Full text of Commercial and Financial Chronicle : October 30, 1958, Vol. 188, No. 5790

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

1S39

ESTABLISHED

lteg» U. S. Pat. Office

Volume 188

New York

Number 5790

EDITORIAL

Put On Your

We See

As
*

V '

\

By ROGER F. MURRAY*
S. Sloan Colt Professor of

San Antonio, Texas

,

Graduate School

*

Texan contributor

ful forms of

the feeling of

about

the

close.

It could

thoughtful observers

many

political campaigns

coming to

now

tionary toll

a

hear little

nothing

or

the

on

either have little to

almost

support them or else could

well be leveled at the

as

speakers them¬

selves and their

parties. One

that there is

little real enthusiasm about how

so

scarcely wonder

can

the

needs

Murray studies past performance to see if today's
so fundamentally changed as to
invalidate warning signals now being raised. Not im- '
pressed with the favorable business outlook argument,; [
he examines other grounds offered to justify ignoring of >
past experience with present yield relationships. Con¬
cludes: (1) common stocks are not attractively priced
or grossly overvalued;
(2) inflation fears may subside
before spreading; and (3) risk goes hand in hand with
pursuit of aggressive stock acquisition program though,
he adds, there is no basis for concluding stock prices:
will collapse in the near future. :

investment market has

constant renewals.

voting turns out next week. The fact is that

one

New York City

public's refusal to understand the nature of money
a piece of paper money is a demand
promissory note, i.je., a promise to pay real money. He
deplores discriminatory privileges of allowing foreign
central banks to redeem U. S. dollars into gold; finds
deficiencies in our banking and central banking reserve
requirements and practices; and describes short-term or
Treasury bills a misnomer since they are never paid but
are the
equivalent of long-term obligations because of

hustings but charges and counter charges which

j

supporting

Of

course,

time

and thus

a

.fundamental

them,

of

realization

truth

that

among

on

page

their

numerous

should

"put

income

tax

on

is

Certainly most Congressmen and
considering this matter,
their specs."
The employment of our
supporters,

a

forcing

of

Continued

on

PICTURES IN THIS ISSUE—Candid photos taken at the 26th

DEALERS X

able bonds and preferred stocks. The
record of the past explicitly tells us
that this kind of

porate Bond Traders of New York

appear

a

will not continue.

prudent

buying
warns

yield relationship
It suggests to the

man that he refrain from
equities at these prices. It

of

the

probability that such

purchases will produce capital losses,
in addition to the lower level of in¬
come,

Roger F. Murray

unless, in accordance with the

"greater fool** philosophy of equity

investment, he can find another investor to take the
stocks off his hands at even less attractive yields. This

Continued

on

34

page

by Dr. Murray before the Trust Division of the
New York State Bankers Association, Rochester, N.Y., Oct. 16, 1958.
♦An

26

equities

while

Yet,

contributions.

on

again'dropped significantly be¬

low the rate obtainable from market¬

the

at

to
high taxes whose amounts are
statutory, while continuing on our
course
of wasting our resources.

J. M. Hornor

politicians, and among all too many voters, gives
the picture a still more gloomy tone. If only there
were
even an articulate and vigorous
minority
Continued

and,

popular support that affords a splen¬
did example of the common weak¬
ness dwelt upon by Carlyle.
This activity is that of objecting

The fact is, nonetheless, that

change in the direction of our

a

has

persons

time, are increasing their pop¬
ular support.
Yet a dangerous ac¬
tivity confronts us and receives a

thinking and our collective activity i-s for that
all the greater, and the absence of any
of

some

same

reason

evidence

when the current return

We should be

Amendment

Sixteenth.

predestined this campaign to the charac¬

ter it has assumed.

induced

no

who now
actively strive for the repeal of the

grateful to

larly during the past decade, have left little dif¬
or programs among

not

siasm for repealing it.

politicians during the past two decades, particu¬
philosophy

and fixed income securities at a time

have

law

the paths chosen by both of the

leading parties and by practically all influential

ference in

much enthu¬

There is

investment

that should be abolished.

rather than another,

one group

Up to this
objections to this un-American

faults of certain strongly supported policies. Admittedly,
the Federal Income Tax is an instrument of tyranny

really should be and could be important reasons
for

difficulty about identifying the principal
problem facing the trustee or portfolio man¬
ager in. today's environment. It is the
level of stock prices. Stated in other
terms, it is the choice between stocks

Popular thinking on economics blindly excludes proven

repeatedly to remind oneself that therp

:f-'1

and
Trust Company,

Dr.

savings. Mr. Hornor charges negligence

upon

York City,

Former Vice-President, Bankers

and the fact that

tragic need for basic changes in public policy and
we

harm¬

or

in the

hardly be otherwise. Despite the

public programs,

are

Money and Banking

of Business, Columbia University,

New

forcing of contributions" for the
benefit of government—ranging from tax-spending policies to reduction in gold content of the dollar and infla¬

This familiar couplet from the poet aptly ex¬

presses

objects to what he believes

"taxing

Copy

a

Specs

By JOSEPH MOSBY HORNOR

of all sad words of tongue or pen
The saddest are these—'it might have been'"

;

Price 50 Cents

7, N. Y., Thursday, October 30, 1958

page

28

Annual Dinner of

in today's Pictorial

address

the Cor¬

State, Municipal

Section.

and

in

U. S. Government,
State and

Securities

^

5UNDERWRITERS

Municipal

and.

_

-

"

.

telephone;

STATE

'

„

■

and

623

Members New York

BONDS

Members Pacific

Public Housing Agency
Bonds and Notes

Stock Exchange

Associate Member American

Stock Exchange

Coast Exchange

,

BOND DEPARTMENT

SECURITIES

Offices in Claremont, Corona

CORN EXCHANGE

del Mar,

Beach,
Riverside,
Diego, Santa Ana, Santa Monica

Encino, Glendale, Hollywood, Long

Pasadena, Pomona, Redlands,

BANK

THE FIRST NATIONAL CITY BANK

department

30 BROAD

Angeles 17,

California

of

INVESTMENT

bond

So. Hope Street, Los

DISTRIBUTORS

HAnover 2-3700

CHEMICAL

Lester, Ryons & Co.

MUNICIPAL

OF NEW YORK

Burnhamand Company

ST.,N.Y.

MEMBERS NEW

VORK AND AMERICAN

STOCK EXCHANOES

NEW YORK 5. N. Y.
•
014-1400
COBURNHAM
TELETVPS NV 1-22B2

15 BROAD STREET,
CABLE:

Bond Dept.

Teletype: NY 1-708

r

San
.

Chase Manhattan

Inquiries Invited on Southern
California Securities

New York

BANK

Correspondent—Pershing Sc Co.
—4

Underwriter
*

•

•

Distributor

Dealer \y. '

Net

-

1

To

T. L.Watson & Co.

New York Stock Exchange
-•

•4

^Oilthwedt COMPANY

"1

PALLAS




t.sVs
'

.

n

m.'i

•

PERTH AMBOY

CANADIAN
BONDS & STOCKS

MEMBERS NEW YQRK STOCK EXCHANGE
L NORTH LA SALLE ST
CHICAGO

415 BROADWAY
'

YEW YORK

r

r*
*.--V

-

-

■

California..
Municipals
Municipal Bend

Teletype NY 1-2270
MONTREAL AND TORONTO

*

v.

Department

DoMmotTi Securities
i;

Goodbody & Co.
,

V.

BRIDGEPORT

;

OIRECT WIRES TO

STREET

NEW YORK 4, N. Y.

;

>

FIRST

Exchange

/Ot**0

Maintained

and Brokers

CANADIAN DEPARTMENT

'

25 BROAD

Banks

argus corp., ltd.

Members

t;

Markets

1832

ESTABLISHED

American Stock

Active

Dealers,

40ExcbangePUce,NewYork5,N.Y.
Teletype NY 4-702-3

Whitehall 4-8161

ol

Ainrvu'U

aoo MONTGOMERY STREET»

SAN FRANCISCO 20,

CALIFORNIA

.

|

The Commercial and Financial Chronicle

2

(1766)
r<-"'

The

Banks, Brokers, Dealers only

For

participate and give their

important to

large and experi¬
trading department

you, our

enced

you

MERRITT F. BEAL

the

P. McDermott & Co.
Members: New York Stock Exchange,

private wire

The American News

and
of

improvements

American

much

Established 1920
Member

Exchange

BOSTON

Private

of

Net

the

and

Specialists in

no

of

those

no

c^KAnn

1958

comparable

The

fig-

with

as

were

to

$1.25

heavy

a

120

REctor

in

share,
deficit for
per

STOCKS
For

...

Call

Beal

ble

pre¬

improvement. The results were
a share against

common

deficit of $4.93

a

Securities

*

Atlas

earnings of $0.51

__

*

Sewing- Centers

founded 11-

of New

share in the store in Jacksonville, Fla.

write

Company

York, Inc.

Affiliate

of

Yamaichi Securities Co., Ltd.

was

Tokyo, Japan

with-.a single

years ago

or

Yamaichi

tributing

;

information

current

Centers is because its growth is
developed by adding new dis-

.

corresponding quarter of 1957. The

write-offs

huge

It

eliminations

and

company's growth for many
steadily upward but in
few years parts of the
business were proving to be un¬
profitable and a decision was finally reached by the management
to eliminate all unprofitable units,
This was accomplished by a meat-

Brokers

Today,

&. Investment

Bankers

111 Broadway, N.Y. 6 COrttandt 1-5880

the company operates through 50

2-7815

operation

1957

of

itable units

NEW YORK 5, N. Y.

for

more

than

magazines,^;and';"6n .radio
'Salesmen^ are "not per-

papers,
and

we

is

37 Wall

TV.

proportion-, ^tted

In the kind of market

are

news¬

to

"cold-canvass."

difference,'in

selling

quite

Underwriters—Distributors

|3y expecting" prospective eustomto° much to expect a- genuine ers to voluntarily come into a
growth stock, particularly among store in contrast, to va salesman
the service issues, to sell at 25 making a house call on a prospect
year times earnings, which in the case wh0
has
evidenced interest in
share of American, News may. be ;well yoUr product.
Each salesman is

the
a

abo.ye ^3 0"™951,eari >ngs' and
higher for 1959.

Dealers

Investment Securities

Canadian and Domestic1

given about five leads to contact

The price-earn-

each

day and is expected to report
on them. | The conversion rate * of

sively, efficiently, and broadened in£s J73*]0 is definitely on the
as
expansion was
possible and march
because of the scarcity leads to sales is high with Atlas. «
profitable, with such expansion factor that has entered the marproducts handled by-Atlas are
continuing on even a wider scale, ket as a result of fund buying on manufactured, by others from
patAlthough the company, through a tremendous scale, and the tax ented designs : owned >
by Atlas,
subsidiaries, does some manufac- factor that prevents profit taking Sewing machines are made in Ja¬
rring, such as book matches, it is by important interests,
pan, the largest center of sewing
primarily a service organization,
This is ;a very complicated or- maghine manufacture in the world
operating restaurants, newsstands, ganization and the outlook for todav
ana
vannrm
Hpanpr?
nro
and checking facilities,' retailing further growth under brilliantly
•

SUGAR

Street, New York 5, K T.

There

presently witnessing, it is not

are

operated inten-

were

generated by adve'rtlsihgjh

indefinitely and that
earnings may be expected to

ately.

reported. The remaining prof-

was

STREET

and

a-deficit of $6.67

salesmen;: tLeads for "saleSifien.

company

increase

last

opinion that the sales
should continue

expand

net

years was

the

my

this

to

The

Exchange
Exchange

is

of

1957.

axe

WALL

_

branch offices

our

JAPANESE

The reason I like Atlss Sowing

the

a

in

LAMBORN & CO., Inc.
99

Mobile, Ala.
Direct wires to

.

BROADWAY, NEW YORK 5
TEL.

a

be
developed by
related companies

increase in the foregoing figures" company outlets located in the
demonstrates the remarkable man- Southern part of the United
yield on current prices of aboutwggerial ability that has been cen- States,
the West ancf. Midwest,
53/2%. The book value, at last re- tered on the diversified activities Each center is the headquarters
for
an
average
number : of
17
ports, was about $32 a share after of this company.

Members
Stock

Growth in

NY 1-1557

New Orleans, La.-Birmingham, Ala.

stock it is paying dividends at the
of $1.60 annually, giving a

McDonnell & fo.
Stock

of

by

rate

Since 1917

American

can

financed

first

period

for

common'stock.

New York

earnings.

,

$96,-

stock, its sole capital obli¬
gation being
735,780
shares of

this"

Members New York Stock Exchange
Members American Stock Exchange

tributing units for the company's
products. So called "chain stores"
come in this last group. "

.a^oui1n5

?i cornparec*
the same
Ccirninfis

added,

units lor its products
Is a visible and sure
1958, the company's net sales ap- method to develop growth if manproximated $25,391,000 compared agemerit is capable . . . and manto $19,928,000 for the same quar- agement has evidenced itself as
ter last year, which shows a notabeing capable.
'•

of

On

Steiner, Rouse & Co.

hy the expenditure of cash or the
exchange of stock or both. And,
glowth of a company can be attained by adding additional dis-

last year.
For the quarter ended Sept. 30,

same

ferred

SCRIP

company
company

we note that
months of 1958,

nine

r

compared

Merritt F.

are

acquisition

1957, still

for

645,000

o

&

Van V7*

19 Rector St., New York 8, N. Y«

products

n

sa

bonds

—

1

in

company

While all

not

are

for the first

and remains

it has

^

HAnover 2-0700

the

titl m

$100 million.

ures

tion setup is

simplicity,

.

Sewing Centers

count
Executive, Mason Bro¬
thers, Oakland, Calif. (Page 2)

Havana, the initial

for

nine months

acme

Philadel-

hut in 1957,. because of the elimination of the wholesale periodical
-sa
i?

1957

the

B o ught—S old—Quoted

^

^

Atlas

£^56 w^_^_ ground $172 million,

Company, so
unprofitable

familiar

about the

RIGHTS

Beal, Analyst, Peter P.
& Co., New York

^

affairs

company.
The corpora-

Principal Cities

Louisiana
Company—Mer-

McDermott

-

shop was
the Havana

at

year

sales

old

SAN FRANCISCO

•

to

Wires

in

this

only with the

CHICAGO

•

PHILADELPHIA
*

5

Teletype NY 1-40

4-2300

News

foreign venture.

changes

many

News

elimination

were

120 Broadway, New York
WOrth

' "

F.

.

expansion into
profitable
fields, that it
would hardly
be recognized
by those who

Corporation
Stock

ritt

book

and

Hilton Hotel in

units and such

New York Hanseatic

Associate

so

tobacco

opened

Company

There have been

the

in

Alabama &

Midgley, Head Analyst and Ac¬

A

Exchange and
Chicago Board of Trade

getting the complete cover¬
age you need in your Overthe-Counter problems.

newsstands

P ^a

American Stock

system, plus a wide range
of contacts, assure you of

American

American

contracts have been signed to run

Analyst, Peter
A nationwide

Participants and

City. (Page-2)-

faster.

Thursday, October 30, 1958

.

Their Selections

particular security*

a

(The articles contained in this forum are not intended to-ke, aer
ar£ they to be regarded, as an offer to sell the securities discussed.) '

reach the
OTC markets you need —
help

can

for favoring

reasons

.

This Week's
Forum

A contmnons forum In which, each week, a different group of experts
ii the inyestment and advisory field from all sections of the country

Try "HANSEATIC"
When time is

Security I Like Best

.

•

Raw

—

Refined

—

Liquid

IN JAPAN

.

Exports—Imports—Futures

periodicals,

books,1 magazines,
tobaccos, and foods in
railway, bus and air terminals,
| stores,
office buildings; steamships, piers, public parks, golf

DIgby 4-2727

newspapers,

etc.
Among other services for the
traveling public in railroad sta¬

£"d ^ntes

folio,
V

.

'

.

VAN

V

/ i

....

'

V. MIDGLEY

Head

Analyst and Account Executive
Mason Brothers, Oakland, Calif. '

;

the Atlas Sewing Machine and the
Atlas * Vacuum Cleaner* carry the

v

;
Atlas Sewing Centers

•

'

,

J>PB°Ial .°C??od HoU?e&plr^ MaSazlne- In tmycarries
9»mt
aon,
this
endorsement v

u

Bassett Furniture Industries

economy as a

whole.

,

Nomura Securities Co., Ltd.
61 Broadway, New York 6» N. Y.
Telephone:? BOwlingr Green 9-0187

tions, airports, subways, bus and
; weight .'with'1 buyers
bf ;theii?
ferry terminals, there are boot¬
There is a peculiar psychology
blacks,' drug stores, - snack bars,
,I>rP^uc^In addition to the 50 presently*
vending machines, cobbler shops, surrounding purchases made by
greeting cards, game rooms, and a people. When one buys an auto-■ ■company- owned ; and " operated
broad variety of small businesses mobile, a TV set,

American Furniture

for

our Monthly Stock
Digest, and our other reports
that give you a pretty clear
picture of the Japanese

and

demonstrated management seems riar^
Gf
atg
Britain
Conn
to me to
justify puttmgtWs stock Manufacturers of the well known
u\.a,1y up-to-date growth pent- ,ine of "Universal» products,Both

courses,

Trading Interest In

Frarv

Write

This

is* not

an

offer' or

solicitation for

,

orders

for any

particular securities

,

Life Insurance Co. of Va.

abashing ma-

and profitable.

necessary

Commonwealth Natural Gas

! Branches

other

located- in Rocke¬

are

feller

Activities

LYNCHBURG, VA.
-5-2527—

Private

Wire

to

New

know that
hppnmp

TWX LY 77

ice

York

plant"

City

for

also

include food,

article,
by

serv¬

eating
places in 32 states and including
such luxurious places as the Rain¬
bow Room in Rockefeller Center".

For the

Eight".Sayarin dining

rooms

and

six gift corners are operated
along
the New York Thru
way, and eight
restaurants have been or are about

!•»WEST VIRGINIA

to be opened on the

VIRGINIA

ticut

Thruway.

new

this
the company established six

NORTH CAROLI

taurants

SOUTH CAROLIN

the

on

the

year
res-

right-of-way
Kansas Turnpike.

The

Van

of

V.

Midgiey

ypu

dayme» is •Ci>rried
inventory,, is
ikePt an6 accounting and collect

i

pc«5

to- become imm

i

edia

Jions

are

has

come, very

can

m^ms

CO

:j

.

.

sold "on

an

Over-the-counter
r

brb^uct?

installment basis

about 12 to 15 months periodSk

for 44 Years

The present rate of expansion is
programmed for about three years

or eventually so, at least.
In my opinion, if on6

Abdut -85% ' of *Atlas%

are

tely i.

)^ore valuable market-wise
|

WOf

made), Atlas has granted

invest

dn advance indicating

an

eventual

a
growth situation, one iA
of 85 company outlets ait the
which it is* easily recognizable a
?
period: . Salesmen per
'growth exists, you can expect the jOutlet wilb be moved"up to 20
**0 »vhere it is
understood to be oper- investment to become more Valoutlet .\yitna sales quota of
:
ating thirty bowling alleys-«-a first uable, everything else being equal. j$25 to $30 thousand per man per
f: - venture int^ a very profitable side I
Growth id a company; can'-'b^j?®?1:*-'
arithmetic bring?
^
company

,

they

day

expects, them I

Connec-

Early

se^

a Place from which salesoperate, direction 'of sales-!

valuable,«not-' distribution frapehises .to-42 dealwithstanding ,erf ;wh° sellI.Atlas productsjundee
there is the selling, jurisdiction of ; the coin-}
use
value not PalW- '- New
company' 'operated
m easured;
Centers are being added at the
However with rate; of about one each month,
the purchase which adds to gross, business and
of stocks ' oe consequently net. Herein lies part
real estate one bf th^ company's growth potential!

hospitals, offices, and "in
feeding.
Early this year

the company had about 300

MUNICIPAL BONDS

totearn

ing' but
men

Center, New York, and
Penn Center, Philadelphia, and in
Hilton, Sheraton and other hotels.

STRADER and COMPANY, Inc.
LD 39

usef ul

V1

active in connection with the new
Penn Center in Philadelphia,

*1
-

r.

r

i

RICHMOND, VIRGINIA




-

line

—

and

™

we

are

informed

that

J^

"

.

developed internally wherein

$

new

Continued

on

page

2%

:•'

Eamuhe*

48 Froat Street
Chicago

•

mi;/
NearYerk4,II.Y.

ium wwmmoo\

Volume

183

Number

5790

.

The Commercial and Financial Chronicle

.

.

(1767)
T

,7

r-.

.*

Ail

,

*:■

v '

'.'r

\

..

' t.S-r

+s~%

-/'J »* 11

i

f>

i

»

yl

-

t

»i *1 i

-

'

,

e*

•

INDEX

Appraisal of Dow-Iones

[iCHTtnsM

B.&

Articles and News

Page

mmam

Today's Investment Program—Roger F. Murray

By NICHOLAS MOLODOVSKY*

Put

White, Weld & Co., Members, New York Stock Exchange

An

After

showing why the price-earnings ratio approach may be
inadequate, stock: market economist discusses other methods
de valuation of
market

a

Finds

stocks.

common

that investors

Your

on

of

Dow-Jones

—Nicholas Moiodovsky

,

WITCHCRAFT

Specs—Joseph Mosby: Hornori—_———_,j__ Cover

Appraisal

Industrial

When we're

Average

_4_—,

—

and

'

not

Halloween,

on

Hong Kong: Funnel for Communist-Economic Aggression
A. Wilfred May
^

create

AKD COMPANY mmmrnrntrnmmmmmK-

Cover

flying brooms
take obsoletes

we

'em into cash!

turn

.___

value

based

market value in turn

on

earning

average

moves

in the

and that

power

direction of

Free World Progress and American
Responsibilities

intrinsic

an

/

value.

Projections of the latter suggest that even at its present
high level the Dow average is still reasonably priced.
T

„

3

i

t

■

Philip

.

—A.

During most of 1958, prices and \ fice.: T hem ood predominant
earnings of common stocks have among these men was described
beeri moving in opposite direc¬ by the capition "Market Baffles
tions. Divergencies in their rela- Tape Watchers."
; ■ ;
,
- <

Obsolete Securities Dept.

Cortney
99

Current Bond Market Trends and Bond Financing Procedures

.

B.

WALL

STREET, NEW YORK

Telephone: WHitehall 4-6551

Hager, Jr

;__

.

tive action
not

an

Two

are

unus-

ing,

at; develophient. This
how-

e v e

r,
they
have been so

striking that
many

invest-"

o rs

July high to
its October

nomic

low, the Dow

Nicholas

Molodovaky

in

In

—Leo

for

A crescendo of doubts

ket is not

not

only

Ira

entire decline

but

impressive

an

unprecedented
the

;

established, by

margin, new and
highs. Rarely has

of

progress

the

such

powerful

a

bull market been looked upon by
so

with so much distrust.
Throughout the 12 months of its
many

duration to date, the most repre¬
sentative opinion was that stock

was

accom¬

panying rising prices.
Last August, as the D J I A was
reaching again toward its 1957
high, a financial writer, survey¬
ing the collapsing earnings re¬
ported for the first two quarters,commented Jn

a

leading

newspa-.

"the securities markets
caught in one of the most con¬
fusing economic experiences. of
that

per

the

what
as

history; For the moment,
tape is spinning out

ticker

_'a tale told by

—C.

an idiot, full of
fury, signifying noth¬
ing-. The babel of prices com¬
ing from the securities ticker is
so incongruous that there is little
.

.

of extravagance in the

statement

stocks

Even less

/

This wonderment and

sense

of

unreality continue to pervade
boardrooms

and

research

staffs

alike

despite the fact that business
is improving
and that earnings
should start reflecting this change
better.

for the

line

in

of - the

one

financial

read

a

For

of

I

Martindell.

*

Recessions—Milton C.

Securities—Jackson

and

Lightner__

20

J.F.Reilly&Co.,Inc.
Members Salt Lake

the

;

—:C1 arence.Manion
The

;

20

Growing Opportunities in;Property

—Roy

F.

Cardinal Roncalli Is New

John XXin__

is

.

'

'

Yes, hut

be

.

of

.?

.

*

t'f

Two

(Boxed)
•

.

Direct wires to Denver St

:

10

■

-

-

i

'

-

Board's

make

in

if

it

than

did

Warning

Indicator

Hoped

for

in

1__L_

Method

Pacific Uranium

Chuck Full O'Nuts*
•

See It

(Editorial)——

Cover

___

Bank and Insurance Stocks

road-blocks

*An address

by Mr. Moiodovsky before
the
Association
of Customers
Brokers,
October 27, 1958. Opinions expressed in
this talk are the speaker's own end not
necessarily those of White, Weld & Co.

T

t

■

48

Singer, Bean

8

Dealer-Broker Investment Recommendations

8

Eirtzig: "Is Gold Superfluous?^

v

-

29

Coming Events in the Investment Field

an

46

not

Direct Wires
San Franeisco

—!

Mutual Funds

38

_______

12

—

N. Y.
•-

to

Los

Angeles

.

Philadelphia
NSTA Notes

inc.

40 Exchange Place,

Teletype NY 1-1825 & 1-4844

17

Indications of Current Business Activity

Mackie,

8c

HA 2-9000

12

From Washington Ahead of the News—Carlisle Bargeron

Chicago

Dallas

'

'

"

News About Banks and Bankers.

22

,

Our Reporter on Governments.—

39

Our Reporter's Report

the blueprint.
of broader signifit

mental

■

'

Business Man's Bookshelf—J

-

45

over

sake

•

-

Prospectus upon request
As We

attempt at expressing
value, i.e., its capital

go

-

.

Regular Featurer

.—

.—J—

„

Syntex Corp.

24

'1.

Public Utility Securities

47

Railroad Securities

!

Seaboard Life

-

'

^

i

•

46

Prospective Security Offerings

44

Insurance "A"
*

i

•

were

Salesman's Corner

Securities

prominent among the obstacles
which prevented investors from
accepting, without protest, the
reality of soaring prices..' "L;.
One difficulty was the unusual

accompanied by photographs
in a brokerage of-

City

Champion Spark Plug

ap¬

sense

no

more

Early

Ratio

Securities Now in Registration—

customers

Lake

Duffy-Mott Co.*

•

/

Capital-Output

Rules/'

no

;.

com¬

as

vacuum

*

Top Anti-trust Legal Experts to Address Metropolitan

Conference

shall do so by means of
J I A-^the most popular of

Two

Salt

*

16

'

c

16

—

Economists

Stock Yields and Bond Yields

widely
xhe article

f '

Teletype: JCY 1160

12

as

•

DIgby 4-4970

'•

21

Pope: Will Reign

'

Exchange PL, Jersey City

Improvement Loans

;

Cooke

1

'•

'

^

measuring yardsticks of com¬
mon stock prices.

head¬

City Stock Exeh.

'
.

all

most

pages,

~

and

cance, we

r

was

Meany

Oceans—Roger W. Babson 19

.

well to

be

request

on

15

-

that no architectural .•designexists. for one of the tallest struc¬
tures of national wealth, it might"

the D

month

Prospectuses

Balderston

Before accepting the find¬

ing

_

14

Keep Government Limited in the Interest of Freedom

an

stock's

.

last

company, inc.

13

Spahr

•

"Many Are Mystified by Con¬
tinued
Rise
of
Stock
Prices"
late

Canby

than two weeks

could

would

worth.

Bennett

*

\

..

irrelevant, number

•*.

asserted

value

a

stock

a

F.

States—-Walter E.

Inflation

praising common 'stocks is frus¬
trating and dangerous. The price
and

United

The Wealth of Nations Lies in the

the title of a financial col¬
proclaimed that. "Booming

the

investment grade com¬
is really worth."

so

Market Defies All

of

the

18

*„
denying the impact

no

as

represent

an

it

as

has been

Such

duffy-mott

18

from the pricing
many" people be¬

of what

stock

reflection .of

pletely, absent

that, today in Wall Street nobody
seems to have any definite
idea
mon

a

true that value

umn

in

Politics

on the prices of stocks;
certainly an important factor
in the clanging relation of stock
and bond-yields.
But can it be

lieve?

11

Unemployment, the Cold War and Election Y'ear Claims

It is

and

sound

much

speculations

There is

ago,

__i—i_

i

Taking Another Look at Consumer-Credit Controls

of inflation

to be best describable

seems

so

quiet desperation."

of

corporation

10

.

feverish

are

recent

.

Cobleigh—

Power—Sen. Wallace

was

.

U.

Science

It : apparent

points.

retraced

—

Prosperity Without Inflation Through Sound Government

this

prices had lost all contact with
reasonable measure of value.

hundred

one

o'nuts

60's
__

•-

any

lost

since

of the Fabulous

'

anomaly, the editorial
typical of present thinking.
In addition to improving business,
the "impetus for all this buying
is the fear—or expectation—of in¬
flation.
The reason why people are
willing to pay more dollars
for an equity than they would by
any traditional standard is a wide¬
spread feeling that the dollars
used to pay for it will not for
very long be worth what they are
today
The present stock mar¬

1957
has

Cherne

—George

account

chock full

Dictaphone Corporation: Belt Line Conveyor of Words

judgment."
to

—

little

makes

present prices stock buy-

trying

—L___.

•

—

Are .We Now in the Foothills

;

are
not only discounting the
improved corporate earnings just
ahead, which the market would
normally do, but all the foresee¬
able gains for some time to come.
It has been pretty hard to justify
this market boom by sound eco¬

its

average

market

At

Financing

,

Role—Robert.C. Porter—

v

ers

were

shocked .and
bewildered.
From

J

an

sense.

S, Ljneii-

V Financing the Replacement Fleet and the Investment Banker's

days prior to this report¬

booming

experi¬

enced

—John

editorial of a well known
financial journal, entitled "Puzzle.,
at Broad and Wall,"' stated "that;
"if you look, at the usual statis¬
tics—the".relationship of earnings
to stock prices, for example—the

U

time,

The Broadening Scope of Municipal

The Market

y,

.

23

_

and You—By

Wallace Streete—

Altamil Corp.

1 16

—

Hie Security I Like Best

|

,

McLean Industries

2

!

"

Continued

on

page

The State of Trade and Industry.

30

Washington and You

5

48

AIsco, Inc.

William B. Dane

Epsco, Inc.

*

l
Publish**

For many years we

DDrrrDDFIV CTflPHC

have

mClLHHUJ 0 I UUItO

specialized in

'

'

'

-

'

*

^

*

*

>

Copyright 1958 by

Company

Spencer Trask & Co.
New

York

Stock

25. 1942, at the post office at Nes
York, N. Y., under the Act of March 8,187S
*ry

Reg
B.

U

8, Patent Office

DANA

COMPANY, Publishers

25 Park Plaee, New Yerk 7, N.
REeter

'Members

Reentered as secona-class matter Febru

'
-

'

'

Weekly

flNANCIAL CHRONICLE

WILLIAM
f

•*"

Twice

Tho COMMERCIAL and

2-9570

.

,i
„

HERBERT D. SEIBERT, Editor & PubllBlief

WILLIAM BANA 8BIBEBT. President

Exchange

r

•

-

'

"■

<

Subscrlptlonb

Possessions,

.

,

,

in

United

States,

U.

Territories and
Members
Union, $65.00/per year,

m V. FRANKEL & CO

8
o

Pan-American

i

Dominion
of
Canada,
Other Countries. $72.00

$68.00
per

per

to

INCORPORA1ED

yea?

39 BROADWAY,JEW YORK I

year..

'

V

.

.25 tfROAD ST., NEW YORK 4, N. Y.

y Thursday, October 30, 1958
i )
* - • -•
*
CI
;
;
1.1
i
; ,
,
other Publicationa . ^
Every Thursday (general news and adrertislhg Issue* and every Monday-(complete statistieal issus
asarket quotation '$45.00 per ydai
(Foreign Postage extra
records, corporation new$, bank clearings (
Note—On account ol the fluctuations li
state and pity news; etc i / c< ' l . >. ■>
•
the rate of
exchange,
remittances fo
Other Offices: .135 8outh La Salle 8t
foreigi
subscription
aao
aOv^r*tsement
.

-

„

TELEPHONE HAnover 24300_
Boston

Albany
v

.

."-:

/-.Nashville.

-




,

.

-

"

J
Chicago
Scbengeetady ,

TELETYPE NY 1-5
,

^

,

/

-

Glens Falls .
'■ •'
WdrsesUr...

3,

XH

(Telephone STato 2-4518)

,

,

v

.

WHitehall

3.3950

1

!;
■

,

-

Ohicage

i

Subscription Rates

' «

Y.

9576

to

\

must ho made in New Tort funds.

Teletype'NY 1-4040 St 4041
Direct

Wire

to

PHILADELPHIA

'

4

The Commercial and Financial Chronicle

(1763)

In the

Hong Kong—Funnel for

of the over-all trade

case

thetic to them.

through Hong Kong.
Depicts techniques of price cutting and dumping, and the suiting of trade policies to political aims. Concludes the Commu¬
nists' economic aggression is even more important and decisive
than "Quemoy."

be

;

.

white

the

by

the

Formosans.

the

China at

Maneuvering:

capture a market initially,
and perhaps to unbalance it for
political purposes, the Chinese will
engage in the most ruthless price-

without

cutting,
cost

declined by the substantial total of

brick.

safely

canned

One of 10 de¬

stanced in the

brands// / /

about 100 food

■

These achievements

by. Commu-

shops which

J hist" China for. the.

since

early

| transcend economic return, includ¬

1957

have

ing the conventional striving lpr

been

exclu¬

far

consumer

theirs.

items in

.

*

sively distrib¬
uting

items
Wiltred

produced
the

on

May

Coramu-

nist China

mainland, this institu-

tion is remarkable

variety and
chandise

as

to both the

pricing of the

offered.

In

one

mer-

show

window

are attractively displayed
bright yarns, sweaters and other

woolen

goods,, in another, shoes,
sneakers
and bedroom slippers;
silk and woolen piece goods in
flashy colors; in another a display
of ivory carvings; and a fourth
window shows

a

complete line of

radios and record players. Inside,
the shopper is offered men's colored nylon
at 24 cents

foreign exchangeAyj^eh is .nonnal
this Switzerland-igh" free .ex¬
change market. Political motiva¬
tion, apart from the economic, is
evident in various ways. The price
ticket savings, of course, create
vast
consumer
goodwill.- Again,
the
constant
shipment* of new
products, not producible in large
quantities but for prestige purposes, as tape recorders, bicycles,

in

to

1957;:-

Refined

This

annual

rate

of

has

been

in¬

;

;

50,000 cur¬
rently. .Red: China's coal exports
here, at 164,000 tons in 1957, were
up
900%
over
the
1955
level,
severely hurting Japanese and Indian exporters.
'/
; •
:
■

Sabotaging Japan

automobiles in the

amount

of

10

way of impressing the consumerprestige-wise—and affording good
propaganda mileage,

elastic-top nylon socks

Also

highlighting

the

political

her

grey^oods requirements, with
practicMly "nothing coming from

China,

the Communists sup¬
84%,- and the Japanese only

ply

In the textile

area here, the state
trading companies from the Com¬

(in the dollar equivalent of the Hong Kong price tag);
pure silk hose at 20 cents; white

motivation, is the situation re¬
fleeted in our cited differentials
in sugar. The successive price cuts

munist mainland have consistently

and colored shirts, cellophanewrapped, at $1.70 versus $4.80 for
their U. S. counterparts in other

in sugar here by Communist China
have occurred while siie has been

sary

stores; ball point pens (which this
can testify,
really work!)

writer

at 20 cents; large electric fans at
$2.50; strikingly colored thermos

bottles
area

at

$1.50, etc. In the shoe
particularly, many of the lo-

cal

non-Communists

me

as

to

testified

to

the

quality-equivalent
price advantage in the Communist
stores.
shoes*
while
are

in

Best
are

ment of the Formosans

as

well

as

for the future capture of the business market.

Quite varied

the efforts

are

en-

gaged in to impress the community
of political fence-sitters and anticommunists.

For their

edification,

competition

have manipulated

undermine
all

by

neces¬

the

prices, to
Japanese trade—

while

severely rationing the
grey goods in their home

same

market.

In

addition

to

the

price
tag weapon, the Reds broadly use
credit terms as a
wedge—driving
through as long as two-year ma¬
turities, against a mere two ' to
three

months

by the Hong Kong

and Japanese firms.

nists'

Bank

of

The Commu¬

China,

sometimes

Communist

China's

cement

com¬

ing into this market has risen by
28% over last year,' As the- direct
.

in

the

newest

cars,

and

Hungary,

the mainlanders obtained via Mos-

from

terms

on

long-term

capital,

drastically undersold by cow. And on the latest October 1 loans to letters of credit.
China Shop group is a long Revolution
The crucial effect of this
Day, the local citizenry

list of miscellaneous

consumer

ltems

was

vividly shown, through

a

dis-

offensive

directly

on,

the

trade

Hong

story of trade aggres¬

sion has been wreaking havoc here
in wheat flour, paper, and rubber

tires; each of these industries feel¬
ing the dire effect, more and more,
Communist

China's' dumping
superaggressive trade

other

efforts.

'/

-

.,.

,

Red China is able to sell at cut¬

throat prices
her

because, along with

abundance
she

natural

of

has

with

re¬

state-subsidized
state

-

controlled

prices and free of criteria. This
gives her complete freedom of ac¬
tion

her

in

trade

maneuverings.
her
export trading
increased by its channeling
through state-corttrolled trading

Likewise

is

entities.

This is helpful to her in
in addition to pricing. For
example, it enables their dumping
of goods, even in the face of de¬

ways

sire of the distributor

or

tomer, by their foisting
distributors quotas of
shipments of the same

items, - often

the

on

cus¬

to their

successive
or

kindred

choking

them with
surpluses—all adding to the flood¬
ing of the market.
.%'//V;.
••

This

state

cilitates

in Malaya and Singapore,
operations,
production
and
earnings of the Green Island Ce¬

off

control

-

likewise

far

the

by sporadic turning
the

of

on

and

Or again,, the
be done to gain
in a community.

screws.

ment

Company, Hong Kong's pro¬
ducer,- have/ become painfully

price-cutting

reduced.

This motive would apply here in

Since the

the

local

beginning of this

Green

has been forced to
three times
Chinese

metric

to

Company
reduce its price

come

product

ton).

year

Island

closer to

(now

And

$17

China

the
per

official

may

general control

Hong Kong, which does not afford
Red

China political representa¬
tion.. Dumping may also be used
to undermine

tor,

a

against

as

tionalist

political competi¬
the Chinese Na¬

Formosans.

The

latter's

sources

reveal that she intends to

Takoo

double

their

has been forced to mark down the

plant plans

output.

to

A

double

Canton

its

export
volume of 300,000. tons, and an¬
other new plant in Ying Tak in
Kwantung Province, when com¬
pleted, is scheduled to produce
700,000 tons annually.

prices

Sugar
of

again this
keen

its

the

In
Red

food

Canned

goods

is

painfully
from

products
on

Company
again

Cold

War

and

account of the
Canton.

Technique Here

While Communist China's trade

is

ruthless

generally,
largely a
sideswiping operation, because she
wants to keep her in both political
and economic business. Hong Kong
provides these, among other prac¬
tical advantages—
towards Hong Kong it is

too,

area,

aggression

Refining

year

aggression

Food Invasion

.

competition from

The

the

severe.

Communist

(1) Generally she is like a ten¬
who, for the/landlord, does
own
decorating at his own

notably Singapore. A leading local
cannery merchant complains that

ant

similar

his

have

compete its British opposite num¬
bers in a variety of fields,
ranging

in¬

nied

in
both
Hong
Kong and Southeast Asia, particu¬

West-

which manufactured

Czechoslovakia,

this

on

v

„•

larly

oer-r

dumping

tral bank,

in

dependent

same

the

result of Communist China's

sistent

freight

come

.The

prompt and " adept
price cutting and dumping of par¬
ticular items in anticipation of
competitors' shipments of the
product.
This may be accompa¬

cheaper,

and

half the price of those offered
the
non-Communist
shops,

goods

Likewise
the

coun-f

midst imports of

sneakers

25%

rubber boots

Hence, it
is evident that the price-cutting
has been done for political harass-

the

10-15%, and further when

the

functioning in the role of a cen-r China have flooded the markets
ern-type of 60-ton aluminum tank
continually tries to out- here, as well as Southeast Asia,

quality men's leather
about

net importer of sugar.

a

underquoted

fact

exports to these

tries took place

now

2%.

In

cement,::

no

1956

wholly
dustry).

power

the products, and at higher prices.
To date this year, the quantity of

over

Epitomizing the sabotaging of
sewing machines, a replica of the Taiwan — whereas in 1953 Japan
Parker 51 pen (at.$3), and even supplied ^ to- Hong Kong 32% of
promised by the end of the year,
has served as another important

first

only 3,000 tons in 1955, went up
16,000 tons; In 1&57 and to an

is

industries

of several food

case

Hong Kong.

lactured

receipts from the mainland

-sugar
at.

in

of

Aberdeen wholesale market

re¬

.

yards

selling

(whose entire colorful community

sources

; In cement noticeably, Red China
has
been
conducting f the most
Typical is the record of its cot¬
ruthless
four - cornered
warfare
ton cloth imports into Hong Kong.'.
with Japan, Hong Kong, and For¬
Totaling 8 million, .yards in 1954,mosa;
This
she', began in 1956,
they have steadily. grown to 100
prior to which time she had manu-;

million

local

the

■

Propaganda Mileage Rung Up

and

to

factor; and with sporadic

mosa

of

relation

newals of this in the midst of price
maintenance
when
a
market
is

360 HK dollars, Communist China

Commies'

the

Cantonese fish at 50% of the Hong

and

To

Kingdom, Japan,
United States and Belgium all

Thursday, October 30, 1958

.

while,

of

Price

over-all

from the United

partment
stores

listing of merchants who buy from

implica¬

product. And the same with actually increased her shipment
goods; Commie tomato by $126 million. In fact. China has
juice is 12 cents versus 17 cents been the only one of the 11 ex¬
for
the corresponding size of porting countries here to score a
gain this year. r/
American and other
( v
// ;;

triguing 75' by
125' four-story
structure

side-swiping

hefty

exportimport record for the first eight
months of this year which shows
that while Hong Kong's imports

6V2 cents per pound versus 8 cents
on
the next counter for the For¬

from Communist

in the desire to

seen

.

Kong fish prices has crippled the

camphor products; with the black¬

Kong's

lighted

Products Co.

sugar

'

trouble,

host of significant

a

out * of

unsympa¬

impress "neutral" foreigners with
new products;
in the evident ef¬
forts to beating the Formosa po¬
litical opposition in sugar, hogs,

Quantitatively, the progress
achieved by Red China is high¬

inger Street reveals newly arrived

in¬

most

are

tions.

ping center of this colorful cosmopolitan community, is the China
an

the

has

KONG—Outstanding in Personal inspection at the large
Vouex Road, humming shop- Wa Cheong grocery store on Pot-

store,-

causing

Hong

HONG
Des

trading are

The tex¬

picture reveals that while un¬
dercutting of Japan and India
throughout Southeast Asia may

economic warfare is demonstrated in and

to* * put

Other manifestations of political

tile

which Communist China's

in

ways

-

by the Communists in and around
Hong Kong are a broadly signifi¬
cant indicator * of what the non-

By A. WILFRED MAY

May lists various

cutting- -prices

business those who

Communist world faces.

Mr.

in

/ picture, the techniques practiced

.

expense.

mainland
canned
goods
captured the local market at
prices one-third of his. Red China's

biggest canned food
Kwantung Cannery

plant,
of

the

(2)

She

is

as

convenient

a

"Switzerland," through whose free

running- the gamut from
plastic containers to sewing machines to umbrellas. '
' /'
v

'
Kong manufacturers,-as depicted
f.
P Y
Communist celebiation to me by the Secretary of the
Hong Kong Cotton Spinners As¬
flags, how control of the "neutral"

;
Similar price differentials are
clearly manifested in the food area,

Chamber of Commerce has been

sociation

taken

important mills, Mr. Charles Silas,
has been to reduce local
profits
by 20-25%, With cuts in some pro¬

of canned fruits every year. Large

medium for

competing shipments of livestock

of

duction rates by 50%, and initiat¬

day.

ing of

China's commercial agent in Hong

,

,

.

,

.

over.

..

and

director

of

several

some local unemployment.
weaving and knitting plants

Canton

port foreign exchange may be ac¬
quired. In the acquisition of ex¬
change from private overseas trade
alone to turn out 150 million tons sources, Hong
Kong provides the
went

into

which

also

operation

will

enable

that

recently,
district

getting large amounts
directly to them
come
from Canton
every
through their Bank of China,
NG Fung Hong, Communist sometimes paid for at arbitrary
remittances

rates quite unfair to the sender.

Kong for foodstuffs, has constantly

(3) Through their retail shops
doing business here; the gaining
of exchange as long as
Particularly dractic price-cut¬
they keep
ting in this market has taken place head of hogs stored in the Gov¬ going here/
••'/
in
(4) In addition to "providing a
building gravel and stones, ernment's slaughter house in Kenwhere the price for-the goods de¬ nefy Town, for the supplying of "window" on the capitalist world
livered has been no higher than Hong Kong's three million popu¬ in the political avenues, it affords
>
;
•
r know-how in the trade
the normal freight charge from lation.
spheres,
The Red's pricing strategy has
Canton here.
."."/So some measure of Communist
These Communist maneuvers been clever and effective, with co-existence with
Hong Kong will
may be characterized as politically their success great in manipulat¬ no
doubt continue
indefinitely.
motivated since the more ruthless ing the market so that no im¬
Nevertheless, the Communists' ag¬
grasping for control of the mar¬ porter dares to bring in large
gression of the economic kind
ket, particularly in textiles, has imports of livestock from other
stemmed from the break with the sources, with any chance of suc¬ against Hong Kong and Southeast
Some

Like

have been forced to shut down.

on

hand

a

stock

of 2,000 to 3,000

head of cattle and

to

40,000 to 50,000

A

a

block?

Nisi's Japanese
Government; and
as at least
"quasi-dumping" since

Call...

the price and credit sacrifices have
been made concurrently with their

domestic

Marketing Department

Merrill Lynch, Pierce, Fenner
70 PINE STREET




....

Offices in 112 Cities

shortages. Clearly, Com¬

munist China has been

political

&

Smith

NEW YORK 5, N. Y.

aims via

cessfully competing with the Com¬
munists and making a profit.
In another food

ruthless

trade

the Chinese

Communists have shown in
ferent
of

furthering

area

manner

living

ENCE."

in

a

dif¬

their strange ways

"CO-EXIST¬
Over recent months they

Political

strategy

as

serious, if not

that

manifested

in

as

obvious,

the

as

recurrent

political crises in Quemoy!

sweet

have been
sabotaging the local
is fishing industry, shooting up boats
likewise manifested in their favor¬ of the small helpless fishermen—'
the represented purpose being to
ing of merchants who support
get them to join the Communist
them politically (the USSR's old
cooperatives, which they are finan¬
Amtorg technique), and conversely cially incapable of doing. Mean¬

aggression.

Asia will continue, as a threat just

S. K.

Phillips, 5r.

/Samuel K. Phillips, Sr., passed
away Oct. 21 at the age of 75. Mr.
Phillips, a Governor of the Phila¬
delphia-Baltimore Stock Exchange,
was senior partner of **aimiel K. *
Phillips & Co., Philadelphia.

Volume

Number 5790 .'.

188

.

The Commercial and Financial Chronicle

(1769)

•

5

tory pacC'/that it calf' cons
ihiprove the standstot bf living of
the people, and that the rewards
to the people and the distribution
.

(f^
The

.

FreeWorld Progress and

Steel Production
Electric Output
;v; •''

State of Trade

■

Carloadings
Retail

1

of national

!

Trade

'

Auto Production

Industry

Business Failures

The

in changeover to 1959 model

cars

~

occasioned by

At the

same

time it has made the

car

makers

reluctant to place orders in adequate quantities for steel and
materials pending the settlement of these labor disputes. -

other
?

>

The present shortage
all-out effort by the

r

of cars in dealers' hands will necessitate
an
manufacturers to step up production to
supply them with adequate stocks and in turn will Call for the
placing of orders for steel and pther materials in greater quantities
from' now on. This building of inventories by the auto industry
will provide further stimulus to the recovery by boosting produc¬
tion and jobs not only in the steel industry, but in other lines as

,

First and
of

Our survival *. and, whether we: like it or hot, * that

a

In

quarters, it is felt with the introduction of the

some

new

\

The

substantial increase in the third

and corporate profits is not yet available, the agency commented;
"it is clear that the larger part of the 1957-58 decline in national
income has now been recovered." i
;
I v
The" department declared that 'second quarter national income

.

-

.

depends a'
great deal orf
the degree of

from

the $350,600,000,000 annual rate for the first quarter, the
low of the recession. However, the second quarter rate was still

$16,300,000,000 below the high annual rate of $368,700,000,000 in

responsibility
nd

a

;

V

n e s

of 1957.

difficult

annual rate of

an

<

But the
as a

■

.

.

■.

expansion since mid-year for the rest of the

whole "has

undoubtedly brought about

a

wni eh
Am

significant improve¬

'we

is that we
shoulit prevent abnormal, or ex¬
aggerated swings of rihe 'business

;

And

up
,

*

1

e

International

come

and

ac¬

in

to miniachievements simply

be influenced bv material

.

poorest production

year

since

time in the past, free
enterprise is on trial as an effi¬
cient form of organization.
As you are aware, Mr. Khruschev stated only six' months ago

the

At thd

time, it added; steelmakers, are looking ahead to
despite the possibility of a strike over new
contact demands. Carefully worked out estimates are that, outputy
in 1959 will hit 110,000,000 tons. This would be the fifth best year
•

same

the field of peaceful

•

lower,

the mills

78,000,000 tons.
;
:
•

operated

systems .are inseparable.

. If
wq
cannot.establish the superionty,of
our economic : system,
many na-

In -1949, when capacity was much
at 81% of capacity and turned out

-

.

tions

.

Sheet

strip

demand

has

all of
ous

that demand would level

One buyer for an automotive

United States car makers will fall far short of their October
be

.

;Continued on page 36




_*»

•

•

•

l

"Responsibilities of
Affairs."

soundness of the dollar.

We should not hesitate to shout

loudly as we possibly can that
dollar has become an unsound
currency. If is up. to us to make

as

our

inflation,^ve been^made to this

fsf,

rasuItiag dome9tic evils of
asc^ IS,,7^3 inflation are quite obvious; but the

a Jrs

their influence and power are used damage: of dnflationary policies
to correct defects. anu^hortcqm- throughout the worldi to unity and
x0UI
prbgtess are even-worse. Exchange
PO""CS oi .limerent in controls; I import ^quotas, impeditne tree enterprise system. ... :
mentsvtq international trade, are
Business Must Meet the Challenge dirwtly attribUteble to ir^sponsif

:

•

The businessman s unique role
be as the most active
guardian of the free market economy, which is being challenged today as never before. To prove its
superiority the free market economy must demonstrate that it can
grow and innovate at a satisfacshould

bleinflationary policies. The;unity
of Europe; be it said- in passing,
jviii remain

a

chimera unless

lot

of

our

/*'
free

The
rency

deterioration of

our

Continued

on

page

'

Service

;
/

■

"

:■

'•

'v

'

s

■

"

■

•

■

., '•■ ■■■

our

to

troubles.

me

:VT-

society is

It

seems

obvi¬
-s:,v /

that the shape of our

,

Among the domestic foes of our
society I will mention our

free

»An address by

Mr. Cortney before the
Boston Conference on Distribution, Bostotlf Mass., Oct. 20, 195s.

^ -

Dean Witter
ScCO.
Members
New York Stock Exchange • Pacific Coast Stock Exchange
Midwest Stock Exchange • American Stock Exchange

Honolulu Stock Exchange • Chicago Board ef Trade
and other leading commodity exchanges
Private leased

internal enemies.
,

^ ••

.

V

'

radiotelegraph,

circuit to Honolulu

,,

SAN

FRANCISCO

•

LOS ANGELES

•

cur¬

will hot stop until such time

;

.

con-

ditions for free convertibility' of
currencies- are restored.;.

'

■

society is determined not only by
government, but by business lead¬
ers, educators, churchmen, journalists, etc. It will require a great
deal of foresight, vision, wisdom
arid
enlightened aloofness from.
greediness to defend our free so¬
ciety against both its external and

somewhat. Some mills still believe this
will be the case. The key to the situation probably is automotive
and early reception of the new models has been encouraging.

•

A.Z

literlly in the hands of our people.
We are too prone to blame the
government and the politicians for

off and perhaps decline

firm recently received his third
November production schedule boost in 45 days. His steel sheet
suppliers already are one week behind originally scheduled delivery. He believes that another production increase will put him
in a squeeze-for November steel needs, concludes "The Iron. Age."

i.

on public policy will be ditticult country almost without opposition.

