might; have compared British and European workers, so
money and the balancing of the somewhat
unfavorably with the far from being sweated, are
budget without having to raise ex- pre-Korean American standard of feather-bedded. , It
is easy to
cessive taxation to that end. There living.
.
imagine how much stronger this
was
no
need to
inflate for the
It is far from me to criticise citation would be if, in an effort
sake of any large-scale and urgent this
preference of non-stop prosBve up to the standard of befive
!.■
.
The blame for the inflation that
has
any
black."
X P-5„
of
harm
t
.
tent at the cost of inflation? If not
the kettle
Yes,
told where they stood
tions af£ecting the
of that nartirular grouo
w
■
the
its tax, who gets hurt?
Mitchell
ZSOF&S, the Stability °£ their ESSfLiTaiiedt°nPw .S ins£?nee ^'t^ggardly.
.
pr^ leveL
Paly^sb^p^fations^ThTt^t he I have searched the papers high
The proof of the pudding is in Palyi*
bahappy and low bu^ 1 Can* f
3
!
lines, claim that the finan-
States
have
G.
™dnbehr®t thevPromised
.
overburden
an
Don
both
mprriKPr<s
"
"
increases
Congress
-normal and surtaxes and then adds
these
Qn the
Businessmen want a more
distribution of the tax
•'.-•When
candidates
oSSes
cial policies pursued by the United
of*
(1)
,
equitable
'..burden.
Atl
Sings
the United umtedbtates fiaL~wTth "imounitv
ine uxuieu
naa oeeninanappy
deserves-the peoples themselves States have of course risen considGovernmay rightly be condemned as haverably less than in France or Italy. and to ^ct^e unsound
ing caused their own difficulties. But there is relatively little to ments tor their unsound policies.
In order that the severe indict- choose between the rise in the
As a matter of fact, the argument should carrv adeauate moral United States and Britain or sev- ment is almost entirely academic,
force,
however,
it
must
come eral
other Western European The relative importance of the
from auarters which are entirelv countries. In incomparably more United States in world economy is
free of the fault for which they favorable conditions the United so immense that an inflationary
readily
condemn
the
European States have not been able to keep American policy would have pracGovernments and nations. Can Dr. down their cost of living much tically ruled out the possibility of
Palyi, and the other American more effectively than many West- maintaining stable prices in other
writers and politicians, who argue ern European countries.
countries. The rising trend of
the
and
Government
'
-;
, fh
gr0UpS
dollar
The
United States have pursued mone" w°uld hav,e be,conf s,o£t c.urrtC^y
tary Policies a™"ie-r'8h">' or ?,nc!
°rder to d e f e n d it the
wrongiy_at the avoidance of a United States Government would
artificially low
an
since
And
.
the
ine
of
or
Britain
formsBoth
ent
fundamental
detriment of
.^ment.
yalk
instance is that of farm produce nal conditions and the inflationary order
subsidies,./ They,' have
operated conditions in the United States..
be
won't
we
bill for Uncle Sam
a
*to pass back to
.
th^ir
run—and
up
>
cr
f^hiP pVn^Pnnl'npp Unf
table consequences of
,
interests, ui course, business ana
fresiaeni spoxe oeiore tne Amer
British sionary internal policies they have —
able to maintain a formi- , .
Dr.
export surplus? Simply be- m
S
their mean s.
1945-47, was severely condemned cause most other countries have "rmers at a
The indictment
on
both sides of ; the Atlantic for been inflating to an even higher ^p
is
severe
but
his inflationary cheap money degree.. Let us suppose for the sake ^
just. There can
policy, pursued through bolstering of argument that it,would have „udifincp
nd
Dr. Paul Einzig
be
no
doubt
+v,
up the prices of government bonds been practicable for Britain and at+;mesoneor
that the govat an artificially high level. That other leading countries to adopt
mes ne r
ernments concerned have largely
policy was discontinued in Britain strictly sound financial policies dMate brhke'
themselves to blame for their balin 194?
In the United States it sinGe the war.
The contrast, be- .
uis travel
anceof payments difficulties, which
continued rigbt till 1950. Another tween their sound domestic inter- itiner*
<n
and for having
lived
.
the Democratic candidates for think far beyond its own selfish
lhe question is wny
SDOke before the Amer- interests
Of rourse business and
KS'aSSSlES
end of the war
economy,
Last month the Republican and on the other hand, is trying to
oosi-
a
have the United States been in a
STSr
the
,
states could
United
inflate
sion leading to
poli¬
since
cies
the
Instead
having pur¬
financial
.I
.
x
the
progress
ignoring problems
are
business, while catering to other segments of the
would ployment. But he who is blameless
rapid, but
less
been
impressive all
countries
pean
The
countries.
other
Western Euro-
for
.
well behind that of
leaving
less,
other
Britain
and
of
Mr.
Mitchell lists among things businessmen are wishing would
happen in our national government: (1) a more equitable
distribution of the tax burden; (2) a non-isolationist foreign
trade policy;
(3) non-interference of government in labor
negotiations; (4) an end of profit regulation in competitive
business; (5) honesty in government; and (6) no more deficit
financing. Wants more cooperation and understanding between
big business and government. 1
Asserting Presidential candidates
pursuing inflation for the sake
of raising their standard of living
and avoiding the risk of unemfor
+
It is true, such a policy
Chronicle," Dr.
Melchior Palyi
indicts
By DON G. MITCHELL*
President, Sylvania Electric Products, Inc.
have involved a certain degree of 0f this offense should throw the
self-denial. But thestandard of liv- first stone.
ing in the United States could
pajyj COuld of course reply
have continued to rise neverthe- tQ lhe above argument that while
1
1
'
article ap1.3 issue of
and
From the Next
countries
adequate excuse
had admittedly no
inflation.
interest-
an
ing and provocative
pearing in the Sept.
Thursday, October 23, 1952
.
other Western European
policies of over-full employment. Holds, however,
at fault in following similar ideas, achieved largely at
is due to
U. S. is
.
What Business Wants
ance
By PAUL EINZIG
-.
Sam for something for themselves
ever
would
♦An
address
the
Rotary
111.,
Oct.
14,
by Mr. Mitchell before
Club of Chicago, Chicago,
1952.
not
have
to
plead its
case
__they, the Owners WOUld do it.
And
while
we
are
on
taxes
I
Volume 176
Number 5162
.
.
The Commercial and Financial Chronicle
.
(1539)
think you will find that business
a
monopoly, then I believe the have markets
business, but, public should be protected against production?
—not all segments of
business
generally
is
—
far
unfair
from
prices.
Regulation in that
being happy with the excise tax
connection makes sense to
rates.
the other
They
have
and
sales
all
range
in
instances
some
retardants
the lot
over
of
na¬
ture.
ment.
uniform
see
social
excise
it's
reasons
expected
that
taxes.
hardly
tobacco
and
have
everything bear
tax.
Moreover,
that
see
tax
that it
ner
did
plied to corporations
not
contribute
years
we
and
to
Tax
was
as
a
ap¬
stop being afraid of the
big corporations that are probably
could
revenue
be
higher prices through the process
of mark up.
In other words, we
tries
and
proudly
to
to
stand
its
upon
Such
to
our
are
When
the
government
example.
■'
It
v
■
matters: little how much
have
given other nations
much
have loaned them. Their
we
people have to eat and their
ple
we
how
or
can
what
they want and need but
have not been
markets
to
willing to
them
in
we
open our
such
a
way
that they could sell their products
in volume.
In other
words,
tariff walls that
When
I
go
have put
we
up
isolationist.
are
to
over
Europe
to
discuss the American market and
how to cultivate
not
am
What
wonderful way to stifle
a
enterprise—take
any
the in¬
away
centive.
Price
stabilization
and maybe the
away
tax will also
is
profits
disappear next
year.
In the
meantime, we should try to
convince the people and the Con¬
gress
that profit regulation for
us
with
hand and
us
with,
the
government
us
Public
•
free
bor,
if
cannot
compete
with
foreign-made goods, go into
some
you
other
business
compete.
I
where
do
you
that
say
can
we
tion
a
Crooked revenue official
permits a taxpayer to falsify his
return, the government loses rev¬
that
and
enue
made up
revenue
has
to
be
by the honest taxpayers.
are
high that peoples in other parts
so
taxes anymore than
anybody else
but they pay them and their books
of
the
build
world
tariff
our
hurt
are
and
to trade with nations that
friendly to
We
have
are
un¬
hurt
England
and
by
tariff
our
of
open
we
want
the
are
to
story
When
we
know
that
same
of the
profits
taxes
pay
the
policy with respect to Europe and
(6)
We
offset
not
an
want
an
international
policy.
that economic pain — only
opportunity to sell in our mar¬
kets
will
be
satisfactory.
negotiations without
government interference.
own
There
is too much at stake
to¬
day in terms of national defense
and
of
the
national
economy
to
paternalistic
have been giving
we
and
lending dollars to Europe—
billions and billions of dollars. But
what our friends in Europe
really
want is work and self-respect.
but
once
the
two
their
the rules
problems
outside
laid
are
down
together
assistance, and
without
with
full
-
understanding that the laws of the
land will apply with equal fairness
to both sides.
Most negotiations between labor
and
management
are
^smoothly but labor
one
else
worked
never
out
forgets
minute that when everything
fails there is Washington to
take its
side.
To give billions to Europe is not
and
economically
we can
our
al¬
lies that would be unbeatable. But
if we
continue to give billions
yearly to Europe in the hope that
Europe will once more save us
from
being
a
we're
broke, friendless
Let
a
bet
on
the
other team.
The
sooner
taken out of
will
be
for
labor
relations
is
politics, the better it
both
agement—and
labor
for
and
the
man¬
innocent
help
Europe, by all
but let us do it in a com-
monsense
(4)
Let there
be
an
end
to
the
regulation of profits in competitive
business.
In the
public
case
of
interest
manner—in
a
that
If we
way
a
richer
not
repressive
to
would
in order
can
If
that's
accomplish
be
silly.
It
silly because it would
invitation for others to come
as fast as one was
bought out,
they too could be bought out.
want
all
to
such
apply
white¬
transactions but
I
venture to say that if you trace
down a number of such deals
you
will
find
that
the
big
manufac¬
turers could have gained the same
by starting from scratch with
organization of their
an
might have cost
taken
have
more
and
time but also it might
cost the independent some¬
more
particularly if the market
Under
such
circumstances
the big fellow do
do
That
own.
money
limited.
were
to
wrong
right
And
the
after
buy
the
out
the
did
small
transaction
took
instances
were
many
prices raised
reduced?
that
and
think
I
pretty
how
many
will
you
find
generally1 the
tomer benefited
in
some
And, of course, with
our
inheri¬
small
fellow
tax
hard job anyway of retain¬
a
to
help
industrial
through
and
sharing our
marketing know-
Teams have
come
over
here
and teams of Americans have
gone
over
there.
We
think
this
has
helped
Europeans
to
understand
laws
the
ing for his heirs ownership of the
business.
He
111,000
123,000
254,000
2,110,000
Served.
almost
has
502,000
3,643,000
Formerly the company had a somewhat complex capital struc¬
ture and because of the financial difficulties of raising funds for
construction,
new
Bank
1951
a
substantial loan
and the company was
capital structure
was
made by the International
At the end or
was
recapitalized in 1950.
approximately
as
Preferred
Stock
(853,000
follows:
52%
$87,000,000
shares)
(1,777,000 shares)
$45,000,000
12,000,000
*30,000,000
100%
14
34
Total
-
Net
for contingencies but
reserve
operating
excluding $21
million intangibles.
varied considerably in the past
due in part to substantial dependence on hydro power.
Thus, in
revenues have
1949
only $1,275,000 was reported earned, while in 1950, $2,604,000
and in 1951 $3,246,000. In 1951 the company wast
by a more adequate supply of hydro power, although it
was also
necessary to operate steam plants practically at capacity
throughout the year. In February, 1951, the Federal Power Com¬
mission placed in service its Santa Barbara plant, the total genera¬
reported
was
favored
tion of which
The
wages
was
made available to the company.
company's
major
(the Mexican
peso
problems
have
been
with
rates
has been stabilized in recent
that there have been few if any
exchange problems).
and
years
so
Due to the
political strength of the unions, the company has had to grant
substantial wage increases without obtaining
compensating rate
increases, despite an earlier agreement with the Mexican Govern¬
ment which seemed to assure adequate rate adjustments.
Howver, the new President of Mexico takes office Dec. 1, and while no
substantial
change in policy is anticipated, the
able to obtain fairer treatment
now
company may
that the election campaign
George S. Messersmith, Chairman of the Board
over.
be
is
formerly
was
Assistant
Secretary of State and United States Ambassador to
Mexico, which experience should prove valuable in seeking a more
definite solution of the rate problem. Current earning power is;
estimated to be less than 4%
With
the
use
of
the
on
funds
the rate base.
obtained
in
connection
with
the
plan, the company will be able to complete its current con¬
struction program next year so far as generating facilities dte.
concerned, and further construction of production facilities will
probably be deferred until 1958-59 when substantial steam units
recap
be added.
may
benefit
of
Mexican
In 1955, however, the company should have the
hydro capacity to be constructed by the
additional
Government.
cus¬
way.
tance
sell
to
out.
The labor problem is described as follows in the 1951 report:
"The relations with the union are still far from satisfactory, due
so much to the attitude of the workers of the
company them¬
selves, who in the overwhelming part wish to see the company
prosper and function adequately, as they realize that this is in
their interest, but due to the arbitrary attitudes of the direction of
the union."
In other words the union leaders have apparently
not
assumed
But, and this is what galls me,
very
government
that has
the
agents lurking behind every bush
to
discern
country?
American business has been
try¬
Total
Population
did he
or
fellow?
place in how
—
,
to
be
to
268,000
-
Federal Hydro
♦Including
wanted
don't
224,000
30,000
"
mean
in
under
ing
I
an
I
$
.
$25,000,000
2,010,000,000
Funded Debt
be
wash
■
;; $11,000,000
1,113,000,000
hours)
Steam
creative of small
are
method
hydro
indicated by th
as
1951
Hydro
other manufactur¬
competition.
we
be
some of our
philosophy of produc¬
utilities, where the tivity and marketing. But what
is best served by good will that do them unless
they
the
(kilowatt
Output
devour
components
the little businesses it
would
Last year about 40% of the
derived from hydro plants and 44% from steam plants,
Capacity (kilowatts)— ;
busi¬
Many people get the idea that
big business is out gobbling up all
what
holding company
affiliations, whose
electricity used in Mexico.
was
Common and Surplus
reduce
a
1942
small business.
to
is
European
with small busi¬
parts,
and
Company
with
and
Revenues
subcontract work wherever
market in all the world than this
how.
public that always gets hurt.
big
Power
Canada
plants. The company has enjoyed rapid growth
following comparisons:
can.
us
and where is there
got
with
in
Light & Power Co., Ltd.
&
the remaining 16% being obtained from government-owned
we
has
means,
output
in their products.
use
business
battlefield,
bound to end up
and battle-torn.
will
hasn't
review
any
In other words
we, and
set up a
defense for ourselves and
help them and help us.
V
Business and industry are not
want Europe strong as a buffer
unwilling to submit deadlocks to
against the spread of communism,
a
third party for adjudication—
then we should help it to
develop
they just want to be sure that the trade
umpire
We
we
internationalism, it is pauperism
financially
parties should work out
develop
can
the other.
operating subsidiaries serve Mexico City and adjacent areas. The
system, with annual revenues of about $25 million, supplies about
:
thing,
permit labor relations to operate —pauperism to them and if kept
in an unorderly manner.
Some up much longer pauperism to us.
kind of regulation is necessary,
With America strong
<
in
units that
ers
end
For years
(3) Let industry and labor han¬
dle their
patronizing
a
and
so
practices, and no
and loans will
grants
dis¬
some
Light
incorporated
-
to which
not ogres out to
are
We
rules
for
terribly
We have hurt them
-amount
an
everybody and
that there shall be no
exceptions
or exemptions or
crookedness.
France, and Belgium, and Hol¬
land, and Denmark and Switzer¬
land.
are
they make.
us.
have
more
classed
big business,
departments.
When
fences
to
be
We
govern¬
Utility Securities
Mexican
Mexican
ness.
'
Businessmen do not like to pay
wrong
one
rather than
ness
attacks
our
panning
panhandling
By OWEN ELY
half the
deficit financing.
more
suppose
would
is contributing—and
one
When
competitive enterprise is but the all that we meet. On
the contrary,
first step toward socialism—and I
we help to build other
businesses.
don't think we are quite
ready Our suppliers, for
instance, num¬
for that in this
country—yet.
ber around 15 thousand.
as
trader who would say to American
manufacturers and American la¬
I
group
ment would stop
as
(10) An understanding of and
appreciation by government of big
business and a cease fire order.
yet
other
I wish to Heaven that
My company is small when com¬
melting pared to the giants of
industry,
excess
ing lot that is contributing to ifce
progress of this
country as z>&
Small business is healthiest when
many things that
industry would like
trarily chosen period. That wasn't I would like to
devote
price stabilization—that was profit cussion.
fixing.
abid¬
and deficit.
But there is
(5)
out-and-out
an
(9) No
arbi¬
some
Honesty in government,
I have done,
they
think
I
am
giving them especially the administration of
double
talk.
"How," they say, internal revenues.
"can we hope to take advantage
If there is one part of our
gov¬
of your ideas when you have such
ernment that should be without
high tariff walls?"
reproach it is the revenue collec¬
I
it,
profit made in
the
aon
are*#"law
too
are
business and
Price stabilization is also geared
peo¬
need certain things they do
produce. The only way they
import is to export. We have
not
!
we
big business is healthy.
us
to bring to the attention of candipart of business stead, profits were tied to an arbi¬ dates for the office of President
should make a profit as a tax col¬ trary period and when the figure for me to discuss in
the limited
was
exceeded
the
lector.
penalty was time we have here today, such as:
s
enormous—now 82%.
I say that
(2)
Non - Isolationist
Foreign
(7) Less waste and extravagance
is bad because it is
confiscatory— in the
Trade Policy.
administration of our na¬
it has only one objective and that
tional government; and
Little by little our policy with
objective isn't revenue, it's control
respect to imports is driving other of
(8) A clean-up of anti-Amerprofits which could lead even¬
nations to expand their trade with..
icans in government offices.
tually to nationalization.
to the
businessmen
big business it attacks all business.
do not believe any
Russia and other communist coun-.
tries;
England is one very good
attacks
all
country without addi-
tinal tax drain
There
whole I think
we
try and to create opportunity.
mercenaries.
as
according to size. We
camps
are
feel
proud of what
they have done to build this coun¬
more
with
our
It isn't possible, in my
opinion,
divide business into two ox-
them
a
policy would enable
a
run
once
more
abiding units of
big business, it at¬
profits.
'
entire commercial world and make
feet, fighting
own
shoulder
allies and not
ob¬
tained by increasing the base tax
and be simpler to administer. In¬
wants
to
the most law
international
policy
that
helps Europe to rebuild its indus¬
meas¬
profits.
It
was
beforehand that the same,
more
business
the profit of
tacks all
Let's
smart
shoulder
control
shown
man¬
a
to
ure
would like to
we
paid in such
two
cratic country.
The Excess Profits
liquor
uniform excise
a
past
seen
not good in a free and demo¬
are
be
be included but otherwise let
can
the
two instances of profit
regulation and the implications
For
to
American
Within
A large segment of American
business and industry would like
to
On
chopped down because it wields
too large an economic power.
Europe has always needed ex¬
ports.
They are fundamental to
hand, where there is free the
European
economy.
With
competition, I am opposed to any strong exports Europeans can
buy
regulation of profits by govern¬ more from us.
been
serious
a
me.
in which to sell the
23
some
fraught
move
with
that might
public
unforeseen
some
danger,
circum¬
stances, at the first sign of distress
rushes
to
business to
big
out with men,
bail
it
machines and pro¬
duction.
I
don't
object
to
ful
to
against practices harm¬
the public interest, but I
object to
laws
or
tions of laws that say
iness
gets
so
big,
interpreta¬
when
it
officials. The contract signed early this year gave the
additional non-union posts of confidence," and while
of this is not clear it indicates that a better balance ;
may be maintained in internal affairs.
*,
company "99
the rpeaning
of power
If the eompany gets a
fair deal from the Mexican Government, .
(assuming that working,
capital has not been impaired) to pay dividends on the preferred '
stock. Whether payments could also be made on the common will •.
in
the matter of rates,
a
bus¬
should
be
it should be able
naturally depend on the extent of any rate increases obtained, the
adequacy of hydro power, control over inflationary costs, etc.
regulating
business
do
management powers and refused to cooperate with the
company
The $1
been
3Vz.
preferred stock (which becomes cumulative Jan. 1) has. '
selling recently around 6V2 and the common stock around
Approximate price ranges during 1951-52 have been 83A-4
for the
was
preferred stock and 5
earned
year.
4
on
-
23A for the
common.
$191
a
share-
the preferred stock and 44 cents on the common last
24
The Commercial and Financial Chronicle
(1540)
collectivism—an
Over
their
Regulation Threatens
threat
the
master.
in
high wages and steady employment of two
in privately operated oil companies, Mr.
as
business
to two million
young
of
detract
system
oil
women
a
horizon
the
thousands of
failed to recognize that
menacing clouds on the
which
Someone
might well change
has
said
this
that
triumph—triumph
of
age
is
in
employers
all
who
the art and the science of govern¬
are
in
the
competition
ment.
with
each
From
and
sciences,
For,
the
world
over,
of
the
economies—whether
you
scale nomic freedom and appropriate it
wages and for the state.
highest
of
fringe
The
bene¬
fits.
greatest
threat
industry and to
to
the
oil
in the oil
careers
To cite one industry, present and future, lies
example; According to the Bureau in the consistent and persistent
of Labor
Statistics,
average week¬
trend toward more and
more
of
lustre
dedi¬
with
came
Madison
the
for
cases
so-called
violations.
trust
paid
employees
And
here's
the
year
much
the
highest
industry. industry
thing:
Last stroying
business
steadier
provided
employment, than
American
separation
toward
the recent decision of the Depart¬
ment of Justice
to undertake a
the
merits, which
in
blow
be
may
has
been
a
seri¬
a
struck
at
our
gov¬
industry.
that is, the
rate,
ent
definitely
are
careers
future, to
industry itself
which it
de¬
in oil—both pres¬
and
the
nothing of
say
the country
or
Association,
smaller
companies
in
dustry,
when
said
50th
most
Federal
the
he
the
The
of
National
tem.
Oil
Industry In¬
formation Committee was
quick to
appreciate the importance of keep¬
ing
career
opportunities
industry attractive
and
in
on
demand basis if the
industry is to
continue to perform its
many ob¬
ligations to its employees, its se¬
curity holders, its customers and
its country. The Committee
estab¬
lished
a
in
program
high
schools
tion
designed
hundreds
throughout
to
the
interest
people in the petroleum
of
na¬
young
industry
and its
career possibilities.
At the
time the New York District
OIIC has been
same
conducting its
youth
for
program
poses in close
State
own
similar
pur¬
cooperation with the
Board
of
Education.
The
joint efforts of New York oilmen
and educators
have led to the
es¬
tablishment of a state-wide edu¬
cational foundation
looking toward
in
courses
subjects
of
a
on
these
variety of petroleum
the college level. All
activities
have
and will continue to
vide the
of
young,
ployees with
upon
whom
new
the
tomorrow must
aggressive
depend
our
about the wealth of
to
main¬
Today
scarcely
of
recent
example
of
intrusion
Government
in
oil
know
be
can
by
to
production, wages, prices
or sales
official approval from
someone
in Washington.
And
when the government
controls
those features it controls the ca¬
without
pacity of an industry to produce,
improve its position, make profits,
or
even
going
on
seems
to
exist.
for
a
This
one
has
been
time.
long
to have been
Life
succession
of wars,
lice
preparation for wars, po¬
actions, and other emergen¬
cies
requiring extraordinary
ernment
over
gov¬
controls
for a period of
And the end is not
20 years.
in sight.
One wonders, sometimes,
emergencies
are
being
created for the purpose of
whether
One
could
the
accept
tion that these controls
sary
the
or
any
advisable
assurance
control
boards
are
neces¬
one
if
could
that
those
intend
to
at
re¬
powers at the ear¬
liest possible moment. But there is
no evidence that
they do
us
of
Spencer
City, Oct. 14, 1952.
of
anomaly:
oppor¬
the
Meeting,
at
that
rises
an
If the Cold War
to maintain
our
government
ironic
causes
present system
indefi¬
controls
nitely, the Russians will have
a
the
tremendous victory.
have saddled upon
us
won
They will
a
business.
How¬
of the smaller companies
industry
ernment
been
that the oil
system of
to
we
of
the
that
careers
see
in
time.
same
the
oil
try
make that climate
some,
job
has
senting hard facts in
ing fashion.
*"
And
still,
company
gives
does
us cause
or
not
of
group
a
help
but
us,
for fear that
simi¬
a
lar attack may be made upon us.
"These
with
companies
having
own
charged
are
out with
gone
their
to find oil in previ¬
ously unproductive areas of the
world, of developing this produc¬
money
tion and
of
place
in
trade.
this
It
the
is
petroleum
difficult
to
accomplishment
with small business.
small
preeminent
a
company
world
see
how
interfered
Certainly
has the
tributions,
danger
no
fields in the Middle
"However, small companies have
to
now
been
able
to
export
lubricating oils with considerable
success
oil
and
cartels.
without
As
I
fear
know
of
from
any
my
own
experience, the greatest dif¬
ficulties of lubricating oil export¬
in the postwar years have been
due to the dollar shortage of Euro¬
ers
pean
nations.
But
tion has become
because
have
now
more
the situa¬
aggravated
lubricating oil refineries
built in Europe with
furnished by our United
been
money
States Government.
that
tional,
There is
re¬
defi¬
a
present
ef¬
primarily educa¬
not be
may
work
of
our
are
enough if
we
to attain the basic charter ob¬
are
jective
of OIIC, and that goal is
help reaffirm the faith of the
"to
American
people that their indi¬
vidual
interests,
of the
nation, in
best
are
well
as
peace
served
served
by
those
as
in
or
war,
competitive,
It is that gov¬
by a free and privately
industry.*" Not enough peo¬
owned
ple
are
that their economic
aware
freedoms
are
Charles
E.
being whittled
Wilson,
away.
former
Di¬
rector of Defense
Mobilization, put
the danger most,
emphatically and
most
authoritatively when he
in
warned
of
progress
recent speech, "The
a
our
Socialization,
economy towards
Nationalization (or
whatever other name for
big gov¬
ernment and little
people happens
to
meet your
begun to
it and
seen
As
fancy) is accelerat¬
while
even
the
popular
cry
against it. I've
go up
I know it."
friends
the
purpose of
of
which
disseminating informa¬
an
will
educational
be
h
1 p
e
f
not
was
set
to
nature
1
to
a
u
American oil industry as
and much
of
and
corporation
such disabilities.
no
do all of these
suf¬
They
can
more
too,
thngs and
effectively if they
more
can
be alerted and organized to do
the
job.
As you may
is
for
spring
lieve
all
into
faith in
these
action
if
they
interests
the
of
is
the
people
to
have
in oil—if they be¬
that their
best
This
year.
of
careers
interests
are
have suspected this
election
an
year
and
American
the
people
served
by competitive,
privately-managed oil businesses.
Business Men
Interest
Let
Should
in
Take
Politics
conclude with
this plea,
that each of you in this
audience,
me
whether
not you are an oil man,
or
active
and
special, informed
a
interest
in
this
year's
elections. And I urge you to urge
all your friends to do likewise.
Many
public-spirited
and
organizations
forth
a
make
citizens
putting
are
special effort this
to
year
that
sure
every
qualified
registers and votes. This is
voter
program of vital
a
importance, but
quite enough. I urge you and
friends with all my heart to
go one step further, and that is to
not
your
make
thorough study of the is¬
a
and of all national, state, city
sues
and local candidates in
you
order that
be properly prepared to
may
make wise decisions.
this
study,
I
urge
Having made
and
you
your
friends to vote only for candidates
—be
they Republicans, Democrats
of
you
some
other
party—whom
believe best equipped to serve
our
nation in the
or
To
First:
following
restore
the
ways:
old
good
Jeffersonian concept that a public
office
is
public trust;
a
Second:
out
To
keep
business
of
government
whenever
and
whereever
possible and to relin¬
government controls over
quish
business
at
earliest
the
with
consisten
date
possible
national
our
,
perly
the
engage
in
to
that
than
Many other matters
— inflation,
taxation, foreign policy
on—merit your considera¬
excessive
so
if
But
all
we
keep
the three main
on
oil
industry (third
largest in the nation by the way)
is owned by thousands and thou¬
sand
finding prompt and
of
of
our
corporations,
large,
me¬
tions
dium and small.
The
office,
a
convenient and effec¬
tive
means
for many millions of
people to invest their funds and to
engage in the oil business
the corporate form is not
venient
or
itself
effective
against
means
the
—
a
but
con¬
to pro¬
have
in
our
and
may
I
am
not
eventually expropriate its
speaking
many
—
it suffers too
legal and other disabilities.
The corporation is not
a
person;
it can't vote. The
tion
also
is
barred by
human
corpora¬
law
from
making contributions to political
campaigns.
(The possible abuses
problems.
you andT
duty to perform
a
is
year
side¬
no
of decision
year
well be
Next
of
solu¬
a
of
year
be
may
too
late.
vote
proper¬
capable
There
very
destiny.
we
to public
proper
citizens,
clear-cut
a
men
are
other
November.
those
who
would
throttle it
with government controls and
ties for the state
who
stepping it. It is
onslaughts
of
to
right
As American
corporate form has proved
itself to be
men
eyes
confident that
am
will elect the
our
targets I have
mentioned, I
80%
alien
any
American free
our
enterprise system.
and
more
upon
attempt
every
graft the principles of
tion.
estimated
resist
To
ideology
pro¬
so.
is
Third:
whole.
political campaigns and quite
tect
millions
employees
we
tion
It
but
these
of
welfare;
have seen, OIIC has been
established and organized for the
It
making political
resolve to take
amount
forts, which
resources
necessary to undertake the devel¬
up
vast
a
nite
winning and keeping
for the United State
interest¬
an
are
mains to be done.
has
one
people
listening in
greater and greater numbers. But
by this act of government, because
we recognize that an
unjust attack
companies
They are doing no
pleading. They are pre¬
con¬
pro¬
of other ways.
special
in
In
the place to go into that.
nor
the schools"' and in any number
to
sides
issues.
con¬
by
service
corporations
take
political
stockholders,
to
this splendid organization in. dem¬
and
for
to
or
articulate, unable to vote and
ter¬
a
performed
part
opinion, this rule needs
fer
Certainly
been
tradition, it has not
fashion
hibited from
healthy, whole¬
lot about it.
a
its
cus¬
Private corporations may be in¬
the free side?
on
the
time
And
do
we
very
of
overhauling and revising
the light of conditions as they
in
attractiveness
can
its
interests
exist today, but this is neither the
depends in large
What
privilege of
when
the
at stake.)
are
take
my
on
works.
and
siderable
the political and eco¬
nomic climate in which the indus¬
measure
the
itself
controversial
being
was
at
so
ing
on
denied
And last, by
subjected
to about 20 separate investigations
by various branches of the gov¬
cheered
not
are
East.
proposi¬
linquish their
Out
of
small
riveting opment of oil
controls upon business.
more
have
of
ever, we
that
made
respect
with
man
benefit
exception.
you
move
business
a
jubilation
career
all
a
no
tomers
in
of those
Not
enough
people
understand
clearly that their interests are best
busi¬
controls
careers
you are one
their
at
shrewd propaganda technique that
this attack is being made for the
.
Luncheon
York
of
government
discourage
encourage
privately-managed oil businesses."
place
We shall be
ness.
industry, how-
n;i*Ap addressWeek Mr.
by
Progress
New
em¬
industry
tain its brilliant
past.
In the midst of
Oil
pro¬
growing
a
ideas—the folks
oil
tunities in the oil
helped,
help, to
industry with
source
where
the
high
a
That has happened in Great
and
every
other
Britain
than
in¬
oil
anniversary:
"The
serves.
Control Threatens Free
Enterprise
comprising
industry has occurred in
workers out of every
As I said last
hundred who quit or were dis¬
May before the the last month when, with great
charged for any reason whatso¬ API Marketing Division in Boston: fanfare, some of the larger oil
of being
ever, was 4.4% for all manufac¬ When we have had enough gov¬ companies are accused
turing concerns. For petroleum ernment in business for enough members of an international con¬
dominate
world
oil
refining it was at the truly amaz¬ time, we shall have lost the thing spiracy to
ing low rate of only eight-tenths that really made us great —our trade.
of one percent.
free, competitive enterprise sys¬
"That is apparently part of a
number
which
industry
nationalized
a
is
defending
by word of mouth,
long time
through advertising, over the air,
coming, to conclude that
ous
ration
stockholders, employees and
onstrating to the American people
that
the
petroleum
business
is
special grand jury investigation of
working foratheir best interests.'
seven international oil companies
During Oil Progress Week; during
(five of them American) on the
get-togethers such as this; during
charge that they are involved in
the entire year, in fact, oil men
a giant
cartel of some kind. One
are telling their
story of progress
need not await a decision on
eum
we
any
another
oil
average
The
in
make
we
the
among
other actions in
many
believe
rific
question is raised in
same
oil industry, not only to the five
ly earnings for petroleum refinery ernment control and regulation of
American companies directly in¬
last
year
amounted
to the industry.
This may add to
volved but to all other companies
$84.70, a 142% increase above the career opportunities for politicians
$34.97 average paid in 1939. These and bureaucrats but it will not large or small who have any hopesi
or ambitions of
developing foreign
refinery wages are even more add to career opportunities in oil
oil production and reserves or en¬
striking when you consider that as we have known them.
One
gaging in any other phase of the
the average weekly
earnings for can't get very excited about the
oil business in foreign lands.
all
The
manufacturing industries dur¬ career of an undertaker or a pall
risks of developing oil properties
ing 1951 was $64.88, or almost $20 bearer following the corpse of a
and
a week less than was
doing
business
in
foreign
paid by the great industry down the road to a
lands are a 1 ready tremendous
oil refiners.
socialistic graveyard. After count¬
without having our own govern¬
Now I am not implying that all less experiments it still remains
ment
apply the bellows to the
petroleum employees are paid at to be proved that governments can
flames.
the
same
really create wealth or that they
scale
as
the
highlyThe dilemma was aptly put a
skilled refinery employees but I can find and produce oil.
No, I
few days ago by Earle M. Craig,
think it is clear that
do say that, on the
every step
average, oil
President of the National Petrol¬
are
oil
ing
The "Cartel" Controversy
The
are times when it
almost tragic that a corpo¬
seems
P'or one thing, our Oil Informa¬
anti¬ tion
Industry Committee since its
organization in 1947 has been do¬
alleged
workers
workers
rather
who
a
tion, these call it Communism, Fascism, Sojobs pay just ialism, or statism, the purpose is
about the always the same—to detroy eco¬
P. C. Spencer
this
of
except
struggle is going on by
those who believe in bigger and
bigger government to seize control
the standpoint
of remunera¬
are
oil, at least if
the
tion, but there
existence
consume,
policy which urges industry co¬
operation with the right hand to
expand the industry at home and
abroad for security and other pur¬
poses and then beats the industry
over the head with the left hand,
does not add to the prestige of
careers
in oil.
A classic example
titantic
other.
arts
which
In Oil
a
may
cartel,
for real alarm."
cause
There
one's life to the oil busi¬
Certainly
a
government
cating
situation.
the
ospective
p r
we
are
It
arms.
from
ness.
would be less than real¬
we
there
choice
4,000 different kinds
of
jobs with
than
more
ever,
and offers istic if
persons
and
men
employs close
its
oil
or
industry
There are other ways besides
and its future is peculiarly a child
extending controls and regulations of free
enterprise. I believe not so
in which government policies can
long ago someone found that the
"leading to a socialistic graveyard." Says our pres¬
of controls, by fostering collectivism, plays into
hands of Russia, and he urges keeping government out of
business by relinquishing its controls.
The
so-called
any
gives
which might result from any other
policy make this a wise prohibi¬
com¬
other companies
Government Discouraging Careers
you."
Spencer assails excessive government regulation of competitive
ent
a
fearful
Don't throw yourself government
and
servant
gerous
In commenting on
industry
action, rather than
"Government is like fire, a dan¬
President, Sinclair Oil Corporation
workers
call
We
strategy.
pher foresaw when he said:
By P. C. SPENCER*
million
would
I
ernment
petition from
no
will be in
fix the ancient Greek philoso¬
master
Private Oil Industry
That
it.
to
akin to
great
ideology
therefore
and
own
Thursday, October 23, 1952
:;.
for
asking
candidates.
or
as
Democrat.
only
think
fact,
as
I
an
the
long
you
a
Certainly I
Republican
am
trying
American
time
has
overdue
American to speak
I
you
to work
or
particular candidate
any
not
am
or
to
as
because
come—is,
—
for
a
speak
I
in
every
out.
fully appreciate that most of
already are giving time and
'
•
'
••
/Volume 176
Number 5162
<\
,
The Commercial and Financial Chronicle
...
(1541)
.attention to political
to the problems of
providing good
government for your
communities,
your states and your nation. That
.is fine, but won't you please make
extra effort this
year?
If we are interested
.an
oil, then
-
interested
are
government.
matter of choice is
our
and
almost
traders
in
more
improved feeling among
Treasury obligations. This has
buoyancy, which has resulted in
showing an improvement especially in the
mediate and long-term sectors which
have been under the
est
The
;
somewhat
a
quotations
inter¬
liquidity in
government
purchases
money
in
it
is
quite
reported,
few
a
of
have
been making new
higher income eligible
the
issues:
There have also been instances in which
some
of the
shorts have been let out in favor
of the longer-term
obligations.
These are cautious
operations since they do not yet involve too
much volume. The
prime bank rate, while still a market
factor,
seems to be
losing some of its momentum, because there
appears
to be less chance of
change with each
grandchildren. For
that,
thank God again and
can
J. B. Braithwaite in
passing day.
The
government market continues to
New York City
time
now.
There
to be
seems
no
vitally important changes in the
composition of the market yet, because the
short-term obligations
continue to hold the
spotlight, with corporations the principal
buyers of these securities. There has
been, however, not an un¬
important amount of purchases of these same
obligations by some
of the commercial banks.
Deposit Banks "Nibbling" at Long Issues
'
'i
?
Despite
the
than
more
the
tight
other
which
money,
affects
institutions, there
are
the
longer
close
certain of the
John
B.
the
Braithwaite, Chairman
London
Stock
arrived in New York
Queen Mary, Oct. 21,
others,
en route
to
"York Stock
Ira
the
Traders
to
program
edu¬
cate the public on the importance
/of ownership in American indusNew York City, members of
New York Stock Exchange,
.are sponsoring an exhibit at the
•five-day National Business Show,
which opened Oct. 20 at the Grand
Central Palace.
1
The
exhibit
.funds
ica."
as
a
share in
buying
industry."
you are
can
?part
mutual
"investment in Amer¬
The firm stated
buy
you
an
features
a
a
that "when
mutual
The
Indicative
of
the
playing in
out that total net assets of
open-end
funds
have
grown from approximately $447,"000,000 in 1940 to over $3,500,000,The
includes
prospec¬
leading mutual funds, to.gether with general literature on
the
subject. Representatives
of
.the firm
swer
,/
are
in attendance to
inquiries
on
In addition the
an¬
mutual funds.
firm
is showing
two motion
pictures: (1) "Oppor¬
tunity U. S. A.," issued by the In¬
vestment Bankers
Association, and
there
are
commitments
to
seem
time
In
non-bank
have
that
real
a
the
addition
interest
buying
to
the
is
of
in
a
commercial
investors that have been oper¬
which
deposit
in,
banks
have
according
to
been
reports,
6/15/59-62, the 2V2S
.
due 6/15/62-67, and
It is not. believed that there will be
any
from the current pressure with the
passing of the seasonal demand
be
nibbling at the eligible issues by commercial
generated
seems
to
be
by
two
motives
at
the
moment.
banks
One
of
these ^securities is when
they/can be obtained at
because
start^jto
the
is
pressure
better
prices
its
at
than
peak,
when
the
level off.
swopping
number^f
into its
come
own
again, with a
involved in this operation
These exchanges appear to run
all over the list, from the
longs into the shorts and vice-versa.
There has been a considerable amount of this
switching attributed
to the out-of-town
banks, with many of the smaller institutions
than
now
has
been
coming
institutions
the
into
cushion
being
before.
case
action.
Ineligibles Moving Slowly
ineligible
under
issues
them
much concerned
in
do
the
not
form
appear
to
have
much
of
a
yet about the
quota¬
tions in order to obtain
them.
State funds continue to be modest
the sell side of the
in
not
too
large
amounts
in
order
to
are
and
meet
still
on
longs being
the
demands
commitments.
With J. H. Goddard
Financial
—
Chronicle)
Richard
Boston
Street,
Stock
members
Exchange.
formerly with Coburn &
brook, Inc., and J. Arthur
&
Co.
of
He
of
an-
$24.00
or
In December of
1942, First National had capital funds,
excluding
reserves, of $83,156,000, which in
December of 1951 had increased
to $174,386,000, an increase of
$91,230,000; dividends of $44,000,be
twisted 000 were paid during this period,
very
much
to
imply that the ^king a total of $135,230,000;
President of the
company himself
? 1S e<lual 1° earnings of $19.37
thinks that investors who
bought a sbar,e perZear for tbe ™ne-year
the stock at 5%
may have been p^lod.1?.n the
capita* of
more
lucky than smart. A year J90 million or $24 48 per share,
would
not
used those words
have
one-half
to
didn't
in
quite
Mr.
ago,
acknowledges, the
ba?ed
the number of shares
outstanding at the . end of each
Beman
company itself
know
where
it
inig92fS i^vestorT^e^e
™ese
was
'
Jn
the
ground
and
u
s
TVmr
a
X
ih
young
ate
of
or
had
you
uncommonly
to
Ban^
ex-
Now
either.
don't
you
All
have
you
to do is recognize
it is very young.
five-year-old
have
a
to
to
be
And
America
such
NTSA
in
as
Cali-
a
tremen-
iq years, but it must be
the
entire
fornia, with
be
state
500
over
"an'dthe
flees
re-
of
Cali-
branch
of -
growth in population
California Zs
hi
able
a
of
covers
to
for
up,
is
recently
was
other banks
are
during the
past
™
been
greater than in
a
the Middle West,
The
Sequoia when
Sequoia,
department
membered, that Bank of America
buy Telecomputing and stay with
it.
,
to oper-
dous growth in deposits
lucky
courageous
the
was
MiddleWarner
(Special
to
The
Financial
Paine, Webber Adds
Chronicle)
(Special
to
The
Financial
Chronicle)
of
operations
Bank
long
of
First
National
Chicago are conducted
roof, as branch banking
under one
is prohibited in Illinois.
GORDON
D.
Many years ago, the commercial
GREGORY
banking department was divided
into divisions, and
today there are
Manager, Bank Stock Department,
Swift-Henke & Co., Chicago, 111.
10
Bank
stocks,
in
represent
the aristocracy of the
equity investment field and since
banks
are
an
integral and
essen-
of
part
Each
with
to
one
in
is
four
addition
subordinate
officers.
has
most
proven
these
of
from
Vice-Presidents,
opinion,
my
divisions.
staffed
First National Bank of
Chicago
This
to
system
efficient.
National also offers the most
First
com-
plete banking service in Chicago,
In January 1945, Edward
Eagle
our economy,
Brown
they will
and
tinue
con¬
grow'
with the ex¬
pansion of
national
our
econ¬
management
First
out
should
ceptional
ac-
for
continue
ords.
omplish-
repre¬
the se¬
with
the
establish
were
rec¬
awarded
outstanding bank management,
ceive
eighteen
sents
to
"Oscars"
Eagle Brown would
tainly be
past
years,
If
Edward
over
working
the
ex¬
the
Chairman
top flight officers through¬
bank,
First
National
many
Chicago,
ments
Board
vanced to the
because of
c
became
Bentley G. McCloud was ad¬
Presidency. Homer
J. Livingston became President in
1950 following the retirement
pf
Bentley G. McCloud.