—

The

ening belief that December steel output will be better than had
expected. This is based on an expected pickup in deliveries
to auto companies once their labor problems are settled, declares
this trade magazine.
were

a danger_'
situation, and our responsibil¬
ity is the greater as the interna¬
tional monetary system has come
to depend a great deal on the

ous

However, it is my monetary discipline. It is noteopinion that if the worthy that recent decisions for
viewpoint of the responsible busi- the further monetization of govness
community is lacking from hrnment debf the root, cause of

outside the communist

now

fateful destiny.

been

Earlier forecasts for December

We have indeed created

its

for

*

The current slowdown in deliveries to automotive is strength¬

.

gbvernment

and indifferent to bother with our

been strengthening despite
holdups in deliveries to some struck auto plants. The market is
particularly tight in the Chicago area, where some mills have
fallen behind on their delivery promises.
and

a

has to operate.

may/reject private entersoon to find that at the
same time they have rejected their
freedom and independence.
When I observe the complacency
of the great majority of our people in the face of the dangers
which are confronting US, I am
wondering whether they do not
understand the gravity of the perlis, or whether they are too lazy
prise

support in> heavier steel products.
-

on

considered

camp,

perking along at a fair pace on the strength of demand for sheets
and strip and galvanized sheet, a pickup in orders for hot and
cold-rolled bars, a better tone in wire orders and a smattering of
„

itself is

before. It is true enough affairs. We have destroyed with
that the destiny of our free society our own hands the international
depends primarily on the political gold standard, and we. have made
^mate in . which free enterprise no serious effort to restore hew

.

To help boost demand next year, the mills are counting on
continued improvement in the over-all economy; a better automotive year than 1958; rebuilding of steel inventories in customer
plants and a pickup in the market for plates, linepipe, oil country
-casing and tubing and structurals, all of which have been lagging.
.

Meanwhile, continues this trade weekly, the market has been
'

production. If

it is that social and economic

,

of capacity^

unoil

there is erne area of agreement between communistic opinion and

-Production* .this year is expected to be 84,000,000 ingot tons,
about- 60%

war

He added that Russia.would prove
the superiority of their system in

ours

history; /
-

declaring

Worse yet,

|£ "0' impossible. It is uPitott,e
(

'

or

was

1949, "The Iron Age,'* national

better year in 1959

in

he

that

metalworking weekly stated on Wednesday of the current week.
a

accom-

govern-;

sure that sanity is reinstated in
omy, which is challenged today as the management of our monetary

accomplished

society anathema to us. A
portion of the world will

a

large

gold and

our

depends in thefinal
ahalysisonpolitics and laborunions.

nature of
duty and
role, like it or not, to be the active
guardians of the free market econ-

our

of

dur government

a great influence on the
our society. It is their

as
_

loss

bond-standard, and the credit of

!'

theme

one

have, deliberately put the world
a dollar standard; while
the

dollar

Business leaders inevitably have

achievements

were

its

we
on

nations.

free

ourselves

they

as

constant

ef money and credit.

-

chosen

can.-

examine each

ment bond market are disquieting
symptoms of a basically unsound
monetary situation due to abuses

the Businessman in Domestic and

Philip Cortney

s

to

The

to their responsibilities.

next Congress

x

the

these

because

and salary payments. The department's new report put
the August rate at $350,100,000,000, or $500,000,000 higher than
the earlier figure. as

possibly

as we

me! now

the demoralization of

Greatly under the influence of
the U. S. Council, of which I have
the honor to be Chairman, the In-

allies. We shouldn't try

in wage

the mills are writing off 1958

Let.

A Dangerously Serious Situation

i

a

material

shock

a
„

:

has

that at any

steel industry

-•

™

condition, but

® conditions
!fpreserva*lon anc* Progress of a free market
economy,

ternational Chamber of Commerce

^lishmento^ an7 toddy^more .^o

the

much

as

either don't recognize or don t live
>

August figure, with most of the increase due to a further advance

In

the fourth

notf the least one, is that we should
liberalize- trade - between nations

S;<^ our society

September rate, which set a new high for the third
straight month, was about $1,400,000,000 higher than the revised

•

1 vn

■.'cycle.. •

universal suffrage, while most of

and

p

*

^

•

by the communists have

The

;

the

,

;haKlr the politicians, elected by
forgetting
tlmt ithey have-to be

■

the

b 1 em

mize

seasonally-adjusted annual rate of $357,500,000,000,
cording to the United States Department of Commerce.

condition, for

second

The third condition

v

cans

Recent

the agency pointed out.

record

a

i

confronting

Personal income continued to climb in September, attaining

v

m

p r o

Despite the after-tax net income drop to an annual rate of
$15,700,000,000 in the second quarter, compared with the $22,100,000,000 annual rate in the third quarter of 1957, the flow of divi¬
dends has held even with last year,

o

c

economy

ment" in corporate profits, the department noted.

.

e r

face

.

.

later a totalitarian

ciety is the free play.' of market
forces.;.
•* ,*•1

not

earnest-';
i' w i t li

Corporate profits in the second quarter of this year rose to
$32,000,000,000 from $31,700,000,000 in the first
quarter, the report continued. This was more than $12,000,000,000
below the annual rate high of $44,200,000,000 in the third quarter
•

or

survival of the;
f'r"ere'i sdciety *

,

■d-'

it

like

we

«

annual rate of $352,400,000,000, up about $2,000,000,000

the third quarter of 1957.

or

society.

successful operation of a free so¬

complacency, our acquired easy
destiny has put on the shoulders living habits, our greediriess for
of our people the responsibility money, our exaggerated pleasure
for leadership of the free world, seeking, and last, but not least,
It is no exagpur labor unions due to bad and
enapted by shortger:at^pn;4C-J
>s|gbted;politiciah$.i
state-that jthe
i
u
j

>

an

,

foremost, the survival

wake sooner
form of

.

quarter, with the prospect that corporate profits will reflect
significant improvement, the United States Department of Com¬
merce reported.
.;
While data for a calculation of third quarter national income

reached

.

free society depends on hav¬

^

j Whether

a

the follow¬

on

•

cars, that auto manufacturers and dealers have something. to gain
by the-shortage, since it will tend, to; lessen price resistance until
that time when new car stocks improve.
.National income recorded

aims

these

of

ing a sound currency.. Jt is no
exaggeration to state that an un¬
sound currency wiir bring in its

•

i

equit¬

free and good
*

attainment

depends primarily
ing conditions:

and

'

vf the free
world depends upon reversing our disgracefulnnwillingness to
reinstate the American dollar on a sound basis, and topursne
other essential conditions necessary for the preservation and
progress of k free market economy. In suppling the details
> behind this strong indictment, Mr. Cortney notes we must;
cease becoming a high- cost and high living country which
threatens - our^international competitiveness, control the ampli¬
tudes of our business cycle which jeopardizes the free - world,
end business and labor monopoly, and most importantly rein¬
state sanity -in the management of our monetary affairs. He
warns there is no protection against inflation for everybody,
points out; government debt monetization is the root of infla¬
tion, and finds loss of gold and demoralization of government
bond market a perilous symptom of an unsound situation.

strikes in the automotive industry has upset the time-table of. the
manufacturers in getting the new models into dealers' hands in

sufficient numbers.

" r"'

•.

Coty, Inc.

Chairman; -UiV S. Council^ International Chamber of Commerce

J
•The delay

V:,

President and Economist,

:

^
■

a

society.

By PHILIP CORTNEY*

'

and

income are *as

able as possible in

Commodity Price Index
Food Price Index

NEW YORK

39 0Iff est Serving Investors

•

CHICAGO

36

6

(1770)

The Commercial and Financial Chronicle

their

Cwrent Bond Market Trends and

bonds.

Bond

Financing Procedures

though

of gas and

Mr. Hager's comprisable topics.

cor¬

The New

was

nies

law

was

refundable issues.
defer

financing,

non-callable and

versus

bonds

not, the

borrow when and

as

money

non¬

Before

to

:

who
of

ness

ing
'

is engaged in the

busi-

underwriting and marketbond issues.

new

The

months

12

past

nessed two reversals
the

bond

market

wit-

have

of

trends

which for

first

The
the
the

by

radical

a

prices. This

surge in
hv

was

up-

announcement
announcement

the
the

on
on

afternoon of Nov. 14, 1957 that the
discount rate, after standing only
three months

at

Zxk%

being

was

reduced to 3%.

was

electrifying.
issues

Slow

suddenly

moving
sold,

were

rapidly.
For
instance,
on
the
morning of Nov. 14,. there was an
unscW

Telegraph

tures

which

licly

Federal
1939

of

Debentures
California

Debentures

Co.

public offering)
Standard

It

tures.

Oi
Oil

and

ot
of

actually

the

had

been

two

first

weeks

ously.

By the close of
that day the entire issue

stantially all sold. Prices

of other
t

its

these,

there

are.

those required by law
commission rule or policy

by

have

elected

this

although under
do

and

sale

This

some

iary

has

been

a

in

these

weeks. Quotations have

usually

sensitivb

to

It

is

since

UvG

bidding

half

un-

kind

that

^Legislative
these

American,•;40

billion

mcJuded
I"ClUded

sues.

,

bodies

that

some

Recreation

135.
113
83

_______

Control_'____

49
..."

-

„.7.

891s,!
$6,761
50

________

well.

refer

to

such

items

as

of
Volume

■••v.*

of Borrowing—15-Year

v:v*

--

Drovisidnsluid

'its

184

Housing

Flood

-■

493

$6,811,

he?d .^.7C,onstit,u"

Some of

>*■

333

Linen

outmoded

were

'

Industrial,
Unclassified

as

provisions

earlier

$2,428
1,035
1,010

«,

and Welfare

^ J'Refunding
S.

alone

Airports

Public

12.

John

-

annual

Aid_

and

11.

toat^^ded ^halmes9 S
ftTcbSS
principal^Jdbnted In 1844-oV^r 100 veai?
debenture is-"

tms
this' total

in
to

Ports

10.

dollars !

amount of bond and

oi;

Veterans'

Health

9.

orie^

and

Utilities

8.

and 50 years ago."

atfCompeti-

five

0ver

of

not

sizable

________

7.

i^manvrasfs

significant

a

1941.

companies have sold

several,

been

any

5.

anfT^t^sV^aUe^^eir s'yTtein-*

somewhat,

past

thereof.

Other

£6.

have neither

exempt from regu'-

now

fact

the summer,months the bond

"jittery" state

4.

These latter

compa-'

involve

but

Education

legislative

j

u.50 but

In view or wnat happened dur
m view of what nappened durmarket

1.

[enactments.,

„;_0

costs,

:.2. Roads .and Bridges
3. Water and Sewer__

posed by Stateconstitutions

requirement to

These include

so.

of

;
;

;

,

strictions and

competi-

method

no

:

appropriations for operating costs
V
4"
Millions

business

limitations im-

bidding there are numerous
public utility companies w h i c h

services

capital

which regulate

tercd holding company or subsid-

mg

These

has
made rieces-

live

Sustained Bond Price Upturn
Held Unlikely

issues which had declined

after marketing bounced back
and
went to premiums. Dealer invenlories of bonds were reduced sub-

addition,

to sell their securities at

price is right. The lifting of
the .weight of these large offerings
bad a salutary effect on the mar--

previ¬
sub-

Ex-

Besides
or

adverse

the

ismess
business

revo-

■

then
prevailing, thus
proving once again that an issue
of quality can always be sold if

pub¬

was
is

in

the sary methods
utility securities "of financing
rule or policy/ that are not
adopted the'practice generally of' subject to the
uuj!—.
J
requiring competitive bidding.
narrow
re-

that

^balance of at. ket immediately thereafter.

seen

lutionary changes in- municipal
financing.
The-growth
of
our
country both in population and in

issuance of public
which have, by

for

these offerings were all marketed

despite

In

states

'

a

analyze and formulate sound judgments.

The past decade has

as

and industrial

agencies.

DebenDeben-

developed

to

aspects,

several

$200,000,000

Indiana

to

the

and

months of 1958 was higher than for"
of 1954 and 1957. Mr. Linen tabulates

i

the accepted practice among

$350,000,000

be underwritten

1944

Commission

Securities

'

I ? ■>"

seven

years

and calls attention

.

its Rule U-50. This method is still

Standard

of

to

ever

the

Bank

New York City.;

.

change Commission in 1941 under

Sears, Roebuck &
largest corporate debt

(the

issue

of

—

and

Power

.

study showing shocking profits by; ;
contractors on lease purchase
financing. He cautions on the need for examining
carefully the pressure for admittedly '
v.-* needed public
schooling and suggests much can be done to
;
educate the laymen in economics, and in improving his ability

or

to othei raiJload securities, ;the

Company Deben¬

offered

recent

Oil

in

securities-

;•

;

,

the major purposes for
municipal borrowing, reviews borrowing
methods pursued other than the sales of
general obligations

-

indebtedness.

and

oker Sl?oad

to

were

000,000

Certificates

Trust

issues

'conditions

new

and

large

very

previous peak

.

.

The Interstate Commerce Com-

the

successfully

The effect of this announcement

estimated

some

total for the first

;

v

scheduled for offering
period immediately ahead.
Among these were issues of $150,-

in

triggered

was

which

in

their

very abruptness and severity were
the most spectacular in my memory.

absorb

:

A

v

».

Federal agencies have
adopted
competitive bidding rules or poli¬
cies as follows:
>'j '

borrowing.

tion, quotations were depressed
during this period by skepticism
as to the ability of the market to

review recent developments in
the market from the viewpoint of

of

-

;.;

President^ The Chase Manhattan

V New York banker presents brief outline of persistently growing ■:'(
municipal capital financing in past 15 years and reveal* the~

.

,

certain exceptions, 4

evidences

Municipal Financing}

By JOHN S. LINEN*

_

...

v;

further broadened to ap-

long term -notes; debentures

other

discussing other phases' thorities might take and, in addi-

to

Vice

electric compa-;^

and

ply also, with

'

of the bond business I should like

...

.

author advises managements to
is needed and to pay the rate

which bond market indicates is proper at time of

of gas

disposed of through competitive bidding and in 1950 the

In answering the question as to whether to

or

v

electric companies not

be

and of callable and refundable

0i

of1

this;

In this same state a statute
adopted in 1919 requiring,that

sustained bond price upturn, and he incisively weighs the
pros and cons of competitive bidding versus direct placement

one

in

ding.

York investment banker doubts the current situation presages

v

pioneered

by share-holders, pursuant
to their preemptive
rights, be dis^
posed of through competitive bid-.,

any

•

somewhat

Commonwealth

taken

porate finance in past 25 years, and when and what rate to
borrow money, are

the

a

development; al-

field as early as 1870 when its..1',
statutes required that capital stock/;

Vice-President^ Halsey, Stuart & Co. Inc., New York City

developments in the field of

been

Massachusetts

By A. B. IIAGER, JR.*

The outlook for bond prices,

has

recent

more

Thursday, October 30, 1958

.

.

The application
of
bidding to corporate" \

competitive
securities

.

A
A

; Review

^

'

quick look at the comparative
'''-

"

1

"'""1

volume totals'h';is even

asas-

more

If we go back for only
15 years' this is stm true- Th<r
growth ^as been rather consist-

founding.

now^d sinr.

ently upward since that ttoe with
that time, with
the total financing during each of
Buyers who for some have
set
off
the
effective
exercise
sharp swings in debentures of
of
the
time had shown little interest iri
the
past
five years, .10
times
prices. However, at the moment- which
state's authority to
performing its
the management elected to
bonds now
greater than was the case in 1943.
nrrrm,,.,
suddenly found funds the market is giving a pretty good
h„„„
sel] at v-uju^i-ui/1'"0 bidding +liriiuTl-»'.
competitive hirlHiiKt though:'
to invest in lars
An
indication of the growth is
i*ge amounts, During account of itself. This may be
due; under no legal compulsion do - do.
the weeks
listed below:immediately following,' in part, to the fact that, other thap so.
'V.
■ v."'.■;
-Millions
each
succec d i n
g
new
issue for the Treasury's financing prob-r
" '
>
V. ity has been needed is well known
? 1943
brought a price appreciably lemft,. the schedule of new offer-.
Approxnhately 90 /<? ot .the pqb$507 V
fp-many of us. The demands that
he utility debt issues
V:..'i1945u£4-_;
819 '
Xmcluding, rest on the
hnco
r\4nntnrol
doorsteps of our states
;___
;
• 1947___?_.
2,354
rumor

and

feature

stories,

news

two billion three hundred

stantially.

...

am
are

million

.

..

w

*

v

.

ul

bS atlttSS

,

,

xt

.

"

1

rfoo

lino

,«*■

,

:

.

.

.

.

•'

-

gov-

utility

bonds

mately

1*4%

dropped
per

approxi¬

in

annum'

2*/j

months time.

There

f

•

followed

three

;

further,

cuts in the discount
rate. The last

of these

was a cut to
1%% which
in the New York district
occurred

offerings. I seriously doubt, how-,
ever, whether the current situa¬
tion presages
any sustained
turn in bond prices.
,

Competitive Bidding

cuts

had
tne

on

much

less

bond

bond prices

P-edu

'

of

effect

an

market.

\vere

lintil the end of

May. At tins' point
the market
developed a tone that
was

decidedly suspicious. Howfever, the severity of what was
to
come caught most
of the so-called
experts
"flat
footed." In early
June the IT
q
m,,.:;
took

some

fin'tnnincr

,/L*

Series of .long-term

u

«-01u s ?ue 1985 and

of 2/s /) bonds
due 1965.
tor a short
period these

issue
Although
an

bonds sold

3 the
P,remium» it

rf

atter

.was

not

long

subscription books had
been closed that
the mjirket
prices
on
these new issues
started to
slide-

progressively

been

two

.

I

Direct

% "

-

and the other is the so-called

downward,
'

di-

private placement method
of selling securities. •—
or

of

to

w

these

developments
ucvciuiJineius

offered

tificates)

corporate debt issues
through the so-called negotiated
sale method. Under this method
coupon

terms of the

at

some

the

through

mate

issue

are

discussions

agreement

tain

not

decline in
of bonds.
a

j"

0f the
some

fo^JFtvnn

a

.

-

what

action

^Ai address by Mr
Annual National

27th

Controllersi
tic

City,

extent

of

that

by

virtue

public ownership of
large industrial cor-r
time
may

their securities in

may

elect

come

to

.+-

.

f

unt,

ln *933, there has dea

pra?tlCe 0n the part of
issuers of

corporate

selling

that Act. These sales
known

u

price!
as

monetary

and

Conference




"private placements?
relatively unknown be-

in" fore that timeUnregistered

to

;Purposes Requiring UapitaL
Borrowing - : ;

It

.

'

issues of

this

is :

confidently

• predicted
by
responsible sources 'that
trend
wilt'continue toward

various

capital 'improvements re- "the
financing in those days higher totals in the years to come.
restricted
principally
to In support of this, the total for
modest school
needs/street im¬ the first seven months of 1958 w#s

quiring
were;

provements
with

and

water

minor additional

supply,

needs.

higher than for the previous peak
of 1954 and 1957.
..i

To¬

years

day, we find these items still lead¬
ing with educational costs far in
front

Various

of

Methods

of

of

the
the

Atlan¬

bidding hanserbee°nS the°^ceo}ed
method bv-which states
cities and other

conntie<;

municipalities sell

and
legislative restrictions referred to,

tions requiring capital financing
which, in the aggregate/swell the

various methods of financing were
resorted to other than the sale of

total

substantially.

general

just

moment to note the classifi-

a

It

will

•

take

nancing,

they

are

listed below.

-

Under the unclassified
group,
which represents about 13% of the

total, are such varied purposes as
dornutory revenue, transit, forest
preserve

and

even

abattoir

and

While the above

titles, refer to
capital improvements which have

Because

of

constitutional

obligations.

Continued

on

page

in-

the

sale of Special Revenue and
Authority obligations, Municipal
Lease and Contract

financing, etc.

Although these procedures have
-

been !a

convenient

means

of

es¬

caping the restrictions they have,
in' many

method
rather
Mr.

doing
an

Beebe,

O'Melveny

•

of

&

by

a
costly
financing

such

economical

the

law

Myers

in

geles, -disclosed
profits

been

cases,

of

than

some

contractors

n&*

26

These-

eluded the pledge of special taxes,

-

one.

firm

of

Los; An-

shocking
on

lease

been financed by bond issues, they purchase financing in his speech

ScolT

*°le. in the Securities Act.. This our Present day livi*g standards.
i® Section 4 (1), under which an
An address by Mr: Linen before the
-

Borrowing

any other-purpose.
But,
there is a multitude of other func-

popularly' mosquito abatement districts.

as

were

v

au-

Hager before

Jnstitute of
America,
N. JL, Oct. 22,
1958.

1SSUe+S

are

1956_;___.
1957__^4-!i

•

pared by the Investment Bankers
Association for. the year 1957. In
the order of volume ■ of such fi¬

of the Secu-

ioqq

rit|es

veIoped

passage

1955

these

cation of purposes of issue as
pre-

Unregistered Issues
the

supplying

sell

.

-

Since

'

1954_____.

.

for

competi¬

open

tion.

-S mf,thod 1S
usfd Pn}F .their securities directly to intypes occasionally for utility debt is- vestors without registration under

concern

the

the

porations, the
they too

oc

occurredffh^1

the

3,694
5,558
*6,969 '
5,977
5,446
6,958

1953_:__„

(

,

„

,

which

wide

of

when

or

sues and even less frequently for
Qnmmpr'vna
pnces during railroad issues, although it is the
S aS sPec?acularly customary method/for marketing

Tua

th^

'prices

V.

7

merely to give f'

of

inconceivable

many

by

.

instances^ natural gas'pipe
companies.
However, it is

line

is-

suer and the investment banker,
bankers, selected to underwrite
and sell the new securities.

belief

:

.

v

by this

"

..

of competitive

ulti-

the

..

bidding ii>
selling debt securities. In tbe cor-;
field competitive bidding
has been applied primarily to the
securities
of
public utility and
railroad companies and
in cer-^

arrived

and

between

also- sold
-

indication

use

have staggered bcthe
public officials

/g<to'remeills l«^t. a generation
cer-;:^ ; '''

porate

rate, price and other
new

were

1950__
;

W0urd

Securities

debt

I cite these facts

customary to market all types

the

raflroad

•

(exclusive of equipment trust

it
11

new

Scn.viCes

responsible

develop-

the widespread use of competitive
bidding for debt securities of pub-'
lie utility and railroad
companies

prior

Period .164V
sold by

method. '

financing practices dur-,
past 25 years upon which
should like to comment. One is

rect

the

through 1957 were
com-; y0hd
petitive bidding. During the same

ments in

w

^S0me flnanfmS which in-

Siv ef

have

;

However; ing the

thereafter main-1

fairly stcady level

a

There

;

during

up¬

.

versus

Placement

April 19, 1958. These successive

on

offered

HjefiS!ciP958CQUnciI' Ashe"

The am0unt of financing that
has been done-in other form than

Continued

on page

27

Volume 188

Number 5790

.

.

.

The Commercial and Financial Chronicle

f

(1771)
r

a

...

^

fit.

U * **

> » M'

i"

_•*-»

«-» I \ ■ f.» *'■»

4

.i

COUNTY OF SAN FRANCISCO
FORN

I A
V-

ISSUESAdWOUNTS/WATES; MATURITIESJU4l) Yiaj^S i>R WtlCfcS
,J

"y,t

,/Uv

"

5'S'I"

•

v

*

."•

>•

!s" **

V-

?

V.i/j ''i

•

;

'

e,.;

hr^

;■

>

'

.'--Centers

' ;v

<Bonds—■1955,'Sefies"C

140^000 Each Year pec. 1

;

•

Doe:

**..'2'
"'

?

at the

$170,000-.Each Year-Dec. 1, 1959-63
175,000 Each Year Dec. 1, 1964-73

V

C

^

'

m

Due

* \

* '•

V '

to both principal and interest."

as
•

.

-

'

•

'

;

-'

Exemption

-

all present 'Federal and Sthte

JSonds—1956,' Series jC

\

■

.

'

' (

-

of counsel, interest payable by the City and County

its bonds is exehupt from

upon

of California personal income taxes under existing statutes, regula-

-*

tionsiand court decisions.

1,030/000'Eacti Year Dec. 1, V964-73

"'

W« believe these bonds
Yield

Coupon
.'.Rate

\ik * *

,r

,

Dee:1 $1,025,000 Each Year Det. 1, 1959-63

•.

Due :$45,Q00;Edch Year Dec. 1, 1959-73

Amount

<

*

-

,

Tax

Ifi the opinion

$15,425,000 Hall of Justice

,

I

'

v»

jr.'

T

..r._

7.,

•vfj

^

"245,000 Each Year Dec. 1/ 1969-73

//

"5

-

^he^City end-County of'San 'Francisco in Sari Francisco, California,

of $l,t)00 registerable

'

-

"$250,000 EacK' Year Dec. 1, 1959-68

-

.

/ -•'

r

-

-

Agency of the City and County in New York; N.'Y. Coupon bonds in denomination
,

:

$675,000 San Francisco Hospital

Bomls^l954( Series

office,of the Treasurer qf

or.at the Fiscal

Boads—1956, Series B Y.\. f

-Doe:

Pmyment pnd Heghtratipn

Principal and semi-annual interest (June I and December I) payable, at the-option of the holder, '-

1959-73

$3,725,000 School
$2^00,000 Sewer

fuel.:

©ire December 1, 1939-73,

J

$600,000 #J«y9Mundt <HKI ^etrMtion /
vr,-i

v

ifi.»,/lendl«,i

t

Mated Aecember 1, 195*

90,000 .Each'Year Pec. >1, 1949-73

•'

•

v. •/

a;

»•

BenJi^947,' Series 'K\*\ J,

-

^Diie: $95/000::€eKHj.¥eariPec;r s1,T959-68

,

b%, 2*k%, 2%% and 3% Various Purpose

>

■

$1*400,000 Street Improvement

?;
:

:»

."'r{Accrued? interest''loobe i&Med)

••

7.';

;

;

Yield

Coupon

or

-'Price

Rate

Amount

Due

or

"Price

for savings

California

in

•

are

Legality for Investment

'

,

ir

-legal investments in New-York for savings banks.and trust funds and

b.anks, subject to the legal limitations

upon

-

the amount, of the bank's

,

$1,625,000.

6,%

41,625,000

-

;

1.959

6

1960

■

1,625,000, >2 y2

.

V

2.40%

1962

3

1968

3

1969x

100

1963

3%'

1,635,000
1,625,000

2.20%

£25,000

21/2

which may

1,635,000

'2%

1964

security for deposits -of public

100

...

-a

;2?/4

1965

2%

1966/

2.90%

3.0£%

1971

3

2.60%

1,635,000

197d

-;3

2.70%

1,635,000

1,625,000
1,625,000

3.10%

1,625,000

1972

1,625,000

be invested in bonds whichrote legal' investments for savings binks, and'are eligible as

100

2.60%

V

:

2.95%
,

1973

the laws of the State of California

in California.
^

Purpose ana Security

These bonds, issued under provisions

3.15%

.

v /

\

moneys

r

^

.

"

■

v

\

legal investments in California for trust funds and for other funds "

investment, and/are likewise
1967

$1,635,000

.2.00%
;

1961

6

1,625,000

■•v

'
'

r

■,*

t

'

*'• t

,

of the Charter of the City and County of San Francisco and

for various purposes, in

the opinion of counsel Constitute valid

legally binding obligations of the City and County of Sap Francisco and said City and ,County

has

3.15%

I.

,

'

and

power

and -is obligated to levy ad valorem taxes for the payment of^^ said bonds and the

interest thereon
tion

all property within said City and County of San Francisco, subject to,taxa¬

upon

by said City and County (except cer-tain intangible personal property, which is taxable at
,

limited rates), without limitation of rate

.

amount.

or

-

-

Legal Opinion
The above bonds.ace .offered .,when,--as and if

listed ibelow.
nished

on

well

as-

ars

'

issued,and;'receiyed--by the underwriters

other underwriter's' not shown '-.whose names'wilf be fur-

-

par

;

Incorporated

...■

v

^

■

-r

J.Bartti&Co.

*-

-

Clark, ftadge & Co.

i

•->

-

*

,

F. S. Moseiey&Co.

The Boatmen's National Rank ';

WMhrni R. Staats & Co.

of Oregon

New York

'•

Sanfmncueo

.-Paine, Webber, Jackson& Curtis

.

;

The Hliaois Company

are

required

.

./•

;

<! •

„

RW.fressprich&ICo.

•

Shearson, Hammill & Co.

Shields A Company

F. S. Smithers & Co.

Reynolds & Co.
Roosevelt & Cross

New York HanseaticCacporation

Ladenbarg, ThalnuHin & Ca.

White, Weld & Co.

Dean Witter A Co.

Stone & Youngherf

Incorporated

Trust Company otfieoitfaAndwwsAWelis, tec.

Fitzpatrick, SnlKvan & Co.

.

j

of St. Louie

Spencer Trask & Co.

discount. Investors

,

.

...

Estahrook li Co.

a

premium paid thereon.

any

Security-First National Bank Ptielps, Fenn&£o. iMerriil I ynRh,Pierce, Jenaer&Smith

ei'iiveS.I
& Co.
The First Natnnai Bank • Seattle-First Natienal Bank

C.

Weeden & Co.

bonds purchased at

regulations to amortize

Bankers Trust Company: Guaranty TFust Cotn^any ffljfth&Co.,lnc. The First BostonCnrpura'ian

tehman Brothers Harriman Ripley & Ce. Smith, Bamey &£fl. TheRertheai TraUfeapMy American frustCompany
R. H. Moulton & Company

Amortization of Premium

may accrue on

under existing

of Alew Vmk

-

•

,

taxable gain

a

v,..

Bankof America HarrisTrust and8avmgs Bank The Chase ManhattanBak Tlie FkstMatioiutCHy Bank
H.T.4 5.A.

value, and

Tax Gain,

initially issued by the .above named political subdivision at not less than their,

These bonds wilLbe

";

request, and subject to approval of fegaflity by Messrs. Orrick,

Dahl.quist,^dderriagton; & Sutcliffe, Attorneys,.San. Francisco, California.,

.

.

■

f

CHyflarthnaal Bank fc Trust Company

Wikamttairk Company

<

,

Reaii, Tayler&C0.A. AI.Ridder ito-.tnc.

■

-

j

Model, MmAl Stone

First Southwest Company

Fldredge&Co.

•'-•*-

of Chicago

Incorporated '

Wm.E. Pollocks Co., Inc.

PtooiMSflvmp Sink STrirst Company

Incorporated

.

Scheelikopf, HuttonS Pomeroy, Inc. >•

The first Rattanl Rank and Trwttompany

Eumtz HuteMnson & Co.

; J. A. Hogle & Co.

-

;Oklahoma' City, Okla.

1 NmrthwesternNattonalBank
of Minneapolis

Stem, LanertiGd.
:

■

The First Cleveland Corporation

WanMsi)me,HMl&Do.

.

Nathmal Banket Comme.xe
of Seattle

fljttmerSCempmy.lnc.

Anderson SStrudwick

J.R.WlshmStone

i1*"'

GintherS Company

Raiman & Company,tic,

*

_

A.0.Edwards SSens

t

G. C. HaasS Co.

Granhery, MaracheS Co.

Industrial Natienal Bank

Lawson, Levy, Williams S Stem

Irving Lundborg S Co.

of Providence

RemhoidtS Gardner

Rockland-Atias National Bank

SeasongeedSMayer

RodmanSiltaBhaw

,

Shumai, Agnew S Co.

of Boston

Brush, Slocumb S Co. Inc.

The Continental Ink ani Trust Company
Salt lake^City,_ Utah

Kenewer,MacArthurSCe.
0dober 28, 1958




Townsend, Dalmey and Tyson

J. C. Wheat SCo.

,

SchaBer,NecherSCe.

:

StemBrottersSCO.

A -circular

,

Fedaalwi Bank nd Trust to.

Green, Ellis S Andersen

HaUewell, Sulzberger, Jenks, Ktrklsnd S Co.

i

-

WaiterStdws^&Company ■

relating to these bonds

may

be obtained from

any

Thornton,Mohrandfarish
of the above underwriters.

A.0.WhileSCompany

H.E.WorkSCo.

■

8

The Commercial and Financial Chronicle

(1772)

Air

.

.

Reduction

Company—Report—Thomson & McKinnon, 11
Street, New York 5, N. Y.

Wall

COMING

American Hoist &

Dealer-Broker Investment

Thursday, October 30, 1958

.

Derrick Co.—Memorandum—Piper, Jaffray
Hopwood, 115 South Seventh Street, Minneapolis 2, Minn.

&

Also available

memoranda

are

EVENTS

►

Control Data Corp. and Red

on

Recommendations & Literature
it
•

understood that the firms mentioned will he pleased
to aend interested parties the following literature:

ii
-

■

American Investors Corporation

ence,

Corp.

,

American

'

'

;

N. W., Washington 7, D. C.

of

7
•

Company—Analysis—Baker, Weeks &
Co., 1 Wall Street, New York 5, N. Y.
:
,7 ,£y y. :

"
-

^ - Cricket Club..
Nov, 10, 195&- (New Yoek City*

Analysis •—Laird, Bissell & Meedsi, -320
Broadway, New York 5, N. Y. Also available is an analysis
of Summit Mining Corporation. ^
h j. v
.v y ^
*

:

—

Arkansas Louisiana

Gas

u'j" .>■ yv'v

Seeurity Traders Association op
New York* Annual Beefsteak'
- Party at the Antlers Restaurant;

v'

j
v

Analysis—Oppenheimer & Co., 25
Broad Street, New York 4, N. Y. Also available is a memo—

Nov.

^

randum

James R. Clarke, of: Dominion Securities' Corporation—Lohman Publishing Company, Burlington, Vt.~
y [

Avco
-

Price

vy

Chemical■>& Pharmaceutical
&

Industry—Review—Smith, Barney
Co., 20 Broad Street, New York' 5, N. Y.v"'." V"; ' 4 • ■*, - *
*V

Comparative Yields of U. S. Treasury Issues

Tabulation

—

markets

on

'

•

metals

N. Y.

&

"

■

Bulletin—-

Hanly,.100 North Franklin Street, Hempstead,

•
.

V;

New York.

;

...

-/V 7//;

.

.

—

.

;;

!«

comparison
York 5,

—

on

V

.

—

•

•=

^ -v

; -

-

Analysis

—

Parrish & Co., 40-Wall

become
Fallon

-

_

Railway-Northern Pacific Railway and their

.

affiliated

with James

L.

-

Co., 7805 Sunset Boulevard.:

With Marvin C. Yerke

-

.

7

i

COLUMBUS,. Ohio
is

now'

,

'

A.

with'Marvin

C.;

Inc.,; 40
'

:

•

Now With Wakton- & Co.
t

;

■;

Lee

—

Yerke 7 and
Associates,
West Broad Street,
r,:::

\

subsidiaries—Study—E. F. Hutton & Company, 61 Broadway,
York 6, N. Y. ' Also available is a memorandum on

New

>

(Special to The Pinakciai, Chronicle)

Kuhn

Corporation— Analysis — Pacific Northwest .;V
Company, Terminal Box 3686, Seattle 24, Wash.

Corporation; 15 Broad Street, New
analysis of General Re¬

r

r

Street, New" York 5, N. Y.c

Gteat Northern

;

ANGELES, Calif .—Thomas V..
Moon and Irving White have

N.

f

^

Tna PlMA^CIAt.-CliaONJCtE)

LOS

;

memorandum Jon Investors Diversified Services. *'*•"*"
—

; Two With FaUon;

'J /StKJCUatO

Herbert E. Stern & Co.. 52

—

York 5, N. Y. -

Dairies*. Inc.

elation Ahmal Convention «9 ^
the- Boea Raton Chib^ -r

-

General America

York 5, N. Y. Also available is an
insurance Corporation.
'

Nnvt 2-5i 1959: '(Bowk-Bnton^-Fln^^

:

Data

Island—Analysis—Blair & Co.
Incorporated, 20 Broad Street, New York 5, N. Y.
^

v.

.Hotel.

>.

•

Franklin National Bank of Long

N. Y.

1958-rThe First Boston

.

3rd quarter earnings

Stocks—Comparative, figures at Sept. 30,

a

Foremost

Quarterly

Laird, Bissell & Meeds, 120 Broadway, New

New York City Bank

is

-ica annual

}'

Co.—Memorandun>—Paine, Webber, Jackson & Curtis, Pillsbury Building,. Minneapolis 2, Minn. Also -available

'

comparison —New York Hanseatic Corporation, 120 Broad¬
way, New York.5, N.-Y.
• *,
.
$•
New York City Bank Stocks—Bulletin

^
;

•

>.

Donaldson

Company of New York, Inc., Ill Broadway, New York 7,
Leading Banks and Trust Companies of the U. S.

Co.;-29 Broad-

Bankers Associathwii-of-'Anjer-,-7
meeting atthe Hilton - -

,

v

New York 6j N. Y.v

WM1 Street, New

Japanese Stocks —Current information—Yamaichi Securities

r

April 1-3; 1959 (San Antonio,Tex.)7 >
?Texas G r ou p o f: investments

Utility Company—Analysis—Mabon & Company, 115

Dictaphone: Corporation

:

Vdorf Astoria.

j

,

.

(New York City)f
Association of New7>.

I

Broadway, New York 6, N. Y.

way,

.

Edwards

m..;

-

(Mlani

York annual dinner at the Wal-■ 7:

\

V

;■

Eastern

Clevite Corporation—Analysis—Schweickart &

—

—

3,

Citizens

Commodity Exchange, Inc., Secretary, 81 Broad
Street, New York 4, N. Y.—50c per copy, r-Investment Outlook and recommended securities

f Investment

:jones,'Ihc., 1411 Foiirth Avenue Building, Seattle11,* Wash;:?

cago

Stocks—Analysis—Shearson, Hammill & Co., 14
Wall Street, New York 5, N. Y.
0 ' ;~Vv.:D
Booklet

y.>.", "V'; V

1y.f

Dec. 10, 1958

\

Aviation* Inc.—Analysis—Cruttenden, Podesta & Co., 209 South La Salle'Street; Chicago 4,

Electric Utility

—

Bache & Co.;- 36 Wall Street,

1958

Investment Bankers'Association^
of America annual convention 7
at the Americana HoteL

r

7.

—

^Chicago,jMilwaukee, St. Paul :& Pacific — Analysis — H. M.
Byllesby and Company, Inc.;* 135 South La Salle Street, Chi-

—

Futures Trading in Non Ferrous Metals

Report

New'York-5, N. Y.

•:

Analysis — W. E.tHutton & Co.; 14 Wall
Street; New-York 5, N. Y.: '
,;-v: - orvrf - " :

;

4

£ Cascade Natural; Gas ^Corporation—^Report—Blahchett, .Hinton

—

Aubrey G. Lanston & Co., Inc., 20 Broad Street, New York 5,
Consumer Credit

.-1-

analysis .pf, Wheeling Steel.

California

.

N. Y.
••

/.

Common—Analysis—du Pont, Homsey & Company, 3i
eet, Boston 9, Mass. In the same circular there is also

AVcO Manufacturing—

—

yy1

Milk Str

,an,

earnings ratios for major industry
McLeod, Young, Weir & Company, Ltd., 50 King
Street, West, Toronto, Canada/';?*:,;.V'^.-^;/;v:
{
groups

'

—

Revlon, Inc.

on

38-Dec. >5,

Beach. Fla.)

v-

■

Canadian Securities—An analysis—reprints of two lectures by

Stocks

sixth annual
Philadelphia

Philadelphia

dinner dance at the

.

View—Monthly investment letter — Burnham and
Company, 15 Broad Street, New York 5, N. Y. Also avail-,

Canadian

'

•

il

Gas

Anaconda Company

Burnham

able is current Foreign Letter,

Natural

;

Nov. 8, 1958 (Philadelphia, Pa.)
Investment Traders Association

.

Confer-

the nuclear navy, Philips Lamps and Ceneo Instruments
—
Atomic Development Securities Co., Inc., 1033

Thirtieth Street,

tion at the Hotel'Sherman.

J-

Foundry—Analysis—H. Hentz & Co., 72
Wall Street, New York 5, N. Y. Also available is a bulletin
on Morgan Engineering Company. '
:
f

t

7-8,1958 (Chicago, 111.)

National Association of Investment Clubs 8th annual conyen-

American Machine and

New York 5, N. Y.

Atomic tetter No. 52—With reports on Geneva Atomic
,

Stone &
Also available is a
v
VA

Co., 25 Broad Street, New York 4, N. Y.
report on Stone Container Corporation.

•

-

Nov.

:*?

American Machine & Foundry Co.—Analysis—Hay den,

C. Helm, Vice-President, 20 Broad Street,

Trust Company, R.

Bulletin —De Witt Conklin

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

-

American Capital and Canadian Management—Study—Empire

«

—

Field

Investment

In

Owl Stores.

~

(Special to'Tub Financial CnaoNictE)

.

yield and market

over

National

Grolier
.

t

4,N. Y.

James Lees &
.

Markets-Review—Park, Ryan, Inc., 70 Pine Street,

Values In Industries—Review of economic and
market condi¬
tions through the third quarter of
1958—Distributors Group,

Acoustica Associates, Inc.

Trucks

New York

Magnavox

•

—

„

Carl L.

—

become

ated with Waistoii &

associ¬

Co., Inc., 210
-

(Special to The Financial Chronicle)

r

Sons—Analysis-r-Auchineloss, Parker Jc Redpath,

Inc.—Analysis—Reynolds & Co., 120 Broadway,
5, N. Y. -

Company—Analysis—Zuckerman, Smith & Co., 61

McKesson & Robbins,

Joins Reynolds Staff

Haupt & Co., Ill

Broadway, New York 6, N. Y.

— Data
Troster, Singer & Co., 74
Trinity Place, New York. 6, N. Y. Also available are data on
Microwave Associates, Inc. and Oil Basin
Fipeline Co.

has

East Wisconsin Avenue..

r_

Ira

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

Mack

Incorporated, 63 Wall Street, New York 5, N. Y.
•

—

Longren Aircraft Co.—Memorandum—Leason & Co., 39 South
La Salle Street, Chicago 3, 111.

New York 5, N. Y.

•

Review

—

Broadway, New Y6rk 6, N. Y.

Paper Production—Review—David L. Babson and
-Company,
.Inc., 89 Broad Street, Boston 10, Mass, ~

Jr.,

Co.—Memorandum—Woodcock, Hess, Moyer & Co.,

Hussmann Refrigerator Co.

,

Tax Exempt

Pfeifer,

123 South Broad Street, Philadelphia 9, Pa.

l9-year period —
York

a

Society, Jnci—Report—The Milwaukee Company, 207
.East Michigan Street, Milwaukee 2, Wis.
:
"

II. Ueintz

4& Front Street, New

performance
Quotation Bureau, Inc.,

MILWAUKEE, Wis.

Sterling Drug Inc.

Over-the-Counter Index—Folder showing an up-to-date com¬
parison between the listed industrial stocks used in the DowJones Averages and the 35 over-the-counter industrial stocks
used in the National Quotation Bureau.
Average^ both as to

WINSTON SALEM, N7 C. — M.
Edward
Bizzell, Jr., has joined
the staff of Reynolds &

nolds Building.
:

Co., Rey¬

;

-

Clinton Cessna" Opens
MODESTO, Calif.

Cessna is

business

Inc.—-Memorandum—Green, Ellis & An¬

'

—

engaging in
from

Clinton
securities

a

offices

Chabot.

104

at
-

„

*

derson, 61 Broadway, New York 6, N. Y.
Meredith Publishing Company

Securities

—

Bulletin

Stone & Webster

—

Corporation, 90 Broad Street, New York 4, N. Y.

Edwards Paper Company—Analysis—Loewi &
Co.,
Incorporated, 225 East Mason Street, Milwaukee 2, Wis. Also
in the same circular is an analysis of Ceco Steel Products

Nekoosa

For

Now available

Briefs

on

financial institutions

—

.

.

Corporation.

.

ACOUSTICA ASSOCIATES, INC.

-

-

-

,

■

,

*

Nippon Gas Chemical Industries—Analysis in current issue of
"Monthly Stock Digest" — Nomura Securities Co., Ltd., 61
Broadway, New York 6, N. Y. Also in the same Digest is an
analysis of the current Japanese economic situation.

Prominent in the field of ultrasonics—"si¬

Purolator Products Inc.—Memorandum—A. C. Allyn &
Wall Street, New York 5, N. Y.

lent sound" which has

Purolator Products Inc.

finally

come

of

age.

—

Memorandum

—

Advertising, is.

one

of

Co., 44

Hemphill, Noyes &

the most useful tools in

Co., 15 Broad Street, New York 5, N. Y.

MICROWAVE ASSOCIATES, INC.
Fast-growing producer in the field
wave

energy;

of micro-

widely used for navigation,

fire control and

long

range

detection.

Reeves

Soundcraft—Analysis—John R. Boland & Co., Inc., 30

Broad Street, New

York 4; N. Y.

Reiter Foster Oil Corporation

Analysis — Arthur B. Hogan,
Inc., 6705 Sunset Boulevard, Hollywood 28, Calif.

Studebaker Packard

vs

Members New York

Security Dealers Association

74

Trinity Place, New York 6, N. Y.




So

it's

four

smart

to

place

advertisement in

Texas Illinois Natural Gas Pipeline Co.—Memorandum—Doyle,
O'Connor & Co., 135 South La Salle Street, Chicago 3, 111.

United American Life Insurance Company

Company,
the

Independence

same

bulletin

ar

—

Data

Building,

Colorado

edata

Pyramid

on

— Copley &
Springs, Colo.

Life

Insurance

Company, All States Life and International Fidelity Insur¬
Company.

ance

Teletype NY 1-376-377-378

customers

Co., 10 Post Office Square, Boston 9, Mass.

In

HAnover 2-2400

new

Botany Mills—Comparison—Lerner &

Sylvania Electric Products, Inc.—Analysis—Sutro Bros. & Co.,
120 Broadway, New York 5, N. Y.

Troster, Singer & Co.

securing

—

United States Steel—Study—Jas. H. Oliphant &
*way,

New York 6, N. Y.

Co., 61 Broad-

mma+mm

THE COMMERCIAL AND
FINANCIAL
25

Park

CHRONICLE

Place, New York 7

-

Number 5790

188

Volume

The Commercial and Financial Chronicle

.

(1773)

9

struction

Financing iheReplacement Fleet
j.

costs
continue to rise vessels during the first five years itself due to
changes in adminis¬
the amount after delivery to the extent of trative' 'or ' legislative policy.;1 For
required
may
be
larger.
The; 75% or depreciated cost for the example, as the charter market h4s
figures
recently
published A by purpose of financing new con¬ deteriorated and there is less as¬

because of inflation,

Grace Line in its circular offering
S. Government Insured Mer¬

U.

chant Marine Bonds to the

By ROBERT C. PORTER*

show

Partner, F. Eberstadt & Co. ,:v.

'*:'

:::.

«.

-A-

£ - "1 .t

New York City

,N

w

;

j.

the

of

the

subsidized

U.

S.

Oper¬

Flag
set

ators

shipping industry to obtain its
financing
for
the
replacement

the
reports
are approximately $400 thousand.
This leaves a balance of approxi¬
mately $1.8 billion to be covered
by cash derived from depreciation
and" earnings
of approximately
$87 /million
per
annum
after

fleet

;

.

from

nor

i

m

a

1

tment

nve s

rather

sources

than from the
Government
Title V

under

at the historic

interest

3xk %

rate. This is

a

in

change

Government

policy
which
em phaisizes
the
for
Robert C. Porter
-

necessity

of

type

a

financial

planning that
has not been required in the past.
The manifold increase in replace¬
ment costs and the inadequacy of
t;

v

these

meet

time

famous

banker

to

when

be

Maritime
most

a

single

operated at

new

a

'these

cover

been

up

to

requirements; to

extent shown in published

dividends

over

the past few years

on

doubled

the

net

policy

construction

excess

through
next

10

to

15

financing
years.

re¬

a period of approxi¬
mately 12 months after delivery.
Thus, the financial planner must
decide at an early date whether
his company should obtain a Gov¬

in

subsidized operators

outside

made

made within

sub¬

something

be

quires that the insured loans be

of $1 billion will have to be

raised by the

the

that

must

vessel

delivery and the Govern¬

over

ernment Insured

Loan

on

the

re¬

quirements that single ship
ators are required to put

reserves

and

lose

this

avenue

of

financing for the future. While
legislation was introduced at the
last session of Congress to obviate
the

necessity for this early deci¬

sion

by permitting

If con¬ obtain

an

a

company

to

insured mortgage on its

This announcement is neither

an

to

conditions

funds

in A common .stocks.

the cost of

ships

to

the first

in

short

when

you

the first

of

in

from

institutional

1955-J956

ments

from

due

or

in

for

what

the

or reserves

and

pay¬

1960

state

of

are

the

their earnings
will be in 1960,
-1

market

money

lenders

contract

1959

has been committed to date.

or

money

also

and

have

the

rate

is his

money

avoids

of

emphasizes this point. As recently

the

changes
but

company
not
only
possibility of adverse
in the money! market;

the

funds,

adverse

regulations of

changes

in

the

a

as

last month

finally sold

a

one

major

Continued

the Maritime Act

at

on

,

$50,000,000

to

sources

time during the replace¬

some

On the assumption
companies will have

ment program.

that very few

sufficient

npxt
that
cost

be

the

of

cost

the

the

to

entire

question- is one of timing,
is, should at least part of the
of each replacement vessel

financed from

the

as

cover

program,

reserves

outside

program

should the

4V»% Debentures Series A due 1979

Interest

sources

progresses

Due November 1,1979

Dated November 1, 1958

payable May 1 and November 1 in Chicago or New York City

\

or

and the assets

reserves

be first exhausted and the outside

financing problem left to
When, the

date.

time

a

later

arrives

for

Price 99V2% and Accrued Interest

the outside financing,

the question
of how this financing should be
done must be decided. At the

! f

present time the major avenue for
financing

such

United

of

1936,.

States

Copies of th e Prospectus may be obtained in any State from only such of
the undersigned as may legally offer these Debentures in
com
pliance with the securities laws of such Sla te.

Merchant

Mortgages under

or

XI of the Merchant

Title
Act

is

Insured

Government
Marine Loans

Marine

This

amended.

as

in turn involves weighing

avenue

the advantages of an underwritten

public offering against the private
placement- of similar securities
with institutional investors. Other

possibilities
shorter
even

bank

are
terms of

loans

MORGAN STANLEY & CO.

GLORE, FORGAN&CO.

WILLIAM BLAIR & COMPANY

for

5 to 10 years or

THE FIRST BOSTON CORPORATION

BLYTH & CO., INC.

equity financing if the com¬

pany's reserves are not sufficient
at
a
later date
to supply the

risk capital behind the
mortgage loan.

EASTMAN DILLON, UNION SECURITIES & CO.

GOLDMAN, SACHS & CO.

necessary

I

Total

:

The

Forward

Maritime

estimate

of

the

sidized

lines

for

MERRILL LYNCH, PIERCE, FENNER & SMITH

LEHMAN BROTHERS

of the

the

during the

KIDDER, PEABODY & CO.

Incorporated

Administration's
total cost

fleet

replacement

HARRIMAN RIPLEY & CO.

Requirements

sub¬

next

15

is $4 billion for approxi¬
mately 259 vessels. It is estimated
that after construction subsidy the

SALOMON BROS. & HUTZLER

SMITH, BARNEY & CO.

years

i total

cost

to

be

STONE &

WEBSTER SECURITIES CORPORATION

paid
by the
will be $2.2

DEAN WITTER & CO.

■subsidized operators

^billion.

The

total

reserves

of

October
•An

Merchant
cisco,

Mr. Porter before, the
Club of the United States and

address by

Propeller

Marine

Conference,

Calif., Oct. 15, 1958.

San




Fran-,

23,1958.

.

company

large issue of Aaa

for

going

company

obtainable

bearing on timing.
However, the forecasting of longBy financing at least part of term money rates or money sup¬
each construction contract rather
ply is not an exact science. The
than first exhausting its reserve recent
history of the bond market
Not Exhausting Reserve Funds ;

tfye financial planner is how much
have to raise from outside

,'

Variations in the availability of

their

questions

Such
some

financing in unfavorable circum-t
stances. in order to complete its
replacement program. One should
in a much sounder financial posi¬ also keep in mind that there is a
tion than those that are not yet ceiling of $1 billion on Title XI
Insurance
of which $235,000,000
sure where the money is coming
ments

replacement programs.
One

in

can.

a solicitation of an offer to buy any of these Debentures.
offer is made only by the Prospectus.
'
:

group

built under

be

*

investments :..may> provide

offer to sell nor

The

problem for most
companies although some fortu¬
nate
companiesr feel that their
present reserves are sufficient to
cover

oper¬
up

order to obtain Title XI Insurance.

accentuated the

of

al¬
re¬

question said—the best Recent, legislation, per m i t s the
investment of 50%.~o£ the reserve

asked the

-

placement vessel rather than pay
for
the
ship wholly from his

has

costs

worth

.

ment's insurance commitment

vessels, and from
outside financing. It seems clear
taking
into
consideration
the
sidy

new

before

—from sales of

Government's

a

to

reserves

increased

tanker

profit, the

Administration has

.

depreciation

present

question

best

can

.

which have

Merchant Marine Act require the

-

basic

that

surance

hedge against further inflation in
The fir ship construction:, costs.; Also by
necessity of raising outside, nancing of the
replacement pro¬ /conserving, a. substantial part of
capital as the program progresses gram- for the American Merchant its/reserve funds the company is
which is the plan that Grace; has Marine is
similar;, in this respect always in. a posititon; toput its
put into operation.
' /
«
to that of the airline industry for 25% .share of the cost pf the; ship
its replacement fleet of jet air¬ as required to obtain Title XI
'A "'
' Timing' ;; liners. * Those, 'companies
that Insurance. Since this 25% cannot
Under Title XI as now written
covered their four year forward be borrowed, a company that has
the application
for Government contracts for • this new
its .reserves might be
type of depleted
Insurance
of the Mortgage Loan
equipment by obtaining commit¬ required to seek common stock
,

outlines the advantages of public
private placements and the role of the investment banker.

Merchant Marine bonds; and

provisions

A

the
the

the

for the replacement fleet; reviews the successful accept¬

present

annual cash throw-off in

dividends. These figures indicates

of Grace Line's "first venture into Government Insured

The

is

when

of

finance; is when market
are
favorable, earnings
the five years 1953 through 1957;
and prospects are good, and well
of approximately $4 million after,
before necessity forces the issue—

readily compete with other government obligations. He" antici¬
pates over $1 billion needed by-operators in the next 10 to 15

and

remains

time

average

permits government insurance of bonds purchased by private
sources, the investment banker opines such bonds
should

ance

there

approximately $24 million and

Porter. Now that :the changed Federal policy

years

yet passed.

legislation * is
desirable since it would give the
financial planner more flexibility,

finance.

an

as

the

Although

tion subsidy and National Defense
features) for its replacement pro¬
gram against existing reserves of

,

_

opportunities in the shipping industry
the need for investment banking financial planning are.

discussed by Mr.

estimate of

(before the deduction of construc¬

v./; _•

The latest investment

and

an

public
$370 million

struction* it has not

WHITE, WELD & CO.

page

34

10

The Commercial and Financial Chronicle

(1774)

take

Ave We Now in the Foothills

place

stagger

imagina¬

the

tion and will stretch

can's fantastic capacity to produce
Total population in the United-

By

States will go up 27,000,000 during
the decade of the '60s.
This in¬

After

of 15% in the nation's pop¬
will make of the United

crease

LEO CHERNE*

Angelo

ulation

Director, Research Institute of America, Inc.

Executive

York

New

On the occasion of the New York

City

States

'

200,000,000
there

Commodity Exchange's Silver

-

■

Mr. Cherne ascribes

to

business economist and consultant locates

our economy as

this.

not

just

the

generation that

a

world

modities the

and

which the hope for a broader
Commodity Exchange was founded peaceful future.
and this year in which it cele¬

almost 40%.

world

a

of

i

change from
the
pervasive
pessimism of
1933, the lim¬
ited hope for

business

recovery

"

~

spreading

continues

to

economy, a
world
with

improved business are of
the kind that portend substantia}
improvement still to come in the

stagnating

months ahead.

trade, and the
growth of a

ance

thousand
i

the

f 1 o

goods

w

Leo M. Cherne

.of

international bound¬

across

aries.

Now, 25 years later, the
American
capitalist economy is
the world's strongest, the choices
it offers are the world's greatest,
and the vigor of its participation
in the world economy is the cor¬
nerstone upon which so much of
Ihe freedom of the world depends.
It

is,appropriate indeed to look

at these 25 years and those which
lie before us on an occasion which
honors
the

the

Silver Anniversary

Commodity Exchange.

of
It is in

the

commodities that
and

we

the most

see

essential

expression
dynamic capitalism.
In
this
exchange of the most vital comof

*From

talk

by Mr. Cherne before
Commodity Exchange 25th
Anniversary, New York City, Oct. a, 1959
a

the New York

of

growing

services.

His

mar-;

The

;'

by 1970. * Consumer.
income which is 'now

winter months when

push. New orders
handling equipment,

for industrial

the
of

rise,

our economy

that

need

an

increased

supplies are also on
invariable harbinger

spending for heavier
the coming

industrial goods within
months.
The Research

Institute's

of company spending
plans for early 1959 further indi¬
cates
strong upsurge in capital
expenditure next year.
own

survey

Impressive
of

business

as

are

the evidences

they pale
before the certainty that confronts
the American economy during the
next
10
years.
The
American
economy is now in the foothills
of

the

recovery,

Fabulous

'60s.

The

sheer

dimensions of the growth that

in

the

substantial

American

will

than

ter

the

typical family

be

Vatican

ordinary

1970 what it is this year.
These are only the bare bound- 1
aries of the Fabulous '60s.

came

Anthony

H.

the syndicate

Lund,
a

on

will

The

Kuver to

partnership.
a

proceedings. It will also include

.

In

of the Convention.

ATLANTA,
Watt has

Ga.

&

manner,

bearing.

:

,

4*

"It is with great
election

H.

{Special to The Financial

reservation

preferred position in this outstanding issue
of the CHRONICLE.
Closing date for copy is
a

are

,

'

:

following message'
•••'

,

.

'

;

;

pleasure that I have learned of
Pontiff

of

-

the

your

now

connected

v.,.- >

as

/

well.'

with other Americans in extending my:

elevation to this high office.

on your

of your endeavors are,

success

■;

/

,

My

I

am

..

'

LOOKING FOR THE UNUSUAL
'

•

'

/

;

Beautifully Bound Set of

/ Commercial & Financial Chronicles, 1926-1945

ith Goodbody
„

; ■

■

ATLANTA; Ga.—Walter G. Mil¬
ler, Jr. is now with Goodbody

Co., 59 Marietta Street, Northwest.

-

(Snecial to The Financial Chronicle)

-

now

with

Westheimer

&

South

was

formerly with Irving Weis & ;

Company.

Salle

Street.

-

Available in New York City—Write

or

Phone REctor-2-6570

'

Edwin L. Beck

rr

,

Co./

134

La

•

~

CHICAGO, ill.—Harry J. Diacou..
is

r

.

With Westheimer Co. ; \

Chronicle

*

Catholic!

Roman

Messages of. goodwill have been received from all the
of-foreign governments and people of prominence

t

"j'

with/ First
.

!

heads

Oliver/

(Special to The Financial Chronicle)

Place, New York 7, N. Y.

cabled the

follows:

;; <;*

<,

Chronicle) /

Southern Corporation.

Dec. 1.

Space in This Number.

as

certain, shared by men of goodwill everywhere."

Two With First Southern \

,

Regular Advertising Rates Will Prevail

;

■

-

Co./,. 11 Marietta St.,
>

of the

himself with

;

Supreme

as

Church.* I join

Northwest, members * of the New.r
;

man

a

concern

besides being modest and approach¬

Pope John XXlil,

"Your Holiness:

added to. the; staff

York Stock Exchange.

He is

likely to

Eisenhower

congratulations

J. R. Miller and Robert F.




to

Robert < G.

—

more

affairs, it is felt.

President

"

been

of Courts

difficult period,

,

appearance; he is robust looking and affable in;.

speech and

Exchange,

'•}.

Following this, he be- )
a very

'

Stock

Chronicle)

than

more

Holy Father's elevation is being received with

member of the New

(Soecial to The Financial

diplomat in. the service

a

of candid photos taken during the

25 Park

postwar years.

international

Exchange.

Stock

r

•

the Church's internal interests than to devote himself to

Mr. Kuver.

will become

'

the/Vatican"s diplomatic delegate in Bul¬

as

pastoral mold and i$

Nov.

admit Herman

j

in this field. He served from 1925 until i

.

6

a

approbation throughout the world.

Vice-President of

New York

•

Papal Nuncio to Paris during

the hectic

Amott, Baker & Co, Incorporated,
150 Broadway,
New York City,v
of the

success

late in 1944

of

manager

department,

6 will become

-a

garia, later in Turkey and France.

Courts Adds to Staff V

prehensively cover the Addresses, Committee
Reports and related news developments of the

The Commercial & Financial

?.

v

of the Roman Catholic Church and has known

and

Anthony Lund to Be
Amott, Baker V.-P.

publish its all-

space

the balcony of

on

t,of Rome and-Sovereign of the State of

-v

best wishes for the

Investment Bankers Association of
America Convention Issue. This edition will com¬

For

City."-

Expenditures for
development alone
will likely exceed $20 billion each
year by 1970. The money industry
invests each year on new plants
and equipment will be double in

important

advertising

Dec. 4,

on

•'''S

Pope John XXIII has been

comparable.

research

York

of America

Please rush your

his L

as

(pajtfojficJfyntiff 7

tl^

Basilica/and; before the multitudes of the *

of the Province

does

Industrial growth will obviously'- '
V :;

of the New York Stock

Investment Bankers Association

for

XXIII'V

West, Primate ofTtalyr, Archbishop and Metropolitan

1970, two out of three of America's r f

*on Nov.

.

•

Pontiff of the/Universal Church, Patriarch of

fn;_th,e„-. Supreme
living.' By/ the

of

Hemphill, Noyes & Co., 15 Broad
Street, New York City, members

of the

course

Cardinal

Lord

"John

City gave his first blessing "Urbi et Grbi"^tb the

rise

standard

To Admit H. H. Kuver

Annual Convention Issue

-

11th

increase

Hemphill, Noyes & Go.

47tli

Convention's

the

Ciiy of Romeandiatheworld.

;

able in

I multitude

on

A
The Catholic world of one-half billion souls once
by a third in con¬
disposable income compared * more was, with a spiritual leader, "Bishop of Rome, Vicar
with a population increase half 5
of Jesus Christ, successor of the Prince of the
Apostles, i
that amount provides a certainty .

An

Exchange.

On Dec. 18, the CHRONICLE will

Reverend

chose

The newly elected Pope appeared
Peter's

Eternal

,

.

just over $300 billion will probably exceed $450 billion by 1970.

;

St;;

,

today.

in output during the

for materials

successor

to bear that name since the death of John XXII

r

l

on

60,000,000 households will live bet¬

will

Most

Gross

faster

presence

pace

the

Roncalli

1334.''

*

billion

members

,

Eminence

Guiseppe

haibe" ahclvbecamd

the way to $500 billion by. the end *
of next year and will be nearly

disposable

elected

;

,

day's voting by the 51 - Cardinals, in

automation.

of customers ready
to
buy.
The heavier ordering
which has taken place means a

the trade of the world's most vital

creative

been up sharply and
enthusiastically report

has

exhibitors

against

e l'S

at the trade shows in recent

days

age

National Product will be well

$600

was

world-wide Church.

unofficially set for Sunday, Nov. 9;

ket and labor force will go a gi'eat
increase in the
total
output of

and

of^

the head,

as

Pope John XXIII will be

pro¬

$500 Billion GNP in 1959

goods

was

sumer

Thus, for example, the attend¬

va¬

rieties of barI*

of

tions

the

Along with this

Evidence

Venice,

Nov. 25 next and is the 262nd Supreme

on

the third

on

Angelo

multiply. Especially heartening is
that most of the recent indica¬

American

the

are

of tnese young adults
1970, and it is they who will
provide the bulk of the labor
for

Oct. 9, 1953,

on

to rule the destinies of this

Pope John XXIII

-

of

There will be over,:

more

/.

the

consequences

by

receding recession
of

evidence

but

/

ballot

i>u,uuU,00u

force

Patriarch

Catholic-Church.

old

years

Since this is the age-

found indeed.

moment, some of our
economic muscles still ache, with
the cramps of a

; 77

byL Pontiff

marrying, the
building and buying and
furnishing, and is responsible for
most of the family growth, the
economic

Roman

the

the.
between 20

those

of

Roncalli,

::

and deep public interest,

Tuesday afternoon, Oct. 28, 1958 to succeed

on

years,

home

this

At

anniversary. It
is

Recovery

Traces

brates its 25th

10

same

of suspense

Pope Pius XII, who died

more

the

week

a

Guiseppe

chosen

group that does the

now

genuinely

can

in

year

than

more

and 29 years old will increase

Anticipates a $500 billion G. N. P. in 1959, $600 billion by
1970, and a doubling of new capital investment in 1970.
It is

In

with

people by 1970.
But
population explosion
significant than

a

far

population

being in the foothills of the Fabulous '60s and indicates some
of the dimensions of growth that will "stagger the imagination
and will stretch even America's fantastic capacity to produce."

divides

is

is

that

commodity trade the
creative phase of dynamic capitalism and optimistically depicts
the current evidences of business recovery that "portend substantial improvement still to come in the months ahead." The

Anniversary,

nation

a

Thursday, October 30, 1958

.

/' : WILL REIGN AS. JOHN XXIII

•

Of the Fabulous 1960's?

.

CARDINAL RONCALLI IS NEW POPE

Ameri¬

even

.

He

c/o Chronicle. 25 Park PI. N. Y 7

V,

Volume

Number

188

5790

.

..The Commercial and Financial Chronicle

(1775)

makes

Belt

ine

it possible for an operator
perform correctly each step in
relay, asseynply or fabricatiori

process; just by following precise
oral instructions, delivered via a
.small transistor receiver, and a
listening device.
This guidance

Convey#! of

By DR. IRA U. COBLElGH

has

Enterprise Economist

swift review of a company uniquely
'upgrading office efficiency.

quite

advance

a

—

A

1949

to

ne

.

proven

faster

and

more

effi¬

cient" than having
the operator
keep transferring his vision back

effective. in

;and forth from printed instruction

i

sheet,

to

the

assembly.

adapts itself to

a

AIMQ

-

broad

variety of
unmatched dicta¬
■industrial and governmental uses
old. Copyrighted back in 1906, it
technique—an electronic boon
tor*both individual and group in¬
to the two and a half million sec¬
referred to a "business dictation
struction .and direction.- 77,
machine manufactured by the old retaries in the United States. Dic¬
Since 1956 the company has enG fflu mbia
taphones may not improve the
7;
;
Gr a m ap hone 7
:boss's<" disposition 'but
"Tillie" Joyed expanding sales of the "Cor¬
vette" bf its line, its Dicet
portable
won't have to spend so many hours
Ctf.
This hist- ^
recorder.
This attractive
a week putting up with it! He.can Voice
chine, in turri,77
little receiver is truly portable. No
now dO all his dictation- when she's
was^ a refine- J*
.•bigger than a home m'ovie camera,
'ment/of
The

name

Dictaphone is 52 years$

and

present

an

tion

.

..

.

to

$36,000,000 in .1957.
in

per

share

tion

The

net

of

Mr.

C.

K.

11

Woodbridge,

(ad¬

Chairman, and Mr. L. M. Powell,
justed) has .been equally, impres-r* President, -has been;
outstanding,
sive—from $1.07 in 1949, to $4.38 as evidenced not
only by the con¬
in

1957.
(Net per share was
tually highest, $4.-76, in 1956.)

tinuous

ac¬

in

out

in

annual

cash

past decade

was

also

1957-as

result

stock

the

ill

ad¬

an

unusual group of men
and leadership in

of, attainment

There

many

split in

which

of

achieved

made

by

promotion and selling.
Board of Directors is com¬

posed of

amounting to

4-for-l

a
a

The

distribution

approximately 36% of net.

results

advances

line, but

vertising,

interruption since 1926, with
the

technical

product

dynamic

Dividends have been paid with¬
average

the

therfe

lines of endeavor!

Dictaphone has fidt only secured
commanding portion
of
the

are
pow 570,000 common shares a
outstanding, preceded Only by $4" American market, in its field, but
million
in -long : term debt and is moving rapidly ahead elsewhere
12,208
shares' of 4%
preferred ' through; subsidiaries in Canada
($100 par).- Patient stockholders.; and England, and distributors in

here;have
market

seen

value

in 1949 to

their shares rise in
from

a

low

of

62

•

.

countries

it's because

high of $62y2 irr 1957.

a

other

of

the

world.

(If it doesn't do business in Russia

$4

they've had

too many

Present quotationr is around $51 "dictators" there
T
already!)
l
While the major business ;of the tdt^^w^jpikwbut two pounds ill with a $1.20 dividend indicated. ;
It is a pleasure to review &
ouncesj runs on a battery arid
company is in dictating machines,
•V The recent recession has had its company
such/ as
Dictaphone
Ipaclcs enough magnetic tape for an
by Alexander '
effect on business at Dictaphone ^which is, almost a copybook-exDiCtaphohe Cgfrporation^is also the
fliqur'5 irecording. It's a magnifi¬
Graham Bell
largest and oldest manufacturer of
•since its sales are sensitively re¬ ample of a successful and expand¬
cent /travelingr companion, great
and one Ghaff.: ^ ■
lated to the rate of general busi¬ ing corporate enterprise.
recording equipment fpr industrial
For its
-fby on-the-spot usep especially for
and government use. «It provides
Taanter, Which V
ness activity and levels of
capital 3,000 employees, 1,700 stockhold¬
.-business
orprofessional people
produced the 7
!»buftd ! recording.. equipment
for
spending.
Thus results for 1958 ers, and myriad customers, it has
'who move around a lot. Starts and
oldest recordare expected to fall somewhat be¬
mdnitoring rddio broadcasts, tele¬
performed long and well. And in
stops at the press of a thumb. It
i ng we n ayy '
low lifol figures. The future, how¬
the area of office
phone' recording and ; air -traffic
management, It
/can
;even be rented now on an
h a v e of the
contrbl; " and has Specialized 'in American
ever, of this research minded, and
has done a unique job in stream¬
Express Credit Card,
human
voice.
magnetic 1 tape recording.
Dicta¬ like a Hertz car.
enterprise
Pick a Dicet up aggressively managed
lining the flow of correspondence
When
you
phone recently received its larg¬
appears excellent.
The company
in one city and drop it off in anfrom the mind to the mail chute.
turned the crank
(by hand) on est single recording machine order
has
three plants
in Bridgeport,
other.
Dicets
are
also standard
this
primitive prototype,; words from* Civil Aeronautics Adminis¬
Conn., four in England, and has
equipment for in-flight recording
spoken into the mouthpiece cre¬ tration for 452 Dictatape record¬
just opened a brand new plant in
by passengers on Capital Airlines.
Guardian Sees. Co. Formed
ated
vibrations in a diaphragm ing machines and 175 transcribers
•Concord, New Hampshire, for the
From the foregoing, you can get
that moved a stylus up and down
(for use in traffic control towers
manufacture of Dictabelts.
RENO, Nev.—Guardian Securi¬
a pretty good idea about the Dic¬
cutting "hill and dale" grooves in at commercial airfields).
In common with most "growth" ties
Company has been formed
taphone product line; but perhaps
a wax coated drum.
The latest development at Dic¬
companies, Dictaphone emphasizes with offices at 140 North
you are unfamiliar with the quite
In 1923 Dictaphone Corporation
Virginia
research
and
taphone
is
AIMO
(Audio
In¬
development
and
remarkable growth of this com¬
was
Street to engage in a securities
formed as a separate enter¬ structed
now
has
Manufacturing
Opera¬
nearly
100
engineers,
pany, and the splendid financial
prise for the development of dic¬
scientists and technicians
in its business. Officers are William B.
tion), a revolutionary new method results it has achieved for its
long
tating machines, witn Mr. C. K. of
providing ta$ed voice instruc¬ term shareholders. In each of the research and engineering division, Mead, President; George C. Wood¬
Woodbridge (now Board Chair¬
busily at work on refinements of
tions, rather than printed words
ward, Vice-President and Assist¬
past nine years, net sales of Dic¬ the
man) as its President. It produced or
present line, and ideating the
diagrams,
to
manufacturing
ant Secretary and Raymond H. C.
the first experimental electric dic¬
workers.
AIMO was researched taphone Corp. have rbaehed a new products of the fu+'^e.
tating machine
in
1936.
This
Management, under the direc¬ Bissell, Secretary.
jointly with " Westinghouse
and high, rising from $12,800,000 in
worked so well in actual operation

hot; abound!-'

;a%

cruder

.

onein-7

vented in 1881

•

;

,

that, with

some

placed

was

on

modifications,

it

the market in 1939,

moving the company along the
high road to outstanding success.

This

'All the

while, however, the com¬
sought an improvement on
the wax cylinder; and in 1947 it
^revolutionized the industry with
,

pany

its introduction of the Dictaphone
Time-Master- dictating
machine
and by replacing the cylinder with
the-, sensational new
15-minute
Dictabelt. This plastic endless belt
offered obvious advantages:
vis¬
ible
tone
grooves
allowing -the
user - to
find his place quickly;
sharp and clear playback; nonerasability; and far more comcpact
filing and mailing.••••

/

.

offer to buy

.

any

'

ISSIE

■

offer to sell,

solicitation of

or as a

an

of these securities, The offering is made only by the Prospectus.

-■v'/1

>
NEW

is under no' circumstances to be construed as an

announcement

v;

:
.

.

M'

.

'

,*»■";»,

'

;

..

October 29, 1958

V

-

.

300,000 Shares

..

Finally, in April, 1958, thCre was
offered

in automa-

the last word

tion-^-the

Dictaphone

new

.

Time-

Master with touch-button control.

Common Stock

Transistor

actuated, this marvel of
electronics and phonics is' ready
for action the moment you pick
the "mike"—no
time needed. Touch

"warm

up

a

:K.

No Far Value

+

up"

button and

record, hear the playback,
correction, or indicate the
length of a letter, instantly; Load¬
ing and unloading the Dictabelt is
you can

make

a

idone automatically — just by
This dictation

also

pushing a button.

unit is matched' with

transcriber

ter

also

for

transistorized

button control (the

a

Time-Mas¬

secretaries/ —
with
touch

transcriber not
which adds

the secretaries!) AH of

to
effortless dictation
and
swift perfection in transcription.

up

This Dictaphonic dream
is

all

does

quite wonderful
it

offer

over

the

Copies of the Prospectus may be obtained in any State in which this announcement is circulated from only
of the undersigned or other dealers or brokers as may lawfully offer these securities in such State.

such

machine

but what
old

fash¬

Merrill

and her note¬
deal!
The com¬

ioned stenographer

book?

A

great

pany estimates that a $10,000 a
year executive will save at least
$1,000 a year in company time.
No longer will the secretary be
called in, pencil poised, only to sit
around while

Mr. Jones

•

phone, hems and haws, men¬
tally organizes what he wants to
say and gropes for the right words
and phrases to implement it.
No
more
"frozen
notes,"
either —
shorthand in writing that only the
taker caw read; and pure Sanscrit
if she's not at hand tcf transcribe!
new Dictaphone units reduce.
«33fwsyt-; speed.correspondence,
eliminate stenographic drudgery,

The




Kidder, Peabody 8C Co.

Dillon, Union Securities 8i Co.

The First Boston Corporation
i

Lehman Brothers

Smith, Barney 8C Go.

-

*

\

.

White, Weld 8C Co;

answers

his

-

Eastman

Lynch, Pierce, Fenner 8C Smith

Clark, Dodge 8C Go.
Carl M.

Drexel & Co.

Loefcr, Rhoades^fiS Co.

Hallgarten & Co.

Laurence M. Marks

Paine, Webber, Jackson 8C Curtis

Co.

Hornblower 3C Weeks
F. S. Moseley Sc Co.

L. F. Rothschild 8c Co.

12

The Commercial and Financial Chronicle

(1776)

such

distrust

Is Gold

enced

Superfluous?

Provides

leading monetary economists believes it

ratio
is
point of view
of the Western
World.
It is the only fixed point
in
an
essentially
fluid
world
economy. There would be nothing
gained if through the removal of
(his fixed point the international

the

is

ratio

worsen

essential

—

Speaking at

the Annual

Meeting of the Inter¬
Fund at New
Delhi on Oct. 7, Mr. ; Anderson,
.Secretary of
the Unite d
national

,

States

Monetary

Treas¬

World stability and provides

bled

that

system

—it

-which*

reasonable

seems

to

assume

such a switch over of
productive capacity
the Soviet
by

Government would be able to ac¬

quire

under

i

.

«

S

t

NSTA

f

' '4

■*) *

*

Notes

the

were

to be converted into

waters.

SECURITY TRADERS CLUB OF ST. LOUIS

Security Traders Club of St. Louis annual election party,

At the

the following were named to serve as officers for the

coming year:

excellent

with

'

-

.

prices—even allowing for the international credit. With

war

Government's

existing

i

and equipment would
Mr.
Leon's contention is that
available for producing
since only a small fraction of in¬
goods available for export. ternational balances is settled in
Since these goods could be sold
gold the entire settlement:might
at twice or three times their pre¬ as well be made with the aid of

(bstaele of politi¬

maintain1

¥ ♦

become

Communist goods

to

'»"* tt* '

other

to overcome the

the

«

manpower

cal antipathy to

determination

>• i

stability

Communists

the

emphatically realf i r m e d his

„

•

opportunities for fishing in trou¬

cuts that would be made in order

ury,

.

dollar-gold

< «

gamblers' paradise. This to¬
gether with the weakening of the
financial power and prestige. of
the United States would provide

not

for Western

» ♦

a

opportunity for fishing in troubled waters.

less USSR
LONDON. Eng.

we

the

markets

(2)

implicitly";

finance would

of

forget: (1) "why dollars are
international credit in trade and
without gold; and (3) fixed dollar-gold

that

asks

writer

trusted

to demonetize

us

from

essential

Thursday, October 30, 1958

oc¬

War?

Fixed Point

Only

fixed

A

would

gold as sug¬
gested by Rene Leon (Chronicle, Aug. 14). Dr. Einzig denies
our mint purchase
price aids the USSR but agrees that to
raise the price above $35.00, as suggested by Keynes's biogra¬
pher, Roy Harrod, would confer a free gift on the Russians.
In endorsing our Treasurer's reaffirmation of gold price fixity,
"height of folly" for

be the

dozen

a

casions since the end of the

By PAUL EINZIG

One of Britain's

half

.

experi¬

sterling

as

some

on

.

.

dollars than by con¬

more

some¬

a

consistency he ad¬
vocates in the same breath the
abolition
of
the
International
dubious

what

,

Fund

even

facilities

credit

go

Kfinetfc J. Jansen

Herbert lb Rutch

Ruburt A. Pairii

though, its
long way
towards supplementing the inade¬

Monetary

a

quate*, gold reserves available for
international
settlements. /What

give gold production he overlooks is that the demon¬
high priority at the expense of etization of gold would lead to a
other industries.
That in spite of drastic
contraction • of
private
tinuing

gold

and dollars

to

-

inter-

are

Such

state¬

a

ment of
was

production has such a credit resources available for the
high priority
in the USSR is requirements of international
probably due to considerations of trade and finance. Should gold
prestige,
considerations of
the cease to be dependable for inter¬
this

changeable at.
$35 per ounce.'
Or.

Paul

Einzig

policy

gold

kind

same

indeed overdue in view of the

recentrcrop of suggestions advo¬
cating 'or foreshadowing funda¬
mental changes in that policy. On

the

Government

manufacturing

top priority to the
of

induced
to give

tnose which

as

Soviet

sputniks.

.

national

payments

defaults

on

'

would Hend

Mr, Leon

Manpower and other productive
resources in the Soviet Union are

risk

in favor of raising the
official American buying price of

l'ully used to the limit of capacity.

international

agitation

other hand, there
was a revival of the demand, pop¬
ular during the inter-War period,
that gold should be demonetized
altogether.
gold.

the

On

was

expressed

article
by Mr. Rene Leon appearing in
the August 14 issued of the Com¬
and

mercial

Financial

Chronicle.

He demands that the United States

Treasury should discontinue buy¬
ing gold at the fixed price of $35
per

His main argument
buying all gold at that

ounce.

that

in

voted to gold
be

possible to devote more pro¬
capacity for the produc¬
of H bombs, or for the pro¬

ductive
tion

price regardless of its country or
origin the United States Govern¬
ment provides economic assistance
to the Soviet Union, has strong

surpluses to
the markets of

duction of exportable

into

dumped

World

Free

the

latter view

The

with much emphasis in an

productive capacity is de¬
production it would

less

If

be

Answers Rene Leon

detriment

the

to

of producers

of the Western coun¬
to say the least, open
lo
doubt
whether
the
change
would be to the advantage of the
tries.

It is,

the

of

and

States

United

Free

Perhaps it is
as well from our point of view if
Moscow is not discouraged from
in

World

general.

using a by no means negligible
proportion of the productive re¬
command

its

the

for

sources

at

purpose

Of

course,

deserves to
closely.

more

if the United States

There is, however,
important argument

Leon's

Rene

a

much more
against Mr.
that

contention

it

Treasury were to follow Mr. Har- would be detrimental to Soviet
suggestion and raise the of¬ interests if gold were to be de¬
ficial buying price of gold to $100
monetized. He does not appear to
per ounce it would confer a free realize the immense
importance of
gift on all gold producers, includ¬ the limited monetary role played
ing the Soviet Union. It seems,
by gold from the point of view of
however, that the prewar price the
financial
strength
of
the
of $35 per ounce contains little or
United States and also from the
no element of free gift.
There is
point of view of the financial and
no reason to suppose that the cost
economic
stability of the Free
of production in terms of manWorld.
He
cheerfully contem¬
hours and equipment is appreci¬
plates the prospects of a heavy
ably lower in the Soviet Union
slump in the market price of gold
of the increase in costs the price
of $35 per ounce cannot be re¬

garded

as

erring

on

the generous

side.

as

result

a

official
fixed

-

of

the

purchases at a
Has it not occurred

that,
existing price

while
of $35

a

be acquired

can

also through

the

export of goods other than
gold, and that the Soviet Govern¬

fall in

$20
of

per

the

these

are

would

foreign

uncovered?

lars

price of gold to

ounce

The

trusted

part
holdings

dollar

why dol¬

reason

implicitly is

cisely the existence of

say

leave

a

pre¬

substan¬

eminently in a position to
by reducing the price of its
goods available for export to a

tial excess of gold holdings over
foreign holdings of dollars. Would

level at

the

with

ing

do

so

which they can compete
goods produced in the free

world.

The

not done
cause

reason

on

a

why this is
larger scale is be¬

most of the

output of Soviet

Russia is needed to meet domestic

requirements

or requirements of
other Communist countries. If the

Soviet

Union

production

did

high

not

give

priority




gold
more

written

be

with

the

in

down

the fall

in

accordance

the market

Mr.

of

it

not

be

the

United

height of folly for

States

authorities

for the United

exceeded the British
Would

Mr.

Leon

gold

like

to

reserve.
see

'

the

dollar exposed to major waves of

•

Vice-President:

Third

W.

Secretary:

Government and for the American

interest
in
the present
monetary role and monetary value
taxpayer

vested

a

of maintaining

favor

gold.

Franklin Johnson With
I

I

AUfa.AM*«

D...

IfflUS III LaWlBllGB OOIIS
Cyrus J. Lawrence & Sons, 115
Broadway, New York City, mem¬
of the New York Stock Ex¬

change, have announced that
Franklin
sociated

Johnson

P.

with

investment
Mr. Johnson

their

is

now

firm

in

as¬

the

advisory department.
was formerly a Vice-

Jack

.

,

Elmer Jarrett,

Newhard, Cook & Co.

Wichmann, Stifel, Nicolaus & Company
Fusz-Schmelzle & Co., Inc.

Richard A. Schmelzle,

Treasurer:

i

Yes, but
"It is

universally true, in my opinion, that gov¬
strength and social stability call for an
economic environment which is both dynamic and

ernmental

financially sound. Among the principal elements in
maintaining such an economic
basis for the free world are (1)
continuing growth in produc¬
international as
well as domestic; (2) financial

a

tive investment,

policies that will command the
public, and as¬
sure the strength of currencies;
and (3) mutually beneficial in¬

confidence of the

ternational trade and
effort

avoid

to

a

constant

hampering re¬

the freedom of ex¬

President of Manufacturers Trust

strictions

Company where he administered

change transactions." — Presi¬
dent Dwight D. Eisenhower.

the investment of institutional and
individual funds.

We

Robert W. Clark, Jr.
With Burns, Corbett
(Special to The Financial Chronicle)

CHICAGO, 111. —Robert W.
Clark, Jr. has become associated
with Burns, Corbett & Pickard,
Inc., 135 South La Salle Street.
He was formerly with Eastman
Dillon, Union Securities & Co.
Prior
thereto he was syndicate
manager for Arthur M. Krensky
& Co., Inc. and for the Chicago
office

of Lehman Brothers.

&

Incorporated.

States

de¬

During the whole postwar period
sterling has been highly vulner¬
able
precisely
because
foreign
holdings of sterling have greatly

Yates, Heitner

Kenneth J. Jansen, Edward D. Jones &

Second Vice-President:

Co.

The pos¬
gold reserve

huge

a

has created

bers

Roach,

M.

Leon's bright idea.

session

of

Scherck, Richter Company.

Herbert

Woods.

terms
on

valqe
of gold.
This consideration alorie
should be sufficient to dispose of

liberately to sacrifice this position
of strength?

ment is

in

amount¬
to many billions of dollars.
gold reserve would have to

The

States would be able to pay out in

gold all foreign holders of dollars,

lars

gold

inflict

would

Vice-President:

First

action

American taxpayer a loss

under
the
the United

for the

of acquiring dol¬
lars.
What he
appears
to have
completely overlooked is that dol¬

deliberate

depreciate

dollars

of

President: Robert A. Pauli,

credits.

a

Richard A. Schmelzle

W.Jack Wichtnaitn

Elmer Jarrett

of

by the United States Treas¬

to

ury

to increase

granting

of

American

price.

him

to

cessation

It is Mr. Leon's assumption that
Soviet Russia exports gold largely
purpose

taken

the

to

Cannot Ignore Gold's Importance

rod's

than in South Africa. And in view

attached

Finally,

of gold production.

emotional appeal and

be examined

debts

Likewise
the wild fluctuations envisaged by

one-hand' there was5 renewed

the

of

risk

the

international

would greatly increase.

on

doubt

whether

would be any need
to

Pres.

Eisenhower

there

for the President or anyone else
continuing growth in

trouble himself about "a

productive investment" if and I where conditions
propitious for it exist.
Sound "financial policies" and the avoidance of
"hampering restrictions on the freedom of exchange
transactions" are undoubtedly among the elements
which promote

conditions propitious for productive
are not by any means all of

investment, hut they
them.
One

thing which does not help is to pretend such
do not—or act as if they

conditions exist when they
existed.

Fahey, Clark Adds
(Special to The financial Chronicle)

Fahey is
&

now

Ohio—Robert J.

Exchange.

of

Powell Adds to Staff
(Special to The financial Chronicle)

with Fahey, Clark

Co., Union Commerce Building,

members

With Interstate Sees.
(Special to The Financial Chronicle)

CLEVELAND,

the

Midwest

Stock

FAYETTEVILLE, N. C*.

CHARLOTTE, N. C.—Theron T.
Kinzie is

curities

now

Corporation,

Tryon Street.

thur

with Interstate Se-

/

200

South
*

C.

Blue

has

—

become

Arcon-

nected with Powell & Company,
Inc., 120 Anderson Street. ■ . ■ j

Volume

Number 5790

IBS

...

The Commercial and Financial Chronicle

.

(1777)
{ *

and

destroyed.;^ Can it be done? guise in the new one; When, fol¬
It; calweys*. is,: ,6ir • T^y,r. fcuA ,'if Jwe: lowing «vtbe, * current, ,and;
would be "good guys" and heroes, spread "smart" advice, investors
we

must have bowi wisdom to see

the. truth

:

for it.

By HON. WALLACE F. BENNETT *
,

*

\

Utah'*

..'United

of the

Senator

"

Republican

States

•

•

(Rep., Utah)
If

Senator recommends government power
Instead of recourse to wage-price

•

and

courage

;

i

■'

:

• .r

•

-

are

to

win

the

against inflation, what

stocks,

1?
;

feel alone and
helpless. We know
«Oinething«nuiSbbe: done—but how
and by whom?
f

Let's return to

our

Western; for

to- fight; he pushes these prices up beyond ; the answer. When the desperadoes
'* : "S the breaking; point He did this seem to have taken over the town
in '29 and can do it again. When* and the law men can't control the

Monetary Controls; Are:
Inadequate
we

flee from bonds to common

■

they desert stocks for real estate,; situation there's always one final
prices can go so high that powerful force, the law-abiding
themselves.' When ithey

these

fight When- they break, the.-values will; citizens

resources

not meet the

mortgage, and fore¬

.

out

of hiding; and form a
Well/ law and order- closures destroy the market. This posse of Vigilantes, the good
guys
Since inflation also happened" in the 20's, and the
controls, "Senator Bennett would have the government deny
always win. Where can we find
is a crime against the value of'
or
them for this fight and what will
upward spiral .has begun again;
suspend wage or profit increases Whenever priceievelrose
money, we have the central mone¬
until sudi tone as when prices returned to their former level.
And it can happen to any man . bring them out?^ <
;
tary authority, the Federal Re¬ who goes too deeply, in' debt, beThere, is a feeling of power ;that
So long as prices drop r or stay staMe every year, labor and
serve Board,
It has the rcsponsi-1
cause while at first it can produce
comes to simple
ordinary people.
coital would be perfectly free to divide file producers' share
bility - and the power to move the illusion
of
prosperity,
by when they havd a cause, and
against inflation by restraining
of increased production and productivity in accordance with
creating booms as it did in '55 and when they have a Weapon ah their
the growth of the money supply^
normal practice. The Senator sees no hope in monetary
'56, these are always followed by hands, A simple,; powerful weapon
when necessary, putting it in jail,
unemployment, with its inevitable every man, woman and ehildr can
controls alone, and avers that by making stable or lower prices
so to speak.
But inflation still has increase
in
repossessions
and use. The need to destroy inflation
at every level of
many friends, men and organiza¬
production and distribution a fixed public
bankruptcies; ' V •
'
is a worthy cause and the neces¬
tions with great political power,
policy, tbe Consumer would be protected from inflation.
sary weapon exists if wer have thd
and they can and have prevented
Unsupportable Wage and Price
courage to use it. What is: the
Increases
Prosperity, the enjoyment of a described as an attitude, it can be full control of the villain. To rely
weapon? A positive«program to
high and rising standard of living, achieved only through tangible, on monetary controls alone may
But these are, in a sense, limited control
prices •>at the consumer
has always been the chief eco¬ solid economic growth. The faith be too costly, particularly in terms
and specialized disasters that be¬ level, so
thatlthey will either stay
nomic goal of what we call "the which underlies it must rest on a of unemployment.
fall the smart, the unwary or the: level or
drop. If this can be made
American way
firm and dependable rate of eco¬
The Federal Government has foolish. There is a great area in to
work, inflation in the form of
of life."
nomic
growth • and
expansion. another power, whose effect may Which all of us are its victims
Infla,--,
price inflation can be licked.
A
Measured oyer the long pull, we be described as
tion, like sin,7
negative. It rests the area of unsupported pnee^Jand /Sounds simple
c doesn't it?
But
is generally'
have had such an expansion here on
our willingness as citizens to
wage increases. By unsupported, A does it aiso-sound;, like; a pipC
in America. As producers of ma¬
regarded as anlet the government live within its I mean those wage- increases that"
dream, a worse illusion than iri4
terial things, and creators of serv¬ income,
ev.ilVto be
When, the budget; is bal< are not validated -by increased, flation?^ Let's7check* the facts and
ice patterns, we are superb.
avoided on'
We anedd at dny level, it is difficult productivity, arid those price in—'
see.
are
principle. Ye t
imaginative, resourceful and for inflation to operate.; But when creases that are not matched, by; i
i Here are the essehtial features
somehow t h e
courageous.
We can' combine art' the town is wide open, so to speak,
greater -value.- This is the aspect; of such
a program as T see them;
arid science, ingenuity and effi¬ and
two have got;
we force the government to of inflation in which we in busiall tangled;upciency, We have-learned to iise live beyond its incorrie, inflation ness are both the unwitting and;
(1) .True prosperity dependg
t o g e t h e/r
amazing accuracy to produce both flourished, and even the sheriff of often
unwilling accomplices, andn fundamentally on our ability to
in our think¬
volume and variety. We ought toThis/ keep; on; increasing our capacity
monetary policy can't arrest him; the unsuspecting Victims.
be the happiest people on earth,
to produce. This, idea is expressed,
ing. Over the;
Inflation is
a
versatile. thief,, is the kind of crime that wo niust
last 20 years, i
living***
perma^ah^rbspe^it^,^ : who/can work in many fields of someday stand and fightagamst. - in the phraso- "rate of increase.in
inflation -h as'
productivity." It is not measured;
: Instead,
for a J generatipijflve crime, He.can be the world's most
I know there are millions of
proven the
r;
by what, we have produced. or
have
constantly been bfesset' by successful confidence
man,
and Americans who are beginning to consumed I in, the
more "consist-w«H*ee F,
»past.< and cer-;
fhars, swinging between We- poles the meanest pick-pocket. When recognize this evil and who are
ent and durable of the two. While of boom and
tainly not by the volume of d61V
gloomy uneasy and people try to flee from him in one
becoming aroused to meet its
we have had periods of recession,
uncertain.
Continued on page 29
y ■
area, he meets them in a new dis¬ challenge.. But all. of us seem to
when prosperity disappeared for
The Riddle of Inflation
a - time,
inflation has flourished
steadily. This has led to the be¬
The key to this paradox is in¬
This advertisement is neither an offer to sell nor a solicitation of offers to buy any of these securities.
lief that the two are inseparable.
flation, which is as much a mani¬
The offerings are made only by the applicable Prospectus.
Some accept inflation as a neces¬
festation of human weakness as

be used to end inflation.

do

are

come

have?

we

on

our

side;

v

.

,

>

price-we must pay for pros¬
prosperity is of spiritual strength.
perity; others have come lately to And the trouble seems to come
regard it as a positive benefit, a when we face the
job of translat¬
part of the formula for greater ing material values into money
sary

October 29, 1958

NEW ISSUES
;

cv.

prosperity.

values.
We, who are practical,
knowledgeable -and hard- headed
when we deal with things, become
damage it has done to other econ¬ as children when we deal .with

today, fortunately,
more
and more Americans, aware of the
But

omies

their own lifetime, are; money

in

The Hartford Electric

naive, soft-headed and
magic. ' We: accept

—

asking what can he done to pro¬ believers

Light Company

$18,000,000

in

without inflation; money as wealth, When it is only
They realize that inflation is a an artificial means to, measure
malignant disease Whose danger¬ trade
and
store
it.
Believing
ous cells can grow and expand at
money is wealth, we can be per¬
an ever-increasing rate, until they
suaded that we can increase wealth
duce prosperity

normal by.

off the sound and

choke

of
growth
from
which:
healthy prosperity comes. Or, to
change the simile, they see it as a
deadly habit * forming narcotic
which produces the
illusion of
prosperity, but whose destructive
dosage must be constantly in¬
creased to a point of no return.
cells

expanding

4%% First Mortgage

due October 1,

supply
of
: particularly in
the hands

money,
Of consumers.

Fe d

e r a

1

the

And

.

because

Government

Price 99.25%

the

plus accrued interest from October 1,1958

creates

money, we can be made to
that it, and not we, can

believe
create

prosperity.
Believing
backs

on

this,

the

We

substance

turn
of

100,000 Shares 4.96% Preferred Stock

our
pros¬

relationship of perity, production and productiv¬
prosperityiand inflation? Are they ity, because they seem the hard
partners, or antagonists? Are they way, and reach for inflation, the
inseparable, or can we have pros¬ shadow and illusion, the counter¬
perity free from inflation? If we feit, because it seems the easy
can, how can it be achieved?
way, the promise of something for
nothing. True, for some people,
Defines Prosperity
and for a limited time, inflation
First, Awhat is prosperity? Es¬ can be profitable. But whatever
sentially, prosperity is a feeling, they gain is stolen, not created,
an
attitude* a frame of mind. It stolen from the past 'and future
exists when we have faith, faith for the temporary present, stolen

-

What is the true

149,633 Shares Common Stock
(Par Value $25 Per Share)

our standard
from the weak and helpless, the
living is rising and will rise old and ill, for the greedy and
steadily in the future, as far as we rapacious.
can
see the future.
This feeling
Far from producing more pros¬

satisfactions

the

when

we

feel

sure

that

that

our

Holders of the

Company's outstanding Common Stock are being offered rights to
$56 per share for the above shares of Common Stock at the rate of one
share for each ten shares of Common Stock held of record at the dose of business on
subscribe

the

productive

Time,

capacity,

to produce and achieve is distorts the measurerhents of
prog¬
also going to increase.
It is sus¬
ress,
and obscures as well as
tained by our enjoyment as con¬
stunts the rate of growth. It makes
of

the

necessities,

com¬

its presence

on

but

tection

loved

ourselves

for

and

our

against the risks and

ones

accidents of illness and old age.
But

although prosperity

"An•= address

tbe

American

Association,
7,

by

t

Sen.

Hardware

Atlantic

can

Bennett

be

before

Manufacturers

City,

N.

1958.




JL

Oct.

its

,

any

unsubscribed shares and, both during and following the subscription period, may

offer shares of Common Stock

as set

forth in the Prospectus.

felt in different ways

forts, and even some of the ex¬ in
various aspects of the economy,
travagances of life. It is particu¬

larly rich and strong when we feel
that, by self-restraint, saving and
sacrifices, we have provided pro¬

Subscription Warrants will expire at 3:00 P.M., Eastern Standard
November 17, 1958.
r
agreed, subject to certain conditions, to purchase

The several Underwriters have

power

sumers

at

October 21, 1958.

perity for all, inflation warps and
thwarts

(Cumulative, Par Value $50 Per Share)

Price $50 per share

of

come

•

plus accrued, dividends from November 6,1958

and confidence that

includes

Bonds, 1958-Series E,

eventual

effect

is

Copies of the applicable Prospectus may be obtained from any
of the several underwritersy including the undersigned, only in States
in which such underwriters are qualified to act as dealers in
securities and in which the Prospectus may legally be distributed.

always

destructive.

Are

prosperity and inflation
or antagonists?
To use
the
symbolism of the so-called
adult. westerns, prosperity is the
"good guy" and inflation is the
"bad guy." As in the pictures, the
"bad guy" is often mistaken for
the "good guy,"- but. if the story
is to have a happy ending, he
must
be
discovered,
unmasked
partners

The First Boston Corporation
•'.'*.

-

'

.

..

Chas. W. Scranton & Co.

Putnam & Co.
■

.

*

•

*

,

'

U!

1-5

O

■

The Commercial and

14

courses .in; physics,
Unscientific forecasting in the
mechanical engineer- ] field of economics and widespread
ing, v mathematics;
history, iecoacceptance : of such forecasting,
nomics, philosophy, and so on; or, „ Some of the lack of science which
for emphasis, science in physics, is common in the field
of eco-

able

Thursday, October 30, 1958

8PAHR

By WALTER E.
Executive
™
'■

Vice-President, Economists' National Committee on
Monetary Policy, New York City
Professor Emeritus, New York University
*

and

which

economist quizzes

;

as

misuse

Common

are

those professing

..."science"

'•.

" V

'

;;

.

•■••••

•

-

to the meaning

"83% in U. S.
Found
to
Favor
Science," The.
New York Times (August 17), it
was
reported that "Mr. Krieghsaid

of

the persons

that

'the

is

bet¬

world

ter off because

of

cent

per

others

the

41

who

said. /

ence

Only 12

cent, how¬
ever, said sci¬

per

entists

Walter

peculiar people.

E. Spahr

Classification

were

than

the evil

for

responsible

directly

'

of their discoveries.

uses

flowing from pursuit of.
designed to obtain truth;
per
cent thought those,
pursued the methods Of sci¬
were
generally: odd
and;

methods
that

"

per

>

+

rather

description of methods
truth a common

reaching

of

scientist? were generally 'odd and
peculiar people', Mr. Kreighbaum
said."

The

and

tend to force

instructors;

pen.

those fields into
scientific}, techniques; but

such

so on

students

and

highly

to the report, "The of science, Examples appear daily many such students, and faculty,.
magazines, seem
to
have
conducted ... by the in our newspapers,
relatively/little
Survey Research Center of the other publications, and in conver¬ understanding of the nature and
University of Michigan"; the "sur¬ sation. For instance The Saturday implications of science as is ofteh
vey report was issued last week Evening Post of March 3 published
readily observable when they disby Hillier Krieghbaum, Associate an article by a distinguished mem¬
Pijofessor of Journalism at New ber of a graduate faculty of one
York University"; and the, "Rock¬ of our universities under the cap¬
tion "Science vs. The Humanities."
The

A correct description

The

ment

ence
(Adam and Charles Black,
London, 1911), 3d ed., Pt. I, Physi¬
cal, p. 12:

science

is

universi¬

of

unlimited; its material

is endless, every group of natural

material.

facts
sees

of

The

man

who

for

-

.

.......

College
and
university
logues often list "science"
the

from

tion, or

humanities, or educa¬
other subjects. -

some

for the

Reasons

common

kind whatever, who

any

their mutual relation and de¬

scribes their

sequences,

is applying

the scientific method and is
of science.

scientific

alysis,

unscientific

or

an¬

since

are

the

those

and

by which truth

methods

of

in any field is obtained, a question
arises as to why the common prac¬
tice exists

in

this country

of de¬

to the

the

past history of mankind, to

social

cities,

a man

to

statistics

the

of

our

atmosphere

great

of

the

mpst distant stars, to the digestive
organs of a worm, or to the life of
a
scarcely visible bacillus. It is
not facts

less of how imperfect his method¬

ology

themselves which make

science, but the method by which
they are dealt with." (Italic in
the original.)
It may be doubted that any
scientist, who has written a treat¬
ise On the nature and implicatons




may

be while the historian

economist who understands and

follows "the methods

regarded

The facts may belong

as

a

arises

from

small

percentage
ever

of science

an

^oDoosfte

tuined :anr an opposite

by headlines which state that Mr. oir-Jones-"sees" a market of certain v/ Many of the common procedures
size for X products next year, that; in .advertising should, be sent on

i

standing of the limits of precise

cent in .the purchase of liew

per

.

J.

«

-»■

4L

a

a«r4

/mi i

n v>

developed have much in common with tlie
seers, prophets, and crystal gazers
not under the of ancient and mediaeval times,

courses,, appar-

the

1IL'"

*1

i

nrA->

1lim

-

*

•,

If

college

a

staffed

follow

dents

and

to

be

university were

or

scientists

with

the

our

scientists

very

sonable

institution

answers

pose

of

is hardly the proper puran

"educational" institu-

tion.
It

/:•
seems

thor that

our

sities, their administrators and
staffs,, and theif
students
and
graduates fall far below the level
of trained scientists who practice
and

we

fulfill

the

re-

J.

Some of the consequences of mis
conseauence«i ot.mis-■
Some*of

seems

the

inde¬
com-

mbnly characterize them. Instead
the

au-

colleges and univery

methods

humanities

should

be

for

Failures

ments.

Proved

m

an^

;'

-

be-a greatly imsneak-

mlitv in thinking

'wrjting

such as
"must "-and" "inevitable"

ascertaining
every

is

tryth

su-

respect to pursuit
lead

to

erron-

Words

cannot

be

fa'ct

Gf

by

concept

cann^

be

the

^ru^b
as

-

•

^

.

an

awareness

state-

of

form

distinguished from

scientific

definition,

be obtained from a
p0r

£0urce

single

example,

mark . themselves>' as
non^cjentists. - - Those who - aip
Pemocryts, or Republicans, or
Liberals, or ■ Socialists similarly
remove themselves from the cateS°ry of scientists in economics.

^rXaS to the nature oi science

In
this
country,
particularly
since the emergence of the Roose-

science

,

velt New

Deal and

and of tbe scientist is

many

.

movement Mr
them occupy

the

jn

field

of

economics

,

It

be

a

is

the

scientist

to

confirm

; v:

.

-

.

pjnauy a study of the principles
spi-pnpp

should

make

clear the

methods of science that humanity

|mproves its state of well-being.

have

"

Walter G. Schallitz

pressed forward and have brushed

and

on

should

curacy

theories of the 1930s, a very large
have
a many pf
political

the meaning of
the ac-»
of Pearson's principal con-

treatises

the Keynes tentions.

positions appropriate for scientists
only. Cliques and political groups

subject to

until verified. But it i$
the opinion 0f this author that a
jQng and carefui search of the
auestion

...portion, of our. economists

-

seience

othervvise than unfortunate.'

^at

ad^ jpent

to

;

gbould

Ttiere

precise

involves

seience"

description.

nothing in
fact
what
is
not proved
and
alqicle may properly be acprovable. He may not have a ceptecj
as
anything more than
leader whose theories he accepts.; alleeations of this author; theif
Those
economists
who
have accuracy should be kept in the
classified themselves as followers area of qUesti0ning until verified;
of Marx, or Keynes, or Smith, or Th
mintPfi
ctotP1npnt
of
Kari

the

of

Since

that standard of behavior requires that the scientist
stand alone. He may not accept as

science
side,

answers,

nature

sin^e

,

.

alom.

-

,

herence

the results of the
widespread failure to understand
eous

,

stand

to

of the fundamental requireof
science
is , that
the

one

nature pf though
oiped

science

Because pursuit of correct methods

consideration.

;; 1 Marshall

quite clear to this

of methods which

and

would,, be

methods which lead to erroneoys

perior in

something else,

prevalent.

so

-^h^re-Wouid^

prophets publicize what they.
claim to see in the future, and

gradu-- scientist question everything,

unique in this country. It would
be educational in the only proper
sense of that term since pursuit pf

would

or

and

scientists, it seems reato suppose that such an

educational

that if the

fensible classifications which
"science"

of

the stq-

ated only

universities had had such
training
our cQllege and university
catalogs

of

methods

if it trained

people

colleges and

present

i

Our

con-

sponsibilities of science.

a

our

suppose

hardly

who

that

of

studied the nature and
to

in high

now
•

discussion,

the

fact

administrators of

subjective

this practice

principles of science. It also
reasonable

is

nonscientist?