With this
to
of
one
the
cer¬
first to
re¬
one.
Although First National shares
Gordon
D.
have
Gregory
ing
curity I like best.
Edward Eagle Brown
advanced
years,
continue
should
was
ele-
substantially dur¬
these
value
I
believe
to
they
enhance
in
vated to the Presidency in Febru-
holders
of 1934. At this time, deposits
$582,000,000 and capital $25,000,000.
Today with deposits of
and stockcan
expect
to
receive
stock dividends from time to time
were
as
after
year
earnings
and
year
growth
justify.
$2,322,000,000, First National Bank James H. Walraven With
is the sixth largest in the country,
Dempsey-Tegeler & Co.
and the largest operating without
"
branches
Edward
Eagle Brown
Special to the financial chronicle)
inaugurated a policy
LOS ANGELES
Calif.-James
of building substantial interior re- H. Walraven has become associ-
immediately
—
—
ATLANTA, Ga.—Elise A. Davis
LOS ANGELES, Calif.-Thomas serves, and each year since, all re- ated with Dempsey-Tegeler &
has rejoined Courts &
Co., 11 Ma- J. Fagan has been added to the coveries on charged-off
rietia
rietta Street, IN;" YY
items,Jto- flOJffest
N; W., IHculDcrb OI SISII of Paine, Webber, u aLfvovJU 00
members of staff OI JrdlllCj VV cuUvl, Jackson &
the
New York
Stock Exchange.
Mice
Miss Tlnvic has rpppntlv
Davis Vine recently been with
with
R. S. Dicksori
&^go., Inc.
gckuci
Hp
He
ton
626
wne
was
&
South
Spring Street
Street,
nrpvinnslv with E. F. Hutpreviously with E. F. Hut-
Company.
earnings have been added to
the
■
iLaviaIa
in-
terior reserves.
During
n
Sevei^h^Street He was
sr
m
Curtis,
v
f0rnia, which have had
trunk,
be
department
There
branch and foilage that unmistakably mark the species. Eighteen
months ago
*
1
opened.
mu
characteristics
' ii,* v/
****
the only one of
is
a consumer credit
which
underf
which it was recently a
part. Then
the
c1
....
ioang f0r modernization and repair
and loans to small .'businesses,
u
close and
u
en.
handling small loans, auto loans,
picking well out of the
up
now *
,.
iiauuilJ
V
to- ^ "TV/ *?
TVruIpl fl
?
v.'1
Notice first, nCCu
that its top branches
'?re
X
.
the larger Chicago banks
somethiag ln
sp u! haJ
sapling, and
+
are
First National
rvP
blad!0if.£af'
C'
.
grown into
1*'
S6
wliicn
wondering
a
m-
which S have*- accumulated
the
position of watching an almost
imperceptible sprout come out of
,.,i,ptLpr
do not
earnings
,
Rejoins Courts Staff
F.
Canton has become associated with
J. H. Goddard &
Co., Inc., 85 Dev¬
onshire
receiving
ary
Savings banks
market, with both the shorts
now
dividends
How High Is
Up?—Mr. Beman's
intent, when he
of
as
of
cash
yield of 12%.
a
second half of its first
decade."
National Bank
longer-term Treasury obligations.
There has been, however, some minor
buying in the earlier tap
bonds by private pension
funds, but this has been mainly at
specific prices with no tendency to make
compromises on
other
nual
have
omy.
potential buyers as do the
bank obligations.
To be sure, this could
change over night, but
non-bank investors
seegi to have too many other available sources
into which thdy can channel funds and
do not appear to be too
out
stockholder is
we
allow-
which
computing Corporation enters the
The
-
.
of
Mass.
avenues
Making due
difficulties
not yet beset
us, I venture to express
great
optimism
as.
Tele-
tial
to have
seems
let
The
for
ance
these
buying which has been going on in the higher income
issues, of governments is the opinion that the time to
eligible
acquire
change.
to
specific
of the minor
(2) "What Makes Us Tick," spon¬
sored by the New York Stock Ex¬
BOSTON,
the
pursue.
rather
buyers of the highest yielding taps.
(Special
clearly delin-
eated
must
seems
basic, namely the report that loans in some
instances have been rounding off
and, as a result, these institu¬
tions in order, to protect
earnings have been lengthening ma¬
turities in Treasury obligations. The other
reason given for some
larger
$8.00 per share has been paid
throughout this period, so that for
each share purchased in
1942, a
way.
This
to
of
Mr. Bemen in his first
half report
to
stockholders, "We can now, for
the first
time, see
amme
the
purchasing
any
additional
In 1942, stock sold
below
of
important 200 and each share is now
repreIt has gone
through the sented by three shares worth 250
gateway and has committed itself
each, an appreciation of 275%.
to keep
moving. In the words of The annual cash dividend
rate
come
commitments
ers
Telecomputing is stock.
threshold
in
for loans.
The
exhibit
Then again
making
sharp fanning out of these purchases until there is a
change in
general money market conditions, which cannot be
predicted at
this time.
Nonetheless, the feelings seems to be a bit more promi¬
nent now, that
money
market conditions are not
likely to be
tightened very much more and there
might even be some relief
'000 currently.
tuses of
are
this
selling.
moderate
Tax
are
the
at
obligations
rather
pressure
.so-called
i
than
other
making
fund,
'the financial life of the
country, a
"representative of Ira Haupt & Co.
"pointed
quality
share in Ameri¬
mutual funds
that
investors alike
banks, there are many
ating in this issue.
.try, Ira Haupt & Co., Ill Broad¬
'the
and
2V4S due
the 2.V2S due 9/15/67-72.
Nat'l Business Show
way,
advices,
have been the
Haupt Exhibit at
Extending its
v
to
2%s, with indications
better
New
Exchange.
according
'
the
Mr. Braithwaite is
spending two
days in New York, during which
'time he will confer with Keith
of
maturities of bonds.
near
1958. This bond appears to be
the pivotal issue of
the entire market, because there is
a good
trading market on both
sides of this obligation.
,
.
,
•
.
^
the S. S.
>
President
issues.
the 2%s due
Exchange,
on
Canada to take part in the Cen.tennial celebration of the
Toronto
.Stock Exchange on Oct. 24.
-Funston,
eligible
watching. It is reported some of these institutions have been
showing an enlarged interest in the 2y8s due Dec.
1, 1953, as well
as
John B. Braithwaite
of
certain
making modest commitments
What significance this
may
indicated
immediately* although it will bear very
term
have cannot be
i
that
banks
.
growth.
and
deposit
reports
of the commercial banks
have been
in
the
asking for.
the
on
show
signs of wanting
to do better, even
though the volume is still light enough to
give
it a somewhat
professional hue, which has been evident for some
increased from $30 to
$90 million,
was
accomplished entirely
from earnings without
stockhold-
are
manage-'This
It would be less than
the truth
obligations.
banks,
analysis. Problems
Telecomputing's
are
to say only that
let-up to speak of yet in the preference for
no
Commercial
again.
-
what
ment
shorter-term,
because there is
defined
as the
solving through the payment of
several
engineering problems through- stock
dividends, capital has been
of
great¬
pressure.
Security I Lihe Best
be
electronic
Deposit banks, according to advices, have been in
the-mood to venture out into the
higher income obligations. This
does not,
however, mean they have forsaken the
children
all
be
tended to give the market
after you have
applied the
tests that I have
suggested. And in
the end, if
you, and I, and all of
us
throughout the land make this
personal dedication to the
Ameri¬
can
way of life now, then I know
that the political
security of our
.'country will be safe. It will be
safe for us and for
our
and
to
seems
certain- investors
yours
.alone
we
There
.
Governments
on
By JOHN T. CHIPPENDALE, JR.
careers
careers in
The
(
who
Reporter
======
must pay more atr
we
jtention to those
|in
Continued from
page 2
Our
1
in
in
25
matters and
prior
®rs
past
10
years,
win.
...hi.
"Q,,r»tr 1
oxr
Rrnfh
thereto^ with Buckley.B ot
and Wa
s
,
-
The Commercial and Financial Chronicle
26
Thursday, October 23, 1952
.
ments
with
Continued from
policies and programs of the Republican party in
years past. We have no hesitancy in saying, however, that
we should be more enthusiastic about the present Repub¬
first page
We See It
As
the
demand for
goods unless these re¬
at
rowings by other firms and other
individuals. Some new borrowing,
of
It
such strategy was foredoomed to
event. Moreover,
conceived the idea reckoned without Mr.
course, any
not in the cards in any
was
those who had
intention of being repudiated, and
who, so it is said, was and still is somewhat disturbed
about his "place in history."
It did not take the Chief
Executive long to tell the world in no uncertain terms
that he and his record were the issues of the campaign,
Truman, who had
only thing the party or Mr. Stevenson
indeed the
were
had to
no
If there
run on.
were any
-realistically minded men
lightly, they must
have become quickly disillusioned when Mr. Truman
launched upon his "give-'em-hell," whistle-stop campaign.
Since that time, whether by design or not we do not know,
even Mr. Stevenson, the independent, has tuned his fiddle
in the
country who took these words
to Mr. Truman's fork.
*There
can no
longer be
any
doubt
one's mind that Truman is a vital, if not the key,
of this campaign.
in any
issue
To those who
are
hesitant about the matter let Senator
Byrd speak:
Stevenson
Governor
"After
nominated,
was
the
that, as the candidate of the Demo¬
he would assert an independence
of thought and action and would give assurance that, if
elected, he would change the course of Trumanism, a con¬
tinuation of which, in the minds of many people, means
ultimate disaster.
I had that hope myself.
;
"I have looked in vain for any signs of such indepen¬
was expressed
national party,
thought
cratic
"To those who say
that Governor Stevenson will re¬
from within and will change
I ask that one single measure
form the Democratic party
the trend from Trumanism,
be named wherein there exists
a
difference
on
habit
of Democrats to
against
Harding, or Hoover, or, in still more recent times, against
Senator Taft. This may or may not have been, or be, a
good political tactic, but it has never had and has not today
a semblance of
logical basis on which to rest. The Repub¬
licans may not be really "running against Truman," but
they are in a very real sense running against Trumanism.
Let there be
And
no
a
mistake about that.
precisely, what is Trumanism? 'Again let the
Virginia supply the answer:
opposed, which may be sum¬
marized in brief, represents the usurpation of power'by
the Executive, as exemplified by the seizure of the steel
plants by the President, later declared illegal by the Su¬
preme Court; the trends to socialism advocated by Mr.
Truman, such as the Brannan socialized farm plan and the
Ewing socialized medicine plan; his continued effort to
concentrate more and more power in the Federal Govern¬
ment; the inefficiency of administration and profligate
spending of the Truman Administration, which has given
our Government a fiscal
irresponsibility such as we have
never know before; such measures as
FEPC, which would
invade every man's business and deny the
right of an
employer to decide who to employ, hire or fire in his
private business; and the repeal of the Taft-Hartley Act,
which would make the great labor leaders more powerful
than the United States Government; high and
oppressive
taxes which Mr. Truman did his best to make
higher
without any real effort to eliminate the unbelievable
waste that exists in nearly
every branch of the Federal
say,
bad
as
cannot be defined by any partic¬
it may be, but Trumanism is a
definite, precise trend towards socialism and
away from
enterprise system. In brief, Trumanism is contrary
to the basic principles
upon which America was founded
and upon which it has
grown great."
free
For
do not understand how any American
good of his country at heart can fail to be against
our
part,
we
Now, of
it has been the strategy of the Demo¬
campaign from the first to run against what might
course,
be termed "Old Guardism."
Of this
type of philosophy,
so it
is said, living
exemplifications are to be found in
ex-President Hoover, Senator
Taft, Senator Dirksen, Sena¬
tor Bricker, and a few of their friends
and associates.
We have not
men,
and
Eisenhower, Not Taft
General Eisenhower, a man
we
net drop in the demand for
a
in
too
large.
of proved ability in bring¬
be
a
workmanlike
of
mode
that is likely to occur
of
is
reached
from
in
be dis¬
able disfavor and should
couraged.
No
knows, of course, just
one
how much
be
can
That depends, among
contraction.
other
private borrowing
inV a period of
new
induced
:
things, upon the severity of
contraction." Hence
the
can
one
enough to aggravate seriously the
only
make^a
large
have;< become
problem of controlling recessions.
It is obviously not essential that
private indebted¬
solely by ; private
of
offset
be
ness
borrowing—new public borrowing
will do
Economy?
How Stable Is the
managements and
first
examine
us
in
the
Let
consumers.
the
weak
spots
then
and
economy
the
strong spots.
The large increase in auto¬
(1)
matic
savings
brought
about
by
the recent increase in private pen¬
It is estimated that the
receipts of private pension funds
exceeding their disbursements
are
by
of
receipts
will
ments
It
billion
$2
over
excess
will
business
disburse¬
change rather slowly.
somewhat
be
This
year.
a
over
affected
recessions
because
by
re¬
Government stood
Federal
of
partly based on the size
payrolls and because recessions
will
borrowing which the community
is
willing to do and the amount
$22 billion below the end of 1945
of borrowed money it can prompt¬
—a drop of about 8%.
The Fed¬
eral debt has recently begun to ly spend in a period of recession
are limited.
At the present time,
rise and will probably continue
to rise for several years
of
view
In
uninformed
to come.
of
discussion one reads
the
large
amount
and hears about Federal finances
is worth noting that
these days, it
while
individuals,
business,
state and
the
their debts,
has
Government
Federal
and
local governments have
increasing
been
been
there
are-
bring about
retirements
some
on
time
a
private
come,
pension
important
to
clearly
see
just how and why the volume of
debt creates problems.
There is
no
doubt about the capacity of
increase disbursements from pen¬
sion funds. Nevertheless, for some
to
is
It
the
tq
country
its
interest
the
pay
present debts,
or even
indebt¬
much larger volume of
funds will be
edness.
ably
on
spite
taking in consider¬
than they are paying
more
out in
pensions. These investment-
seeking
funds
deflationary
demand,
funds is
prove
may
for
investment-seeking
dropping.
(2) The large increase in
rate
quite
in periods when the
and
personal
corpo¬
indebtedness.
As
seeing
it rise
rapidly in
a
period
The
more
reluctant
of recession.
the country
see
rise in public borrow¬
is to
ing
billion
$36.4
in
1950,
and
$136.4
World
War.
indebtedness of the country, pub¬
lic and private,
about
has increased only
of
repayments
problem
from
demand
the
of
effect
the
debt
of business contraction.
lem
1945
the
country
occurs
had about 65 cents of private debt
tion
of
debt
annual
on
the
for goods during periods
about
In
by
created
of the national product increased
53%.
with
This prob¬
in connec¬
indebtedness,
primarily
private
not
dollar of annual prod¬
uct; in 1951, it had almost a dollar
of
every
private
debt for
every
dollar
Between
the
end
the
of
end
1951,
governments
public
indebtedness,
since
public bodies can avoid the de¬
flationary effects of repayments
periods of contraction by in¬
curring new debts to pay off old
ones.
But business concerns and
in
of annual product.
of
state
increased
1945
and
and local
their
in¬
private
of
be will¬
in periods of boom.
indebtedness
repayments on the
annual
The
in¬
private
large
become
have
debtedness
enough
of
Volume
present
that it will be difficult
period of mod¬
even mild recession. Con¬
so
to offset them in a
or
consumers
cannot
as
a
rule meet
up to
I cannot offer
precise estimate of the vol¬
time to grow
try has had
its
present debts.
you a
of
ume
they
annual
repayments out
periods
of contraction repay¬
repayments,
quite
be
must
but
large—par¬
view of the many
providing for annual
repayments
over
ten years or
less, the large volume of mort¬
gages which are being amortized
over a 20-year period or less, and
.the large volume of consumer in¬
debtedness outstanding.
One of
ticularly
the
in
loans
figures that is badly
in the statistics issued by
of
partment
estimate
Commerce
annual
of
debt
needed
the De¬
is
an
repay¬
ments.
Of
lem
special interest is the prob¬
indebt¬
many retailers and
created by consumer
edness which
debtedness
1951, the gross debt of the
of
re¬
the
debts,
the country should
in
by nearly $10 billion.
offset
ing to limit the increase of private
end of
debtedness
to
order
in
very
in periods
spending
recession
term
30%.
The
value
(as it did
1945 and 1951), the total
arises
money
money
product has
rising about 53%
billion since the end of 1945. Be¬
1951, net private debt virtually
the
While
value of the national
tween the end of 1945 and the end
doubled, while the
a
and
erate
between
much too
fast.
The increase of net private
debt was $30.8
billion in 1951,
debt
de¬
be
at
disturbed
the rapid rise in business
personal debts, the total in¬ sequently, the time has come to
debtedness of the country, public discourage vigorously any further
increases in net private indebted¬
and private, is smaller in relation
ness—not indefinitely, but for at
to the net national product than
least several years until the coun¬
it was at the end of the Second
been
into
matter of fact,
the
who would
and
and
Corporations and individuals have
going
a
are
of
size
the
about
debt
Federal
people who
many
concerned
payments
cutting its debt.
are
that have been deferred and thus
well,, provided the
is
promptly
as
money
But the amount of public
spent.
about
more
ceipts
just
borrowed
have had occasion
further in¬
indebtedness
consider¬
private
always agreed with these estimable gentle¬
to differ
even
a
should be regarded with
others argue
once
perhaps
(and
Only the Federal Government has
been reducing its debt.
By the
than
period
point
before it is reached)
of new borrow¬
ings—or at least, they are un¬
willing to do so. This means that
more
that
(not
4
page
in
After
contraction.
repayments
Continued
can
rough guess as to
when the repayments on private
Trumanism.
vs.
be easily
can
principal
when due.
indebtedness
Dewey)
vol¬
become
pro¬
What is certain is that this contest is Eisenhower
or
has
paid or
easily be
repaid
The test is
whether the repayments have be¬
come
so
large that they exceed
the
amount
of
new borrowing
cedure.
Taft
you
be used
It is not enough that
the
creases
to
shows
indebtedness
of
the interest
that he has made very real progress
—much to the dismay of his opponents.
Just what the
terms of any amalgamation of forces were we, of course,
do not profess to know.
Mr. Eisenhower, himself, says
he has made no "deals." We suspect that what he has
done is to formulate a working arrangement, which he
intends to carry over into office in support of programs
the precise nature of which is yet to be formulated—
us
analysis
determining whether the
ume
but it would appear
to
brief
This
ing warring elements together and persuading them to
work in harmony, has apparently made a great effort to
revitalize the Republican party and enable it to function
as a
single, unified organization once more. Precisely how
well he has succeeded, remains for the future to disclose,
seems
and, therefore, to
the yardstick that should
Dewey
or
to
goods.
that
for
Trumanism.
cratic
ing
offending the other.
or
enough
prevent repayments from produc¬
even decades, past.
The split has become more
pronounced in recent years, and several elections have
shown the difficulty, if not the impossibility, of one or
the other of the divergent elements leading the party to
when ignoring
borrow
to
net drop in the volume
a
of indebtedness
deny that the Republican party, like the Demo¬
been
Government.
ular program, as
individuals
years,
power
so
also
repayments
prevent
party, is split down the middle, and has been for
sion funds.
"The Trumanism I have
"Trumanism, I
that the
become
quite large, it becomes extremely
difficult in periods of contraction
to persuade other firms and other
run
senior Senator from
with the
cratic
large,
quite
annual
that it is rather worse than
fundamental
policy between Mr. Truman and Governor Stevenson.''
It has become
course,
folly, in light of all that has taken place, to say that the
"reactionary elements," the Old Guard, if you
will, in the Republican party now stand amid the shadows
and pull the strings which govern the movements and
the behavior of their candidates this year.
It would be
which
dent action.
of
so-called
futile to
in years
even
on
Once private debts
become
But the fact is,
But, of
goes
course,
of contraction.
stalwarts.
Foredoomed to Failure
failure.
in the 4otal
drop
payments are offset by new bor¬
of the
some
private indebtedness by
and individuals will
accentuate
points at least it had not less but more
good old Americanism which used to be
part and parcel of Republican credo and is now part and
parcel of the political thinking of some of the party's
of
of
firms
some
lican ticket if at
great pains to give an impression of great inde¬
pendence from Washington and the Administration.
was
*
.
.
(1542)
holders
of
is not too large.
view
that
the
present volume
The
the
of consumer in¬
is not too large labor
Volume
176
Number 5162
.
.
The, Commercial and Financial Chronicle
.
(1543)
the
under
tne
mistaken
question
the
on
oebceaness
and
the
of
to
ratio
that
size
safe
indebtedness
consumer
mainly
belief
end
of
booms in
in-
such
dustrial
disposable incomes
its
other tests that determine
on
At
the
time
present
ment loans alone are so
repayrnents
them
on
plant
and
sense
well'
as
in-
of
equipment
turel industries.
to incluhe
as
in
agri-
non-agricul-
Total outlays on
running plant and equipment from the end
well over $8 billion a
year. New of 1945 through the first half of
instalment
loans
are
running 1952, expressed in dollars of 1952
slightly larger than this, so that purchasing
power,
were
about
the total is still
increasing. It is $214 billion. At the end of 194y
not likely,
however, that new in- the reproducible plant and equipstalment
loans
the rate
period
of $8
of
are
could
be
billion
made
a
in
year
In
recession.
at
the
ment
of
all
investment
an
plant and equipcapita of population and
per
per
member
are
probably
of
the
long-term
still
trends,
much.
any
At
labor
force
little
a
but
rate,
below
not
it
very
will
not
holdings
of
smaller
less
liquid
assets
are
government
in
relation to personal
incomes than they were at the end
of
1945, but they
large.
They are
are
still
an
bling
very
because
research
27
lahoratnripc
is nearly five times as larce todav
as
in 1930
The country is dou-
important
stabilizing influence
the
number
of
chemists
every 15 years and the number of
the
physicists every eight
Total
years
be easy for the scientists and the possession of substantial liquid
expenditures on private and govengineers to develop enough new assets tends to make persons keep ernmental
research (not counting
investment opportunities to bring up their expenditures in the face the
about
net increase in plant and
a
of
equipment
billion
a
$13
billion
That would
year.
large outlays
of
$14
or
be
a
Pse °i about 4%. The labor force
is growing at roughly 1% a year.
falling incomes.
(2)
Fairly
personal incomes in periods
many
0f
a^ the ra*e
about $20 billion
a
depreciation of aboqt£$244 billion,
expressed in dollar sLof 1952 pur-
ergy)
contraction.
During the last
the country has greatly
its
assuring that
arrangements
any
were
atomic
on
times
seven
en-
large
as
in 1947 as in 1930, and they are
much larger today than in 1947.
Technological
research
has, of
course, been enormously stimulated by the Korean War, the defense program, and the keen military competition with Russia
despite the fact that the bad personnel policies of the armed serv-
well
developed arfor partly maintaining
rangements
Of course, with the consumption 20 years
industry °I plant and equipment running improved
American
represented
a
the labor force,
biggest ment
— pernaps
the biggest
I use the word "industrial"
cultural
large that
the
construction
in the broad
instal-
of
one
tne
history
boom.
t-.e soundness of individual credlts.
the country has been
experiencing
depends
of
of 1945
for
drop in incomes
—
yeai\ the demand for plant and fr0m production is partly offset
equipment will always be large, by other forms of income, such
by the principal types of lenders chasing power.
Thus-figure does Nevertheless, we shall do well as umemployment compensation, ices have aggravated the
shortage
were
$5.9 billion; in 1949, $6.5 not include
inventories or un- alter the defense plants have been pensions, old-age
assistance, or of scientific and technical personbillion; in 1950, $7.6 billion. Hence developed natural resources, built to keep the total expendi- general
relief
payments.
Such nel by unnecessarily interrupting
a fairly substantial contraction in
Hence the expenditures on
plant j;ures
01, Plan1j and equipment forms of income come into exis- the training of many men.
the outstanding volume of instal- and
equipment during the last six ^ew
a^d r.ePlacements) ™uc. tence only because of contraction,
No other country, except perment loans is
likely to accom- and a half years Have been about above $30. billion a yean Ir is and they fall
substantially short haps Russia and Canada, has expany a
recession.
Consequently, 88% as large as the total invest- n0w runmn£ about $36 billion a of offsetting all of the loss of perienced such a vigorous boom
1948,
instalment loans made
new
during
year
the
next
level
of
every
effort
when the
year,
business
will
should
be
be
rrent in plant and equipment less
high,
made
depreciation
to
the
at
beginning
of
the period/*
year*
(5)
of
income from
The fact ihat the "umber these forms
housing
new
starts
has
for
mitigate
production.
income
of
in science and technology as has
the United States. This boom has
Hence,
only
can
recession—they cannot .greater economic significance than
prevent one. Their mitigating in- you might expect. Not only does
fluence, however, is important; the larger volume of industrial
increase
would
simply lay the lowed a 16-year period marked by
The arrangements that have been research mean that industry is
foundation for trouble in a year the
great depression and the war
added to the economy in the last better able than ever to increase
of recession.
during whifib^fimp thp nlant and
depression and the war, so that 20 years to provide income to per- the output of goods—it also means
Repayments on real estate loans equipment
American industry the wartime
and P°stwar mar- sons who lose their jobs assure that industry is better able than
can
also
troublesome
It
were
only about rlages created an acute housing that the loss of income from a ever to increase the demand for
argued that the navments fin these
as rapidl\<# !thev
were wearing
shortage- The shortage was ag- recession would be offset to a goods. Research increases the de-"
prevent
further rise in the vol-
a
of
ume
credit.
consumer
Such
The
an
be^
on
recent huge
expenditures
plant and equipment have fol-
much
not
larger
that
amounts
rapidly.
the
that
people
would
ment
be
navinp
in
paying in rpnt naa thpv not hprent, had tney not
pe
come home
owners.
Hence, it is
said
said
on
that
tnat
the eiiect nt
tne effect of
of
finite
quite true.
course,
interest
and
to
of
mortgage
the
on
extent
garded
current
as
ex-
To
likely to
are
•
the
tne
meantime
meantime
a
I
u
g umtsinci eased oy ovei
,,
b
million,
families
while
the
increased
ldPPnes rSo
In
mlihon.
be
at the end of the war, nearly 59%
of the expenditures on plant, and
re-
and
income
larger
anv
a^era^ .a^
that
be
in
in
?i
of
end
number
bv
fh
1952,
■
the
ot
about
4 3
in
to
expected
siderable
last
to
period
for
con-
a
of
time, because
people have a strong pref_
many
X^'di"
ft
ofbeS&toTto 'fhl even? of rectlftl Cnber
01 Pensl0n Plans- In the event of 0D130'rtunities
b
a
moderate recession, I suspect
tbat manv firn* will adiust thpir
work forces to
bv
retirincr
drop
a
older
in
younger
tbat
than
hv
workers
this
will
rangPmPnt
T
he
not
am
it
ar-
will
that
great
fairly
liberal
plants,
in
however
consumer^
their
of
incomes
on
' ■
A rlse ln the Proportion of in-
co™es. sPeiat
a
consumption
on
is
quite important. Not only does the
resulting rise in consumption in¬
is
£ause
to
offer
consumption.
pension
exist
now
many
bound
proportion
in
The
arrangements
industry
thereby helping industry induce
individuals to spend a little larger
sure
desirable
a
Tertainlv
new
of mak-
wave
" neips industry oner consumers
new and more attractive goods
off
lavina
troduc^^
fact
it helps
ui
the pensionable
passed
now
develoninf*
new
pew processes, new ways ot makm£ things.
In the second place
who
•
rather
a£p
nrocesses
demand
workers
u
of
opportunities oy developing new
and superior kinds of equipment,
many urn* will adjust tnen
aoout 1.6 have
increase
the
number
of
dwelling
units
increased by 18 million, or nearly wm he about
50% greater than
15%, and the civilian labor fore the increase in the number of
by 4.7 million, or over 9%. As a families.
result of the high
A high demand for houses may
industrial plant and equipment
retnrn
a
equity.
owners
they
are
1929—though
tnougn
tbe
and
u
the population of the country had
the
considerable
a
tenh rental payments
of
01
1947
of
^ ^ eVer ^ STftart
bv
thf
1951) however, the number of
purchasing dwelling units increased bv over
j^diceiy any larger
pay
on
ginnine
exnressed^n'rS21
when
constant
..
the end of" 1945 than ~at the end
part of the
repay
a
house, but to
to
of
power was scarcely
puwex was
This is
often used
are
principal
depreciation:
£3^
uep^id^^yjmeii expressea m
Pavrnents of rent
Payments ot rent,
true
not evdn that
Ag Result, the invest-
plant and equipment less
in
dollars
renavmente
repayments
mortgages is negligible.
not
not
several years been substantially
outrunning the increase in the
number of families. Residential
constru?tlon was low during the
W
Ts
VStUTSfttS out—?n soiwjtlears
are
a
managements to
currently spent by their recip- equipment during the last six and eren'ce
for
living
in
detached make greater use of retirements crease the number of investment
Repayments of the prin- a half years have been needed
dwellings that they own, because as a method of cutting the labor opportunities, and thus raise the
cipal on real estate loans, however, to offset depieciation and obsoles- more
and more people prefer to force when the demand for labor amounts
spent on
investment
are regarded
by their recipients cence.
The investment in plant jjve outside
congested districts, drops
goods, but it also raises the seeas repayments of
capital. They do and equipment less depreciation and because the
monthly out-ofSnm„
wkl„,
ondary effects on demand of every
fo e
ients.
,
^
not
the
form
basis
'expenditures,
for
the
but
in
expressed
current
basis
creased
for
1952
from
dollars has in-
$244-billion at the
pocket cost of living in one's own
home
and
paying
installments
on
nel.Vs
dol.lar spent on investment goods,
1 18 obvI°ua that the increase in
Theereat deferred demand
oltadividS^nd
end of 1945 to $335 billion in the a mortgage is little
greater than nnlesth^
Hence, if a drop in the general middle of 1952, "or about 37%. '
paying rent.
Nevertheless, now tb
second World War has been
level
of
businessV produces
a
Population ;; and
the
civilian ..that the housing shortage in most
pretty completely met. There is
shrinkage in investment oppor- labor force, of course, have been cities is no longer
acute, it will no rpac0n to exnect that deferred
tunities, repayments of real estate increasing too. Between the end not be easy to find a market for
demand |0r
investment-seeking
new
funds,
.
lqans will
be
deflationary.
sequently, the next
the
time
when
year
Con-
or
further
so
of
is
1945
the
and
middle
investment
when
in
automobiles
of
1952,
plant
and
increases
equipment roSe 37%, population
in the total outstanding volume of increased
almostS:13%
and
the
real estate loans should be vig- civilian labor force a little more
orously resisted.
than 13%.
If one compares the
_
(3)
of
The fact that the maturities
E
1953
will
bonds
smaller
1955
in
be
considerably
1956
and
than
in
pre-war year of 1939 with the
middle of 1952, one finds that the
investment in plarrt and equip-
1.1 million
units
or
1.2 million dwelling
One dare not expect
a year.
the experience of
peated.
for
to
be
re-
At'that time the demand
houses
was
affected
was
1949
small drop in
for the year
residences
so
very
that
little
by
employment,
as
a
whole
started
were
it
the
great
and
more
than
in
will
billion
in
lion
in
1954
just
1952
1953
In
hond
there
E
1955
To
the
in
pay
owners
continue
reinvest
or
1956.
H
new
bonds,
securities
other
of
to
their
ian iabor force nearly: 14%. The of defense spending.
most important comparison is between the 7ears 192? and 1952'
IV
because
comparison
s^ows ^a^
to
large outlays on
,
on^ hand and/ population and
,
!?b?r
wdl
^
mitigate
^
pubiic
roads
jn
recession
new
a
jn
1949
^be
supply, sewage
0f
they
ably larger today than they
^^/paufnmenTles:
j?lant 2
edulPment leuss
™ent
no
problem.
doiiarq
of
'
constant
noDulation
BOwer
buy houses
or
con-
because
tends
it
to
in-
the demand for houses and
eonsumer
defense
goods
spending
this demand
at
the
at
and
iifst.
defend spenang
soendiw
peak
to
tuan th„ „rowth in
ahor
d0r
about the time
drops
ar p .
w
Thevrnvthofnlamand
been
of
reduce
nurchasine
hv nearlv 304'
|I„T („L
?oS
expenditures
on
a
high rate of
plant and
equip-
ment has pretty well supplied the
country
with
new
and
efficient
producing capacity. Ever since the
0f
lation
The large volume of liquid
The Second World War,
is well known) saw an enor-
littte
creasing
space.
.
.
than
takes
penditures
time
to
end of 1939 to $138.6 bil-
li0n at the end 01 1945'
have continued to increase
cause
public
on
there usually is
g
u
,
by
$4 j
eth°,
and
made
by
bringing
estimate
of
Kuznets
is
which
has
not
fairly
down
for
to
1938,
by
date
is
the
prob-
such
and
as
TaLr're-' credit
yet been published,
semi
-
union
the
in
last
20
years
industry in a
far better position than ever before to fight recessions because i '
the demand
puts
for
(5)
that
i,y
the
control
goods to
r
ever beforr
of
industry.
The strong spirit of cautiodomjnafes
decision
managements
and
-
makin"-
consumers
Both managements and consumer
what
WOnder
will
happen whe-
%dna'S&vZspendlngThis makes thedefenSe H dr0p3'
fear
sizable rise of
government
liquid
dollar
American
within
assets,
corporate securities, state
local
places
°nTvharious S.inA 0fo?fub;
Re's' andTw^d Better consumer
sa^.1"?s a c' !°
ties ana new ana
bdUon.
These goods Perhaps the most impor-
u"ed.°whkh f'3-5 billion in semi-liquid
^ 3^^'be'indT/ated
search
a
every
They year,st more'.at least: s.tates and greater extent than
since localities
will spend increasing
tant
thing
that
has
been
going
Srne! the,re 's aJ long-run ten- of $2.1 billion
been
on
The rise of applied science and
technology
It seems certain that for several
in personal holdings on in the American economy m
dency for plant and eqmpment t0 of u- s- government securities, recent years is the enormous
grow relative t0 P°pulatio" apd During the last two years there boom in science and technology.
.
lr
effects on demand of
spent on investment.
'
,
income
be-
works
more or
J"
S
in
consumption raises the secondary
S
at' $156.8 billion, he works. These will help offset
t,w,° yf,ars .sm5® the out"
d
defense spending.
break of fighting in Korea, per(4) Recent important gains in
sonal holdings of currency and the capacity of the economy to
?
?TriSinal„ increase
Hence the
ex-
make
of planning and reaching agreement has been going on steadily,
;ngs of iiQUjd assets.
gains were partly offset by a drop
.
faster
origin
success of industry
persuading people to spend
schoolroom larger part of their income
ingS) exciusive of trust funds, increased
fr0m about $45.1 billion
expansion in personal hold-
m0us
more
nonulnlinn and
It
secondary effects of the
Likewise, the popuage has been in.
school
These hold-
as
Population and shares
forS
1940.
of
^
rise in spending which created th
registered than at the
less
disagreement about just what to
do and where to build the new
roads or new schools. The process
resources.
has
<4) The fact that
end
^n th.e ,enrc? °f. 1945' and at0 tbe,1?nd
off debts, the timing
creates
(i)
trucks
^ef^"
The recipients^ of th<
is
plain that the larger the propoi
"on ot any increase m mcon
which each recipient spends o
consumption, the larger are t
were
cars
fo?
u.
^
liJJ;
prob-
are
Id 1
part ot tne dollar spent^c
and
In fact,
Lmanrf
1
o n a
<
consumption spend most of the:
other public
works> the unmet needs are still
enormous.
d?H
dollaJ sPe"t on investment gooc
spend-.most
the dollar ocrcon
sumption, and the recipients c
as
fieid'
d
.
m+er\
by created
construction however,
schools,
hospitals,
water
and
,
What are the principal elements
0f strength in the economy?
°0n the othei; han+d at the
goods, the timing is unfor-
tunate
shows
Plant. and equipment during the
last six and a half years have just
at)cut restored the relationship
dptween
and equipment on
K
or
this
the effect of both the- depression
a"d the war. This comparison
the money from their
use
maturities
crease
in
extent, however, that the
owners
sumer
E
drop.
outstanding,
that the
the
in
the
is
the
also
billion
bonds
of maturities
To
will
$2.2
E
or
it'to
however
spending
now
bonds
money
bonds
in
maturities of $4.4 billion
extent
E
bil-
billion
dropping,
bonds
$3.3
$5.1
1956
be
and
maturine
use
and
defense
to
are
in
*hold
$5.7
maturities
Of the
about
about
to
and
1955
when
expected
from
rise
•
inv
^""yen induS muS
the previous year. From now on, a few years ag0.
Certainly the
the demand for: houses will be car and truck
population has been
their peak, business will be sus- power has increased nearly one- considerably more sensitive to any
increasing faster than the capacity
tained to a substantial extent by third, while population has in- drop in employment and incomes 0£ roads
At the end of 1950 there
the large maturities of E bonds creased nearly 20% and the civil- that may accompany a contraction ^verg
50%
more
which
"a
of
houses
passenger
1954.
During 1953 and 1954, ment less depreciation expressed
when defense expenditures are at in dollars of constant purchasing
or
demand that results from some?ne s df.clsl,on, '° lavest a dollar
.
securities,
shares,
and
assets.
Individual
This
boom
goes
back at least
50
years, but it has been particularly
strong in the last 20 years.
It
is indicated
by the fact that
the
other number of scientists, technicians,
and
engineers
in
industrial
and-
a recession.
cautious.
The caution of manage-
ments is reflected in the reductio"
of inventories during
j
retailing
and
in
the
durabie
branches
in
manufacture
£oods
of
_
in
business
manufacture
..rhetr~
the last year
wholesale
r;cp
of
;n
of
short
trade
non-
in all
except
durable
the
"oods
invpntoHr- d-r-
wheie the rise m invento.i
Continued
on
a,r
page Zo
23
The Commercial and Financial Chronicle
(1544)
Continued from page
the opportunity taxes?
Some cuts in taxes will
pay off debts probably have taken effect about
funds from new equity issues Jan. 1, 1954.
two
next
27
with
ing the last
below
10.4%
were
quarter of 1952. In that quarspending was at the
first
defense
ter
a
— $18
matter
reality fell short of the
inventories
annual
billion
less.
billion
rate of $46
7% below, and inventories in the
manufacture of non-durable goods
year
wholesale
ago,
far
how
And yet,
no
previously announced as
for security, the country
decline
in the wholesale
price has always been told in the quarlevel, but most of it represented terly reports of the Director of
Defense Mobilization that the dea drop in the physical volume of
fense
program
was
going fine,
inventories.
below.
was
attributable
Caution
the
to
businessmen.
necessary
and that the security
is
consumers
among
much less pronounced
schedule
drops
small
these
Part of
1£%
try was being
than among
Nevertheless,
factory rate.
per¬
however, that
be noted,
has
been
a
ask
spending (including foreign
fense
rise in
marked
character-
of defense goals
setting
schedules, I do not hesitate to
whether the plateau of de-
and
18 months
daring the last 15 or
there
the
ized
in. relation to incomes after taxes.
It should
of the coun-
built up at a satisIn view of the lack
of frankness which has
still fairly high
sonal savings are
to aid), which has now been set as
buy. Between the second quarter necessary, namely, between $60
the
disposition
of
consumers
of 1951 and the second quarter
and
billion
of
billion
$65
year,
a
1952, the annual rate of personal
incomes after taxes increased by
really is necessary. Perhaps it is,
but the country has not been told
$3.3 billion, but personal consump¬
why.
The advantages of a lower plaexpenditures increased by an
annual rate of $10.4 billion.
The teau (say around $55 billion a
-Kiqninishing caution of consumers year) are substantial. The lower
reflected also in the sharp rise plateau would mean that the ultition
in
credit during the last
consumer
Consumers show no dispo¬
sition to reach for goods, but the
year.
their
spending for consumption faster
tendency for people to raise
should
incomes go up
than their
fee
discouraged, at least during the
.next year or so.
V
The
analysis
foregoing
makes
plain that the drop in defense
spending is likely to begin when
aggravate
contraction. Consequently, the
the
is
and
likely
to
to make careful
and ambitious plans to prevent or
limit these effects. Furthermore,
needs
country
begin mak¬
and executing
the country needs to
plans
these
ing
them at
and without regard
once
special in¬
to whether this or that
the
the problem of
country,
to
is
compatible with our
not
national
security and our-foreign
policy.
In
discussing
averting
the
recession,
a
of
problem
begins
defense spending
vear
a
' ru'i-
,
drops will be the biggest problem
the terrific
liberalization
many
cessful
cases in
policy
avoidance of recession
spending drops
because
sion
even
the
in
bnve
defense
as
closely related
are
moderate
a
the
and
United
reces¬
would
States
suMM?acrres
I do not
responsibilities of the Presidency
next January. Indeed, the devel¬
opment of a satisfactory and suc¬
foreign
i
*
2ES1
where
But there
which it
is
the board
thlre
tnere
the
to customary
high.
cases
because
Because
cases
benefits
too
Bankers
of
earnings
is
also
many
too low.
Such
are
found among the
are
are
ratio
higher
paid workers. In order to get the
maximum
stabilizing effect from
C.
J.
the
32nd
Investment
Association
Hasan, Jr.
America
of
LeRoy A. Wilbur
quite sensitive to price, so that a
lower total of price plus excise tax
would raise total consumer expenditures for the article; and (2) reductions in the personal income
tax. Cuts in the personal income
tax are roughly equivalent to increases in income and should produce pretty much the same rise in
the demand for goods that higher
to spend (or to attempt
that business can make toward
Goodwyn,
Homestead
™d
droppmg. Unless pnyat business
™vs signs of vigo^expansion,
the principal contribution a Period
L.
W.
Jr.
R.
will be held Nov.
incomes bring about. Since the inThe new Ad- come tax is already steeply pro-
their incomes on consumer goods.
is
Md.—The
of
cessful. The tax cuts most likely to
stimulate employment are (1) reductions in excise taxes on those
products for which demand is
Jj ?Pend) a larser proportion of
Tbls
Group
ern
budget of the Federal government
ment opportunities and to induce will be in the red during; the pe-
I consumers
however,
shall continue to assume that the
lion
BALTIMORE,
Annual Meeting of the Southeast¬
There
the
of falling Federal spend-
^ is a time when^medeficit
A.
Bigger
1, 1952, at The
Hotel, Hot Springs, Va.
been
has
appointed, for
presenting nom¬
of
purpose
inees for officers and members of
the Executive Committee to
for the
ensuing
year, a
serve
committee
consisting of:
Charles S.
Alex.
Garland, Chairman—
& Sons, Baltimore,.
Brown
Maryland.
to increase the volume of invest-
*
Group of
IBA to Hold Meeting
planning a substantial expansion all income brackets,
toU r°ads to be under construeTax reductions which accomtion on a large scale early in 1955. pany the drop in defense spending
(5) Step up industrial research W1U probably mean that the cash
whether
Thursday, October 23, 1952
.
question
plateau problem and decide
a lower and longer pla-
to the
teau
the
to
answer
.
Southeastern
ministration should lose no time in gressive, the cuts should apply to
when defense spending
of whoever shoulders
«j»he
oromotlv
itself auite
address
tinn
prevent or to mitigate a
recession
debts.
of toll must depend, of course, upon how
roads and start and expand con- large are the tax reductions effecstruction of them as defense tive in 1954. Uuless tax cuts effecspending drops. The nation is now tive in 1954 are quite large, addiwasting huge sums on a poorly tional cuts will be needed when
planned road program. Because of defense spending drops. Since the
failures to distinguish between the government will be spending less,
needs of local traffic and through the public must spend more, or
traffic, roads which should serve total demand will drop. But the
through traffic
are permitted public will be able to spend more
gradually to be converted into provided the government reduces
congested business streets by al- its tax take from the incomes of
lowing business establishments to the public. Furthermore, the pubgrow up on the sides of the road, lie,
with larger incomes after
This has happened on such a large taxes, will be willing to spend
scale that the nation lacks an ade- more.
quate system of through roads.