It seems clear that

have

^nVdhoturnediir

though it had some value, is illustrated almost daily;: in our press

have

such

enter

science

Since all things lend themselves

or

not

may

because

sistently
error

sci¬

classifies

*

-

degree—upf
>»
rather _than .their alleged foresight is', pubhouI'd be confined to the limits
application of the methods of set- lished, hawked about,, and scruscience
The" commonly-used
cata¬ pnee, seems to be the dominant tinized as though this species of. wor(j;. «feer should disappear as
r„; pretense were worthy of serious a synonym for believe or observe
apart procedure.

unneces¬

scribing such fields as physics and
chemistry as "science" and of over¬
looking the fact that science is a
ence. The unity of all science con¬
matter of methodogy? Why is a
sists alone in its method, not in its
physicist called a scientist regard¬
material

far

values

private support

phenomena, every phase of social
life, every stage of past or present
development is

cedure

scientific

science

field

our

[National Defense ently generally, are
Act
of
1958]
will control
of
scientists,

Education

that minds converts all facts what¬
The

of

one

smother science and .education by

to

science.

history,

as

AlniYiV

"The bill

said

"Now this is the peculiarity of

fields

sucii

"

^

.

ties in which he is alleged to have

scientific method, that when once
it has become a habit of mind,
into

p.

president of

sary."

been

described well by Karl Pearson in
his classic, The Grammar of Sci¬

soever

in
t

,

15877, quoted a state¬
from a former outstanding

gust 13,

making

of science

nature of science lias

And

Congressional Record of Au¬

of nonscientific attitude.

f
widespread acceptance oi
unwarranted
pretense, - as

The

in,

According

survey."
The preceding is illustrative of
a pommon
practice in this coun¬
try of classifying certain material,
or fields
of activity, as "science"
despite the fact that science is a
question of method—the method
by which truth is obtained.

which,

offered as
valuable or
reuabie or interesting information

a

survey was

efeller Foundation provided $80,-

much'material

of

though

,

sion which exists as to the nature

000 to finance the

iication

'

is not
the1 confu¬

example of

are

answers

practice^of^forecasting
of whidi.fah^put-

by side the bounds of science. ..These
ob-. forecasters reveal that they, either

understand the meaning of
college or university. science or that they choose not to or opinion> may fall far short of
has no valid excuse for existence fulfill the responsibilities .pf ;.sci-. meeting
the.. requirements
of
except as it pursues the methods entists. Many, of,, our: .economic scjence, An editor trained in prinof scence in all the fields in which /forecasters step
far outside y the cipies 0f science should have no
courses
are
offered. This means limits, of science and' assert*; that * difficulty
in distinguishing
the
that all members of the facultyf .this or that will happen, as though writing of a scientist from that of
should understand what the meth- they can see into the future, denonscientist: >And* since
the,
ods of science are, should be sci-> spite the simple fact that no man
fitter,' by definition, utilizes a
entists,
and ■ should
trains their, livings today has ever lived to- methodology which does not prostudents to be scientists.;: -There, morrow or can see what fornortruth, a question arises as to
would appear to be ho logical.rea- row—jf, indeed, there is ytomor- wby nonscientific writing is pubson
for graduating any student row—may bring. Such people, who iisbed. There probably are many ,
from a college or university who. in
this respect ' are pretenders, answers, but a fundamental one
has not demonstrated that he is a seem not to understand that sci- WOuld seem to be that editors who
scientist in his method of an-^ ence is a description of past events utilize such> material either are;
alyzing problems and related data, and that it recognizes no law of unacquainted with the principles
These standards apparently arenecessity in the,recurrence of any pf seience or have chosen not to:
not-the ones generally followed observed regularity in a past se- adhere'-to-them..i:r
in our schools. Relatively few col— quence of events. Science deals
v
_
.. *
leges and universities even offer "with probabilities stated in ■' the Gains to be .had, from pursuit of
courses designed to acquaint stu]|ght of experience with recogni- *\- methods of science
'/r o¬
dents with the nature and impli- lion of, the fact that such .probajf
is
by utilizing the truths
cations of science and with their bilities, so calculated, may not be established V/by s scientists
i that
responsibilities as scientists.; Ap-; pjrqjected; into the future as cer- humanity ; progresses, to higher
parently few'-administrators and; tainjties. For this reason the words standards of living; and satisfacmembers of the faculties of1 co'l'v ^\yiU'/-.:and.^"must" • and I: "ineyi- tions.
•
leges and uniyefsities. haye;. hadr; table,"; often used by our non- ;
^o the extent that our-publicaa
course
or
: otherwise'.vbeen; scientific e c o n o m i c forecasters,
tions /.produce
the opinions pf;
trained in the principles' ofsci-; gnd others, fall outside the bounds scientists,
people are: put in a
ence.
'/■ " V./:■£''? °£> science.,, A .
position to profit from the truths
This author has- never seenja* tThe widespread lack pf under- produced by scientists; and truth,
college or university state that its5 standing pf -the. nature:, apd re- by scientific definition,.is obtained;
purpose is to train and graduate* quirements of science is also illus- jn no other manner.^;
:
scientists. The result is: that the? tjrated bj; a common practice of .:- The products of the work, pfcourses
offered and the training- searching and paying for the ser- scientists open the. way^to \acgiven in- our coUegeg ajtid unlv6r«^ vices of economists who make un- quaintance with correct; classi.fisities are in .higH.(degree|^qrrfof; scientific
forecasts. T 'ose who cation and definition—-foundationsthe most part, a hodgepodge*-im seek or pay for such forecasts ap- of scientific analysis.
^
/
which the subjective evaluations parently do not understand that ■ ;■ utilization of scientists in ecoof the instructor seem to he the they are being imposed upon by
nomics should be expected to put
controlling principle. Well estab-, people who pretend that they can rn end to such pretense as that
lished procedures in such fields as.) Sec into the future and are willing exhibited in our common economic'
chemistry, anatomy,
physics, l0 say that this or that will hap-'forecasts'and other manifestations

Kreighbaum report

unique

a

this country

in

phenomenon

thought

cent

.

.

*

"jTorty-one

;

;

materials

of

.

.

ciples

qualified
val of
science, he

gave

appro

,

expressed;

interviewed

persons

proval to the use of such methods;
that only 12 per cent said scien¬
tists were directly responsible for
the evil use of the facts and prin¬

v

of science.'
Five

sci¬

the Krieghbaum report is to
the effect that 83 per cent of the
ence,

opinion (the word "felt" was
used) that the world is better off
because there are people who pur¬
sue methods of investigation which
lead to the truth; that 5 per cent
of the others gave qualified ap¬

interviewed
felt

..

the

83

cent

per

.

of

terms

in

described

If

Under the caption

baum

differs from Pearson asof science.'
:

of science,

word

of the

'

publication of unA general :

contentions.

of
understanding =-/'-of the
nature and implications of science
has given rise to widespread pub-

wen or, most

i

-

is the method

correct

that

sume

said to mark themselves as nonscientists
.themselves to be followers of
the Democratic, Socialist or: Republican parties.
Inquires
why we generally term a physicist or a chemist a scientist,
regardless of how imperfect his methodology may be, while a
historian or economist who follows the methods of science is
not regarded as a scientist. Particularly singles out as responsible villains in all this many of our colleges and universities.
Marshall

or

much

as

widespread

sc\entij{c

tained, it seems reasonable to as-■ do not

common

Smith,

,

"...

on.

so

Since science

form in the

iii ...history,

science

economics,

practice of seeking and furnishing unscientific
forecasts in the field pf economics and lack of editorial
standards as evidenced in the widespread publication of such
material. Economists who are followers of Marx, or Keynes,
the

label of ieeopdmist-jneet • the 5requirements of the scientist. V.- •"

chemistry;^ science in nomics reveals itself in..a crude lack

in

science

and misuse of

outlining the general confusion as to
the word "science," a leading American
In

few men and women wearing the

find

to

chemistry,

Science in iWe United States

-

Financial Chronicle.

(1778)

Walter G. Schallitz, President

one

of

Security Adjustment Corporation,

....

a

difficult

scientist

in

undertaking to

economics;' and

.

Brooklyn, N. Y.> passed away^suddenly Oct. 26 at the age of 55.

Volume

Number

188

5790

.

The Commercial and Financial Chronicle

.

.

15

^

tive control is to be
employed, the

Taking Another Look at

the

disadvantages of such control need

pressures

possible. Jn the use of margin requirements to prevent excessive
% -

^-4.- ♦

•5 x^

<C.-CANBYBALl)ERSlX)N> >;'«• "

r

:ket,
are

<

Vice Chairman, Board of Governors, Federal Reserve System

//, "-y /:--v Washington, D. C.'

/'

for. antes,

the future may
tive

control

compel

years

TO

i

must
'

fwee?hath ihSbf•

ewrv

e^imw

For

Which you receive, a tax* levied,

8

an

e^ditrn'^nroneHv

-i'-.,"

'

;

v referred

i

to

gain

a

fionol

them with general

mnrvn+nmr

-

rpoillf

.

tho

tn

vaanc?ng/he
industryS

mighty

a

ex

__x

_-x.„^

ad

"

would

ecuuves

-

,...

*',»

.

?aarks.
/ question has beenpijt
mt,° vJrse.j!y the economist, Ken-

stock of real wealth—'

and

worKers .must

.rxix"ii. xiL---:1

nse

i

catjdiin

to

so

the.i:

.

is

among
cUUUllg

left

private

power,'''': 'w ;'

;.,

To

and

T alio- weSSvehad ?nTri?cf and^m! ^

individual

turn

am

convinced that

its
'''.'

, ..P ,

I

fruits

■

...»

,

Ec

>

extremely

.

p

,.

„

:

fc

*

we

sound, II1
flexible monetary policy. •
New Loewi Branch
'
' Reh?nce on general credit meaSWAUWATOSA, Wis.—Loewi &
dres
course, has limita-; Co., Incorporated, has opened
a

UlUlVIUUdl .a
a

rnmnoHtinn

tn

much

^

borrowers

SOUnU,
„

"I,Ii'
and

.

•

...

alrae°of

' private lenders, even though the tions' Desnitf, the manifest
tions DesPite
rf»cr»nr>«ihiiifxr fnv,
tho

Accentuated the Cycle

'

-

are could not have done even this well'
P"?e-The ■« we had not clung tenaciously to •

go>»g

nave;apportlonment
ctp^JUI lIUXllllClTb
.

...

■ ■

the Financial

System
'
.<
Are quite impressive, once
you list 'em, !
1
Although the system has the

sour A

marketplace to those ployment. I

Pax

xV

-

^*c£1l!^7h(SrttaiSSSto
accomplish
growth

regretted.that the 1955 market Was-hnriWer*
oversold by at least a million ears.,
oversold by;at least a million ears.. bchveen,

permit-

ted Americans

eventually

Apd
to the question
Posed at the beginning of my re-,

.

,

dotvh^fot-dwhilJ AStomobUeM^'.eredit-woWhy borrowers who
to

'

have

be gained by consumer-credit reg-

:

vom'rtnv,ir.n

crease they imply, both in credit

-totdl, leaving its alloca-

ehfree i
t^n tk maSet^ Credit

force

and

'

irt

citizens

time when credit demand

When' one contemplates these *eth Bouldmg:
banks so that bank credit magnitudes and the rates of in- < The Fruits of

^a^co^ract *and expand flexibly

Vl^tfb tie?! extenSSitsSfmid to°have sloped

credit

consumer spending were on the
increase, i In that1 case,* society
bright decide that the benefits to

the ?e™ availabla to the c°m"*

rtg

auiabies.

sumer

general

—jld
result of . the need to reorganize illation would outweigh the"diffithe diffland reequip the defense establish- culties. If so, we should benefit
ment in view of dhe rapid techni- • from the experience during prior
cal advances which have taken periods of regulation so as to min-,

automobiles, factories, and

vance

.a

many, TreasurP. General

an^^dy,^mi^,.mercial

market

of

Su ^n Ihe'Cong^^"^^:. fernatlonaiTensionV'AtffiJhe ^ administrative dilficulties"

chain of events;

antl^Xt^m

it accelerato

as

degree

consumer

oUr

technical

creased

have added $20 bil- " restraint. * Such feeling niight

we

to finance additions to plant and
equipment. We have also added
to the Federal debt, largely as a

perspective of

proper

compare

-xi.

of

demand for consumer-credit coil—
as an alternative to enhanced
cyclical fluctuations or to an ■■fti-

trols

.

h;
Consumer credit mav nroDeilv be
may properly be
•

been

monetary con-, time State and local governments'
^persons to question ^ entyrusted by the Congyss to have borrowed $30 billion to fi.
whether the obvious gaiiis from ^
Federal Reserve System, has nance schools and highways and
the use -of consumer credit are.;the particulai. role 0{ regu*ting for other purposes. • *

••

.The age-old problem of how to
have roses without thorns;is well

/

4%*The

almost

'HEvedy thin.f„has two sides, that folloVed-has caused
good and
evil.
thoughtful

have

the

be
instalment credit" generated; for
example if terms
outstanding, $90 billion to mort- : \vere once more eased radically at

financial, lion to

" Ih the seconri half of that vear 'flsfal and monetary policy. Fiscal
"Everv'*'p tCy- a s throuSh governmental
e^^ 'shabdW«b^^a?^thetSktf -surpluses or deficits. which reflect
benefit iridustVilr^OTSimts a^buntih" t6; bo
governmental spending and

ttel

fluctuations

greatly moderated in

Compensation

on

observed

goai

economic
,

the role of selective controls, one;

.

essav

in the future might call for a re-consideration of that view. They
might create a widespread public

^institutions to whom the regulation
^applied breathed a sigh of gage debt, and $85 billion to cor% relief when the. ordeal was over, ^orate debt—in considerable part

'

his

regulate consumer
the administra-

•

praises consumers1 debt-handling ability but considers, also,
the thornier cyclical aspect involved in accentuated peaks.
In

use of
general
supplemented by
stock market margin regulations,

^^enforcement and Since 1950

.

•

Emereon

sible, however, that developments

the

Credit measures,

In three pre-

the 200,000 retailers and

>

The Reserve official

ago;

trols+of consumer Credit-were not
called for at that time. It is pos-

..

Through

<:

*

f

'

credit field almost two years ago
and concluded that selective con-

even-

period
that since 1950> despite a sharp increase
J the Federal Reserve
System, which in both public and private debt,

;

reconsideration of hands-off qualita¬

policy of two

w.

«.

enforcement

ht>wever,

r

a

loose

WGre sogreat

:

Regarding liberalization ol credit terms
and homes* and states detrimental developments in

i

not too difficult.

credit,

reviews the 1#55 record

break

Praises Accomplishments

credit into the stock friarsupervision and

viqus efforts to

.

Warning that further relaxation of auto and mortgage credit may
bring about selective consumer credit controls, Mr. Balderston

controls, inflationary

will

to be faced lip to and removed" if tually.

t

.

•7:

general

neces-: brartch officer the Mayfair Shopcredit. ping Center, ± Central IVACHJ., under
i\,^xr 1
Mall, uiiuicjx
ship of homes, small factor in inducing: subse- - J
'
»Policy> and despite the manifest the management of T. O. Malmautos, bathtubs and television that quent management decisions that •1 ■
......
•' -.."advantages of permitting the mar- stone, Jr.
•
they have now achieved. But con- were not altogether prudent.' In r In contrast to this relatively im- • ket to carry out the function of:
"7
suiner credit enabled them to
get 1956 businessmen expanded their, personal allocation of the money credit allocation, conditions may
these things sooner'than other- outlays for* plant and
With Eastman Dillon
equipment- supply are so-called selective or at times develop in specific areas
C. Canby Balderston

wi d

e

;; This '-consumer

owner-

boom,

no
iiu

Wc*&'
was

uuuiii.

...

fntQl

cnnnlv

nf

sity
^

joroHit

for

sound
^

a

general

.*•

.

,

riw/v

VOO/lir

'.^4

+U„v,

+Urt

.

•/>r»n+v*r»r<?

t

fehno/lltr

enoulzincf

'

tVint

-

propriate to the situation.

to equip it rather than to wait in- the cost'of
building materials and If any of these ismsed, government
definitely.' Even those who are labor higher and higher. This up-; intervenes in the operation, of the
critical bf the gadgets that ; sur->ward movement led some manu- - free market. Of course it also inround

must admit

us

that

tounding proportion of

an

were

pacity,

skeptical of the consumers'
ability to handle debt must recog-

higher.

they : had better get it shelter particular groups of eitipromptly before costs rose still "Zens.'It is clear that even if these

were

nize

that

the-record

remark-

,

the

,

:

:f
-

Reviews

1955

'/-:

a

result,

of them ^supplementary

many

last

half

dustribs

-

Credit

of

became

1957,
aware

»•

,

j

associated

Carl|sje

Under

pa<

iiatmiLCB,

-jjjggtreet

controls

to

jjuu-ixL.

supplement

general
£

ones.

office
a

Liberalization Record

Most" tragic

•

.

of all

.

«

from

Which

.

associated

y

.

Pennsylvania

with

ence

of

are

emerging, in
part a consumer-durable-goods recession, reminds us of the influboom

consumer

the

year

credit

consumer

of

1955/

outstanding

instalment

credit

in

that

volume

increased

offer to sell or a solicitation of an offer to buy these securities.
offering is made only by 'the Prospectus.

an

durables

consumer

,000,000

ers' holiday. There developed an
over-supply of stoves, refrigera-

of

$5%

the

i

Texas Electric Service

-

billion

in-

tors, washing machines, radios and

accompanied by a significant: easing in the terms on

Company

televisibh sets.'Production sched-

almost

or

25%.

This

'crease was

which

credit

consumer

tended, particularly credit to
'chase

ules were cut back and men/were
ex-'dsid off/* The construction boom

was

languished and here again;
men were laid off. And so, in 1957

-also

pur-

automobiles.

new

First Mortgage

;

•

-

Darvd November 1,

By midinstalment con-■ and

1958,; society paid in unemtracts on new automobiles were ploy merit, !ilost
salaries and r lost
typical as against 24 months the .profits'Ihe price of another bust
/year before, and
contracts with that followed in the wake of a
36-month maturities were becom-; boom which we must, in all hon¬
ing common. At that time, the* esty, recognize was helped on its
1955,

30-month-

Bonds, AVi% Series due 1988
Due November

1958

1, 1988

'

Price 101.656% and accrued interest

.

-

-

down-payments

:

standard

of

one-;

third of the transaction price was
still being adhered to, but over-

allowances

on

trade-ins

were

-

low-

'

ering the effective down payment
the buyer's equity. With this
impetus, 7.4 million new cars were
in

the

increase
over

of

1954.

of terms

credit
-

to

more

The

was

struction

domestic

market,

than

sumer

;

over

The

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

such

con-

credit/in addition to

gen-

one-third? eral. fiscal

evident in the

control

,

"

.

have "selective

liberalization' The

same

' / * /
®°cial Desirability

This poses the question as to
whether it is socially desirable to

an

and

decision

monetary
must

control,

represent

HALSEY, STUART A CO. INC.

a

of

value judgment based upon a bal-

expand residential

con-

ancing of gains against disadvan-

at

rate,

tages.

an

use

accelerated

You

will

new

housing starts reached 1.329

remember

that

in

1955

consumer credit has
appeal to those who feel
that, despite its benefits, excessive

,,

tnheaNervT8York

„

State

ciation, New York City,

fluctuations in its

use

should be

Banker^AssoI- Prevented in Order to minimize

Oct. 23,




1958.

BACON, WHIPPLE &. CO.

COURTS&CO.

&

CO., INC.

THE MILWAUKEE COMPANY

strong
•

.,

WM. E. POLLOCK

BAXTER L COMPANY

To diminish the unstabiliz-

ing effects of

million.

fore

way;

7^

and

sold

by the 1 excessively .: rapid ;
£rowth of consumer credit.
'
*

economic instability.

But if selec-

STERN BROTHERS A CO.
October 29, 1958

Fii*$t

Fd*st

Banking & Trust
The Federal Reserve System Company of Philadelphia in the
made a study of the consumer-, commercial \ credit department.
_•

thousands of miles, and becoming
disenchantedn with the' increased,
prices, consumers went on a buy-

the

In

obtained

the

with^ the

that they needed.most, having au-^
tomobilbs that were still good for

we

repre-

Frior to joining Eastman Dillon,
Securities & Co:, Mi*. Bibi
associated

The

.

West

Union

Tifav Rp

This announcement is not

the un-j

was

employment that resulted. Having ;

their

100

registered

many in-:
of excess/

Like most roses, consumer credit
also has its thorns. The recession:

with

'

capacity.

-

-

llistlfv

such circumstances, public opinion sen+a+jve
ggjj^tive
mav come to
*
may fOme to insist UDOn selective r, 7
upon
f

controls are help-:

discounted the growth in demand ,f up in meeting emergencies, they.
for their product for years ahead. *:are no substitute for general fiscal?
When.the awakening came during and monetary controls.
Without

financial

has' been

responsibility
ably good. /

of

.

As

Tl'POh1f> Wfilllfl

be absorbing,too much of. the
total credit expdhsion that is ap-

to believe that if they ^tervenes when vit uses subsidies,
||
going to need expanded ca- l price supports, onrl guarantees tn
and cfnaranthPfi to

have : the physical basis for
h pleasanter life.» And those who

now

fifimp

may

facturers

as-

Americans

tn

MULLANEY, WELLS A COMPANY

THOMAS A COMPANY

The Commercial and Financial Chronicle

16

selves
of, the
governmentguaranteed loan program.
In
the
merger
candidate
field, the ICC member specif¬
ically mentioned the four

THE MARKET... AND YOU
STREETE

By WALLACE

Western

roads,

Great

Pacific;

Two

Reindel, and OhI, of New York City,

Northern;

Following a period of de- for in order to narrow the
lasting for six consecu- spread between the bank bortive
days,' the market re- rowing rate and the yield on
bounded sharply on Tuesday Treasury bills.. H o w e v e r, possible Pennsylvania-Central
and
Coast
Line-Seaboard
and Wednesday of this week there's no gain saying the fact
blends. "v.. :
and succeeded in recouping a that the Board is more than
f./
' ^
" if ' " if
■
substantial
portion of the slightly disturbed at what is
earlier losses.
The uptrend termed
the "inflation psyPacing the Uptrend
was
particularly marked on chology" pervading the acAmong the issues that con¬
Wednesday and produced a tivity in the stock market.
tinue
to
maintain
upward
5.84 point gain in the Dow-.
;
*
$
*
momentum, and in complete
Jones Industrial Average. .At
Thfe
atlUude
was ■ again disregard of the action of the
the closing level o. 542.72, the
jjnl^liely aired by still another list in general, is American
mdex was but 3 64 points bespokesman namely, J. L. Motors. An important factor
low the all-time high recorded
Uobertson who after stating in its good performance could
on Oct. 17.
that while
there
are
good be attributed to substantial
*
*
reasons "to think that profits short
covering. Although
Last week's slight sell-off,
are rising rapidly,"
went on there is still a rather large
incidentally, came in the to strongly imply that the short interest in the issue, the
wake of a complete absence
greater activity and rising total amount was markedly
of an y -untoward • developstock prices were purely a reduced in the month ended
'

merits either

trend

or in

the business

in

to

the world

political

inevitable

of

tance

situation. As a matter of fact,

infla- ment, the fact is that the com¬

thinking he added, pany, based on its output this
many of the third quarter re- jg
completely unjustified and year, as compared with 1957,
ports of the nation s leading suggested that its continued is doing extremely well in the
companies; a c t u a 11 y were acceptance in Ihe area of busi- area of earnings.-

bullish.
there

This

lion

in tone.

were

That.is_ to

achieved^ by

diverse

say, gains may we add the warning

fields, rather than
possibie controls
being concentrated m specific credit

in

cent

of
companies vici-Chairman Balderston of

can

Industries.
Inflation and the Reserve

The

action of

Rails Bufant

.,

Board

.

,

While

no one

Studebaker-Packard. Percent-

believes that

age-wise, issues in this cate¬
gory have chalked up gains

the woes of the railroad in-

the Federal

dustry are now. a matter 01
the history, the latest earnings far in excess of those achieved
discount fate from
2% to reports from some of the by the higher-priced "blue
2^% was not viewed as be- carriers are none-the-less chips."
t,

-

~

Reserve Board

.

.

.

m

.

uppmg

ing portentous either in the extremely encouraging. Furstock
*

or

The

Jhermore, should the rate of

-markets. A

money

meteoric

rise

the

of

low-priced issues during the

improvement achieved to date current year, for example, is
ange obviously was called as
compared with a year ago
,

.

,

„

,

obtain

the
DIRECTORY

New

r

practice,
the
three subsequent
1958, will be meetings will also be devoted to
Victor R. Hansen, the Assistant fostering serious discussion
of
Attorney General of the United economic problems of common in¬
States in charge of the Antitrust terest to academic and practicing
and
other
qualified
Division
in
the
Department of economists
Justice, and prominent attorney, persons in the far-ranging Metro¬
Jerrold
G. Van
Cise of Cahill, politan New York region. This is
Gordon, Reindel, and Ohl, New done by inviting distinguished ex¬
York City, who has written and perts in their fields to bring chal¬
practiced widely in this field. The lenging realities and insight to

4k

MID-YEAR 195S EDITION
JUST OFF THE-PRESS V

•

-

book'" containing
9,500
covering all United' States and
page

Canadian

cities.'
Listings are arranged
geographically^. and alphabetically, and
are
comprehensively detailed:
under which business is
and date established

name

ducted

BtSck "Exchange

Standard

illustrated

&

Poor's

in

index

this

ers.

in

con¬

score

is evidenced in

53.86

berships (including

"possible"
than"

a

Mera-V

Association

N.A.s.D.y

„

Some of these have been
the

more
and

on

Oct. 22. In the

of

Names
of

Character

Securities
of

of

Business

Handled

stage

-

for

year/ without

smattering of

even a

Partners

Department

or

&

Class

•V'ard

progress

Officers.

Heads -V

some

government and private antitrust economists who are anxious to
will present their dif¬ question and improve their own
fering views for the edification knowledge and understanding of
of
economists who
often judge the subject—economics;
attorneys

-

Early Warning Indicator Hoped For in
Capital-Output
Newly perfected technique to determine extent of overcapacity

as

those

firms

located

te *

another valuable^ feature,

Bound in Durable

limp fabrikoid

—

of

•

TODAY

HERBERT D. SEIBERT I CO.
New York 7, N. Y.
REctor 2-9570




given the-"green light".

just recently by Kenneth' H.
Tuggle, member of the Inter¬

-

$14

were

BOSTON,
Chew

-

is

Mass.

now

—

Philip

lead business cycle indicator.

uncover a

Eleven Had Excess

approach to the problem
determining the extent of over¬

Through

capacity in manufacturing at the

connected

with

Schirmer, Atherton & Co., 50 Con-,
gress Street, members of the New

tal-output ratio, The

He

was

ham

&

formerly with Harris, UpCo.

The

Conference

Board

cess

duration of recession

tent and

industries

individual

Campbell, Jr: is

the further fact that the

&

matter

Stone & Webster Adds

'

1957.

had

not

availed

car¬

them¬

BOSTON, Mass.

Webster

—

chinery; fabricated metal products; chemicals and allied prod¬
ucts;
tobacco products;
rubber
products; lumber and its products;
printing and publishing;
stone,
clay and glass products; "primary
metals; and machinery) excluding

'

pansion and contributes impor¬
tantly to a business contraction.
of

Despite the crucial importance
the relationship of peak de¬

electrical.

capacity to produce, there
surprisingly little firm statis¬
tical evidence that bears on it,

mand to

The

is

excess

erages;

deficiency does not stem from the

Capital-Output Ratio
The

studied

approach

NICB is based

..._

by

„

leather

porta tion
equipment, excluding
motor vehicles; instruments; pe¬
troleum and coal-products; furniture and fixtures; and paper and

If

relationship

,

A

..

ratios

the

above

Securities

dence

Federal Street.

exploratory

results

are

notes, the

new ap¬

judging the probable severity of
It will also be use¬

forecasting the duration of
the slump, for recovery is condi¬
tioned in large part by the extent
of excess capacity at the peak of
ful in

*

business.

v

",

/

';

With Rodman & Renshaw
(Special to The Financial
-

Chronicle) j

111.— William
C.
Douglas* is now with Rodman &
Renshaw, 209 South La Salle St.
CHICAGO,

-

of

excess

capacity—unless

Joins Walter Hood

.

technological changes in the in¬
terval required more capital per

1948

49

/

..

„

bench-mark ratios would be evi¬

i

Conference

as

Board

'

chose

(Special to The Financial

Chronicle)

High Street.

the bench-mark year be¬

of manufacturing

Laidlaw Adds to Staff

no

excess

capacity.

(Special to The Financial

were

operating at peak output with vir¬
tually

'

PORTLAND, Maine — Douglass
G. Starrett has become affiliated
with Walter J. Hood Co., Inc., 142

independent evidence sug¬

with Stone branches
Corp.,

the

the downturn.

significant rise in the

capital-output

.

approximately correct/ The Con¬
ference Board

by the value which manu¬
facturing enterpriser place on
these assets in their balance

capacity was virtually fully

,

t

proach to measuring excess capacity will provide early in a re¬
cession
some
critical
data for

ured

when

including bev¬
textile-mill products;
its products; trans-

and

Early Warning System Hoped For

analysis of the

on

include: food and

1957

allied products.

.

the

of capital to output.
Capital, : in this context, means
fixed capital, such as structures
and equipment.
The volume of
structures and equipment is meas¬

without

subgroups

eight
in

kindred products,

The

The Conference Board notes.

Marshall F. gests that at that time almost all

now

motor , vehicles
electrical ma-

They are:
equipment;

and

be

possible if it could be established
that excess capacity emerges in
the latter stages of a business ex¬

cause

(Special to The Financial Chronicle)

all

of

62%

"

unit of output.

of
fact, Mr.
seemingly deplored
the fact that
nothing has been
accomplished thus far, and
a.

about

capital reported by manu¬
facturing enterprises at the end of

fixed

in

might

for

accounted

under¬

analysis in the belief that
intelligent forecasting of the ex¬

took the

The

Tuggle

Conference

concludes that in 1957 ex¬

Board

-

York and Boston Stock Exchanges..

Capacity in '57

of the fixed capi¬

use

capacity existed in eleven of
trial Conference Board, according 'nineteen manufacturing sub¬
to a Oct. 28th report.
groups.
These eleven industries

utilized.

E.

state Commerce Commission.

riers

hopes it will

new

try

(Special to The Financial Chronicle)

consolidations, by the
way (or at least those consist¬
ent with "the
public interest")

As
YOUR ORDER

25 Park Place

/
A

classifications for a bench¬
mark year which independent evi¬
dence
indicates, was
a. period

of the author only.]

With Schirmer, Atherton

.

Rail

Numbers

ALPHABETICAL ROSTER of all

mowing city in which ■they

ENTER

by the Conference. Board shows that in 1957 11 oat of 19
manufacturing industries possessed excess capacity. The Board

-

sheets, corrected for price
*
<
*•'
[The views expressed in this changes.
article do not necessarily at any
The procedure employed is to
time coincide with those of the establish a fixed
capital-output
"Chronicle" They are presented ratio for each of the broad indus¬

Names
—

Systems—Teletype

eventual Union,

•••

Correspondents—Clearance Arrangements;
An

an

-

Phone Numbers—Private
Phone Connec¬
tions—Wire

31,

<

same

eDtetri«dNSer°clnding p<>st omce thus far (»t least publicly) toGeneral

Oct.

evening,

*

analysts, in light; of the
Another factor here, of record and the history of past
course, concerns the feeling bull markets, are inclined to
that something concrete may express some misgiving as to
develop from the long-stand¬ the outlook for the market as
ing reports of projected merg¬ a whole.

r

York tomorrow

sociation of New

inability to measure peak
de¬
the final readings
covering 23 issues. While the
f
quite impressive.- component stood at 34.55 in mands, but from the inability to
devise broadly based measures of
market is optimistic January, it had advanced to capacity output.

.Jheir industrial j counterparts.

1,700

graphically

of

the , carrier, period ;< the company's 500equities have performed stock
average rose from 40.99
much
better
recently than to 51.07. Small wonder that

.

Firm

remainder

Fourth Avenue,
As is the usual

315
City.

Auditorium,
York

Rand

Remington

in .the

place

area.
::
..<•./
Appearing before the members
Metropolitan Economic As¬

be

That the
on

the

meetings in the 1957-58 year of
the Association which will take

anti¬

in- the

place

decisions.

of four annual

This is the first

trust

x,the..>fa„ct, that,

■B

listings

year,

should

Of

CTfiftr ml Dflllll liAHerC
vf UIhI ilw IHIIIII tluUoLa

A

for

taking

monopolization on
than that which

or

other

grounds

form the basis for court

the country's

past. Aside from Ameri¬ peak of general business has been
Motors, the list includes explored by the National Indus¬

Alleghany Corporation; Avco
Manufacturing; Curtis Pub¬
lishing; United Industrial
Corporation; Artloom, and

on consumer

of

two

from

of the

J1ess

1957, the breadth of the lm- wjll and can stop inflation "in tivity and price appreciation
provement recorded was sig- its tracks." To the foregoing, are concerned
during the re¬
nificant.

monopoly

econo¬

top ranking legal experts some of
the latest thinking and occurrences

As a matter of record, the
and investment decisions
Whfle
ytere exceptions js potentiallv dangerous to its so-called low-priced stocks
to the growing trend of much
adherents. fhe Board, he con- clearly have been in the van¬
higher earnuigs this year vs. tinued; has the powers, and guard insofar as trading ac¬

Tim-m

academic

and

Business

now

>

Metropolitan Economic Association of New York, this Friday
evening, October 31, in New York City. - •

mists will have an opportunity to
learn

Gordon,

to present their views

are

Aside from this ele¬

Oct. 15.

the gr0wing ac-

symtom of

Government's Antitrust

R. Hanson, in charge of the

Victor

Chicago, Burlington and
Quincy, and the
Spokane,
Portland and Seattle; also the

cline

Top Antitrust Legal Experts to Address
Metropolitan Economists

Division, and attorney Jerrold G. Van Cise of Cahill,

Northern

1958

Thursday, October 30,

.

.

.

(1780)

-

BOSTON, Mass.
Dionne

is

now

Laidlaw & Co., 80

—

Chronicle)

Edward A.

with.
Federal Street.

affiliated

Volume

188

Number 5790

.

.

The Commercial and Financial Chronicle

.

(1781)

Alexander

17

Yearley, IV, Chairman of NASD
From

WASHINGTON, D. C.—Alexander Yearley, IV, Atlanta, has
been nominated Chairman of the Board of Governors of the Na¬
tional Association of Securities

Dealers,

organization of
Nomination is tantamount to

brokers and dealers in the country.

Washington

largest

Ahead

at

C.C.R.Y.

of the News

A

effort

an

win

to

the

Negro

Today

the issue of irre¬
deemable currency versus a gold
standard and a redeemable cur¬

By CARLISLE BARGERON
In

debate

will be held today at the

rency

History is replete with instances

on

Baruch

School

of

vote, Paul Butler, the Democratic

of

National Committee

Chairman, is

given

that

City. Up¬
holding the latter will be Dr. Wal¬
ter E. Spahr, Executive Vice-Pres¬
cause
they had lost / the home
touch. In my opinion, if there is ident of the Economists' National
a
recurrence
of
1957
when the Committee on Monetary Policy,
Southerners compromised on the New York City. .A leading mone¬

to

saying

if

the

Southern
Democrats
d

n't

o

scribe

sub¬

to

the

who

men

a

S up r e m e

now

be¬

desegrega¬
tion they can

leave

South.

tary and banking scholar, he has

rightsi fight only to realize
they had been doublecrossed, there will be some re¬
placements in Congress from the

ruling

on

the

party, that the

written and spoken

that

widely on the
Spahr heads a na¬
tional group of money and bank¬
ing economists which has, since
our departure from the
gold stand¬
subject.

'•M

Ic is true that there is

party really

no

Business, City

College of New York

civil

Court's

and

national figures and who all
sudden were defeated—be¬

came

of

here

came

more

in

ard

Dr.

1933, not been fully cred¬
appreciated for serving as

does not need

similarity between the Northern
and Middle Western Democrats on

ited

them.

the

the country's "watch

As

things

stand

It is

gentleman is

it
Carlisle

badly mis¬
taken. His

without

Allen

Wallace H. Fuuon

Yearley is

Vice-President

for

one

partner of Robinson, Humphrey & Co.
its corporate affiliate.
He will succeed

of

Yearley will take office in January and serve as Chairman
year. He is presently serving a three-year term as a mem¬

ber of the
NASD

board.

that

This is the second time since

Atlanta

an

dealer

has

been

formation of the

chosen

for

the

post*

Clement A. Evans, President of Clement A. Evans
& Co., Inc., was
Chairman of the association in 1949.
Mr.

Yearley is a former President of the Georgia Security
Association, Chairman of the Southern Group, Investment

Dealers

Bankers Association of America.

Others

selected

for

their duties in

assume

Truman

South

in

his

won

cele-

Butler

the

>

in

have

their

Humphrey and
long been in¬

attitude

Southerners.

But

national

recently

Debentures Offered
International

$50,000,000

Harvester

Credit

Corp. 4%%

offices,

who

also

will

1979,

(Oct.

29)

that

suppose

could become

in the thickly
States

the

Democrats

was

of investment firms headed

tions.

Total indebtedness of the Credit

corporation at Aug. 31, 1958, was
$286,438,500. This total included:

jointly by Morgan Stanley & Co., short-term
notes
amounting
to
Glore, Forgan & Co., and William $241,438,500, long-term senior debt
Blair & Co.
of $20,000,000 ,and
subordinated
The
owned

corporation, a- whollysubsidiary of International

Harvester

Co.,

will

add

the

net

well established

so

populated industrial

Illinois, Pennsylvania,
New
York, New Jersey, etc.—
that they
would not need the

Committee, and

South but that is not the situation
now.

the North and Middle West,

being

contests

no
n0

the

in

that

he

was

fed

up

on

National

leaving the
And if it is left to

and House there will not be

happening in the

initially

short-term

of

ings.

the

to

borrow¬
"

...

The

debentures

will

be

non-

redeemable prior to Nov. 1, 1963.
On
and after
Nov.
1, 1963, the
debentures will be redeemable at

and

104%

deemed
1964

accrued

on

and

or

interest

prior

thereafter

to

at

if

re¬

Oct.

31,

prices de¬

creasing to the principal amount
and after Nov. 1, 1976.

on

The Credit
wholesale

corporation finances

and

retail

sales

of

ternational Harvester Co.
distributors

in

In¬

and

United

States.

company
motor

and

is

a

trucks,

dealers

The

its
the

Harvester

leading maker
various
lines

of

stock

of

the

corporation is owned by
International Harvester Co.

July 31,

1958,

amounted

at

to $55,-

891,875.

ing equipment and

power

mov¬

units.

near

This is not

—

Theodore

O. L»ydecker has become associ¬
ated with Grant, Fontaine &
300

21st

has

recently

Street.

Co.,
Leydecker

Mr..

been

with

Earl

A.

Holtham.

In the past he was an
officer of Stephenson, Leydecker

offering of these debentures for sate or an offer to buy, or a solicitation of
buy, any of such debentures. The offering is made only by the prospectus.

an

to

hold

the

present

For the nine months ended

July
31, 1958, receivables acquired by
the
Credit
corporation
totaled

$420,529,000, compared with $437,336,000 in the corresponding pe¬
riod of 1957 and $631,338,000 for
the 1957 fiscal year ended Oct. 31.

It

is

this

for

reason

that

cor¬

poration for the nine months ended
July 31,
1958, was $23,877,127,
compared with $21,262,339 for the
same period in 1957.
Net income
after taxes for the respective
pe¬
riods
For

was

the

come

$4,439,076 and $3,510,867.

1957 fiscal

year

$29,455,080
income $4,955,601.
was

total in¬
and

net

With

Thomson, McKinnon

(Special to The Financial Chronicle)

nationally. If it doesn't they
their
chairmanships. They

lose

$30,000,000

Middle

and

brethern

in

order

to

unity. At the
they compromised on
party

which

bill

Company

43A% Sinking Fund Debentures
Dated November 1, 1958

Due November

1,1983

Price 99% and accrued interest

Copies of the prospectus may be obtained from any of the several under¬
writers only in stales in which such underwriters org
qualified to act as
dealers in securities and in which the prospectus may legally be distributed.

to

The First Boston

Goldman, Sachs & Co.

last session
civil rights
of

Kidder, Peabody & Co.

Lehman Brothers

White, Weld & Co.

bert

these

as

Senator

Hu¬

Humphrey don't realize that
men are not reflecting the
feeling of the rank and
In every

of the South.

in the South there are

who would like to

They

State

politicians

come

Stone & Webster Secnrities Corporation

Bear, Stearns & Co.

care

interest in them.

So

if

they get the feeling that
representatives are not ag¬

matters like
of the most
prominent heads up here in Con¬
gress from the South will fall.

enough

rights,

;

Moseley & Co.

Carl M. Loeb, Rhoades & Cow

R. W. Pressprich & Co.

Salomon Bros. & Ilutxler

A. C. Ailyn and Company

G. Becker & Co.

•"

Dean Witter & Co.

American Securities Corporation

Incorporated

Baker, Weeks & Co.
Francis I. duPont & Co.

Bache & Co.

Alex. Brown & Sons

Hallgarten & Co.

L. F. Rothschild & Co.

McDonnell & Co.

Shearson, Hammill & Co.

Robert W. Baird & Co.,

Bacon, Whipple & Co.

Blunt Ellis & Simmons

Courts & Co.

Incorporated

First of Michigan Corporation

First Southwest

Company

II. Hentz & Co.

Hayden, Miller & Co.

Fulton Reid & Co., Inc.'

The Illinois

Company

Incorporated

McCormick & Co.

McDonald & Company
The

Newhard, Cook & Co.
Schwabacber & Co.
J. Barth & Co.

Murch & Co., Inc.

Prescott, Shepard & Co., Inc.
October 29, 1958.

,

Merrill, Turben & Co., Inc.

Robinson-Humphrey Company, Inc.

William R. Staats & Co.

Bosworth, Sullivan & Company, Inc.

Wm. J. Mericka & Co., Inc.

on

some

Paine, Webber, Jackson & Curtis

to Wash¬

nothing about
the committee chairmanships be¬
cause it would be a long time be¬
fore they worked up to one. The
people as a whole certainly have

their

hazard Freres & Cow

Incorporated

diehard

ington.

F. S.

are

such

Corporation

Ripley & Co.

Merrill Lynch, Pierce, Fenner & Smith

Smith, Barney & Co.

their

what

some

having one.

Westerners

Harriman

Incorporated

Hornblower & Weeks

happening.

to avoid

no

Glore, Forgan & Co.

a

in this mood at
present and will be, so far as one
can tell.
They don't want a third
party, and apparently are willing
to go a long way and take a lot

file

Blyth & Co., Inc.
Eastman Dillon, Union Securities & Co.

Western
preserve

wonder just

caused

Now, they

Hill, Darlington & Co.

Building.

McKinnon, Security
He was formerly with

The Glidden

t

cated

&

offat

the

But the Northerners and Middle

Total income of the Credit

an

committee

Southerners want to see the party
Win

civil




OAKLAND, Calif.

the Senate side.

gressive

throughout the country; its

With Grant, Fontaine

& Co.

the Senate.

Thomson

farm

member of the

such

Arkansan, Wilbur Mills, is
Chairman of the powerful House
Ways and Means Committee; a
Virginian, Senator Harry F. Byrd,
is Chairman of its counterpart on

equipment is sold to approximate¬
ly 4,800 independent dealers lo¬

Harvester's

duly

took note.

future.

because that at

men

MIAMI, Fla. — Raymond F.
Briggs has become associated with

International

a

faculty.

An

was

farm

tractors, earth and material

these

is

constituents

of

machinery and construction
equipment,
including
crawler

This

Eastern

outstanding

Credit

the

applied

Butler's

Chairman

Sethur, Associate Professor

(Special to The Financial Chronicle)

there

South.

statements, and the voluble Demo¬

likelihood

any

of any southern State
fold this year.

the

Total capital stock and surplus

be

is

Senator Smathers made it known

cratic

Neither is there

take considerable abuse from their

funds to be available for the pur¬
chase of receivables. The proceeds
reduction

such

as

—

indebtedness of $25,000,000. All of

proceeds of the sale to its general

may

redeem¬

a

gold standard will be Fred¬

erick

in charge of electing Democrats in

has come about through the
practice of the South in reelecting
their men until they have come to
motor
trucks are sold
to 5,100
have long periods of service; and,
dealers, a majority of which are
under the seniority system, they
Harvester farm equipment dealers
are
the ones in high places to
as
well, and construction equip¬
whom everybody else has to kow¬
ment is
sold to more
than
100
tow.
Sam Rayburn is speaker of
distributors. In addition, Interna¬
the House, for example; another
tional has retail outlets for farm
Texan, Lyndon Johnson, is the
equipment in about 100 cities,
leader of

at

resents the first public financing
by the Credit corporation, was
underwritten by a nationwide
group

:

return to

paig'n

a

debentures, series A
made yesterday
some
of which also retail motor
99Mj% and accrued
trucks,
and
retail
outlets
for
interest, to yield about 4.66% to
trucks at about 170 other loca¬
maturity. The offering, which rep¬
due *

able

a

*• Democratic Senatorial Cam-

I

lost

no

tion

of

Opposing

Louisiana.'^'e^arded'thT^est "of

He.

did

He

ton, director.

offering

price of gold.

towards

C.C.N.Y.

thing.

1948.

leaderships. These take with them
patronage and power. The situa¬

Int. Harvester Credit

re¬

fully redeemable gold

the southern leaders in the Senate

NASD

January, are:

Washing¬

Public

a

strangely enough, is Chairman of

upset of

Donald L. Patterson, Denver, partner of Boettcher and Com¬
pany, and Allen J. Nix, New York, partner of Riter &
Co., ViceChairmen; Ernest W. Borkland, Jr., New York, partner, Tucker,
Anthony & R. L. Day, Treasurer; and Wallace H. Fulton,

•

as

solent

to

standard at present mint purchase

of Economics and

a

Charles L. Bergmann, New York,
partner, R. W. Pressprich & Co.
Mr.

Hubert

men

turn

Such

ways.

the South.

V

and

erroneous

both

our mone¬

tary system while striving for

Alabama,

such

Mr.

work

dog" against

further deterioration of

night and day.

marriage of convenience but

should

or

Butler has been taken to task by
Senator Smathers of Florida, who

brated

election.

on an

that

the

Bargeron

a

Paul

cockiness is based

assumption

there is between

as

the

now

hand and the Southerners

one

Walston & Co., Inc.

Curtiss, House & Company:
W. H. Newbold's Son A Co.

Thomas & Company

18

The Commercial and Financial Chronicle

(1782)

workers, unemployment is 10.3,%;
9.11%

Unemployment, the Cold Was
^
Year Claims
"

,

<4

and

in September of 1957. 1
September of 1958 there were

In

employees

1,461,000

drawn 15 weeks

of

President, NationalvAssociation of Manufacturers J yCompany,

and Chairman of the Board, Singer'Manufacturing

Elizabeth, N; J.

had

who

or more

1

Private

unem¬

ployment insurance; 50,800 work- "
ers
by the end of August had'yexhausted their temporary.supple- {;

spokesman dis-:
agrees with bis friend the Secretary of Labor that the recession
is oyer; saliently observes that indnstrial production recovery
of 70% outpaces the 19%: recovery in manufacturing jobs
and,25% non-farm jobs; finds it rather ridiculous that we
boast of American living standards in the "cold-war" fight
while pursuing anti-union activity bound to lower our standard of life; and pledges non-direct political action in fighting
the right-to-work laws. Mr. Meany also submits a program to
strengthen consumer purchasing power, and refuses to concede
legislation is needed to punish labor as a whole because of the
claims notwithstanding, labors'

y

■

,

*'■

sins of

mental

an

happening

are

will

the

where things

age

come

up evnry
trade
union

ployment

the

there

self

to

two

So

America

or

I

the

to

at

the

affect

this

Any prob¬

have
George Meany

American

is

o

f

fronts

nation

today

•

workers, because

we

It

is

a

of

but

Labor,

problem

the

that

entire

and when we
look at this problem we must look

face;

at > it; along with all of our na¬
tional problems against the back¬

ground

.77

:

affairs.

of world

in

country

weu

*■ernment
•

can

hPtte,.'

akp

m

'

*..

^

money on our
e

last:,;.

&

ii than

{ wb,j the Americaii

"

•

''

.

our

such

people

{

followed.

What happened to the lucky
union member who had received
the raises?.; Frequently he, found
that he was out of a job. Not only

•

one

that I thesbrpoliti-"His

programs
"■

'cbjme" tentlaTmafrEet*.^

have

jobs

7,^>

^

_

Now, what does this mean? Does, are bought with easy payments,
this mean that we accept
4,200,OpOfpai^ by somebody else.
'

union tactics had; forced
1

'

union members' paid iii 'the'
end alon& with all the rest of;us.

many

The' Government's contribution
to the wage-price spiral was twofold.
First,, it encouraged ;-the

growth of union monopoly.

.

And

permanentIy;:unemployed^^es^«rra^^Tg2^^ijLV*T^r^t»a"'then it increased the~"mohey sup-

as

this

that

mean

areT.going. to .ply to

we

c;;»ntinui.n; unemployment
these millions
out of the

with

insofar

market

ma]5e up the American standard
livin^ with thp sln«an »RlJV
Dav
later" somp nolltioiam
.

purchasing

as

is concerned?

power

three years.

'

!

new
show

:v-li".:7:: caii b;.- spend- that bat the money he had wasn't
own m0ney.;Each
of worth as much as it had been.

-

ing

Li_htn.
ter',7

c

MiIt

'

,

•,

The TindsT?

been

fUling
customers with Utopian ideas—
using the slogan, "Buy, now, and
neyer pay- at air.'' :; ! ;::'!/ !!{ '

Well, if it does, it mean recurring
depressions everyq two or;

".--'"'i

<

on so long
began to be
reluctant to buy. The public bef
came reluctant last year; and the

only 25% of all the npn-;^ -iffprtive, 9»1ps arci]-'
farm jobs in the country ?have
ment used by such a pbiitieian is
oeen regainea.
^ that these government programs

were:

Unemployment

there

.price list
price
in- ^
:';'7* aV'; 7% 'M!.7•

•'

,

us^^bu?':recession

S

of the decline that came with
ot tne decline tnat came wnri

is

this

could

But

each

know,

tended > to

has

se11creases.

aov-

:

-•-

.

I" "ipeople^the ^ This could only
7
fdea that
before the.. public

situa¬

the

profits.!

::?:T

Outlines
outunes

TActioii
Action

of
ot

Program
program

^ Sales! personnel are realists and

'

pay

the higher wages, con-

tt'ibuting to the inflaition.
Preventing the Next Recession
What is to prevent the next recession? As things now stand, absolutely mpthing., The unions Are
as powerful as ever,, operating in

die same untouchable lggal! pbsi-

Congress has launched mew
civiliah programs and fattened the
that the recession is
over;:whati.Trade Commis'sioivandrtlie Bdtter ol<l ones, while continuing . the
is anything I think that, would we need is action on tlte part. of, jj^siness Bureaus are "in
#p(gi- g*feat appropriations canniiqr.
hurt the unemployed person any the Government and the Congress
tion to condemn false advertising cold war.; And now the governto strengthen consumer
more than the fact that he is out
-buying.;-.o£ a political proposalrc ?
of
political proposal;;:;
ment has been deprived by the
:
recession of tax revenues and has
of work is to tell him that it is of power;
no
oe
gone into deficit financing on a
The
tax
structure
should; be
consequence, it doesn't mean
*.

What

Well, that would be pretty nice
if we could believe it, and if ther,e

know

need is not statements

we

vcah,t

ihis

Wolifieal

tr^e

he

saips^nnnpal

•

'

But

the

tion:

Feaeral

»

It is 13 years since the last war

ended, and 13

Recovery

'of

wasn't that much profit, as. you ?

Elections Do Not Erase

national problem and

must

this

Polling

v7Th ey

kidj

you can

about this

f;X.a.n4

increases

wage

! out

come

back and

"The recession is over."

have official

jobs in the trade union movement,

nation

when

are

ahead of you.

facts, and I think-

manufacturing

-

-

■

for

unemployment, &nd
assurance 7 tfiat
would pay the bill,

.television all Over the nation, and

a

/

;b e s t; that " the

jhey;

} 0 ,w
;/.sar y

'

a

Yes, we pay more attention to
/the four words
it, perhaps, because we represent

but this is

a"d

tnis recession.

campaign time sc the speech con¬
sisted of four words. It went on

ment.

e e m

;

over."

Lag Behind

of

70%
7U/o

solved this problem but we

Secretary

the

is

problem of continuing unemploy¬

hadto{pay{

.

d

that

eight or nine months has regained '

a

this

the. Administration

recession is

tion

speech the other night
television. It was the shortest

on

a

just

told by a

are

of

tion is that the industrial produce"

political speech of the present
campaign. It was delivered by a
in my mind, are the problems of Cabinet officer, the Secretary ,of
a; very
good personal
the nation itself, and I think one Labor,
of the major problems that con¬ friend of mine and a very good

not

get {^Someone

to

those dollars as taxes for. theni 'TheVunions' assui^ ythe^public,
employeircouid payresenta'A!~l"!
to use as they that the'? employetr could pay—
represents

we

Jobs

-

•

.....

pro*

theductivity./:'

unemployment.

I heard

national problem and
labor problem. The
problems of the American worker,

necessity

•

*

that must
the economic health of the

haven't."

'

.-/"'V
could ^increase

would be nice to say that we

It

lem that faces

for

sales?dollar.7 They ' want

exhausting their

are

The odd thing

things

these

of

nation is

o r

•

•

nation.--

One

time.

lab

that

"

move¬

ment

who compete

the Amer- ;
ican worker by statements: which have as a background a political
inspiration.

cannot

we

can;

by union "leaders.