What kinds of taxes should be
The nation needs business streets, cut? jf
eXcess profits tax, or
and it also needs through roads, any par^ 0f ^ js still on the books,
but where traffic is heavy the two
should certainly be cut because
uses do not mix — they conflict.
penalizes just the kind of enterFurthermore, the nation has too prise that can do most to increase
long uncritically followed the empi0yment. Except for the excess
socialistic principle of the govern- profits tax, however, corporation
merit's constructing roads and of- taxes should not be touched. An
fering them free to whoever cared attempt to stimulate investment in
to use them. That method is in- a period Gf possible recession by
evitable in the case of local traf- cutting the normal corporate infic> bu}. j* is not inevitable in the come tax is not likely to be suc-
likes the plan. Next latp in 1954 or parlv in 1955 and
only to the problem of working
that the plateau is about $60 bilout a satisfactory foreign policy
bow
to fund short-term
new' Administra- defense spending.
that the
priate
drop in
terest group
for
to
case of through traffic.
The strong and growing demand
for roads well adapted to through
mate
drop, in defense spending traffic means that sufficient toll
would come later and be smaller! revenue could be collected on a
It would mean buying less equip- considerable mileage of new
ment that will almost immediately limited-access
highways in the
become obsolete.
It would mean East, Northeast, and parts of the
that the cash budget for the pres- Middle West, South, and Far West
ent fiscal year would be in bal- to Pay maintenance costs and to
ance
or
virtually
in
balance, amortize bonds issued to pay for
Since a major problem of the new the highways. Hence the demand
Administration will be averting f°r through-traffic roads creates
or limiting a recession when dean investment opportunity which
fense spending drops, it is appro- can do much to offset the drop in
normal business trends are down¬
ward
used
(4) Plan a large program
is explained by defense spending would be at the
annual rate of $64 billion in the
year
tbe expansion of military produc¬
tion.
In August, 1952, retail in¬
ventories
or
Economy?
How Stable Is tbe
years,
be
should
.
C.
Edward
&
son
Anderson—Ander¬
Strudwick, Richmond, Va.
Folgef1— Folger,
Clifford
John
Nolan
Washington,
Incorporated,
C.
D.
committee
This
has
the
made
averting a recession as defense m the budget is needed. As busi- following nominations:
Chairman—John C. Hagan, Jr.,
spending drops. It is by far the ness later expands, the rising yield
most important of all the possible of Federal taxer will probably Mason-Hagan, Inc., Richmond, Va.
anti-reeession steps. It may seem soon put the budget in balance.
Vice-Chairman—LeRoy A: Wil¬
st/ange to suSgest that research be
stepped up
being quite
when
it
is
generally
under considerable pressure and is
bejng hampered
sonnex
by
bur,
already
conducted
lack of
per_
Furthermore, research has
to be planned well in advance and
cannot be expected suddenly to
produce
new
products,
new
unemployment compensation and methods, or new materials in repension plans, the benefits should sponse to a demand or need for
Stein Bros.
more,
&
Boyce, Balti¬
Md.
This analysis of the problem of
Vice-Chairman—W i 1 f r e d
L.
averting a recession when defense
spending drops shows that the Goodwyn, Jr., Goodwyn & Olds,.
problem fis tough.
Our analysis Washington, D. C.
Secretary-Treasurer
Richard
also shows that the instruments
available for dealing with this A. Bigger, R. S. Dickson & Co.,
—
tough problem are powerful. Cer- Charlotte, N. C.
tainly the possibility exists that
In addition to
the .above
offi¬
the powerful instruments avail- cers, the committee has nominated
able will be used so wisely and ef- for election to
the
Executive
fee a serious setback to our foreign
fectively that no recession will Committee:
the will to work.
jn 1954 or early in 1955, or even occur. Human beings, however, do
poJicy.
W. Carroll Mead—Mead, Miller
(3) Resist strongly for the next before, there will be a consider- not usually show such wisdom, &
What can the United States do
Co., Baltimore, Md. (For a onerepercussions
throughout the world and would
far-reaching
to limit
or
cession
in
prevent
a
business
general
re¬
defense
as
spending drops? Some of the steps
can
best be taken by
•others
can
government;
be taken by business.
I shall not attempt to
Mads
of
list the two
separately,
steps
sfeall indicate briefly some
most
important
but I
of the
ones.
(1) Keep the plateau of defense
spending
as
low
as
national
secu¬
be
high relative to customary them. Nevertheless, there is some
earnings as will not undermine good in its
being known that late
as
year
or
two further increases
in
the total volume of corporate and
personal indebtedness.
ready
explained why
needed
in
a
During the next
in-
year
the rise in the indebtedness of the
Federal
Government
need
for
new
enterprises
markets
which
and
are
responsible
years
fashion by the
Throughout
the
last
will
tant
two
the Executive Branch of the
Government, including the Armed
Services, has been far from frank.
ready for buyers' markets will go
country with the increased
markets
prob-
money
supply required by the growth of
than
the
wage
rates
crease
in output per man-hour.
in-
A
(6)
Cut taxes.
This is the big-
gest contribution that the govern-
fee
imperiled
if
these
schedules
claimed
in
The schedules pro¬
the early or middle
months
of
1951
were
not met.
red
will
by
moderate
a
defense
Corporations
can
miti-
ments of debt to aggravate recessions by replacing part of their
claimed and the country has been
told that national security would
the
capital.
for defense goods have been pro¬
and
in
amount. It
probably still be
in the red in the fiscal year 195455—the year in which the drop in
gate the tendency for the repay-
goals
be
rise in labor costs and prices will
increase
the
need for working
schedules
Production
indebtedness
ties
and
with
funding
short-term debts.
demand
for
equity securtpart of their
The tremendous
capital
spending is expected to
begin—unless the plateau of de¬
fense spending has been lowered
or
other cuts have been
government spending.
sume
that
fiscal year
the
prospect
in
made
Let
us
as-
for
the
1954-55, with the
last several years
has pretty much
remotely met. In July, 1951,
the country was informed by the
precluded
replacement
or
balance
likely, there
perhaps
Council of Economic Advisers that
is
have
not
been
funding. If,
a
such
as seems
during
drop in investment
'
do
in
so
over
the
the
in
on
a
large
government
banks discouraging further
net increase in private indebtedness, and
with the • government
and
year
period to succeed W. Peyton
the
even a
cash
budget—or
deficit in the cash
budget. Do I still suggest cuts in
•
i
Walter
S.
Robertson—Scott
of
&
Stringfellow, Richmond, Va. (Exofficio.)
James
Lemon
Johnston,
Co., Washington, D. C.
(Ex-officio.)
Lemon
H.
—
&
making cuts in taxes to take efThe annual business meeting is
fect *n 1954 or 1955, the recession
can be kePt mild- The develop- being held during a conference of
the Group on Oct. 31, Nov. 1 and 2.
ment of policies to deal with the
reduction in defense spending Joseph T. Johnson, President of
the National Association, and Mr.
should be the major concern of
business for the next two years Murray Hanson, General Counsel
of
the
Association,
will
speak
and> nex* to the development of a
satisfactory foreign policy, it briefly at the business meeting.
Reservations should be made as
should also be the principal con- soon as
possible, direct with the
cern °f the new Administration,
Homestead
Hotel,
Hot
Springs,
Va., attention of Mr. J. L. Ruddell.
With
Penington, Colket
MANHASSET,
Y.—Pening¬
ton, Colket & Co., members of the
„„„
^
^
xorK btocK .bxenange,
an-
nounce *hat Edward Barry has
become associated with the firm
as co-manager
as
only
a
limited number of
rooms
available. Special rates for the
Convention
are:
Single
Room,
are
N.
de-
fense expenditures dropping after
Jan. 1, 1955, is no better than a
even
not
products will
profit research continuing
A general attempt to get scale and with the
far to prevent buyers'
ably be sufficient to provide the from coming into being.
faster
probably
new
greatly.
the
Con¬
will
pre-
physical production. Some rise ment can make toward averting or
rity permits.—The country badly
in private indebtedness may be limiting a recession. In the
present
needs arrangements by which the
defense program can be critically inevitable, particularly if unions fiscal year the cash budget of the
raise labor costs by pushing up Federal government will
reviewed from time to time in a
probably
gress.
and
formulating policies when defense
May, Investment Corporation
pared to offer important improve- spending drops. Hence some recesNorfolk, Norfolk, Va.)
is ments in their products or impor- sion is likely. But with industrial
pause
the rise of private
debtedness.
able
that
I have al-
of its office at 568
Plandome Road, Manhasset.
$17.50
(Twin
per
day;
Double
Room;
beds), $16.25 per day per
person; Parlors, $12 per day. The
registration fee is $10 per person
in
attendance, not including wives.
Members
Committee
of
are:
the
Convention
Thomas L. Anglin
1
<•
Volume 176
•'
fw.y'vWV
is
Number 5162
The Commercial and Financial
Chronicle
.
(1545)
Mackall & Coe, Washington, D. C„ win B.
Horner, Scott, Horner &
.and M. Carter
j\
Car Loadings Continue Decline for Week and Year
Gunn,'Scott,Horner Mason, Lynchburg,
Va.; Harvey B.
& Mason,
Lynchburg, Jqo.-jChair¬ Gram,
Loadings of revenue freight for the week ended Oct.
Johnston, Lemon & Co.,
11, 1952,
men of the
totaled 842,713 cars,
Entertainment Com¬ Washington, D.
according to the Association of American RailC.;
Francis C.
mittee; Richard A. Bigger, R. *S.
Hunter, Merrill Lynch, Pierce, I roads, representing a decrease of 9,153 cars, or 1.1% below the
Dickson & Co.,
Charlotte, N. C.; Fenner &
preceding week.
Beane,
Washington,
J. T.
The week's total
Warmath, Equitable Secu¬ D. C.; Frank D. Mead, Mead, Mil¬
represented a decrease of 25,970 cars, or 3%
ler & Co.,
rities
below the
Baltimore, and Frank
Corp., Greenville, N'. C.;
corresponding week a year ago, and a decrease of 46,176
29
j
,
Ben
J.
S.
Willis,
Alex.
Brown
&
Taylor, Jr.
cars,
Edwin B. Horner is in
the Golf Committee.
Sons, Winston-Salem, N. C.; Ed¬
charge of
5.2%
or
blow the corresponding week in
Suburban
chalked
above
the
resulted
under
preceding
from
the
United
increased
Mutual
It also
in
month,
noted
about
military
$30
and
million
1950.
economic
aid
purchases
abroad
shipments
took
cotton
of
output for the past week was made up of
104,391
and 29,502 trucks built in the United
States against 99,974
and 29,133 trucks
(revised) the previous week and
place in August
and
wool
textiles,
and diamonds.
Incoming goods were valued
million, compared with $837 million in
July and $880
August, 1951.
■--■""/-/'.'-■"•'t
$817
Money in circulation in
rate surpassed
the
United States is
only during World War II.
increasing at
In the five and
a
.
;
a
important factors, they add,
operations, ;tax evasibn and
r
monetary experts
are
return
a
of
But
say.
some
migration of population
from the defense
program and the Korean War.
last
w&ek
of the
and were almost even with their
week's decline centered in small
bilities under $5,000, which dropped
17
the current week.
The
week
Slight Rise This Week
orders
now
that
the
were
thought the first
two
months of
1953
cents
in
trend
industry bursts
forth with
a
the
government gives
Controlled Materials
to
consumers
buy steel with under
a
31
year's
castings
industry produced
•
the
prior
the
record
steel
.
of
week
set
ended
in
was
-
;
108.5
July 1 it
18.
To
capacity.
That's
a
set
new
reach
%
the
was
output for the
week
1951, and 1,178,792,000 kwh. in excess of the
output
corresponding period two years ago.
:\
reported for the
Oct.
1
forecast of
this
a
year
)
ago.,
scoi^
were
Ore.,
the
demand for television
sets continued to climb.
In
the week,
in
.
..
r
wholesale volume
of
all
types
of hard
wheat
sales
as
Shipping directions showed
the result of cooler weather
over
firm, aided by better shipping
.
through September
was 1,534,000 bales, as compared with
1,476,Foreign demand for cotton continued in limited
Domestic mill buying slackened somewhat with
reported
the
ten
spot
markets
totaling 347,700 bales last week,
against 412,200 the preceding week, and 357,100 a year ago. Trad¬
ing in cotton textiles was limited with prices mostly
steady.
Trade Volume
Retail stores in
Unchanged From Week Ago
most parts
in the period ended on
week.
of the nation sold about
Wednesday of last week
Special seasonal promotions and
strumental in
retailers had
was
sustaining volume.
easy
as
Department
1
store
country-wide basis,
sales
on
a
taken from
as
the Federal Reserve Board's
index
for the week ended
Oct. 11, 1952,
rose
6% above the level of the
preceding week. In
week
week
the
previous
increase of 5%
an
corded
from
those of
of 1951.
was
the
re¬
similar
For the four weeks
ended Oct. 11,
1952, sales reflected!
increase of 2%. For the
period
an
Jan. 1 to Oct.
11,
1952, department
store sales registered
a drop of 1%
below the like period of the
pre¬
ceding
year.
Retail
week
trade
in
reflected
volume
for
New
York
favorable
a
the
first
time
last
sales
in
28»
weeks.
The
the
increase
was
substantial
trade,
special
attributed
Columbus
additional
Day
openings,
night
promotions.
According to the Federal Reserve
index,
sales
New
in
department
York
City
store
for
the
weekly period ended Oct. 11, 1952,
decreased
6%
period of last
below
year.
ing week
/
the
decline of 2%
a
like
In the preced¬
was re¬
ported from those of similar week
of
1951, while for the four weeks
ended Oct. 11, 1952, a decrease of
5%
of
was
a
registered below the level
year ago. For the period
JtoJ
1 to Oct. 11, 1952, volume
declined!
9%
under
preceding
the
like
period of the
year.
>
,
F.I. F. Sales Co.
j
Charles E. Bacon is engaging in
the securities business from offices
at 120
under
Sales
Broadway, New York City*
the firm name of F. I. Fi
Company.
R. E. Warren Co. Formed
Robert
offices
York
E.
at
Warren
Fifth
550
has
opened
Avenue, New
City, to
engage in the secu¬
business
under
the
firm
rities
of Robert E.
name
Warren Co.
i
With Mutual Fund Assoc*
as
much
during the prior
credit terms
were in¬
As during the last six months,
slightly larger receipts than they did
Re¬
heavy
merchandise
sales.
much of
year ago.
in
high
of record Christ¬
Deliveries appeared to
be more
prompt than in the pre¬
ceding weeks.
harvested
bakery flours remained
place
holiday
Board's
in
improvement
volume.
to remain at the
of previous weeks and
anticipation
mas
1,298,921,-
indicated consumption
The
ended Oct. 20,
official
reported at 5,716,000 bales, the largest for this period in nine
Consumption of cotton during the four-week September
\
was
The
corn crop,
period, as estimated by the New York Cotton Exchange Service
Bureau, was 790,000 bales, as against 744,000 in August, and
722,000
in September 1951. For the first
eight weeks of the current season
v
pre¬
was
Portland,
where
con¬
years.
000
current total was
16,548,000 kwh. below that of the
ceding week when output amounted to
7,697,880,000 kwh. It
531,874,000 kwh., or 7.4%, above the total
harvesting.
weather conditions
as
The volume of cotton ginned for the season
102.9%.
The amount of electric
energy distributed by the electric light
power industry for the week
ended Oct. 18, 1952, was esti¬
mated at
7,681,332,000 kwh., according to the Edison Electric In¬
stitute.
-v-v
for the year
liquidation in domestic cotton markets sent
prices
sharply lower this week. The decline was influenced
principally
by the larger than expected October crop estimate of the
Depart¬
ment of Agriculture, which showed an increase
of 524,000 bales
above the September estimate.
:
operating rate of steel companies
having 93% of the steelmaking
capacity for the entire industy will be at an
average of 106.6% of
capacity for the week beginning Oct.
20, 1952, equivalent to 2,214,060 tons of ingots and steel
for castings. In the week
starting Oct.
13, the rate was 106.5%
^(revised) of capacity and actual output
totaled 2,211,000 tons.
A month ago output stood
at 104%, or
2,160 000 tons, while a year
ago estimated output was
2,057,000
tons
and
for
Active
_
Electric Output Declined the Past
Week
low ground
new
ideal
Lard prices closed
demand from cash interests.
;n:-s;'Even-;>on:' somev>t©4th.e tightest products
(bars, steel plate,
galvanized sheets and; wire) there are
signs of improvement in
supply,
"St^el" concludes.;
V
|^
The American Iron and Steel
Institute
with the rate at
pound
show the
leading grain markets worked lower the past week
showing the greatest weakness. The yellow cereal de¬
cooler weather.
orders
that
per
to
73,113 bags on the latest
date.
This compared with 83,406 bags a week
earlier, and with
208,781 at this time a year ago. Coffee ruled steady in
quiet trad¬
ing but improvement in demand was expected with the advent of
plen¬
announced
is
the country. Cocoa developed a steadier undertone
and prices fin¬
ished moderately higher than a week
ago.
Warehouse stocks of
cocoa continued to decline
sharply, totaling
.
;
the price
ago.
before replacements became
necessary.
some
capacity increase, will not end steel shortages in one
swoop. They "yvill
disappear product by product and company by
company.
Already sqmerfinished steel products are more
less laden with
of
slow last week. Although prices were somewhat easier
buyers
appeared indifferent in the hope that values would work lower
This
are
total
its chief function
very
records
bringing new facilities into
this year production
capacity
of steel for ingots and
castings. On
109.3 million tons.
By next Jan. 1 it will be 115.6
tiful than others and some
companies
V, than others.
• : y
7 •:
sum
and
last year.
million tons, and some'time in
1953 it is to get up to 120 million
tons, this trade weekly-"points out.
—^
>
use
The total wheat crop for this year was estimated at
bushels, which compares with 987,474,000 bushels
000
million net tons
was
topcoats
The sharpest gains
in
Seattle
and
and
week, the
1-point increase
production
general
general
Interest
to
represents the
in
demand.
-
industry
and
for
under the influence of
the preceding
is its expansion
program which is
operation each week. On Jan. 1 of
now
Oct.
suits
orders
Although showing firmness at times, wheat prices weakened
large commercial stocks and lack of export
a
at 105.5%
week.
Enabling the
in
the
demand
Bradstreet wholesale food price index fell 6
$6.38 on Oct. 14. This was the lowest in five
released Oct. 13, indicated a yield of
3,256,550,000
bushels, up 71,303,000 bushels from the previous
estimate, and
comparing with 2,941,423,000 bushels produced last year.
balance in supply and demand is a
production pace that's
smashing records week after week.
Newest record is the
production of 2,200,000 net tons of steel
break
at
index
foods
corn
tinued
steel
over
year
with
industry fanned out geographically
office, the Defense Production Admin¬
istration and steel
company offices. All are making an
emergency
check-up of the situation, "Steel" declares.
and
stand
clined to
This alarm from the auto
to the Michigan Governor's
and
wide
moderately
&
Prices in
consumer.
ingots
In
to
commodity price level dropped quite sharply
last week following the mild
firming tendency noted in the pre¬
vious week. The daily wholesale
commodity price index compiled
by Dun & Bradstreet, Inc., fell to 287.01 on Oct.
14, from 290.70 a
week earlier.
The current figure is the lowest since
early Sep¬
tember 1950, and
compares with 304.90 on the corresponding date
The question still
unanswered is whether all steel consumers
be able to cash all of
their 1952 Controlled Materials Plan
steel tickets by the end of
this year or whether the
caught-up
position of the
auto-industry is a result of favoritism to it, the
for
Increas¬
women's suits
continued
course
or
The
will
that level
were
tailers
downward
Wholesale Commodity Price Index Reacts to Lowest
Level Since Early
September, 1950
Plan.
of
year earlier.
last
its
resumed
general trend of food prices at the wholesale level.
Some auto
Hastening the arrival
a
a year ago.
that
producers say they may even
try to borrow against
first-quarter allocations to
keep production roaring through De¬
cember, this trade magazine notes.
largest
to
The
of
by the end of this year it will have "cashed" all of
it 1952 "tickets"
for steel for its production
drive this year. "Tickets" are authori¬
zations the
slightly
moderately above
foodstuffs
43
than in the sim¬
more
higher than
>
level
since May 4 when it stood at $6.36. The low
point for
April 22, and the high was $6.70 touched on
Aug. 26 and Sept. 2. The current figure at $6.38
compares with
$6.77 on the like date a year ago, or a drop of 5.8%.
would
revelation
the Dun
as
months,
up/deliveries on November and December
backed up from the steelworkers' strike. But
automobile
sold
r The interest in
householdi goods
which has been
rising steadily in
recent weeks faltered last
week
but continued to be
ago
the year was $6.31 on
,
The government
needed to finish
be
Coast
l
week
a
45,
shoes, sportswear and child¬
clothing.
The interest in
men's
Wholesale Food Price Index Turns Sharply Lower
Steel
•
29
Pacific
continued
is being produced so fast the
government may have to
increase consumers* allotments of
it for the first quarter of the
coming year, says "Steel,'* the
weekly magazine of metalworking,
—
were
All
and 34 last year.
"
to Show
1951 total of 123.
from
to
promoted.
ren's
casualties, those with lia¬
to
to
coats, especially when strong¬
ly
and 165 which occurred in the
numbered 98,000, off 1,000 from
; August, the Bureau of Labor Statistics
reported. September was
the seventh
straight month in which starts were at or near
100,000.
<
Publicfhousing starts during the month totaled only
900, lowest
in over a year. In the first 9
months of 1952, work was
begun on
866,800 new dwellings, 800 above the like 1951
period.
+1
spurred by many price reductions,
comparable weeks of 1951 and 1950,
they fell sharply, 50%, from the prewar level of 277 in 1939.
Failures involving liabilities of
$5,000 or more rose a little
<:•*/.^.Housihiit'ftstarts/
SteelOutput Scheduled
ago.
preceding week, Dun & Bradstreet,
Inc., reports. While casualties were down
moderately from the 157
stemming
cor¬
than in the prior week
and
ilar week
and
Commercial and industrial failures
dipped to 139 in the week
more
the
Midwest and
4-3, Northwest
stores
ingly popular
and
ended Oct. 16 from 147 in the
black-market
a
year
44,
47.
noticeably
cars
43,
42
and
to
more
Business Failures Ease in Latest Week
The upsurge in the
money supply is due in part to better business
in many parts of the
country,
•
a
from
South
to
Apparel
cars
cars
and
—1
half
$1,157,000,000 to a new high
of $29,617,000,000. The
riseL-in retail sales
during the pre-Christmas weeks
may boost the total past $30 billion, bankers
predict.
.
0
to
Canadian plants turned out 4,997 cars and
2,291 trucks against
6,047 cars and 2,881 trucks in the prior week and
4,345 cars and
2,118 trucks in the like week of 1951.
million in
months ending Oct.
15, the total rose
89,685
24,662 trucks in the comparable period
varied
Southwest
Total
machinery, vehicles
at
England
East
104,391 cars compared with 99,974 (revised) cars
week, and 89,685 cars in the like weeK a year ago,
according to "Ward's Automotive Reports."
boost
Regional
estimates
responding levels of a year ago by
the
following percentages: New
It aggregated
in the previous
Security Program.
that substantial decreases
States
that
of
year ago than
large city department stores.
The total dollar volume of
retail
trade in the week was
estimated
by Dun & Bradstreet,
Inc., to be
from 1
to 5%
higher than the
comparable 1951 level.
Passenger car production in the United States last week rose
4% above the preceding week.
Chrysler Corp.'s return to full pro¬
duction following its 1953 model
changeover program was the main
reason for the increase.
Industry
a
did
Previous Week
•The State of Trade and
generally
favorable gains
more
the levels of
over
United States Auto
Output Rises 4% Above Level of
Continued jrom
page 5
stores
up
a year
before.
(Special
SAN
to
The
old Timewell
Fund
Financial
Chronicle)
,
j'
FRANCISCO, Calif.—Har¬
is
now
with Mutual
Associates, 127 Montgomery
Street.
30
(1546)
The Commercial and Financial Chronicle
With Clifford j. Murphy
(Special
to
The
Financial
OPEN-END
Mutual Funds
PORTLAND, Maine.—Ralph G.
Libby has become associated with
Clifford
25
Bond
104
Total net assets of 104 mutual funds reached
070,000
Dec.
NATIONAL
1952
A MUTUAL INVESTMENT FOND
Prospectus from
share
per
dealer
your
47
%
Stock
Common
Balanced
25
Bond
<fc
CORPORATION
Established 1930
120 Broadway
as
second
Bond
104
&
biaaafl
■
WELLINGTON
'■■■I
laaa
nil
illlll
■aaaaai
aaaaaal
quarter's
1.20%;
declined from 2.84%
and
a
higher than the others, declined to 2.29% from the
quarter's 2.43%; and from last year's 3.99%
pre¬
.
fund
repurchases
as
PHILADELPHIA
mon
2,
PA.
statistics,
over-all,
represent a normal
for the mutual funds business and
pared with the turn-over in other industries,
low rate.
^
Mutual
Funds'
1,
July
MUTUAL
Total
INVESTMENT
All
Funds
Common
Bond
as
Percent of
Total
&
Qtr.
Qtr.
Qtr.
Qtr.
1951
1951
1950
104
1.34%
1.42%
4th
1.45%
3rd
1.99%
2nd
2.75%
4th
1st
2.62%
3.92%
3rd
3.27%
Group Repurchases
47
1.22%
1.20%
as
1.18%
■
1.92%
2.77%
2.32%
1.17
1.10
1.24
1.76
1.59
1.93
1.82
1.44
2.43
2.80
3.34
3.99
5.56
9.20
7.09
5.30
IN
1st
4 th
3rd
2nd
1st
4 th
3rd
Qtr.
Qtr.
Qtr
Qtr.
Qtr.
Qtr.
Qtr.
eighteen
share
and
one-half
derived
from
income,
to
payable
shareholders
ber
1952
1951
1951
1951
1950
1950
1951
28%
25%
32%
50%
53%
59%
61%
53%
24.3
25
22
29
52
49
48
50
47
32
16.7
22
16
19
28
26
26
27
23
25
45.6
44
46
67
86
108
121
141
112
Specialty
NOTE
of
of
a
serious
de¬
highway
capacity,
during the war and
years,
the
October
issue
same
declared
thirty-two
share
profits
fiscal
30,
of
30,
1952,
record
Octo¬
meeting,
a
special
and
derived
realized
year,
also
the
Direc¬
dividend
one-half
from
during
payable
provide
October
1952, to shareholders of record'
October
normal
"Recent
we
estimates
assume
capita
of
will
mean
that
would
total
264
billion
K.
Bradford, President
look
for
a
the 3%
vehicle
FUND
it
continue,
in
or
way
available
spending
with less
still
are
made
continues:
"We
his
ap¬
don't
see
satisfactoiy to Rus¬
ADDRESS
749
travel
billion
miles,
above
the
or
1951
to
either
from
finance
from
an
road
current
increase
of
state debt.
"In the event of
recession fol-
of
Share¬
how to meet inflation
on
Observing
highway
got
four
that
that
the
have
price
influence
an
stocks."
of
will
the
of
income
the
in
they produce
future—not
greater
and
the
on
dividends,
of the Second
Man," he said.
HAROLD X. SCHREDER,
Execu¬
tive Vice-President of Distributors
Group,
and
guest
Sunday's program
Peabody
speaker
series,
radio
effect
to
decline.
could
the
Survey and President
Line Fund, advised
Value
investors
women
capital
family
of
as
a
protection
the
First
Mr.
Bernhard
look
"Second
a
upon
Man"
against
Man's
and
the
of
cause
recent
shortage
about
"Your
four
steel
strike
materials,
of
the
income.
Second Man,
recommended
(1)
million
mand.
should
we
of
future
income
as
year's sales," Mr. Schreder
"plus some carry-over de¬
Total production next year
5%
run
output.
widely diversified list of stocks
and
produced this year—300,-
Late
above
1953,
in
the
likely will see a return
competitive automobile mar¬
very
a
ket."
Mr.
a
Schreder
is
research
leading mutual fund
Moderator of the program
ton
Fox-Martin,
Peabody
tual Fund
head of
is Mil¬
Kidder,
and
Co.'s Central
Department.
Manhattan Bond Fund, Inc.
Diversified Investment Fund
ft
Diversified Common Stock Fund
A
PROSPECTUSES
the
spending on
travel encouraged by the existence
AVAILABLE
FROM
YOUR
ON
LOCAL
THESE
MUTUAL
INVESTMENT
adequate
highway
system."
FUNDS
DEALER,
Cleveland
Chicago
Los Angeles
Hugh w. long and company
San Francisco
BARRINGER, in
an
assessment of the probable effects
Incorporated
Westminster
at
Parker, Elizabeth
3,
New Jersey
head
sponsor.
Fundamental Investors, Inc.
f
1952
however,
consumer
more
only
automobiles
to this
said,
to
current
be
000 less than could be sold.
adequate life, accident and health
insurance
coverage;
(2)
invest¬
ment of earnings and. savings in
of
indirect
be
cm
in the Kidder,
dollar ad¬
more
the
premise they will go up in price.
as
soon
term
now
on
scale
be
He
advised buying stocks on the basis
beneficial
large
five billion
or
beneficial
a
dividends
upon
other
the
of
construction
expected
longer
of
to earn money
necessarily influenced by in¬
flation," he said, "but it is only
under
than
dition
to
our
annual
highway
spending could materially help to
replace some of the current spend¬
ing on plant and equipment which
is
increasing income, the price
go up.
But if it pays less in
dividends, the price will go down
as
a
rule even though the cost
of living may be increasing.1 A
will
labor."
of
effect
general nature
"A
stock
stock provides
a
an
"We can expect that the demand
for cars next year will be equal
and employ sub¬
amounts
D. MOREAU
a
the
before
Federation
ducers, the publication concludes,
per
would
If
every
highways.
be
delay
federal projects
stantial
for
can
miles
this
auto
1960
miles
difficult
revenues
made
Such
price goes up.
because
that
true
not
inflation,
recession, Mr. Arnold Bernhard, Editor of the Value Line
for
per annum
ing of an adequate highway sys¬
tem, it adds is the problem of
paying the cost. Individual states
construction
Minneapolis, Minnesota
Barringer
spending spreads
rather broadly to labor, material
suppliers and equipment pro¬
level."
find
STOCK
be
is
is
could and probably would
money
economic
population of 174 million people
by 1960," the publication states.
"If
rise
that
well
as
for
protection
against
lowing the leveling off of defense
recessions.
"There is no one ex¬
spending," the publication com¬
pert enough to select only one
ments,
"vast
sums
of
Federal
growth
The chief deterrent to the build¬
16,
H.
for
requirements.
cents
security
the past
yearly expenditure
for road construction is
necessary
to overcome the present
deficiency
increase
the
tors
per
October
per
dividend
16.
At
of
cents
net
of
for
To create and build
25.3%
47
in
will
loss
2nd
Qtr.
1952
Perspective, published b.y Cal¬
vin Bullock, states that a
doubling
dividend
in
there
and
AN
for
1952
104
Stock-
of the nation's
regular
already
was
17, 1952, to his directors. The
their
1, 1950 to September 30, 1952
3rd
of
a
tide
made
that
Qtr.
Funds
Funds
accumulated
declared
morning after Mr.
"It
out.
"Concentrate
of
Percent of Gross Sales
as
success
Investment
2.16%
0.98
2.29
by quarters
and
on
a
2.03%
2.84'%
32
ficiency
Inc.,
ago
and
25
TAKING
Fund,
'
stock that will be 100%
the take home pay
a
1952, the Directors
Companies
is
holders,
Mutual Fund Notes
Stock
345,214
241,069
Investment
company's ability
Group Assets
Percent of
Bond &
14,
of
Money at Work," stated that be¬
2.70%
Balanced
Investors
Chairman
years
1950
Fund
postwar
Fund
sia to keep one from reasonably
expecting its end, either in spread¬
ing war or increasing peace."
Qtr.
1951
Specialty-
Common
mar¬
present.
Assets
1951
1st
Mutual Funds' Repurchases
All
of
78,065
Association
the stock
on
four
is sufficiently
Qtr.
Fund Group:
On October
69,155
National
was anything more
geography lesson."
He
observed that many of the factors
1952
Qtr.
July
.
shares—not
omitted)-—
this change in the readable future.
We feel that the present sparring
1952
of
4
$221,171
befpre Korea
Percent of Assets
as
1952
Number
Consecutive Quarterly Dividend
$421,734
Oct.
Qtr.
Canadian fund.
of 29th
$130,372
that average—nearly half of them
given below.
Qtr.
Nome.
Notice
—7,117
praisal in his weekly letter, dated
1952
Stock—
Balanced
obligation please send
STOCK FUND
119,532
58,382
and the next four years
nearly 100 points added to
that
2nd
Fund
Address.
156,389
20,305
saw
notably
a
that
Women's
City_
$206,963
44,099
flood,
com¬
3rd
—
STREET
prospectus on
$108,756
$65,968
Exchange
Delaware
flationary
WALL
a
1st 9 Mos.'51
ket, makes the point that the pat¬ providing future income," he said.
tern of military expenditures •"*. "When you
buy a stock, you go
seems likely to be continued even
along with the company for better
if the Administration changes.
or
worse," Mr. Bernhard pointed
than
Group
me
$259,400'
1st 9 Mos.'52
17,834
Average to around 180. "And ,yet,"
Mr. Barringer continued, "the in¬
and
Funds in
no
of
000's
of the election
Mr.
1950 to September 30,
Repurchases
No. of
A
GENTLEMEN: At
$69,599 *
leeJection, the market
dropped the Dow-Jones Industrial
by quarters
l
$146,767
54,490
Source:
letter
Repurchases
A
JNEW YORK
Funds
Stock
(No.
dollars;
v
.
Statistics for the last two years are
Calvin Bullock
$49,765
Truman's
The third quarter and current annual rate of re¬
purchases as a percent of gross sales are 25.3%, for 104
funds, 24.3% for the common stock fund group, 16.7% for
the balanced fund group, and 45.6%, for the bond and
specialty group.
stable turn-over
ONE
108,167
Funds
the Wednesday
funds.
These
FUND
48,090
Specialty Funds—
York
Volume
43,701
15,635
$48,207
Total
New
34,587
$141,923
&
recalled
lower for the balanced
or
104
$107,532
$64,090
12,536
:'rd Qtr- 1952 2nd Qtr. 1952
Stock
Balanced
/..
1st 9 Mos.'51
$21,594
14,958
—
Common
The
percent of gross sales
a
moderately lower for the funds as a whole, markedly
funds, slightly lower for the com¬
stock funds, and higher for the bond and
specialty
were
investment dealer
$480,571
ago.
year
repurchases are now quite low at .98%;
compared with the previous quarter's 1.17% and last
year's 2*84%. Bond and specialty fund repurchases, while
Mutual
your
$568,501
fund
vious
prospectus from
$180,137
10,908
Total
Bond
repurchases as a percent of common
however, increased to 1.22% from the second
Balanced
$216,288
163,233
101,050
Specialty FundS—
25
Com¬
stock
190,976
106,472
$271,053
$87,562
$22,341
Net Sales
from the
stock fund
mon
fund assets,
■■■■■■■■■
1.34%
a year ago.
56,635
35,940
Funds
25
quarter of this year, total repurchases
quarter's 1.42% and from 2.75%
65,398
3rd Qtr. 1952 2nd Qtr. 1952 1st 9 Mos.'52
Stock
Balanced
47
percent of total assets declined to
a
t
New York 5, N. Y.
•
$3,045,707
1st 9 Mos.'Sl
32,792
$91,940
—
Funds
Common
32
32
RESEARCH
Funds
Funds
47
were
For the third
900,210.
601.937
Qtr. 1953 2nd Qtr. 1953 1st 9 Mos.'53
Specialty Funds—
Repurchases
$568,501,000, while net sales, after
statistics.
or
NATIONAL SECURITIES &
$3,129,629
't/srd
'
Total
104
shares for the first nine months
new
$3,510,593
$1,543,560
$190,130
32
$421,734,000.
Gross and net sales for
the same period last year were $480,571,000 and $221,171,000, respectively, according to the National Association
of Investment Companies, the agency which compiles these
redemptions
Approximately $6.02
of
amounted to
644,198
942,087
596,027
Total
Sales
31, 1951 and
Total sales
of
.$1,591,515
1,070.427
Funds
Specialty Funds—
30, 1951.
STOCK SERIES
$1,795,968
•
$3,596,-
Sept. 30, 1952, an increase of $466,441,000 over
an increase of $550,363,000 since Sept.
on
&
Sept. 30,'51
Dec. 31,'51
June SO, '52
$3,596,070
Balanced
$1,832,546
»653,147
uuas
l
32
Sept. SO,'53
1,110,377
47 Lu«uuvli
Total Net Assets of Mutual Funds Now at $3.6 Billion
•
*
(000's omitted)
>
Total Net Assets
By ROBERT R. RICH
Co.
STATISTICS
COMPANY
ending September 30, 1952
104 Open-End Funds
J.
Murphy Co., 443 Con¬
gress Street.
Mr. Libby was for¬
merly
with
Clayton
Securities
Corporation and J. Arthur Warner
&
INVESTMENT
For 'the quarter
Chronicle)
1952
Thursday, October 23,
.
.
.
OR
Mu¬
Volume 176
Number 5162
.
.
The Commercial and
Financial Chronicle
.
(1547)
APPOINTMENT
Haynie,
Charles
of
former
chief
W.
ment
statistician
Call
and financial analyst for the Shell
Oil
Company,
Survey. •"Prior
connection,
to
senior analyst in
was
several
Dun
Mc-
Hayes
Mr.
associated for
his
the
firms
and
Smith, Barney & Co. He
vestment
also
research
for-.-Investors
-
for
two
Diversified Services, Inc., of Min¬
tor
of
neapolis.
and
has
H-.
V.
manger of
investment
A
announced, here by
was
Flett,
department.:,
native k of
graduate
technic
the
of
\
cles
utility mangement for
Webster,
Inc., in
Stone
Magazine"
author of
in
arti¬
financial
the direct
loans,
and
assets
Corporation
and
$23.94
Subse-
of
were
equivalent
whether
made
to
quently he
•
carpet
with
•
in
•
the
affiliated with the
was
textile
and
War
Production
Washington
before
New
r-
v
He
is
Board
So-
corporation/ Investment assets
Island,
civic
L.
resident
a
Long
active in
was
as
N,
of
BARR,
treasurer
in
;
former
charge
mcuth
months
College, has joined Inves-
Diversified
Investors
of three
Mutual; Inc., largest
mutual funds distributed
and
addition to his responsibili-
ties fcr management of the Dart-
report,
close
for
the
past
served
15
as
5,337
Tuck
special
lecturer
School
of
128,100
stock
engaged
with
in
Dick
the
of
of
to
assuming
hold¬
Rutgers, which
This
company.
acquired
1930's> with
toward
rebuilding
position
and
in¬
in
long
a
duties
the
range
the
fi¬
insurance
these major objectives have
years
been achieved and the
sale of TriTHE
HAVANA
Stock
Continental's
Exchange
holding,
'
honored
the
visiting
according
to the
American
economist, Dr. Max Winkler, who
„
•
report, brings in insurance
interests that should contribute to
presided
the
continued
and
Rutgers.
the
•
•
Winkler
r
•
introduced
was
investment
Granda
progress
and
Exchange
in
an
address
members,
them
for
he
the
corded him and at the
stressed
Cuban
Dr.
the cordial
to
the
the
formally
honor
same
from
is
has
that
been
the
made
Proceeds
vested in the securities of
list
which he is
WILLIAM
-
sistant
Call's
-
a
Corporation
for
Director
of
Magazine,
Research, Mchas
joined
the
editorial and research department
of
Arnold
lishers
of
Oil
,
stocks
the Value
&
Co., pub¬
Line
Invest-
continued
Continental's largest
on
Sept, 30,
22.7%
of
held.
Bernhard
broad
a
companies with the result
that
the
Corporation's portfolio
has been further
diversified.
consulting economist.
HAYES, formerly As-
of
and
being rein¬
are
ties
Research
con¬
Globe
in the interest of National Securi¬
&
a
well-known
the
of
of
portfolio
of
Rutgers holdings
visiting Havana
toward
again
the
made
total
common
value
utility
the
up
industry
totaling
represent
amounting to
Public
est
to
and
with
groups
spectively. The
common
and
or
largest increase
in
in
from
$651,375
the
During
of
new
and
to
the
8,000
shares
auto
single
of
third
into
quarter
of
General
names
industry
Motors
the
the
Chrysler
purchase
and
8,000
introduced
common
stock
two
portion
of the portfolio.
Additional new names were
Commonwealth
Water
ers,
Theatres
creases
Can,
Prospectus describing Company and terms of offer¬
ing may be obtained from Investment Dealers or
2500 Russ
Building, San Francisco 4, California
Walker
were
in
United
eliminated.
holdings
Pacific
and
Gas
were
and
Electric,
in
in¬
American
West
Ken-
Lucky Coal, du Pont,
Westinghouse Electric,
Southern Company,
ican
were
H.
L.
Natural
made
in
Gas.
Scott Paper and Amer¬
Principal
Houston
Oil.
seem
Qreen and McCrory Stores.
Oil,
sible
15%
determination
monetary
in-
to
of
policy
of
it
as
debt
sufficient
need
this
the
future
for
addi¬
and
although it will
default, and make the
satisfactory
arrangements
be in
never
most
possibj£ in the
public interest to
carry" it.
the
I
years,
have
advo¬
cated
the
12
Federal
Reserve
Banks carrying a
large part of this
debt and save the
people the in¬
terest charges.
I
to
the Nation. The stronger the men
appointed to the Board of Gov-
their
into
have
will
we
credit
Over
maintain
with
to
would
we
back
go
for
their
more, we should reconcile
ourselves to the fact that this
debt
will not be
paid,
over-all
related
to
do
paid
even
gov-
to
is
the
firmly
believe
quite
competi-
J100?1 Programs determined
Reserve System
inflationary loans in spite of
central
half
of
bank
the
(and in
the
policies.
banks
in
the
In
localities possibly all
banks) free from or little
by
Federal
action
to
sibilities and the equally
efforts of
hardly be effective. System to
duties
their
the
Federal
out
carry
have
agencies
the
its
seemed
sincere
Reserve
Without
tionate share the banks with lower
and variable reserve
requirements
have
contributed,
no
one
can
say.
But their exemption from
uniform
inflationary loan
pansion
extent,
against
was
interest. If
we
the
upon
the
to
are
ex-
national
were
that
ural
may
number of
surface! A
suggestions have been made for
the creation of consultative or ad-
rely, to
any
visory councils which would help
democratic
de-
to coordinate the
government's
economic policies into a meaning-
vices for
general credit
rather than
specific
control
price, credit, ful whole. The details of how just
and rationing
controls, we must such a council would work are not
take the steps
necessary to set up nearly as important, it seems to
institutions
may
accept the national debt
manent
fixture
as
necessary,
conflicting views
come to the
a better
way is found to provide
the necessary media of
exchange,
it is my recommendation that we
some
When two agencies, each
having
separate functions, have to face
up to any issue, it is not unnat-
reserve
standards has left them
free to seek profits
by expanding
loans when
differences
na¬
there is no way we can
stop
Congress from further using this
easy way, which is so painless, in
providing money. Therefore, until
bring the
conflict.
in
stop at the
But
statutory
to
in
measure over-dramatized,
propor-
way
Congress
debt and there would be
mistake about it, then we could
safely have the Federal Reserve
Banks
carry
the national debt.
brushing the importance of these
We have had,
regrettably, too occasions aside, I think it is only
much, inflation
in
recent
years. fair to say that much of the soBank credit expansion
has
uncalled "clash" has been built up
doubtedly-contributed to it. How in the minds of outsiders and that
than
easy
no
Inflation
more
right point this
getting money. 1 If
tional
when the sinefforts of the Treasury Department to carry out its respon-
Credit Expansion Induces
much:
the
of
could be forced to
cere
regulate the supply of money, national monetary
policy to control
can
at
connection, it must be
that in the past there
have been occasions
affected
inflation
this
admitted
country
should not trust Congress—all the
upon
Congress and administered Members being elected "by the
people on popular issues—to stop
e Executive Branch,
^
With
some
in
expanded
economy
the
as
a
per¬
absolutely
interest
and
of
our
our
ex¬
panding economy and go about ar¬
riving at the best solution of how
it should be carried in the future.