-Today there are a great many knowrhow

the American public or

ignore anything
that affects the economic health of
So

trade

union

who

the day is past

keep

so

business

„

.

of thousands each! politicians

tens

is entitled to the

the other free

world.

nations of the

vital

importance

enough

strong

;

government

repetition of this by entering politics to combat political

a

p

• ;

August,? and

of

avert

can

this country and to

think

of

are

unem¬

to

here

56,000

were

Well, it is my feeling that election or not, the American public

discharge her obligation
to the freedom-loving citizens of-

she

subjects

which

or

blaoMs

head

increase exceisjdinf productivity fer laying

s

the question
not we can main¬

economy

N.A.M.

The

political system in
the I9S7>S& recession

{the basis for past ddwatum and asseverates that

,

m y one

the

tain

to

going

am

confine

whether

of

I

wage

on

unemployment benefits. 7V {J;

other problem,

any

or

of

speak

we

month

are

month

must relate it to

we

movement.

However,

when

So

there

program,

ing

sion if it comes.

the national and
where things
day that affect the

on

international scene,

spending and

.r

who exhausted their benefits duf.-y

Soviet aggres¬

back

turn

uncorrected.

remain

<V

In the States that did not adopt

tive

to

economic and

..

"the
We live in

our

averring conditions which brought

benefits, in th$ States that adopted
;
that temporary program. .<
y,.U>.v

few.

a

insurance ;

unemployment

industry's spokesman singles out the labor Movement

"internal threat" to

as an

Election year

By MILTOkUC. LIGHTNER*

y-

.......

-_t-

V

were

and Congress of
Organizations, Washington, D. C.

■

"i-F

,

By GEORGE MEANY*

■

>

of the country are out.
y
There were 1,100,000 fewer jobs
in September of 1958 than there--?

President, American Federation of Labor
Industrial

out

are

9.6% of the construction workers

^

,

of the miners

Thursday, October 30, 1958

.

.

.

r,

re

in which we
have still not achieved a peaceful* anything, because conditions
good.
solution of mankind's problems.
Well, here are some facts in
Yes, 13 years since we fought a
gard to this recession:
war to end
tyranny and dictator¬
Incidentally, we couldn't
ship and now for at least 10 of
those 13 years we have been faced anyone in the Administration
years

...

overhauled to

are

in

»

.

re¬

low

the

give relief to those 7ig
middle"

bv:ribW ir arid

topic

vet

can forecast our furealistic,-uni-y tures and if conditions remain as

.-y'its

r

There

old

and

groups.

i

.

.

Miuuiu-%

-

should

be

history

get form, modern standards < for f uhT they, are we are surely!laying the
for employment insurance throughoutgroundwork for a1 new -recession,
the past year and a half to admit the country. ■ •
with
the
threat
of
T-. •
A
-7 " .-7".- ;. " 77
dictatorship
that there-was a recession, but
just as vicious if not more vicious
There are many, many thingsV. T
j Basis for Recession
than that which was faced during suddenly because there is a reduc¬ that could be done to
bring about ■
The 'i basis" for
the
recession
tion in the number of unemployed
World War II.
more employment:
-7.
-7:
which-began last year was inflawe
are
told that the recession is
We can have no illusions about
Long-needed public services,like;; tion.; The! paitiesTprimaril^v reover.
this question because this
is a
schools, housing, roads,vhospitals^sponsible; for this;-.inflat'iO"hr!W6re
Well, it isn't over even though and
fight between the free way of life
many other ways in whichsthe
government: and organized labor.
this is election tirnn in a campaign
as we see it here in America and
economy can be strengthened and
Here is how it worked.
Tf
the slave way of life as it is prac¬ year.
strengthened in the only place -''. Government encoUraged the de-7
.

scal€ .unprecedented in the peacetime history of our country.
,

Too few of the American people

realize.; that entirely aside from
the record defense budget we have
a record budget which has no conneetion with defense whatsoever.
"'x'
Who is responsible for this great

-

surging growth of Federal activ-r

7;''-!7

ity? y;.;7*

C

'

.

•

,

ticed behind the Iron Curtain.

There
lion

are

one

and one-half mil¬

unemployed in America
Our Unemployment and the
.today than there were one year
U. S. S.R.
ago. That is a fact; those are the
This is a real threat. Anyone official figures.
who

has

studied

world

affairs

know that the military po¬
tential of the Soviet Union is such

tnust

that

.

their

overrun

ground

Europe

troops

in

a

very

could
short

time.

.'

'

-

tember
work

7.2%

was

,
„

in the last

is

pressed

must be taken

as

a

real threat and

not

just as something that
shrugged off.
It is also

.

is

a

a

power

fact that

leader of the free

our

can

be

world, and

-

we

will

it

or

not

because it is the one nation thai
has the material resources and the
-

* An address by Mr. Meany before the

Bricklayers,

Masons
and
Plasterers
Union's 65th Convention, Atlantic Citv.
ft. i. Oct. 14, 1958.
'




per

cent

emergency de¬
the Labor De¬
partment's own measuring rod, so
if that is so, we find that the en¬
area

tire nation

nation

it should be the leader of the free

world whether

considered

Six

as

a

whole is

over

the

6%; 7.2% for the month of Sep¬

one

the

of

labor

must

face

a

unions.

:.1

tremendous power in the

the

basic

industries

metal

that

workers,

employ

industrial

*

Reviews Kennedy-Ives Bill's

\ye>Jare■

directly concerned, but in my
it
a

is

problem that the nation as
whole must face.
It should. bf»

the
and

a

concern

not

of

just of

for workers.

Then,

of

.

:

7

S?ve^the!; ^p^yer, ^ choice^

have.ran-

we

course,

^

a stpke and

^ 2^^
let your- eom-

committee on " labor
rackets' aroused the public and it

McGlellan

became evident that labor legislawould be needed. When none

"was forthcoming, Senator Knowother

movement.^-'And^ wages went;^provide

In

' ••t

,

fectively the most extreme: dev
Background
bookmandsf for repeated wage increases { ; This influence is demonstrated
■ and frihg€Fbenefitsv So began? the
in the history of the Kennedy-Ives
wage^priee? spiral;with which all bill, which l would like to recall
the entire nation of you, and youi r ctfetomers,; be- briefly
* -' 7
those who,speak,; came so familiar. The big Unions ;
Fi
t
:therevelations
Gf/ the
because

problem that we are. .faeingy fac^,
that could affect the nation^itself,
Industrial employment has come
and that is the drive• ttiatiis^njdw;
up a little bit, but unemployment
on to hamper and if possible deis still near the peak in certain
stroy the trade union
areas.
In the transportation equipment
industry, unemployment is 12.6%.

tte

in politics tind

last Congress.

other

tember.

Sbi? mZmenU ButTLv

®lsc;,;,spMiiically. ex^utjpt,., labor

problems>

'

an

by

is

...

.

that

—;:!f:
that \ve'are going to have to face.
: As;{a 17 result,/[many 7: employers
Thisis one oftheproblemsthat. wef^in no posifibn* to -resist ef-

of the national

16 years.

,.

So

This; percentage of
7.2% for the month of September

they have shown in the field of
air

The labor movement used^|o.

be non-political, and its founders

oS 7?^ TPWS-,
^ T^emenHs
or jshouiji^aws,. which apply .-to^TOrone. ^t pressure group

STrotr

force.

guided. missiles

and

;Vxl"veiom'cm encouragea cne ol

theJpurchasingfS tSSHk?®

furnishes

Which

The unemployment on a nation¬
wide scale for the month of Sep¬

has been exceeded in four months

The technological advances that

anvthiivrT

mpflns

and ^ose politoans who are 0W17
ga^d
seeking their support

more

.

•

rpallV

it

^

It

sounds

almost

ridiculous ito

think that at this late
the

contributions

dateT-after

that

Continued

on

the

trade

page

33

.

^

A m erica's

Amen.ca s
■. ♦ An

address

m",

by

inventiveness and

®

Mr.

f

Ufh'tiUF

needed

senators

tried

legislation

to

as

amendments to a bill on the SenT

floor.- To prevent.this .move
from succeeding, the SenateTLabor
ate

before

St-

Continued

on page

30

Volume

188

Number

5790

.1 The Commercial

.

and, Financial Chronicle

(1783)
i

t

>

'♦

♦ «

♦

*

<

'

■

California IBA

Group Elects

properly equipped in mathematics
and physics—are
rushing into this

The Wealth oi Nations

./SI

new
a

in the Oceans
By ROGER W. BABSON

;
strck

Sho

in

Kind™!1'
Uhatthe

bismuth, iron and silver salts, and

,n

f

d

.i;ak

T-h

have

tional

Bank, newly

Vice-President,

elected

Chairman,

Crocker-Anglo

California

Group,

ment Bankers Association of America is congratulated
by

Na¬

minerals from

for

.

'

'

•

■

/

H.

Bingham,

Hiirry, Los Angeles,;

President,

Bingham,

Walter

nium

is still

being

&

.secured

'

..

;

,

from

;
;
river
,

i

SAN

FRANCISCO,

All

trip of 17 days from New
Cape Town has impressed
especially with the mineral

Group, Investment

Association of

rne

annuab conference of the national

elected chairman of the Cal¬

ifornia
ers

ance

America, at the

Donald

meeting, succeeding Curtis
,H. Bingham, President of Bing-ham, Walter & Hurry, Los An¬
geles. '
:G.••

Harvey

Executive Committee

Franklin,
manager, Municipal Bond Depart¬
ment, Merrill Lynch, Pierce, FenSmith

&

ner

re-elected

was

Tn

M

Frpnrh

^t rvf

Vir-P

the
.

Cal-

was

TnV

to Investors
headed

Bank, Los Angeles, was the suebidder

Oct

on

27

musfion CiVy

for

a

the

at

interest

net

a

"bonds/bearing

:

.

^

^

to

new

!the

for

Most of it is baled

cattle

ton.

the location of its fish-

product to produce milk of

?iesia,

citrate

of

feed

at

and sold

about

^/Recently**there

,

.

,

ironnd

antacid, powders.

mag-;

Company of Buena Park, Calif.,

These, last

are

-

women

selling

men

products

.

.

dealing ..with

For

•

-

law

Inv.

•

-

Kiri

This offering is
a

authorization
land for
and

new

for

a

buildings

1956

lobster tails

to the United States

is the first to catch my eye.

made only by the Prospectus.
October 23, 1953

"

400,000 Shares

.

'.

of
of

existing
existing

.

'j..

-

*

-

.

CORPORATION,

Planning of Penn.

.......

l

;

Common

Stock, $1 Par Value

p.ape' President of Investors Plan- *.

and

schools and additions

r^r-.ioHolinfr
remodeling

schools.

of

part

°| Pennsylvania'

^

g ?treet» haf an~

nounced the appointment of Ray
G.

Bender

and

Augustine

Price $15 per share

J.

.

*

syndicate bid a premium
$309 for the $2,600,000 sewer

The

bonds. These bonds are part of a

"authorization

Marasco

to

Assistant

Vice-Presi¬

dent.
Mr. Bender

was

associated with

Westinghouse Electric Corporation
•iiori and additions to sewage dis- and United States SteCl Corpora^'
posdl plants and for new sewer tion prior to accepting a position
lines
and
replacement of old with Investors Planning Corporafines.
* - *
" ^tion early this year. • !
for

construe-

Copies of the Prospectus
in

t-

states

securities

iii which the

and

in

may be obtained from the undersigned only - undersigned-is qualified to act ds 'a dealer in
Prospectus may legally be distributed.-

which the

—

An issud of

$1,400,000 street im-'
Mr. Marasco has been with Inprqvement bonds went' to ■ the: vestors Planning Corporation sihCe*'
.Bank syndicate oh a premium bid 1954. He was ip the bankingfleld;
of $1,109/ The bonds are part of for
several years before enter-'
a 1947 authorization for extension
ing the investment business with/and improvement of streets, pur- Investors
Planning Corporation.

'

^.

:

•



and

which

fore wastei The exportatton of

■

New Issue

PITTSBURGH, Pa.—Edward N.

nrpminm of ^2 099

a

are

.

Official Appointments

,

$3,725,000 school bonds, the

bonds

>

.

.

departments.

been /a

^*2?wining^ooav1^?^?^'

'

Not

groups, through successful com-.
petitive financing provide Calibuilding will house offices of fornia communities with an as-'
Police and Sheriffs Depart- sured source of funds for needed

enforcement.

$20 per

has

magnesia, "and- which has thousands of

Opportunity for Chemists

conHall of Justice. The

1

1954

fall.

and

Jjust now "electronics", is the
fad and many young men — not

.....

Thp

born

authorization

will be used to

new

gov¬

Gloucester,

These bonds

Prison, Court .Rooms for public facilities.
Traffic,; Municipal, and Superior
'courts and all other offices and';

nf

t

new

ments,

to

^

,

more than $657 million for civic
improvements required by Caiifornia's fast growing .economy.
The Bank and Its underwriting

A

a

was;

exfensiyely used in making, steel, '.come from the ocean, or from the
found in-the ocean, rubber, and ink. .
I am giving • land or the air. I hope to find in
The Bank group bid a premium" We have»barely begun to tap -thei special attentiop to learning what- Africa even greater opportunities
of $259 for $600,000 playgrounds' chemical resources of oceans,, riv-.' Africa is doing along these line. ' for profit from products' heretoand recreation centers bonds.-ers,and lakes, which contain most f
;
•4 rpi,^
X*

premium of $5,759 was bid
for
$15,425,000 Hall ; of. Justice
.bonds. Proceeds from the sale of

according

maturities, Dec. -1, 1959 to 1973.

.struct

as the next
both in the

vTljiahle^inesS

and

3.15%

! tyiese bonds

as

I

*

hedge against inflation, I
purchased some land near Eureka,
Kansas, which has been planted
to
alfalfa.
This gives me three
Crops a year, given normal rain¬
a

•.'"I:" ..'I-:.-!'-* 'today will be

,..

ing the past 12 months have raised

to

As

.

Proceeds

to

2.00%"

ing and exporting,.

the water.

selected

huge

* realize.. For
instant^, that an
"of good sea-floor ca'n produce

rates of provement of existing ones. ,
.
;
3%, were
Bank-of America and the under- investors
to
yield writing accounts it managed dur-

to

to educate and capitalize the

native labor force for manufactur-

coupon

6%, 2Vz%r--23/4%
"reoffered

cost

tunlties ln South Africa should be

fries laboratory. This laboratory's!

mankind

are part of a 1955^of the mineral wealth which has
for acquisition/ of been washed off the land during
playgrounds and recreation" millions of years. This includes
city and county of 3.06%/The centers and enlargement and im- ";

& County

of San Francisco various purpose
•bonds

'

boon to

where

raised,

ranci ,0f far - greater • value.
The;
from the sale of these boiids,
partc^qgan; ^as a producing potential;
of a
1954 authorization, \yill be
times that of the land.
used-for additions and improve- "
The
>
,
the world,
ho<,Dital

Blyth;rn®"ts ™ l^e h^Pltal

and Security First National

of

Mass.;

or

g end if I lived in the

know, how-

pleased that the

ocean

>

!by Baiik of America N. T. & S. A. i
and
including; American^ Trust

ressful

the
air
Pe?soriallv^T
wn11i?
he inIS Swi
J?th hniine« thnn^n
'
TfPLhS pnf ^ ? ifvlS S

-

premium of $289.

"

toSl

much

electron-;

automated fac-

else the chemicals foiind

water sell at $25 a ton! I am not comacre, contains more thari 5,000,000 tons plaining about this, profit, which
nine:...of..useful essential*Chemicals. The comes from the processing, hilt I
rhnqp Of rWhi Of wiv
rpmoval of
^ oi ciam meat> against one ton most activ$ U. S. company in this/use it as-an illustratiori that profit
;
amd■-nw%affltf;ro£*'beef' pork' or lamb on an acre - field today, is the Dow Chemical in the U. S. comes from manufaC°f Pastprage,
On land we farm£ Company, which has been suc- turing and merchandising rather
than from agriculture.
Another
^igndis._
,:
/i!:- only, a .few inches of topsoil, but< ^sfuRy
securing ; magnesium, i
For
$675,900
S a n ^Francisco i
Water' turns
out
vegetable from sea water. Recently Merck j l
Recently Merckj illustration of what I have in mind
hospital bonds the Bank syndicate',liatter
in. far greater quantities;
'Company has been using this-is the great success of the Nutrilite
bid a

"

;

jn

of

s^eetcS-^^traLs

Totaling $24,425,000

(San Francisco),

am

ernment* has

or

.S
school

.

San Francisco Bonds

Company,

I

be-fought

a

bustion engine, both of which are: will probably be offered stocks of
This means that when I buy
build ■ these tablets, I am paying ovdr
U. ,S.,; $1,200 a ton for alfalfa which I

Pr^iHpnt

nq

ft?

& Co

toriea

The
Navy -«is
just
to the great import-

under

attend

ically controlled

the floor

oceanography,

will

a

^T
Anpplpq'' used by almost every householder, i new companies which will
Chairman oT thnSomhiatiS Yet there are other far more im- vPriVate laboratories in the
^
Nominating portant things .which few readers because a cubic mile of sea

pnmmi+tPP
uommiiiee.

underwriting group

greatest

of

a-

was the discovery of fire; then the ~ tot-work will be in connection
for finPlv
discovery of the wheel for trans- with discovering, catching, procYhrnnJ,thi« ?T i fin/ut'
portation; then the discovery of* essing* and marketing fish prods^e i nna H is
steel and of electricity for indus- "cts- 1 hope, however,*it will be-.
r^nld at
wSiS
try.
The latest great industries* gm the study of the wealth of.the
Xy Mass
n
have been in connection with the ocean m other ways, as is now
al ;!>i-DU Ior
telephone and the internal com- being done in Africa.
Readers».w^»unarea,xaDxeis. .
,
*

.

:

An

-

'

Greatest Undiscovered

The

R.

Los An-

.

Rlvlh

Sec¬

>

.

of

-

cover

up

air and

Treasures

Connor

ifornia Group.

J.

retary-Treasurer.

N.

and

.The

Templeton,'
resident partner, Mitchum, Jones
&
Templeton, Sacramento were
elected to three-year terms on the

Vice-Chair¬

elected

was

President,
,

geles

Murray Ward, resident partner
F. Hutton & Company, Los
and

Moulton,

H. Moulton & Company,

of E.

man'

wealth of the oceans which

association at Miami Beach, Flor¬
ida Nov. 30, Dec. 5, 1958.
?

Bank¬

• war

three-fifths of the earth.

annual

-Angeles

for

one-year
terms effective at the close of the

*ger J. Jacobs, Vice-President,
Crocker-Anglo National Bank,
was

elected

were

feet.

^nW
should

to sel1 Products made in

can

waking

train

business administration and rlearn

is onlv as far down as fish
y as
ar rlown as fish

dred

v

beds,

riiWnri 1

to be
to be

-

operate nets and draggers, the distance of a few hun-

But the

Calif.—Al-

wo

for

Sng

-

Thi?Wi

to dredge

The ocean-which

I

Rockefeller"?

Mass

beiow the surface, while oil wells
down two or three miles.

ermen

W. Babioa

York to
/

bv the

Hole

resnect

of
should

^armLuticnl
LS

ocean several miles down;
Many mines on land are developing ore discovered a mile or more

»ever ,

Roftr

ura-v
.

Chairman,- (Curtis

«!*

'

Future9

(extend

,

while

..gold and

outgoing

-

thousands

of years,

Invest¬

the

have ereat

insteld

;of the
;

the surroundzing watershed

(left),

at Woods

heavy cables

been collecting

j.

Jacobs

of

he!w

e

v

J.

T

but
doctor

-

tion founded
r

of

;

Alger

prod-,
provides vitamins!

ocean

to control infection,
and stimulants for farm feeds.
;

course, magnesThis is my, first

d

o o

e s

ucts, the

Readers really interested in the
-subject should visit the. institu-

mineral

wealth..

hope of

-

-

iodine.

What

f

oceans

bottoms

many other valuable compounds.,
In addition to the industrial

°CeanS' th°UgW 35 1 ,imd in S°Uth A£rica'

r

incalcul¬

able

.

lum. and

ex-

student knows

; own

*

a llttle .money Per« lead, and, of

.companies

E very

ers.:

the

industrial

reference
-to the oceans,-which contain
such
huge
quantities
of
magnesium,

-

ocean

in

1t'JV mining hoards of gold, silvier, iron, top- antibiotics

w
for investment

i .a

ofthe

tomorrow's mankind;

.

!rt

resources

however, I were
just entering college,

specialize

chemistry with special

,

accords to the
untapped

-industry.? if,

young man

I. would

Enthusiastic about potential opportunities for investors
and
college students in the wealth of the ocean* Mr. Babson

,--v-

19

i'i

i- »

'

»

,

;

F. Eberstadt

&

Go.

*

^^

20

The Commercial and Financial Chronicle

(1784)

*

Inflation and Securities

■■

of

Chairman

City

New York

Mr. Martindell
will

cause

avers

new

a

of the dire consequences

warns

Leif H. Olsen

long

are

run

forbodingjy

had

reasonably

a

predictable upturn last December,
I

in

is

the

the stock

ket

a

downturn

new

specializes

This

a

program

would

Sept
had

in

bei'

the

Gov¬

ernment

not

paper money

feared to take
drastic

a n

less

the

before

The
cans

While the

ket.
Jackson

seems

astounded

is becoming less and

dependable.

No Long Run Hedge in Stocks

election.

puolic

become a
longer pos¬

no

t i-

inflationary
action

has

Martindell

b y

the 10-month

It

as

is

majority of

great

now

a

business

mar¬

ket has been

States

of "The Key to

Divi-

an

attack

serve

better

For
Leif

Bank of

H. Olsen

New York..

•

credit
as

is

this

in

lo

becomes

retard,
too

un¬

for

the

the

popular, the Government sparks a
turnaround.
These
alternating
periods, each lasting less than a
year, will become
and less manageable

by.

All

inflations

more

as

end

violent

times goes
trtis way

unless

they are stopped, and they
only be stopped by measures

can

that would

never

be sanctioned in

the United States.
We have
in

our

now reached the
stage
inflation cycle where
gov¬

ernment

to

bonds

institutions.
will

we

be

can

Within

undoubtedly

sold

five

only
years

reach

the

view, because
they provide a necessity, there is
an
expanding demand for their
product, bad debts are non-exist¬
ent, labor cost is negligible, and

of American
business.

*

nical

outlets

prosperous

flow

Hartfori Electric U.

is

man

at the far end

of

can

produc¬

tion

line

the

Ameri-

'

Underwriting. g r.o u p s headed
jointly by The First Boston Corp.,

and

nobody likes
think

to

happen

Halsey,

Utility Bonds

Stuart

Putnam

of

sale

to

issue

American
man'

ceased

to

function.

'f

Dr.

C. •'

fc,.

Maniort

token

has

man

a

vital

4.42%

American

of

Too

business.

"the

have

us

complex

far

as

old

share

many

river"

man

Private enter¬

prise just won't keep rolling along
the intelligent help and

$56

without

understanding

all

of

American

panies.

institutions

solvent,

to keep the
bond prices

purchasing

power.

One

only has

to go back to the financial
record
of the 1920's to see that the Ger¬
man

government bonds sold above

*From
the

a

Public

Education

talk by Mr. Martindell before
Foundation for the Economic
of

City,. Oct. 14,

Women,

inc.,

1958.




New

York

that

stocks

Less than

managed
common

any

will have to be
reasonably main¬
tained. It is not the price of the
bonds that will
suffer, it is the
value of the bonds in terms of

revenues

income

of $64,008,000

of

$15,679,000.

am

board is
to

member

Board

State

now

of

of

the

Indiana

Education.

Our

besieged by requests

Commodity Club of NY

per

se

are

President:

Werner

Lehnberg,

tion

100

companies
stocks

York

now

Stock

reasonable

excellently
with

listed

their

measure

of

the

on

Exchange

give
infla¬

protection.

These

100

securities

are

to

Second

Vice-President:

Charles

language in

found among the power and
light
issues, the chain stores, super¬

ference

each

ten

W. Scranton & Co.

The
use

utility

;

company proposes

to

the combined net proceeds of

.

basic American values

to

is

killing American freedom in
this country at the very time that
we
need to strengthen freedom
against communism. The business
of freedom needs intelligent "busi¬
ness
management and needs it.
badly.
Freedom needs to : know;
who its competitors are right here ;
at home and how to fight then *
through intelligent, advertising.
Insane

Congressional. Spending

anything
in

five

ment
on

the

Soviets have done
The extortionate
spendthrift govern¬

years.

of

taxation

a

makes

the

a

continuous

American

assault

worker's

pay¬

check which you credit men must

tion

to

keep

government limited

in the interest of freedom.

difficult

CITY, Mo.—The firm
markets, the chemicals, the phar¬
name of Ruppert Investments,
Inc.,
maceuticals, the oils, the soap
1016 Baltimore Avenue, has been
companies, and the metals. »To
changed to Van Hoozer & Co., Inc.
choose these companies one must
know that the physical sales vol¬

shares

stock at the

for

free

depend upon for the repayment of
Secretary: Irving Hankin, Mer¬ the billions that you have loaned
Lynch, Pierce, Fenner & Smith. to the American people. Liberty
Treasurer: Julius Rutkay, An¬ means
limited
government.
It
derson, Clayton & Fleming.
was
the purpose of the constitu¬

Now Van Hoozer & Co.

common

share

one

this financing
program
for the
our American system * payment of $27^00,000 outstand¬
enterprise which is very * ing short-term bank loans and
inadequately taught in all ourv apply any remaining proceeds to
schools today. This popular indif¬ the
company's continuing
con¬
of

rill

KANSAS

per

teaching of

Mattey, Bache & Co.

be

share for 149,633

of

Chas.

install

teaching of the Russian
Indiana schools. On
the contrary, we haven't had a
single request to strengthen the

pre¬

$50

21, 1958.
The subscription offer will expire
at 3 p.m. (EST) on Nov. 17, 1958.
The offering will be underwritten
by a group headed by The First
Boston Corp., Putnam & Co. and

history.
a

the

at

4.96%.

shares held of record Oct.

struction

program.
Total; plaqt
expenditures for 1958 are esti¬
mated at $22,000,000. Construction
spending for 1959 is estimated at
$12,000,000, principally for addi¬
tions

job to keep

It is

a

rapacious
government within its prescribed
constitutional
cannot

be

limitations
and

this

a

limitations.

done

without

That

electric transmission. and

to

electric

and

The

v

d

interest
less

V'

:

V,

bonds will not be re¬

new

deemable prior to Oct.
an

fa¬

gas-distribution

cilities...

of

hedge against inflation. In¬ E. F. Hutton & Company.
First Vice-President. Milton W.
adequate
depreciation
reserves
quickly erode the true values of Jiler, Commodity Research Bu¬
tne stocks of nine out of ten com¬ reau, Inc.

be forced to take these
bonds, and
a later
point, the Government

Meanwhile, in order

net

no

New

will have to take the
institutions.

and

I

offered

yield

per

rate

of living in the

The biggest competitor in this
Elects New Officers
adjustments can be had.
country now is the government
The Commodity Club of New of the United States.
(4) Above
The insane
all,
the
investor
turned
speculator
by
circum¬ York, Inc., has elected the follow¬ extravagance of the 86tji Congress
stances beyond his
hurt American business more than
control, must ing new officers:

point where these institutions will
at

operating

world's

to

of additional

people to whom it has brought the
highest standard

to, .yield ,about

maturity and

stock

Concurrently the company is of¬
fering to the holders of its com¬
mon
stock rights to subscribe at

American busi¬

as

is concerned.

ness

interest

to

interest in what goes on upstream " ferred
in

priced at 99.25% and

were

accrued

credit

the

W.

public

yesterday (Oct. 29) a new
of $18,000,000 of 4%% first

bonds

By the same

•

Chas.

and

mortgage bonds due 1988 and 100,000
shares
of
4.96%
preferred
stock' of $50 par value
of The
Hartford Electric Light Co.
The

business if the
credit

Co.

&

Scranton & Co. offered for

would

what

Offers

and, ultimate

The

consumer

credit

government

surrender to communism.

-

rate

remember

to communism.

consumer and
money but the only alterna¬
established tive is complete socialism, tyran¬

necessary

orderly

covering banking, insurance com¬
panies and the securities market.;

hedge against inflation.
hedge in the

investment point of

f

worse

firmly

now

of

one

or

staff of "The Wall Street Journal"

.

when

Hie American winker's

on

forestall ultimate surrender

Re¬

-

and

:

proper

.

Government-steps

Peace"

sion of the
Federal

Ameri¬

First the

?

Relations

Congressional spending hurts U. 5. A.
anything the Soviets have done in five

*

securities and business.

College of Law and

Inter-Governmental

on

solution requires popular support,
in order to install proper limitations and, thus,

time and money

think of the stock mar¬

early stages of inflation. As time
goes by, however, as it has now,
inflation is nc respecter of the
share owner, except in very lim¬

than

more

paycheck.

& Co. Inc.. and,
associates offered yesterday (Oct.
doing precisely what
29) an issue of $10,000,000 Texas
reasonably can be expected" dur¬
ing a 'serious stage of inflation;- ited
areas.
Those
who
choose Electric Service Co. first'mortgage
for inflation, with its dire conse-'* the [dock market as their means bonds, 4 •■»%> series due Nov.
1,
quences, is now in our economic of protection should follow cer¬ 1988,
at
101.656%
and
accrued
saddle.
interest, to yield 4.40%.
Award
tain rules:
of the bonds was won by the un¬
Perhaps the best definition of
(1) First, and most important
derwriters at competitive sale on
inflation today is, too many peo¬ of
all, the company must be ex¬
Oct. 28 on a bid of 100.9599%. v
ple chasing too many dollars in cellently managed.
Net proceeds from the sale of
order to buy unnecessary mer¬
(2) The enterprise must be well the
chandise of doubtful quality. Since
bonds, together with proceeds
financed and, therefore, able to
derived from the concurrent sale
it has been estimated that most of
acquire other products and other
of 80,000 shares of preferred stock,
our national expenditures are for
companies under favorable cir¬
and other funds, will be used by
luxuries, the foundation of our cumstances. The best
holding at the
inflation is greed, the most uncompany for construction pur¬
a
time like this is a company of
J pleasant of all human charac¬ no funded debt, rather than one poses. The construction program
is expected to cost about
teristics,
$33,000,that owes everybody. Surprising¬
000 in 1958 and $25,000,000 in 1959.
With an indifferent public, any
ly enough, when money is cheap
The 1988 series bonds will be
full blown inflation, like
malaria, in purchasing power, it is hard to
redeemable at general redemption
must run its course as malaria* come
by. This is because nooocfy
prices ranging from 106.16% to
does within the body of an indif¬
wants to lend it. Who is anxious
par,
and at special redemption
ferent victim.
A malaria attack lo
put his money out at 3% when
prices receding from 101.66% to
is "characterized -by precise
the annual decline in purchanig
pe¬
riods of chills and
fever, alternat¬ power is 3% or more, thus de¬ par, plus accrued interest in each
case.
ing with a rhythm that is more
priving the investor of any real
Texas Electric Service Co.
is
discouraging because it is pre¬ return whatsoever?
engaged in the generation, trans¬
dictable.
The third stage of in¬
(3) Companies and industries
mission and distribution of elec¬
flation, and that is what we are must be avoided for the long term
now
experiencing,
is
likewise where there is both a combination tricity wholly within the State of
Texas. The company, Texas Power
predictable and frightening.
of high labor cost and regulated
& Light Co. and Dallas Power &
Must Expect Government
return.
This is true of all the
Light Co., whose respective sys¬
Alternating Actions
transportation companies, whether*
tems are interconnected, are sub¬
are
railroads
or
airlines.
Investors must expect, for some they
sidiaries of Texas Utilities Co.
years, alternating government in¬ Strangely enough, light and power
For the 12 months ended Aug.
spired advances and declines in stocks offer the very best hedge
that one can wish for from a true 31, 1958, the company had total

rise, the stock

Commission

and constitutes

years

Infor¬

mation

Karom,

He declares "insane"

,

formerly

Public

and

Dean Manion labels current Federal taxation "extortionate."

Chief of the

excellent

an

of

Author

V
United States and be a person of
Before joining the Federal Re¬
substance.
From here on in the serve Bank in 1956, Mr. Olsen was
capitalistic system will reward the a financial writer for "The New
speculators — those fortunate York Times'' covering ban king
enough, and courageous enough and the money markets.
Prior
to take the steps called for when thereto hbwas a member of the

have

em

must

It is

who

do

Chairman

in

in

Boynton

Bend, Indiana

Former Dean, University of Notre Dame
Former

bank analysis....
Mr.
Olsen

sible to remain an investor in the

Novem¬

-occurred

One

capital?

to

one

speculator.

month.

downturn

ber

is

Doran, Manion,
South

conducts

and

at a time when a $1,000
bond bought only a package of
cigarettes.'
What

.By CLARENCE MANION*

-

Attorney-at-Law,

Vice-President

stocks

bank

par, even

making which will see
mar¬

retreat

next

-

state

now

can

a

Schapiro
organization

no

'

we

as

The

was
as

ft

t

In the Inteiest of freedom

fective Nov. 1.

of inflation and that stocks in

•

Just

*

IiSHuldil

of the firm ef¬

hedge against inflation. Deplores the
situation where investors must become speculators and pre¬
dicts the Government will have to maintain reasonable prices
on its bonds
or eventually will have to force institutions to
take government bonds, or take over the institutions. Suggests
four rules for those choosing stock market investments.
the

i

r

i

Thursday, October 30, 1958

.

o

Schapiro Co..

A. Schapiro & Co., Inc., 1
Street, New York City, has
announced
the
appointment
of

which

downturn is in the making

He

■

.

Wall

--

stock market retreat next month.

a

mo

»'±i

,

M.

of Management

Board, American Institute

the

/

M. A.

By JACKSON MARTINDELL*

,

.

cost

than

to

the

1, 1963 at
company

4%%. Optional

re^

prices range from
104.38% to the principal amount.
The
special redemption price is
par.
The new preferred stock is
redeemable at $53.75 per share on
or before Nov.
1, 1963 and there¬
after at prices decreasing to $50.50
per share after Nov. 1, 1973.
e. m

p

t i

o n ;

Hartford

ritory

Electric's

service

ter¬

approximately 1,000
square miles in Connecticut. Prin¬
cipal communities served include
covers

Hartford, East and West Hartford,
M a n c h e s te r, Middletown and
Torrington. Population of the area
is about 675,000.
For

the

12

months

ended

Aug.

31, 1958 operating revenues were

$50,508,000 and net income $6,927,C00 against $48,784,000 and $6,962,000 for the preceding 12 months.
/

proper

and popular support
understanding and sup¬

Chicago Analysts to Hear

CHICAGO, 111. —Dr. F. • Otto
port cannot be generated without Haas and W. T. McClintock of
business management.
This will Rohm & Haas Company will be
PASADENA, Calif.— Jack D.? be hard selling. It will take time* guest speakers at the luncheon
Hay is now affiliated with Shearmeeting of the Investment Ana¬
pany's business can be financed son, Hammill &
*A statement by Dean Manion before
Co., 348 East
lysts Society of Chicago to be held
44th Annual Convention of National Con¬
without the issuance of additional Green Street.
He was formerly
Oct. 30 in the Adams Room of the
sumer
Finance Association, Bal Harbour,
shares.
with J. Logan & Co.
Midland Hotel.
Fla.

ume

be doubled in the next
ten years, that an
adequate mar¬
gin of profit can be sustained, that
the growing volume of the com¬
can

With Shearson, Hammill
(Special to The Financial Chronicle)

Volume

188

Number 5790

.

.The Commercial and Financial Chronicle

.

(1785)
improvement market mean to all
banks engaged in our Title I
pro-

The

Growing Opportunities
Property improvement Loans

In

21

'

jyVllll AM

+Vk«sn

$11 billion.
million

50

Federal Housing:
Administration, Washington,

presents

D. C.

for

The almost inexhaustible market for home
improvement loans
depicted by FHA official after observing that the self-

modern

We

like

home

to

refer

to

improvement

the "3 R's."

the

FHA

program

mighty
important

words...

analyze

Remodel-

rents, equipment, etc.-—and have
a
sizable, reserve for insurance.

Repair-Repay.

There

Wrapped up
in

lenders entering

these

''three

is

$8

dustry

Title

an

billion

is

shot

-

not

insurance
the

in
Roy F. Cooke

portion

of

properties.
this money

comes

income.

or

nanced

out of

On

hand, at least 20%
repair

the

A

fi¬

be

lenders

industrial

States FHA Title I Is

•

*

An

address

Instalment
St.

to

a

by Mr.

Cooke

.

.

.

$5

dis¬

$200

to

nearly
loans have

larger

on

the books is

for smaller loans.

as

this

Wn

m

q

butQtni

occupied.

it

nn

tubs

tnUiinn

23V

What

good business

and

Let

imagina-

evaluate this tremendous

and

thl

^g8 family fo^Sions

seeking

to

establish

time,

active

Title

loans

has

I

in

its

lVi

insur¬

New
at

loans

the

day and
month

million.

.

.

are

rate

of

These

We

in¬

know

it's the way to

credit obligation. Also, it showed
that of families with annual in-

to

from

only

be

tion

$3,000 to $7,500 per
40%
used
consumer

developed.

of

60% market

a

The basic funccredit

consumer

the

is

is

in

these

purchaser, and
figures there
pent-up purchasing

aid

to

view

of

lot

loans.

the

in

—

.

power

nation.
...

,

_

„

the

question

is

show

ures

we

are

and
the

on

(4)

a

common

sense

credit

consumer

accepted

perfected

offer

sell or a solicitation of
offer to buy these securities. The offering

is

Program

paying

big

Governors of the States; of West
Virginia and Vermont have issued
increased
$100 million in out- Home Improvement Month Procstandings compared to $20 million lamations urging alt citizens of
for lenders on their "own plan-" their respective> states to remodel
The American Bankers Associa- an<* repair their homes,
tion survey of delinquencies reAbout the biggest compliment
ports "own plan" delinquency at paid the Title I program came by
L48% and Title 1 at 121%> °ur
of .^.vlsit.or from Australia.
0wn Call Report/ as of March 31, Aftar sitting in on one of our
reveals Title I delinquency to be Title I Industry Advisory Corn1.11% in 1958 as compared with mittee meetings he spoke: " I have
reports
business has

same

This low ratio in^jcates that people are paying on
their Title
loans

visited all countries of Europe
studying housing but this is the

there is some unemployment.

Xve seen bankers, ..ndustry and

1.29% in 1957.

eveWugS

,, ,
To assist lenders in collecting
delinquent accounts,

have

we

the 5"Pre-claim Letter." This "Preclaim Letter" is sent at the redoest of the lender by the local
FF^. off10® to the homeowner
advising his account is overdue

^a^7^

^1.paiA^al^nce-' Jhe result.s ?
J?

ar?.azingly

successful, 39 % ot all delinquent
accounts, where this letter has
bee)1 ufed> ^.ave be<rn paid in full
?r made active again. This letter
is now

m nationwide use and
available to all Title I lenders.
Black

lountry f
In

fjrst and only

which

rrlTrTh^coZo^ood'o^tSe
homeowner "

in the world." he said.

Named Trustees
Thft eJecjdop.qf, Maurice S. Ben¬
jamin and D. J. St. Germain as
trustees of the American Surety
Company ot New York to fill existing vacancies, was announced
by William E. McKell, Chairman
and president;#
Mr.

and

And Contractors

jamin

investigation,

6,500 such

we

oper-

the

New

of

Ben-

firm

Hill

& Co.,- which corn'
operations in
1921.
A

he holds

industry,

membership in the New
York Stock Exchange, is art asso-

*

assistance
given apTitle I lenders is the
policing of unethical dealers and
contractors, commonly known as

founder

the
of

veteran of the securities

Another

over

investment

menced

proved

have listed
ators who

Benjamin is
partner

senior

York

is

Listing Unethical Dealers

ciate

a

member

of

the

American

stock

Exchange, and a member of
long standing of the New York
Society cf Security Analysts.
Mr< st Germain also has been
acyve jn the investment business
j:or

many

years,

having founded

to

by the Prospectus.

are

industry

by

profession.

credit

sumer

code of ethics

the borrower

builds
.

.

the

and

Good

con-

character

lender will buy his

under certain

150,000 Shares

FOREST LABORATORIES, Inc.
CAPITAL

MIAMI, Fla.—Loren L. Cluster

Program" is
most effective because legitimate

is now associated with Goodbody
& Co., 14 Northeast First Avenue,
He was formerly with Francis I.

contractors

du Pont & Co.

tions.
This

"P.

M.

List

periodically to give

us

in

with

per

Copies of the Prospectus

share

may

be obtained from

con¬

Street

same

the

regard

local

Groups which
ized

in

J5M»H

We

communication

ELECTRONIC

PRODUCTS, INC., Plainfield, New Jersey. Is engaged
engineering, designing and manufacturing aircraft and
precision components and industrial gas burners.
The Company also engages in the overhaul and repair of airborne and elec¬
in

the

business

miscellaneous

tronic

of

accessories,

instruments.
.£■

Advisory Com¬

For

,

your copy

'

of Offering Circuluf

the

and

Title

have

I

admiration
Lenders

been

STOCKS
240 W. Front

•

MUTUAL

FUNDS

744 Broad St., Newark, N. J.

PL 5-3700

MA 3-0190

37 Wall St., New York, N. Y.
Please

Committee

BONDS

•

St., Plainfield, N. J.

organ¬

larger

other

.^ritc to:

BERRY 6- COMPANY

banking com¬
munities throughout the nation.
Our

New, York, N. Y.

31,

$100 per $100 of Debentures
HAYDU

practical operating point of view
most helpful and useful. We have
for

Wall

DEBENTURES

December

Subscription Price:

of the nation.

Lenders

our

^

due

mittee and find its advice from the

the

Greenfield & Co.. Inc.

area

constant

\

-

CONVERTIBLE

fj7

W

Committee

Advisory Committee

graphical

A

on

sists of 25 of the leading consumer
credit
bankers
in
the
country.

are

products, inc.
SUBORDINATED

These lenders represent each geo¬

PRICE

ELECTRONIC

HAYDU

advice.

Credit Bankers Placed

Advisory

home-

$300,000

that FHA Title I may keep
fingers on the pulse of its pro¬
gram from a practical operating
approach, we have created two
Advisory Committees who meet

One

($.10 Par Value Per Share)

the

serve

can

in

it does not de¬

.

So

STOCK

(Special to The Financial Chronicle)

condi-

stroy it.
v

except

paper

regulatory

all




This

dividends. It has met with: such
an enthusiastic reception that the

a

should be sold

basis;

banking

T

their figinsuring 70%

now

of a11 loans- The
show that Title I

After thoiough

asked,

•

should be extended in accordance

'''*!■

the

"s"cde^shoe boys'1 or "dynamiters."

.

Lending Criteria
Often

with

37

for

lender, the

.

Now what docs this huge home

$2.50

the

manufacturer> the dealer and the and address manufacturers' sales
homeowner'
meetings, conventions of trade
To give an indication of how associations state and local groups
TitlaJ ia grov™g- three months *2
them on the °Peratio"
ag° thTe F?deral Reserve^ reported of
Title I as

this

"What rules for granting consumer

-

.

the

is made only

operates

all

of

a

avail¬
country.
However,
011 the other
hand, sales promoted
by unwise and risky credit use
are
dangerous to the economy of

con¬

NEW ISSUE

an

of

iliai„

survey showed that 50% of
families have no instalment

,

credit should

Greater

not an

benefit

we have an educational
program
underway. Our Dealer
Relations Unit and Financial Representatives, which are spotted
throughout the nation, meet with

out to cheat and
own
J, St. Germain &
good lender use?" swindle homeowners by not in- Company in
We consider consumer credit as
Springfield iix 1924 to
The criteria
I use,
and this is stalling material according to con- specialize in bank andi insurance
the most modern advancement in
based on experience in both bank- tract
or
overpricing
the
job stocks. He is also
generaLmanager
banking and truly one of the
ing and manufacturing, are: (1) exorbitantly.
A disappointed 0f pirst Springfield Corporation,
greatest creative ideas of this era
consumer
credit is
intended to homeowner is not a good payer established in
1932, and of First
because
it enlarged the - buying
serve the buyer rather
than the on a loan. This type of contractor Financial
Trust,
established
in
power of the average
man who
producer; (2) c 0 n sum er credit and dealer is put on our "Precau- i922„
lacked cash for purchases.
should
be
granted on a sound tionary Measures List" which to
Title I is pleased to be one of the
basis to create an asset and not al1 intent and purposes puts him
outstanding pioneers in this busi¬ a
Joins Goodbody Co.
liability; (3) consumer credit out of business because no Title I.
ness revolution.
sumer

Louis, St. Louis, Mo.

This advertisement is

that

program

balanced

a

serve

$100

all

moraUv

.

JSSU^ssssje
buy and obtain possessions. which
would otherwise be impossible if
it were purely a cash transaction:
However, a recent Federal Re-

5,000

reaches
are

r- ,

All in all, we have

on

.

the amount insured
often

.

being
about

modern

a

home.

credit.

of

few

a

_

market!

a

sense

tion

able

portfolio valued at $1Y2 bil¬

each

make

before

These

same

per

Going

of

same

from

sured

going business.

Association

1%.

borrower has

This rate gives the lender

lion.

recovery.

a

the

in bigger profits to lenbecause the initial cost of put¬

ance

proud to report that
is

Credit

re¬

.75 to

to one-half of

rate to

million

Business

I

ifi

credit which leaves

At

and loans, had any
interest in instal¬

am

4?!?

+w

fn Tn wL
ii£
central hSinid
mi
water 9' ^ rnmion^io bath

year

the

unsecured loans to homeowners to

Title

lowered from

ting sizable loans

or

induce

Today I

+Uf

"built^ btfore S

were

comes

ers

lending.
It developed that it was up to
FHA Title I to lay down the broad
principles of consumer credit and
guarantee loans until lenders
gained experience, All this was

FHA

of

This

resulted

ment credit

;

the

$1,000.

sagging economy. In those days
few lenders, especially banks

our

2

them

v

.

most

oi Snn bL Jnf

all

very

promote

of

increased

other

began in 1934. It was a
depression device to stimulate our

savings

The

During this period of premium
reduction, the average loan has

to

sav¬

of this home

investment must

experience

was

•

improvement loans;

Old

mtf rest to
recent

rm-i

them.

good net profit, plus 90% insur¬
ance
on
the
unpaid balance in
event of claim.

by lenders.

to

dollar

a

program

done

each

on

premium has been

April 1958

count.

The FHA Title I loan insurance

and

its own way by
one-half of 1% insur¬

"rerhpined the

their

maintain homes

ings

rate

But

yearly

maintain

great

the FHA Title I

.65%, in August 1957 to .55%, and

outlay by American homeowners
to

new

duced three times since 1954 when

a

ex-

penditure of
$8 billion, but
the

Years

i

2^17^0

pays
a

premium

ance

provement.
This

60

the net proceeds of the loan.

im¬

one

I

charging

in¬

.

home

as

program each month.

little

words"

than

more

26-30

rpwin ?n *^ -10n ?°"sfeS

can

engaged in instalment credit

: are

Are

shadow

the

which

^
•
■* ' ^
low ones can cast on ilie 165,000
s Sroup is known as .contractor-dealers participating in
Advisory Committee, the Title I program
>
*
It advises Title I how the program
To help our contractor-dealers

fill-

insuring 63% of all home

lending in about every county of
the nation and
every possession.
We are self-supporting;
paying all
pm wmmmmmmrn of our overhead—salaries, claims,

but

re-

only

,n

These "3 R's" for us
Title I symbolizes three
little,

in

mm

the last improvement."

as

66%

I\Ve have 12,800 approved lenders

as

T

suspicion

Th!^ consumers. for the dealers and further,
* working

market

It is weU to

-Ahome

-

without

owner

the Industry

This

year.

house is

a

manufacturers, retail dealers,
the National Better Business Bu-

'

- y

over

improvement loans be¬
always want im-

50 years old

or

how government's home
improvement loan insurance program
does business,, and how

contracting firms and leaders
profit from it.

each

—whether'

member

presently spend $8 billion every year on their properties
20% of this must be financed by lenders. He explains

'

•

people

ingete

owners

„

-i

?io^€^^oration^ddflVr01^Snnriit?nn"

supporting FHA Title 1 home improvement held is presently
$10 billion market and that a very large number of homes
are more lhan 20 years old. Mr. Cooke points out that home

a

and

y,

are

inexhaustible

an

home

cause

are

V

bemVhnnt
oeing built

are

<4rVf

There

homes in this nation

_

By ROY F. COOKE*
Assistant Commissioner, Title I

Vf| U11

'

•

u-n-S

en

than

rial

21

has

a

membership of men on the presi¬
dent or vice-president level rep¬
resenting business, building mate-

send

me

a

copy

HAYDU

NAME

CITY

of

II

WH 4-1812

the Offering Circular

ELECTRONIC
:

•

PRODUCTS,

relating to
INC.

77

I

STATE

I

:

22

The Commercial and Financial Chronicle

(1786)

will

Company

have

share

for

share.

.

.

Thursday, October 30, 1958

.

ber of shares outstanding—75,000

shares,

\

par

value $20.)

290,000 new shares of First Na¬
* tional common stock Of $10 par

'

value each, This, would yield $7,The merged institution will have" ;'
^
7 ;.^ *
•*// *..
outstanding 92,000 shares of $20 ; Directors ofMerchandjse/ Na-:7. 830,000,'^f whichjamoynt $2,900,000
par value-capital:stock.; *'
7;c ; ' Jional Bank of Chicago, .'Iik^pnZ would^be^ad^d fa
and the
The proposed'merger will residt Oct. 21 proposed an increase in remainder of :$4,930,000. would be
fiut vin suypltis. f.In: additipjav $1,-,
in a county,wide banking institu- capital through,ya 1 for ^11
stock^
;wdtrld 'be transfdhred ffom
tion .With total resources in .excess^ dividend; .according
to ;/,;an77 aft-'r
undivided' profits
into surplus;
of $62,000,000, and total capital. nouncement from Kenneth K. Du
Thus present capital stock of $23,funds of $4,478,000.
Trust assets Vail, President.
will exceed $72,000,000.
*
:
The proposal would raise the 100,000 would be increased to
$26,000,000 and present surplus of
The
merged bank will, have
*1^50,^ $28,000,0007 would be raised. to
eight ; offices
throughout
the 000 t° ^i.SOO.OOO and- _increjse
$34,000,000.;
v7 ;:.7. >
v
county
located
in
Morristown, inimberoi,shares by 35,000 to 'Ji":With the proposed enlarged capMadison, Florham Park, Morris, u'uf ? ?.n
su,^ieCi.
I1!1/ italizationin.effect,FirstNatiorial
Plains, Denville arid Chester serv- approval of the Comptroller of the Bank
would also have, besides the
ing the banking needs of rapidly Currency and votmg_of stofkhold$60,000,000 capital arid.; surplus,
growing Morris County.
r
cis_at a special meeting ivov. 4.
Under the
plan, shareholder; approximately $6,000,000 in jundi4
n®w. nam^ ls' P*anne<* for the ^ duld receive one share at $10 par yided prpfits and about $8,000,000
merged bank. ^ .*. 7; value for each 11 shares. owned, in reserve for contingencies, mak¬
*
*
*
^
Du Vail stated. Scrip certificates, ing a total capital account of ap¬
Bank of Passaic and Trust Com- marketable for a stipulated period, proximately $74,000,000: -;
7 ; 7 #
The proposal calls for the new
pany, Clifton, N. J.f has changed will be issued to avoid fractional
its title to Bank of Passaic and shares in the stock split.. Hence- capital
stockto be ' Offered t td
Clifton.
;■>
*7 -'/v'v .'•*
forth,., the directors plan to con- stockholders of record Dec. 2 bit
•

,

News About Banks

...

.

,

^

'

CONSOLIDATIONS

^

NEW BRANCHES

Bankers

and

NEW OFFICERS. ETC.

REVISED

CAPITALIZATIONS

"

Tbc First National City Bank of to an announcement on Oct. 29 by
New York announced on Oct. 22 John J. McCloy, Chairman of the
that

William

I.

Vice-

Spencer,

Board.
"The Union of South Africa has

President, has been assigned gen¬
real
potential for
economic
eral supervision of the bank's Pe¬ a
troleum Department, succeeding growth," Mr. McCloy said, "as in¬
J. Ed.
Warren, formerly Senior dicated by the rapid progress it
has been making, particularly in
Vice-President. V
v
7
recent years.
We believe the fa¬
; Mr. Spencer has been instru¬
cilities of our bank, offered lo¬
mental "in
the development
of
special banking services for clients cally, would be of service to the
area as it continues to expand its
in the petroleum industry. As ad¬
industrial development at home
ministrative head of the depart¬
and its trade abroad."
ment he directs the activities-of a
Mr. McCloy said that in order
group
of
petroleum engineers,
to conform with South African
geologists, .and lending officers,
banking regulations, Chase Man¬
who render financial counsel to

-

.

;

7*7 jtinue the present diyidehd. pf 25

I Mr. John J. Lynch, Vice-Presi¬
and trustee of the. Kings
County Trust Company, Brooklyn,

elected

corporation in South Africa, to be

^

tional

named

Preliminary
to

arrangements

are

future. ' 7

near

ft

The

■

■

an

as

.

recommended

an y,

Cohen

Mr.