It must
one
be
never
penny of
nor
interest
that
can
be
repudiated—not
it; neither principal
and
—
paid
on
amounts
any
it at any time
should be paid.
In summary,
it seems to me that
important issues which I want
the
to
point
with
up
today
you
run
somewhat as follows.
First, the
determination of mohetary policy
that our policies me> as that the agencies involved
effectively to the work together in a healthy spirit is of the utmost importance to the
economy and of cooperation and mutual respect, stability of the economy. As you
the control of in- 1 wish it were possible that per¬ will recall, the founders of our
so
contribute
stabilization
esnecially
of
to
the
flation.
feet
coordination
of
fiscal
and
Constitution
recognized
this
and
Next to the policies
the machinery for the
themselves, monetary policy could be further placed squarely in the Congress
determina- facilitated and assured by the sim- the power and responsibility for
tion
of
monetary
policy is, of Ple expedient of some added bit coining money and regulating the
course, of the utmost importance. of machinery, but I do not regard value thereof. It is not necessary
When
our
Subcommittee
an[t as necessarily an evil when, in to remind this audience of the
nounced
its
problem
of
plans to
into this
go
policy determination,
there
were
many
people
who,
without
foundation, jumped to the
conclusion that the traditional
of
the
Federal
was
being
believe that the
threatof
course
Committee's hearings and the
Committee's report have now put
such
fears
Wbat
the
completely
Committee
determine
how
was
at
rest,
sought
best
the
to
in-
dependence of the Reserve
System
might be perserved and built up
within
and
not
from
the
a
New
which
York
made in
a
Mr.
take.
Second,
I
the
of
Governors.
Our
more
or
national
it per-
public
less
as
a
the
money
on
much
debt
this has meant chiefly the mini¬
mizing of inflationary pressures—
monetary and credit policy offers
one
of
made
in
a
detailed
useful
most
our
tools.
Finally,
and
it
is
ef¬
in¬
cumbent upon the government as
a
as
we
hope
that
$258
bil-
abhor debts,
constantly to im¬
the facilities by which mon¬
policy
consequence,
made
are
most
of
the
pay
part
mately
and the Na-
infiuentially
involved
system
ments
determined
That
should
of all of those who
structure of the
form
be
may
effective.
be the purpose
Although
raised could be used to
a
prove
and
of
major problem.
the National debt
have
of
and bank deposits.
looking toward the ob¬
jective of maintaining economic
stability—over the last few ypars
fective
com-
I have consistently voted for taxes
never
number
of credit
of
Reserve
essentially
simply
form
etary
important functions which
are
the
National DebL
lion,
character; the Committee
is
of
the Board
sense that no public or semipublic agency be allowed to run
along without any audit or review,
In the. interests of
strengthening this independence of the Systern
while
recognizing that the
forms
It
or
with
nor
auditing
mon
in
Federal
Governors,
appropriate
is not
Committee.
in detail with
on
accounts of the banks
Sproul of the
our
go
the Board of
govern-
Strengthening Independence
the
shall not
discussion
of the problems of
the annual expenditure budgets of
a
Reserve Bank
Federal
letter to
our
supply of money today takes the
ment, if I may emphasize the distinction
democracy, solutions have to be overwhelming extent to which
worked out by sweat and toil and
involve a great deal of give-and-
in-
Re-
the
reductions
Seaboard
Since
non-
drives member banks to
the
Paramount
Substantial
made
other
have
tional
to place
ernmental administrative heads,
the
and
Washington
Holdings of National Distill-,
Power.
Hiram
Edison
and
would
money.
economic and fiscal needs of
But
Federal
I
$1,867,000.
shares
make
ened.
a
accessory
the
even
larg¬
industry category during the third
quarter
was a
build-up of the corporation's invest¬
ment
with
and
System
re¬
Cabinet members
we
everybody
again in order
salaries of
that
if
ernors, the more likely they are that the 12 Federal Reserve Bafli&S
*° arnve at sound independent could carry all the national debt
tive advantage enjoyed
by non- Judgments. Surely no one would and save $6 billion a year inter¬
members
tends
constantly
to ar§ue that these judgments should est charges, but I am not advo¬
weaken the incentive to
go along ~!e ^ree t° run counter to the nacating it. I am convinced that we
dependence
investments
the
neighbors
serve
$10,576,125,
inated; and (4) that the
cut-
of
just
that the pres-
ent geographical and other
qualifications for appointment be elim-
Board members be raised
get them more in line with
what
debts, he replied that
substan-
necessity
banks
stocks
third
(3)
that
and
position
stocks
chemical
second
$22,400,125
holding
$28,924,855,
of
and
stock
Tri-
of
would
non-member
our
securities.
sale
further
objective
primarily
marketable
United States
relations.
Winkler
working out of this
means
Corporation's
sisting
Globe
Tri-Continental,
simple investment
ac-
time
of
progress
For
the profitable
by
Havana Stock Exchange President
thanked
.
the day's session of
Exchange.
Dr.
,
over
member
con¬
business of the
company. Over the
Dartmouth.
management
of
sale
represented
view
Company in New York, prior
the
(2)
holding
expense
desire
understanable.
of
This
complete
early
and
nancial
at
had
vestment ,.was
field
Rutgers
Company.
and
that
common
and
involved
He was
Merle-Smith
of
the" Globe
previously
previously with L. F. Rothschild
and
shares
ing in Globe
Busi¬
investment
and
the
quarter,; sold
The
competitive
were
$5* /.cumulative
Insurance
trol
Richmond Hill, L. I.
ness,
of
Tri-Continental's
investment management at the
college's
third
all deposits
for
}
shares
Barr
'
on
the
tially reduced;
effect
supporting the first Price Con¬
Bill, September, 1941, when
asked
banking system.
significance
$155,-
Sept. 30;: 1951
five;
of
far greater than their modest
beginning of the
7
the
at
than
more
burden
in
paid,
testifying before the Banking and
Currency Committee of the House
in
money
not
their terms of office be
eco-
based
debt will
prooably
If all debts
were
trol
be
banks
15%
In order to in-
can
case
is
this
would not have
money and
credit to
carry on the business of
the
country. In other words, like
Leon Henderson said
when he was
to
too,
31
additional
we
The objective which we had in
mind, and indeed the only posmember banks to the effectiveness sible result of this
type of reform,
of national monetary controls is would be to assure the best
posThe
dicate;
totaled
doubt,
in any event a
or
ride
today.
Tri-Continental* ynear.
transaction
Mr
years,
a
on
of
Fire
mouth trust and endowment funds
also
released
According to the .nine
..n^onths
and
In
rate
are
convertible second
preferred stock
and managed by I.D.S.
;
the
$150,727,348.
Services, Inc., to
assist in the portfolio
management
of
at
of
'
tors
-T952,
Investment, assets
year
free ride
of
of
130,269
remaining
remainder of the
the Cor¬
" this
monetary system
that
ommended (1) that the number of
members of the Board be reduced
discount
maintain
deposits while
a
poration's report for the first nine
Y.,
affairs.
$161,725,348 in
needs
upon debt.
the selection of
persons of
the highest caliber as members of
the Board of Governors, we rec-
operations
the
to
Our
sion
sure
stability upon the shoulders
banks holding about 85%
of
of
earlier,
stated at
and
placing
efforts
the
Chairman of the Board and
President of this closed-end
investment
-
investment management for Dart-
;
year
for
I
good
very
the
of
the
of
•
-
a
ciety and the American Statistical
assistant
•
compared
beginning
Association
DONALD
;
as
the
according to Francis F. Randolph,
York Security Analysts
Douglaston,
.
1952
at
joining
member
a
30,
$22.17
the year and
$20.85
'
Shell.
Sept.
with
industries-and
.economy
recommendations.
nomic
•
on
open market
a
national
stock
common
levels,
reserve
utterly useless.
are
Tri-Contential
share of
per
rationing and control of
imagine there are few
rates, and
TRI-CONTINENTAL
Net
I
through
NEWS
(1
Permanent Fixture"
as a
bankers who would want to
argue
that
general
credit controls
;
CLOSED-END
public
Boston.
Debt
a
Institute, Mr." Haynie be¬
in
the
"
•
Accept the National
was
Associate Edi¬
Bankers
been
"We Must
Bradstreet
magazines.
Alabama } Poly¬
career
&
years
"The
appearing
trade
v;.
Alabama.: and -
his business
gan
the I.D.S.
of
from page 11
credit.
with
years
charge of petroleum industry in¬
as
Continued
in
the
country.
of
reserve
and
inti¬
financial
If
a
uni¬
require¬
will work toward that
end,
.
T
tional
finally
debt
come
to the definite conclu-
be paid.
statement,
but
that 'anyone
by it.
liquidated,
This is
I
do
should
startling
a
not
be
believe
disturbed
The fact is, our expanded
if
minor
in
the
structural
Reserve
requirements
System
will
con¬
tribute in any measure to that end,
they
arejicertainly all worthy of
examination
and
cfiirlxr
adoption
after
32
The Commercial and Financial
Chronicle
(1548)
Continued from
first
page
.
Thursday, October 23, 1952
.
.
during June, July and early
August in 1929 and as a result
sey
there
Outlook lor the Stock
A
arket Is Bearish
Supreme Court
to Review Western Pacific Case;
Rail Market Aided!
Last
week
discussed
Western
menting
the
on
interest
this
in
that
of
we
com¬
been
Rock
review
lower
litigation
decisions
court
with
the
old
in
holding
company over certain tax benefits
amounting to $10,100,000.
further
that
noted
It
was
number
a
of
railroad analysts viewed the sharp
advance in price of the stock on
such
any
premise
Last week the
hand
down
cision
was
premature.
as
Supreme Court did
its
decision.'The
de¬
to review the case, not
to refuse certiorari
had been
as
widely anticipated.
As
so
result,
a
and aggravated by general market
uneasiness,
sharply.
the
feoing
broke
stock
Supreme Court is
to review the
there will
case
obviously be further extended de¬
lays. In the interim
there
is
preferred
be
can
quotations for the
shares.
is
now
The
price of the
nearly in line
more
the
around
of next month. The
Close
of
students
middle
present regu¬
lar rate is $4.00 a share
lean
final
the
on
also
annually.
this
situation
the
to
opinion that if any
liberalization is coming it will be
in
the
nature
bution
rather
of
than
conservative
in
is pointed out
that Rock Island has
finances
increase
an
the regular rate. It
distri¬
extra
an
extremely
an
capital structure, its
in
are
shape,
good
and
that property needs are not heavy
following
the
comprehensive
habilitation program.
with prices for other similar
qual¬
Thus, it is
felt that considerably more than
$4.00 could well be distributed out
anticipated earnings this year
between $14.00
and $15.00 a
of
share.
Last
earned
$8.44
the
year
a
company
share.
common
ket
early
last
week
again
was
checked by a resumption of
buy¬
ing in the better grade railroad
shares. As a matter of
fact,
throughout
the
decline
railroad
stocks had acted better than other
sections of the list, a fact that was
not surprising to close followers
of
the
industry.
of
cause
the
The
immediate
renewed
buying in¬
terest
in this group was the re¬
lease of additional
good dividend
news.
a
Atlantic Coast Line declared
year-end
extra
of
$1.00
while
maintaining the regular $5.00
an¬
nual rate. On the same
day Louis¬
ville & Nashville declared an
extra
of $0.50 a share while
the
regular
A. G. Beane Pres. of
annual
While neither action
in
generous
the
and prospective
inspire
up
notably
of
current
earnings, they did
renewed
pointing
was
light
rate.
bullishness
in
broad trend within
a
the. industry toward
Commodity Research
Alpheus C. Beane,
of
seems
more
the
news
probable
1952
has
as
that
partner and
a
favorable
this connection there
panies
dividend
whose
are
two
com¬
St.
&
and
flock Island & Pacific.
agement
some
of
time
Nickel
new
The
been
on
for
record
bank
loans,
have
However, next
been
year
in
1954
these requirements decline
sharp¬
ly. Presumably, then, it should be
possible to pass along to
stockholders
tion
of
an
common
increasing
reported
net
propor¬
income.
is expected that
the first step in this direction
may
well be taken at the
November
meeting
the
Board.
At
that
time the dividend to be
paid Jan.
earlier
forecasts
1951
of
revise
of
per¬
dov/nward
advance
an
300 level
substantially above the
the
statement
recent
Other
President
ton,
Stock
the
of
Exchange,
the
the
Beane
in
M. R. Herrick, Man¬
Commodity
Depart¬
Fenner
&
Beane,
The following were
electqft as
Club Directors: C. R. Berg, Secre¬
the
New
Eliot
York
S.
net
gain
Produce
gain
Financial
in
Financial
GREENVILLE,
N.
Chronicle)
C.
—
Robert
the
of
corded
Financial
has
Waddell &
joined
Reed, Inc.
the
staff
preceding
change in the pricerelationship in trading
is extremely important to
keep in mind in connection with
stock
the
and
breadth
ranges
present
situation, the change
price-breadth performance
during bull markets has been even
in
the
spectacular.
more
the
wartime
dustrial
bull
In the
course
market
11
sound
a
74. In
which
74Vz to
as
never
before
in its previous
history to compile a record of 122
points gained while the industrial
average had to settle for a total
that
two
was
points less than the
advance in breadth.
in
the
Market
technical
record
since
1946
three
fol¬
the
weeks
actively
between
67
week, how¬
forward
again,
carried
it
from
a
low
of
high of 80%. Four trad¬
ing days later it reached its 1929
high at 83.
a
in
episode
the
of Standard Oil
sey)
involving
3,946,000 shares
weeks
turnover
a
of
(which
market
(N,ew Jer¬
of
in
six
stock
compares
with a
the
total
of
year
1951) illustrates how pro¬
manipulative operations
call public speculative at¬
1,565,000
shares
for
fessional
could
tention
to
conyert
a
a
neglected stock and
quiet horizontal trading
into
range
It
vance.
sized
roaring dynamic ad¬
a
cannot
that
be
over-empha¬
"public psy¬
so-called
far
as
did
Jersey
as
not
"change
was
over¬
night."
Public
psychology
was
changed overnight as the result
of a dynamic manipulative opera¬
has provided further confirmation
tion.
for
Jersey had shaken off its lethargy
and was going some place, thou¬
sands
of
public speculators and
the
conclusion
Federal
that
regulation
the
under
breadth
index must lead the price trend in
bull markets as well as in bear
markets.
The
reason
for
the
Once
investors
the stock
to
regulation professional speculative
operations tended to concentrate
sive professional
on
relatively few active pivotal
such
as
normally would
be used in a representative stock
average.
Under this system the
a
stocks
which
a
was
breadth
weighted down
far larger number of lower
sudden
a
and
in¬
rushed
in
With the elimination of aggres¬
ations,
sustained
speculative oper¬
major advances
in the stock market
are
now
com¬
pletely dependent upon the rela¬
tively
slow
development
of
a
broad public speculative demand
wartime
index
the
that
it.
buy
for
from
obvious
was
developed
in
terest
it
change in bull markets to leader¬
ship by breadth is that prior to
sational fashion
year.
pre¬
the
the fourth
chology"
Speculation
the
for
ever,
it
surged
greatly assisted by a 423,000 share
session, Wednesday, September 11,
in¬
technical
next
traded
Dow-Jones industrials during bull
markets ran away in rather sen¬
Era
index
of
12
reactions
mar¬
re¬
points while
a
loss
the result
was
February, March
the early part of
which the breadth in¬
brief periods of concen¬
on
in
trated
in
and
bull
average
showed
points. This
May
months
selling
lost
more
ground
than it could make up on
the ral¬
where the
lies
roared
up
industrial
average
at the rate of 20 to 25
points for each point of advance
breadth.
.
regulation
tightened
was
to
1938
approximately
the
throttling point mentioned by Mr.
Funston, the relationship between
the
breadth index
and
the indus¬
trial
average
has been revolu¬
tionized.
Protracted
periods
of
now
in
trend
breadth
accompanied
the
ence
of
that
narrow
by
average.
past
15
major
Experi¬
years
trading
are
between the regulated market and
the
old
free
market
is
to
be
stocks being added to
demand. The
common
normal
investment
bull market
proved that
speculators, was not
interested in buying high-priced,
high quality stocks on high mar¬
gins. Instead, public speculation
as it evolved rather slowly in late
the
public,
as
diate swing in the eight-year New
market that climaxed in the
Era
in
but
with
tendency
a
secondary
stocks
than
in
average.
In
the
two
the
up
the
com¬
1929.
that
this
was
public
expanding
in
late in the final and
biggest inter¬
was
outlook for the stock
range
sustained advance in low-priced
in the breadth index.
stocks and
Expectation of Climactic Blow-Off
In Low-Priced
mediate swing of the biggest bull
market in
history.
tion apparently
Jersey
from
was completely neglected
May 28, when it sold at 56,
to
August 10 when it was still
56, despite an advance of nearly
50 points in the industrial average.
The greatest
thus had no
In
With specula¬
raging all around,
oil stock in the world
appeal to the great
speculative public dur¬
and one-half months of
bull
market
was
concerned
well have
as
trading range of less
points. As far as Jersey
has
been
been
it
might
in
a
on
just
market
display
as
such
during
has
been
completed, lowspeculative shares would
priced
was
more active partici¬
final big, climactic
blow-off
ending the major ad¬
vance. This expectation of a final
blow-off in cats and dogs is one
in
pants
the
of
Between May 28 and August 10
1929 Jersey was held within a
it
become much
stock
in
Stocks
generally expected that before the
ing two
the greatest speculative orgy ever
months
recent
American
recorded.
mar¬
it is possible to project
ket unless
a
The amazing fact about Jersey's
1929 fling
was
that it came so
lasting from two to four horizontal
have been accompanied by than four
higher grade issues making
D-J
of
summer
shows
ranges
It
speculation
low-priced stocks
primarily responsible for
the dramatic change in the bull
of
old-fashioned
manipulative market performance of the breadth
operations is to review the market index. The record of the past 15
career
of
Standard
Oil
(New years provides no justification for
Jersey) during the final interme¬ being optimistic about the long-
thoroughly understood. A good
way to emphasize the importance
breadth
toward greater weakness in many
of
the
index
restricted horizontal ranges in the
M.
For
120
the
advanced
average
of
about
of
average
daily
lowing Friday 244,000 shares were
traded
and
Jersey on that day
ranged between 63%
and
70%.
range
eight
gain of 81
a
average,
Chronicle)
LOUIS, Mo.—Elizabeth
final
industrial
breadth
the
years
With Waddell & Reed
Williams
the
reaction
five-point
a
advances in the
Chronicle)
Blyth & Co., Inc., Pacific Building.
The
than
more
great New
the
ket,
not
PORTLAND, Oreg. — John M.
Shank has become affiliated with
to
the
While this
with
horizontal
Blyth Adds To Staff
Financial
in
was
Since
Fourth Street.
(Special
a
breadth.
in
W. Fennell has become connected
with
Courts
&
Co.,
115
West
The
breadth
technical
a
During the
Joins Courts Staff
to
ceding three months. On
than
four years.
or
December
breadth
in
The
ing levels
an
beginning of July to the
the net gain in quality, less glamorous issues.
four points as com¬
The importance of the profes¬
pared
with an advance of 98 sional speculator in keeping the
points
in the
average.
During market moving in fairly well-de¬ 1942 and early 1943 tended to
these
six
months
the
average fined trends by concentrating at¬ concentrate on lower-priced,
showed a gain of more than 24 tention on important pivotal stocks lower-quality stocks bought out¬
points for each point of advance cannot be ignored if the difference right.
of
end
dex
Chronicle)
White has become connected with
(Special
in
by
1928, the breadth
within
August
RACINE, Wis.—Mrs. Dorothy C.
to
in
advanced
June,
and
Marshall Co. Adds
(Special
to
points
of six
152
accompanied
was
of
partner of Irving Weis & Co.
The
shares
4
From the
of
to
from
during the final half of the
Golde,
ViceGeneral Cocoa Co.;
Leon Israel, Jr., President of Leon
Israel
&
Bros., Inc.; J. Turner
Jones, President of Turner Jones
& Co., and
Irving Weis, senior
(Special
with
15,000
Free
horizontal
narrow
advanced
point
held
Lynch, Pierce,
Secretary.
of
in
Following
C.
with
carried the average to lower clos¬
Relationship
spent most
its earnings.(around
pared
by Regulation
points.
as
President
markets.
discovered
group
that
Professional
bull markets
time
A
each
ment
of Dean Witter & Co., as
Treasurer; and E. A. Beveridge,
Commodity Economist of Merrill
tary
throttling
are
6'8-point advance in the average
a
period of 17 months. For
officers
were:
York
excessive
over
A.
declines
move
concerned
breadth
was
of
ager
Funs-
New
that
securities
nation's
220.
Vice-
elected
intermediate
why
Keith
of
a
were entitled
price-earnings ratios en¬
by
chemical stocks. The
started Monday, August 12
60,COO shares traded, com¬
joyed
This
industrials
President.
displayed rela¬
tively more weakness than in the
earlier years and ended with sus¬
three
Jersey
for the year)
career
supplying
reason
for
1929
the
to
this four-year bull market that it
average
Co.,
elected
then
company and
$4.70
me
for
good
a
to
trading ranges. Between January,
1927 and May, 1928 it held within
a
six-point, range while the D-J
Depar t-
And
the became obvious that Federal regu¬
lation of the securities markets
regulated
market
should
not
had revolutionized the relationship
ordinarily be expected to value
between breadth and price. In¬
common
stocks as generously as
did the old-fashioned free market. stead of reflecting the existence
grateful
index
breadth
with
feel
I
Rating
In
points, from 92 in April 1942 to
212 in May 1946.
It was during
Also
ment of Bache
&
the indus¬
during the last year
of restricted
range
tained
Chemical
the
D-J industrials.
for the
of
Commod¬
ity
hori¬
protracted
trading ranges,
average
The
Manager of
ST.
of
spring
to
Prior to regulation, the breadth
In
many quarters it
the
me
index in
heavy.
and
in
Price-Breadth
to
stockholders that dividend policies
would be dictated
by cash needs.
These cash
needs, particularly for
equipment maturities and serial
dex
grateful
very
suaded
Revolutionized
man¬
has
higher-
of the breadth in¬
the action
the
as
Chicago,
Plate
that
President
elected
directors'
Louis,
feel
I
connection
the
of
meetings The Marshall Company of Mil¬
are being awaited with
particular waukee. Mrs. White was previ¬
interest. They are New York, Chi¬ ously with Ver Meulen & Co.
cago
of
number
a
sion
Fenner
all
yet been released. In
and
grade investment issues have not
done anywhere near as well as
the D-J industrial average. In this
Federal regulations
Commodity Divi¬
Merrill
Lynch, Pierce,
& Beane,
yesterday was
liberal
not
highs
Director of the
treatment of stockholders.
It
forecasting. The vast ma¬
jority of lower-quality stocks are
substantially
below
their
1951
range
statistical evidence to support the
maintaining Exchange;
$4.00
job of long-
zontal
trial
speculative
public
no
that Jersey was really a chemical
of
cases
position by
Furthermore, drastic changes in
price-breadth relationships during maintaining a restricted horizontal
the past 25 years supply definite base, the breadth index took off
,
mar¬
1951, I feel that the breadth
pleted
of
ity railroad equities. Even though
of
the
Com¬
prospects for any increase in the
modity Club
$3.00 annual dividend rate now
of New York,
appear
remote, railroad analysts
Inc.
He
sucgenerally are again casting a fa¬
c e e d s
J.
A.
voring eye at the common on the
basis of the long-term prospects of Higgons, Jr.
Sydney
A.
this fundamentally sound railroad.
T e s s 1 e r
a
The general weakness that over¬
partner and
took all sections of the stock
at the record since the first quar¬
index has done a good
re¬
worked
change in prospect, how¬
has presumably been pretty
thoroughly discounted in the re¬
common
decide
dividend
1952
ever,
stock
directors' will
Island
presumably
out. This
cent decline in
an¬
ap¬
parently little hope that the antic¬
ipated refunding of the partici¬
pating
share
a
ter cf
of
Now that the
on.
nually.
opinion refusing to
an
present rate is $2.00
buying
by hopes and expectations that the
Supreme Court would very shortly
hand down
be decided
1953 will
2,
generated
wave
had
by Good Dividend News
column
Pacific,
and in August it exceeded
previous highs by three or four
The points. Each time, however, the
market ran into trouble. Looking
top
was
interest in this leading oil stock.
a
mass
delusions
market
that
about
the
be
ex¬
cannot
orcised.
In the present situation,
following past precedent, the final
big, climactic blow-off in low-
priced
stocks
advance
D-J
As
of
took
the
place
final
well
high in
in
the
average.
a
matter of fact the
climac¬
tic blow-off in all kinds of stocks
really occurred in 1951.
The
pro¬
the 9.3% trading range of the past
15 months. There was no profes¬
gressive decline in trading activ¬
ity accompanying new highs since
sional speculative interest in Jer¬
January,
1951
has
been
so
em-
Volume 176
Number 5162
.
.
The Commercial and Financial
Chronicle
.
(1549)
phatic it is impossible to believe
variety, struck him as being wage rates. Six
years after World
extremely unlikely. This agree¬ War I wholesale
prices had re¬
that a speculative climax has not
already taken place.
Volume
1951
of
ment
by Mr. Turner with the vir¬ ceded to
tually unanimous belief that a above
trading in January,
70 million shares.
was
When
the industrial average reached its
most
high
as
in
September,
trading
had declined to
ume
than
36
1952,
million
the
as
through
shares.
1951
volume
vol¬
It is
more
next
depression
same
as
monthly
even
like
Past
experience,
top,
declined
to
24
D-J
highs
new
in
ties
the
averages, with volume and
breadth of trading substan¬
also
tially lower, has
previous
on
casions foreshadowed
to
lar
oc¬
substantial
the
has
in
boom
decline
the
to
industrial
factor is worth
because
long after
far
as
priced
stocks
should
be
Standard
All
through
1920's,
the
stock
prices to
the
1873 the
depression.
To
that
things
concentrated
in
crash
is
low-
concerned,
Poor's
that
index
the
it
Everything is
the
of
approach
as
of
77%.
well
so
to
stock
had
labor
never
1873
In
to
six
hourly
or
of
labor
it
1879
so
the
from
years
As
far
the
as
stock
market
because there have been
130%.
1914
This
cast
corrected.
by
the
decline
in
the
ulative
low-
priced index than by the new
highs reached by the Dow-Jones
and
Standard-Poor's
stock
indexes.
indicated
This
does
primary
of
by
aggressive
1929, 1930, 1938,
1939, 1941, 1946, 1948, 1949 it was
the low-priced
index that fore¬
professional
vancing to
to
average
$30.70
will
struggled
down
ward
trend
to¬
be
specula¬
earnings
tend
hold
to
de¬
Between
Things May Be Different This
Time
No
Era
The breadth index and the low-
Economic
This
priced stock index thus both fore¬
ocratic
nomic
for
reasons
a
major decline
the next few
over
War I.
years.
this
In
connection
virtually
recorded
the
sale
On
an
prices
108%
dur¬
ing the Civil War period, 127% in
that there will World War I and 134% in the
-everybody interested in economic
forecasting
be
agrees
recession
some
in
general in¬
dustrial activity beginning at some
uncertain future date. The pessi¬
current
cycle.
precedented
the
However,
"new era"
performance
an
un¬
aspect of
of
wholesale
commodity prices is the fact that
opti¬ they continued to advance for six
mists say this recession will start
in
nine
mists
months,
insist
while
that
it
the
will
not
de¬
after the end of the
years
war
in¬
velop until 18 to 30 months have stead of declining rather sharply
•elapsed. In these timing exercises as they did after the two previous
'Government spending gets rela¬ war periods.
There is one price
structure,
tively far more attention than it
however, that deserves a new era
•deserves.
rating in its own right and also
There is a by-product of the
for assisting in the postwar main¬
widespread agreement that some
tenance of the advance in whole¬
recession in business
within
appear
The
one
activity will sale
commodity prices.
to three years.
psychological
mentioned
takes
by-product
the
form
of
a
structure is the perpetual
motion,
round-after-round
steadily
in¬
creasing price of labor.
fairly prevalent suspicion that be¬
Six
everybody agrees there will
Civil
ultimately be a recession this is
ion
there
that
cession
be
the
any
next
re¬
three
Furthermore, there is gen¬
years.
eral agreement
if
•even
won't
within
there is
on
a
the thesis that
recession
there
is little likelihood
that it will be
able to expand to
the dimensions
of
an
Mr. Robert C.
to
recently
think
and
1933
a
a
a
of
this
un
view¬
recession
denression
w^s
of
or even
inevi+eble
the
192Q
to
of the 1920-
of the
74%
level.
152%
In
1951
above
wage
1939
labor
and
the
price has had
and
rates
still
economic
in
general.
end
of
the
41%
as
the
price
of
commodity prices
Six
years
Civil
War
prices showed
ex¬
postwar pe¬
a
New
Era
influence that this
on
a
net
compared
was
the 13 year
no
more
depression
77% advance
a
in 1873.
after
the
wholesale
gain of only
with 74% for
ment
declined
little
a
than 20% but by 1936 prac¬
more
tically all of this decline had
regained.
been
During 1937, as a result
policies pursued
of the aggressive
by
Mr.
John
L.
Lewis
Congress of Industrial
tions
and
his
Organiza¬
hourly
average
earnings
jumped 10% above the high level
of
1929
and
uptrend
that
started
the
steady
1952, car¬
by May,
ried hourly wages 193% above the
for
average
1929.
Of
this
total
only a little more than 10%
contributed during the first
years
New
of
Deal efforts
gadget
the
tions
today's quota¬
right now 1,749,common
extant, with,
subscription
rights
for
500,000
pro¬
of
the
receive
after
the
publicly
in
the
5%
for
leases
■
pro¬
of
policies of the
tration
have
cerned
with
Federal
Adminis¬
been
primarily con¬
combating inflation
against Stalin.
The
New
economic
Deal-Fair
under
been
a
Kind
to
by-product
Labor
cause
We
icy."
These
duce
an
crash.
cycle
of
in
not
excesses
the
Votes
the
that
the
"Be
Pol¬
of
pro¬
unexpected, concentrated
are
the kind of
will
choke
off
of the
inability'of the
whole
prosperity
to
absorb
a
result
economy as
the
receive
nor
increased
elected
was
you
as
commentary is of¬
a rejection
neither
recommendation of this
a
ro¬
mantic item in the over-the-coun¬
ter market.
a
what
It is offered
informative, and
command
to
as
whole
a
does
business of better than
000,
even
than
in
a
obviously
million and
It should be noted that the
industry
you
to
as
as a
some¬
virtual
all
get
the
a
gross
$1,500,000,-
bad year, and better
glamorous
obvi¬
and
ously highly volatile equity.
Speculations in color and depth
fascinate you; but don't let
them
move
you
into a dream
may
two-thirds
of that is being world of
unreality. In an infla¬
larger theatres where tionary era, even glamour can be
Cinerama is most adaptable.
The overpriced! You are the one who
production company
(stock pri¬ has to decide when, or if, it is!
vately held)
has an exclusive
done by the
license
for
tribution
production
of
and
entertainment
picture
by
thereafter
the
dis¬
pic¬
Dec.
Robert F. Bates Joins
two
as
a
the
in
new
vehicle for their sharing
movie,
of
this
should
fascinating
perceive
that
another company will receive the
share
distribution
1957; while
Inc.
erama,
to
The
Financial
Chronicle)
ANGELES, Calif.
has
Bates
with Marache,
future
major
LOS
until 1956, to hold F.
a year
license.
Inc.
Marache, Dofflemyre
(Special
1952
make
must
31,
Thus, those who view Cinerama,
become
—
Robert
associated
Dofflemyre & Co.*
634 South
of
the
change.
Spring Street, members
Los
Angeles Stock Ex¬
Mr. Bates was formerly
Securities Com¬
with Pacific Coast
pany
and
Hannaford
&
Talbot.
Prior thereto he was manager of
and the
trading department of the lo¬
profits, at least till cal office of First California Com¬
the function of Cin¬
of
production
pany.
is to supply cameras
other production and exhibi¬
With Douglass & Co.
tion equipment.
Then,
found
too,
close
Cinerama
critics
not
have
completely
(Special
to The
Financial
Chronicle)
BEVERLY HILLS, Calif.—John
perfect, with some lines and shad¬ C. McCarthy has joined the staff
ings in the picture where the cov¬ of Douglass & Co., 464 North Bed¬
erage of each camera merges with ford
Drive.
He
was
previously
its neighbor.
Moreover, there is with E. D. Baring-Gould.
no
gradually
as
The foregoing
fered
Cine¬
the
gate income of $1
over.
eco¬
however,
that
over a period of years can
produce
serious
maladjustments.
Such
excesses,
maladjustments
to
he
Cinerama
Broadway) of 25% of the iatest and fullest facts (none of
$500,000, scaling down to which you will find here) before
(again — see
prospectus) reaching a value appraisal of this
first
Be¬
kind
can
is
that
of
later date.
(formerly
Productions, Inc.)
it
20
on
10%
of
with
Oct.
Products,
Inc. might perhaps be a catalyst
for merging the
company at
a
receipts from Cine¬
public showings (like the
rama
have
Farmers
Need Their
These
nomic
and
are
of
excesses
contract
a
stock
Chairman
license, in
the com¬
Further,
which
share
and
Deal
under
same,
the
on
of
second
proclaimed
a
apparently been added
by reports that Mr.
L. B. Mayer is a large holder, and
to
condi¬
out
from
Thomas-Todd
in
episode
debenture
has
verve
these,
owns
(under
six
friendship
August, 1939 and 154%
Pearl Harbor, since which
shares
if
This adds up to
speculator,
10% of gross of Cinerama, Inc. for
pictures
pact
333,000
issued
depth,
re¬
added
be
early
Vitarama,
Swelled
spectus)
More than 180%
after the Hitler-Stalin
was
and
to
tures through 1956, provided they
have
$1,000,000 available for a
was
to
$3,
more
apparatus and equipment in the
"theatrical entertainment field" to
and
a
in
would-be
company,
and is to
flate the domestic peacetime econ¬
omy.
than
are
1900's. $8.25, up over $3 since the picture
began showing. The production
certain other points about Cine¬ company and Reeves Soundcraft
rama, Inc. should also be noted. Corp. are reported to hold, be¬
tween them, about 53%
It does not own the
of Cin¬
patents, but
has all rights to them. Another erama, Inc. common, and much
one
Between 1929 and 1933
average
hourly earnings
economic
outstanding
years
war
rising.
of the current
14
ad¬
from
I the gain in
wage
119%, which was about
10-point decline from the 1920
were
was
130%
a
penditures in carrying on the hot
war
against Hitler and the cold
War
peak
peak of
There
300 shares of
Production Corp.
in
lower
tions.
possible 2,632,000 shares that might
be issued and you must figure for
(if* yourself how much gross earnings
be
you're as old or older than I am) would
necessary
to
justify
as
the standard parlor entertain¬ present market price of the
shares,
picture
rama
the
at
rates
was
like
has
in wages
Six years after
Turner, the latest riod,
deserving of
Truman's
designation, involve
statement that he didn't
variety,
advance
an
end
life
a
pany
while forced to make gigantic ex¬
wage
President
summed
a
World
rates
cesses
Council of Economic Advisers, has
point in
hourly
the prewar level.
The
old-fashioned depression.
addition
War
showed
justify the opin¬
after the
years
cause
almost enough to
This price
is
fields.
than
Civil
annual basis whole¬
advanced
the past 20
most
helpful in preventing
in
much
of
like the old fashioned
stereoscope
which
you
will
remember
other
the
mind, however,
Cinerama, Inc. bought their shares
In
The end result
use
vance
Time?
War and in connection with World
method
Bear in
holders convert.
now,
completely politi¬
cally-exploited depression in its
history. The fact that wage rates
Excesses
terialize.
that most of the entrepreneurs in
sight and sound."
experience
over
number of the¬
with several weeks' advance
sales,
then significant profits should ma¬
pro
at
For
listening to Dem¬
politicians
as
you
is de¬
process
new
and
Wholesale
increases
know
personal
deepest
commodity
prices,
shadow a longer-range decline in
despite having reached new rec¬
the stock market. With the tech¬ ord
high levels in 1951, have in the
nical probabilities settled the next current war and
postwar cycle not
problem involves the basic eco¬ greatly exceeded the percentage
in stock prices
result of
as a
were
New
all
we
from
"a
as
a
cities, showing Cin¬
they, too, pack 'em in
they're doing in New York,
If
erama.
way as to provide a realistic three
dimensional perspective as to both
greater than
was
agement to have
1952, covering its offer¬
years, that the United States from
1929 to 1932 suffered the
estimated $22.50 for 1952.
an
a
interme¬
jecting moving pictures, utilizing
triple-lens
camera,
multiple more running to Cinerama Pro-^
microphones, three projectors, and duction Corp., at prices up to
a
large curved screen, in such a $6, 50,000 more to underwriters,
good.
so
or
prices
worthwhile
aters in other
men¬
photographing, recording and
bluntly asserted that labor
had it
However,'
that
now
in 1928
either
were
of
earning power with any accuracy,
although it is hoped by the man¬
shares
company
document, the
scribed
pre¬
living had declined 14% during
never
that
in
1920 peak because the cost
he had
earnings over a
period of two years have receded
lower levels.
to
1
mean,
Dur¬
a
postwar
1920-1921.
by
ing of convertible debentures.
the
these eight years.
Certainly in the
1928 campaign Mr. Hoover would
have been thoroughly justified if
moderate 400 in 1950
a
when
the
of
be
tive operations that prevented the
D-J
industrial stocks
from ad¬
shadowed general market declines
while
the
high-priced averages
avoid
at the
able to stage any really important
advance.
The same regulation of
relative trends in
to
of wages
spec¬
now
not
however, that the market will
industrial
As
no
that must
excesses
number
buy in the market.
can
March 3,
to
increase
contributed
the
pression
is
type of "Smothered
new
ing this period there should be
the
or
con, till you have perused the
prospectus of this company, dated
good.
wages showed an in¬
costs
ceded
concerned, this is perfectly logical
felt
tioning is Cinerama, Inc. and
shoud take no step
whatever,
United
ing for defense, price supports for
1920 and 1922 average
wage rates
low-priced common stocks in Feb¬ farm products,
unemployment and declined
12% but by 1928 all of
ruary broke through its Novem¬ old
age
insurance,
control
of this
loss
had
been
recovered.
ber, 1951 low and continued its prices and wages, and
regulation Wage rates in 1928
were thus
at
decline
in
March, April, May, of the stock market, that it is
very the record postwar
highs, with all
June, August, September and Oc¬ difficult for anything to crash and
of
the
130%
increase resulting
tober.
thus
give warning of imminent from the war
fully retained. Fur¬
The historical record since 1928 economic troubles.
thermore, the purchasing power
justifies the
forecast
that
the
types of
already
The company everyone is
minded,
wage-price-credit spiral that
23
afforded
you
Grant
was
the
1920
cushioned,,
major trend of the market, over a
period possibly of several years, is
now being more
accurately fore¬
is
justified in
were so
From
result of Government spend¬
a
President
that
depression.
a
1860
hourly earnings of labor
pointing out, if he
different this time, it is reasonable
to assume that there wilFbe no
a
Speculation in Color and Depth
engulfed by one of the
be longest depressions in its
history.
will
have
paragraphs to view what it is, and
the
how good a cut at possible
profits
campaign for re-election in
States
insure
showed
From
1872 would have been
the
the outstanding
was
labor
increases.
increased
dramatic feature of the 1929-1933
ex¬
of
wages
in his
wild.
of
serious and pro¬
suffered
by
depressions
greatest
com¬
run
collapse
tracted
the
the
Federal
closely that they
so
companies
re¬
bring
With Kindness
Depression."
industries and
Never Had It So Good
The two most
crease
in
emphasized
&
the
commodity prices that will herald
blow-off
a
prices.
of
wages
resulting from these politi¬
policies.
Certain
this country since the Civil War
followed two periods during which
com¬
This
been established.
As
the collapse of
while
cal
only 44%
gain of 119%.
a
They
their
sub¬
earnings peak had
an
from
was
costs
depressing effects of the combina¬ diate
trading swings in the stock
In
1951
commodity prices tion of an important decline in market
because stock prices are
reached a new record peak 134% demand resulting from high costs.
higher than 1939, and much closer Slowly, over a period of several relatively very low and the im¬
relatively to the 152% gain in years, despite the defense spend¬ pact of the new kind of depression
wage rates than was true follow¬ ing cushion, increasing costs will should be
very gradual.
ing the previous two war periods.
Continued from page 3
they
The most spectacu¬
of the 1920-1922 de¬
Ultimately,
under
comparable circumstances
has the average reached new
highs
so
different
was
allowed
before
never
indi¬
the big difficul¬
stock market
detailed
more
or
variety.
Reserve authorities watched
new
accompanied by a
stantial decline in earnings.
the
variety
however,
of
our
be
1920-1922
one
modity prices
average
been
amination
the
feature
modity
trading,
rather moderate push
highs
1929-1933
are
pression
impor¬
In
volume of
a
breath and
not
with depressions is that
always
recovery.
in
will
predecessors.
interme¬
an
diate reaction rather than
tant further major
addition
the
cates that
to
far
as
undoubtedly true that
July,
struggled
million shares.
Advance
unlikely, is reassuring
it goes.
level that
a
prewar
1929-1933 variety of depression is
tained
In
average
the
trading
little
a
33
1922
or
certainty that other inventions
not duplicate, or
improve upon, Cinerama, perhaps 2
at lower cost. And,
finally, there
is
processes may
a
substantial
cost
element
in¬
With Douglas Hammond
(Special
to
The
Financial
LONG BEACH,
Chronicle)
Calif.—Ned Sil¬
volved in equipping each theater
verman
and Otto E. Tappe have
for Cinerama Projection.
become affiliated with Douglas A.
From the financial
side, it is Hammond. Mr. Tappe was previabsolutely impossible to predict
The Commercial and Financial Chronicle
34
.
.
Thursday, October 23, 1952
.
(1550)
I
sides.
Continued
from first page
Over!
The Bull Market Is Not
two, and would be off-set by those
who follow the formula plan of
at
dinner
I sat next to another very
promi¬
weeks
Several
later
nent forecaster with a fine record
correct
spent
who
forecasts,
to prove to
buying was in
one
hour endeavoring
me
that
lot
odd
due for
was
and the
correction.
lot selling
of odd
excess
market
a
point this out, not to advertise
others'
interpretations,
because
there is no one in the business
I
who has always
the point that many
during the
to emphasize
the
of
been correct, but
forecasts
same
the
consider¬
ably higher prices and have not
factors which
be pertinent to this pres¬
to
picture. Speculation has not
been
running wild—far from it.
All
advances
have
been
very
ent
factory
market
tinues
If an econo¬
relation to bonds.
1950 that
net earnings of corporations after
taxes had reached a peak and that
in
predicted
had
mist
private investment would
reach a peak, he would have
gross
collapse
in the market. Now today I read
and hear on all sides about the
tors
also
been
right, because these two
have been in a
fac¬
alone
de¬
clining
trend
.since
1950.
An
economist, smart enough to pre¬
dict falling net profits, might also
powerful deflationary forces at
forecast declining stock prices. On
work, that the capital investment
the averages he would have been
phase is slowly drawing to a close
and
that
defense
spending
is completely wrong. These reversals
reaching and will soon pass its of stock market action based on
psychology have gone contrary to
peak.
and
Cautiousness
It
had
seems
me
periods in stock market history.
The outstanding example, perhaps,
have is 1946 when we had a severe
that
we
and conservatism in the mar¬
time, and that this
has tended to keep the market
free of excessive speculation, and
during the
kept all reactions
two
past
years
within well
re¬
this last one.
City Bank so
strained limits, even
National
the
As
pointed out in its recent
bulletin, "It is indis¬
rightly
economic
putable that dampening the boom
acts to defer and moderate the
reaction." During the past year
have heard a great deal about
of the steel strike, and
now we are at the election cross¬
you
the effect
with
roads,
concerned
everyone
will
on
the
stock
market. At
have
times like this it is wise not only
to check very carefully the pres¬
ent business picture, but also to
refer to the technical position of
with what effect the election
to look for clues
direction of the next
the market, and
to
as
move
the
importance.
of
First
on
the
many
Conservatism
ket for a long
has
for
forecasts
economic
unusual amount of cautious¬
an
ness
to
of
Amount
Unusual
collapse in the stock market which
was
clearly pictured technically,
earnings
yet
were beginning to
and point higher.
turn the corner
picture:
business
next
year, and that capital ex¬
penditures would reach a new
high in the third quarter this year
and
even
higher in the fourth
quarter. The reason
the
been
business
completed
authorized
sity,
and
for this was
of
un¬
had
not
amount
tremendous
finished
that
under
Certificates of
also
a
big
already
Neces¬
backlog of
residential construction. On inven¬
tories he felt that they were about
in line
with the present level of
Great
great deal of selectivity in the
but also
on
individual stocks within each
technical
strong
a
and I like
pfd. which
RR.
Northern
has
also
rails
priced
higher
action of various groups,
favorite among the
my
pic¬
ture.
There has been no simul¬
taneous reaction.
It has been a
group.
declining, a sition of United Aircraft, Lock¬
Yet, through heed, Boeing, Grumman, Beech,
averages
are
only Douglas, Cessna and Republic. In
experiencing
oils
a
readjustment phase.
the
this
all
top
their
from
5%
about
down
the
in stock
prices has been only about 12%.
Actually, about 52% of the stocks
on the big board have gone down
from the
first of the year and
about 48% have gone up. It would
be very unusual for this bull mar¬
ket to end in this way. Most bull
markets in the past have ended in •
a blaze of glory with violent spec¬
ulation,
especially
in the
low
priced stocks. In
addition, the
present market is selling at about
11
yearly
the
and
1952
times
range
earnings
estimated
$24, paying $15 in divi¬
yielding close to 6%.
In 1930 when the averages were at
of
about
and
dends
point
they
earning $10, paying $7 in
this
approximately
were
stocks
television
I
see
con¬
siderably higher prices for Radio,
Magnavox and Admiral
longer term.
Interna¬
& Tel. definitely also
Philco,
the
over
Tel.
tional
like
looks
good buy at current
a
prices.
Carrier, Servel and York
should
be
purchased
further
are
in
on
stocks
These
weakness.
and
public
asso¬
(Oct. 22) offered
$3,000,000
Benson
Hedges 15-year 4t'2% sinking
fund debentures dated Oct. 1, 1952
due Oct.
and
tures
The deben¬
1, 1967.
priced at 100% and
are
ac¬
interest, to yield 4.50%.
and
in
claims to the
contrary notwithstanding, and I
am certainly no exception to this.
seems
market
100%,
cannot
You
all
reduce
to
an
exact
mathematical formula
variable
as
of stocks
anything so
the buying and selling
by human beings moti¬
by different purposes and
opinions, but the interpretation of
charts does
various
except
give
you some
for
reasons
to
say
that
using
if
charts
you
use
charts to the exclusion of funda¬
mental
research
and
economic
background, you make a very se¬
rious mistake, and it seems to me
that the best results are obtained
by
the
teamwork
between
the
chartist and the statistician. I will
market
the
United,
airlines,
Eastern
ing for
reaccumulat-
slowly
are
another upward
move.
One of the reasons why I cannot
get too
bearish
because
so
and
for
one
on
many
the market is
of stocks
groups
a
such low
of time
is the retail
at
selling
been
have
levels
long period
such
group
technical evidence
obvious
groups
be
of a bear
naturally
of
stocks
which
carefully are
It looks as though
Mathieson and
sible
DuPont.
elimination
of
The pos¬
the
excess
profits tax next year will mate¬
rially help this group. Selective
period
motor
accessory
stocks indicate
of tax
selling which will take
higher levels. I particularly rec¬
place in November and the early
ommend stocks like Electric Autopart of December and which will
Lite,
Bendix,
Briggs,
Standard
cause further irregularity and de¬
Steel Spring and Motor Products
lay in many of the stocks which in this
group.
On the motors I
have
recently reached new
terms
In
doubt
of the
that
made by
a
more
lows. would like to be able to buy Chry¬
Dow Averages,
new
low
will
be
than 2 to 4 points,
possibly the 260-262 level
on
the
Industrials and the 95-96 level
the
rails.
I
still
think
these
industrials and
the rails at
a
in¬
Position
of
on
sler
at
73-75
proximately
and
Motors
55-56
but
at
I'm
ap¬
not
they will be available at
these prices. As defensive stocks,
the
tobaccos
like Philip Morris
sure
have
a
are
beginning to look interesting
highs even though lower earnings may
averages—287-292 result in some reduction or elimi¬
good chance of seeing
both
I
we
new
108-110
later date.
in
each
1952.
pire
Allied
additional
shares
of
ex¬
beneficial;/
55%
stock
standing
Oct.
on
Tobacco &
Inc.,
about
on
share-
rights
1952.
Stocks.
of
owner
held
Subscription
Nov. 3,
on
stock
common
one
ten
the
of
out¬
Benson
and
Hedges, has agreed to exercise alL
rights which it receives
holder of the company
the
debentures
tional
nation of the extra dividends this
year-end. The grocery chains such
as American Stores and Safeway,
and
of
course
the utilities and
and
as a
stock-r
and also to:
the
of
addi-r
will
stock
common
be
added to the general funds of the/
Approximately $1,750,-*
will be used
company.
000 of such proceeds
to reduce notes
payable outstand-i
ing in the amount of $3,200,000
of Sept. 30,
will
be
as>
1952, and the balance
used
purchase
principally
additional
the,
for
of leaf tobacco
and for
facili¬
manufacturing
ties.
:
A
sinking fund will provide
nual payments which
Oct.
on
1953
1,
an¬
will redeem
1966, in-'
through
elusive, $200,000 principal amount
of
the
debentures
at
price
a
of
100%, plus accrued interest. The
company has the right to increase
any
payment up to an amount
sufficient to redeem
The debentures will be
redeemable
104%
at
the
option of the'
in whole or in part, at
and including Oct.
1,'
company,
to
1955,
additional
an
principal amount of de¬
$200,000
watched
will have to go through the
in
most
yet that this
trend. After election we
for the
the
as
reaction is the beginning
for
20,
of
bentures.
Other
individual stocks has about
the chemicals.
spent its force and after a period
this group is pretty well sold out,
of
readjustment and consolida¬
and are in the process of reform¬
tion,
which
will
now
take
a
longer time to reform a base, that ing a base for another upward
I refer to stocks such as
a
renewal of the major upward4 swing.
American Cyanamid,
trend will continue. There is no:: Monsanto,
many
an
sometimes
It
time.
some
tween 53-55.
should
also
say that charts do give you
insight on what is the best time
buy and sell stocks and that
for
though this correction in
as
basis
reach purchase, at the subscription price,;
The any unsubscribed stock.
Net proceeds from the sale of
American and
community
who has been able to forecast the
the
levels.
higher
considerably
yielding
dividends
tional shares of
strong technical position to
Groups of Stocks
On savings he felt that terpretation of news and statistics
does not always turn out to be
Now to be as specific as possi¬ foods, are defensive stocks.
The
disposable income had held up
the correct one. I prefer to think ble about a few groups of stocks paper stocks may go a little lower,
relatively well regardless of
of myself as a "securitician" or a and individual issues.
You don't but International Paper at 45-46,
taxes. Savings were about 7% as
"technalycist" rather than a tech¬ buy the market as a whole, you Kimberly-Clark at 43-44, St.
against 9% last year. In general,
nician.
I
don't
like
that
word buy individual stocks.
The oils Regis at 18 and Mead Corp. at
he felt that there were no major
have led this market down and 23-24 look like interesting buys
"Technician."
factors
in the businesspicture
have suffered a 15% to 20% de¬ for the longer pull. Container also
that looked weak, and that 1953
cline from their 1952 highs. There looks very interesting. The steels
What's Ahead in the Market
would be a very normal year.
is at present no technical evidence are basing out slowly and are in
Now sticking my neck out and
Another economist stated that
of a major upward move in this
buying range for a reasonable up¬
he felt that industrial manufac¬ making a prediction on the mar¬
group, but selling now close to a ward move.
turers were once more working ket, I am reminded of the M-G-M
lion who roars before each picture 6% yield basis it would seem that
There are many other individual
against a huge backlog of unfilled
from approximately these levels
and he roars just as loud whether
stocks in addition to those in the
orders instead of trying to liqui¬
the picture is a hit or just plain they woud be entitled to some re¬ groups
mentioned above which
date stocks, and that the heavy
covery movement.
The oils still look
terrible.
Today I can't roar as
extremely interesting at cur¬
industries have on hand enough
need a good long healthy period
rent
levels
and /Which
should
loudly about certain segments of
orders to keep them at peak oper¬
of
reaccumulation.
Therefore
I
the market as others, in fact I
reach higher prices. " In general, I
ations for many months. Still an¬
would be inclined to use such a
should
continue to maintain a selectively
only whisper, and
this
other top economist is forecasting
forecast may also turn out to be recovery to lighten position in this bullish position and/1 believe that
gross national production of $359
group.
the ownership of stocks should
terrible, in which case you will
billion for 1952, which is about
The metals are another group work out better than holding cash.
surely remember it.
Today my
5% above last year, and expects
which have been weak lately, but I further believe that the period
present feeling might be charac¬
spending to point up in the first terized and
described as being a from present prices I believe that ahead will provide a very attrac¬
quarter of 1953.
cowardly bull. I am cowardly be¬ they also are entitled to some re¬ tive buying opportunity. I can't
I cite this economic background cause of so much
obviously un¬ covery move. The rails have shown roar quite as vigorously as I have
from experts because it seems im¬ favorable news and
predictions of relatively strong action on this done in the past about the market,
portant in evaluating and cor¬ things to come that I hear on all setback in holding above their but I can still bark a-little.
business.
the
to
three
The
,
to
ciates yesterday
crued
4%. The trade. If the economists are right
today
is in telling us that consumer spend¬
literally seething with divergent ing will reach a new high next
There: have been many ex¬
views on what is likely to happen. year, it stands to reason that some
amples in the past where stock In
general there is too much com¬ of this spending will seep through
prices did not follow earnings—
to the department stores and in
pany on the bearish side.
too many to cite. With the present
this connection the technical posi¬
The decline in the averages we
conflicting and confusing trend as
tion of Allied Stores, Associated
to earnings, armament spending experienced last week held within
Dry
Goods,
May
Department
normal technical limits of a full
and last but not least the election,
Stores, Marshall Field and Fed¬
% intermediate secondary correc¬
a
close examination of the tech¬
erated indicate these to be good
nical side of thq market has al¬ tion of the rally from 255 to 281
which took place this spring and buys on any further very minor
ways seemed to me most impor¬
correction.
Montgomery
W a r d
tant. Let me say at the beginning, summer. In percentage this is the
looks like a pretty good buy be¬
that I have never seen anyone smallest correction we have had
vated
I had the privilege
a
financial
Earnings and Stock Prices
idea of
of listing to a prominent econo¬ what other buyers and sellers are
mist discussing the general busi¬ doing.
When a man invests his
ness
picture,
and
it
was
his money in stocks, the actual trans¬
opinion that business for
1953 action is recorded on the tape and
would
be
more
uniform,
that this is money on the line so to
government armament expendi¬ speak, not a curbstone opinion. I
tures would be $10 billion higher do not intend to go into all the
The other day
Railway is
Southern
weakness.
further
on
say
and Stock Offered'
Morgan Stanley & Co. and
highs. Net earnings are
new
literally
shrieking "wolf, wolf" from the
house tops, and warning of the
An
is trite to
it
that
have been going through
we
Hedges Debs,
with
ing
past two years have been
imminent relapse or even
that
Benson &
groups which
look
industries are boom¬
Contemporaneously with the of¬
employment reaching staggering, twisting, rolling read¬ the best to me from a longer fering of debentures Benson and
satis¬ justment with the drugs, rayon range technical angle are the air- Hedges is offering to holders of its
and the ratio of current textiles, motion
pictures, retail crafts, television and electronic, outstanding common stock the
air-conditioning
stocks.
I right to subscribe at $23.50 a share
prices to dividends con¬ trade,
liquors, tobaccos, copper and
relatively low especially and lead and more recently the particularly like the technical po¬ for an aggregate of 39,738 addi¬
orderly. Most
in
realize
I
higher levels and could be bought
exploited as yet.
been
action. There
other important
seem
lower
many
patterns which indicate
picture behind
present market
are
investing.
of
relating the overall
lows.: Many of the
priced rails such as Erie,
Baltimore & Ohio, Chicago, Mil¬
waukee & St. Paul, Pennsylvania,
St. Louis, San Francisco and New
York Central appear headed for
September
because I see
bullish
am
good technical patterns
unfolding which have had long
drawn out corrections and other
so
decreasing prices there¬
1, 1964
at
after to and including Oct.
thereafter
and
'Benson
100%, plus
at
in each
interest
crued
and
ac¬
case.
Hedges is engaged
primarily in the business of man-.
ufacturing and selling cigarettes..
principal product is Parlia-.
filter-mouthpiece cigarettes,.
Its
ment
which have constituted over 90%
company's sales since 1950..
of the
The
smoking
cigarettes,
sells
other brands of
several
sells
and
manufactures'
also
company
tobacco,
and
cigars,
both
brand
several
of
all
domestic
and
which
manufactured by others
are
the
for
months
was
For
company.
ended
totaled
sales
income
imported,
June
30,
$9,021,963
the
six
1952, net
and
net
applicable to the common
$328,314, equal to 83 cents a
share.
Other members of the group are
Clark, Dodge & Co., Lee Higgin-.
son
Corp., and Wertheim & Co.
-
Williamson Onens
Fla.—Hybert J.
engaging in the se- 1
FORT PIERCE,
Williamson is
curities
100
from
business
Indian
South
offices
at
River Drive.
Now Barucl* ^ Co.
•
The firm
schild &
name
of Baruch, Roth-
Co., Inc., 44 Wall Street,
New York
City, has been changed
to Baruch &
Co., Inc.
.
Franz Bachm*"" Ooens
Franz Bachmann is
a
securities business
at 61
engaging in
from
offices
Broadway, New York City.
George Dia*— Opens
George
Diason
i*
engaging
in
the securities business from offices Z
at
2324
Paulding Avenue,, Bronx,
New York.
.
Volume 176
Number 5162
,
.
.
The Commercial and. Financial Chronicle
.
"i
(1551)
The
Indications of Current
Business
Activity
week
Latest
AMERICAN
V
IRON
Indicated
;
<
steel
Equivalent
Steel
AMERICAN
(percent
castings
(net
oi
and
runs
Oct. 26
to
Kerosene
Distillate
fuel
Residual
Distillate
Residual
2,214,000
ASSOCIATION
Oct. 11
6,329,350
116,854,000
6,928,000
7,059,000
6,426,000
23,032,000
23,451,000
24,132,000
21,330,000
2,640,000
2,595,000
2,512,000
10,423.000
10,388,000
8,799,000
8,188,000
8,966,000
8,523,000
8,396,000
120,910,000
119,793,000
117,296,000
121,895,000
36,007,000
Oct!
11
35,212,000
33,724,000
li8,078,000
108,641,000
Oct. 11
at
35,529,000
120,076,000
54,617,000
53,274,000
S.
.Public
.
Oct. 11
construction
842.713
851,866
700,008
$333,337,000
Oct. 16
S.
Bituminous coal and lignite
Pennsylvania
anthracite
Beehive
OF
(tons)
ELECTRIC
Electric
output
FAILURES
INDEX—FEDERAL
AVERAGE
(in
000
11
130,686,000
,129,809,000
DUN
—
86,344,000
43,800,000
AGE
(per
*9,075,000
11,850,000
Scrap
steel
MFTAL
(per
PRICES
Electrolytic
(E.
&
925,000
tin
Lead
(New
Lead
(St
125
116
114
Zinc
York)
(East
St.
J.
I!
;
7,681,332
7,697,880
139
147
145
4.376c
4.376c
$55.26
$55.26
$42.00
$42.00
at
24.200c
24.200c
35.275c
121.500c
14.000c
15.000c
16.000c
14.800c
15.800c
Oct. 15
18.800c
13.500c
Aaa
108.88
109.06
109.42
112.93
113.89
115-24
111.62
111.81
YIELD
DAILY
109.06
105.86
106.21
106.56
Oct. 21
107.62
108.88
109.06
109.42
110.1
111.81
I,,,,.,
.i
112.19
in.
ii—-,
■
112.93
Oct- -1
2.73
2.76
3.23
3.22
Oct. 21
3.02
3.01
I
2.73
3.23
2.96
Oct. 21
3.08
3.07
3.24
3.22
Oct. 21
MOODY'S
Orders
received
Unfilled
OIL,
3.36
3.20
3.07
3.05
3.01
AND
AVERAGE
OF
415.3
418.9
426.3
'
236,587
DRUG
end
of
period
REPORTER
LOT
DEALERS
PRICE
335,236
241,601
sales
AND
SPECIALISTS
by
Number
of
Number
of
233,756
ON
EXCHANGE
93
90
553,261
488,931
486,887
*109.28
109.48
116.14
■
109.39
N.
(customers'
by
dealers
Customers'
short
(customers'
total
4
Oct.
4
696,284
689,120
532,684
4
$32,638,271
$31,188,227
$24,707,669
Oct.
4
20,720
25,166
.....
24,083
18,965
shares—Total
sales
other
sales——
i
sales
of
Other
Number
of
FOR
Total
31,2ob
4
581,641
599,922
470,226
907,734
4
4,798
576,843
Oct.
4
4
ROUND-LOT
AND
4
Oct.
4
THE
NEW
3,649
6,453
$24,376,660
$19,269,163
901,281
$35,613,509
142,870
237,170
Oats
173,400
"
142,870
237,170
Rye
A
sales
Other
sales
Total
v
269,520
276,640
201,730
399,260
.
,
ACCOUNT
OF
Total
saleS
107,590
89,140
72,510
155,580
512,110
427,290
336,350
733,930
619,700
516,430
408,860
889,510
556,920
*
190,840
136,020
450,960
881,670
226,350
11,700
Sep. 27
196,240
127,200
75,330
285,800
221,950
212,950
177,770
278,860
34,670
31,800
16,460
37,750
Sep. 27
274,100
259,170
225,295
198,690
326,852
293,840
257,095
215,150
364,602
1,069,500
S.
DEPT.
905,890
136,340
715,130
155,360
94,170
Sep. 27
Sep. 27
U.
All
764,385
1,109,780
900,725
605,170
699,340
1,539,912
OF
and
foods
IIIncludes 592,000 barrels of foreign
*111.1
645,469
236,331
CROP
235,705
342,005
REPORTING
Oct.
1
OF
(in
AGRI¬
thousands):
254,658
15,759
21,410
30,685
bags)
47,730
46,218
43,805
(bushels)—
70,996
72,377
159,265
103,858
13,889
102,417
108 461
11,083
11,083
12,563
14,413
(3
7,479
17,446
.
3,763
286,209
275,929
280,512
1,188,225
1,676,125
345,561
I
(bushels)
337,685
325,708
30,814
seed
28,278
2,210,435
7,424
(tons)
29,669
2,234,535
and
7,717
2,328,226
6,120
10,334
10,166
10,485
34
61,342
63,239
95,975
98,058
110,660
62,622
61,626
63,627
30,879
29,833
30,028
3,092
3,027
3,386
202
202
I74
174
183
812
980
910
127,256
125,566
154,895
$3,545,450
$1,871,150
$2,807,800
$1,070,400
$1,015,900
$1.2r~
817,000
837,000
a
.
—
—--
States)
28
61,330
—
States)
Cranberries
2,697
1,225,145
—
(tons)
Apricots
15,529
2,697
(tons)
(12
42,937
32,035
5,590
16,291
bags)
41,089
31,043
5,895
(bushels)
Cherries
15,144
31,043
(tons):.
(bushels)
(tons)
,
33,802
42,040
timothy
(tons)
Hops (pounds)
Apples, commercial crop (bushels)
Peaches
(bushels)—1—
Grapes
306,185
1,316,396"
221,138
(tons)
beets
35,820
214,112
31,033
(pounds)
Broomcorn
1,263,886
.222,476
;
(pounds)
_!
Sugarcane for sugar
Sugar
21,593
214,907
1,265,660
987,474
(tons)
——
(tons)
(5 States)
—
(barrels)
(pounds)
t
230
a No
estimate
for
October.
1,334,882
TREASURY MARKET
AND
S.
TRANSACTIONS
GUARANTEED
A.—Month
110.0
14
107.3
Oct. 14
112.6
IN DI¬
SECURITIES
runs.
September:
sales
108.3
-
112.9
112.6
112.7
UNITED
—
STATES
BUREAU OF
-
(000's
Imports
EXPORTS
CENSUS
—
AND
IMPORTS
Month of
August
omitted):
1
Exports
crude
of
106.2
*108.5
U.
Net purchases
111.3
*106.6
108.1
—III—. Oct!
2,941,423
1,298,295
1,662,590
■'
15,759
Sweetpotatoes
Net
foods
figure,
3,185,237
•'
-
:
and
RECT
104.6
Meats
♦Revised
15,144,000
1,062,590
1
(bushels)-
pound
OF
110.7
than farm
13,889,0.00
1,298,921
Oct.
Tobacco
1,386,880
Group—
All commodities other
321.6
'
products
Processed
347.3
205,030
954.420
commodities
Farm
1,095
3,256,550
of
DEPARTMENT
of
grain,
Potatoes
Pecans
Sep. 27
_
—
"1,134
OF
(bales)
Pears
LABOR—' 1947-49 =100);
Commodity
(100
Peanuts
656,710
floor—
SERIES
1,398
338.0
DEPT.
as
dry edible (100 pound
dry field (bags),
Soybeans for beans (bushels)
5,200
:
NEW
3,724
14,413,000
S.
Beans,
86,400
_
PRICES,
6,217
3,891
(1935-
Peas,
70,130
sales
WHOLESALE
Rice
alfalfa
15,400
sales
sales
*6,469
•1,444
1,134
bales
—
(bushels)
clover
111,800
purchases
snort
5,798
COMMODITIES
(bushels)
Hay,
13,100
sales
Other
Total
OF
(bushels)
Hay,
Total round-lot transactions for account of members—
Total
*6,703
3,891
_
gross
spring
Hay, lespedeza
278,140
183,140
sales
Other
Total
the
3,109
6,486
(bushels)
8,428,970
Sep. 27
off
4,138
*3,442
21,424
Other
8,707,110
124,940
Sep. 27
Sep. 27
Sep. 27
purchases
7,247
*4,606
1,461
__
loans
(bushels)
4,578,730
190,800
Sep. 27
•
transactions initiated
Short
spring
4,703,670
-Sep. 27
sales
•
Total
13,045
4,620
__
credit
S.
5,626,080
-Sep. 27
Other
U.
5,816,880
floor-
purchases
Short
$19,262
*8,048
6,778
500-lb.
208.970
Sep. 27
Sep. 27
sales
sales
the
*$21,220
*14,751
461,506
3,509
__
PURCHASES
6,869,970
Sep. 27
,
on
156,701
14,907
8,129
-
—
_
credit
6,661,000
MEM¬
—
initiated
304,805
1,412,992
j
_
accounts
Sep. 27
Sep. 27
transactions
455,652
294,149
RE¬
_
payment
Sep. 27
sales
Other
Total
Other
$917,158
503,431
1,707,141
4
short-term
____
Seb- 27
—;
purchases
Short
FEDERAL
August 31:
Hay, all (tons)
Hay, wild (tons)
(SHARES):
TRANSACTIONS' FOR
$2,210,572
441,893
510,325
267,607
-
Durum
Cotton
BERS. EXCEPT ODD-LOT DEALERS AND SPECIALISTS
Transactions of specialists in stocks in which registered—
Total
All
Sorghum
YORK
sales
ROUND-LOT
of
(bushels)
Flaxseed
.
_
$1,148,400
$21,393
THE
of
PRODUCTION —U.
Barley
176,730
•
STOCK TRANSACTIONS
ACCOUNT OF MEMBERS
sales—
$231,000
EN¬
credit
Winter
466,577
Round-lot
Short
—
'
Estimated
as
credit
CULTURE—As
173,400
176,730
shares
ON
7
DE¬
Corn, all (bushels)
Wheat, all (bushels)
595,082
4
,.v
SALES
OF
PRODUCTION
4,840
,
$23,886,623
—Oct.
I
sales—
dealers—
STOCK
S.
1*
I
;•
credit
credit
BOARD
181
17,471
Oct.
ROUND-LOT
EXCHANGE
106
21,164
—-—Oct.
purchases by
77
6
$952,218
AGRICULTURE—Estimates
31,437
128
20,579
4
sales
Round-lot
17,577
141
4
—Oct.
dealers—
by
21,292
4
Oct.
—Oct.
—
shares—Total
21
5
,j
Oct.
—■—
sales
Short
TOTAL
;
60
19
79
;
—
millions
Production
sales
short
64
77
OUTSTANDING—BOARD
SYSTEM
CONSUMER
35,600
Oct.
Customers'
62
22
omitted);
CREDIT
Service
CROP
——
Customers'
Number
303
242,718
Charge
1,054,653
$45,2 /.$,o
stfles)—
sales
sales
Round-lot
335
40
Month of
—
municipal—
consumer
COTTON
sales
other
value
129
$1,158,000
U.
—
DUN
&
BRADSTREET,
INC.
1939=100)—Month of September
Oct.
Customers'
Dollar
40
152
325
—
purchases)—
—
orders—Customers'
of
32
153
CONSTRUCTION
'
Single
'
Number
136
41
33
NEWS-RECORD —Month
V Noninstalment
STOCK
Y.
Oct.
purchases
103
139
COMMISSION:
value
Number of
168
42
omitted)
Other
211,413
95
544,741
Oct. 17
shares
Odd-lot
319
INDEX—
-
dealers
orders
Dollar
380
<
REPORTED
COMMERCE
(000's
in
Sale
171,817
240,751
'
i
Oct. 11
100
EXCHANGE—SECURITIES
Odd-lot
63
1
construction
Instalment
4TOCK TRANSACTIONS FOR ODD-LOT ACCOUNT OF ODD1
OF
(000's
GOVERNORS
Total
462.5
' 96
•
——Oct. 11
at
6
979
54
378
PUBLICLY
—
Automobile
245,680
Oct. 11
—
8 •
1,089
.
'
'
SERVE
Loan
:
—
7
construction
-t
Credit
2.94
Oct. 21
activity
43
274
53
CORPORATIONS
S.
CONSUMER
3.16
Oct. 11
(tons)
U.
V
■
3.30
3.22
(tons)
35
48
296
141
State * and
ASSOCIATION:
(tons)
orders
PAINT
1949
3.38
3.23
INDEX
37
43
1,075
3.52
Oct. 21
PAPERBOARD
Production
3.53
3.40
Group
Percentage of
3.54
Oct. 21
COMMODITY
NATIONAL
3.55
—Oct. 21
Group
352
291
Public construction
v
3.18
Industrials
telegraph
public
S.
Private
'•
2.93
3.25
Group
26
179
381
162
GINEERING
2.89
3.09
Oct. 21
Utilities
26
183
private
September
2.65
3.20
as
3aa
PudIic
U.
Total
114,27
A
Railroad
27
Federal
-t—..r:.,-"_i—1_
—
37
376
utilities
ENGINEERING
AVERAGES:
0ct- 21
nT--mmn.il-if
CIVIL
103.80
corporate
34
168
:
DIVIDENDS
BY
109.79
103.64
1
32
12
32
37
Septemoer
114.46
108.70
10:^7
;
42
32
12
110.70
112.75
Oct. 21
Group
Government Bonds
Average
1
and
PARTMENT
Group
BOND
,
construction
other
CASH
97.6r
103.30
MOODY'S
d.
96.67
AVERAGES:
-Oct. 21
Utilities
All
19.500c
96.29
108.52
0
14.500c
96.63
Oct. 21
DAILY
13.500c
Oct. 21
PRICES
37
45
19.000c
13.800c
149
34
and water
Miscellaneous public-service enterprises
Conservation and development
103.000c
Oct. 15
at
121.500c
Oct. 14
at
at
121.500c
56
141
13
Other nonresidential
building
Military and naval facilities
Highways
27.425c
Oct. 15
.
101
43
55
*
institutional
Hospital and institutional
24.200c
34.575c
98
38
I
Sewer
24.200c
210
14*
Industrial
$43.00
34.825c
181
57
building
Nonresidential
building
$52.72
$42.00
•
16
460
44
Residential
4.131c
$55.26
18
420
188
:
recreational
public
other
93
18
433
(nonfarm)
utilities
Other
157
<•*"'
Oct. 15
Group
Industrials
100
Railroad
7,149,458
Oct. 15
Aaa
Puonc
849
100
construction
Public
QUOTATIONS):
corporate
Railroad
Farm
Public
7,724,664
4.376c
Oct. 14
Government Bonds
Average
930
Educational
M.
Louis)
BOND
958
935
'
alterations
and
Telephone
111.44
(J. 6.
1,955
1,048
101
and
Hospital
All
Oct. 11
MOODY'S
and
Educational
117
■'<
Oct. 14
ton)
York)
Louis)
$2,934
2,040
1,053
(nonfarm)
dwelling units
Social
copper—
(New
$3,129
2,037
millions):
:
Warehouses, office and loft buildingsStores, restaurants, and garages
'
nonresidential building
Religious
1,049,000
'
Oct. 14
Domestic refinery at
Export refinery at
Straits
109,159
DEPT. OF
(in
Sept.
S.
Otner
138,100
PRICES:
lb.)
gross
384,680
240,741
117,614
$3,112
of
Nonresidential building
Industrial
11,030,000
863,000
■<;
86,300
.
ton)
gross
New
18,369,000
*87,900
Oct. 16
COMPOSITE
steel
43,465,000
85,600
-
Finished
$734,580
476,426
275,250
107,890
construction
Additions
52,682,000
■
Pig Iron (per
Month
—
construction
Residential
building
&
BRADSTREET. INC.
IRON
$869,290
443,760
244,973
etc.
CONSTRUCTION—U.
new
71,051,000
93,093,000
884,000
Oct. 11-
INDUSTRIAL)
$796,623
Private
124,169,000
...
9,050,000
11
Oct. 18
AND
Ago
S.
■
alterations,
LABOR
-
$195,220,000
T
kwh.)
(COMMERCIAL
BUILDING
RESERVE
100
=
INSTITUTE:
Year
Month
of
Miscellaneous
Oct
Oct
__
(tons)
SALES
SYSTEM—1941-49
EDISON
Additions,
,
Oct. 11
DEPARTMENT STORE
$260,495,000
56,801,000
MINES):
(tons)
coke
U.
Month
—
nonresidential
696,338
136,893,000
127,124,000
Oct. 16
BUREAU
691,166
204,680,000
70,323,000
OUTPUT (U.
Previous
omitted):
New
868,683
$341,573,000
206,213,000
Oct. 16
municipal
Federal
COAL
881,218
723,941
of that date:
VALUA¬
THE
Commercial
Oct. 16
construction
and
LABOR
residential
ENGINEERING
construction
State
OF
Nonhousekeeping
freight received from connections (no. of cars)„Oct. 11
Private
OF
i
.
—
PERMIT
AREAS
building construction
50,378,000
freight
CONSTRUCTION
(000's
DEPT.
New
107,224,000
54,423,000
Revenue
ENGINEERING
NEWS-RECORD:
S.
Total
Oct. 11
at
AMERICAN RAILROADS:
loaded (number of cars)
CIVIL
URBAN
2,437,000
10,094,000
(bbls.)
(bbls.)
CONSTRUCTION
IN
—U.
All
6,460,500
tDDib.i
either for the
are as
Month
BUILDING
2,057,000
Oct. H
(bbls.)
oil
OF
2,160,000
6,514,500
Revenue
U.
*2,211,000
Oct, li
oil
fuel
102.9
6,517,100
oil
fuel
of quotations,
cases
Latest
104.0
TION
output (bbls.)
Oct. 11
Stocks at refineries, bulk
terminals, in transit, in pipe lines—
Finished and unfinished
gasoline (bbls.) at
Oct. 11
Kerosene (bbls.) at
Total
*106.5
of
(bbls.)
output
in
or,
are
>
Oct. 11
average
Dates shown in first column
July
(bbls.
average
(bbls.)
oil
fuel
Yea
production and other figures for the
cover
that date,
on
—Oct. 11
stills—daily
output
month available.
Ac
106.6
Oct. 26
each)
output
Montr
Week
capacity)
tons)
INSTITUTE:
condensate output—daily
gallons
Gasoline
i
operations
and
or
month ended
or
Previous
TF TROLEIIM
oil
42
Crude
STEEL INSTITUTE:
to—
ingots
Crude
AND
following statistical tabulations
latest week
35
;
—
880.800
1
36
The Commercial and Financial Chronicle
'(1552)
Continued
jrom
m
mk
1
DyAC*Ant
A ICSvllI
mm
ffl
m
Dl*#IA
PIOSD6C1IV6
i
lUipvVIIlV
a fin
anil
w\
illlflAar Elt&ICIV
AlUvlvU AlllwAJJJr
Zmm
mistaken,
is inextricably linked with
th
P
sale of Plutonium. So far as we can
now tell a market for Plutonium
w
a
bombs.
nium
government marketfor
to make and stockpile
If
the
long-term
,ience
very
th0
®le.
home
of
^wnen we
s
can
P
I
^
fcr
permanent
Chairman
of
time when
drive
we can
make
to
will
there
that
come
a
stop our urgent
and more
more
atomic weapons and
sit back, look
stockpile and say now we
enough.
vEven if this time as envisioned
st
our
tive
t^te'a g^dd0m?nyVea?s
eontingefmy to which
off, the
he has
drawn attention must radically af-
development of
feet and limit the
nuclear power plants as a
by prodPlutonium process.
plan power plants for
of the
net
When
we
commercial
©aires that
terms of
even
40
we
re-
economics
use
think of them in
useful life of 25, 80 or
a
more
or
the energy
electricity, is also ris-
we
must be con-
St,
that the electric require-
the
of
ments
country
will
be
quadrupled between 1950
The report further preproportion of these
to be supplied from fuel
nearly
1975
and
dtcts that the
needs
by the PicureOurpast
experience should tell us that we
can take steps to overcome these
adverse factors. Certainly the exmayed
perience in electric power supply
in the United States over the past
increase over several decades should encourage
19B0 No responsible authority is us to believe that we can meet
today suggesting that we shall be such a problem of rising costs.
m
substantially
^Vby
i^ and
Accelerated Doubling of Demand
nucte energy. Whether
The demand for electric power,
and to what extent nuclear energy
assumes
a
large role in the long-
picture depends upon the de-
term
vei0pments that occur in the field
in the years immediately ahead.
And these deVelopments, even if
higbiy favorable, are not likely to
that nuclear energy will
uys
It is diffi-
years.
"use,
energy
nor from the standrequirements by the Presi- point 0f expanding our economy as
dent's Material Policy Commission a whole. But we should not be dis-
energy
?ndicated
lve
our
p0wer
problems of the
and the
capacity to meet that demandj has doubled on the average
every
decade for the past 40 years.
This has been done while the price
electrjc service
Qf
j
requirements
most economical way,
it
the
in
is neces-
not only to make full allow-
sary
to atomic energy
but also the ex-
has been
kept
actually has been reduced
hile tbe cost 0f everything else
j or
^fgoing
sharply. No better
up
important
wider scale.
question of how we can
that we shall make the
narrower
best
assure
opportunity
^
whether
out
nuclear
to
find
power
is
feasible and if we
determine that it is, how best to
facilitate its rapid development.
commercially
t
prQgram
collaborating
the pro-
otherwise to underwrite
ject.
Whatever the value and the interest in
proceeding with present
developments of ideas for such
plants in the end hope for nuclear
energy as a more
economical
pent
rest
must
reactor
and
the
And
on
or
less permaof power
source
the
straight
breeder
the
power
reactor.
of
optimism
recent
months, however justified, has not
grown
particularly out of any
spectacular developments in relation to such reactors. As to them,
while
ahead of
stood when
people were saying, several years
ago., that it would be a matter of
we
are
the point
certainly
where we
"decades" before
cal power,
had
we
there is
believing that we
no
are
economi-
reason
lor
unexpected-
ly further ahead.
So that all of this gratifying ex-
of
still leaves
be
supported.
rp<;parrh
T
i
investigations
AEC
by
tools
with
the
a
look
"into
this
reveal
today
a
"brighter picture
than it would have revealed
cently
as a year
or
as re-
even
six
to find this
0n
an
^g |be pMPC report and others
bave pointed out, a number of unfav0rable developments have been
taking place in the coal industry,
and particularly in that part of
sense
getting under
way.
This
of encouragement should not
concerned
with the successful
ex-
ploitation of the opportunities for
peacetime uses of atomic energy,
u
nuclear
becomes
power-
a
reality,
the
utility
systems of the country would be
the largest
actors
potential
just
largest
steam
they
as
of
users
of
users
re-
today the
are
the
fuel
fired
boilers. It is the utility m-
dustry,
therefore, which
perhaps
than any other is interested
more
in the prospects for nuclear power,
The jndustry h
the
kind of
same
now
future
in
g?™ge^Uall
and
time
reduce
the
ihe
the
cost
of
economic,
self-supporting commercial r
actors.
jt
is
also
develop¬
new
aprVoduPc.
highly
of
program
and study
survey
dustrial groups
collaborating with
path that would
seem
that
been
each
plans
necessity
a
system
was to
could
responsive
crowth
which
to
is
acteristic of the industry
the
char-
The in-
inem^
keep costs down and im-
prove^service,it hadI to participate
^cU^andjHecUvely m promotS
n0wer
po\\ er productiontheutmtv svsproduction the utility sys
^
of
technology by private in-
AEC. As ! said earlier these
has
conventional
desirable to
continue and expand the present
reactor
its
dvnamic
materially lessen
successful
developing
This
order
make
operation at the
m
Rfac\or ^t^on "itb
work of the AEC with
the
the
,
tional
the
Utilities have always kept close-
^
.
are
°£
t
g
su^
*
witn tne
manufacturers of equipment, the
sur-
most prom-
oi
woik and in collaboration
°. f"e
stitutions
ua"d
It is such work which
has enabled
us m recent years to
increase t e thermal efficiency of
steam plants from
about
13 fo
to 4U%.
This process of
velopment
technological de-
has
been
with
one
Always
energy.
t
•
is the
particularly to emphathat whiie we are pursuing
mean
them
sub-
seem
stantiany iess difficult and less
costly than those confronting us
jn
nuclear
power.
Without
ifying the details of such
opment
spec-
devel-
a
for
coal, four
promise can be
program
items
three
of
these
threshold
four
of
are
the
on
realization.
be
prime example. There will
some carry-over
of technology
land
based
service.
This
of
fuel
badly
for power plants—suffers
in
comparison
with
other
fuRy developed, promise material
reduction
the
point
in
of
the
cost
of
coal
at
Underground
gasification gives, besides, promise
use.
0f substantial enhancement of the
economical recovery of coal other-
wise too
difficut
to
mine.
In short, in budgeting
our
have found it
the
we
one
s
another
interval
^nowjedge by
energy
involved
in
fission
and
that
significant
acquisition of
any
one of us and the
an.
The
years
clear
between
snaring of that knowledge
among
technically
nu-
should learn from
mistakes
there should not be
been
concerned with release of the
technological devel-
leagues that
method
economically:
Technically—the problem will be
we
important part of
that
.we should profit by
discoveries of all our col-
the
of approach will have advantages
and
an
process of
conditions
which
I
have
describing and which for
have been taken for
granted
in the power
industry have in my
opinion been indispensable
factors
in
establishing
record
of
the
remarkable
maintaining and
reducing cost levels at
when general costs were
even
time
a
going
up
sharply.
0£ ug are farrdbar
^he
always be possible to
reasons why thege
conditions do
valid judgment on the econot exist
today with respect to this
nomic worth or justification of the
and it will
The pass
fourth, underground gasification,
dieselization, the loss of the do- is far less advanced. All, if success-
mestic fuel market to liquid fuels
est as compared with the ultimate
_0n and gas—and the rise in the
dimensions of the problem. We are
cost 0f mining coal. An examinaentitled to be optimistic but only
tion 0f the changes in price levels
in the sense of feeling encouraged
at the point of production shows
because a long and difficult job that
bituminous coal—main source
is at last
in and out of government who are
energy
golved to realize
large quantity of coal
economical basis.
these are the loss of the railspective. There is certainly room
.road fuel market due to the heavy
for optimism in the solid achieveand gtm accelerating trend toward
ments of the last year or so. But
the achievements have been mod-
eount^,
the Materials
as
actor^andthe E x per 1 m
Breeder Reactor,
of great
in the simplest and most economireadily cited: Underground gasifi- cal manner within the bounds of
habits is to indulge in wide swings
tbe coaj industry dedicated to the cation
continuous mining, pipe safety; from the economical standof mood between pessimism and
fuel ag distinguished from chemi- line
transportation and low tern- point—it will be possible to tell
©ptimism, a disposition that pre- cal or
matallurgical use. Broadly perature carbonization.
At least just where matters stand on
vents us from having a true percosts,
months ago." But one of our worst
the
privately owned and the
publicly owned. But I think that
it is equally of interest to all those
p
.,
that
of
•
out
out iy in touch with
from military to land based civilabout 75%
tb
development ctf nuclear power ian application, but I believe that
and of making it in 1950 to
80% or higher in 1975,
_0Dp0rtunites for reducing fuel where as here limitations to direct
contribute significantly to satisfy
with coal which supplied about
£ bv resorting to nuclear fuel carry-over are economic, a brand
©ur overall requirements for electw0-thirds of thermal generation
we
musx not overlook any new approach is desirable. This
trie energy.
in 1950, supplying nearly threeDromising opportunities for reduc- can be accomplished only by a reThe foregoing resume is not inquarters of it in 1975. But the real
ing conVentional coal costs. There search program in which the
tended to suggest that the "curproblem is not going to be to find
are
such opportunities and
the single objective is a non-regenrent optimism" of which Mr. Dean the
large increase in coal that this
tecbnicax problems which must be erative reactor for central station
spoke is wrong. I share his obser- will call for. The real problem is
ration
systems
both the
and
d
echhomically
atomic energy package to see just
what there is in it for peace" does
utility
greater than all the jsing is the one leading to even- which all
parts of our industry
Xf this is a fair description of the
energy generated in the year 1950- tuai successful breeding—the prohave been in continuous
contact.