-

-

•-

shares.

-

tyncn

j.

1922 and joined

in

fc. Y., has been elected

Manu¬

The Dime, Savings Bank of Brook¬

lyn^ N.

Y., it is announced by
George C. Johnson, Chairman of
the Board of Trustees of the bank.

He will fill the vacancy created by'
the recent death of John E. Baxter;
*t

.

ft

ft

The. First National City Bank of

.

New

York

announced

Oct.

on

20

that it has increased its maximum
oft

monthly
payment
business
loans, from $25,000 to $50,000. ,
The bank said it had done this

,

to

more

adequately assist small
expansion in • changing

business
economic

times.

the

In

past

;

30

years the bank has extended-more
than .171,000
monthly payment
business loans totaling over $335,7

000,000.

-

*

.

ft

ft

>t

George H. Jlurchum, Assistant
Controller of the Chase Manhattan
Bank, New York, died Oct. 21, at
the age of-63. ^Mr.
Burchum
started

his

banking

of the two Banks in 1929:
He was
appointed an Assistant
Manager in 1951 and an Assistant

merger

trustee of

with

career

the Seaboard National Bank, New
York, in 1915 and served with it

Secretary in 1953.
'* 7
•
At present, Mr. Cohen is as¬
signed to the Bank's 39th Street
office.

the

recommendation

the basis of

on

one

and timing of the

Irving Trust Company, New
York announces the appointment
6i James K. MeKlllop as Assistant
Secretary.
Mi*. McKillop has been with the
company since 1952 and is in the

Company Investments Division.
ft
9
\
>;,.
The First New Haven

it

is

section

the

nth

of

in

is

Haven's

West

of

opened

first

the

of record

Dec;

1.

its

Equitable

mergers
with
the
Tru it Company, New

?''77'■"

New

Union

York,

and; the Chase National
Bank, N. Y., into the Chase Man¬
hattan Bank.

■'

ft

ft

.

stock

,

agent: Trust De¬
partment of The Miners National

■

.

...

.

-

Elyshurg, Pa„ with

1

'

•■ft'

'

ft

Irving
Trust
Company,
New
York, announces, the election of

Wilbur

G.

Malcolm

to

its

Board

of Directors.
t

...

ft

»

Richmond

ft

P.

ft

was

common

capi-

Vice-

voluntary liquidation by
lution

of

its

a

shareholders

reso-

dated

Company, Trenton, N. J, July 18, effective* as of the close
announced Oct. 23 by Mrs; of business Oct. 10.
Liquidating

Mary G. Roebling, President and agent: Mr. Daniel Mowery, care
Board Chairman,
of the liquidating bank. Absorbed
Mr.

West's

N. Y., died Oct. 22.

Mr. Gardner's

age was 58.
I

Mr.

Gardner

joined

the

Fifth

a. new

delations

ftiade

business. and.
In

man.

Assistant

1934,

customer

1943

Cashier

he

was

Pa.
f:

*

ft

ijs

ft

#

in

capital stock from $200,$300,000 by a stock divi¬
dend; effeCtiye Oct. 14. (Number
of
shares
outstanding — 3,000

Gardner

concerned

him¬

self with commercial banking.
'

#

.

The

Chase

ft

Manhattan

proved and authorized the
tion of

an

to

execu¬

Olmsted

institution.

;

'Under the terms of the

agree4

bank for

Office

.

which ..had : its

in

Cuyahoga. County...
*

a Banking office in Johan¬
nesburg, South Africa, according

Trust

was

holders

*

ft

r

j;

.

.

.
,

mon

open




Executive

AStori,

the Bank.

I

the increase in
capitalization and issuance of the
stock dividend wilt be submitted:
to shareholders for approval NoJ
vembcr 14.
7.7:
■;
1
Proposals

for

first

Republic

Bank

in

the

will

be Hie

Southwest 4tp.

reach 1 the$100,000,OOO-mark - in
capital and surplus, and .will rank
in eighteenth position in capital
and surplus ampng ^banks of . the;
Nation.
Completion of proposals
would bring total capitalization; of
the Bank, including.7 contingency
reserves, to approximately. $113,*
000,000.
;
;
7
^.7■

Bank's Board of Directors

The
on

Oct.

27

detailing

.

-

48

holders of record

*

jand's oldest bank, has 19 offices. capital; and $34,000,000 surplus,

Bank and Trust Company will re¬
ceive one and two-thirds shares
for each share of First Bank and

Bank,

7

,

agreement of merger o|

Now York, has made application
the appropriate authorities to

*

"

•

Company, Mor-

ment the shareholders of the First

to

'

adopted resolutions,
proposals for the in¬
crease, and calling a special meet¬
ing/Of the shareholders Novem-|
shares, par value $100.)
ber 14, for shareholder action on*
J
*
*
*
the proposals to accomplish, the;
v f J. C. O3borne, Vice-President of following:
"
-7
the Trust Company of Georgia in
1. A $13,000,000 increase in cap¬
Atlanta, Ga„ announced on Oct. 31
ital and
surplus ,of the Bankr
that the New York Office of the
bringing Republic's capital and1
representatives of the Factoring
surplus to $100,000,000;
77
Department moved to the Empire
2. Issuance of a stock dividend
State Building on Nov. 1.
This
office was formerly at-15' Broad of 89,428 shares of the Bank's $12;
Street, New York, and the Bond par value stock, being 3% of the
shares currently "out¬
Department representatives of the 2,980,950
to be
distributed
to
trust Company will continue to use standing,
shareholders without cost to them,
000

.

Mr.

on

■

Chairman,

President of

common

grand opening Oct. 24 and 25.
*. J Stockholders of First National
£945 Assistant Vice-President. In the two institutions, subject to ap-j
Manager of (he new North -Olm^ Bank in Dallas, Tex., will act Dec.
1949, one year after the Fifth proval of the Commissioner of the sted Office is Thomas E„ B'urris, 2 on a proposed $8,900,OOOirtcrease
Avenue Bank's merger with the
Department of Banking and In-* previously Assistant Manager at ip the bank's capital andT surplus;
Bank of New York, he became a surance of the
Office, which would-bring the total to
State of New Jer¬ the bank's Chester-40th
Vice-President. From that time sey and the stockholders of each National ^"City, which is Cleve-. $00,000,000,
divided
$26,000,000
and

ft

a modern, the downtown location.
and
,7
Harold W.
Sterns, will be. in
community," is the way President
3. An offering of 85,170 new
ristown, N. J., and First Bank anc^ Frapcis H. Beamrqf.The National charge of the office, assisted r by
William Savage and Miss Agnes shares of the Bank's stock, with
Trust Company,.Madison, N. J., at City Bank of Cfeyeland,- Ohio,
pre-emptive rights to the share¬
separate meetings on Oct. 21 ap¬ tlescribed the ^hk^'mew North* Jean Knight.

'A modern

The boards of" directors of The

Morristown Trust

Avenue Bank, New York, in
as

appointment to the by: The Guarantee Trust and Safe
Company of vShamokin,
board brings the Deposit

number of directors to ^7.

President, The Bank of New York,

7.The Garden; National Bank of
Garden City, Kan., increased its

.

tal stock of $45,000, -has gone into

West, Jr.,

Trenton .Trust

Gardner,

■

.

ft

ton Trust
i

ft

capital, and
surplus of the Republic Nathuial
Bank, Dallas, - YreaS' -to; $100,000,000;«issuance, of 'a ;'3% stocl<7diyidend;t6 shareholders;7a ;6^ % infi
creasp iii cash; dividends;^ from

Currency,
dividend The Mer-

of

'

Election of James W.

;

Kam,, increased its common caoi-

-

1

t

common cap-' ^ tal stock from
$1^200,000 to $1,-;
$100,000f has ^gotVc ? 500,000, effective Oct. 16-..(Number
into
voluntary liquidatidn - by' a of - shares outstanding — 60,000
l esolution of its shareholders dated
shares, par value $25;)
July-31, effective Oct. 10.
<
*
» "
«
*

ital

Liquidating

to the Board of Directors of Tren¬

at

d

Minersville, Pa. With

-

,,

J

chants National Bank of Topeka;

»-

National: Bank

ceremony
were
his grand¬ Bank of Pottsville, Pa. Absorbed
father, Matthew J. Coyle; Joseph by the Miners National Bank of
A. Schmitz, Manager of the branch j Pottsville, Pa.
'
■ft
ft
ft
and Joseph H. Allen, Chairman of
7 :
vthe Board and, Chigf Executive
The
First
National
Bank
or

!

S: Vi:" h-'

,

selectman,
branch for

business. Assisting young Coyle iii

'

' ft

Plans for inereasing:

7 Committee, and James W.

s
stock

a

the

Officer.

,77':..7" ".A

Policy;

.

through

cpntemplated^that'the regu-i

the; rate; of $1.40 7 per share per
year,,, paid quarterly, which' iff' an
annual yield of 5.18 % on the sales
price: of $27: per-share. : 7; *:

Florence,

10%
-

stx^k from $100,000 to $200,000 by

directors

rhade.
The

Have n's b i*a n eh banking system. •
Matthew J. Coyle, III, grandson

officially

':!

a
7'

First National Bank in De Kalb.
m. increased its common capital

announced when the cash offering

Haven/

First

It is

Upon ratification of proposals
stock, effective Oct. 14. (Number
of
shares
outstanding — 5,000 by. shareholders, and formal ap¬
proval by the Comptroller of the
regarding future dividends will be shares,-par value $50.)

National

West

the

*

.7

board, of

bank's

holders

Located

business

•

lar dividend Wiirbe eontinued at

standing stock, payable Jan. 2 to

>

Allihglown Branch on OcL
in the Ailing town'

new

20.

price '

* ~

said they expect to declare a $1,3(1 a s^ock dividend, and,-from $200,-.
a share dividend on preseiftly out000 to $250,000 by the sale of new

Bank, New Haven, Conn., opened
its

stock diyidend.

effect

offering will-be

set later.
Th6

tal. to $l,650y000 through

share for

new

ft

ft

stock

'is; ap-

each four held, after giving
to the stock dividend.
The

;•

.

ft

new

per ^hare annualiy-Ti
Natiorial. Bank's capital;7\yas in-# and simultaneous payment by The'
Howard Corporation et al, wholly
proved by- the shareholders 8hd ;by creased from $1,000,000 to $1,500,State
and* Federal
supervisory ,000 when a 50% stock dividend owned in trust for the sharehpld4
authorities, the stock dividend will was declared and shareholders re- ers of the Bank, of a $2,000,000 eash
be
distributed Jan.
2, next, to; eeived six shares for each share dividend, were announced jointly;
by Karl Hoblitzelle,
shareholders of record.Dec. 1. The held. Another increase in Novem- M an day
subscription offering will be made her, 1956,: rgised the bank's- capi- Chairman ofthe Board,. Fred F.:

:If

facturers Trust Company with the
JoMn

53,750* to

John D. Heckman,'

.

began his Banking

with the State Bank, New

career

York,

J

an

ital stock from:

New

Chairman of the Board...

cap4 |;4,900,000;

increase'ih

share of

a record high, Du Vail
said'.".; The bank's capital account,,
Presi-" ha^ increased more than $1,600,0 )0
dent, said the proposed iqerease or almost 50%, since, the- end ; of
will be submitted to shareholders 1950,he stated. 7
■
*
at a special meeting off No^TOnv:.,,:; In June,. 1953, the Merchandise $1:08;to; $1792

Trust

Manufacturers

of

o m p

-

.

of Milton
Assistant Vice-Pres-^

York, is an¬
nounced by Horace C. Flanigan,
C

>

.

'

'-v7

.

7

amount, $150,000 will be applied
Pa., anftounced on Oct. to capital, raisihg it to $1,800,000,
24
a
plan to distribute. 26,875 and : $350,000,. will be applied to
shares of stock as a ,50% stock surplus which would total $2,700,diyidend and "20,156 V*, shares in a ooo. : ^ ' "
"
;
7
- " :
s 1 '
subscription offering, to.§tockhold- ; With approximately $400,000 reers.
*' 77 maifting in
retained^earriing^, the
The
board
of
directors-has bank's capital account would total

appointment

Cohen
ident

ft

%

;

;

of Reading,

ment, who will be in South Africa
the

;
*

one

for

...

Pitts-

Co;,

per share quarterly/on the

City Bank and Trust Company;

.

lantyne, Vice-President in Chase
Manhattan's international depart¬
in

Trust

&

the basis of

each eight shares bwried;
>
The proposed capitalization in¬
common stock.
5*
;
crease would be the bank's
v The dividend: will be made possey±
sible through transfer, of $500;,000 enth, since 1950 wheir the capital
from retained earnings.
Vthis structure totaled $13,00(1,000. ^
cents

director- of Mellon Na-

■:

handled by Donald L. Bal-

be

a

Bank

burgh, Pa.;

Manhattan

Chase

The

of South Africa, Ltd.

Bank

dent

,,

Richard Mellon Scaife has been

1

hattan would establish a domestic

ft

.

.

the

,,

.

.

f

the oil industry.

^nk's

.

Company stock and share¬
of

the

Morristown

Trust

stock' dividend,, iftie ,com4
capital stock of ; National
Boulevard Bank-of -Chicago, Hi.,
-

By

a

increased from- $1,000,000 to

$1,500,000, effective Oct. 14, (Num-

standing.The
will

of November

*

,

-

monthly cash dividend rato

be: increased from

$0.15 to

share, payable on all
outstanding, effective for
the month, of December, .1958, and
$0.16

j

First National directors voted on
Oct. 21 to recommend the increase

as

14, at $60 per share,, aforesaid
rights to expire December 1. Basis
for this offering is to be one share
for each 35 shares, currently out¬

per

stock

ajnd cajled the special meeting of payable oh Jan. 2, 1959: This will
the shareholders for action on,the increase the dividend rate on an
proposal.
i

annual

.

by the sale at $27.

per

share

basis. from $1.80

to $192

share. This increase will be
of applicable to the new stock to be

The increase would be effected

per

Volume

188

Number 5790

.

The Commercial and Financial Chronicle

.

.

(1787)

23

j*

•

issued.

Under

the

dividend" mittee;

new

rate; cash dividend payments to
shareholders will exceed $6,000,000 annually.

Mr. Williams

\

March

Giving effect to proposals for
the increase, $7,110,200 of
new
capital funds would be 'paid into
the Bank. An additional $5,889,800 would be transferred from
the;
Undivided Profits Account, giv¬
ing a total of $13,000,000 in funds
allocated te increased capitaliza¬

of

,

made

tion.^ Issuance

Kauai

shares

new

be

concerned

came

1947

the

Branch

in

of

the

on

to the

Island

of

Mr.

per

Kauai

of 1947 where he
Assistant Manager of

c a

test year., £or the
first quarter of the current fisctil

period

million in the fiscal
ending May 31, 1958. Net
$13.1

outlet and $25 thousand gross

ings

share

per

ings fori fiscal 1958

improve in direct relation

the

Williams

at 90 Gents per share ;

to gross.

.

they do not manufacture

pointed Assistant Manager of that
department in January of 1957. -.*
-?•,
that7 H-V w*•?/.

salesmen

d

not

are:

union.

J)1 ■}.'.* 1
J'
'vr.'•'*■ ?' Minas
Gerais, Brazil, has ;> more
Hawaii, Honolulu, than 280 branches located in every

receivables

■

of

—/ '

:

of

1

a

see

in

risk

no

the

fact

that

...

v

with

its

funds.

to

receiv¬

the

fsistant Cashieri

state of Brazil and

appoint¬

them

this

tremendous

purposes—through
^

Qf the bank's Loan Com-

Kanlre''

*'•

banks

ent

behind in' payments

network

a

Mr. Williams is important
^American
on+'

of

assured

•"

ac¬

.

by 90 days,
1 unpaid
balance
must
be
charged-; off against income and
-though the debtor resumes payj

paM.-^ Thus

*

earnings

of

any

1

lections
in

Suggestions For Selling

are

the„ following

year

Earnings / for the fiscal year
ending May 31, 1958, which were
"Mutual
Fund .Service"
The suggestion is also advanced
projected; about two months ago
which is published by Kalb Voor- that you Lgive out one
piece " of
his & Co., New York City,- and literature /at the meeting, but; in at about $1.40 per share have de¬
pdited by;Ferd; Nauheim, has ex- your talk, you refer to'another by veloped to be 90 cents per share
clue rito " the
accounting practice
cellent material available in its its title
(MSS has a very' excel- above referred to.
Earnings of 90
regular issues that can be helpful lent ^folder* available
for sub- cents
per share on .a stock selling
not only- to those concerned pri- scribevs5 with the compelling title
around $10
(Over - the - Counter
marily with the distribution of <"I Want .MYDQllars Guaranteed")
mutual-funds but other types of Using a strong title such as this Market) is a creditable showing
under present business conditions,
securities as well. This service is and preferring to it at the concluavailable either on a straight fee si on of yoifr* talk you -say, "I'm particularly where new sales units
are being added each month which
basis or can be secured through sorry I - dbn't have
any
of the
the placement of orders for seen- 'Guaranteed- Dollar' folders >with may eventually, add to earnings
i'Y*. and in addition, reserves set
rities listed on, the > New York me, tyut if you would like to have
Stock Exchange with the member a copy .just give me .your name Upagainst Accounts Receivable
Will begin to show up in earnings
firm that are the publishers.
" ' at the end of the meeting.
I'll
this fiscal year., C ,•
\
A recent issue developed -ideas See that one is' sent to you~
; v
j.

T

uSpSinpoint is made !?!
^ef-re
The
that

t

the

demand

and that many program chairmen
will jump at the chance to obtain

services for

subjects

with

talk

a

such

on

investing in mutual
funds, tax saving ideas, financial
planning, etc. Here are some-sugas

V

gestions from MSS:

sure

you

can

you

out

j "Ask

you

bulId

Improving Telephone Prospecting
MSSH

the

covers

certain

reaching;

and

find

out

time you will have.
a

subject

that

how

best

fit -the

If

know mutual fund investing
couldn't
pick a more interesting subject." '
you

and all it has to offer you
«T4.

•

^

.

.j

.

*

-*

.

It is a good idea to limit questions to after your-talk-. If your
_

aaidience

is

allowed

to

yoii repeatedly,
you
justice to any subject
audience.

Explain

interrupt

cannot
or

to

do

to your

them

to

•

The

the
to

delivery "

point is also stressed that
to win new prospects is

way

avoid

any suggestion of
outright commercialism. The closer
3*ou stick to the idea that you are
there to inform and to educate, the
more

good-will

you

will

While avoiding commercialism; it
is good to include how you worked
out
some
case
histories
which

problem

names,

about

when

.persons 1

of

course,

are

added

to

this list each month at the rate of

of

12,000

month.

a

This valur

professionalmen

national Silver flatware at

a

sub¬

stantial discount from store prices
'and on a
lO-month installment

'

promising.

so

IBA

Group Elects;

ST.

LOUIS, Mo.—At the annual
meeting of the Mississippi Valley
Group of the Investment Bankers
Association

;

$6.25

-■

of

America,

■...c ?:

be

elected

ficers

in

add

and

warrants

219,433 shares
capitalization of

will

rants

add

about

$365,000

to
Kern

the company's assets.
The
brothers, organizers oft the

j

Breckenridge^
Chairman,

ex¬

McCourtney-r
Breckenridge
& Company,
St. Louis, Mo.
Clarence

SL

Blewer, Vice-r
Chair

Hunter

m a

n?

Blewer, Glynn
&
Company,
St. Lovris, Ma.

Breckenridge

about

common

the

year:

Hunter

-

of the

the

fol-

we re
' of¬

for

ensuing

Funds

used

the

lowing

common

share.

per

to

are

into

shares Making a total of
813,433 shares outstanding.
The
exercising of the options and war¬

Louis

■,

A

r

Lanford, Secretary - Treasurer,
Hill, Crawford & Lanford, Little
Rock, Ark.
Mr.

'■

*

't.

Elvin

Breckenridge succeeds
K. Popper, I. M. Simon &

Co.

v

busi¬
about

'.V*

*

"

Newly elected members of the
it is understood, own
Committee
are
Mr.
60% of the company's commoif, Executive
assuring aii avid interest by them Popper, John H. Crago, Smith,
Moore & Co.; Edward D. Jones,
in sound business practices.
ness,

their

desires

are

Edward D. Jones &
.

.

.

satisfied

never

•

Burkham,

G.

Co.; Elzey G.
Walker & Co.;

H.

Mel F. Cooke, Dean Witter &

.

an

.

interest to buy

is not too; diffi¬
This, perhaps, explains the
high rate of sales to personal Calls
cult.

and

Howard

P.

Morris,

Taussig,

Day & Co.; Inc.
Mr.

Crago

Mr.

and

Jones

are

The silver i£ especially
designed for Atlas and is obtain¬

sistant the best time to reach him
the telephone. Here's a sampler
.

,,

,

4

When the gill a swers, start,
identify yourself pleasantly
a
<H>nfj.dentiy My* name lsJaekson HarttfdJaekson ot the Sd|ndH company
Are you Dr.
S™'th s secretary?
Usually she
to

will
her

say,

!Yes,' and also

narne.

wonder

if

give

you

Then

yoii

you continue: T
could tell me tine

^est

time to telephone Dr. Smith,
when he'd have a few minutes to
(aik?

j have

to

some

discuss

ing to tax "savings

ware

and

of

a

aluminum

cook¬

secretaries

will

react

in

of three ways. If the doctor is
free* she may put
you
through

chandise

offered

is

necessary

the ^manufacturers mail the
cles

10%

direct

to

response

the

to

as

arti¬

customers.

this

A

check with the doctor
if he will take the call.

once, or
see

Since 1954, sales have increased
from $3.4 million to a volume of
„

time, either be-

fore or after office hours, when

tuaent to the subject
you cover in

"She may ask for further
planation and, if this happens,

•

ex-

ex-

the

on

currently
the annual dividend

as

stock

earnings

share

a

well

is

of

secured

by
this

nearly

amount and

a

dividend

keep

in

future

increased

A

tools"

for

T

-

for

demand
men

for

basement workshop

workshops

plain the purpose of your request
for an appointment as you would
to the doctor himself.
"The

preliminary

call

to

the

secretary gives you a natural in¬
troduction for your talk with the

savings, or whatever appeal you
are
using with these prospects."

of

Twin
Club

have

the

City
to

.

.

comparison

.

.

.

produced

some

sewing machine in

to the

held

at

For the first two months

of the

current fiscal year beginning June

1st, net after taxes

Coleman's

iri

Highland Park, St. Paul, Nov. 19i
Mr.
Manske's
subject
w 11
be
in

Municipal

"Distaff Dollars"

?

a

"Distaff Dollars" exhibit at the

162nd

Convention

of

the

New

York

City Federation of Women's
Clubs, Inc., Friday, Oct. 31, in thef

Grand

Ballroom

Hotel.

Focused

of
on

in

several

Biltmore

role

contemporary

of

the

women's

capitalism, the
presentation
will highlight tbje
actual
telephonic administration
orders from

buy-and-sell

security^

the convention floor

Mrs. Rose O'Neill, registered
representative with the firm.
rt

by

machine tools

put into the basement workshop.

reserve

will be guest
meeting of the
Investment Women's

or,

.

which

be

Paul

the

Harris, Upham & Co., 99 Parle
and such Avenue, New York, will feature

garage

pairs around the house.
Is it not possible that the house¬
sewing machine
as
a
"hobby tool" for which she
can
put it to productive use in
the making of her own dresses,
her
daughter's clothes, and re-.
pairing those of her husband and
children?
and materially less

is the

St.

at

•

useful articles of furniture,
made possible inexpensive re¬

cents

Bank

speaker

"hobby

very

costly

Municipals

MINNEAPOLIS, Minn.—Stanley
Manske
of
the
First
National

Trends
in the* "Current
relationship to Financing."

earnings.

the

City Inv. Women

To Hear on

great deal has been written

about

or

Twin

payments

good

a

wife can regard a

'

"Shell suggest a

cents

being paid

mail-order

approach seems a reasonable ex¬
pectation, and each item offered,

one

to

50

...

-

;

The

dish manufacturer.

perhaps three to four a year, could
add
approximately $2.5 million
pertain- in gross business to the company's
his personal volume for each item offered.

investments.'
"Most

ing

him

on

.

.

twice
yield of about 5%
pays well while waiting for de¬
The company's investment in this
velopments.
The
dividend
has
project is limited to the cost of
only recently been increased from
the
mailing piece and offering 40 cents a share and it ris my
letter
no
inventory of mer¬ understanding management will
manufacturer

suggestions I'd

with

not only

about the company
but more'particularly for the em¬
ployees' individual future.
.

basis.

pay

the doctor is usually available to
doctor, something
like
this:
'I
talk. Or she may suggest you call called
your office yesterday, Dr.
Helped clients to solve their prob- him at home in the evening. In
Smith, and your assistant sug¬
Urns. Also, there is nothing offen- either case, you thank her for her
gested that I call you before 9:30
slve in giving out
literature, pro- help, and make the call at the in the morning.' Then you
go right
yiding it is educational and per- suggested time,
i
into your basic approach on tax




low-cost

People like to buy things

a secretary who answers the
able only from them.' A similar
telephone,'find out from his as-: deal has been * developed with a

create.

your talk.

.

594,000

,

have

that

you will reserve 10 or 15 minutes
to questions after your

most

much

needs of the particular group.

i:

Since

on

Then choose

will

at

would

in. the

.

be

incoming Governors of the In¬
they are . free and willing to talk, pble list offers the company the experienced by Atlas salesmen.
opportunity to
enter
the
mail I have visited two. of the Atlas vestment Bankers Association of
such as is the case with profesorder business with an initial of¬ Centers and found them to be America,, representing the Missis¬
sionalmSn, doctors, dentists,
.
chiropractors; veterinarians, and fering of a 48 piece set of Inter¬ very enthusiastic organizations sippi Valley Group.

ground

in trouble."

are

four years to

•

thoroughly and with satisfying
completeness.
If
you * wallowabopt or bog down and your time
runs

time

any

ing of the options

.

.

the

cover

.

experience

those

to
participate in the
growth of a company in which its
past history has shown to -be so
evident, and with projected de^
velopments for the next three or

version of the bonds and exercis¬

New Business

long

for

Co.;
phone call and a possible installment business has devel¬
and particularly if the thing
Clark Cox, Harris Trust
Sav¬
Public speaking can oped a list of 500,000 people whd purchased can be used to
promote
ing Bank; Firmin D/ Fusz, Jr.,
have
been
good customers and their living enjoyment.
Selling
^stlge and sales,
jived up' to their contract. New to one who has already evidenced Fusz-Schmelzle & Company, Inc.

Bather thap contact^them
completethei^ho^s which, is sometimes,
absolutely resemted, MSSf sugg^ts:4

feel

opportunity

assume Some small risk

order

$6.27 per share and warrants
purchase 33,333 shares of com¬
mon at $6.25 per share.
The con¬

a

V "Limit your talk to one subject,
Don't attempt to give a

package unless

:

an

interview.

fori speakers

with a knowledge of investment
principles is at an all-time high

your"

';i:

a cov-

erjng .letter and can be followed ■*:-Atlas'

and clubs.

today

be mailed with

in

Atlas

offers

excellent
in

to

,

can

think

willing to

to

,

These

/,

,

machines
I

company's opera¬
tions.
In addition, there are op¬
tions
outstanding
to
executive
employees for the purchase of
26,100 shares of common at $5.70

i ;. The

jjr^denmg - ;through the me-

at

pansion

quent payments catch up.

•

sewing
States.

Centers stock

.

received

Better From "MSS"

^^ues
prospect groups

Sewing

-

stock

one

delin¬

as

excellent

&n

In

ible

rise sharply

poor and

of

United

March, 1958, the company
sold publicly $1 million of 6%%
convertible debentures, convert¬

year might be depressed if col¬

By JOHN BUTTON

of

.

labor market in South America.

hients
on * a
regular basis, the
charge-off remains as a liability
Until the? total unpaid amount is

\Securities Salesman9sWarner
Two Good

A cautious

policy is practiced by
the company. If an account falls

correspond,

tured anywhere in the world
in
fact, the company has been

ables has averaged about 1% over

the past 10 years.

;.

'j

has

computa¬

volume

counting

is represented

the 'Ufiited States—for banking

in

As-

as

on

volume

Atlas is the second largest dis¬

sewing machine manufacturing
business. However, Atlas owns all
its patented designs, and the sew¬
ing machines could be manufac¬

Company's loss record

6f

of

own

the

Hawaii, ' announced

ment of David Z. Williams

tions.'
>.

the

sewing

Conversion

share

which

tributor

..

.

shares,

1957.

this
period
increrscd
Capitalization to 644,768

been used in the above

reported

.

,

.

and the

members

>

machines
are
imported
' from Japan, though this has been
-•Proposals^also-stipulate
a questionable
surplus be increased from, .$51,-,
Brazil's largest private Bank has i The company is well financed
thought with some.
228,600 to $62,133,424, making to¬ established a non-banking serv¬ with bank credit for handling in¬ The quality of workmanship on
tal Capital and surplus
ice center at 666 Fifth Avenue, stallment purchases and the com¬ Close tolerance machines made by
$100,000,New York. Banco da Lavoura de
000.
;•••v..
pany finances about $4 million of Japanese mechanics has brought
Bank

in
in

the drop

are

earnings front 1957 is explained
above, by the very conservative
accounting practices!
/ '
4

tion at this time that Atlas is not
involved with union labor
.

from

in 1957. Earn¬

hi

It might be well to call atten¬

...

cents to $1.34

seven

year
earn¬

advanced

p€T salesman to a total of $42.5
million of gross business. Net will

was

bit aiv stock "Would

$3?;666;5T6r: Hi*1

period

same

«-

bonds

the possible gross in three years
with 85 outlets and 20 salesmen

sold, together withthe.v returned to the Bank of Hawaii
stopk .dividend, would make 3,- Credit Department at Head Office
155,548 shares outstariding,; arid Ih, August of 1958. He was ap¬
the- hew

4

common

Lihue

July

Branches.

'

; ^

I

that time. After a short training
period at the bank's Head Office;

transferred

f f '

year, sales rose 19% over the like

ployed by the Bank of Hawaii at

was

i

Seattle

First National Bank, and was em¬

he

> #

to. Hawaii in

from

stock to be

amount to

% t,

Continued from page 2

mostly with small business loans.

•

of

will

and

"

t

•

equaled 26 V2
doubling

included

requirements

over

the

H. B. Eatherton Opens

:

DENVER, Colo. — Herschel
Eatherton is conducting a securi¬
ties business from offices in the
C. A. Johnson

Building.

24

The Commercial and Financial Chronicle

(1788)

and

Utility Securities

additional

will

Public

an

be

available

The

By OWEN ELY

million
and

San

Diego Gas & Electric Company

plies

Diego Gas & Electric sup¬
electricity and natural gas

A local business
major eco¬

stability.

I960 at

zation

amount

same

Expendi¬

1958.

for

$29 million and

lime ago at about

for

nomic

the

Dec.

of

as

Capitali¬

$27 million.

1957,

31,

was

index reflecting eight

48%
debt, • 16% preferred stock
population of about 929,000 nomic series advanced to a new and 36% common stock equity
in San Diego and environs.. The high of 265 compared with 239 in
(with ;four million shares out¬
large and permanent U. S. Naval June, 1957, an increase of nearly standing).: The equity ■: ratio had
base is a feature of the area. In¬ 11%. The construction index rose declined from 44% in 1954.
to

a

dustrial
plants
manufacturing,

Grains

to 486, a

include aviation,
electronics,
etc.

eitrus fruits

and

are

gain of 43% over a year
at that time from

70%

of

contributes about

mercial
sales

and

to

of elec¬

4%,

rural

revenues,

industrial

49%

and

utilities

and

mu¬

Domestic

other

in

the

from

The

peak

kw.

the gas revenues.

in

; San Diego, like other California
utilities, has enjoyed a rapid in¬

lete Station B,

5%.

cently.
California

in

the

in

$1.30

to

utilities

.

$1.51

to

declining

three

1955-1957 showed an aver¬
age gain of over 10% annually.

485,000
be

San

now

re¬

been

have

oil, gas

Diego's cost of

and

had

latter

heat

a

of

'

$50,000,000

over

company's
from

gas

billion

14.2

billion

in

cf

ships

and

Subsequent mergers and expand-j
past five yearsj- ing business marked the growth of
been spent the firm through the years/ Its

for these purposes.
The debentures

:

present structure was formed iri
1942 when the firms of Libaire,

;

non-refund¬

are

able for five years, but are other¬
wise redeemable at prices ranging
from

103%%

acquired memberships
Exchange.

and

the New York Stock

on

pur¬
!.

has

to

Stout

Co.

&

and

Eisele

&

merged.

King
7
•

^

the

chronological

and chemicals. The com¬
pany's
Durkee
Famous
Foods
division, accounting for about 46%
of sales, is primarily a supplier
foods,

chemical

operations

construction

titanium

dioxide,

in

the
gain in the latter year being rela-i
lively small due to warm weather.
Gas supply line capacity has in¬
to ,18.9

1953

1957,

was

credit for interest
the

months

12

on

ended

Aug.

31

150 a share com¬
pared with less than 50 a share in
the previous period.
Early this year the company
requested rate increases which it
was
estimated were required to

sonnel.

record

©f

all

per¬

The brochure will be dis¬

tributed

within

interested

firm

the

clients.

and

7

1

to

1

i

Stern, Frank, Meyer & Fox
To Admit Partner

complete line of paints
and coatings, about 60% of which
are trade, or non-industrial sales.
The paint division produces about
42%" of

a

sales.

The

chemicals

terpene

products.

/;

New York and Pacific Coast Stock

Exchanges,

oil

tall

— Stern,
& Fox, 325 West
Street, members of the

Meyer

on

Nov^ 6 will admit

Arthur Morton Hill to partnership,
Mr. Hill has been with the firm

pigments,

and

ANGELES, Calif.

Frank,
Eighth

company's
include
*

LOS

for

years.

many

...

M. A. Saari & Co.

S. A. A. Inv. Formed

Opens

LOS ANGELES,

(Special to The financial Chronicle)

A.

CalifMathew
Saari is engaging in a securities

JACKSONVILLE, Fla.—S. A. A.

business from offices at 4040 West

overall return on rate Investments & Securities Co., Inc.
base up to 6.55%. Recently the has been formed with offices in
company
obtained
increases in the Masonic Temple Building to
electric,
gas
and
steam
rates engage in a securities business.
which it is estimated are equiva¬
lent to about 750
a
share after

Beverly Boulevard, under the firm

bring the

allowance

income

let

us

know

your

of corporate

,

&

FOUNDED 1865

Co.

stock

chicago

los angeles

MEMBERS

the

of

=

since

•

RAILROAD

SECURITIES

the

-.

Roderick

associated

istered

.

48 Wall

Street, New York 5, N. Y.

New York Hanseatic

Corporation
'

Established 1920

HAnover 2-7900

NY 1-911

away

dent

of

G.

with

Kellett

them

office

at

is

as

representative
604

G. Fairman,

Angeles.

was

'

Dealers

—

in

a
.

Distributors
Underwriters

now

reg¬

their

Suburban

Jr.,

120

BROADWAY

founder

Fairman

&

and

Co.

Presi¬
of

•

NEW YORK

•

CHICAGO

Los

Boston

Chicago

Philadelphia

•

PHILADELPHIA

Cleveland

Pittsburgh

San Antonio

5, X; Y.

Teletype: NY 1-40-1-2

Telephone: WOrlh 4-2300

Direct Private W ires

passed

Oct. 20 at the age of 67. Mr.

Fairman

_

Associate Member American Stock Exchange

Harry G. Fairman, Jr.
Harry

Bonds & Stocks

Roosevelt & Son founded 1797

BOSTON

Teletype:

Bonds

,

Square Building.

Telephone:

Municipal

Continuing the security business of

W. H, Newhold's Son & Co.; members of the
New York Stock Exchange and
other leading exchanges, announce
that

&

current

With W; H. Newboid's Son

Ardmore

BROADWAY, NEW YORK 4, N. Y.

Co.

Corporate

■;

ARDMORE, Pa.

PUBLIC UTILITY

Co... Mr.

231/2,

1959

industry.

MUNICIPAL

&

selling

was

in

State

on
anticipated
1959
earnings would approximate 14.7,
below the general average for the

Stock Exchange

,

Saari

A.

previously with Toboco

Underwriters & Distributors

but / based

American Stock Exchange

Brokers in

&

M.

was

DICK & MERLE-SMITH

earnings ratio based oh earnings
for Aug.
31 would be over 20,

'

INDUSTRIAL

increase

rate

payout is low in relation to pro
forma earnings. The present price-

Vilas & Hickey
Midicest

the

borhood

crease

New York Stock Exchange

earn¬

in the neigh¬
but more re¬
cently it has advanced to 26^. At
the latter price the yield based on
the 960
dividend rate is about
3.6%; ^however, .it - would, be
logical to expect a dividend in¬

Exchanges

Street, New York 5, N. Y.

philadelphia

Saari

state

and

recent

do equity financing
about a year from now, on per¬
haps
of
l-for-10
basis,
which
would dilute earnings to around
$1.80. Since the price of oil is
now declining, however, it is pos¬
sible that lower operating costs
might make the figure a little
higher.
Before

UMembers T^ew York and cAmerican Stock

of

name

company may

Lynch, Manager, Dealer Relations Department.

Kidder, Peabody

With

neighborhood of $2 a share; how¬
ever, it seems probable that the

securities...
;
'
: '
Through a nation-wide wire system, we provide broad insti¬
tutional and dealer coverage—and cost you less.
We provide facilities for skillful
handling of large blocks with¬
out
disturbing existing street markets.
.

Federal

for

taxes.

ings of $1.30 a share, pro forma
earnings might thus be in the

trading requirements ?

We make primary markets in an extended list of all
types




by the

the

plant

electricity. On the other hand, the

sales have

Problem I

26

for

property,

facturers

Trading

17 Wall

chase

the abnormally warm
weather
during
the
fall
and
winter
months, with
resulting
adverse affects on gas sales and
in a less degree on the sales of

lour

boston

primarily

company

,

V

Address: Mr. David D.

loans and notes were used

.

What is

•

*

ings

use

approximated

*

repay

or

purchased energy was 19% higher
than
in
the
preceding
period

in

not

Glidden

principal
To further point up the
90th
rising fuel costs in the amount.
They are redeemable for Anniversary, Eisele & King, Lib¬
so, since they have the
sinking fund at par.
aire, Stout & Co. has published a
no
automatic adjustment clauses
Glidden, with headquarters in pocket-size booklet giving a cap¬
in rate schedules to protect them.
Cleveland, Ohio, produces paints, sule
history
of
the firm and
In the 12 months ended Aug. 31,

year

increased

politan San Diego area rose to an
all-time high in mid-1958, follow¬
ing nine months of relative eco¬

Why

to

affected by

past year

except perhaps for
and also perhaps
of the Silver Gate

The

last

The

Business activity in the metro¬

to you.

will use the proceeds traditional dinner held at Whyte's
$15,000,000 of outstand¬ Restaurant. ;
Eisele & King, Libaire, Stout &
ing bank loans, to retire $6,000,000
of serial notes and to reimburse Co. traces its. history back to 1868
its treasury funds by about $9,- when Adolphe Libaire and H. B.
000,000. Proceeds from the bank Stout founded separate partner-,

-

first unit at Encina.

rate

years

ful

Highlight of the annual-meeting
underwriting group headed of the partners, executives and
Co., Inc. offered for registered
representatives
of
public sale yesterday (Oct. 29) Eisele & .King, Libaire, Stout &
a new issue of $30,000,000 Glidden
Co., Oct. 23, was the marking of
Co., 4%% sinking fund deben¬ the firm's 90th Anniversary as a
tures, due Nov. 1, 1983 at 99% Wall Street brokerage firm. The
and
accrued
interest, to yield Occasion was celebrated, following
about 4.82% to maturity. / ' the business meeting,- during the;
by Blyth &

advancing equipment. In the

following;

recovering

but

Glidden Debentures

f 1:

An

of 12,364 BTU per
kwh compared with 10,145 for the

reduce

Section.

especially in recent years. In 1946
were only $18 million;
currently they exceed $57 million.
sales

shaving,

:

t

($15,669,000
as
compared
with
of bulk
materials
to
the
food,
$13,207,000),
while- revenues
baking and confectionery indus¬
gained only 9%.
tries.
Another contributing factor in
Glidden's paint division; manu¬
the recent decline in share earn¬

to

revenues

Kilowatt hour

load was
The company should

peak

in kwh sales and revenues,

crease

1957

84 cents

only to drop back to $1.06

1954;

J 956

able to eliminate use of the obso¬

nicipalities

year

-

year,

companies.

other

available

and

commercial sales provide most of

1946 to

sharply to $1.52 in the following,

&

Gas

an

1948, then advancing to. $1.19
1950, but declining to $1.13 in

in

in addition to which 80,000 kw is

the remainder.

tial sales contribute 42%
trical

com¬

and natural gas
" Residen¬

revenues

most of

Diego

92 cents in

from

Electric has
quite adequate generating capac¬
ity. In August this year a 106,000
kw unit went into operation, rais¬
ing total capacity to 662,000 kw,
San

earnings have shown

irregular postwar trend, declining

principal farm products, some of turing companies forecast a grad¬
the land using electric irrigation ual improvement in the level of
pumps. The area is known as the industrial employment during the
"poinsettia capital of the world,'; third and fourth quarters of this
and avocados are also grown ex¬ year. (This data was compiled by
the Union-Tribune Publishing Co.)
tensively.
Electricity

Share

.

Reports

ago.

aircraft firms and other manufac¬

the

Thursday, October 30, 1958

.

Eisele-King Firm's
90th Anniversary

Biyth Group Offers

gas

1958.

1959 were forecast some

tures for

San

of

expended about
construction in

for

about

estimated

is

supply
in

company

$25
1957

sales

than

faster

much

creased

.

.

•

to:

Houston

Portland, Me.

St. Louis

SAN FRANCISCO

■

Los Angeles

Providence

San Francisco

-

■

:

Volume

Number

188

5790

.

The Commercial and Financial Chronicle

.

.

(1789)

Advisory Committee

Mary RoebKng, Gov.

the

Of American Exch.
President

Bank

Mary G. Roebling internationally known fig¬
ure in banking, industrial, cultural
and welfare

fields,

hailed

was

as

"the first lady

McCormick,-;

In

k

o c

an

E

need

Xr

;
;■

the

you

hey;

to

vide

a

signal

of

member

additional

per

share.

sale of
be used to pro¬
electric facilities

and for other corporate

The

company

pany./-

from the

these shares will

woman

a

proceeds

estimates

that

of

its

1958-59 construction program will

your

Roebling has

Mary

firsts to

G.
,

communi¬

is

v/pens
Y.—Nick

N.

conducting

a

securities

rT

«

rities business :frpm,offices at. 211

^

.

East •Second Streef Under the firhx
name of Lawrence A?
Spilman &

ANGELES,

LOS

Calif.—Glore,

Co.;:;

'

;•

f.....

Evans & Co. has been formed with

offices

at

11168

Santa

Monica

Form Statewide Sees.

v

Boulevard to engage in a securi¬
ties business.
Officers are Ben- ;

would

governors

480

Form Glore, Evans & Co.
;

purposes.

.

;C pious
approval. Mrs. •'«

her

Net

indi¬ approximate $153,000,000, of which
approximately $75,000,000 will be
cate
that
there is freedom of
expended in 1958.
.; :i , , ,
thought among you in the matter
: .Florida Power
& Light Co. is
of women in business. This is as now
engaged. only in the electric
it should be." C'-V
utility business and is not in di¬

unaftiir:
vboari ^'v

many

on me a

The selection of

become

board

mar-;:

rnoriyi

gov e

governorship

the

in

oiiKas

™

ties, including Miami, Fort Lau¬
derdale, Coral Gables, West Palm
Beach,
Miami "Beach,
Hialeah,
Hollywood and Daytona Beach. In
L. A. Spilman Forms Firm
August, 1958 the company sold all
of its gas properties to The Hous¬
OTTUMWA, Iowa — Lawrence?
ton Corp.,. a non-affiliated comr
A. Spilman Is engaging in a secu¬

stock of Florida Power &

common

Light Co. at $78.50

Sfikas

service

A

busines from offices at 130 South:
Clinton Avenue.

underwriting group headed
by Merrill Lynch, Pierce Fenner
& Smith and Kidder, Peabody &
Co. yesterday
(Oct. 29) offered
300,000 shares of no par value

ca¬

A ROCHESTER,

electric

An

'

have conferred

honor.

ket's board-ef ;:

wHh'

that

in

serve

rect
competition with any pri¬
vately or publicly owned utility
company.
The company supplies

Light

Common Stock Offered

.

appointment:
to

Florida Power &

Mrs. Roebling stated: "Gentlemen

change Presi4 ?
dent, who an- ^
no u

to

accepting

"

5 t

ever

pacity.-'

T.I

A meric

Women in

on

Shears* 'also widely

philanthropic work
on behalf of religious and chari¬
table
institutions.
Appointed to
the Advisory Committee to the
State
Treasurer
of
New
Jersey
by both Democratic and Republi¬
can
governors,
she is the only
woman

of finance"by

Edward

Services.

known for her

25

jamin Fv Evans, Jr.r President;
Clayton H.; Read, Vice-President
and William R.

.

BOGOTA, N; J.—Frederick R..
Hill and K. M; Hill have formdd!
Statewide Securities Corporations

Glore, Secretary- with offices at 64 West Main St.,
"V.''rV V to engage in a securities business.

Treasurer.

Roebling:

,

credit, but this marks the first

time in history that a woman has
reached
this financial
pinnacle.

Never

in the history of
markets, has a woman
placed on the top policy¬
making board of a national stock
before,

securities
been

exchange.
At

•

fore

:..

induction

an

Works

be¬

ceremony

exchange governors and the

financial

...

:

)

Here

Mr. McCormick
stated: "I am delighted that the
governors have unanimously sup¬
ported my nomination of
Mrs.
Roebling.
Stating it simply, we
have selected Mrs. Roebling for
press,

main

two

her

of

reasons;

first

because

executive

and

stature

ability in the

business field and
secondly because she is a woman.
We welcome this opportunity to

give

recognition

proper

vital

that

role

share-

women

playing in our econ¬

are

owners

Jlstv h.rf..

the

to

■

V'.

omy.

"The American

woman

is today

major influence in the

a

securi¬

ties market and constitutes

jority

a

ma¬

the
shareowning
stockholders out¬
sex until 1952, but
and probably more,

One of the most

important and

for

good telephone

basic

reasons

among

Male

public.

The

research.

is

service

.

/

)

many

ranked the fair

52%,

today
of

our

a

shareholders

nation's

Mrs. Roebling will

women.

in

speed, clarity, dis¬

are

be in

unique position to bring a femi¬
and point of view

nine influence
to

advances

proceedings."
: :
Mrs. Roebling has been chosen
to represent the American public

and convenience would not

tance

have

been

possible without it.

our

the exchange board of gover¬

pn

in this capacity she will
join Dean George Rowland Col¬
nors, and
lins

the

of

York

New

University

Graduate School of Business and

They would not have been possi¬
ble either, in

the

same

degree

economically, without
research
Bell

one

organization such

or as
:

central
the

as

Telephone Laboratories.

Mr. William Zeckendorf of Webb
6

Knapp,

Inc.,

also public

gov¬

This is the research division of the

These governors are relied

ernors.

heavily to bring public re¬
action and thought to board plan¬
ning and discussion.
Mrs. Roe¬
upon

bling will be
part of the

active and voting
32 member board

an

Bell

System.

It has

the

grown as

needs of the nation have grown.

and Hawaii

tists and

engineers

and goes

exploring and developing in '

Mr.

be either associate members

regular member
firms, and the three public gov¬
partners

or

in

directions.

many

covers many

Roebling is the first and

only woman in America to head
a major banking institution.
She
is the widow of the late Sigfried

But it is aimed

primarily at the betterment of
munications services and the

Grandson of Washing¬
Roebling,
builder
of
the
Brooklyn Bridge and other struc¬

of ways to
at the

tures, and assumed her late hus¬
band's

finding

lowest cost to the customer.

just recently, but long

the Bell
ness

and national need for basic

N. J., in 1936. She became Presi¬
dent of the bank in 1937 and is

siderable part

man.

both

President

and

Chair¬

Trenton Trust resources

ex¬

gram

In

addition

to

directorates

trusteeships in nearly

a

score

of

corporate, educational and cul¬
tural institutions, she is the first
and only woman trustee of the
United

States

Council,

of

the

National

Defense

Transportation Association; and is
a

member emeritus of the Defense




across town.

you to

the

new

underseas

telephone Great Britain

Developed by Bell Telephone Laboratories

Made to entirely

new

precision limits by Western Electric.

con¬

pro¬

to this field.

An

the

new

real

the
of

understand¬

ing of nature—the probing into the

brought substantial

BELL

electronic boom and

helped to create business and

jobs in

many

industries. More than

50,000,000 transistors will be made
this year.

breakthroughs in science

come

These

little

only at

rare

in tenuis.

amazing amplifiers, though

larger than

electric

They

knowledge—

our

was

an

The research and

new

unknown"—lias

outstanding example

factors in

has

invention of the Transistor, one

sides!
The "search for

beyond their particular ap¬

signals

can

do

tube

a pea, can

up

to 100,000 times.

many
can

amplify

of the things

do—and

more

They have opened the

a

be¬

way

to

products and improved others.

There is

no

doubt that the Tran¬

sistor has been

one

of the leading

skills of the Bell

at the service

TELEPHONE

manufacturing

System, already

ganized and at hand,

are

or¬

placed fully

of the U. S. Govern¬

ment whenever we arc

called upon

for

we are spe¬

projects for which

cially qualified.
Among

many

signments

;

present defense

as¬

is the development of

guidance systems for intercontinen¬
tal missiles.

Interna¬

tional Chamber of Commerce; the
first and only woman Vice-Presi¬
dent

call

plication to communications.

vacuum

the effort to increase
or

a

of its laboratories

panded from $17 million to over

$90 million during her tenure.

as you

of research.

ago

System recognized the busi¬

research and it has devoted

now

Director

as

clearly

com¬

provide this better service

of the
Trenton Trust Company, Trenton,
post

benefits

tli at

Not

Roebling,

ton

of the repeater units in

one

fields

ernors.

Mrs.

This is

The work of its hundreds of scien¬

McCormick,
15
regular members of the exchange,
12
non-regular
members,
who
may

as

after many years

which consists of James R. Dyer,

Chairman,

RELAYS VOICES UNDER THE SEAS.

telephone cables. These voice boosters make it possible for

SYSTEM

>

20

The Commercial and Financial Chronicle

(1790)

Continued from first page

xmcf
vast

Yet

such matters

requisite for the task—to have the: temerity '"readily understood br appreciated
people with the real facts. We heed ^statesmen, ■ by the public. '' It is-also.usefuI m
politicians, in sufficient numbers to begin the-xtrettifcn.-v? the. case of smaller;issues where:

not

dous task of settine us hack on one intelI, iti.at W ..ho.ri
getting us back oh our intellectual ifeet about,

economics and economic

exemption

of

outlays. It

was

of the national debt follows the
pattern
was less two billion in 1.914. World War I

drastically, but by 1929 conservative ad¬

figure to nearly 260 billion.
Today it is higher than that, not lower, by some 17 billion
and doubtless will be
appreciably higher still by the end
of the current fiscal
year. Of course, the country has been
getting bigger through these years, but population growth
has failed by a wide
margin to keep pace with these out¬
lays of the national government—or with the indebted¬
the

of the

nation, which incidentally is much greater than
figures ordinarily quoted would indicate.

that these

we as

is to

answer

so

our

our

affairs

current

it. It is not

state

saving? To ask the question
only the Federal Government, but

and local
governments, many types of business and
Very nearly all individuals that have taken this road to
more

and

ever

more

two.

So far

indebtedness in the past decade

or

the Federal Government is
concerned, let
it be noted that the commercial
banks of the
country in
.

as

1914 held only

some

$818 million of United

States Govern¬

ment

obligations while other assets, chiefly loans, came to
about $16 billion. Even in 1929 when the
national debt
-had grown to
nearly $17 billion less than five billion was
held by the commercial

far from
tmanagqg.
j

v

banking system which had not "
50 billion in total earning assets. The New Deal c
to get more than $15 billion in government se-

curitiei^nto the commercial banks by 1939 despite the fact
that total assets declined about 10 billion during the dec¬
ade. Of course, enormous increases in
government hold-

tings occurred during the war, and while some
progress
has been made in
getting the debt into other hands, nearly
$65 billion of it still remained with the commercial banks
'




which?

rf"#1-

is

r> ww rt

.

J

»-*

compelled

to

/s

:

the

-

undertaken

ing
*

>v

these

by
assist

We

methods.

other

issuers

in

placing their debt securities privately and we participate in the
underwriting of publicly offered
industrial

the

all

of

negotiated ; issues {primarily
companies) which

material

of
are

managed by ourselves, as well as
those managed by others,

volves the services of counsel for

Call

,

Protection

and -V

Bond

on

Debenture Issues
issuer, counsel for the' purchasers, accountants, etc., and, in
A fairly recent;.development in
many cases, investment bankers.' the field of corporate finance has
A public offering may -require a ?been the desire on the'part of
somewhat longer time .schedule Certain institutional investors for
than a private sale
although' this t some sort of call protection on

the

„

:

^

J.