Drospects for nuclear power, then 195i at all the power stations of
duction in the course of operating Some members
r becomes clear that we should
have taken a more
the British Electricity Authority a
reactor, of more fissionable ma- active role than others. But
contriye for a beaithy balance beserving all of Great Britain, Scot- terial than is consumed. £or unless
tinuously—from day to day almost
tween the hope
and the effort iand and Wales. And this will have a
power producing breeder reactor —all
members, large and small
which we invest on the one hand been done with an economy subis finally perfected, we are left
alike, could put themselves in a
in nuclear development and the stantially in advance of that possiwith the plutonium process as a position
to know
and
h
and the effort that we invest
appraise
ble"anywhere else in the world,
source of byproduct power,
with what was going
on, and each could
Qn
the other in improving the
Thus we look at the immense all the inherent difficulties indi- decide for
itself when and under
techniques by which electric
energy requirements of the United cated earlier in this paper.
what circumstances to
try out or
energy is produced in conventional
gtates
over
the
next 25
years
We need, too, a program of re- adopt new ideas. With so
means<
many
against a background of having search and development in segments of the
industry playing a
nature of this problem can satisfied
increasing requirements straight or non-regenerative re- part
in
technological
developillustrated by the situation in aiso of a
large order of magnitude actors. This in
simple words is a ments a variety of approaches to
t of coak we are not alone in the
past decades while keeping reactor in which fissionable maemed witb fulfilling the ex- COsts
ParrlcluIar Problems
firmly in check—notably by terial in separated or concentrated And because in this was assured,
industry we
ding requirements for.electric
increasing efficiency in transmis- form is utilized to produce heat had a
tradition, almost as old as
energ
between today and 1975.
siGn, in use of materials and in and thus energy. Here fissionable our business, of mutual
sharing of
must
a\So
supply them as utilization of fuel. Our job for the
material is consumed and
only technical and operating expenag
gible
The pMPC future is to
repeat these achieveenergy is produced. Such a pro- ence, we could always count upon
forecagt ig that the total energy to ments at the same time as we
try gram involving
military applica- the essential process of cross ferbe
generated in 1975 will rise to press ahead in the whole field
tion is well on the road to final tilization among the
various diffrom the figure of not quite four
0f energy, including
atomic realization. The submarine reactor ferent
approaches.
actual and in prospect, *bundred billion kilowatt hours in
us quite far removed
1950 t0 i;400 billion in 1975; that
fcom a real solution to the probthe percentage of thermal generalem of producing nuclear energy
tion will increaSe from
perience,
objective^ is de-
sirable from the standpoint of the
agencies
demonstration of the condition of
it wiU utiiize annually-a quantity
suppfy fn still later periods.
believe that this
wlth
^electric
nuclear
Thursday, October 23, 1952
.
^
^^
^carr^ut by the ^e^^^velop-
itscontractorsandthe
veys are designed to determine the
therefore, to think of byprod- next 25 years. Rather, even assumpower supply of the possibilities of combining plutopower
plants being
.pg we bave good luck, we are united States can be cited than
niUm production with power prodeveloped other than on the very
likely f0 learn only that a begin- ihe fact that wben the
present ex- duction. While encouragement
exceptional basis of long-term
ning can be made in the next 25
pansion program of the Atomic should be given to explore all
government commitment to buy
yearg wbicb Can make significant
Energy Commission is completed, promising roads, undoubtedly the
the plutonium at a fixed price or
contributions to economical power
oct
.
commercial
Now I want to comment on the
^
manifesting themselves
with which
a
of
energy
price of coal,
in the produc-
element
rost Gf
and
problem
ing
time when tremely
.
Dean of the Atomic Energy Commission
a
little
a
^ thg period which the
guaranteed by them to t
g
f
electric PMPC
under, overall
report took account—the
^equ rementfor^ e ^ PMPCreportahead
be made to fulfill tbose retire-
statement
ment
rise of
and the
ing.
be made to realize
government
a
a
per^iv^i^ tKm cost of ^ecmcity,^
possible to relate
overall prospects for supply-
ance
for the interesting and atprice tractive investigations in relation
wholesale
to produce
.
;inn
price
our
than 150%. In the
the
So that at
^sed
rnal
hfchief
.
Viewedinthis nersnective it is
.
petro-
coal
and money for improving
energy
investigations
;nerg requirements are in other fields which promise more
rapidly, the proportion immediate returns and on
a
.
much
on
^
market
plutonium is evidenced by the
assuring
more
experienced
£& ?t|
b^^uhctCdepeends°Th™'difficulty ^he recently completed study of
of
bituminous
decade
came
it so often is, for
of triumph that
justified
y
coi^iac s,e vaue nuc and po ld
ear shou d
becomes questionable
unless it has been
a
as
^
ceases or
of the power
pluto-
for
market
wentuo
in crude
150%
jn'
leum
100%
be
be
the metal
roughly a 45%
anthracite'
FljlfllviA PaUTAY
f ..
of the
means
AT
III L16CII1C ITOWvl ^dex
.
because the economics
power
rise in
nrice of natural gas; 125% in
the
13Cv 01
*
In
was
1940-1950
decade
the
fuels
there'
6
page
r
.
-
time,
important
project.
No
Finally,
as
a
utility
executive
and with the natural direct interest
in
this
subject which such
a
position creates, I feel it is important that
measures
be devised to
bring the entire electric utility industry into closer contact vnth
what
is
going
on
in
about the
the
new
responsible
other
which,
tional
field of
person
technology,
complains
security restrictions
special conditions
for
good
policy,
reasons
and
with
of
na-
our government has
had to surround the atomic
-
enerev
a*
Rr°g,r*m\^
notwithstanding
this field. I these -difficulties ' which stand
in
Volume 176
Number 5162
.
.
The Commercial and Financial Chronicle
.
(1553)
the way, we need to find
means
of
tween the Electric Power
continuing the healthy conditions
Industry
to make
and
the AEC. That report
pro¬
posed, among other things, that an
my industry and which have been Industrial
Advisory Committee be
indispensable to technological set up to create
adequate contacts
progress. At least, if we cannot between the atomic
energy pro¬
preserve in this new field exactly gram and the electric
utility sys¬
those
conditions which
fostered tems. We
thought that such a com¬
our progress in the
past, we need mittee would help solve the prob¬
to find adequate substitutes.
lem of bringing all of the
separate
which
have
heretofore
existed
in
A
start
in this direction
has
been made in the
survey projects
for nuclear reactors,
already
ferred to.
These
broad
re¬
representation
on
a
Whyte
opinion,
my
By WALTER WHYTE =
front
iront.
last sequently
If
recently
find
forum to express its inter¬
the subject and make its
try. Not long ago the
Atomic
Energy Commission announced a
willingness to consider additional
study
projects along the same
energy
lines.
such
But,
represent
rection,
while
these
start
a
they
in
are
experience available to the atomic
activities
the
program. We
re¬
ing of
technical
possibly take part in this kind of
that such
work and there is
the
for the rest of the
come
effective way
no
limitations
intimately and currently in¬
ments.
v
of
Related Problems
have
related prob¬
lems: How to bring all the
sepa¬
rate units of the
industry: com¬
pletely into this,new.sfield;
of
we shall
apply here,
consistently with security require¬
ments, the tradition which calls
for the fullest
exchange and shar¬
ing of technical experience so thai
industry
can
can>contributeto^ tfre ad¬
How to
vances.
assure the govern¬
ment which has and will continue
to have a dominant voice in
this
field the benefit of the full
experi¬
of
ence
this
relevant
with
industry which is so
things connected
development. In this
all
to
power
last
aspect
speaking
need
of
of the
particularly
the
atomic
gram to make full
of
knowledge
which
problem
use
I
am
about
the
energy pro¬
of that body
and
experience
call
we
utility economics
which has been an
important
and
function of the
industry's manage¬
engineering personnel in
ment and
the
decisions
which
have
to
be
made
constantly in expanding and
maintaining power resources and
It
is
that
a
worth
number
introduction
They
can
send
selected
and
to
observe
of
to
the
of
some
subject.
them
employees
to
do
the
Atomic Energy Commission's Oak
Ridge School of Reactor Technol¬
And recently arrangements
ogy.
have
been
some
under
to
way
of the utilities who
direct
enable
not
were
participants in the AEC
actor surveys to
to such surveys
than
to
a
of
other
that
so
at
least
strongly,' however,
that
ress
in
to
our
exclusively
ures
the
all
the
industry
and
which
technological prog¬
industry if we, rely
upon
are
to
still
as
events, if
most
of
we
to make
are
experience
our
the limited
now
meas¬
available. We
need, in addition, instruments and
In what I have said this
for
nuclear
through the
power
of
eyes
as
ex¬
ecutive.
That is to say, one who
is concerned with the question be¬
plans
his
of
cause
the overall and the de¬
tailed aspects of the reactor
pro¬
gram. We need instruments and
organization which
ization
to
will facilitate
share
will
energy
and
in
that
program
and
help
and make effective in
terest
experience.
instruments
which
our
of
the
organ¬
develop
the
of
responsibility
system
with
interest
in
the
ture
in
new
always being
of his
ma¬
points of vantage would
describe
the
terms.
in
perhaps
different
1
balanced
and
must
Well,
the
Such
for
Cooperation
be¬
,
less
attention
1
that
follow
get
does
the
*
the
but only that
ergy
absorbed
in
thinks
low
that
cost
we
best
be
done
to
time.
would agree that
few
So what you
one stock
S|«
nearly
as
which
other
possible
our
industrial
like
week
you
saw
fields
has
in
pros¬
pered.
perhaps the most severe
break
you've * witnessed in
(Special
LOS
C.
depression" which I think
to
The
Financial
ANGELES,
widely advertised as the
speeches of the two Presiden¬
»As weakness
developed in a stock, it
brought in liquidation. This in
Chronicle)
Calif.—Elmer
turn
attracted
new
liquida¬
added to the tion and so it went. The com¬
Crowell, Weedon & Co.,
ing "depression" was the ac¬
Spring Street, members
tive reason and the
declining
of
the
Los
Angeles Stock Ex¬
market was the
change.
motivating
Ernst
staff
has
been
of
650 South
one.
*
Ferris to Admit
WASHINGTON, D.
ner
in
Ferris
Building,
York
\
of
the
New
Washington Stock Ex¬
on
Oct. 30.
*
Now what
part¬ from here on?
Co., Washington that
members
and
changes,
&
a
f.ww "
c,
of
a
we are
bear
more,
Canadian
Government
the
wheat
farmers
are;Y
their
sales
bumper
had
receipts
crops are
their
on
lower than they
anticipated.
Per
bushel» Canadian funds.,
crop
they
see
of 650 million
less
than it would have brought
had the Canadian dollar been at
par#
much
The
provided
to
boost
Canada's normal domestic wheat
realization
has
tat
come
Canadians who accepted the
premium as an unqualified bless¬
many
ing that the exchange rate of
Canadian currency has little influ¬
ence
on
world prices since the
,
requirements
United
command in setting the price. Tim¬
result is that when the value of
are estimated at
160,000,000 bushels for this year, leav-
728,100,000
If
year
the
ago,
in the first throes
market,
to about
est in
strong
rally is quite likely. In fact
the rally can be strong enough
and
exports
as
World
a
run
wheat
production
to
the
for
Canadian
of
Statistics, will be at
7,150,000,000 bushels, well up from
6,480,000,000
last
1935-39 average of
"A
States
,
.
dollar
...
still
xu
holds
.
.the Uraied Stat?s doIlar falls
*erm® .of
™
currency .the
Canadian exporter gets that much
ess*
years.
according
Bureau
may
370,000,000 bushels, larg-
recent
1952,
near-record
year
and
the
6,020,000,000.
harvest
is
re-
Miss.
Valley IBA Group?
Hospitality Room
ST. LOUIS, Mo. —The Missis¬
sippi Valley Group of the Investment
Bankers
Assn. of America,
members, of which EdBureau, "reducing import re- ward D.
Jones, Edward D. Jones
quirements for this traditionally &
Co., is Chairman, will as usual,
deficit area at the same time that
as they have for the
past 33 years,
the exporting countries of North
maintain a hospitality room on the
ported for Western Europe," said
St.
Louis
the
are
"Though
harvesting record
or
crops.
record
a
crop
is
re-
ported for Asia, substantial imports will again be needed, especially in India, where the wheat
crop
and
was
reported below average
current
a
to the
scarcity of rice adds
Wheat
crops
are
tries, totals this
at
also heavy
year are
Canadian Far West, the
turns
from
.
this year
The
Mississippi Valley
Group will also maintain Suite 446
in
the Hollywood Hotel, Hollywood, Florida, from November 30
to December 5, from 10:30 p. n>.
every
as
.
grain re-
expressed, how-
,
n
Frankenbush Partner
estimated
will exceed those
been
Harry Thies.
.
Lisette
Brennan will
become
.
-
at
partner in Frankenbush & Co., 52
Wall gtreetj New York City, members
has
night. Genial hosts will
usual, Messrs. Kelton White
on
in an(f
oil.
Fear
Florida.
coun-
two billion bushels. In the
near
special I. B. A. train leaving Chi—
cago and St. Louis for Hollywood,—a*4
be
food problem."
the United States. For both
of
the New York
Stock
Ex-
change,
on Nov. 1. Paul Saxl will
in Canadian quarters that all retire from the firm on Oct. 31.
this wheat is much too much; that
there is going to be trouble disJerome Melniker
posing of it, that storage facilities
will not be enough and that it was
Jerome Melniker,
se£lcT
,,,nrsp
uv
ctppi strike
as
Jerome Melniker & Co., New
ever,
„j.
ill
f
steel
thP
?ndustrv
hnats
?et..h0 iron ore I, ?!!
fL°„ i
down
enough
t!^
to
to
hrinf?
keep
plants going through the winter.
However, in the long
dian
a
export
carryover
the
be expected
Well, assuming
for
Canada
much wheat this
year as she did
*
can
'
bushels, is worth about $50 million
,
no
m
C.—George
Ferris, Jr., will become
that
of
that as a result of the
premium on the Canadian dollar
the Western
sales.
was
as
tial candidates.
Crowell, Weedon Adds
is
sell
Canadian
fjnds this unpalatable. As
shipping bottleneck.
Every effort is being made by the
what
was
our
those
,
true
and the Western Canadian farmer
crop
,
is
same
Hemisphere,
finding
$1-71
current
'
near-record
im¬
technology
a
stocks^ can 1952-o3
be expected
of the
.
America
*
work under conditions
under
over
end
there
weeks
many months.
At the same
efforts are most likely to succeed
time
you
must have read
to the extent that we are able to
about the "coming business
conduct the
as
by
The
states,
f.o.b.
Fort
William.
This, at current Canadian exchange
rates,
represents, about
announced
exceed
increase
carryover.
decline in
*
I should expect
energy.
we
has
exports
undoubtedly-can
again, or even
*
past
so
Last
?y0l'SUW2US
Canadian Bu-
The
grain crops there have been
international wheat
agreement good quality wheat is
sold at $1.80 per bushel, United
T1S~
and
in
a
group with accompanying
declines in other stocks or
overlook
shorter term needs for
our
too that
can
become
we
that
it
en¬
nlgn
,
who
shall make groups.
we
great mistake if
a
atomic
some
,
liquidating something else at
was a
5
as
the
Under the
■jwnlmi ? ^ exP°r^d about
357,000,000 bushels of wheat
been a little
original
buying without some compen¬
satory selling, the result being
a
sloppy, desultory market.
same
available
because
year
ing
who
*
For
current
fthe. Uni,ted
™
year.
has the courage to leave the
crowd
unless
the
at
crowd
one
the
wheat
Statistics
carryover
in the stock
Yet it is the
Southern
in
9,
buying tickets
or
better.
reports
of
too late.
the
1952
surplus
^i?rievl0^ rin^o
407,600,000 bushels set
1928-
instead
what to
was
of
k .?v5
crops
of
leau
normal.' 'Everybody
hit show
market.
integrated the
meeting our saw
to
.
the break and
are
end
The
year.
any
behavior isn't unusual;
a
the
last
as
to
is
*
you saw
chances
at
wheat
wheat
*
.
great
the
of
for export and
carryover this year
estimated at about 728 million
a
overall energy requirements. This
or
is not to propose that we should
creating
such instruments and organization
was
visualized by
the Ad Hoc
crop
that
be
with the program for
M.
mech¬
wheat
buying is done it await
*
sale
According
Ottawa, Canada faces prospects of a big pile-up of unsold
expect, however, Even
the investment
trusts
that all would agree that the pro¬
didn't do any
buying without
gram we pursue for the develop¬
ment of nuclear power needs to be
S., if these countries b'ay
already stated, European demand
from
should
I
picture
as
for grain is not expected to be
storage
and
space
produce.
pres¬
suggested that if
of
payments situation—
problems involving both
market break.
a
the
Others with different
years.
atomic
concerted
A year and a half ago a
anism
for
assisting in
on
ent and
which
improvements
the U.
or
this
of grain and other food
give to the Canadian bal-
ance
for the
market.
in¬
own
knowledge of the industry.
Committee
reaction
he is connected and because of his
cerning
efforts
pointed out the dangers of
seen
utility
a
chronicle. They are presented
those of the author
only.]
matter,
whole, Canadian agricul-
results
crops
though at the same time it
cautioned against
charging in
on
an
emotional
basis.
It
evening whether it's in
I have tried to talk about the
pros¬
pects
under¬
bullishness,
plish the purpose. As of today, we it's quite
have only made a small
to
beginning. likes
which can facilitate
efforts to get current informa¬
tion in the most reliable form con¬
need
equanimity.
be
keep one's
For the past few
we
our
We
one
your list to see
nological advance in other fields,
out of before it
must either find devices of this
kind or better devices to accom¬
another
is
rally.
a
[The views expressed in this
article do not necessarily at any
txme coincxde wit1* those of the
fore-
exports
is to
if
considering any new buy¬
ing you hastily went through
bring to bear in this new field the
factors which have promoted tech¬
organization
our
must
stood
of
and
the
anticipation of
By WILLIAM J. McKAY
On the
*
pattern that
effective
more
in
in
now
if
or
tural
whole,
a
of contact would evolve.
measures
At
re¬
assign personnel
we
shall not accomplish our
objective of preserving the condi¬
tions which have heretofore been
favorable
more
measure
already available.
hope is that through such
committee, broadly representa¬
men
feel: very
anything
modest,
those
be
already.
*
the liquidating. It might even be
jump^good trading technique to buy-
Yet, such reactions, as dis¬ record level. This year are at a British goods in large enough
poses problems,
quantities. Indeed, Britain has alquieting as they are to sit which are of a serious nature,
ready contracted with Russia for
through, are part of a market despite the favorable aspect large wheat, payable in
sterling. As
But the
prove
I
itself
another
add
pay
in other systems could
become educated.' >
some
is in
group
been identified for all
while
simple ap¬
proaches are already open to all
utility systems in securing a use¬
ful
*
engineering art with which he has there's
networks.
power
ma¬
industry advisory committee
an
tive
profit by the advances gnd so that
such
like that proposed by the Ad Hoc
How
too late
was
any
for
I do not suggest that the device
to assure that
each
and
chinery has been established.
several
each segment of the
a
adequate substitute
(
get out;
security require¬
weeks the tone of this column
far, unfortunately,
was of mild
committee nor
Thus
neither such
We
experience,
committee could help
government find means for
a
industry to be¬ achieving this objective within the
formed about it.
it
to
thought that
committee would help as¬
in this new field the contin¬
uation of the tradition which calls
for the fullest
exchange and shar¬
stricted by the fact that
only a
limited number of companies can
time
oils,
Canadian Securities
ginning of the end, and if it
were
a
sure
right di¬
seriously
a
in
est
the
What ran hannpn <;uhWnat can
nappen suo
geo¬
you
sat
through
completed by four quate representation to both the week's
spill your heart must
industrial groups which numbered privately owned and the
publicly have
been
in
your
mouth,
among their members five of the owned power systems, we thought
larger utility systems of the coun¬ that the industry as a whole could wondering if this was the be¬
and
that
volatile ones, will
up
again.
Such stocks like
Richfield, Continental, Cities
Service and Houston, will, in
Says—
==
graphic basis and by giving ade¬
undertaken
were
example,
more
units of the industry more com¬
pletely into this field. By giving
to Offhand I would
suggest that
the next rally — and I think
there'll be one—be used for
run
may even convert
bears into bulls. I
think, for
Markets
Walter
bear
many a
it
cover;
Tomorrow's
37
grain
will all be
can
can
the
surplus.
been in poor
Cana¬
traders say the crop
marketed, since Britain
absorb
Britain
run,
York City, and a member of the
New York stock Exchange, ended
his life Oct. 15.
But
Mr. Melniker had
health for
some
time.
Leeds Johnson
Leeds
son
&
only buy from Canada Oct. 13.
Johnson, partner in JohnSouthwood, passed away
#
'
C3
The Commercial and Financial Chronicle
(1534)
.
.
.
ADDITION S
★ IN DICATES
in
Now
Securities
Oct.
Inc., N. Y.
(letter of notification)
16
Electric Illuminating Co. (11/24)
shares of common stock (no par) to
subscription by common stockholders of
record Nov. 24 at the rate of one new share for each five
NEW ISSUE CALENDAR
writer—d'Avigdor Co., New York.
October 23,
if Aldens. Inc., Chicago, III.
Oct. 9 (letter of notification) $80,000 estimated amount
of contributions
by employees to Aldens Employees
Profit-Sharing Fund. Office — 511 South Paulina St.,
Chicago 71, 111. Underwriter—None.
★
Equitable Gas Co
iBids
October
Gulf
For working
(10/29)
sinking fund convertible
30, 1962. Price—At par. Proceeds—
capital.
October
iHarriman
by
(White,
terests,
to 11
States
of America and
tificates
and
for
cause
issued.
such
new
division
Jefferson
Electric
include:
Co.)
&
the
Com.
Gardiner, Ltd.)
..Common
&
Inc.)
Co.,
Class A & B
Common
Davis &
October
(C.
29, 1952
Debentures
&
Anheuser-^usch, Inc.
(Stifel,
Nicolaus
&
Common
Reinholdt
Inc.;
&
and
Gardner
October
Blair Holdings
(Allen
&
(William
R.
Co.
&
and
of
notification)
Price—$10
share.
per
shares
4,500
Proceeds—For
of
Hammill &
Shearson,
November
common
expansion.
.
Crown
Co.)
filed
356,717 shares of
common
cer¬
&
—Debentures'
Gardner
;
per
and Bosworth, Sullivan &
Co.;
Seiberling Rubber Co
(Blair,
Hibernia
National
To
step
common
stock (par $4)
stockholders—Biytn
to
(Bids
up
Underwriter—None. Tobacco & Allied
Stocks, Inc.
(owner of approximately 55% of the present
outstanding
stock) will purchase any unsubscribed shares.
Ltd.,
Price
To
Approximately 64.48
acquire
leases
and
for
writer—None.
To be named
★ Carver Oil
&
Oct. 3
mon
common
stock
cents per share.
(par
Proceeds
15,
to
be
November
(Offer
to
1952
Bonds
Uranium, Ltd.
to
Bond
17,
1952
be
(Nev.)
Share
18,
Co.
November
1952
Electric
to
preferred stock (par $100), 7,000 shares of common
stock
mon
class
EST)
24,
..Common
underwriting)
Bonds
nocn
EST)
Oct. 22 filed
to
be
(Bids
Service
to
for
par
Charlotte
Bldg.,
N.
1.
C.
be
covering
a
number of shares
newly created series of its special stock. Proceeds—For
Underwriter
—
Kidder,
Peabody
Co.*
tk.
(James)
19
vertible
Engineering Co.
100,000 shares of con-^
5% preferred stock to be offered for subscrip¬
(letter
of notification)
31.
common
one
share
shares held; rights to expire on Oct.
Price—At par ($2 per share).
Proceeds—For general
corporate purposes.
4, Calif.
Office—58 Sutter St., San Francisco
Underwriter—None.
(James)
Engineering Co., San Francisco,
»
Calif.
Oct.
Debs.
invited)
December 15,
New Orleans Public
Wilder
amendment
an
investment.
16
(letter of notification) 60,000 shares of 5% con¬
vertible preferred stock (par $2). of which 30,000 shares
are
*
(about
share for the common voting
Proceeds—For working
yet undetermined of Diversified Growth Stock Fund,
★ Dole
1952
England Telephone & Telegraph Co
(Bids
per
stocks).
★ Diversified Funds, Inc.
for each 10
Illuminating Co
one
New
common
tion by stockholders of record Oct. 6 at rate of
1952
stockholders—no
December 9,
capital. Underwriter—West & Co.,
Jersey City, N. J.
B
Office—701
Dole
Gulf States Utilities Co
com¬
(par $10) and 2,000 shares, of class B com¬
(par $10). Price—At market
Underwriter—None.
Sept.
Common
(Bids
East 42nd St.. New York 17. N. Y.
& Co., New York.
New York.
19, 1952
a.m.
November
(Offering
Suite 839, 60
★ Dickson (R. S.) & Co., Inc., Charlotte, N. C.
Oct. 15 (letter of notification) 250 shares of 5% cumula¬
a
Debentures
Duquesne Light Co
Cleveland
rehabilitation
stockholders)
PST)
a.m.
11
Price—50 cents per shait
Pro¬
and. dev«» opment program.
cent).
one
invited)
&
8:30
—
capital.
Bonds
November
(Bids
(par
ceeds—For
preferred stock and $25
Common
Electric
Gas
cent). Price—121/2 cents per share.
For acquisition of
properties and working
Peak
voting stock
invited)
Pacific Telephone & Telegraph Co
Under¬
of
Offering—Expected before Oct. 15.
Devil
as
(par $1).
Proceeds—
corporate purposes.
by amendment.
Co., Inc.
(letter of notification) 2,393,600 shares
stock
Inc.)
Toronto, Canada
Sept. 25 filed 1,000,000 shares of
com¬
(par 10 cents).
Price—$1.25 per share
Pro¬
repay RFC loan of $41
an(j for working
ceeds—To
capital.
Office
Common
Co.,
&
Long Island Lighting Co
(Bids
Oils
stock
mon
and
one new
common
Bristol
Kansas City, Mo. (11/1)
$250,000 of 4V2% con¬
vertible debenture notes due Oct. 1, 1962 to be offered
on Nov. 1 for prior subscription by stockholders.
Price—
at par (in denominations of $60, $100, $500 and $1,000
each). Proceeds—For working capital. Office—2210 Cen¬
tral St., Kansas City, Mo. Underwriter—Business Statis¬
tics Organizations, Inc., Babson Park, Mass.
Drug Co.,
(letter of notification)
18
1952
of
share for each 10 shares
Nov. 3. Price—$23.50 per share.
production of Parliament ciga¬
indi¬
one
Clemens E. Gunn of Gunn, Carey & Co.,
Underwriter—Gardner
12,
Detroit & Toledo Shore Line RR
being
stockholders
common
unsubscribed which will be sold to
are
Cleveland, Ohio.
stock
Common
United Gas Corp
on
rettes.
6, 1952
November
Underwriters—Mohawk Valley In¬
Hedges, N. Y.
shares of capital stock
Price—$25 per share. Proceeds—
Underwriter—None, unless 1,000
capital.
working
vidual through
Inc.)
American Trust Co., San Francisco
(Bids
Proceeds
For
tive
vesting Co., Inc., Utica, N. Y., and
Security & Bond Co.,
Lexington, Ky.
held, rights to expire
Co.
Bank
November
(Offering
(letter of notification) $299,000 of 20-year sink¬
ing fund debentures. Price—At par (in denominations of
$1,000 each). Proceeds—To acquire capital stock of the
by
Inc.)
(Scharff & Jones, Inc. and White, Hattier & Sanford)
Oct. 10
record Oct. 20 at rate of
Co.,
______Debentures
Rollins &
Co., Cayuga, N. Y.
Oct. 6 (letter of notification) 3,000
April 7 (letter of notification) 600,000 shares of common
if Belco, Inc., Cleveland, O.
Benson &
Debentures
November
Kaplan & Edelstein, New York. Underwriter—None.
★
Co., Inc. and Lazard Freres & Co., both of New York.
March 21
capital.
stock. Price—At par ($10
per share). Proceeds—To drill
a well and
for working capital. Address — c/o
Young,
be
Deerpark Packing Co., Port Jervis, N. Y.
(letter of notification) 230,000 shares of
5, 1952
Refining Co._
Boettcher &
common
if Beaver Dam Petroleum Corp. (Pa.)
Oct. 14 (letter of
notification) 3,000 shares of capital
Oct. 2 filed 39,738 shares of
offered
for
subscription
underwriting)
(Peters, Writer & Christensen, Inc.; Sidlo, Simons, Roberts & Co.;
manufacturing plant, and for working
Underwriter—Marvin & Co., Philadelphia, Pa.
Coleman & Bell Co.
Common
stockholders—No
to
share. Proceeds—To build
record
3, 1952
November
Frontier
★ B. B. S., Inc., Philadelphia, Pa.
Oct. 17 (letter of
notification) 150,000 shares of
(par $1). Price—$2
(Offering
and
*
*
«
Dow Chemical Co...
Co., Inc.,
Newhard, Cook & Co., all of
and
St. Louis, Mo.
November
,
—
stock
&
Sept.
(Offering to stockholders)
Price—To be supplied by amendment. Proceeds—To
tain selling stockholders. Business
Manufacture
sale of beer.
Underwriters—Stifel, Nicolaus &
Reinholdt
1, 1952
Drug Co..
(10/29)
stock (par $4).
(10/27)
filed
3
shares
Co.j
.Preferred
Staats
association. Underwriter—None.
Corning Glass Works, Pittsburgh, Pa.
Crown
(letter
10
★
rights expire Oct. 31.
Debentures
-
Whiting Corp.
Anheuser-Busch, Inc., St. Louis, Mo.
Oct.
—Wholesale purchasing
to be offered for subscription by stockholders
of record Oct. 1 at rate of one share for each three held;
30, 1952
Freightlines, Inc
Underwriter—None.
★
to be offered for sale to members and others. Price
face amount. Proceeds—To build plant.
Business
(par $5)
Newhard, Cook & Co.)
Garrett
subordinated certificates of indebted¬
25-year 5V2%
Inc.)
Co.,
_.
Co.,
Kansas
104,104 shares of common stock (par $5).
supplied by amendment.
Proceeds—To
selling stockholders.
Underwriters — Harriman Ripley
Inc
Pistell
K.
Cooperative Association,
City, Missouri
Sept. 24 filed $3,000,000 of 10-year 4V2% subordinated
certificates of indebtedness, $6,000,000 of 20-year 5*/2%
subordinated certificates of indebtedness; and $1,000,000
Oct.
Co.)
Calif.
stock.
Consumers
Cowles
in¬
if Andrews Building Products, Inc., Santa Rosa,
7
do
ness;
Co
H.
To
—At
EST)
a.m.
for the
Price—Of debentures, at par. Proceeds—
erect plant. Office—207 Independence Bldg., Colora¬
Springs, Colo. Underwriter—None.
of
28, 1952
11
Allpark Finance Co.,
Corp.; and R. Stanley Dollar.
Oct.
(latter to be issued to induce sale of cer¬
stock
Price—To
Bids—To
Dollar
★ Colorado CO2 Corp., Colorado Springs, Colo.
Oct. 14 (letter of notification) 250 participating produc¬
tion certificates of $1,000 each and 50,000 shares no par
_Common
Co.)
Lines, Ltd
(Paul
equally between the parties
will
Freres
—
and George R.
(Bids
certificates for such shares of stock to be
bidders
&
Eberstadt
American President
a.m.
Probable
Lazard
and
Inc.
October
(EST) on Oct. 28. If no bid is re¬
ceived which at least equals the minimum price of $14,000,000, the trustee will surrender and deliver the cer¬
up
Weld & Co.
(F.
be received by The Riggs National Bank of Washington,
D. C., as trustee under a "Settlement Agreement" be¬
tween the United
Common
Co.,
&
Underwriters
competitive bidding.
property
Underwriter—None.
corporation).
Smith-Douglass Co., Inc
American President Lines, Ltd. (Calif.)
(10/28)
Sept. 4 filed 100,145 shares of class A stock (no par)
and 2,100,000 shares of class B stock (par $1). Proceeds
—One half to go to the Treasurer of the United States
determined
Ripley
iGraham
Price—$1.25 per share. Proceeds—For equipment
and working capital.
Office—324 South Main St., Salt
Lake City, Utah. Underwriter—None.
be
27, 1952
Redwater Utilities Holdings Oil & Gas Ltd
stock.
—To
additions.
common
Pennsylvania Citrus Groves, Inc
Pacific Oil Co., Salt Lake City, Utah
(letter of notification) 240,000 shares of common
and the other half to the Dollar interests.
Common
Corning Glass Works
&
★ American
Oct. 14
about Dec. 19. Price
supplied by amendment. Proceeds—For
be
To
tificates and for miscellaneous services performed
Office
Pistell
K.
24, 1952
(Peter Morgan & Co.)
.
—
Houston, Tex.
Under¬
Co., Inc., New York.
The pro¬
posed offering of preferred and common stocks have
been withdrawn from registration.
writer—C.
invited)
Sulphur Corp._______
Allpark Finance Co., Inc.
Aug. 28 filed $500,000 of 6%
debentures due June
..4--Debentures
_
be
to
for
shares held; rights to expire on or
1952
:
offered
be
Under¬
capital.
working
and
expenses
ISSUE
REVISED
Oct. 22 filed 557,895
6,000 shares of common
10 cents). Price—$5 per share. Proceeds—For
developmental
ITEMS
•
PREVIOUS
★ Cleveland
★ Air Springs,
stock (par
SINCE
Registration
23, 1952
Thursday, October
to be issued
by James D. Dole
as
"gifts to children"*
at 25 cents per
1952
Inc
Bonds
share, and 30,000 shares are to be offered
by Alexis E. Post for cash. Underwriters—J. Barth & Co.
and
invited)
The Broy
Co., both of San Francisco, Calif.
Dow Chemical
Co., Midland, Mich. (11/3)
Sept 23 filed 625,000 shares of common stock (par
if Chemi-Cote Perlite Corp., Phoenix, Ariz.
to
Oct. 9
(letter of notification)
scription by
Price—At par
at
138,135, shares of common
($1 per share). Proceeds—To com¬
requirements. Address — P. O. Box 5187,
Phoenix, Ariz. Underwriter—None.
stock.
plete
plant
be offered
rate
about
the
July
25
filed
debentures
New York
Boston
Philadelphia
San Francisco
Private IVires
Pittsburgh
to
all
offices
Chicago
Cleveland
-
amendment.
mouth
$2,500,000
due Aug.
Inc.
of
26.
10-year
1, 1962.
convertible
junior
Price—To be supplied by
Proceeds—To pay notes issued to the Ports¬
Corp.
Underwriter—Halsey, Stuart & Co.
Inc., Chicago and New York.
postponed.
Offering
—
Temporarily
follows:
share for
new
shares
and
About
$5)
420,000 shares for sub-'
stockholders of record Oct. 21. 1952
for
its
each
50
shares
held, and
subscription
subsidiaries
by employees of
and affiliated corrW
The offering will onen Nov. 3 and close
Price—$31
rate purposes.
on
Nov,
share.
Proceeds—For general corpo¬
Underwriter—None.
per
Duquesne Light Co., Pittsburgh, Pa. (11/19)
Sept. 30 filed 250,000 shares of common stock (par $10),
of
Steel
one
205,000
company
paries.
Cincinnati Enquirer,
of
as
common
which 80,000 shares will be offered
170,000
new
shares
by
construction.
the
Philadelphia
Underwriters—To
competitive bidding.
by company and
Proceeds—For
Co.
be
determined
by
Probable bidders: The First Boston
176
Volume
Number 5162
.
.
The Commercial and Financial Chronicle
.
(1555)
\
i
Corp.; Lehman Brothers; Kidder, Peabody & Co., Merrill
Lynch, Pierce, Fenner & Beane and White, Weld & Co.
(jointly); Kuhn, Loeb & Co. and Smith, Barney & Co.
if Greater
Corp.
Bids—Expected to be received
up
to 11
Chemical
Co.,
—For working
Salt
Corp., Long
(letter of notification) 299,900
stock r(par--JO ^eiate)^,, Price—$1
per
For expansion and working capital
Co., Elyria, Ohio
(letter of notification) 2,122 shares of common
(no par) and 5,600 shares of 5% preferred stock
17
(par $50). Price—Common stock at $7,476 per share, and
par. Proceeds—For new construction,
'preferred stock at
ferred Stockf
-
None.
if Family Weekly Magazine, Inc., N. Y.
»Oct. 13 (letter of notification) 40,000 shares of class A
stock
Island City, N. Y.
ments
20
be
to
shares
offered
of
limited to
stock.
i
—
of $750
For
per
unit
capital.
Office
.if Farm Equipment Acceptance Corp., Peoria, III.
10 (letter of notification) 2,000 shares of common
.working capital.
111.
$60
—
share.
per
Proceeds
.
Association, Los Angeles,
Sept. 25 .(letter of notification) 2,000 shares of common
(par $1).
Price—To be supplied by amendment.
'general corporate
ation
■
Trust
—
$12
purposes.
Proceeds—For
short-term
.
pay
—
To
repay^
6
500
shares
stock.
Proceeds
—
working
capital.
of
Mohawk
—
For
Francisco.
Address—c/o The Corpor¬
(on
the
San
stock
Francisco
(par $1).
Stock
Ex¬
Bechtold, deceased).
Underwriter—None.
Office—San
Fair
pner,
shares.
Forming Machine Co. of America, Inc.
notification) 175 shares of common stock
(par $1) being offered for subscription by stockholders of
Sept.
23
at rate
of
one
new
shares held; rights expire Nov. 10.
'
Drive,
share
for
Price—$200
each
per
Feb.
par
Israel
Investment
Corp.,
stock. Price—$1
Salt Lake City,
315, Salt Lake City, Utah.
•
at rate
of
expire
Oct.
and
to
one
share for each
30.
reduce
two
Proceeds—For
bank
loans.
Street, Norwich, N. Y.
expansion
Office—17
facilities
Railroad
Underwriter—None.
if General
Oct.
Tire & Rubber Co.. Akron, O.
(letter of notification) 6,861 shares of
(par $5) to be offered in exchange for
14
stock
shares of
Tire
at
rate
of $1.25
per
Underwriter
—
Israel Securities
Long Island Lighting Co.
additional 107,550 shares have been
and will be issued in con¬
nection with expansion of ammonia plant.
The remain¬
ing shares will be offered for sale primarily to farmers
and
farm
an
as
of Aug. 28
Price
groups.
construction.
—
At par.
Proceeds
For
—
new
Underwriter—None.
Montana Basin Oil Corp.
(N. Y.)
Sept. 19 (letter of notification) 300,000 shares of
(par 10 cents).
Price—$1
development
For exploration and
—Aetna Securities
share.
per
common
Proceeds—
Underwriter
expenses.
Corp., New York.
Multiple Dome Oil Co., Salt Lake City, Utah
150,000 shares of common
Sept. 8 (letter of notification)
stock.
Price—At
market
(approximately 10 cents per
Proceeds—To George W. Snyder, President. Un¬
derwriter—Greenfield
&
Co., Inc., New York.
if Newton-Conroe Oil Corp., Conroe, Tex.
Oct. 9 (letter of notification) 1,000,000 shares of common
stock (par one cent). Price—30 cents per share. Proceeds
—To purchase wells and for equipment. Underwriter—
.
if North American Acceptance Corp.,
Bryn Mawr, Pa.
Oct.
15
stock
(letter of notification) 40,000 shares of class A
(par $1). Price
Colby
Corp.,
G. Kuch
— $2.50
per share. Proceeds — To
selling stockholder. Underwriter—H.
the
& Co.,
Philadelphia, Pa.
if Olympic Radio & Television, Inc.
Oct. 14 (letter of notification) 35,919 shares of common
(par $1) being offered for subscription by common
stockholders of record
for each
Oct. 20 at rate of
11 shares held
one
new
share
oversubscriotion privi¬
lege); rights to expire on Oct. 30. Price—$8.35 per share.
Proceeds—For working capital. Office—34-01 38th Ave.,
Long Island City 1, N. Y. Underwriter—None. Fox, Wells
& Co., owner of approximately 24% of outstanding stock,
will purchase any unsubscribed stock.
(with
an
•
'Inc.'
Probable bidders: Halsey, Stuart & Co.
& Co.; Smith, Barney & Co.; Blyth
Co., Inc.,-and The First Boston Corp. (jointly). Bids—
Tentatively-^ scheduled to be received at noon (EST)
Nov. ,17^>^'-
"-
brokers
(Oscar) & Co., Inc., Chicago, III.
(letter-of notification) 20,000 shares of common
stock (par $10) to be offered for subscription by certain
employees and officers of the .company and its sub¬
10
Price—$15
common
per
share.
Proceeds—For working
Office—1241 N. Sedgwick St., Chicago, 111.
McCarthy
Un¬
common
stock
the
New
None,
York
sales
to
(par $4).
Getty, Presi¬
be
handled
by
Stock Exchange.
Paradise Valley Oil Co., Reno, Nev.
Aug. 20 filed 3,000,000 shares of capital stock. Price—
(10 cents per share). Proceeds—To drill six wells
subleased land and for other corporate purposes. Un¬
derwriter—None, with sales to be made on a commission
basis (selling commission is two cents per share). Of¬
fice—c/o Nevada Agency & Trust Co., Inc., Cheney Bldg.,
139 N. Virginia St., Reno, Nev.
Penn-Allen
common
cents). Price—$2 per share. Proceeds — For drilling of
exploratory wells, acquisition of leases and for general
stock
(par $10)
shares
and
two
$10) and 7,432 shares of common
offered in units of five class A
common
shares.
Price—$70 per unit.
(par
to
be
Proceeds—To construct
ing capital.
Pa.
•
a
television station and for work¬
Office—Masonic Temple Bldg., Allentown,
Underwriter—None.
Pennsylvania Citrus Groves, Inc. (10/27)
(letter of notification) 100,000 shares of common
Oct. 8
plant,
(par 25
Broadcasting; Co.
18,580 shares of class A
Sept. 30 (letter of notification)
stock
(Glenn), Inc.
June 12 filed 10,000,000 shares of common stock
on
—
At par
stock
•if Mayer
Oct
Corp.
100,000 shares of
Underwriter
dent,
Ch-- Langley
&
on
Pacific Western Oil
Aug. 5 filed
on
(11/17)
derwriter—None.
are
issued, and
subscribed for
Price—At the market. Proceeds—To J. Paul
Oct. 15 filed $20,000,000 of first mortgage bonds, series
E,
due 1980.
Proceeds—To repay bank loans and for new
construction.
Underwriter—To be determined by com¬
capital.
share for all shares which
Underwriter—None.
-•
sidiaries.
Crosley Motors, Inc., on basis of one General
for each 27 Crosley shares
tendered, with
multiples of 27.
Corp.,
filed
common
share
cash
3
petitive bidding.
of
Development
imburse treasury for cost of additions and improvements
to plant. Underwriter—Paul H. Davis &
Co., Chicago, 111.
cor¬
East
Washington, D. C.
Mineral
&
Electric Co., Bellwood, III.
(10/28)
100,000 shares of common stock (par $5).
Price—To be supplied by amendment. Proceeds—To re¬
St., Suite
shares held; rights to
and
stock
Jefferson
Oct.
Underwriter—None.
General Laboratory
Associates, Inc. (N. Y.j
Sept. 30 (letter of notification) 7,435 shares of common
stock.
Price—At par ($20 per share) to be offered for
.subscription by common stockholders of record Oct. 15
Services, Inc.
Corp., New York.
Utah
share. Proceeds—For general
per
Industrial
($100 per share).
development of Israel.
100,000 shares of capital
porate ourposes. Office—28 We«?t Second South
Mississippi Chemical Corp., Yazoo City, Miss.
Sept. 29 filed 2,000,000 shares of common stock (par $5),
of which 849,038 shares have been subscribed, paid for
Price—At par
Proceeds—For industrial and mineral
Christensen, Inc.; Sidlo, Simons, Roberts
(letter of notification)
plied by amendment.
Oct. 6 filed 30,000 shares of class A stock.
& Co.: Boettcher &
Co.; and Bosworth, Sullivan & Co.,
Inc.; all of Denver, Colo.
17
&
N. Y.
★ Frontier Refining Co., Denver, Colo. (11/5)
Oct. 16 filed $1,000,000 5%% convertible debentures due
1962.
Price—At par (in units of $1,000 each). Proceeds
.—For equipment and
working capital. Underwriters—
Oct.
Beverly
15
—James T. DeWitt & Co..
.
if General
South
Underwriter—Douglass
working capital. Office—International Terminal, Wash¬
ington National Airport, Washington, D. C. Underwriter
..
Peters. Writer &
Office—119
Beverly
(letter of notification) 300,000 shares of common
stock (par 10 cents). Price—$1 per share. Proceeds—For
Proceeds—For working capital. Office—18 Hamilton St.,
Bound Brook, N. J.
Underwriter—None.
not
_Price—At
shares; and to public, 275,000
($1 per share). Proceeds—For
International Technical Aero
15
share.
Range Mines, Inc., Denver, Colo.
Sept. 3 (letter of notification) 125,000 shares of common
'stock (par $1).
Price—At market (approximately 371/2
cents per share). Proceeds—To Irene F.
Marple, a director. Underwriter—Stanley Pelz &
Co., Inc., New York.
:
17,650
Hills, Calif.
Co., Beverly Hills, Calif.
Front
.
Corp.,
general corporate purposes.
•
Oct. 3 (letter of
/
Corp., Beverly Hills, Calif.
(letter of notification) 299,635 shares of com¬
stock, to be issued as follows; To William Hoep6,985 shares; to stockholders of Soft-Flex Glass
Fabrics
None.
record
Canada.
Morris Cohon & Co., New York.
International Glass
Sept. 22
mon
exploration, development and acquisition of
Underwriter—Brewis & White, Ltd., Toronto,
Names of United States underwriters to be sup¬
properties.
share).
stock
mon
'
'
share for each two shares purchased in
two, three, or
five years, at $1, $2 and $3 per share, respectively. Price
—For 2,000,000 shares, $1 per share—Canadian.
Pro¬
stock
Underwriter—None.
-
Exploration Corp., Ltd., Toronto Canada
filed 2,000,000 shares of common stock, each
share to have attached an "A," "B" and "C"
warrant,
each giving the holder the right to buy one additional
~
(par $1). Price—At par. Proceeds—For in¬
dustrial financing. Office—119 West 57th
St., New York.
Stores, Inc., Philadelphia, Pa.
Sept. 9 filed 100,000 shares of common stock (par $1)
,to be offered to certain employees pursuant to the terms
of stock purchase plan.
Price—$3 below the average
market price for the month in which
payment is com¬
pleted.
Proceeds—For general funds.
Underwriter—
,
Mineral
Co.,
if Industries Funding Corp., N. Y.
Oct. 20 (letter of
notification) 10,000 shares of participat¬
ing preference stock (par $25) and 10,000 shares of com¬
Co., 1004 Second Ave., Seattle 4, Wash. Un-
Greenfield &
ceeds—For
. ,,t
Errol
Calif.
—
^July 29
and gas
change). Proceeds—To selling stockholder (Gwendolyn
MacBoyle Betchtold, as executrix of the last will and
of
Proceeds—For develop¬
Underwriter
15, 1963. Price—At par (in de¬
nominations of $1,000 and $500). Proceeds—For
working
capital.
Underwriter—The Ohio Company, Columbus,
general
Valley Investing
:
Maryland Mines Corp.
200,000 shares of common
testament
$24,000).
debentures due March
Price—$200 per unit. Proceeds—
debt, for new plant and working
market
to exceed
Midcontinent Chemical Co., Grove City, Ohio
Sept. 26 (letter of notification) $50,000 of 5V2% secured
common
Underwriter—
filed
'Price—At
not
ment of oil and gas leases.
Underwriter
stock..
Underwriter
Idaho
June
derwriter—None.
Food
S.
Ohio.
50 shares of common
common
:
share. Proceeds-^ For
per
Underwriter—Gran-
Co., Inc., New York.
Inc., Utica, .N. Y.,
Corp.,
(par $1). Price
of
capital.
Proceeds—For expansion
Seattle, Wash.
Sept. 12 (letter of notification) 24,950 shares of capital
slock
Proceeds
construction.
new
:
To
if Fischer & Porter Co., Hatboro, Pa.
Oct. 17 (letter of notification) 10,500 shares of class A
preference stock (no par). Price—$10.75 per share. Pro¬
ceeds— For working capital.
Underwriter — Hallowell,
Sulzberger & Co., Philadelphia, Pa.
Floseal
purchase four additional
share. Proceeds—To Clifford
amount
share of
Underwriter—Robert Brilliande, dba Hawaii
Underwriting Co., Honolulu, Hawaii.
H.
* Household Service, Inc., Clinton, N. Y.
Oct. 10 (letter of notification)
2,000 shares of preferred
.stock (par $25) and 250 shares of common stock
(par
$10) in units of eight shares of preferred stock and one
derwriter—Lester; Ryons & Co., Los Angeles, Calif.
share.
T.
None.
if Financial Security Life Insurance Co., Ltd.,
Honolulu, Hawaii
Oct. 8 (letter of notification) 40;000 shares of common
per
Honolulu,
AUrpan'! C$20-%per share).
—
'share.
Proceeds—To John C. Tyler, the selling stockholder. Office-T-4680 Wilshire Boulevard, Los
Angeles, Calif. Un¬
Price—$7.50
Ltd.,
if Household Finance Corp.
Oct. 17 filed 60,000 shares of common stock
(no par—
stated value $12 per share) to be offered for
subscription
by certain employees and executives. Price—$28.50 per
:stock
•stock.
offered in units
to
(letter of notification) 25,000 shares of common
(par $2). Price—$7 per share. Proceeds—To Clif¬
Strike, the selling stockholder. Underwriter—
Granbery, Marache & Co., New York.
common
corporate purposes. Business—To engage in oil
business. Underwriter—None.
California
»of business.
warrants
6
ford
Corp., Dallas and'
tSept. 18 filed $1,500,000 of 20-year non-negotiable de¬
bentures due Aug. 1, 1972 and
139,920 shares of common
stock (par $1). Price—$960
per $1,000 debenture, plus
common/stock subscription warrants for the purchase
—At par. Proceeds—To increase
capital. UnderwritersJohn J. Rhodes and James E.
McNelis, officers and direc¬
tors of the two companies.
•
Co.,
Oct.
Oklahoma City
stock
'
and
Price—$19.87V2 per
Strike, the selling stockholder.
bery, Marache & Co., New York.
Hilseweck Minerals
Co., Chicago, 111.
(par 35 cents), the class A stock to be sold only to
policyholders of The Farm & Home Insurance Co.
Price
stock at $6 per share to be
share
shares.
—
Phoenix, Ariz.
.July 7 filed 1,613,168 shares of class A common stock
;(par 25 cents) and 2,744,034 shares of class B common
Underwriters
Co., New York.
(par $10)V.Price: — $50 per share. Proceeds
For
working capital. "Office—35-10 Astoria Boulevard, Long
Island City
-Underwriter—None.
Farm & Home Loan & Discount
Co.,
Farmers
one
if Mid American Oil & Gas Co., Chicago, III.
Oct. 10 (letter of notification)
80,000 shares of common
stock (par 10
cents). Price—At market (at an aggregate
Office—3500 North Adams St., Peoria,
Underwriter—Paul H. Davis &
common
of
pre¬
stock
For
—
Electric
★ Heliogen Products, Inc.
Oct. 16 (letter of notification)
tOct.
Price
of
retire
to
stock
—None/
William H. Marriott, 36 East 36 Street, New York, N. Y.
Underwriter—None.
•.stock {par $50).
&
Proceeds—
and
S.
short-terma riotes'and for
c/o
—
share.
Price
(subscription
to newspaper publishers
working
(F. H.) Co., Hartford, Conn.
(letter of notification) 5,000 shares of common
(par $2) and warrants to purchase 20,000 shares
stock
stock to be offered
for subscription by common stockholders of
record Oct.
3 in the ratio of- one' new share for each 10
shares held.
$130 in debentures and
Price—$150
minumum
a
'only). Proceeds
/
units of
in
Telephone
Offering—Date indefinite.
Sept. 10
common
.(Sjulf SulphurCorp. (10/24)
Sept 8 filed'225,000 shares of common stock (par 10
cents)vvPrice—$8 per share. Proceeds—To pay costs of
Sept. 25 filed 50,000 shares of
instal¬
annual
Uhdffei%riter—Batkin
shares of
;j
Hawaiian
(no par—stated value $1) and $260,000 of
t5% debentures due serially in five equal
Representative—George
Searight, 50 Broadway, New York, N. Y.
WHitehall 3-2181.
drilling 25 test wells and for other corporate purposes.
Underwriter^ReterOMorgan & Co., New York.
,.
,etc. Office—330 Second St., Elyria, Ohio. Underwriter—
•common
A.
Bldg.,
Dealer Relations
LakeiGity- -Utah?/ Underwriter—None.
Guardian Chemical
if Elyria Telephone
•
Bank
Underwriter—B. V. Christie & Co.,
purposes.
Houston, Tex.
share. Proceeds
capital.; Office—702 Walker
Oct. 7
/stock
corporate
common
McGraw
a.m.
.(EST) Nov. 19.
Oct.
Inc.
per
r(jointly); Blyth & Co., Inc.; Carl M. Loeb, Rhoades & Co.
and Wertheim & Co. (jointly); Stone & Webster Securi¬
ties
Mountain
Oct. 15 (letter of notification) 750,000 shares of
stock (par 25 cents). Price—40 cents
39
t
(par
$2).
fertilize
writer—Graham
Price—$2.50
and
&
insure
per
citrus
share. Proceeds—To
fruit trees.
Under¬
Co., Pittsburgh, Pa.
Cnntinnpr\
nn
r»nnp
40
k
0
40
The Commercial and Financial Chronicle
(1556)
Continued
from
page
Perfect Circle
if Silicate Reduction Corp., Denver, Colo.
Corp.,
Hagerstown,
Ind.
Sept. 17 (letter of notification) 1,000 shares of capital
(par $2.50). Price—At the market (approximately
$14 per share). Proceeds—To Herman Teetor, the selling
stockholder.
Underwriter — A. G. Becker & Co. Inc.,
stock
well.
10
(letter of notification) 22,000 shares of common
stock. Price—At par ($1 per share). Proceeds—To pur¬
chase tungsten ore concentrates and for plant equipment.
Office—1127 Washington
—None.
•
Chicago, 111.
St., Denver, Colo.
Underwriter
Smith-Douglass Co., Inc., Norfolk, Va.
(10/27-31)
Oct.
14 filed
Budget Loans, Inc., Minneapolis, Minn.
Sept. 22 (letter of notification) 4,000 shares of preferred
stock, series A (no par). Price—$24 per share. Proceeds
—For working capital.
Office—227 Twin City Federal
Building, Minneapolis, Minn. Underwriter—M. H. Bishop
370,000 shares of common stock (par $5),
100,000 shares are to be offered by the company
270,000 shares by certain selling stockholders. Price
—To be supplied by amendment.
Proceeds—To install
phosphoric acid facilities and other plant improvements.
&
Business—Producer and distributor of fertilizer materials
Phoenix
-
Co., Minneapolis, Minn.
of which
and
and mixed fertilizers.
Longview, Tex.
(par $1).
Proceeds — For machinery and
Powers Manufacturing Co.,
Underwriter—F. Eberstadt & Co.,
Inc., New York. Offering—Expected week of Oct. 27.
Sept. 25 filed 250,000 shares of common stock
Price
$2 per
equipment and
share.
new construction.
Business—Production
of heavy duty power transmission chain, prockets, gears,
etc. Underwriter—Dallas Rupe & Son, Dallas, Texas.
—
if Sonic Research
Corp., Boston, Mass.
Oct. 15 (letter of notification) 400 shares of common
stock (no par). Price — $20 per share. Proceeds — For
working capital. Office—15 Chardon St., Boston, Mass.
Underwriter—None.
Redwater
Utilities
Holdings Oil & Gas
Calgary, Canada
(10/27)
1,200,000 shares of common stock (par 50
cents—Canadian). Price—To be supplied by amendment.
Proceeds—To pay for litigation and for general corpo¬
rate purposes.
Underwriters—White, Weld & Co., New
York; and George R. Gardiner Ltd., Toronto, Ont.,
Canada (for 600,000 shares each). Not to be offered pub¬
licly.
Ltd.,
Oct.
7
filed
if Sonny Allegheny Mountain Oil & Gas Co.
Oct. 10 (letter of notification) 10,195 shares of common
stock. Price
At par ($5 per share). Proceeds — For
drilling expenses. Office—1321 Lakefront, East Cleve¬
—
land, O.
•
f
Soundcraft Corp.,
N. Y.
10,245 shares of common
stock (par five cents).
Price—At market (about $2.62Vk
) per share). Proceeds—To Bernard Goodwin, the selling
stockholder.
Underwriter—Gearhart & Otis, Inc., New
Reeves
3
(letter of notification)
York.
Underwriter—None.
Southern
share
one
for
each
nine
shares
held; rights to
ex¬
pire Oct. 31. Price—At par ($25 per share). Proceeds—
To repay $3,500,000 advances from American
Telephone
& Telegraph Co. (owner of
960,296 shares, or 26.67%, of
the voting stock of
Southern, and for
property additions
and
improvements).
Office—New Haven, Conn.
Under¬
writer—None.
Airlines, Inc., Miami, Fla.
Oct. 1 (letter of notification) 20,000 shares of common
stock (par 10 cents). Price—45 cents per share. Proceeds
—To Richard A. Miller, the selling stockholder. Under¬
writer—Eisele & King, Libaire, Stout & Co., New York.
Resort
if Standard Cable Corp., Chickasha, Okla.
Oct. 15 (letter of notification) 35,000 shares of
common
stock
(par 25 cents). Price—$2.75 per share. Proceeds—
To Llewellyn Lord, the
selling stockholder. Underwriter
—Aetna Securities
Corp., New York.
if Stereo Sales Co., Inc., Seattle, Wash.
Oct. 10 (letter of notification) 680 shares of class A com¬
mon
stock.
Price—$100 per share. Proceeds—For new
Safeway Stores, Inc.
Sept. 12 filed 1,900 shares of 4% cumulative preferred
stcok (par $100) and 18,000 shares of common stock (par
$5) to be issued to James A. Dick Investment Co. (for¬
merly The James A. Dick Co.) in exchange for inven¬
tories, fixtures, operating supplies, good will and other
assets of Dick. It is anticipated that the Dick Company
will sell all or a substantial part of these shares from
time to time on the New York Stock Exchange. Under¬
if Stewart House Co., Los Angeles, Calif.
Oct. 9 (letter of notification) 430 shares of
preferred
stock (par $100) and 13,000 shares of common stock
(par
1), to be offered to 20 persons. Price—At par. Proceeds
—For working capital. Office—4140
Eagle Rock Boule¬
vard, Los Angeles 65, Calif. Underwriter—None.
Schulte
construction.
Office—1017 East
Seattle, Wash.
(E. B.)
Finance Co. of Albemarle, Inc.
Oct. 9 (letter of notification) 1,000 shares of
non-voting
common stock
(par $100) and 10 shares of voting com¬
stock (par $100) which were
"inadvertently sold
by this corporation for $285 per share to a resident of
South Carolina with letter of notification under
Regula¬
tion A."
Proceeds—To make loans.
Office—910 South
Tryon St., Charlotte, N. C.
(ap¬
proximately $2 per share). Proceeds—To certain selling
stockholders. Business—Cigarette and cigar store chain.
• Stone (E. B.)
Underwriter—None.
Underwriter—None.
To make loans.
the New York Curb
Exchange.
Price—At market
Oct. 9
voting
N. C.
Productions, Inc., Newport, R. I.
Sept. 8 (letter of notification) 5,000 shares of non-voting
common stock, series B (no par).
Price—$10 per share.
Proceeds—To acquire real estate and buildings, convert
sound stages, install recording equipment and
cameras,
and for other corporate purposes.
Newport, R. I. Underwriter
Providence, R. I.
—
Office—73 Bliss Road,
Kidder, Peabody & Co.,
St.
Simons
Island, Ga.
(letter of notification) 1,750 shares of common
(par $1). Price—At market (approximately $6.75
to $7.75 per share). Proceeds—To John E.
Haynes, the
Oct.
10
stock
selling stockholder.
Underwriter—None, but French &
Crawford, Inc., Atlanta, Ga., will act as broker.
•
Seiberling Rubber Co. (11/5)
1 filed $3,750,000 convertible
sinking fund deben¬
tures due Oct. 1, 1967. Price—To be
supplied by amend¬
ment. Proceeds—To repay
$1,200,000 loan and for work¬
ing capital. Underwriter—Blair, Rollins & Co., Inc., New
Oct.
York.
if Sentry Safety Control Corp., Phila., Pa.
Oct. 17 (letter of notification) 200,000 shares of
stock
(par 10 cents). Price—$1
working capital.
Underwriter
per
—
common
share. Proceeds—For
Louis
L.
Rogers
Co.,
New York.
Shelter
Manufacturing Corp., Portland, Ind.
(letter of notification) 5,000 shares of common
stock (par $1). Price—At market
(approximately $15 per
share). Proceeds
To Ralph P. Chempney, the
selling
Oct.
6
Office—910 South Tryon St.,
Underwriter—None.
Underwriter—Straus, Blosser & McDowell,
Chicago, 111.
Signal Mines, Ltd., Toronto, Canada
July 14 filed 300,000 shares of common stock.
Price—
At par ($1 per share).
Proceeds—For exploration, devel¬
opment, and mining expenses, and to reimburse Maurice
Schack, Secretary-Treasurer. Business—Quartzite min¬
ing. Underwriter
Northeastern Securities Co., New
—
York.
Streeter-Amet Co., Chicago, III.
Aug. 27 (letter of notification) 2,367 shares of common
stock (par $50) to be offered for
subscription by common
stockholders
at
rate of
one
new
share
for
each
four
shares held.
crease
Price—$100 per share.
Proceeds—To in¬
equity capital to take care of increased business
and increased
costs.
Office—4101
Ravenswood Avenue,
if Signode Steel
mon
9
(letter
stock (par $5) and 8,000 shares of preferred stock (par
$5). Price—At par. Proceeds—To buy and sell oil and
gases leases. Office—107
North Broadway, Oklahoma
City, Okla. Underwriter—None.
if Tungolin
Oct.
16
stock.
Co.,
Inc., Gulfport, Miss.
notification) 302 shares
(letter of
of
common
Price—At
par
($100 per share). Proceeds—For
machinery and working capital. Office—2906 25th Ave.,
Gulfport, Miss. Underwriter—None.
•
United Gas Corp.,
Shreveport, La.
(11/17)
Oct. 15 filed 525,036 shares of common stock (par $10) to
be offered for subscription by Electric Bond & Share Co.
to its stockholders on the basis of one share of United
stock for each
held
on
Price
—
10
shares
of Bond
and
Share
stock
about Nov.
or
17; with rights to expire Dec. 3.
To be supplied by amendment. Proceeds — To
Electric Bond & Share Co., which presently owns 3,165,781 shares (27.01%) of
outstanding United Gas stock.
Underwriter—None.
if United Wholesale
Druggists of Portland, Inc.
(letter of notification) 634 shares of capital stock
(no par). Price—$50 per share. Proceeds—To purchase
Oct. 8
merchandise for
resale
to
retail
druggists.
Ave., Portland 9, Ore.
Office—322
Underwriter—None.
• Universal Gas & Oil Corp., N. Y.
Oct. 17 (letter of notification)
295,000 shares of common
stock (par 10 cents). Price—$1
per share. Proceeds—For
liquidation of an indebtedness of $95,000 and for working
capital. Underwriter—Frank M. Cryan & Co., New York.
if Uranium Mines, Inc., Las Vegas, Nev.
Oct. 9 (letter of notification)
75,000 shares of common
stock. Price—At par ($1 per
share). Proceeds—For min¬
ing expenses and equipment. Office—300 Fremont St.,
Las Vegas, Nev. Underwriter—None.
if Utana Basins Oil Co., Salt Lake City, Utah.
Oct. 16 (letter of notification)
2,300,000 shares of com¬
mon stock
(par one cent), of which 300,000 shares will
be reserved for option to underwriters.
Price—5y2
per
share.
Bldg.,
Proceeds—To
Salt
Lake
City,
drill
Utah.
wells.
Office—509"
Underwriters
Nebeker & Co. and A. P. Kibbe &
—
cents
Atlas
W.
D.
Co., both of Salt Lake
City.
Sunshine Packing Corp. of
Pennsylvania
July 3 filed $1,000,000 of 6% convertible debentures due
1972 (subordinate) and 450,000 shares of common stock
(par 50 cents) of which the debentures and 400,000 shares
of stock
are
to be offered in units of
$50 of debentures
Price—$100 per unit. Proceeds—
To increase
capacity of plant and for working capital.
Underwriter—Weber-Millican Co., New York.
and 20 shares of stock.
Sweet Grass Oils, Ltd.,
Toronto, Canada
July 29 filed 375,000 shares of common stock (no par).
Price—To be related to quotation on the Toronto Stock
Exchange at time of offering. Proceeds—For working
capital. Underwriter—F. W. MacDonald & Co., Inc., New
York.
of
notification)
2,044
stock
shares
of
com¬
(par $1). Price—At market (about
$17 per
Proceeds—To John W.
Leslie, trustee of Walter
Underwood and Emily C. Underwood.
Underwriter—
Ames, Emerich & Co.,
share).
o.
Chicago, 111.
Products Corp., Red Bank, N. J.
(letter of notification) 75,000 shares of common
stock (par 50 cents).
Price—$2.50 per share.
Proceeds
—For working capital.
Office—42 West Street, Red
Bank, N. J. Underwriter—None.
3
Offering—Probably
some
if Vitro Manufacturing Co., Pittsburgh, Pa.
Oct. 15 (letter of notification)
2,500 shares of
stock
(par
per
50
cents).
Price—At
market
common
(estimated
at
share).
Proceeds—To Charles S. Payson, the
selling stockholder.
Underwriter
Blyth & Co., Inc.,
—
New York.
Waukesha
Motor Co., Waukesha, Wis.
(letter of notification) 5,800 shares of common
stock (par $5).
Price — At market (approximately $17
Oct.
6
per
share).
the
Estate
Proceeds—To Edward G. Bach, Executor of
Isabel Hadock.
Underwriter
Merrill
of
—
time in October.
West Coast
Pipe Line Co., Dallas, Texas
(letter of notification) 12,500 shares of capital
(par $10). Price—For 10,000 shares at par and for
Sept. 29
stock
remaining 2,500 shares $12.50 per share (latter to be sold
for account of 23
stockholders). Proceeds—For working
capital. Underwriters
White, Weld & Co. and Union
—
Securities
•
Corp., both of New York.
Whiting Corp., Harvey, III.
(10/30)
Oct. 10 filed 50,000 shares of 6% cumulative convertible
preferred stock, series A.
Proceeds
—
For
Price—At par ($25 per share).
equipment and working capital.
new
Business—Manufacture and sale of heavy equipment for
manufacturers
of
food
and
chemical processing, and
Underwriters—William R. Staats &
transportation, etc.
Texas General Production Co.
June 4 filed 2,500,000 shares of common stock
New York.
Tex.
if Wilcox-Gay Corp., Charlotte, Mich.
Oct. 16 (letter of notification)
$200,000 aggregate value
Co., Los Angeles, Calif.; and Shearson, Hammill & Co.,
(par 50
cents). Price—To be supplied by amendment. Proceeds—
To buy property for oil prospecting.
Office—Houston,
Underwriter—To be
named
fering—Tentatively postponed.
by amendment.
Of¬
Statement may be with¬
drawn.
Texo Oil Corp., Ardmore, Okla.
Sept. 2 (letter of notification) 934,400 shares of common
stock (par one cent). Price—31 V\ cents
per share. Pro¬
ceeds—To drill three wells to test formation
tion's leases in Duval and Live Oak
on
corpora¬
Counties, Texas.
Underwriter—Stanley Pelz & Co., Inc., New York.
Thompson Trailer Corp., Pikesville, Md.
27 (letter of notification) $13 6,150 of 5%
Aug.
vertible debentures, first issue, due Sept. 1, 1962.
capital.
Strapping Co., Chicago, III.
Video
Oct.
Lynch, Pierce, Fenner & Beane, Milwaukee, Wis.
Underwriter—None.
—At par (in units of $50 each).
Oct.
York; and Lynch, Allen & Co., Inc., Dallas, Tex.
$11.50
Charlotte,
—
stockholder.
New
if Tri-State Oil Wells, Inc., Oklahoma City, Okla.
Oct. 14 (letter of notification) 4,000 shares of common
Finance Co. of Laurinburg, Inc.
(letter of notification) 2,000 shares of class A non¬
common stock. Price—$25 per share.
Proceeds—
Chicago 13, 111.
if SeaPak Corp.,
.
Pike St.,
Underwriter—None.
if Stone
if Transcontinental Oil Corp., Dallas, Tex.
Oct. 14 (letter of notification) 60,000 shares of common
stock (par 25 cents). Price—At market
(approximately
$1.37y2 per share). Proceeds—To C. J. Simpson, the sell¬
ing stockholder. Underwriters—Bonner & Bonner, Inc.,
mon
(D. A.),
Inc., New York
Sept. 26 filed 717,149 shares of common stock (par $1),
in two blocks, one in the amount of 349,500 shares and
the other 367,649 shares, to be sold from time to time on
Seacrest
Thursday, October 23, 1952
gas properties, and to drill a test
Underwriter—None, but offering to public will be
N. W. 14th
if Reymert Extension Silver Mines Co.
Oct. 14 (letter of notification) 50,000 shares capital stock.
Price—At par (50 cents per share). Proceeds—To drill
for copper. Address—c/o Neil B. McGinnis.
P. O. Box
3617, Phoenix, Ariz. Underwriter—None.
writer—None.
.
handled through brokers.
Gas
New
England Telephone Co.
Sept. 22 filed 400,000 shares of capital stock being offered
for subscription by stockholders of record Oct. 8 at rate
of
Oct.
.
ploration of oil and
Oct.
39
.
Price
Under¬
writer—None.
Torhio Oil Corp., Ltd., Toronto, Canada
Aug. 21 filed 300,000 shares of common stock (par $1) to
be offered first to stockholders and then to the general
public.
Price
—
60 cents per share.
Proceeds—For
ex¬
stock
(par $1) to be issued to employees
Company's Employees' Stock Purchase Plan,
common
the
Price—At the market
per
(price around Oct. 14
share). Underwriter—None.
was
$1.121/2
Wisdom Magazine, Inc.,
Beverly Hills, Calif.
Sept. 17 filed 6,600 shares of 5% cumulative preferred
stock (par $100) and 6,600 shares of common stock
(par
$10) to be offered in units of one share of preferred and
one
con¬
Proceeds—For working
Address—P. O. Box 356, Pikesville, Md.
of
under
share of
common
stock.
Price—$110 per unit. Pro¬
national picture magazine. Un¬
derwriter—None. An earlier registration statement filed
July 14, 1952, covering a like offering of preferred and
ceeds—To
common
publish
shares
new
was
withdrawn Aug.
1,
1952.
if Wyoming National Oil Co., Inc., Denver, Colo.
Oct. 10 (letter of notification) 500,000 shares of common
stock (par five cents). Price—25 cents per share.
Pro¬
ceeds—To drill and equip wells.
Underwriter — R. L.
Hughes & Co., Denver, Colo.
Volume 176
Number 5162
.
.
.
The Commercial and Financial Chronicle
(1557)
Zenda Gold Mining Co., Salt Lake City, Utah
Aug. 18 (letter of notification) 1,200,000 shares of com¬
mon stock (par 10 cents).
Price—At market, but not less
than
par
stock
on
value.
(Current quotation of the company's
the Los Angeles Stock Exchange is seven cents
bid and nine cents
received
the
by
offered, if $120,000 gross sales price is
issue before all shares are sold, no
further shares will be offered).
Proceeds — For Alaska
placer leases, exploration and development, retire¬
ment of debt, and working capital. Office—30
Exchange
Place, Salt Lake City 1, Utah. Underwriter—Samuel B.
tin
Franklin & Co. of Los
Angeles, Calif.
standing short-term notes. Underwriters—To be deter¬
mined by competitive bidding. Probable
bidder—(1) For
bonds, Halsey, Stuart & Co. Inc.; Coffin & Burr, Inc. and
The First Boston Corp.
(jointly); Blyth & Co., Inc. and
Kidder, Peabody & Co. (jointly); Merrill
Lynch, Pierce,
White, Weld & Co. (jointly); HarCo., Inc.; Salomon Bros. & Hutzler.
(2) For stock, Blyth & Co., Inc. and
Kidder, Peabody &
Co. (jointly); Coffin &
Burr, Inc. and The First Bos¬
ton Corp.
(jointly); Harriman Ripley & Co., Inc.
Fenner & Beane and
riman Ripley &
Columbia Gas System,
Inc., N. Y.
Oct. 10 it was announced
plans to issue and sell
additional debentures
early in the
Proceeds—To repay bank loans and for
it Aluminium Ltd.
Oct.
15 directors expected that additional
be undertaken in
in
crease
The
as
financing will
1953 to meet the major part of the in¬
estimated
of
cost
the
expansion program.
E. Ames & Co., Ltd.,
First
acted
ers
the
Boston Corp., and A.
dealer-managers in stock offering to stockhold¬
in Oct. 1951.
American Trust Co., San Francisco, Cal. (11/12)
Sept. 30 Blyth & Co. Inc. and associates agreed to pur¬
chase at $55 per share such number of common shares
sufficient
to
provide the funds required to retire on
Oct. 27 the 4% convertible preferred stock
(par $50)
remaining outstanding after expiration of the conver¬
sion privilege at 5 p.m. (PST) on Oct. 22. The
preferred
is
convertible
for
stock
common
on
a
share-for-share
construction program.
Company has sought SEC author¬
ity to borrow from banks an aggregate of
$25,000,000.
Underwriters—To be determined by competitive
bidding.
Probable bidders: For
stock, Merrill
&
Lynch, Pierce, Fen¬
&
ner
Beane, White, Weld & Co. and R. W. Pressprich
(jointly); Morgan Stanley & Co. For debentures,
Co.
Halsey, Stuart & Co. Inc.; Morgan Stanley & Co.
Connecticut Light & Power Co.
March 1 it was announced that it is
presently estimated
that
approximately $11,000,000 of additional capital will
be required during the latter half
of 1952. Underwriter
—Putnam & Co.,
Hartford, Conn.
Detroit & Toledo Shore Line RR.
Sept. 17 it was announced that the
issue
1982.
and
be
cn
about
ders may
12
on
a
pro
rata
basis for
a
30-day
standby with Blyth & Co., Inc. underwriting.
Arkansas
Louisiana
$3,000,000 first
—
To
mature
refund
Jan.
on
mortgage
is planning
bonds
due
approximately $3,000,000
1,
1953. Underwriters—To
by competitive bidding. Probable bid¬
include Halsey, Stuart & Co. Inc. Bids—Ex¬
Sept. 16 company announced that further construction
will later on require additional
financing. There are,
however, no plans for raising any new capital at the
and
creasing authorized capital stock to 5,000,000 shares from
1,500,000 shares and on approving a 3-for-l stock split.
Freres
&
Co.
(jointly); Union Securities
Corp.; Smith, Barney & Co.; Equitable Securities Corp.
Proceeds—To repay bank loans and for new construction.
Arkansas Natural Gas Co.
<jointly); Smith, Barney & Co.
Power
&
Light Co.
C. Hamilton Moses, President, announced that
expects to borrow additional money next
Spring to finance its 1953 construction program, which,
it is estimated, will involve $29,500,000.
Aug. 7
"the
company
Byrd Oil Corp., Dallas, Tex.
July 22 it was announced stockholders will in the fall
receive the right to subscribe for $1,700,000 of 5Vz% first
mortgage (convertible) bonds on a pro rata basis for a
14-day standby
(certain
stockholders have waived
their rights). Proceeds—To repay bank loans and for
•development and exploration expenses. Underwriters—
Probably Dallas Rupe & Son, Dallas, Tex.; Carl M.
Loeb, Rhoades & Co., New York; and Straus, Blosser &
McDowell, Chicago. 111.
California Electric Power Co.
Oct.
7
it
was
announced
company
intends to sell early
in 1953
approximately $10,000,000 of additional new se¬
curities, the type of which has not yet been determined.
Bidders for common stock may include: Merrill Lynch,
Pierce, Fenner & Beane and Dean Witter & Co. (jointly);
Kidder, Peabody & Co.; Blyth & Co., Inc.
•
Central
Hudson
Gas
&
Electric
Corp.
Oct. 20 filed with New York P. S. Commission
for per¬
mission to issue and sell $6,000,000 first mortgage bonds,
"the
proceeds
to
be
for
used
new
construction.
bond
financing was done privately in March,
through Kidder, Peabody & Co., New York.
Central
Maine
Power
Latest
1951,
Co.
Stockholders
on
Oct.
15
will
vote
on
in¬
East Tennessee Natural Gas Co.
Sept. 29 it
•Oct. 3 it was reported company plans to issue and sell
-$23,000,000 of sinking fund debentures due 1972. Pro¬
ceeds—To retire $21,877,760 preferred stock at $10.50
per share. Underwriters—To be determined by competi¬
tive bidding.
Probable bidders: Halsey, Stuart & Co.
Inc.; The First Boston Corp. and Lazard Freres & Co.
Arkansas
present time.
pipe line the estimated
to construct
cost of
which,
$5,784,606, is expected to be financed through the issu¬
ance of
$4,500,000 of first mortgage bonds (which may
be
placed privately)
and
$1,300,000 of bank loans.
Traditional Underwriter—White, Weld &
Co., New York.
Eastern
Utilities
Associates
Sept. 3 it was announced that amended plant of reor¬
ganization of this company and subsidiaries calls for is¬
suance by
company of $7,000,000 debentures and a suffi¬
cient
amount
of
stock
common
to
raise
approximately
$2,000,000.
plan further provides that Blackstone Valley
Gas & Electric Co., Brockton Edison
Co., and Fall River
Electric Light Co. issue
mortgage bonds. Proceeds—To
repay bank loans.
Underwriters—For EUA debentures
may be determined by competitive
bidding. Probable
bidders:
Halsey,
Stuart
&
Co.
Inc.
(for
Lehman
bonds Trnly);
Brothers; Estabrook & Co. and Stone & Webster
Securities Corp.
(jointly); Glore, Forgan & Co. and Har¬
riman Ripley & Co., Inc.
(jointly).
Equitable Gas Co.
Oct.
3
it
was
1,
1970, of Equitable Gas Co.
Probable bidders: Halsey,
Stuart & Co. Inc.; The First Boston
Corp.; Kidder, Pea¬
body & Co., Merrill Lynch, Pierce, Fenner & Beane and
White, Weld & Co. (jointly); and Harriman Ripley &
Co., Inc.
European American Airlines, Inc.
was reported
company plans to raise an addi¬
$400,000 of equity capital. An issue of $200,000
of capital stock was just
recently placed privately at
$7.50 per share. Underwriter
Gearhart, Kinnard &
June 11 it
tional
—
Otis. Inc., New York.
it First National Bank
Oct.
15 it
was
& Trust
announced
Co., Evanston, III.
stockholders will vote Oct.
28
on
Sept. 2 it was announced company soon after March 1,
1953, intends to issue and sell $6,000,000 of first and
jgeneral mortgage bonds and sufficient common stock to
yield approximately $5,000,000 to refund the then out-
t
approving a proposal involving an offering of 25,000
additional shares of capital stock (par
$20) to stockhold¬
ers on a share-for-share basis.
Rights will expire on Nov.
18.
and
Price—$40 per share. Proceeds—To increase capital
surplus. Underwriter—None.
Frontier Refining Co.
Oct. 1 it was reported directors have authorized issuance
/
and sale of
$1,000,000 additional
Proceeds—To
convertible debentures.
increase
refining capacity. Underwriters
—Peters, Writer & Christensen, Inc.; Sidlo, Simons, Rob¬
erts & Co.; Boettcher &
Co.; and Bosworth, Sullivan &
Co. handled sale in May
1, 1951 of a like amount of 5Y2%
debentures due in 1961.
When the
rior
the
problem is producing a supe¬
printing job against
answer
thirty
is
years
Sorg
—
a
rush deadline,
specialists for
over
in financial, corporate and
legal printing.
We're
equipped to handle design, print¬
ing, binding and mailing all under
roof,
with
one
day and night availability.
SORB
it Garrett Freightlines,
Oct.
17
it
was
announced
Inc.
80 SOUTH
ST., NEW Y0HK 58, N. Y.
Amanda/, tjSeya/, c(o<Afwfuite
on
ated
Houston, Tex.
FPC for authority to
860-mile pipeline extending from southern
Louisiana to a point in northeastern Kentucky. This
project would cost about $127,887,000. Transportation of
gas is expected to commence by Nov. 1, 1954.
Oct. 3 it
was
(11/24)
announced company plans to offer and sell
$10,000,000 of first mortgage bonds.
Proceeds—For
new
construction and to repay bank loans. Underwriters—To
be determined by competitive bidding. Probable bidders:
Halsey, Stuart & Co. Inc.: Salomon Bros. & Hutzler and
for
each
four
shares
at
held;
subordin¬
debentures.
Proceeds—For expansion
Underwriter—White, Weld & Co., New York.
—
competitive bidding.
& Co.
Probable
bidders:
Halsey, Stuart
Inc.; Glore, Forgan & Co.; Blyth &
Co., Inc. and
Freres
&
Co.
(jointly); The First Boston
Corp.; White, Weld & Co. and Shields & Co.
(jointly);
Smith, Barney & Co.; Kuhn, Loeb &
Co., Salomon Bros.
& Hutzler and
Union Securities
able
Securities
Stearns & Co.
Proceeds—For
Corp.;
Corp. (jointly); Equit¬
Lehman
Brothers
and
Bear.
(jointly); Harriman Ripley & Co., Inc.
new
construction.
Laclede Gas Co.
Oct. 1 it
was
reported company may issue and sell
$10,000,000 to $12,000,000 of
securities, probably bonds.
Proceeds—For new construction. In
August of last year,
an
issue of $8,000,000
3%% first mortgage bonds due
1976 was placed
privately through Lehman Brothers
and
Merrill
Lynch, Pierce, Fenner
Mansfield
1
it
Tire
&
& Beane.
Rubber
Co.
was
reported company plans issuance and sale
convertible preferred stock issue.
Underwriter—A.
G. Becker & Co.
of
a
Inc., Chicago, 111.
MidSouth Gas Co.
Sept. 23 company ivas authorized
by FPC to construct
191 miles of natural
gas pipeline and to acquire an exist¬
ing 38-mile line from Arkansas Power &
Light Co. at an
aggregate estimated cost of $4,524,200. Stock
financing in
July, 1951, was underwritten by Equitable
Securities
Corp.; T. J. Raney & Sons; and Womeldorff
& Lindsey,
Mississippi Power & Light Co.
March 14 it
sell
was
reported
in November
bonds.
an
company plans to issue and
issue of $8,000,000 first
Underwriters—To
be determined
mortgage
by competitive
bidding. Probably bidders: Halsey, Stuart & Co.
Inc.;
White, Weld & Co. and Kidder, Peabody & Co.
(jointly);
Blyth & Co., Inc.; The First Boston
Corp. and W. C.
Langley & Co. (jointly); Equitable Securities
Corp. nnr?
Shields & Co.
(jointly); Merrill Lynch, Pierce, Fenner
& Beane; Union Securities
Corp.
Mutual Telephone Co.
(Hawaii)
23 it was announced company
Sept.
expects to place
an issue of
$2,500,000 3V2% bonds
plans to issue and sell next year about
$3,000,000
securities, half in preferred stock and half in common
stock. Traditional
Underwriter—Kidder, Peabody & Co.,
privately in October
and
New York.
Narragansett Electric Co.
Oct.
it
7
;
reported company plans issuance and sale
of about $10,000,000 first
mortgage bonds, series D. Pro¬
ceeds
was
To repay bank loans and for new
construction.
Underwriters—To be determined by competitive
bidding.
Probable bidders: Halsey, Stuart & Co.
Inc.; Kuhn, Loeb
& Co. and Glore, Forgan & Co.
(jointly); Salomon Bros.
& Hutzler;
Kidder, Peabody & Co. and Stone & Web¬
ster Securities Corp.
(jointly); Lehman Brothers ana
Goldman, Sachs & Co. (jointly); Union Securities
The
—
First Boston
Expected late this
Corp.;
Corp.; White, Weld & Co.
Offering-
early in 1953.
National Credit Card,
Inc., Portland, Ore.
8 it was reported company is
considering
year or
Sept.
some
•
doing
equity financing (probably in the form of class B
of $20 par
value).
stock
New
England Telephone & Telegraph Co.
(12/9)
Oct. 21 company announced it
plans to issue and sell
issue of $20,000,000 of
25-year debentures.
an
Proceeds—To
repay bank
loans, etc. Underwriters—To be determined
by competitive bidding. Probable bidders:
Halsey, Stuart
& Co. Inc.; Morgan
Stanley & Co. Bids—Tentatively ex¬
pected to be received on Dec. 9.
New
England Telephone & Telegraph Co.
directors authorized an
offering to stockholders
232,558 additional shares of capital stock at the rate
Oct.
21
($100
an
share
total of
(par $20)
Kansas City Power &
Light Co.
Sept. 15 company announced that it
plans to issue and.
sell late in 1952
$12,000,000 principal amount of first
mortgage bonds Underwriters
To be determined bv
outstanding debentures and preferred stock and for new
equipment and working capital. Underwriter—Allen &
Co., New York.
construct
new
convertible
program.
authority to issue and sell $1,100,000 6% convertible
debentures due 1967. Price—At
par. Proceeds—To retire
Sept. 16 company applied to the
one
a
International Minerals & Chemical
Corp.
1 it was announced
stockholders will vote Oct. 28
approving issuance of up to $20,000,000 of
of
Gulf States Utilities Co.
PRINTING CO., Inc.
has applied to ICC
for
Gulf Interstate Gas
Co.,
of
6
Oct.
•
(10/30)
company
rate
(11/6)
announced that Bank
proposes to offer for
rights to expire on Nov. 21.
Price—$40 per share. Pro¬
ceeds—To increase capital and
surplus. Underwriters
Scharff & Jones, Inc. and
White, Hattier & Sanford, both
of New
Orleans, La.
(10/23)
announced Philadelphia Co.
proposes to
invite competitive bids for its
holdings of $6,354,000 of
20-year 3%% sinking fund debentures, due March
was
subscription by stockholders of record Nov.
25,000 additional shares of common stock
Oct.
was announced company
proposes
about 100 miles of
Oct. 17 it
•
6, 1951 it was reported company may issue and sell
$35,000,000 of first mortgage bonds. Underwriters—May
be determined by competitive bidding.
Probable bid¬
ders: Halsey, Stuart & Co. Inc.; The First Boston Corp.
Lazard
* Hibernia National Bank, New
Orleans, La.
15.
Duke Power Co.
Dec.
(jointly); Carl M. Loeb, Rhoades
Higginson Corp. (jointly); Merrill
Lynch,
Pierce, Fenner & Beane and
White, Weld & Co. (jointly)Lehman Brothers; Stone &
Webster Securities
Corp.*
Bids—Expected to be received up to noon
(EST) on
Nov. 24. Registration—Planned
for Oct. 24.
Lazzard
determined
pected to be received about Nov.
Co.
Gas
sell
Proceeds
bonds which
The bank plans offer of additional common stock
Nov.