J

_

J.

ji

.

*

-

:

the

of

less

involved.

are

necessary documents. This in-

been made and that such transac-

violation

'

thatt

facts; to solicit interest of prospective buyers; and to draft the

might not,, decide subseT
quently that a publie.offering had
thus

effort

and

••

presentation

courts

tion

contention

analysis of this argument in-,
can be over-stressed- In
most private, as in public offerings, it is necessary to prepare-a

^

wonder:) if

•:

The

dicates it

tutions buy a nonregistered issue,
1%
as has
happened on occasion, one
■

;V;

may create no* misconcep¬
tions, I might point out that our
firm, while pre-eminent in the
field of bidding competitively for
public- utility and railroad debt
securities, is also active in finance

An

only one or relatively few ^purchasers, when more than. 50-instie%

established

6t

In order that my previous com¬

paralleled rather than

are

(3)
time

answers

is not

always the casb.v"It would " bond and debenture issues. This
that most well managed tor- stems from- the
experience
of
are in a-position- to?aiw
many institutions which had pur-i
saw
onintended,that the. financing ticipate their financial peeds well- chased, certain bond issues at atundertaken pursuant to this sec- enough in advance to allow time
tractive terms when interest rates
tinn nf thp Act wnnM t/rn«f ^
tion of the Ant would grovtf to its for the registration process.
~were
high in: mid-1953 only to
present proportions. According to
(4)
The facility in '.effecting have the bonds taken
away from
was

a

Securities Act.
doubtful

that

Furthermore, it is

the

Congress

fore-

figures prepared by the Securities
and Exchange Commission

ing

the

24

through

-

1957,

proceeds

of

cover¬

period

year

the

1934

annual

public

gross

offerings*-- of

seem

porations

changes, such as indenture .pro- them
through " refunding opera-'
YW
-apse**; ■
tions during the following year
White customarily machinery is '
wtien money rates eased,
provided for effecting changes in- •

licly held

it

simpler to contact

billion and

than

during the

period

same

Private Placements have averaged
about $1.8 billion.
For*the year
1957 the figures were $6.1- billion
and $3.8 billion, respectively.

Private Placement Arguments
Let

us

examine

of

.some

principal considerations

or

argu¬

ments which may have'influenced:
the decision of some managements

to sell their securities

placement.

\

(1) There

may

officers

be

by private

Securities

an

directors

to

Act.

These liabilities could arise from
an

untrue statement

state

a

or

failure

to

material fact in the regis¬

tration statement. While any tend¬
ency to avoid personal liability is
readily understandable, the whole¬
some

effect

the

of

disclosure

re¬

quirements of the Securities Act is

widely recognized. This is partic¬
ularly true in the case of those
companies vested with a public
interest through wide ownership
of stock

or

by virtue of the nature

of their businesses..

(2)
due

The

avoidance

of

..

.

expense

ithis advantage, if
quickly if even
a
slightly better price can be ob¬
tained through public offering. As
matter

cases

of

fact,

in

connection

with private placements there are
often incurred many items of ex¬
pense
such as printing of con¬
tracts, indentures and other docu¬

ments

which

are,,

the

would be involved in

fering.

Thus,

in

^ "V.-

.

which

are "other

tend

to .jnake'this

corporate managements,

a

fact,

same

as

public of¬
many

ex-

made

.

.

.

are

bargainers

.

of

kets for

access

their

depriving

a

securities^

an

For

this

market for its

open

•

not

The

--

at

se¬

method

locked

issue is not

an

:

up

at

savings due to changes in

terest
have

rates.
saved

reacquiring
open

C.

issuer

Donds

in

;c; * \;

their

market.
The

^

runs

being burdened with
denture
A

in¬

Some" corporations
of dollars in

millions

provisions.

*

-

of

in¬
^

-

single purchaser or small
group of purchasers is "in a strong
position to dictate the provisions
of a privately placed issue. Their

or

Securities

Commission

Power

Not -infrequently

-

some

or

not

and

Commission

we

are

asked

potential issuers whether

we

recommend

would

the

such restrictive
call, features.- While obviously an
incorporation
issue

which

of

non-callable

is

non-refundable

for

or

is

period

a

easier to sell under certain market

conditions,

the, risk
onerous

-

the

it and The

Federal

by

few buyers there

should be
opportunities for the 'isuer to buv
a

vears

eta have cau protection features in
lheir recent debt issues,

sinking fund or other-purposes
savings. If at. least

substantial

part of

10

run

have pursued the policy of not
authorizing debt issues of com¬
panies subject-to their respective
jurisdictions
if such provisions
are
proposed. However, some
utility companies not subject to
the jurisdiction of these agencies

forfeits the possibil¬
ity of later acquiring its securities
lor

like

pnd,T Exchange

thing, the issuer using

one

few-cases,
longer.

fafn quarters. Some managements

rr-,

.w-

a

Understandably there Lave been
objections to this practice in cer-*

B. The private placement -de¬
prives the issuer of certain bene¬

curities.

borrowed

in question. Such call protec-

even

them
v

monies

with

that-that represented by the

period of at least five years and;

in

broader-mar¬

to

is

tion features generally extend for

se-

^9 take advantage of the Jact that
are.

f.u{:

lower interest cost to the is-

a

sue

usually experienced
who are anxious to

issuers

it
ik

price which it received for the is-

—

..

they can for
them respective institutions. Quite
naturally, many of them .Will seek

fits of

non-callable
iiuzi-cctiJictijie

non-refundable, it cannot be

redeemed
at

8uer

make the best trades

selves

specific periods. If

made
Jiiaoe

_

th|Sie]iirc:

#

the

is
is

...

'
^de<?uacy ! '£Pric:e,.*ff~
celvec! by the issuer is frequently
0t'rp'j1.10,['
The buyers of
j,

issue
'sisutJ

"an
«ri

a<Jvancgddn*fa^<riyte^"6'^i^^"^^iaW
theie
pos
during that per od.

placements

financing method less attractive to

,
i

order

the

JnaUing Sone of the. now debt
refundable for

back its bonds in the opeivmarket

any, can evaporate

a

i

be

vate

with

to registration.

In most

may

•

of

issues either non-callable or non-

Opposing Arguments

cunties

desire by

and

few-holders

**

l

demands

there

r*

•v

unregistered

-yZ-

a

the

.obviously

is

a

many.

factors

the

issues

to meet
:institutions)
developed the practice

Accordingly,' in

the indenture provisions pf,.pub-

corporate bonds, notes and deben¬
tures have; averaged about $2*4

avoid possible liabilities under the

managed

increases in the national debt could

enormous

be absorbed from

individuals

adjudication

issuer's

Saving Far Outstripped

Now, have

penses

avoided.

.

ministrations had got it down to less than 17 billion. Then
came the New Deal which ran it
up to more than 45 bil¬
lion. World War II lifted the

ness

is

registration

satisfactorily
fob? alF cases
the
problem of what.constitutes a private placement,,as opposed
to a
public offering. While the majority of nonregistered issues have

to less than

managements

their securities. y

Financing Piocednres

from

not

nal

course

caused it to rise

\

transactions.'by an isinvolving, any public.oflenng. To my knowledge there
has never been a regulation or fi-

spending less than three and a half
billion a year. By the time a second world war descended
upon us, these outlays had risen to more than eight and
three-quarter billion. Outlays rose to some 98 and a half
billipn during World War II, and it seemed to the ordinary
man that one of the most
urgent postwar tasks was to get
these expenditures down again somewhere within reason.
Yet in the fiscal year 1958
they amounted to nearly 72
billion—«13 years after the end of hostilities — and are
moving up again all too rapidly.
The

the

enterprises who have "the latitude
of choice, should consider care¬
; fully all aspects of. the problem
before" deciding between
public
offering and private placement of

granted to

suer

bitter and destructive world war, our Fed¬

a

eral Government

Hoover;

;*r:~

ments

Bond

three-quarters of a billion dollars—as hard as the fact is
to believe or comprehend in this day and time. Even a
decade after

from page" 6i;;

i,

policy.

Current Bond Market Trends and

could still join a union or refuse to do so, and
and there would his decision interfere with his

came

the irh-:

I do not wish to convey

pression of arguing against the
practice of private placement hi
its entirety. .Oh the contrary, I

to face the

Continued

> ,

company's

.

.

what we see with what existed before this coun¬
try went half-socialist—the decades when it was carving
out for itself a place in the world which is still the envy
of peoples almost everywhere else on the globe.

tide of collectivism in

a

as it were, by the fallacies of the New^Dehl that
apparently does .not. see for itself the horrible dahger. "ff manylnstJnwsv It is of particu-i
that lurks in conditions of this sort. So
long as -the public
lar" value in helping to" develop
remains in this condition, few
politicians are likelvr—-even':? new ventures and in siipplyifig the
if they had the independence of mind and the
lnsi^htdnto
SKi

Franklin Roosevelt. We need rather to look about us and

Total Federal expenditures in 1914

an

hamper

can

operattdns.

it

compare

Europe and elsewhere, but a man
only here
ability to
obtain work. The great rank and file were not obliged to
pay through the nose for the exactions of labor monopolies
in giant industries. A man with energy, ambition and
requisite shrewdness could amass a fortune roughly pro¬
portionate to his economic contribution to the country.
Such geniuses were not obliged to work most of their time
for Uncle Sam and possibly also for the state in which he
lived/ Relatively speaking businessmen conducted their
affairs as their own judgments directed. The economic
consequences of changes that have now taken place in
these areas are almost beyond estimate.
,
w

visions.

during the entire campaign that is now
end, do we find any frank recognition of this

washed,"

plainly

campaigners are doing so or have any inten¬
tion of doing so. The real issues are not to be found by
comparing the Administrations of Mr. Truman and Mr.
Eisenhower, or even the current regime with those of

/

Thursday, October 30, 1958

thv^yc0Sebredralrable

where

coming to

of the

In 1914, the year in which World War I broke upon the
world, we were a free people—really free in the sense in
which Adam Smith and his political contemporaries used
the term. Some concessions had been made to the rising

0f

now

state of affairs? Of course, we can find it
practically nowhere. And that is not all. The public has been so "brain-

It would be well if the voter would take the time now

review the facts for himself—since

amnnnt
amount

and
full

situations.

Voters Beware!

to

.

And, of course, money, supply
natural tendency is to impose
stands at upward of $232 bilto Secure
measure of New Deal doghia and .ar-; their institutions' investment. In
naivete. to
find
soundness''iliv these
some
cases these restrictive pro¬

has grown apace,
lion. It requires a

inspired with true Americanism appealing to the voters
this autumn, the outlook would be less disheartening!

none

.

at the middle of this year.

-

[As We See It

and then

.

we

do

not think

it

is

sound business judgment for managements
to
relinquish
control
over

their

debt

unless

solutely- necessary
prefer

to

see

to

it

do

some

is

ab¬

so.

We
of

sort

"sweetening" of call prices for
period such as five

years

a

as com-

Volume

pensatioiv to

~

.

-

the investor

(1791)

should^ Continued from page 6

course in
"current affairs" ganizations
with
which ..I-,am
political science should be a officially connected, the National
required subject for all students Municipal League, the Institute of
or

iBteryal.-rWei tbhik that

•„

>.

inanage^ ..;,j

should- ^iyfr : eonsideratiom-K
this - in preferehcetobemg^ . v
preyentedfrom retiring their debT^^i^^

instead of

to

^

"

ihat there

r,

certaitv

are

,instances, A^eii it is necessary to.
accede to; tbe;;wishes of ; the >buy-

.

,

_

.

.

..

course

as

today.

it

;

jl have had some ; hesitancy ih
Voicing these; views as I make no

^ ^

„.

selected

a

is in many cases
.

-1? at^hy^tinier; However; it ipust-'JJ
"

claim to special knowledge in this
no desire to- be

field and I have

..

tke ,s&le of ,general obligations, price spiral and its serious threat critical of the teaching profession,
sometimes erroneously entitled to; the: public interest?
for which I have a profound re-'
uReyenue'; issues, is impressive; :1 (3) Tlie seductive claims' made spect and admiration.
Jt.has
J^ears, Roebuck & Co.; Debentures, ^0 1954 the total was over $3.2 :. by the: advocates of more money seemed to me not inappropriate,
it was obvious to the Managers* of billion arid in 4957 over $2; billion • ^aiidCheap credit mislead many
however,, to give some direct at¬
whichsOiir, firni was one; of the;, or 46%and 29%, respectively,.pi* well Pieaning adult people. Is the tention to our school and educa¬
underwriting syndicate that a. so-, oil tax iexqmpt financing during riskkiherent in this concept es- tional objectives in view of the
called,.non-refunding feature was the,/ yearsin question.
s
pecially in boom times, under- fact that they represent such an
important. This was because the
:prii«n*» fnr c^hAni
stood -by our on-coming genera- important part of our state and
yery unusualmagnitude of the
imnrnvpLnU
tiOn so that sound positions and local government expenditures. If
For: instance, in the
(he recent ; issue of ..$350

ers.

:

,

of

case

millio^

,

„

issue required. the; enlisting of in-

;

;

leadership

*

Public

Administration,.;, and

Citizens

Budget

the

Commission

of

New York City. Iri addition, there
is a world of information that can;
be made available in the field of
economics

concerning the faets of

inflation and the factors that en¬
courage
or
retard its
While honest opinions
on

how

progress.
vary

can

best to deal with

mone¬

tary, pricing, labor, and related
problems, an informed approach
by this important group, of our
citizenship is an objective that
Should have generous endorse¬
ment.

'

', 'V

;

Some

be expected in the it turns put that I have been able

"

contend that .these
to make a constructive suggestion
thev part of as many.
questions get into the
lent ^are
realm of politics and therefore
'siubtected to r" " *
or two, I shall be sincerely grati¬
as
.
W Many people, ar* not really
public institutions should not at¬
V'
' ■.
^'
uyally, the higher interest rates so
f>' "-^^V^ concerned about the danger of In- fied.
inthe mpre the investing institutions - Stbupsy they piust decide_on PVh- fiation^ Thev hnvp little nnrlprmore the
Conclusion
tempt • to take sides#If the sub-*
institutions
h,
Hation." They have little underwiH want call
I will admit that I have no di¬ jects under discussion are dealt
Prote^pnstanding of the fact that creeping
with on a factual basis afid deci¬
conversely, when and if interest
an
inf)ation could eventually develop rect knowledge of the specific
sions are reached on the merits of
fate?
Into a" gallop or that repeated conditions applying in North and the facts at
this, subject will wane.
hand, political con¬
Df siow
inflation
over
a
South Carolina educational insti¬
J
-*■
»
* weuar^ ana stability, out on me , <joses
national economy as well,
u
•
vi mvw limauun over a
period of yearsr will result in a tutions. As I have thought about siderations should not mflu^iee
"When to Borrow
the judgments made; The indiyjet*
:
°f:^the. most persuasive substantial cut* in. the value of this matter, however, it has oc¬
In
discussing their, financing pressure groups is the school or thbir savings and insurance. Are curred to me that high schools uals concerned will soon enough
plans, we aresometimes, asked by educational, advocates. They rep- many of our young people secur- and universities in this area could: have to take positions oi» public
company
managements
if ,they resent acause that is essential ing the type ox education that de- secure from both the Local Gov¬ questions and deal individually
would,, be welt;advised to. take. and one in which all good citizens velops: their. ability* to
j
M
Commission
and
the with political Opinions.
think ernment
advahtaige: "of; the then current have a k?en interest. Their cause clearly fori themselves on pressing North Carolina Municipal Council
Whether there is general agree¬
ment with the suggestions & hafe
ih^et';^
their^ financing is uhte^dabfy well su^
distin- a great deal of useful information
urntir sopie ^listcht date, , such as, On owasipns. these groups develop
guished Jrom book, traditional or which might be used advanta-> made is not important. I do hope
six, months br^niore, when funds a fervor which is impressiveand memorized
that they may stimulate thinking
knowledge?
"
geously in civie or political science
are
actuairy,yeguired, It has beenfrequently, their efforts are effec- 7. >. ^ •. ' •
,;
courses.
Such information would on this subj ect and be productive
j

-

^

t

As

011

local

our

,

.

,

,

of

units
.

govern...

,

can

future?

possible Nat-' »«nt ^ ^ccteA
1^"™ tlrae

fSSregaW mayteve
^^;their cpncern^ith^^l^^^

may

economic

p^"ns'

important

Po^'^al buyers

,

.

,

.

T

'

,,s

27

basic

merits;

-

i

,

The Commercial and Financial Chronicle

...

the bonds be reiunded

.

•-

Number 5790

188

•

*

-

*

...

■,

.

tfe

-

y...

„

•

.

bur

Major Importance of Education
have the advantage of presenting
; ^ In Nation
specific problems of an operating
ftjMr Individual bases or ■ :demap<Js / yAs bbnkbhs! ;a nd then dealing in and fiscal nature and- the solu¬

sometimes! live.

observation; that

xvheri

cpmpatiy borrows too far
-in;; advance It''finds it could .have
a

Annce 1"t

Vio+f/i.iv

'

'lirhatnii

hi/

Because it is such- a good
does ;riot mean, however,

cause

shnil 1/1 * rfihrl'

-

sVihtpni

hn

,inft'refiil

fri

<

JL-u7

-

of good.

With Lester, Ryons

—;

tions

that

could

be

have

used

been

in

found;j It

promoting

a

interest in the processes
of state and local government on

broader

(Special to Tjik Financial Cmronjcle>

;

LOS ANGELES, Calif. —Fred¬
erick M. Swenson has become as¬

sociated with Lester, Ryons & Co.,
the part of our high school and
vy*vi
vuwiviiyu yi
jjuatpvucvi
:
7T«
.Tv
T\"-<'■ 7-X:j!'vo. n.uiuf icciii
ciwivus,
we
nave
623 South Hope Street, members
financihg plans by resorting to sUriugT ^ts .mfectivenessv
; ehly i-easbh te be proud of the eduea- college graduates, who are just
of the New York and Pacific Coast
temporary
borrowings
only
tor in terms of physical plarit,. but fional facilities that are provided reaching voting age.
Stock Exchanges.
find that the ultimate financing m substantive content as well.
by the various state and local
There are many other organiza¬
costs are greater than the terms,
i?.
governments and
the
generous tions
throughout the country that
which they, could have,
Samuel Franklin Adds
pbtaihed.prftrrams ^
.
^mpnpey, in which the public has would be prepared to give similar
hi; ttie^--first instance. Tn general;
:
responded to this need. As indi- assistance; I am thinking of The
(Special to The Financial. Chronicle)
it is our advice tb managernehts.
Let me_cite a particular area cated above, it represents the Municipal Finance Officers Asso¬
LOS ANGELES) Calif.—Herman
to borrow when and as money is which* holds, a special significance, largest cause for public expendiciation of the United States and J. Houle, Jr. has become' con¬
peeded and to pay the rate which The major fiscal problem on ha- tare.
Canada, The "American Municipal nected with Samuel B. Franklin
the
bond
market
is, JioM scei^ today is the creeping
indicates
: A./Freeman, Vice-Presi- Association, The Government Af¬ &
Company, *215 West Seventh
proper at the time of
borrdwingV'^Shermrni ^ent hf 'thb;Institute for Social fairs* Foundation, and three or- Street,
\

•

-

T

,

,

-

,

„

.

^-JToil^v-TruS4o^
,

LOS

ors

ANGELES

Calif -Trust-

Corporation has been formed

With offiees at 540()< Wilshire Bou-

levard

to

business:
;.

nisonr

engage
Gfficers

chairman

in
arc

a

Associa-

:

-

Or¬

alniosl'45

•

educating the younger generation

securities

on

Derinv^rien-

of

Sciesnce^ Re^arcH/Iias stated \

lhat
million pertion, in a recent .speech raised sons» phe-fourth of the Nation,
the issue of what kind of a job
^"rol ecl 111 educatlonal instlour .sehoolsj are doingtodayiiriutions-^^.^
.

f";:; the Ambnean"-Bankers

the'

boart;'
Manuel J. Felix, Presidenti Jack

.

thrs

and

,,

related

economic

<J^s«®ns' .s». t|'«t they m».v vol..
W.sely and .ntell,gently on -t-

Swdenis

aie

1958 REVISED EDITION

"^out of five ofstate
our
enioiiect in

OVER-THE-COUNTER

c°ntro®f-HwoV
emneJ^u^ two S onll

Common Stocks

education;
employees of

On Which

Smithy Barney Adds

dents major in [economics or that

in^nat^naL defense^ seiv^ce anc^

CONSECUTIVE CASH DIVIDENDS

;

■ Joseph.u pivlsj Jii; Wllliani: D;
Knauss,. and Wiliam E. Rex have culations
become associated*-with smith;

Barney & Co.

as

registered

repre-.

are

^ntat^esto.the52aFlfth Avenue/
•

hrfr larger economic

on

^ve?thlless

-

significance

questions,

students.
At
this age our yobth are approaching" maturity and they should be

Frank.L. Walker. Adds
(Special to The Financial Chronicle)

MARIETTA, Ohio - Harold
Miller and James B. MunneU
associated

now

with

'ot

for .al™^V ha,f
state and
local Public payrolls.
• *; that the proportion of young

school

which should bS understood by at

?

„

the

least

New- \ork City, offiee.

S

simple and fundamental

some

high

Si

qX?^-"'it

^ ^nd

of:

Den6itureS

local government
are

education

-60

Dr.

Adams, he-states: "A strong
is today essential to our

economy

With Bache & Co*

national welfare

If

our

strengtn weie to be sapped either
to be
eitner

(Special totee Financial Chronicle)

BEVERLY HILLS. Calif.—Stuart J. Malone has become affiliated with Bache & Co., 445 North

of

pression, the safety of

1 to 199

aJ?"f

200 up_—

Tne

questions

.

economic

Si-mld

strength wlre

•

-

^

•

^
I have cited

flaY? J"®

are

'

®

suggest that a more

constructive approach in the educational

procesa

may

ihpennit*rt emphasis in certain
the United
wixi1

States and the .entire free world

^

vipw

analyze^

trv aiding

and

be

-'sayssBsr.s.fa

(SBccwto.TKPm^cui.CK.oNKx.)

thought-provoking

HILLS, Calif.—Arn-

old B. London has ioined the ctaff
of Toboco &

Co

Inc

9235

•

Wil-

■^

,

,

slIPP f

fiulstions:

given

in

*

-

-

f

improve

(Special to the Financial Chronicle)

LOS

C.

has-< become

First

California

'<

connected

Company;

Incorporated, 647 .South ^Spring
Street, He-was formerly with Hill;
Richards & Co.




economic

(2) Today
.

ANGELES,. Calif.Bruce

Dunn

with

the

are

imbedded ;

which
times

push
and

in

ptices
orevent

our
up

«s

many .teachers or inany Mhools
hbWever,

as

to whether or

not

in
some
of
our
by the administrative of-

^follow-up"

biases and procedures to give assurance

economy of satisfying average results. It
in good may be that something like the

nrices

•

from

,

cance

signifi-

of this trend of the wage-

100

Or

more,

your

firm's

printed on the front cover with the words
Of"

name

•

Will

be

"Compliments

above it without further charge.

Chronicle

25 Park Place, New York 7, N. Y.

Please enter our order for

booklets of "The Over-the-

Counter Market—Where All Securities Can Be
Most of Them Are" and

Traded and

accompanying dividend

tables.

Firm Name

Address

—

"Case Problem" method- of teach—

"v,;.ing, which has proved so effective
f readjusting downward. Do a(; tbe Harvard Business School,
studeptsLjmderstarid the

of

Wm. B. Dana Co., Publishers

ficers regarding teaching methods

inflationary

orders

Commercial & Financial

literacy of , schools

the American people?

p' ci ralifnFnia
virsi v^anrornia

uuiiis

Jeg® leveJ1' that Wl1.1 effectively

On

the abilitv

ghire'.Boifclevani*-"He;'wasvform6Hy-^i?52^^5 ''5j^-'"^?ff!,^f£S^fe*-t:h^a».iis'^adequate' insistence and

With H. CarroU & Co *

.

29 cents each

.-#.*15 eents each-

formulating

erlearnine fn meeting question is raised,
stud^nte A the ?ad.m
these desirable obstuaenis learning ine jectives. The

^acis today at the high

—

teaching areas

=s,w.Kr:w:s=rs.
BEVERLY

BOOKLET

COST OF THESE BOOKLETS

weMare, health and

^K

PACE

ex-

high-

hospitals, in that order. Education

w

Frank

Mimtk.

5 to 174 Years

aw,™.

Laiif«me

W,
are

Walker; & Co., Peoples Bank Bldg;

;

Have Been Paid From

need

to

be

given wider ap-

plication." It may be also that a

By

..Date

————

.

28

The Commercial and Financial Chronicle

(1792)

Continued

forcing causes many strong
complaints,
another
much
less
much

harmful

more

forcing of con¬
prevails.
The follow¬

ing brings this out: "the stealing
by
a
government
and central
banking system from people's sav¬
ings through the issuance of bills
of
credit
which they refuse to
redeem in a standard of metallic

fraudulent

"equivalent amounts
pp. 337 Et

dollars."—48. Stat.,

in

Seq.

•'

■

By a statute of long standing
unit of money was called dol¬

our

contained

This standard coin

lar.
23.22

of
grains of alloy.
grains

since

Then, as

Constitution

our

2.58
always

gold,

pure

adopt¬

was

ed, there existed no right by our
to deny redemption

Government

important to remember, also, that often, instead of coin, bullion was
the medium for redemption.
Ob¬
reducing the gold unit's content
24 years ago was an impairing of viously the only requirement was
that its gold weight should equal
the obligation of contracts, a vio¬
lation of the Constitution because

Congress

not given

was

the

right to do this.
Some conception of the stealing
referred to may be had by

reading

the

following by the exceedingly
high authority, the Editorial Staff,
American Institute for Economic
Research, in "Current Economic
Trends," June, 1957 on page 31:
"Another effect of the great infla¬
has

tion

been

subtly

shift

to

wealth from the accumulated

sav¬

ings of the people to that avail¬
use.
About $160,-

able for current

€00,000,000 has been thus 'stolen'
from the life insurance, savings
deposits, and other fixed dollarvalue holdings of many individu¬
als

transferred

and

current

to

others for

spending."

Under date of March 1,1958, the
Institbte published "Research Re¬

that

of

dollar

our

not

justify a dis¬
our policy as to Silver
policy made confusing

article

cussion of
a

do

by "New Deal" laws and fiats.

life

insurance

and

savings

bonds, savings deposits, etc. since

Today

-

.

The name, dollar, correctly ap¬
plied today, designates our present
standard
coin, a coin of 13.714

such

the

cases

use

of

all

bullion

is

satisfactory,

passing, we should observe
that, when, in 1934, the gold conlent of

is far

In

standard unit

our

measure

more

marked in the follow¬

of money was

ing mentioned activity:

was

ernment

lowered, this change
expected correctly to contrib¬

Our Gov¬

Exchange

Now,

as

still

in the recent past,

policies

as

change

are

to

our

medium of

our

being employed in

How simple and

the
of

a

A

general

Popular
in

to

"Look

thinking

markets

to

be

advanced

animal tanned

an

dressed

for

As

use.

other¬

or

money

money.

land, for

and
general, and as little neg¬
lected, is the understanding of

the

New

the nature of substance after sub¬
stance. No excuse is to be found
for

the evil complained of here.
Money is metallic coin and noth¬

ing else.

At the time of the Con¬

vention

in

so

Philadelphia

defined and had

money

no

other

definition.
The
money

lawful

is

power

granted in

ever

the

power

over

Con¬

our

to

borrow

money, on the credit of the United

States; to coin money, regulate the
value (that is, the degree of sub¬
stance), thereof, and of foreign
coin; and to provide for punish¬
ment of

counterfeiting the current

of

the

Congress

United

States.

The

borrows

Deal

Yet, throughout
long lime before
such

not

was

the

case.

"The

ordinary

thinks in
but is quite

man

now

subject

merce.'

enty

by

George

F.

To

"look

round

little"

a

is

to

grasp Mr. Hepburn's definition of
real money and hence

Government's
tation.

great

our

Federal

misrepresen¬

Since the "New Deal," the

dollar

does its work

now

of

the

'

Another

Source

of

Confusion

Another

source

of

confusion

assertion

of

gold

a

that

standard

regulator

the

consider

gold standard to be

is

advocates

the

automatic

an

which,

when at work,
"inflationary
ex¬
pansion of the money supply."—
would

check

Gold

Future'." in United Business

Standard

Past, Pres¬

—

Service (210 Newberry St., Boston

16, Jan. 14, 1952.)
•

"There

comes

time

a

under

a

the

country have originated
chasing power in excess of

pur¬

that
required to represent goods pro¬
duced (including form, place and
time values) which arc currently
coming to market."
Here

the

should remember that

we

reference

here

mercial bank

is

to

a

com¬

commercial de¬

or a

As

the

to

credit

situation

arising

expansion

had

in

pre¬

a

happenings: First, the plac¬
the hands of individuals

ing

in

and businesses of

ing

power

used

to

kind

or

of

the

purchase

purchas¬

course,

goods

was

of

one

another; second, because
absence

the

ance

excess

which, of

Of

excess,

a

goods

to

bidding

bal¬

up

by

This

last observation has been made by

quoted for the

same

book

character of

consequences.
evidence is sufficient

The

extremely

highly

that

qualified

[the gold standard]
inflationary expansion

regulator

work,

deposit credits

at
of

and

paper

prom¬

of

reserves

sudden

will provide against

as

and

temporary,

unexpected,
depreciation

if

even

for

well chosen.

In this matter history has

given
During most

helpful lesson.

a

of the two and

fraction centuries

a

ending in 1914 much good bank¬
ing was practiced
in England.
Throughout that time the required
amount of

to

not

bank's

a

have

been

reserve seems

hard to

deter¬

and 40%

of its paper currency.

Today,
System's

Federal
Reserve
so-called reserves
are
misnamed. .They are not things
held

our

Since

we

cannot have redeemabil-

ity except

aforestated, the socalled reserve "requirement may
as

reduced

be

without

the

fear

of

Rex

Robinson

and

The

Herbert

Commercial

Financial

Chronicle, May 10, 1951.
Obviously, this "requirement"
may be
raised for manipulation
purposes.

The limited scope of this article
forbids

nal, June 30, 1958, is the following:

volved

the

transferring

to

all others is characterized

lows:

understanding

of

money,

real

money.

"Richard Henry Lee, writing to

at the outset
the Constitutional Convention

gold. This Act authorized "in

May 15, 1787, said: 'Knaves

ment" credits in the

pay-

Treasury De¬




and

are

been

as

the

Mason,

fools

believe

that

of

allowed

to

con¬

on

assure

calling

to

pay

United States promises
money
to
the
bullion

equivalent

in

The

for

"As

Wall Street Jour¬

the

future,

fol¬

noted,

vert their

the
United States the title to all seized

George

former

has

As

exchange value of
money, real money, gold coin at
the rate of $35 T per fine ounce.
All others (institutions as well as

the

to

".

.

follow:

Some

.

quality

general medium of
wanted to be the

is
of

everything; and this
belongs to metal,

no more

than it does to
when

asset is both old

Some observations

erroneous.

exchange

this

but

economy,
an

from the past

the

stocks and paper,
of them is

circulation

Only two years after the above
appeared, published was The
Wealth
of Nations, by the re¬
nowned

R.

and

treatment

to the

and

Smith.

Adam

On

pages

gold withdrawals and insufficient 363-369, Book V (P. F. Collier and
gold holdings." The Federal Debt- Son, M. C. M. I) appears the fol¬
Vehicle of Inflation?, by Leland
lowing:

the

as

Observations From the Past

Many well known economists
today call Government debt an

in

theory of paper money
deemphasized in his

confusion is widespread

percentage

as

has

of foreign central
foreign governments and

a

readiness for use.
Used supported by the credit and good
"accounting devices," they faith,- and by the interest they
cannot be said to be kept in such produce." An Essay on Circulation
form as to meet all instant de¬ and Credit in Four Parts, and a
mands upon them.
The authori¬ Letter on the Jealousie of Com¬
ties
of
the {System,
instead of merce. From the French of Monavoiding this evil, exert their s'eur■ Isaac DePinto, Translated,
powers of so using reserves as to With Annotations, by the Rev. S.
Printed
help the banks to expand or to Baggs, Ml. A.—London.
contract the exchange media sup¬ for J. Ridley, in St. James Street.
ply. How easily they do this. MDCCLXXIV, Page 126.

only

provides for punishment of

or

small

c£
unwise
borrowing. Only 3% of it would
equal the loans for stock specula¬
tion on margin in 1929, and we
suspect that even more may have
been unwisely inquired."

measure

numerous

banks

($300,000,000,000 since 1945)

includes

vulnerable loans reflecting

asset

money
supply
would
be
checked." — The
Gold
Standard,

daily practice with the result that

huge total of
incurred in recent

conception of

in¬
gold coin
standard,
the
Federal
Reserve
System
had
little
incentive
to
change its rule of keeping in re¬
serve 35% of its deposit liabilities

reminding the reader of
other specific ugly in¬
fluences
upon banking
reserves.
quoted from above.
Dr.
Spahr Yet news commentary after news
says: "The quotation should have commentary shows the popularity
contained the word 'ultimately.'" of efforts to adjust affairs to such
influences and to avoid resisting
Discrimination
them. Illustrative and constituting
It is important to observe that an
excerpt from Mr. George Shea's
the

years

terfered.

our

Research,

the

mine, except when the State
Under

Century
American

March, 1958, contains Note
6, Page 4, reading as follows: "We
that

readiness

20th

—

dated

debt

held in

something

us

Reports

Common Sense, by the
Institute for Economic

private

certain only if it consist of money,
metallic coin. The name reserve,

use, was

search

believe

column in

30, 1934, the Congress
enacted
legislation allowing the
Executive Department to seize and
melt all gold coins. Also, it in¬

to

the

is

condition arising when the banks
of
the
country have originated

said

of

great discrimination between

On Jan.

inflation

that

This proportion can be

securities.

the

been

effect

Federal

our

ises to pay money, need the cer¬
tain support of such a proportion

Brinberg,

and

causes

of

reserves

understanding of

coun¬

Little" Again

a

again we look around a
little, we readily recall Mr. Harthe

man's

empowered.

Round

wood's above quoted statement

is

the

as

"Look

var¬

ordinary

terfeiting,

ings.

It

world.

money on the
credit of the United States, and it

true

gold with¬

drawals and insufficient gold hold¬

When

to multiple quota¬
characteristic of a defec¬

a

"The

Hoar,

money authorities carefully avoid
the claim that "with an automatic

History
of Currency in the United States,
by A.
Barton
Hepburn, L.L.D.
(Macmillan, 1924), P. 463.

only too well, the

know

we

Fed will be unafraid of

tive and weak currency.

12.

P.

two

note, a promise to pay
—gold—on demand."—A

being costly.

"Our

"—Autobiography of Sev¬

Years,

paper

promissory
real money

will

story. .*:

purchasing pow er in excess of that
required to represent goods pro¬
duced and currently coming
to
Reserve banks are listed as held
market.
The banks,, in this re¬
against all their Federal Reserve
spect, have originated enormous
notes and deposits.
But our peo¬
purchasing power which is unde¬
ple cannot touch these reserves;
sirable.
The greatest such power
the privilege of utilizing them is
is government debt used as se¬
confined to foreign central banks
curity for paper money and de¬
and
governments.
The reserves
mand deposits. An immense por¬
against the Federal Reserve notes
tion of the private debt used to
and deposits in Federal Reserve
secure paper money and
demand
banks held domestically are
deposits is of the sort affording
merely
accounting
devices." —
the undesirable kind of purchas¬
Why People of U. S. Need a Gold
ing power to which Mr. Harwood
Standard, by Walter E. Spahr,
referred. Examples are real estate
Reprinted from The Commercial
loans
and
instalment
purchase
and Financial Chronicle, Oct. 16,
loans originating in the banks' de¬
1952.
mand deposit departments. Banks
More About Reserves
can properly make such loans
only
However
wisely selected, the in their savings departments.
securities given against a bank's
A special bulletin entitled Re¬

paper

demand

As

replen¬

reserves

tions,

practice. The true theory of
money is that a piece of
a

gold

of

with diminished honor in the

'cheat, vexation,
snare, a medium whereby we
are
continually cheating and
wronging one another in our deal¬
ings when at work and com¬

following the Harwood

is

in

...

simple terms,
capable of understanding the true
theory of paper money if that
theory is emphasized in his daily

very

-

used-up

paper money as a

buyers of prices in general.

money

only

stitution

a

to

tell the

and the

bank reserves,
which the Fed

up

the

and

such

seems

use

ishes

the difficulties
profitable exchanges

ious

long time before 1920,
because of two things common in

Round

them

of a Fluctuating Medium
of Exchange.'
He denounced

Mr.

quences

as

Little"

acquiring' United States
dollars can get the fullest
possible benefits from them only
by trading them to others in the

little

a

vailed for

accord with the idea

our

coin

is

abroad

Sherman
pub¬
pamphlet entitled
'A Caveat Against Injustice or an
Inquiry
Into
the
Evil
Conse¬

1752,

lished

1920,

simple

was

dollar

a

understanding of the nature through our government's calling
piece of leather, a piece of irredeemable promises to pay

skin of
wise

and

An Occasion

a

cloud of general negligence to un¬
derstand
the
simple nature of
money.

stands,

ex¬

consequence

best way possible,

forbids

defined.

grave

paper

:

anyone
in the partment of a bank whose de¬
ute, independently of other move¬ United States to possess gold for posits are subject to withdrawal
ments, to the realization of higher use as a storehouse of value or as on demand.
Long ago, history
prices. For the change to come a medium of exchange.
Well- established that the only safe use
about, time was required, but the known for 25 years, this truth is of demand deposits is to lend
intended to serve here as a re¬
expectation has been realized.
them, after making a proper re¬
minder that nowhere in the Con¬ serve, on 30, 60, 90, or, at
most,
A General Negligence to Consider
stitution is such a power granted. 120
day paper secured by goods
the Nature of Our Medium of
Moreover, the 10th Amendment "currently coming to market."
,

A

for

"In*

gold standard, when credit expan¬
grains of pure gold and 1.524 sion must end, if the monetary
grains of alloy. It will be observed standard is to be preserved. That
that this name is unqualified and, situation arose in 1920. The
gold
therefore, can be contrasted clear¬ brake finally brought the expan¬
ly with the terms, Silver dollar and sion to a halt."—Walter E. Spahr's
Paper dollar. Under present con¬ note
9,
P.
3, Monetary Notes,
ditions, our Government, though March V,'1952."u y
In his The Cause and Control of
promising it, denies redemption
in one dollar or multiples thereof, the Business
Cycle (The Murray
the medium when redemption is
Priiitiiig;
Company,
Cambridge,
completed being gold bullion. The Mass., 1932), on page 49, Mr. E.
right of such redemption extends C. Harwood says:
"Inflation is
only to those foreign Central banks defined, therefore, as the condi¬
or
foreign governments holding tion arising when the banks of
me¬

to

extent

convert.

is, that, with the exceptions noted,
all
people
and
all
institutions

Charles

by

The

but standing out is
the perfidy of refusing redemp¬
tion in money. Here is a marked
want of integrity. Yet this want

1940."

Constitution,

ent,

Dollar Redemptions Allowed

ports-Twentieth-Century Common
Sense," from which I quote: "Gov¬
ernment sponsored 'theft' via in¬
flation has taken nearly $200,000,€00,000 worth of real wealth our promises to pay money,
(goods and services) from holders tallic coin.
Presumably, in
of

the

Thursday, October 30, 1958

.

to

.'"—The Making

.

.

.

persons) are denied this privilege

for specula¬

purposes,

designs.

the

Parenthetically, the purposes of

dollars,

of

dollars rep¬

or

resented.

this

tive

Warren, P. 55.

; ;.

\

money."—"Monetary Notes ," Nov. in a dollar or multiples thereof,
9, 1952, Sec. 9, Note No. 8, by but, for the convenience of hold¬
ers of bills of credit or any gov¬
Walter E. Spahr.
ernment promises to pay money,
Concerning this matter, it is

the

it

kept in continual disturbance by
the intrigues of wicked men for

Specs

partment in

form of taxing or
tributions

making

be rich and
happy; thus the national mind is

this

and

and

the way to

tender is

Put On Your
noticed

"money"

paper

from first page

.

seasonal

factors plus the needs of the U. S.

Treasury
Reserve

addition,
nance

a

will

strongly

System

the

influence

actions.

Treasury

...

must

deficit which in the

In

fi¬

com¬

"The public funds of the differ¬
ent nations of Europe, particularly
those
of England,
have by one

author

been

represented

as

the

accumulation

of a
great capital
superadded to the other capital of

the country, by means of
trade is extended, its

which its
manufac¬
tures
multiplied, and its lands
cultivated
and
improved
much
beyond
what they could have
been by means of that other capi¬
tal only.
He does not consider
that the capital which the first
creditors
to

of

the

ment in which

certain

they advanced it, a

portion

produce turned

of
away

ing in the function of
serve

in

that

maintaining
to

advanced

public

government, was, from the mo¬

maintain

of

a

annual

the

from serv¬
a

capital, to

revenue;

productive

from

laborers

unproductive

ones,

ing 12 months will hover around

and to the spent and wasted, gen¬

$10 billion.

erally

These needs will tend

in

the

course

of

the year

Volume

Number

188

5790

without
even
the
hope
future reproduction."

Turning to this book
finds:..

one

debts

whicii

of

at

,'.

■

,

from

13-V'-*

page

Q

- • - '-

-

(1793)

;

v

-/

-rrrjr

Bankandlnsurctnce Stocks

* ■.

present

oppress,

has been pretty uniform."
A second observation from

In

the

the history

of the 19th
Century is to be seen the chief
cause
of
the
greatest financial
crisis
of : that
100-year period,

-

By ARTHUR B. WALLACE

This Week
lars

in, existence.

finished

Rather

record

it

is

strength of

of

the

is

It

not

will

history.

past

of

measure

Economy,

The

Commercial

given

as

in

the

and

t

short

as

we

are

tribution.

a

We

.

.

in the

of the

use

ward for such

an

than in

increase.

and

consumption to operate.
Both phases of the cycle need to
in

order

to

the

get

greatest

efficiency out of the engine. The
their rewards by
of increases, workers in in¬
creased wages,
investors in in¬
creased profits. But the consumer

producers lake
means

share

his

takes

in

decreases

•

•

long-term obliga¬
tions which are never repaid.
In
The
Wall
Street
Journal,
equivalent

to

they ^rojb^tlie

permits 1 it,

mone,y

c'onsuini4<Hbf his share and

more.

By translating their share into in¬
^Aug. 9, 1957, an editorial refers creased
prices, they create for
"to "the thought that the Govern¬ themselves the illusion of some¬
ment can go on spending more
thing for nothing, a reward
and more, year after year, without
greater than they have earned. So
discipline and without end. These long as they are both producer
economic
magicians smugly as¬ and consumer as most of us are,
that they

know better than
the
experience of all recorded
history."

sume

Conclusion

Attention
to

of

certain

tween

-unjust,

given

Constitutional,

taxes

government's

over

money

which

using
are

powers

not granted

by the Constitution. We have seen
it do this through ignoring the
true

nature

of

through

money;

price spiral.
sions, fixed

But people on pen¬
on
fairly static in¬
cannot increase their

comes,

from incomes and

resulting

our-

be¬

statutory

our

although
and

been

difference

outstanding

an

taxes

has

now

they can keep up the illusion; and
in fact, when inflated prices rise
faster than wages, they have an
apparently perfect justification to
begin another round of the .wage-

are

thus "the greatest

losers.

.:

(4) The
number

greatly out¬
producers when we

consumers

the

include those who

wear

both hats.

'

"

donment of -the gold

standard is a

thoroughly dishonorable prohibi¬
use of money, coined

tion of the

metal, causing, among other
things, a toleration of the Federal
Reserve System's dishonest alter¬
ation

of

reserves

counting devices."
1

An

to

mere

"ac¬

'

,

*

established lesson in life is

dishonest

that

-

The

same

individuals

holds true of

an

fail.

aggre¬

by

The

woman." It is the

a

has

Habliston

the

staff

of

added

to

& Co., 634
Street, members of

Morgan

South Spring

ing rate, highly important to

of price stability
they won't work

ters s£e the hope
—-

think

don't

for it.

:

pensioners and fixed income peo¬
ple escape inflation, the pick¬
pocket, and have a chance to get

the

consumer's

price

share in increased

prosper¬

a

script

picture

(Specia; to The Financial

Chronicle)

Calif.—Earl W.
Morse has joined the staff of
Witherspoon & Company, Inc., 215
LOS ANGELES,

West

Seventh Street.

New E. I. Hagen

Branch

Wash.—E. I. Hagen
& Co. has opened a branch office
at 915%
Pacific Avenue, under
the management of Jack R. Bratlie. Charles H. Dick is associated
TACOMA,

with the

new

office.




one

from which

are' scaled,

declined

during the recession, but it
put up to 4% in September.
banks

York

New

First

was

not

has

Guaranty

is the

from

one

loan

in

volume

normally start, as it is then that
retailers and wholesalers begin to

261

Trust..-

.349
-'•••

-

451

1.857

York

New

Trusts

stock

dividends

subscription

and

rights

2,079
536

321'

301

in

made

1937

279:
507,

,

•

512

United States Trust,

^Adjustments

for

changes

capital

figures

viae

in 'period.

This increase in working assets
surely indicates growth, and this
writer
will

is

of

the

opinion that this

reflected

be

earnings

as we go

in

improved

along.

Woolrych, Currier &
Carlson Formed in LA
LOS ANGELES, Calif.

-*

dore D. Carlsen has become

ciated

Theo¬
asso¬

with

Woolrych & Currier
of San Diego to form Woolrych,
Currier

&

;

The

Carlson.

firm's

main

office

will

continue

in

San

at

Diego

Street.

A

Mr.

Carlsen

will

be

in

increases

-

386

.

331

P..Morgan & Co.—

J.

strong of late, the weekly report¬

which

"

507

,

Trust—393

Manufacturers
•

400

1,544

489

Trust—/„^^t.j_

Irving

-

ing of it has shown ups and downs.
The mid-year date

-

459

377

City

Hanover

233.

been

National

dent

-

resi¬

partner

of

charge

the

Los

new

Angeles office
at

West:

210

Street.

7th

to

be

when

consumers

they

who

it.
The
unorganized

need

are

may have a greater
its protection.

right to call

on

on.

like

In

may

happy ending—prosperity

without

our

important increase in government
bond holdings by the banks from

the

THE
gen

&

Branch

DALLES, Oreg.—E. I. Ha¬
Co. has opened

a

branch

National Bank
Building, under the direction of
Eugene T. Porter.

office in the U, S.

earlier.

year

crease

E. I. Hagen Opens

comments two weeks ago

the banks, we pointed out the

on

a

inflation.

of the Federal Government

have

ment

this!
The
be changed in
detail but I think the general idea
is sound and will lead us to that

final

Let

make it clear

me

right here
that I am not thinking of a return
to wage and price controls in the
wartime
pattern.
They didn't
work and

never

will.

I

am

think¬

ing of a simple self-triggering
system of enforcing the consum¬
er's
priority in a free market.
Suppose the government said to
labor
and
capital "you cannot
have increased wages and profits
in any year following a year in
which prices rose?" Or to say it
another

With E. I. Hagen Co.

way,

so

loi^g

as

(Special to The Financial

Chronicle)

in

a

result of
and

volume,

OVERSEAS

GRINDLAYS

BANK

AND

LIMITED

and Grindlays Bank Ltd.

SUMTER,

lor.

rych

was

Bankers

an

economist with the
Company of New-

Trust

to comipg to Cali¬
fornia. Mr. Currier, a native CaliYork

prior

13 N. Y. CITY
BANK STOCKS
3rd

Quarter Earnings

Comparison

26 BISHOPSGATE, LONDON, E.C.2

Bulletin

London Branches:

on

Request

i

13 ST. JAMES'S SQUARE,

Bankers

Branch

Warren

Head Office:

S.W.I

54 PARLIAMENT STREET, S.W. 1

G. H. Crawford

Edmund

Alma/gamatlng National Rank of India Ltd.

Bartos,

S. C.—G. H. Craw¬
ford Co., Inc. has opened a branch
office in the Shelor Building un¬
prices der the direction of Henry H. She¬

stay stable or drop every year you

as

loan

partners in the firm are
H.
Woolrych and
Currier III.
Dr. Wool¬

Other
Dr.

part of it was due to the increase fornian, has recently returned to
in deposit volume.
But the im¬ the coast after 12 years in the in¬
vestment business in New York
portant point was that, with a
with Allen & Company and P. W.
single exception, invested assets
(also called working assets) of this Brooks & Co.

PORTLAND, Oreg.—Vincent S.

Roger A. Chaney, and
Lewis R. Thompson have become
affiliated with E. I. Hagen & Co.,
American Bank Building.

Part of this in¬

about

came

decline

NATIONAL
Senator's Basic Proposals

Witherspoon Co.

it is the

as

others

While loan volume at the large

the Pacific Coast Stock Exchange.

Joins

all

:

(And in parenthesis let me sug¬
gest that only in this way can the

some

banks

later

of

brought to play.
That power is already being in¬
voked both by labor and manage¬

Calif. —Keith
been

who

spends the consumer's dollar and
when she and her millions of sis¬

follow

will

LOS ANGELES,

the

woman

up

439

1,398

■

build up inventory for the fall and
The new firm
To return to our TV picture,
winter trade, and it is about that has made ap¬
Ted D. Carlsen
"Prosperity Rides Again." This, I
time that crops begin to move. plication lor
get it, by lower prices.
In fact believe, is the call that can bring
Since that date this year, however, membership in the Los Angeles
they should have priority.
out the posse and put a potent
business loans at the New York Division of the Pacific Coast Stock
weapon in the hands of everyone
How can they get this share?
banks have declined in volume by Exchange,
and will maintain a
of them;
This will put them on
First, they must realize their right
some $428,000,000.
This compares direct wire to Troster, Singer &
the side of the "good guys" and
to it and demand it in the market
with a shrinkage of $461,000,000 Co., New York City.
down
that villain
inflation the
olace.
Stable or lower prices at
in the like period of 1957.
But,
worst of the. "bad guys."
In the
Mr. Carlsen, who has been in
every level of production and dis¬
compared
with last year,
the
tribution must become
a
fixed picture the "good guys" always banks now have the advantage of the securities business in Los An¬
win.
Remember this when you
geles for the past 21 years, has
public policy instead of the pres¬
decide which side you will be on! firming rates, even though they recently
been manager of the
ent acceptance of inflation. How,
will not get the full benefit of, let
Can we have prosperity without
trading department of Harbison
can they know whether they are
us say, the September hike, until
& Henderson.
:.
inflation? Of course we can if we
getting it? By watching the move¬

power

G.

power

by govern¬
phrase says,

holding

are

Manhattan____,

Chemical Corn Exch.__

Empire Trust—

•

well, and interest
rates are one of the components
ol' bank earnings. The prime lend¬

ity.)

gate of individuals, such as the
under a
recognized official, ac¬
people of" these United States.
Appalling to contemplate is our cepted standard of measurement.
And if just demanding their share
destiny if we do not discontinue
in
terms
of
stable
or
reduced
very soon our present dishonesty
prices won't work — maybe the
'in monetary affairs.

(Special to The Financial Chronicle)

famous

underestimate

"never

of

and

management

ment.

They should have every right to
a real share in the gains of pro¬
ductivity in the only way they can

■

Morgan Adds to Staff

Chase

re-discount

Reserve

•

ment

applying
unlawfully
the name
dollar; and through forcing the
use of debt to support debt.
That which is called the aban¬

Federal

.

term money or

•

The

.

.