(11/15)
company
to
basis.
or
and
Spring of 1953.
Prospective Offerings
Union Securities
Corp.
& Co. and Lee
the
company
stock
common
41
of
one
new
per
share for each 10 shares held. Price—At
par
share).
Proceeds
—
For
repayment
of bank
loans, etc. Underwriter—None. American Telephone &
Telegraph Co. holds about 70% of the presently out¬
standing capital stock.
New
Orleans Public Service Inc.
(12/15)
July 24 company announced plans to issue and sell
000,000 of first mortgage bonds due Dec. 1, 1982. Pro¬
ceeds—For new construction.
Underwriters—To be de¬
termined by competitive
bidding.
Probable bidders:
Halsey, Stuart & Co. Inc.; Lehman
Brothers; Kidder,
Peabody & Co. and Stone & Webster Securities
(jointly); Equitable Securities
Corp. Registration
Expected
Tentatively set for Dec. 15.
—
Corp.
Corp.;
about
Union
Nov.
Continued
Securities
14.
on
Bids
page
—
4P
42
The Commercial and Financial Chronicle
(1558)
Continued from page
Pennsylvania Power & Light Co.
41
Oct. 3 it
Northern Indiana Public Service Co.
and
1953.
sell
Boston
Additional
If competitive, probable
Halsey, Stuart & Co. Inc.; The First
Corp.; Equitable Securities Corp.; White, Weld &
Co.; Smith, Barney & Co.
Natural
Gas
Oct.
is
1
sell
Peoples Gas Light & Coke Co.
Co., Omaha, Neb.
Sept. 29 it
Sept. 17 company sought FPC authority to construct
pipeline facilities to cost an estimated $69,826,000. This
would include about 442 miles of main pipeline addi¬
to
Halsey, Stuart & Co. Inc.; Blyth & Co., Inc.; The First
mortgage pipeline bonds, and preferred and common
Boston Corp. and Kidder, Peabody & Co. (jointly). Com¬
mon stock financing will probably be done via rights.
Sept. 13 it
an
reported corporation plans to sell publicly
was
Kaar
Oct. 21 it
was
Diego Gas & Electric Co.
natural
in the latter part
dissolution of
former sub¬
a
of this month
t
Sept.
—
For
expansion
later date.
a
Underwriters
program.
an
Telephone & Telegraph Co.
ratio
common
&
of
share
new
•
company
Southwestern
(11/18)
Oct.
3
stock
expects
,.
Un-:
bonds, to be determined by competitive
Probable bidders: Halsey, Stuart & Co. Inc.j
United
States
formed
Pipe Line Co.
to
"common
ranged
carrier."
initial
The
financing has been
for privately with no public
of the corporation.
Underwriters—Probably Dillon, Read
Glore, Forgan & Co., both of New York.
& Co. Inc. and
it was reported sale of this company's common
(at least 260,000 shares) by Sinclair Oil Corp. is
planned.
Underwriter
Union
—
Securities
Western
Natural
Co.
Gas
of which the company
plans to offer about 170,000 shares
convertible preferred stock (carrying a dividend rat*
of
about
5%) for subscription by
Southwestern Public Service Co.
on
reported that company may do
addi¬
tional common stock financing (with offer to be made
first to stockholders) and use the proceeds toward ita
was
Yet
15
I
can't
some
help feeling that if
the workers in America
ever
stroy
l-for-20
a
standing
basis.
shares
of
5%
preferred
retire bank loans and for
their-jobs,
infinite
work
terests
rise
as
investment
And at this
the
in¬
creases.
putting in
point I
call to Phil.
And so, of course, it
should; but
I
suspect,
since it doesn't they will
conclude,
I am sure, that they are NOT
get¬
boys
Dave's
would
escaped
"fair" profit, and they will
insist not only on higher
wages,
but on higher dividends as well.
a
Competition Would Still Be in the
Market Place
Which means, of
course, higher
prices. But right here,
some
money somewhere and
run across an
they
item headed "taxes."
Now that's when the lid blows off.
The boys discover that for
every
$1 they
getting in dividends,
the company is paying about
$6
in taxes to the
Federal, State and
are
have
very
somehow
of
many
people.
about
go
like
..."
Folly of Conflict Between Owner
you
to
get right down
ington.
those
say, "the
They want
sore.
They
fellows
want
you
down
Wash¬
to
to
there
tell
that
they've got to lower taxes. And
they've got to cut out a lot of this
Then Dave would
go
on
We
less
the
ash
can.
Of
some
Dave
future
and
I
election,
all
went to the
share
of
owners
U.
went
for
all
worth
Yeah,
to
the total "rent"
we
billions
used in
without
course,
our
made any
and
the
we
owners
paid them
of
dollars
of plants and furnaces and
facilities
And
the
making steel.
these
men
facilities,
could
not
of
have
of
everything the
owners
received
of
enterprise it
to
one
improve
their
living by grabbing the
share which the owners
from
our
-v • -
present
economic
>
More Production Is the Answer
shall
have
among
more
.
goods
If
divide
to
we
we
produce
fewer goods we shall have less to
divide and less to live on."For no
matter how many billions of dol¬
lars
we
pocket
more
may
as a
than
have in
nation,
we
our
are
.collective
we cannot
have
mean
noth¬
only paper, and
cannot
eat
build
house of them....
a
buy
produced; and
the dollars themselves
They
them,
crackpot
from
while
are
.
.
1
system
the
wear,
them-,
we
other
for
of
Karl
trying to keep
it.
They seek
us
to
breed suspicion and distrust among
They tell
us.
us
is the
that
one
economic
"natural enemy"
of
another; and they ask us for vast
political power £o that they can
existent
against
us
economic
those
non¬
enemies.
In
short, they follow the old political
maxim: "Divide and Rule."
--
Sad
served
to
ill.
or
relate,
them
but it has
our
for every
and
that
well
policy
on
,
has
occasions,
always served America
There is
for
no
future in it for
us
people.
But there is a
very great future—
American in protecting
future-^and
uor
.
fraternity
are
learning
"protect"
goods
more
ourselves.
owner
That is the lesson which, some¬
how, we must learn; yet we find
people today—both in and out of
group
.
-If..we produce
in¬
is impossible for
prosper
the
ing.
steel at all.
Let the workers take^one-tenth
voting
.
friends, American work¬
never
and
we
the
cigarettes, suffers.
They will only do it by pro¬
ducing a larger pie with a bigger
S.
Yet that small
owners.
was
of
of
when
that
American
our
Marx—who
the
while less than 8%
which
cartons
price of
pie.
,
to say:
Phil
be
which
sum
the
the workers,
the
share for everyone.
total
and
business.
our
For
"
Americans
of
meager
get
Traditional
antagonistic, but identical
standard of
and
Steel divided up between them
last year, more than 92% went to
possible that in
would
the
workers
The boys can't afford
them, either."
even
end¬
owner
nuts.
that's right.
Why, it is
that this
between
sheerest, unadulter¬
ated folly; for when we fight over
profits, we are fighting over pea¬
by the way, Phil, while
you're down there, you'd better
tell Congress to toss those price
into
learn
worker is the
"And
controls
would
conflict
my
will
ers
pretty
in
week, apiece!
No,
and Worker
are
fellow
invested
about three
a
"Look, Phil," he would
their
of
Andvfor what?
our
conversation,
spending, too. Defense is all right,
unhappily, but this boondoggling, and payroll
they run into the stern realities of
padding has just got to stop.
competition in the market place. Jumpin'
Jehoshaphat, Phil, the
And nowadays,
of course, they boys can't afford it!"
also run into a little matter of
government price controls.
So they go back over the books
once more in a final effort to find
that
great
a
this:
ting
Dave
can see
five-alarm emergency
a
that under
have
truths
few
a
out¬
$100), to
production
worker
not
000
quickly learn
2,053
(par
begin to understand
economy
and wipe out
the savings which more than 275,-
would
stock
of
measure
vast segment of our
a
national
fundamental and very simple eco¬
us
redeem
construction.
new
nomic
The Great Mistake of Karl Marx
stockholders
common
Proceeds —To
Underwriter—White, Weld & Co., New York.
harm upon
did
the tools of production, all of
own
should
(par $30),
as
construction program which, it is estimated, will involve
their
author¬
an
ized issue of 500,800 shares of preferred stock
Corp., New
November 18.
of
ar¬
offering expected
for at least two years. E. Holley Poe and Paul
Ryan, of
70 Pine St., New York, N. Y., are the principal officers
Sept. 2 stockholders approved the creation of
Aug. 4 it
stock
(Del.)
announced that this company had
build, own and operate a petroleum
was
products pipeline from the Texas Gulf Coast to St. Louis^
Chicago and other midwest markets to operate as a
Development Co.
Underwriter—To be determined by competi¬
bidding. Probable bidders: Halsey, Stuart & Co.
Inc.; Lehman Brothers and Union Securities Corp.
(jointly); White, Weld & Co.; Morgan Stanley & Co. Bidi
—Tentatively set to be received at 8:30 a.m. (PST) on
amount
of
stock. Proceeds—For construction program.
Sept. 25, 1950 it
struction.
their
shares
(jointly); Lehman Brothers, Harriman Ripley & Co.,
Inc., Bear, Stearns & Co. and Carl M. Loeb, Rhoades &
Co. (jointly); W. C. Langley & Co. Offering—Of
bonds,
probably in November; and of stock, later in 1952.
-
York.—
tive
page
500,000
>
Sept. 3 California P. U. Commission approved a proposal
authorizing the company to issue and sell $35,000,000
of debentures due Nov. 15, 1979.
Proceeds — For re¬
payment of advances and bank loans and for new con¬
from
and
(jointly); Carl M. Loeb, Rhoades & Co.; Kidder, Pea¬
body & Co.; The First Boston Corp. The common stock
offering may be underwritten by The First Boston Corp!
In 1950, the following group bid for common stock issue:
Merrill Lynch, Pierce, Fenner & Beane; Blyth &
Co.,
Inc.; Smith, Barney & Co. and Collin, Norton & Co^
•
Pacific Telephone & Telegraph Co.
bonds
mortgage
ler
approving a proposal to issue up to $89,643,000 of re¬
funding bonds to provide funds to refund a like amount
of bonds which mature up to and including Nov. 1, 1956.
Underwriters—To be determined by competitive bidding?.Probable bidders: Halsey, Stuart & Co. Inc.; Kuhn, Loeb
Oct. 16 it was announced company plans to issue and sell
& Co.; Morgan Stanley & Co.
mately 90% of the outstanding common stock.
Price—
At par.
Proceeds—To repay construction loans and for
further expansion.
Underwriter—None.
Offering—Ex¬
pected sometime in December.
first
Equitable Securities Corp. and Salomon Bros. & Hutz-
on
preferred stock held. American Telephone
Telegraph Co., the parent, presently owns approxi¬
i.
.
reported company plans issue and sale of
was
bidding.
announced stockholders will vote Nov. 21-
was
it
common
Southern Ry.
Oct. 16 it
shares of
for each nine
or
Continued
Co., Kansas City, Mo.
Co.
1
been
was
offer
one
the
during the first six months of
permissible under its mortgage
indenture, and to provide for other permanent financing
by the sale of additional first mortgage bonds or other
securities in such amounts as may be appropriate at the
time. Probable bidders for bonds: Halsey, Stuart & Co.
Inc.; Kuhn, Loeb & Co.; The First Boston Corp., Blyth
& Co. Inc. and Kidder, Peabody & Co. (jointly). Any
stock financing may be via stockholders.
authorized by the California P. U.
for subscription by stockholders
additional 703,375 shares of common stock (par $100)
in the
that
announced
was
additional bonds
Edison
derwriters—For
—
1953 in the amount then
$179,000,000. Financing is expected to consist of first
stocks, and is expected to be completed by April, 1953.
Underwriters—White, Weld & Co. and Kidder, Peabody
& Co., both of New York, and Dominion Securities Corp.,
Ltd., Toronto, Canada.
to
it
15
sell
to
capital" cost of the project
is
Commission
stock.
■
Oct. 3
Southern Natural Gas Co.
with the FPC proposing to construct a 1,384-mile trans¬
Sept. 3 company
Mo.
stock (par $25)
plan sale of about 84.000
Registration — Expected this
Underwriter—Stern Bros. &
-
substitute application
mission line extending from the San Juan Basin in New
Mexico and Colorado to market ^reas in the Pacific
Pacific
the
of
stockholders
common
$7,500,000
Smith, Barney & Co. and Merrill Lynch, Pierce, FennerBeane, both of New York. Registration—Statement ex¬
pected to be filed this month.
Estimated overall
certain
of
Toledo
a
&
Northwest.
cost
preferred
week.
Price—To be determined at
to stockholders.
Pacific Northwest Pipeline Corp.
)
estimated
Underwriter—Kidder. Pea¬
shares of convertible
that
and
bidding. Probable bidders may include Blyth & Co., Inc.
t
The
* Thurston Chemical Co., Joplin,
40,000
registration statement
covering a proposed issue of about $100,000,000 new con¬
vertible subordinated debentures to be offered initially
stock (par $25) of Pacific
second
Mexico.
$184,000,000.
over
body & Co., New York.
Proceeds
a
from
gas
project is
sidiary. Underwriters—To be determined by competitive
Aug. 29 company filed
$2 per
Scott, Khoury, Brockman & Co.,
—
an oral argument for Oct. 20 on a
by National Coal Association and others to deny
company's application to build a 1,406-mile pipeline ex¬
tending from Texas into West Virginia and to import
Sinclair Oil Corp.
announced that North American Co. plans
Gas which it received upon
issue and
to
Price
Oct. 6 company announced it plans to file with the SEC
Electric Co.
to sell 78,684 shares of common
stock.
shares
Engineering Corp. of Palo Alto, Calif.
Pacific Gas &
program.
expansion of
issue of prior preference stock to finance
planned
company
common
—
motion
July 1, L. M. Klauber announced that of the more than
$18,000,000 required for capital improvements in 1952,
approximately $4,000,000 will become available from de¬
preciation reserves and earned surplus, while the re¬
mainder must be secured through the sale of securities.
Underwriter—Blyth & Co., Inc. handled previous pre¬
ferred stock financing.
Inc.
of
Texas-Ohio Gas Co.
($100 per share).
Underwriter—None.
Proceeds—For expansion
Pacific Associates,
reported
Underwriter
Sept. 30 FPC scheduled
Price—At par
tions; installation of a total of 73,600 h.p. in new and
existing compressor stations; and numerous branch line
additions. Probable bidders for debentures or bonds;
San
was
150,000 shares
announced company plans issue and sale
was
one-for-five basis.
a
stock
Inc., New York.
present stockholders of 186,715 shares of capital stock
on
ended Aug. 31,
financing
year
preferred
Standard Tungsten Corp.
bidders may include:
Boston
share.
Northern
and
be necessary; this previously was done pri¬
Underwriter—Dillon. Read & Co. Inc., New Yoru.
vately.
Corp. and Drexel & Co.
bond
also
may
$10,000,000 of first mortgage bonds. Previous
financing was done privately through The First
bond
Sept. 18 it was reported company may issue and sell
shortly after the close of this year some additional pre¬
ferred and common stock. Underwriters—May be Cen¬
tral Republic Co. (Inc.), Blyth & Co., Inc. and Merrill
Lynch, Pierce, Fenner & Beane.
Thursday, October 23, 1952
.
approximately $23,000,000 for the
reported company may be planning to issue
was
.
.
a.
perfecting the only economic
in the world where men
system
and women,
in
every
walk of life,
the same Presidential candi¬ for the use of these
And there we have
.tools?.-and
the-simple, can and do own the tools of pro¬
Well, I will date!
what would they get? Peanuts, as economic truths of the matter. To
duction.
leave it to you to imagine all of
But that, of course, is pure con¬ I have said.
Less than a dime a live better we must produce
more;
And we shall never reach that
the colorful language that would
jecture; and it may be that in giv¬ day. But let them go whole^hog but production is the result o* future
by following.th° leadership
greet this discovery, but I seem to
and grab all of the owners^Share teamwork, not of conflict; We
ing rein to my imagination, I have
can¬
of men who nre^ch the spiteful
hear one of the delegates
saying: innocently misquoted some of the
let them wipe out all ot these not produce
by fighting each other doctrine of "Divide
Rule." We
"Holy smoke, Dave! I thought future statements of
my future dividends completely and forever and hating each others for
by do¬ shall reach it onlv through our
you said we had a
friendly gentle¬ successors.
If so. I apologize to
and what happens then? They ing that we destroy ourselves. An^
steadfast determination to unite
man
local
Governments.
.
..
...
.
in the White House!"
them
most
humbly.
.
.
would
destroy
the
company,
de¬
we
shall
only achieve
our
fullest
and produce!
.
Number 5162
Volume 176
.
.
The Commercial and Financial Chronicle
.
(1559)
1949.
Continued from page 16
He
A.I.B.
the
News About Banks and Bankers
will
assume
his new
the bank in Novem-
had
is
Anderson, the
became
been
active
(Va.)
chapter. Mr.
as an ac-
ated from Yale
20,000 shares
Upon
University in 1925.
graduation from the Har-
counting supervisor.
He was
na*?ed a.^10F
J lnt3ancl Resident Auditor tor Richumud and Petersburg offices on
lj
?•
6 a1S a- ™embei,l
9} f"6 Rational Association ot
^anf.rs an<J Comptrollers,
par
First Virginia Conference; Chair-
vard
Law
with
duties
At the
ber.
meeting of the
same
Officer.
Gilman gradu-
Mr.
School
three
law firm
the
June
&
of
with
whom he
has continued in practice. During
the
two
took
1930
years
1932
to
he
position
in
Washington with the Department
of
temporary
a
Justice.
+„11C,+QQ
trustee
of
the
R.
director
is
Worcester County
Savings, a trustee
C. Taylor Trust, and a
for
William
of
Company.
Allen
is
He
Son's
the
of
in
active
Worcester civic affairs and is
President
a
Wovoocior
the
of
Institution
Gilman
Mr.
School,
Worcester
Tax-
of
Worcester
Community
the
of
member
a
Committee
Executive
the
Council,
1920
Ohio
from
degree
in
and
University
1922
received
degree of M. B. A. from the HarSchool of Business
Graduate
vard
V"
Pennsylvania
Company
Banking and Trusts
of
phia
as
after
Colonel
serving
assigned
to
for
Auditor
^
d^1feneu L" tne auchioi
Headquarters, U. S. Air
Forces, since March, 1951. He will
„
Generals
be
in
charge
of
thp
hank'c
,
meJg
Lieut.
a
g
mePn;
Philadel-
the
u
was6 ^"caDtain in
Arm^Air Coras in the
^ H .^in d the bank
and
on
20'
•'
1948
with
a
„lber
since
i?
u
the
of
Federal
Jan
work
2
elected
*
The
fice
*
the
Sacramento
Anglo
Bank
opened
*
West
new
of
tional
Allard
the
A.
Calkins,
Board
bank
be
to
this
is
,
the
Shore
South
Virginia
Johnson,
moted and
Assistant
John A. Mount is Assist¬
office is
new
a new
were
*
S.
A.
Russell
from the
announced
was
bank's San Francisco
Kenneth
a
Annual
Second
Business
Prefessional
and
Executives
lor
Menl of Northern New
Jersey will
Hotel
Alexandei
be
held
fw
'/
M
p.m.
include*
inciuae.
the
of
Dr
ui.
General
Wormser, of
York law firm of Myles,
Co.,
the New
Rene
The Business
Wormser and Kock.
Management Conference is sponsored by the County Bank & Trust
Co. of Paterson and Passaic, N. J.,
of
which
Fuller
Kenneth
C.
President
Cowles
and
bank,
financial
is
and
with
the
bank
since
•
Hpnartmont
he,
gmia,
the
to
ment
ant
National
the
tho
of
was
in
and
Rank
in??
1947,
Vice-President
Osaka is
fices at 740 East 225th Street, New
York City, under the firm name
of
Principale
have
years
V. J.
Investments Co.
Associates
a
Mr.
McClure
member of
the
has
Banking
Brittle
Student
Ad-
Di
Fiore; E. A. Kelley;
located
on
it
made
one
of
to
The
D.
the
Owen
with
on
Insti-
Dec.
G.
associated
July
has
A consolidation of the First Na-
tional
Bank
N.
was
J.
Co.
Trust
&
effected
under
of
e
1
»
The
it
+
nffnntivp
Ont
serve
31,
A.
1953. He succeeds
Frierson, merchant
of
the
affiliated
become
Perry T.
Blaine
&
Co., 221
the
Joins Clair Hall Staff
(Special
to
The
Financial
CINCINNATI,
Chronicle)
Alma
Ohio —F.
Stanton has become affiliated with
Clair
S.
Hall
&
Company, Union
Trust Building.
To Retire From Firm
:2s
sis
The
Assistant Man¬
as
Officer.
Operations
and
ager
Bank
90
Clarence
—
Center Street.
an¬
nounced that Admiral of the Fleet
Sir
Vian,
Philip
G.C.B.,
SUBURBAN PROPANE
GAS
K.B.E.,
CORPORATION
QUARTERLY
REGULAR
DIVIDEND
NOTICES
Midland
London
of
DIVIDEND
i
the
of
directors
Limited
,
s;s
NOTICES
DIVIDEND
NO.
27
DECLARED
Common Stock—30^ per
share
Mr.
holders of record October 31,
and
1952.
R. GOULD MOREHEAD,
Treasurer
October 15, 1952
_____
the First Na—
charter and title of
m\/inruin
Kearny
on
kinTier
November
—
WANTED
SITUATION
of
15,
1952,
5,
Company
on
stockholders
on
1952.
W. C.
IMPERIAL OIL LIMITED
to
the close of business
of record at
November
the
Slock
Common
DIVIDEND NOTICE
;&* Trust
Co.
of
Sept. 30. The latter
Bank
fional
Beck, Treasurer.
Southern
TRADER
NOTICE TO
Over-the-counter trader with 24 years
of
background
trading
and
entertain
would
AND
seeks position
out
of
SHAREHOLDERS
INTERNATIONAL
HOLDERS OF SHARE WARRANTS
California
Edison
Company
HARVESTER
town
DIVIDENDS
proposition.
Box K 1023, Commercial
Financial
Chronicle, 25 Park Place,
&
New
York
7,
N.
Y.
31, 1952 will receive
dividends by cheque. This dividend in respect of share warrants, which
WANTED
HELP
A dividend of 40<j- per share in Canadian funds has been declared on
the outstanding shares of Imperial Oil Limited
payable December 1,
1952. Registered shareholders of record October
have
be
on
not been submitted for
conversion into registered shares, will
paid on and after December 1, 1952 by The Royal Bank of Canada
presentation of coupon No. 80. Transfer books will not be closed.
WASTED
COMPANY
CUMULATIVE
er
MUTUAL FUND
A
large, rapidly
a
has
opening for
experienced fund
thoroughly
sales
No.
growing mutual
investment fund
executive
its
in
New
York
No.
or
Pacific
stating
ord
of
man
80
is
the
final
Please
age,
knows
ment.)
Address
of
Box
Order
of
the
Board
General
October 16, 1952.
SERIES
DIVIDEND
NO. 20
November 5, 1952.
J. EGER, Secretary
The Board of Directors has
authorized the payment
of the
following quarterly dividends:
25V2
cents per
share
on
the
Preferred Stock,
4.08% Series;
INTERNATIONAL
HARVESTER
30V2
cents per
Cumulative
share
on
the
Preferred Stock,
4.88% Series.
The above dividends are pay¬
COMPANY
able
November
30,
1952, to
stockholders of record Novem¬
By
The Directors of
rec¬
G1016, The
4.88%
,
11
PREFERRED STOCK
CUMULATIVE
and
Cumulative
er
advertise¬
on
GERARD
coupon
Colin D. Crichton,
Commercial & Financial Chronicle,
25 Park Place, New York 7.
dollar
preferred-stock payable December
1, 1952, to stockholders of record at the
registered shares.
(Our organi¬
this
NO.
the
again reminded that in accord¬
write
education, and
experience.
zation
one
seventy-five cents ($1.75) per share on
designated for dividend purposes and
attached to outstanding hearer share warrants, future dividends in
respect to the shares covered by hearer share warrants will be paid hv
cheque only upon conversion of such bearer share warrants into
from Mid-West
Coast.
of
137
resolution
•
office. Prefer
are
PREFERRED STOCK
SERIES
DIVIDEND
Company have declared quarterly
dividend
adopted by the shareholders at the annual
meeting held in Toronto on April 24, 1952, no further bearer share
warrants are being issued by the
Company, and no further coupons
will be issued for the payment of dividends.
Accordingly, as coupon
ance
VICE PRES-SALES
with
warrants
4.08%
The Directors oflnternational Harvest¬
close of business
Holders of bearer share
Secretary.
•
Payable November 15,1952 to stock¬
planter, of Shreveport, Louisiana,
At a meeting of the Board of Directors
who resigned. Mr. Bogle is enof The Gamewell Company, held to¬
gaged in livestock feeding, farming, and ranching. He has been day, Friday, October 17, 1952, a divi¬
dend of $.25 cents per share and a
serving as a director of the El
special dividend of $.25 cents per
,
share, was declared payable on the
17,-1944,
after working with the Federal
Reserve Bank since Oct. .25, .1926.
Kearny, N. J. and the Harrison- Re was named Auditor in
1945
Kearny'Trust Co. of East Newark, and General Auditor on Aug. 22,
*
DirectorS
1
Chronicl*)
Financial
ASHTABULA, Ohio
for tbe unexpired portion of a
three-year term of office ending
is
and
courses.
became
bank
of
been
Henry Grote will retire from
pointed to the Osaka Manager¬
ship.
He will be aided by C. E. partnership in David A. Noyes &
Steiger, also from Kobe branch, Co., Chicago, on Oct. 31.
Federal Reserve System has appointed Hal Bogle, of Dexter, New
Mexico, a Class C director of the
Federal Reserve Bank of Dallas,
served
instructor for American
the
vr
*
*
"
The Board of Governors of the
December,
of Business Administration
of
to
*
Presldent effective Oct. 20.
Assist.
g^y 0f Richmond Evening School
Mr.
Board
«.
prAc^Anf
visory Committee for the Univer-
an
*
has
With Perry T. Blaine
(Special
industrial and
an
center
who is to
Thp
it*
depart-
an
in
$1,500,000
from
*
assigned
loan
eiected
was
15,
$2 000 000.
A
1 First
National
Bank
of
Fort
discount worth Texas announced the elecof
vir
wor£n' lexas, announced me eiecof.Vir" tion of Harry W. Phillips as Vice-
7u
•
in
commercial
1949.
as
i
•
Begmnnig
Oct.
tive
pj-ior
brokerage firms in that
A"
Clty*
with
*
*
with
1941,
W.
G.
pro-
to that, .he was
associated witfiUhe Chemical Bank
and Trust Company in New York
Andrus,
Executive Vice-President.
*
been
Oct
Q
Lemuel Bouiware
Vice-President
Electric
on
4
13 at 8
will
win
sneakers
speaKers
Marcus Nadler,
J
19
Nov.
30, Nov. 6 and
The
ine
N
Pafpr^on
Hamilton
!1
the
at
has
juiy
Paul
and F. J. Larkin.
Prior to entering
Management Conference for Sen-
Co.
Principale Inv. Co.
.
.".The
&
Giacomo Principale is engaging
in a securities business from of¬
are
headquarters
branch of the California branch
chinson, Assistant to the President
the
Ellis
Yarrow has retired from the firm.
Smith, Executive
Vice-President in charge of the
bank's international banking af¬
fairs. Fourth Japanese city to have
by
and director. They succeed Lloyd
with
firm
The opening recently of a new
formed with offices at 170 Broad¬
banking establishment in Osaka,
way, New York City, to engage
Japan, by Bank of America N. T. in the securities business. Partners
1
associated
The
—
Yarrow, 240 North
Avenue, has been changed
*
°f Directors at the Oct. 10 meet- Banking Department and pres- Far East's principal ports, it is
the
employ
of
the
Worcester ing.
John S. McClure was ad- ently is Executive Vice-President stated. Other Bank of America
branches are in Tokyo, Yokohama
County Trust in 1932, Mr. Powell vanced to the office of Vice-Presi- of the Citizens National Bank of
and
Kobe.
Officers
from
the
was
a
statistician and an invest- dent;
Fred G. Brittle, Jr., was Waukegan, 111.
bank's present Far East staff will
ment analyst with several finanpromoted to Assistant Vice-Presi*
*
*
cial
institutions,
including
the dent;
Paul
M.
Anderson
was
As a result of the sale of $500,- operate the new branch, it is an¬
nounced.
Jack Wallace, Manager
Babson Statistical Organization.
named General Auditor and Basil 000 of new stock, the United
of Kobe branch for the past three
*
i.
*
M. Jones, Jr.,
was elected
an States National Bank of Omaha,
and one-half years, has been ap¬
Anmrai
Dnckpcc
Assistant Cashier.
Mr. McClure Neb. increased its capital, effecAdministration.
to
Ariz.
of Ellis &
Kellard Assoc. Formed
of
*er named, by action of the Board
PHOENIX,
name
Central
Drexler and Benjamin F. Fohr- southern part of Honshu Island.
Assistant Cash- man. Mr. Meyer was formerly Developments in the past five
Richmond
at
West
office
area.
&
Na-
nnn°Ugmua s
dividend of $150,- bank. Mr. Meyer becomes Presiouo*
.lncreased capital v be- dent and Chairman of the Board
came effective Sept. 26.
~y
0f Directors and George M. Mur■>
in
new
Now Kenneth Ellis & Co.
Kellard
The
irs* National Bank of tional Bank of Chicago, 111., it is
^yr®'
*
capi~ announced by H. M. Batson,
*al fr?m $!50,000 to $300,000 Executive Vice-President of the
Bank
of
first
Vice-President and Manager, is in
The
Limited.
pany
at Jefferson Boulevard
Merkley Avenue in a new
building of modernistic design.
A
night-and-holiday
depository
and a customers' parking area in
the rear are among the features.
❖
*
*
Walter T. Meyer and associates
in
Anglo's
Manager.
Board
Anglo's fourth in the Sacramento
have acquired the controlling in-
*
The
established
W.
their
15,
Chairman
c
*
Oct.
on
located
ant
vear
y 3
he has been W1th the commercial
terests
*
Na¬
and
Everett
of
Francisco
announced.
Sacramento,
members
and of the Board of the Midland
Bank Executor and Trustee Com¬
of¬
California
San
of
business
for
charge.
d|Lgrt
o[
of
assign
tni?t
new Dusmess activities.
Three officers of The
Re¬ D.S.O.,
and
Lt.-Colonel
John
March, Philip Hunt, T.D., J.P., have been
1945.
ioan denartment
business activities
new
tc? Se'
a
V'B' EtC; Mri
w
The
Bank of Dallas since
i
,
*
4
Virginia
John W. Clegg, Jr. has returned
the U
S
to his post as a Trust Officer of
e,
in
the
0
*
Mr. Powell received his A. B.
etc.
I?.a?
now
payers' Association and Chairman
pf the Board of Trustees of Bancroft
(common stock) of
$25 each; surplus of $550,000,
and undivided profits of not less
with than $50,000.
Gage, Hamilton,
White,
Ar
ported capital stock of $500,000 in
years
later, he became associated
Branch
serve
u
Directors, held on Oct. 14, Ralph
D.Powell was promoted to Assist- of the consolidation the enlarged
ant
Vice-President
and
Invest- First National Bank & Trust rement
Paso
new General Audi¬
associated with the
bank on July 12, 1945,
capital (common stock) of
$300,000,
while
the
HarrisonKearny Trust had a common stock
of $100,000. At the effective date
a
in
past President of
a
Richmond
tor,
Whipple,
has
and
43
International Harvest¬
Company have declared quarterly
151 of fifty cents (50O
dividend No.
Checks will be
the Company's
office in Los Angeles, Novem¬
ber 5, 1952.
mailed from
share on the common stock pay¬
January 15, 1953, to stockholders
of record at the close of business on
ber 30,1932.
December 15, 1952.
October 17,1952
per
able
GERARD ].
EGER, Secretary
P.C.
HALE,
Treasurer
The Commercial and Financial Chronicle
44
.
.
Thursday, October 23, 1952
.
(1560)
income taxes. In the
BUSINESS BUZZ
of REA
case
electric co-ops, they are
totally or
partially free, also, of rate regula¬
0Tb
•
•
•
tion
g
•
under
pressured
legislation
through with the backing of the
BeHnd-the-Seen* Interpretation*
from the Nation's
cooperative lobby.
And You
Capital
(This column is intended to
re¬
flect the "behind the scene" inter¬
pretation from the nation's Capital
,
D.
WASHINGTON,
irnn
C.—Chair-
Maple T. Harl of the Federal
Deposit Insurance Corp., who is
both of being a Democrat
&?--d a crony of Harry Truman,
feas taken the leadership in insti¬
the
empire. Like many others,
but operates
cratic
under
"cooperatives."
facade of
a
tuting a boon of great value to the
corporation's 1,080 employees on
the eve of the national election.
ment has allocated
(the
1
Nov.
election
4) these 1,080 em¬
ployees hereafter will have their
personal hospitalization insurance
paid out of FDIC funds.
This
covers
their hospitalization
for
causes for which such plans pro¬
vide insurance — not merely the
Nov.
employer's liability for illness or
accident sustained in the course of
After
three
Offers Va. El. Bonds
the govern¬
something like
years
A group of underwriters
$100 million for loans to finance
the construction, installation, or
modernization of telephone lines
and facilities. These
offering
J,
they vary greatly in size. A small
proportion of these projects have
been put into operation, except
where existing phone companies
however, as it
will be paid for by FDIC, will not
cover the families
of employees.
This
If
the
the
extend
to
coverage
must pay for
families they
at
this
not
end
with
employees
does
the
prospective payment by FDIC of
it
Marl,
Mr.
long
insurance.
hospitalization
is understood,
has
been
interested in a plan to
vide
that there b«
surance
the
upon
pro¬
life in¬
agency's em¬
group
ployees. A plan is said to be under
consideration whereby 50% of the
life plan would
FDIC funds, and
by
the
employees
cost of that group
he covered out of
the
balance
themselves.
Immediate
de¬
out?"
empire
Electrification Administra¬
Rural
of
tion
this
the
is
the
Department of Agri¬
culture. REA now owns something
more
than half of the rural elec¬
phone
not
in
ments
or
tion
to
the
form
vote
by
been
of the
ordered
Independents Doubt
words, what REA says
business,
and the private
is that it will make available with
industry, something less
no favor its easy money loans to
than half. In the process the REA
both commercial and cooperative
has become politically one of the
rural
lines.
The
"commercial"
most strongly-intrenched interests
in the government.
Serving mil¬ category obviously excludes
AT&T. These loans cost only 2%
lions, it is a political sacred cow,
interest and run for 35 years.
capable of receiving only mild
were
President
Roosevelt
in
the
mid-
FDIC board, on 30's, something like only 10% of
become effec¬ the nation's farms were
electrified,
the
a
throughout the country.
Not all
those working in the District of
Columbia, however, are necessar¬
ily voteless. Some live in adjacent
Maryland and Virginia where they
could
qualify to vote. Those actu¬
ally residing in D. C. often can get
absentee ballots.
FDIC is unique among govern¬
ment
agencies in that not a cent
In fact,
it
was
saturation
of
motivated
REA
telephone
market
to
business
tainer for the
turn
which
to
the
agency
upon
the device of
more
or
less dummy
"REA cooperatives."
control
is
not
called
the Budget Bureau has
no
indicate
a
greater saturation than
does REA.
of
classified
offering advice. The FDIC
accept or reject the advice.
may
On the other
hand, the General
Office is empowered
to audit FDIC's payments.
Some three
«?
have
the
required by the
REA
agency.
telephone
"equity
state
on
by
more
though there
ings in rural
the
Census
agreed
to
a
report
on
patches of
ing
in the rural phone financing busi¬
that
bureau-
REA
company
tells
private
the
REA
already served
companies,
or
mercial
total
loans
was
$63,566,000
for
loans,
the
and
commercial
the
sum
of
It is the view of observers that
$31,152,000
to
"cooperative"
disparity
against
many
of
the
thousands
of
small
independent telephone companies,
facing great difficulty in raising
admittedly
fast increasing.
is
money,
are
redeemable
at
of
These
are
free of Federal
the
Company
at
104.55%
to
from
fund
the
or
mainte¬
improvement fund, at
ranging from
Virginia Electric
is
electric
an
101.55%
to
of
Power
Co.
Virginia and in portions
of North
ginia.
&
utility operating in
Carolina and West
Vir¬
It also distributes natural
gas in Norfolk and Newport News.
Population
by
the
2,200,000,
whom
1,000
of
territories
company
reside
or
is
served
estimated
at
two-thirds
of
communities
of
about
in
For the 12 months
more.
July 31, 1952, electric busi¬
provided
96%
the
of
com¬
pany's operating revenues, and its
gas
business, 4%.
Operating
1952
net
to
of the util¬
revenues
ity in the 12
months
ended
aggregated
operating
$11,701,000.
July
$73,528,000;
amounted
revenues
$15,071,000,
net
and
income
;
.
For
will be absorbed by REA
co-ops.
loans
of
for the sinking and im¬
and
prices
31,
com¬
con¬
par.
sur¬
Independents Will Be Hit
94 to "cooperatives."
However, the
Ex¬
tentatively
are
availability
ranging
nance
by compet¬
It has made 113 loans to sup¬
far, against
elec¬
facilities.
the
upon
and
par,
ness
rounding such companies' lines.
so
$7,800,000 for
bonds
prices
Telephone Assn.,
asserted
private
$20,-
generating
:
•
Large Appreciation Potential
WE SUGGEST
RIVERSIDE CEMENT CO.
CLASS B
FIRM TRADING MARKETS
(common) STOCK
SECURITIES
leading
in
FOREIGN
A
fast-growing Southern Cali¬
producer
of
cement
fornia.
Analysis of
this Company and
review of
the Cement Indus¬
a
HARL MARKS & P.O. INC.
try available
on
request.
Available around
FOREIGN SECURITIES SPECIALISTS
50 BROAD STREET...NEW YORK 4, N. Y.
15*/2
LERNER & CO.
Investment Securities
TEL HANOVER 2-0050...TELETYPE: NY 1-971
10 Post Office Square, Boston 9, Mass.
Equally
.
the
$6.8
continues to solicit membership in
areas
and
option
ended
is not
posedly commercial companies
The
the
At last week's convention of the
U.S. Independent
additional dwell¬
areas
lend
"cooperative"
so
al¬
capital"
million.
not
5,500,000
than
are
and
as
is
"Favor" Private Companies
ago—exactly
new
"farms"
of
land too small to qualify as farms.
—Congress laid
a
phones at 4,500,000,
number
much
Empire
years
the foundation for
the
sum
regulatory
They place the number
of rural
Report
could
just playing the cooperative game
ness.
4% interest the
$286,000 from REA electrifica¬
tion cooperatives in order that it
Even
it
"cooperative"
Sources other than the REA also
FDIC's budget, other
than to review it with a possibility
over
Accounting
port its contention that
Indiana
of
it than law,
field.
one
not all of these are new of course.
Congress
to appropriate money for the
agency,
electrification
rural
telephone
a
borrowed at
the
into
As of the present time about
from
the Treasury or monies appropri¬ 40% of the nation's farms have
ated by Congress. All of it comes telephones, reports REA. Against
the $100
million REA has ap¬
from insurance assessments upon
banks. These assessments pay ad¬ proved for rural phone projects,
ministrative expenses,
losses, if however, the American Telephone
and Telegraph Company has been
any, and go for the building up of
spending about $100 million per
deposit insurance reserves.
year on rural lines since the end
Hence the generosity of FDIC
of War II, adding about 2,000,000
toward its employees is
under¬
phones.
Currently
AT&T
sub¬
taken at the expense of the banks,
sidiaries are making about 1,000
but not at the expense of the Fed¬
phone connections per day, but
Since
case
telephone now, despite professions of non¬
business, however, under much discrimination against commercial
more restricted opportunities than lines,
it plays up non-profit op¬
when
it
began aggressively to eration from its loans.
build rural electric lines through
REA has some evidence to sup¬
steps
includes
$42,000,000, but this is
most
in
Furthermore,
life-sus- however. REA
zealously sought to
and a pro¬
promote its "cooperatives" in the
of its expense money comes
eral taxpayers.
to
more
1952
additional
transmission
set at
million. The loan,
$1
expansion.
a
as
vider of jobs for its staff.
REA
was
The
however, was for $6 million. The
extra increment obviously was for
prises.
There
"cooperative."
so-called
to be about
of law to finance commercial enter¬
the approach
the
of tiny
one group
value of these companies was said
appointive
pointed as a Republican.
Of FDIC's 1,080 employees, 370
are in "voteless" Washington, D. C.
and the balance are scattered
for
for
provement
For instance,
course, was founded in law. REA
The Board's other
according to REA. Now the total was not permitted to loan to fi¬
member is H. Earl having
central
station current, nance rural distribution lines pri¬
Cook, former Ohio bank super-) both private and government, is
vately owned and managed, and
visor and banker.
He was ap-; close to
90%.
it IS permitted by the telephone
1.
Nov.
"coopera¬
commercial companies was sold to
This fa¬
"cooperatives,"
of
of
with
terms
tives."
cooperative facade.
voritism
equal
are
have
however,
possibility REA will con¬
tinue to favor them with financing
on
1952
materials.
to the
as
tric
telephone compa¬
grave doubts
Independent
nies
favored
lines
900,000
tingent
Their Position
true it would mark
distribution
rural
the other hand, to
tive
company
utilities
If this
for
penditures for 1953
phone
improve¬
Construc¬
$50,000,000, with $27,-
capacity
ownership.
In other
tric
advicp from Congressional critics,
has
insurance
expenditures
because no co¬
operative could be interested.
existing lines and serv¬
ice, without regard
of
and
property.
points out that in one case
it even assisted in bringing into
existence a new commercial tele¬
where, service does
facilitating improve¬
lines
exist
expended $156,000,-
its
estimate
REA
only in financing rural tele¬
pro¬
200,000 spent through July 31. The
just what makes you think Mr. Boodle
plan has not as but largely immune from serious
a
radical
departure
from REA
yet been approved, however. Pay-j political attack.
policy, which in the financing of
ment by FDIC for the hospitilizaWhen
REA
was
launched
by
This group life
to
tion
isn't
of
portion
a
construction
additions
on
estimated at
"—and
of
developer
government
the
of
In the five years 1947-1951,
ments
ested
new
The
1982.
Award
finance
to
company
000
Empire Is Limited
toward
particular
1,
of 100.961%.
company's
the
slow
1949,
bid
a
used
gram.
ing bureaucracy since 1937.
FDIC's generous attitude
its
in
series
by the group Tues¬
won
nucleus of Federal public hous¬
a
it themselves.
season
be
the
getting under way. It was even
with the public housing
authorized
and
first
bonds
Net proceeds from the sale will
that way
program
Co.
Oct.
interest.
on
is
Inc.
Virginia
priced at 101.541% and
was
day
This
programs are
Power
due
are
accrued
issue
hands spite the fact that there had been
corporation's hired
to
want
their
insurance,
3y4%,
bonds
have been taken over.
new
&
headed
Co.
&
refunding mortgage
projects in 36 states but the
number of them means little since
200
rule that
Stuart
$20,000,000
Electric
in about
are
Halsey,
by
comparatively small loan
business.
volume, however, is not taken as
So far as it is known, FDIC a sign that the telephone business
Jus the first government agency of the government will remain
Soever to pay for the private hos¬ relatively insignificant as social¬
pitalization insurance of its em¬ istic-like enterprises go. It is a
ployees.
views.)
own
Halsey, Stuart Group
prospective new empire is the
government telephone business.
The
Effective
"Chronicle's"
it is socialistic in fact
proud
being
and may or may not coincide with
T elephone
telephone
people that it is inter-
Teletype
HUbbard 2-1990
BS 69
@FedFRASER