—

of the term dollar. decreases of the prices he pays.
Since the New Deal, it turns out,
(3) In inflation, the producers
short-term, or Treasury, bills are not only take all the gains created
never
paid, but renewed again by greater productivity, but'be¬
and again.
Therefore, they are cause of the heavy oyer^upply of

continuous and increas-

*

share in the benefits of the proc¬
ess

a

inflation?
True, it would rate, recently advanced in several
force you to readjust many man¬
Reserve districts, followed by sev¬
agements policies,
but-most of. eral others. Now we learn that
those
readj ustments ; would
be ■; this rate in five centers—Philadel¬
good ones. If we could effectively
phia, Richmond, St, Louis, Dallas
control-/-yes^almost certainly. end and Minneapolis — with Board,
price, inflation, you could turn •
approval, has been advanced from
your, mind, to the improvement of 2% to
2%%; with the remaining
.productivity; and the risk, of the • districts staying at 2%, to which
suspension
of
wage
increases figure their rate was boosted in
should turn your workers' minds *
August from the old 1% %
toward the same goal. Booms and
One of the better signs of the
recessions
would
not
automati-.
trend in money rates is the Treas¬
cally be eliminiated, but their se¬
ury bill rate, as Treasury bills are
verity would undoubtedly be re¬
issued
each week
for the
rela¬
duced.
Speculative,-pressures in
tively short "period of 90 or 91
inventory would
be diminished
and there are many other value^. days.; This rate has been above
2%% since last November, and on
11 was a business executive- for
Oct. il reached close to 3%. Be¬
30 years—in a business that was
cause of the bills' short maturity,
comparatively small but whose
they are used by the banks, and
scope included manufacturing, dis¬
particularly by the larger institu¬
tributing and retailing.
Against tions.
this background, I think this idea
In other words,
interest rates
is worth investigating by labor,
ing

(2) Prosperity is a two-phase
engine that requires both produc¬
tion

:

1

only do this by

can

Bank Stocks

-

our

Financial giving everyone some share of the
growing prosperity which is re¬

Chronicle, July 26, 1956.
"Napoleon Ill's was the Goveminent,
of
cheap bread, great
.public works,
and
holidays."—Er-c. Brit., VoL 16,
;V ;\i
r
So much for past events:
Our
i public debh grows and grows, and
: is represented chiefly by Treasury
bills/ As we know, these instru:ments represent debts which are
'promised to be paid in short terms.
However, here we are: as dishonor¬
able in our use of the adjective
■

future—of

—

be

perfectly free to divide
Indications continue to increase group of banks showed a good
the producer's share of increased
that the recession from the 1957 increase at the Sept. 30, 1958 date
production and productivity as
highs has about run its course, and * when compared with a year ear¬
you please according to
present that better economic conditions lier. The
average increase in the
and existing law. But whenever a
are
developing.
Several sources 12 months was $6.4%, not a bad
rise in the average price level for
have tabbed the let-down in busi¬ showing in view of the fact that
a -year
reveals that you have ness as the shortest
recession since the period was one of economic
robbed the consumer of all of.his
the end of the war; and, certainly, contraction. It was for this reason
share, then your right to increase. if wp
arp now well on our way out
that
earnings held up so well,
will be suspended for one or more
of the slump it will have been one while those of industrial and rail
years until his prices come back,
of rather short duration.
Unem¬ companies generally did so poorly.
into line.
5 ♦
; f
;
ployment is on the decline, em¬ The invested assets exhibit is as
What do you think of this basic
ployment on ' the increase, car follows: •
y
3
:
idea?
Can you live with it?
*
In loadings up, etc,
Invested Assets
Per Share0
fact, wouldn't you prefer to op¬
Every week or two we read of
:>/30/5-; »/30/5»
erate in an atmosphere of stable increases in bankers
acceptances
Bankers
Trust.
$504
$534
or
slightly falling prices rather - and in commercial paper rates.
Bank of New York
1,542
1,638

a

rising power for the
potential capacity
for growth.
It is the composite
namely, the crisis of 1873. This
expression
of
increasing skills,
was
Napoleon Ill's financing of
socialistic programs by debts "on improved productive machinery,
and
more
efficient methods
of
the argument that the public debt
manufacture and distribution., To
was not a liability but an asset to
insure a steady increase in the
;the economy." Reflections in the
rate of productivity, we need to
Dangers of the Present Economic
Situation, by Felix Somary, Doctor motivate,all segments of our eco¬
nomic society to make their con¬
of Law and Political

Zurich, Switzerland,

1 il

.

enormous

arid will in the long probably ruin,
all the great nations of Europe,

past:

-

■

29

.

350,

•

•

Continued

any

/

'•■';/

of the

The Commercial and Financial Chronicle

.

.

s page

1.;V«

"The progress

.

to

the Government In: aden, Kenya,

uganda, zanzibar a somaliland protectorate

Branches^ In:
india, pakistan, ceylon, burma, kenya,

Laird, Bissell & Meeds
Members New York Stock

Exchange

Members American Stock

Exchange

120 BROADWAY, NEW

tanganyika, zanzibar, uoanda,

Bell

aden, somaliland PROTECTOR ati,

(L. A. Gibbs,

NORTHERN and SOUTHERN RHODESIA.

YORK 5, N. *

Telephone: BArclay 7-3500
Teletype—NT 1-1248-49
Manager Trading Dept.)
Specialists in Bank Stocks

30

(1794)

The Commercial and Financial Chronicle

Continued from page 18

<

political structure of this

*•'

s

country

Politics and Recessions
who

Senators Kennedy and Ives,

had the responsibility for putting
the bell on the cat, began by con-

suiting the cat. They got in touch
with George Meany, the President
of the AFL-CIO.
The Kennedybill

Ives

,

which

bore

emerged

a

striking similarity to the Meany
proposals for a labor bill which
had appeared
in the AFL-CIO
"News". To insure Meany's support, the bill contained little or
nothing that would get to the
heart of the abuses of labor power,
but it did have several provisions

that would, have
Taft-Hartley law.

weakened

the
>.

for candidates. They will provide
publicity in the giant labor press,
And after election day, these
union leaders expect to collect
what they feel is due to them.
They will demand the kind of
government they want, in addition
to the retention and extension of
the privileges and immunities they
now have to the exclusion of any
other citizen.
If you have been following their
political utterances over the years
you know that the kmd of government they want is not the kind of
government< you want, nor the
kind that most Americans want.
They want the kind of cradleto-grave-welfare state that has

voice in union elec-

tions."
t+

A\A

hacip

.w

Hool

uninn

u/rnriffQ

JL u~L

nornntrofw

...J?

p

atfainsf

l^arW*

nifirflfintf

ir.fr.

thp

,,nnn

nf

hnv

expected to thresh

A

ig

to make

cummuu
common

the

On

and other

hand,

approached

was

by

;^n those of symptoms. ~Among, two different methods:
^
sacJ\ ear^na^s or outward signs, , (l). One was direct and simple,
and that includes the vast:.busi-'Pf
^ Ier!»w *i10n5 are5frequently. jt consisted.in constructing a 12ness
community
which'''ri*eatesvv^ff ddv^eifp?escntiy»sitiqn has year moving average of current
America's wealth under increas- often in the past been, precursory earnings.
'
v
ing handicaps. And this leader-^drastic declines of stock prices. v;: ^2) The other, method-was- more
ship is beginning to come forth/Jheu.
1 re °f yiTelds ls :now complex: -It used the concept that
must

of

sources

fromthe

come

conservative

strength,

.

.

National

'/^01^m ®IS,,alS'
e a r n i n g s are the ^'dividends'
Sufh. fears, however - may be fur,d » .From the average histor^ ^u<ih on;.a f.ormaAs.tlc ^cal relations between.the rates of

of

Manufactur.r??:is
bli a^ frs

9..assist and mechanical apphca W

gX™*8 i^

of

^-Cn

of

-dividend

payout*

•

of

a-curve

'fife

sufficient for payment of

i«ns
P
j
^^,wiL-norraal dividends. :
p g
Particularly-. The'earning power curve of the
Some may have beard of some when they dcclmedbelovv them. ■ j) j j. a appearing on "Fig. 1; is
of the other efforts being launched ; it seem3 reasonable to assume the result of a simple arithmetic
corporation business affairs. They
this^ field—the• Syracuseplan, that such an incentive may be - average of these two estimates. T
want high taxes on everyone who S?.n®ral Electric s program,;Gulf*weakened, or may even disappear, :cV'On Fig. 1, the normal earning
shows drive and initiative and tax Oil Company s program, and other*; in periods when the majority of power of the D J I A is expressed
reduction for everyone else. They movements.
;
.investors hape doubts concerning by a single line. In reality,'^ of

ments. Many of them even want
government and labor in a posilion to out-vote management in

.

There is not only room for you the stability, of
in this movement, your participa-- power of fixed;
tion is vital. It is vital, to the their faith in this
country, and it is vital to you. to be as strongly

And they want to control every
employee, whether or
not he

the purchasing course, no such definite and clearincome. When cut appraisal could have- been
respect happens made. A better mental picture of
undermined, as this, line would be in the form qf
.

.

,where will
lshed

would

it

in direct vaR>e terms, but rather i! and sellers,

Conservative leadership-for this

struggle

wishes to belong to

other

v i ?

.

'

evils
eviis.

*'♦

w?<

relation between stock'and bond:the normal earning power of the
yielas. Much of the thinking about D J I A, resulting from the cotthe values of stocks is done not elective trial and error of. buyers

/''*

their minds.-

up

-

.

vfc

*

vestment of profits.
in bargaining elections

or

differences

our

■#

Guidanceintoof^Jw'ih♦°n'
^wai;k ^normaT/dividends was computed,
eovern&"
®nj?t
considerable It served as the basis for deriving
WaT d<T "T order„ t0 a leveh of earning power neces-

want to divide corporate profits
" and choke off America's growth
possible only through the rein-

thL

uni/wc

oligarchy

an

V ;

-

■

-

th

nnrtiL i.

innnppnf

tranivatinnai

+t,A

fnrmLnn

mnnnnntip? fprnn^rv

khnr
pnttc

«rifK

oil

of

nobility,

a

-

Thursday, October 30, 1958

An Appraisal of Dow-Jones
Industrial Average

f

out in the open in full hearing of
the voters, and allow the voters

•

brought disaster to so many nalions throughout the course of hisest" in certain aspects of the han- tory. They want to strengthen the
dling of union fSnds, and would Federal Government at the exhave given members more assur- pense of state and local governsome

•

tyrant. We have a representative form of government. We are

The bill, as it passed the Senate,

of

oper-.1

a

would have required simple hon-

ance

be

Continued from page 3

.

.

as-

^
alty,

Committee promised to produce a
labor bill.

the

on

sumption that it would

■

a

B

created

was

.

a.

_

have placed many supervisors under union control, it would have

^

_

ate

by

taxation

until thev

.i-_

-

-

can

and

stocks, whose dividends

inflation

longer

no

buv the

statistically

And

around * it.

can grow,

in order to purchase bonds. Thus,.represents

it

composite -view taken

a

that

allowed

you be if your: cus- -seems now to be the case there countless points of individual
tomers continue to-be impover- is no inducement for selling judgments clustering irregularly

union

a

construction

force employers to

before

a

worker

unions

to

sign contracts
hired

was

and

.

barring of
woman

^ao^ai

non-union

a

from

employment

—

in

until they are beyond the
books of your customers9

other words, make the compulsory
umon. shop illegal.
Known as

wouldr

Right-to-Work

liave

allowed

economic

legally

re-

these

laws

now in effect in 18 states

labor practice out of extortion, in-

you

sell

of

mC

x-

nomic forces at work which may
pocket-' contribute to the same result. ' J

-in

soar

hppomp

are

price

.

.

1

ehil

thp

dre^na^^
C^A:
^en who are your pride> and

In all

placed by other workers to vote states it is illegal to refuse to hire
ib representation elections. And it someone or to fire him because he
would have made a mere unfair exercises a right to join a union
stead -ot regarding it as a felony as
the law has regarded it for cen-

*jl

products

then deliver all his employees to
the
union when
hired, and it
strikers who had been

vvsxji

or

man

mS
This

r

over

which

so

many

she*

when

it

met

tears

its

were

tatives. Yes, the National Association of

defeat

Manufacturers

fpr this bill

certain that

it

advocated

after

could

it

was

not

be

im.

was

that it

for vote with

no

; curve

like

a

an(j

come

sacrifice

Gf age jn

-

if * thev

nation

a

n?

However,

-

^relieve/you^ll::
•'^el^InV?'^ea,^SnS hav^

^or'to"refcre^o

they

The'

validity has- to be tested. ;lf we
right in thinking that the

whenare

governmentfoW.vUen Ve d^Snatdr I''i.e=,

desire®

,

.

of

^

boliovp the pnvileees. of a citizen of

who still

us

people and not to be

are not performed.

by

served

^

ror'or rathei" since" the 'reflection

'

'

"

'

.our

should be able- to check it. This

4ake: the

To'

the people, have been slow to beLittle time remains before elec- is inverse, like the surrounding year
'
come alarmed.
tion day. Perhaps it is too late landscape in the surface of a lake.J ^~w?y m
•

that nowhere did it deal

leaders.

Union

members

join

unions lb connection with their
Work—not their politics. Yet, to-

day ^union"leaders

too

much

false

for

confidence

ideas

could

to form

organization'
Besides,"fluctuating cu r re n t "^hp £ J
of power and efficiency,-to deal earnings camiot serve as a reliable"
■JOT
with the problem this time.
You^^capitalization base. They do not

not

you

an

.Perhaps

we forgot the P«wer •
well-organized
minority
can wield.
All through history,
changes in government often have

that

a

been achieved by vigorous minorities.
And that is what we are

faced with today.

spending

are

This

ev?n
aiudves. Nor do these
didates rsor co inese

leaders

leaaers often
oiten

small

include

they

it is

i

~

,

Congeess, accord-

-

•

UiS. labor's News and IForid ReiJL'?! chieftains felt
port,'

they

on

minority,

•'»««'» strong enough foundation

dates wbo see,k y°ur v°tes, and, for supporting a capital structure.
irrespective of the party label, Capital is substantial. Its income-

were

a

government

dnteer to support those who de-

labor.

f

disciplined
■.

to impose such

on

us

.

force,

by

every one of us would be working

v

and .defeat

for

will

who

man

a

a11 Ameri«a'
...

.

In

"
...

..

m

^bor s Threat

.

a

.

UIlll

vomateers

.

ATtfanivn

laruze

fanwtn

teams of

tou ring every doorbell
district in
the

£y
on

election

?

po.^s

day.They will write

fpaecocs and distribute pamphlets




s

k-

to earning oower

~

We

Fie

mean'price

is 13 8

repeat this simple

can

1

was

cal-

complicated and precise proced-

-

-

ure

-

Jhl ldea of earning power or

0f average and representative and
normal

earnings

simple. But its level which effect,Vpiv

qptvpc

a

ha«!f<?

for

ftm

"cafn '"tt
or

definition

It

„

market.

Their ideas and mforma-

pro-

almost identical * constant capitalizer of143LY : ~ "
n

y

theoreticallv

is

of correlation analvsis. It

duces

-

.

the

uiultiplying each -successive

annual figure> ot earningjpower by

^bis

constant

capitalize*

of

14.8

obtain the curve <rf Market
Value which is drawn through the

ife
.

■

rmM of Fig

pression

of

1

^ue^wSef^
value.
Woen stock

to the ridiculous.

Only as an out- ations by substantial dodioes. And
tug of war, if prices remain for an extended
as reward fdr
period below the line of Market
it is our duty to provide the political affairs, sq
long as there good judgmeht add by financial Value,- there
—
r
leadership that a campaign to de- is a United States of America, loss as retribution for ignorance iogly extended rises,'
:
'
feat these men and these ideas And if
you, and people like you,; or
ineptitude, there emerges a
Of course, valuation decisions
^S1 require. No one is better perform the duties you owe to level of earning power that has ate pot always in the prlbe-makfltted for this role, because it is America, this Nation witt exist as operational significance for vaiu- ing saddle. Many other SnOuehces
a sales job
to be done by sales a great and free Nation so long ation.
,
contribute
to
the fonmdion of
methods.
as you give it your best.in this analysis the search-for stock prices, So, for instance, dut^

-

.

PftWnr

become battle tested and be ready ?ound oy lormuia or■ definition, it

*•
The answer to ^is internal particular limited campaign Or;
iSl ^bis, millions wdl be threat is to work and fight to de- objective. You, and people like
Spent. Thousands of union staff feat. it..
you,
will be needed always in
AmiliAVfMlfl
*

* ;

,

Faminir

And F°u will learn the first S:!!™?
lessons that politics, has to teach,
bv formula

..

acS SaioAtv

i80.34. The ratio of the

mi

average's

4948

1 am not appealing for any one tion about present and projected prices rise far above it, they
party Qr for a ^ force for a-earnings vary from the sublime eventually correct such ^vervalu-

Answer to Labors Threat

an

-

™

,

the novf

obtain

1

mifrht

"the SSe who mak^hf flw
??tes^ difference bSwe?n election
election
votes aitterence between
be

day and night t0 Pre" -xfanl

maior issues

Congress thev hone to

Dovw

nriAin

mTre.^t'jZtlStote'tovX ^vestofsasbasm for market
of

-

attempting

Uidntted
The

annual

determine whether they are a ■ producing mass cannot be ap- Cniatx0h for each of the years of
Pal*t of the labor boss conspiracy praised from so slim an indication our period and then average out
to rule, or whether they wUl fight • as earnings of a single year, nor the Various ratios Obtained The
th® cpnspir^y with- heart and of a few years. A more stable resuitillg figure is 14,7 * '
'
Wltl? intelli|€nce* You should do form of earning power' is needed^average

.eJJ"serve
oign government- m the world

$%S£
tives

S

and efficient.
■

Hole

not

well-organized and.

a

i

labor's PoUtical

.

spending,

are

*

many

does

eve^alf^of^thp8 leaders
all. of the
determined

•i

;

minority

even

b^er to women of both parties But
ask permission of the
m«n and
whose money

,

.

had

We

mean

was

ami

#

.

be sold.

Among ttieimany defects the bill

those

f^dom to join or to refuse to
y
.
^
.
. .
•.-...
declihes; -'.the: ratio" canhot* help ' f?n®rs whose transactions effecOnly then will em\ our voice m that government;rising^. The'respective movements ^vely-produce the -pncet curve
p Jees be free mep .and union came to you effortlessly with your 0f earnings and ratios have to be
ave boon using such a.level of
leade^s r«ally responsive to their citizenship, but the duties of inverSe. By tracing a rou^i chart earn"^ power^a^asd for a
membership.
t
citizenship are inseparable from of their historical year-to-year marlret^value of the D
I A, we
■1<?m unions

that these

with the problem of the growing
dominance of politics by labor

it is not^enough

di^r naiTl^' /bey ^® just expres-; merejy to submit a persubsjve ar"
Au
if118 between two t gumenb in^?avor -of a suitable

responsibility to deal with that
problem, and who are striving to

freedom? I hope the day will soon
come when aU states give the em-

manner.

had

of earning power does look
sounder capitalization base

,

opportuhity for real debate or any
amendment, and members refused
tp have it jammed through in this
■

v-

average

■

Thos^

it^was a'bad bTh'and

that

came, up

ures

,

proved and s?"0'4
on the House
Ives

Ratios

of two reasonable measdraws an acceptable picture
opinionJ of average
earnings. The smooth'and solid

one curve

are. by analysts and investors was the
than the more erratic and somewhich' uncommonly high and rising level times brutally changing outline of
'°eiXes the /ble to se?ve the' of .price.to-eafnings ratios. 8
current earnings.
'
'
But in your state and all except
Jj}e a Die to seive ine,
^
'
these 18 states it is legal under ne er-do-well, - .
.....
^ ,,s, f..^ .-It is easy to^^exaggerate the sig- ; Earniiig Power and-IVIarket Value

deserved

defeat in the House of Represen-

"

The Qlher problem encountered

union contract to require that an
Yes,^ gpverhment is yodr peremployer fire an employee if he sonal problem. Today, a few score
the employer does not join the union or resigns of men heading large labor unions
P ye from it. Is that American? Is that' are whling to

the Kennedy-Ives bill

was

.

.

„0f

Limitations of Price-Earnings
•.

tufies, and probably would have
legalized extortion if

r,

.

Ti.

5—

1

^

•

.1

.

.

Jt

i?if

i

_

•

*

u_

f

-

-

of-a

come

sanctioned
v

.

•

_•

ceaseless

by profit
*

.

.

_

u

A

-

—

#.11——

..

\

r

Volume

188

Number 5790

.

.

.

iing ^he long period of undervalu¬
ation extending from 194& through
•1954, two cyclical recessions and
the imposition, atrt]he time of
Korea, of v war-time controls and
taxes did not pas^ unnoticed by
'

1

"

Fig. ilr pictures Market
realism to

Wfth« sufficient

them

Value
dispel

is

in the respective levels.

The two; lines representing them

Normal Price-Earnings Ratios

parenthesis for
the-specter of a value vacuum. It on the chart are parallel, The ap¬ a few remarks. They may help to
also hears witness to the fact that plication of a capitalization mul¬ visualize more clearely the func¬
earning power is the foundation tiplier at the? level of earning tioning of the mechanism of cap¬
oF value.
In fact, earning power power raises,iit;s to the level of italization of earnings in the stock
r' market.
^
i» is valiie.'VFhe difference between value.' "

,

the stock market.

(1705)

The Commercial and Financial Chronicle

4

F

200

I

GU

E

R

Let

us

open

a

Earning power is an average of
earnings. In order to pro¬
duce the same level of value^ a

actual

different multiplier must be ap¬

plied

actual' earnings

to

Continued

miiiumi.
SSmhiiiSSI ISSSSSfSSjS! 1!"l: : jf! •«»! 1LZ* !&].■•■
IIIIIII.^na'^MU."Lnii|ilHWmiiHiliiiaaiaaaaaiiaai><n-BMaiaaaap[

jiiiibimim* *iiiiiiiitiiiiMiiiuiiiiMiRt miiiiiaiiMiiiiiiimiiiiiiiiiiiiiiiimiiii

KSaiai 1KiSm»iii""R»«ii""!'h"iiHiii»BB5»«»ii!ii!i»i»iii«iihiiihi»iiiii»bh«uibi» l

lll

tod

III

when

page

32

iiiiiiiiiiii kiii>»» k»k*ca

k*Efc»i*aiaii

iiiiiiiiiiii ItlllK iltli lllidf If ?lll

iiiiiiiiiiii iimmmimimtjim,

iiiiiiiiiiii iiiiii til Ml ill it i iiiiii
IIIIIIIIIIII HUM ttltii licit lllllll

IIEIHI1IIIIIL!IIIIUI.[.II1«.ipilllllirs.llicilllllll IBlIIIIIIIIIIIIIIIIIIIIIIIBBGIIIIIIIillllllRIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIimillllllllllllllllllllllBllllllllIIIIIII
ihhIhiiSiSiSiii iiiiiiiiiiii muiiiiiib «rm-^auaii iiiiiinmi miumiii iiiiiiiiiih ihdii iiiiri iiiiiiiiiiii iiiiiiiiiiii ■biiiiiiiiii uiiiiiiiiii iiiiiiiiiiii miniiiiiiii iiiiii iiiiii iiiiii iiiiii iiiiii iiiii i

ll.iU

on

i

ifi«S8ai38S tssssssss.ss ssssssssssss ssssssssssss ;ssssssstrLs ^
siLw .inSBSiii""'""■■■■■■■■ imimMiihiBiii■■■«■!iiiiiiiiiiiiiiiiHiiiiimuiinBiiiiPiii
KSilitm iiimmSSi

M

IIIIIIIIIIII If Hit MM!} Pitt IIIIIII
iiiiiiiiiiii ummmiummm;

m

II

iiliffififff ilisfi

90

ipbiiiiiii

:5Si555sSS::::jr:::ss;i::tiir:::cri:

• o

aaa

'

IIIHI

.4,1

,4, IIIIIBIIISII
'iiiimiMiai

■■■■■••■■Ml

iaaaiiiaiiH iiaiuiiiiii taiiailiaiia iiaiiaiiain

aaaaaa aaaaaa•■■■■•
aaaaaaaaaaaaaaaaaaaaaaai

s::::sss
■ BL,f

■ •ana

iSiilMHBIi

aBaaiariaasuiiJBiatiia

■aiaaaeiiBUMBaaaaaaeiaai

.4*4,

aaaaaa aaaai*laaaaaiaaaaa

.....ii4.B...

•

iaaaaa.

■■■MMIIIIII IIIIIIIIIIII !lllllllt»>l

•••■■■■■■..4aaa*.,aaaaaaaaaaataaatai

,(Eii:iiiiiiiiiiii tenia
a is until inn
.laaillll f llllI llllli IIIIII Ilk III IIIIII llllll

in-<i:i:[i3irki>

HIPV^

aaaaaaaaaaaa aaaaaaaaaaaa

'MIIMillllHIIIMIMRIillllfilimilliurimiMIIIIIIHI*;
iii*!^niii iiiiii iiiiii

iiiiiiiiiiii iiiiiiii1"

*'ni»

iii»iitiiMU»iiiiiii''iiiiiiiiiiii»,,:;««iiiiMnt.:m.:

aiMNifkl Iiiiiiiiiiii IIIIIIlllll>

millilkllliiklllllillllilkllllllii

•'filalilliUiilllllllli .•iltillllllllilllii'^ illlhi k'^liPIIIII illlll IIIIIIIIIIII illlll Klllil IIIIII IIIIII
iiiii illlKIIIII*: u .MMIIIII IIIIHIIIII! 11111111111! IIIIIIIIIIII
IMlhOIIMIMIMIIIil mi nil"!!

lliill'^iil Iiiiiiiiiiiiiiiiiiiiiiii
IMiiillllK

ii
iiiiiiiiiiii iiiiiiiiiiii nun iiiiii iiiiiimiiiiiiiiiiiiiii iiiiiiiiiiii iiiiiiimiimiMiiiiii iiiiiiiiiiii iiiiiiiiiiii immiiiiiiiiiiimiiiiimiiiiiiiiiiiiiiiiiiiioiiiiiiiiii iiiiiiiiiiii iiimimii
II SlHlf SUIIlillllHlllillllllilllllllliiiiiilllMllllllllilMiiiiiiiiiiiilllflllilil'llllllllllililiiiiklillllliiMiilill Iiiiiiiiiiii iaHiUiillUlllllillllHilattiiiii!
itiiit miii iieiitiiHiiiiiiiiiiiif i iiiiii mill iiiiiiiiiiii
iiiiiiiiiiii iiiiii iiiiii thulium iiiiiiiiiiii iiiiiiiiiiii iiiiii iiiiii iiiuiiiif ii iiiiii iiiiiiiiiiiniiiiiiiiiiimiiiiiiiiiiiiiiMiiiiuiiiiuiiiiiiiiiiii iiiiii iiiiii niamiiii* •iiiiiiiini ibiiii iiiiii iiiiiui nn iiiiiiuiiii
6IIIIIIIIIC lllllMlll'? IIIIIIIIIIII iiiiiiiiiiii iiiiiiiiiiii III! SI "le'eiBI iii Illlll III! IIIIIIIIIIII SI Illlll'ii IB" Mil* I lllllflllil! hum IIIMI IIIIIIIIIIII ilBBII IlkllMllli I Illlll Illlll Illlll IlllH iii II' IIIIIIIIIIII IIHIIIHIII

*

1939

1

19 39




1

1940

1941

1942'

1943

1944

1943

194 9

'

1947

I94S

1949

1950

1951

1952

'HH I

akakll

aklllilllkllItlktltlktal (k»,>••»■!

11IIIIllllliallliiIIIII; !»' .aa i.k'lll
iii*i;i:a<«niiiiiiiia.( '.citMinin
.aiiiiiiini !«<;:• ur<i Dial rfPflll

»«•*»•; tin OafcitiUlill
H'ltaiillll iJ'UIIII'*, • a till Illlll IlliiiUllii UmMIUIII
iiiiiiiiiiii iniiiiiiii' f iiiiiiiini iiiiii iiiiii hMiPf'III

iiiiiiiiiiii iiiiii iiiiii

193 T

an

ill

<k(«iaiiikat<aatiiiiiiii

.

iliillli*": jtiiiililli; 'IIIIIH6III IIIIII lliki*

(«jui i>

.ibiiiiiii i>aBaiiiiaa"a><aijaBaajiiaaaiaaa|ii

.anitiiaatiiai,

lime icim
IlIlia•■•■■■ikkkkiiillll
'■it'iaiMi niiaiiii laaianiim iiiiii •■■■■I iMMugMM
(kills Skill) «•»
IIIIII Ilia i*
■■nMDBilHII
akkktk)■■■«((an IIIIIIIII ••■•kiIlllllllilllIIIIII
iiiiiiHiiiiiiiiHttiiii.iiiiiimiiiiiiiimn
rTrT—//Minn IIIIIIIIIIII ll»l«»«*lli»i illlllIIIIIi' 'l«iIIIIII llllllllliil illlllIIIIII (allIIllllIIIIIIIIllllfc* (llllillllllimillllili IIIIIIIIIIII IlllllIIIlli
iiiiiia»'ia<ii»a«ii»»iiiiA'iiiiiiiiiiiiiiiiiii
'lOktlllf
IIIII? aitlllllllltllli; illlll IIIIII IIIIII IIIIII IIIIII IIIIII
mbUKMIIuhi iiibsiiiiii' iz-alks
a
man niiii iiiiiiiiiiii iiiiiiiiiiii naif iiiiii!
till I' ilf a illllta jllll llll^kMIIII IIIIIIIIIIII
i,)*(ii'isii iiiiiiiiiiii iiiiiiiiiiii iiiiii iiiiii iiiiii iiiiii nine iiiiii
IIIIIMINIIIillilllllllt iiiiiiiiiiii iiiiii unit
iiii-uini iiiiii iiiniiiiiiar*ijii iiiiii iiiiii
il'*illlillllia'..Jaaaa, iiiillillllMieiliin?" ■til': ,itMi iiiiii linn iiiiiiiiiiii! iiiiii iiiiii iiiiii nine mill iiiiii
'"'•■i ilini iiiiiiiiiiii
111(1 Mailt illlH lb ill I illlllllkci: t'lllllllll IIIIII Mill
'
•

I95J1 I9341

19 3 5

uiiiiiiiiii nuts iiim: miiutmi

iUMIIIIIIIilillilllii; llijijli

II

iiiiii iiiiii uiiiiiiiiii ti; u <111111
Illlll Illlll IIIIHIIIIVB ii5mhimii

195 5

19571959

32

The Commercial and Financial Chronicle

(1796)

Continued

how

An

have

Appraisal of Dow-1 ones

they stand above or below earning
than to the latter itself.

In

that

current

of

earnings

D

the

contrary,

earnings

rent

are

rent

If

base

power

represents the

which

should

be

used

would

have

been

normal

if

as

Fig. 2 tells the
order
from

the

to

year

story.

same

them

make

to

year,

In

comparable

it

all

plots

ratios in terms of annual averages

the

stock

prices. At this moment,
price-earnings ratio is
therefore higher than it is drawn
of

the

actual

on

the

chart.

But

price-earnings
would

still

it is shown

theoretical

the

ratio

remain

for

1958

16.8

at

Fig. 2.

on

normal

It

was

described

only

exceeded its normal level.

the

not

offer

far

a

capitalization

stock

Fig.

apart.

true

that

in the

also

a

average

its

above

de¬

rose

Market

Value

recent

sharp

market
If its
not

voicing

its

conviction

easily

be

will

without

the

opinion.

own

it will
Yet the

reason.

remain

not

stubborn

It is eager to rec¬

this is the road

as

point

raises

earnings and price-earn¬
ings ratios move in opposite di¬
rections. At the beginning of our
period, the multipliers were
higher in the recession year of
1938 than in 1937, which was a
year
of high earnings.
History
was repeated at the period's end
in 1957-58, and as the years in
between were rolling by.

much

Current

tach

the

question

importance
to

this

as

we

to

should

rate. An

values

discount

to

at

truly

a

future

significant

in its selection

error

in

A

completely

can

distorted

for the most accurate

even

7%

has

rate

discounting

been

it

ures,

future

stems

historical
an

2%

per

normal

divi¬

from

current

an

average

return

of

5%

average rate of growth of

both

of

annum

earnings

The

earnings

average

well

we

project fu¬
accurately and

can

earnings more
them
more

capitalize

than the market

ment,

does

will

direction

tend

of

to

such

the

of

how
at¬

fact.

mo¬

that Market

we may assume

Value

correctly

at

in

move

the

Intrinsic

an

Value until they rejoin. The mar¬
ket's traveling speed toward this

goal will be conditioned by the
degree and timing of public rec¬
ognition of the correct projections.
But

the Intrinsic Value is the ob¬

:V

J

may

I

A

represent

new

a

American

iealue

c

is

level,

average

profit margins and




instead

of

rate of

a

of

fined

stock average, can be de¬

a

and

of ways.

computed

It

sets. to return

original

on

But

for

logical

variety

a

net worth

investment,

factors.
seems

in

be related to

can

to

or

purpose

select

on

other

and

our

as¬

the

it

basis

of
valuation
already
used
for
computing Market Value.
This
basis is earnings.
A

practical method of compu¬
may be derived from the

tation

principle that the value of
mon

the

a com¬

stock is the present worth of
sum

of

all

future

dividends.

ings,

worth

present

can

earn¬

be

depreciation
which
con-*
ceivably may account henceforth

something like one-half of the

growth

rate

in

expressed

paper

was

assumed

in

this

The effort

was

limited

to

finding
3

An acceptance of these assump¬
tions would lift D J I A's Intrinsic

Value
But

ture

there

method.

This

payments.

hurdle

but,

It is

pretty high
the use of

a

through

the discount rate, less insurmount¬
able
than
it
seems.
Financial

perpetuity is brief compared to
the
eternity of philosophy and
religion.
Future
payments dis¬
counted

at

toward

7%

shrink

rapidly

of

pressed in terms of capitalization
of

earnings.
principle of present worth
is often used in studying the eco¬
The

of

financial and

even

in¬

in

detail

lished

in

soon

a

completed after
In

brief,

study

and

to

which
years

normal

to

coming

would

the

of

the

540

level.

dampen the values

Indirectly,

years.

be

also

the

implica¬

in

recurrence

ture of the shallowed

the fu¬

and shorter

cyclical swings with D J I A
ings
oscillating
around
a
steeply
in

rising

trend

line

earlier

the

level.

Measuring D J I A

years,

at

'

.

The

available back to 1915.

are

of the 43 years

course

In the

which have

since

elasped, stocks have been
subjected to practically all con¬
ceivable

political and economic
developments and contingencies

short

of

the

destruction

the

of

capitalistic system in this country.
If

trend line is fitted into the

a

fluctuating

of

curve

earnings

of

the D J I A for this entire
period,
it shows an approximate annual
rate

of

twice

growth

high

as

for all

of

4%,

which

is

the average rate

as

stocks.

From

the

inception of the

eco¬

nomic expansion that has marked
the postwar period, Fig. 3 traces

the annual ranges of the D J I A
and its annual per share
earnings.
It also extends into the future the

long-term

trend

anchored in

short-term
For

line

of

earnings

1915 and shows their

trend

through 1958.

earn¬

less

placed,
higher

a

;

}

pub¬

must

been

of the

trend

matters

lines

less

to

of

earnings. It

know

what

the

exact

configuration the
future
will give to the annual
changes
of actual earnings.
Their effect
value

will

be

small.

On

Fig. 3, a mathematical bal¬
ancing out of future earnings was
in such

made

a

way

to

as

assure

selection

decisive factors for apprais¬
ing Intrinsic Value.
Much more
optimistic
projections
could
be
ventured.

For

example, it could
the reality of a
higher postwar plateau of corpo¬
rate earnings has been
sufficiently
be

argued

that

well entrenched to justify a pro¬
jection of the historical long-term
trend of earnings growing at 4%
from that

new

level. The Intrinsic

Value

the

D

of

J

greater

severity

none-too-mild
The

than

1957-1958

the

slide.

arbitrary of all esti¬
future earnings is the

of

simple projection of the past into
the future.
be

done

For

by

D

J

I

A

this

indefinite

an

can

exten¬

sion of the long-term trend line
growing at 4%. It justifies, as of
now,

may

price

a

well

level

be

speculators

what

of

530.

This

investors

and

are

currently
in¬
stinctively doing in the market.
A

somewhat similar result will

out

bounds

of

of values.

growth
trend

of

A 4%

point,

our

long-term

or

While

pent-up

demand

trend

sion that the D J I A is still

priced.

If

the

of

still

value

higher

of

D

J

fairly

estimates

I

A

should

to
be
correct, investors
simply make larger profits.
To this
prospect, their objections
could not be strong. The risk thus
prove

would

lies

the downside.

on

So, for instance, the mere ac¬
ceptance
of
the
Market
Value
accurate

Intrinsic

as

it is in 1958,

measure

Value

siderable

of D J I A's

would

losses

mean

for

con¬

purchases

made at present levels. What
spe¬
cific
implications are contained
in

that

figure?

Since

1915, which is the earliest

date for

which

we

have

earnings

earnings trend has been growing,
as
we
know, at an annual rate
4%.

of

If

eventual

we

than

status

vailed

25

half

longer,

4%

rate

a

3%

rate

for

run

and

let

can

the

another

bepd it over
for(J25/Tnore years,

Such
the

in

projection

a

1958

level of Mar¬

ket Value right on the nose at 455.

currence

through

pre¬

century,

a

we

it thereafter at 2%

perpetuity.
hit

has

then

and

years

into

likely

more

which

quo

for

perhaps
basic

an

indefinite preservation of

an

the

that

assume

dampening of the trend

line's growth rate is

speed.

1950

at a
indefi¬

rate, both continued
nitely, already yield the conclu¬

jection

from

of

line,

3%

was
filling
war-time
hortages, D J I A earnings were
expanding with extraordinary

But

1958

extension

an

short-term

would

3.

reckening

rate of earnings

the

for

shown

Fig.

1958

Such projections may be im¬
pressive, but we shall leave them

by indefinitely ex¬
tending the short-term trend line

obtained

in

for

years.

and extend

be

A

then be equivalent to 715.
Since value grows with
earnings,
it would exceed, for the D J I A,
the level of 1,000 in about ten

data of the D J I A, its long-term

least

mates

I

would

as an

much

of

the

figure of 455, such

provide, even for the rela¬
tively near future, two long and
steep declines of the D J I A earn¬
ings.
They picture recession of

rate

of projected future earn¬
ings and of their initial level are

continued growth of the longterm trend line at 4% per annum.

projection of future profits
does not pretend to be a forecast.
But it is worthy of notice that

the

of

growth

the

figuring present worth, we
compute the rates of growth

be

theoretical

the

tion

1958

would

zero.

Earnings figures for the D J I A

has

of research.

for

it

Where the Risk of Error Lies

ex¬

determining the level of its application can
be
greatly
Market Value, a purely passive improved.
They will be described
attitude

the

The

i958, their average rate of grow 111

only trouble with this
is

that
is

the

pleasant

the result of

a

pro¬
con¬

delib¬

erate

settled down to 3% per annum.

years

The

1958
was

cyclical recession of

was

wider

:evere

J

short

and,

I

in

scope

1957-

test.

and

It

more

than its two postwar pred-

cessors.

J

important

an

Nevertheless, the fall in

A's
of

per

the

perhaps

share net stopped
two
even

previous
more

lows

impor¬

,

cur¬

rency

for

concept im¬
plies the need to estimate all fu¬

worth

irresistibly drawn.
an equity,

In

analysis. No attempt was made to
appraise the worth of the D J I A.

of stock

at

The Intrinsic Value of

dustrial projections. For the val¬
uation of stocks the techniques of

Intrinsic Value

also, the rate
very heart
valuation by the present
sense

is

it does

«?00

3%

a

the 4% rate of the long-term line,
could reflect both a narrowing of

This
300

And

economy.

rate of earnings growth from this

jective towards which the Market

nomics

>-

■

another

discount

of

a

AO

the

of

for
plateau of earn¬
ing power, in line with the gen¬
erally enlarged dimensions of the
D

dollars.

dividends.

and

tantly, its low did not even touch
long-term trend line.

the

higher

for

used

dends in this report. In round fig¬

and

Thursday, October 30, 1958

.

1950's

vital

result

on

500

of the earnings.
convenient valuation

a

dividends

In

However, if
ture

'

FIGURE

600

is

It

be derived from the

can

growth

They offer

We

is strong,

swayed.

market

of

projections of future dividends.

Since dividends flow out of

advance

the D J I A to heights which are
well
above
its
Market
Value

in this presentation.

made

earlier

illustrates

Dow

the actual ratio substantially

The

market.

2

the

cisively

picture of

process

an

more

trail, or
orbit,

an

Market Value is important.
listen with respect to

where

when

are

much

computing
appraiser.

must

zone.

Indeed
they are close enough to leave
little
doubt
that
the
principles

ratios

acted

hunter following a

a

than

or

hypothetical multipliers are
on
Fig. 2 with the
price-earnings ratios such as they
actually were during this period.
and

convey

reasonable Market Value

confronted

actual

to

quoting
dramatically

impression that stock prices
had reached completely irrational
heights, they were, as measured
by the D J I A, well within a

These

The

Only in

the

level of Fig. 1 was
the capitalization base.

as

Value.

this paper was

Macbeth

power

.serving

Dow average was
in line with its

or

Market

of

outset

multipliers of current earnings to
Compensate for the deviations.
Fig. 2 shows, since 1937, what
price-earnings ratios of the D JI A
earning

Value

the commentator mentioned at the

of capitalization

in the
stock market,
then tbe fluctua¬
tions of current earnings may be
looked upon
as deviations
from
it.
And
it
becomes possible to
compute
normal
price-earnings
ratios

the
below

year

indicated

of market value.

earning

habitually

astronomer

ognize reality,

July did the Average exceed 500.
In August and September, it was
still frequently trading below that
figure. In fact, at the time when

They need a higher priceearnings ratio to be able to reach

real

capi¬

Market

and Market

I A

selling

in 1958, cur¬
below earning

power.

the level

bird's-eye view

It is apparent from Fig. 1 that
during the first part of the cur¬

earnings in order to re¬
sult in the same level of value.
of actual

On

J

and

rates

.

to financial reward.

for the higher level

must be used

it may

comprehensive
discussion may be found in "A
Theory of Price-Earnings Ratios,"
The Analysts Journal, Nov., 1953.

on Fig. 1.
Quite obvi¬
much smaller multiplier

a

a

Stock

the

how

year

ously,

an

talizes earnings. A

high above earning power.
A multiplier of 14.8, applied to the
1948 earning power level, results
in 1he level of value shown for

stand

that

just

was

collectively

speaker

like

be mentioned that the above sum¬
mary

used as an illustration.

year,

springboard.

those

valued the Dow average in terms
of its capitalized earning power.
This

To close the parenthesis,

power

was

stock

dividends

rather

Industrial Averages
1948

the

market itself, or
buyers and sellers
who transact their business in it

fro mpage 31

.

juggling of the numbers of
during which certain arbi¬
trarily selected rates of growth

are

to

expected

doubtedly,

a

rationalization
to

defend

could

them.

lectual

feat

would

be

prevail.

be

But

necessary
a

Un¬

convincing pieqp of
built

the

to

transposition

up

intel¬

do

so

into

economics of the ancient political

Volume 188

Number 5790 V.

doctrine that the end justifies the
means,

>

:

.

D

J

an

-

accomplished fact, their future
will lose its dynamic drive

I

A

has

to

be

accepted

mistress

as

a

trend
A

Low

Estimate

trend

1958,

as

line

culminating
shown on Fig. 3, at
,

annual

rate

of

jection

can

be

2%.

Such

justified

which

this

unable

the

cal

Intrinsic Value

an

of

440 for

of

earnings

was

Still
also

contingent

cause

there.

A

investors

of

is

_

.

JL

The Intrinsic Values of D J I A

confronted below in

of

table.

:

*

a

^

-

effect of

;

"

IX TRINSIC

*

V ALU E S

Continued

as

■

from,

18

page

-

•

.

That

'

3% Along Short-

4% Along Lone-

Term Trend

Earnings

Intrinsic

Earnines

<.

Trend

Value

Trend

$24.00

530

$32.00

540

450

25.00

550

33.00

560

I960......

33.30

470

26.00

575

34.00

575

1965...

36.75

500

31.50

700

39.25

665

ticular political

in the same way as we

Value

440

1970

40.60

1975

550

38.50

850

45.50

600

46.75

1050

53.00

people in this coun¬
try who feel that the nation would

Valuation

890

difficult

a

we

and that profit margins are widen-

.

task.

off

if

there

no

were

come

Now, this doesn't mean
bor

is

going

to

start

a

7

f

,

ar<?

;;

.

/ Now, after all, the trade li&ioVl
is

a

large segment' of
We can no

.

The

reason

we

are

for those Who work for wages.
- Organization of workers in this

that la-r country has reached something
political like 17V2 or 18 million. Thes<?

sound

may

pie.
We still have people - who
the prospects are excellent for would like to weaken the trade

I

have over-

the other obstacles.

«•.
/.;/'• party or labor is going to go into
1
ridiculous, politics as such.
still have that type of peoNo Direct Political Action

Well," it

but

Appraisal

is

better

be

trade unions.

.

The

of life, that there

way

would still be

770

44.80

__

we

battle that we face fighting to improve the conditions

union movement has made to the
American

Value

32.65

-

that

•

Intrinsic

Trend
*___•

1959..

road

-longer take the position that wo
are
just a tiny, small minority

Term Trend

Earnings

$32.00

1958

the

the American people.

8% Along Short-

Term Trend

Intrinsic

is

movement

"

...

few
;;

*

i.

;

a

:/

jgoing to follow. 1

■

•

.

:

«f D J I A

V For Different Rates of Earnings Growth

;

sinners.

comparative

7."' ^: 7-—i''

punishing the entire trado

union movement because of

our

;
•

off

with: the; committees

operate

should not be confused with stock Congress, to draw up legislation
of market forecasts. Price reversals that can be helpful, legislation

influence

the

going to changd."We-Will be ready
in January when Congress meets
to coqper^te witti Congi*eps, to co-rl(

of positive

.

Recapitulation

outlook

discernible

From the point of view of investment policy to follow, the
conclusions, o^ t^is rjeppyt^re optimistic. Yet projections of value

33

growing can come without warning. ' But that. is designed to protect'J&p
being
investors can afford to be patient
uni°n movement.
educated
to
look
at
long-term
.
_
,
But under no circumstances wijl
trends without becoming upset by in the knowledge that value shall xve accept punitive or restrictive
the vicissitudes of the moment.
■i legislation
prevail.
which would have tin?

the

pro¬

the basis that while

level

new

thinking."
value

Dow average in 1958.

an

other

no

still in progress

was

than the sheer "power

for all stocks. Such
assumption would result in

personally is for 1958 and beyond based on
It may be ra- three
principal
assumptions

share.
on

had

annual

an

average

an

in

to

of men and gods."
And
private buying done while

lot of

the recession

which is the secular histori¬

speaker

to

tionalized

rate

only by

frankly /pessimistic

a

a

will slow down

and

y....
Statistically a more satisfying
way would be to extend indefi¬
nitely into the future-the shortterm

Vl797^

The Commercial and Financial Chronicle

•

active

po¬

people with their, families const!lute a responsible segment of the?

American

people, and

interest

same

welfare

as

in

we

our

has any other

have the?
country'^
citizen.

We know full well that in tho
hamper it in litically is because those that toy
with the idea of destroying the democratic way of life no one
aspects nor present my analysis earnings in the near future. every possible way with represmovement have chosen the po- segment of the economy can make
with a perfection I would have
A comparison of the earning sive legislation, and if possible deliked to achieve. But perhaps by power line on Fig. 1 with the stroy the movement itself, because, litical
battleground. . nlnoflir have progress at the " expense of the
They Inpt ttnni
*
-1
1
i..
A
7
tmmr
*
short-term trend of earnings on that is the real reason back of this shown us very, very clearly that rest.
we
now
have cleared sufficient
cannot

hope; to

exhaust

all

i

-

•

„

ground to attempt

its

The simple-indefinite extension

of the
line

i

,

n

_

Fig. 3 will make it clear how con¬
servatively and almost timorously

"oTd^asiiT to*ng-ter7trend lnvo?tor,s have been ap|)raisi"g }',e
the most natural of all level
°f earning power ot tho
earning P°wer
«

is

projections. rIt does not call for
any guesswork or rationalization.
And as indicated by Fig. 3, it is
not
unduly
optimistic,
leaving
room, as it does, for repeated and
declines

severe

of

current

earn¬

ings. This analyst is willing to
adopt it as his own appraisal of
the value of the Dow average in
1958 and subsequent years,
In selecting

Intrinsic
of 530,

Value

estimate of

our

as

for

which lies

1958, a level
the center

near

of the most recent price range of
the D J I A, we should not be

forgetful that it is well above the
estimated
On

Market

Fig.

Value

1,

of D

During

Value.

1958

Market

stands

at 455.

the

J I A

the

early

phase of the
market, this level
was
an
insuperable .barrier for
any further progress of the D JI A.
It repulsed with ease ail attacks.
But as the assaults were gathering
momentum, its defense began to
1957-1958

;

substantial recovery of corporate union

,

appraisal.

an

a

bull

1CVi;i

Vi

....

.

.

-

»

..

.

so-called

tion.
We
year

"right-to-work" legisla; ;
*
'
77:.
.7.
are facing in six states this
an attempt to
amend the
.

JIA since the end of the World
—Constitution of those states to proWar.
Fig. 1 reveals how slowly, vide for right-to-work legislation,
and at what respectful distance, to
provide legislation which is deD

_

r

ing

line cross that of cur¬
profits. And even then this

power

rent

crossing takes place hearer to the
low point representing the poor
earnings of 1958 than to the high

point plotting the better earnings
of 1957.

Having behind them now the
multiple test of three cyclical re¬
cessions

encountered

during the
investors
may
well adopt a more optimistic view,
Seen
in
this
light, the breakthrough by the D J I A above the

postwar

level
on

period,

of

Market

its

Value

based

concept of earnings that

a

may

in

the

values

than

a

speculative

mated
and

1958

an

esti¬

of

455

and everything

record

a

this country that cannot be

pared with

in

Jan. 16—w-

453.25

459.77

458.65

577.1—--

455.30

7

454*89

458.39

6-___:_:

.

453.07

•

"

__

.

450 13
448 76

455 92

457.27

.Mar. li_j—____

•

"

;

*

"

17

".
'

"

4*u'tn Intrinsic Value. But human minds
*)l.xU
bt»A

7 : 454.75

-

^

448.23

457.39

453.86

460.21

457.01

460.56

2

„

,

nAAolfitrA

459.56

5

462.38

461.12

6

465.32

463.67

ia

aiikic

t?i«aiv»

liiV»a

sensitive to doubts. From time

are

453,04

,

453.25

It is significant that the break-

*

raising their estimate of carhing power and of applying to it a
higher capitalizer. This should
serve
the Mai*ket Value of
the D J I A nearer to the level of

454

'

April 30_______^
May
1
"

to be in the process

456.80

_

*7 14__7__
-

seem

456.83

12

13___

.

a

tors do

'/

opening sentence:
"Available

evidence

suggests

/that the economy
hit its low
in the first quarter and that the
.

production low
April.

.

.

.

.

.

was

scored in

The ensuing recovery has been

amazingly

swift.

In

its

Oct.

13

issue, the same publication forea
further sharp lise in the

sees

last

Combined
with
the evidence
that factory
efficiency is rising at a rapid rate
quarter

of

-

1958.




as

has

such a the leadership of Harry
tremendous ,• contribution:
under
Bates
him

made

.

time, the present euphoria of
confidence
will
yield to fears,

bringing about reactions of stock
prices. One of such corrective
phases may be already at hand.
Postword:
The

Price

and

Value

main

appraisal of value lies primarily
in
its application
to long-term
trends. Many other factors
and
their interrelations, some of them
of an intangible and psychological
nature, also exercise their influence on stock prices.
Some of the early 1958 buying

probably little relation to
Much of it came from the
institutional compulsion to invest,
A great French writer was fond
of saying that "necessity is the
had

value.

and

,

who

others

preceded

of trade*
country—it has

to the advancement

unionism
an

in

the

effective contribution to

the welfare of the nation itself—

that this International Union will
be in the forefront

along with the
organizations of the AFLfighting for a better America.

other

CIO

,,

didn't try to pretend that it cudn t
exist. '
,
the American
We met it head on, and we are

With Gage-Wiley
(Special to The financial Chroniclh)

•

trade union movement.
; going to continue to fight to keep
ajr„liNoriJMjJ--aamcs
SPRINGFIELD? /Ma'ss; — James
And still we find people here our trade union movement clean.
Knight jJas been added to tho
in America who have made up We are going to continue to try to
•
Gage-Wiley & Co. Inc.,
their minds and who are pouring raise the standards of the trade ■ ^jr j National Bank Building.
jn their money in an effort to union movement, to try to see to . •
destroy this movement.
'
it that those who serve the trade
'
McKendrick, Hasaltine Add
Well, suppose they 'were sue- union movement serve it for its
(Special to The financial Chronicle)
cessful—what would it mean?
original purpose, for the very simMINNEAPOLIS, Minn. — An¬
Well, it is quite obvious that if pie purpose of building up the
you
weaken
the
trade
union standards of those who work for drew Warhol is now with Mcmovement to the point where it wages in this country.
Kendrick, Haseltine
& Wilson,
So this is our problem and we
is not effective, then it is going
Inc., 114 South Ninth Street.
to have an effect on the wage are going to continue to work on
it, and I am quite sure that we
structure in this country.
State Bond & Mtg. Adds
It is going to mean weak unions. are making some progress, but we
(Special to The financial Chronicle)
It is going to mean that the are not going to buy or be perNEW ULM, Minn. —Eugene J.
purchasing power is going to go suaded to the idea that punitive
NE
,
down, and if that happens, it restrictive legislation is the answer Gross is now with State Bond &
means more and more unemploy-, to this problem, that the entire Mortgage Co., 28 North Minnesota.
ment.
- *
.
trade union movement should be Street.
; ' ' *
To me, it is rather ridiculous, punished, as it were, because of
With Merrill Lynch
but there it is. We boast of the the sins of a few.
.
American standard of life, we
We took our position on this
(Special to The financial Chronicle)
boast of the American way of question some months ago. We
OMAHA, Neb. — Forrest E.
life, and we point out that the took a position that we would co- Heacock is. now affiliated with
American citizen, America's chil- operate with Congress or with any Merrill Lynch, Pierce, Fenner &
dren, its workers, have better of the committees of Congress in
Smith, 305 South Seventeenth St.
standards than any other place on drawing up legislation that would
earth; and we should know that help us eliminate corruption from
With Ball, Burge
those standards did not come as the movement, that would help us
(Special to The Financial Chronicle)
a
gift, that they came from the to erect barriers that would pretrade union movement.
vent some of the things that have
CLEVELAND,
Ohio — William
They came because the trade been exposed, but that under no
G.
Pollock
is
now
with Ball*
union
movement was able
to circumstances would we accept
stand up and fight, fight against punitive legislation that restricted Burge & Kraus, Union Commerce
the open shop, company unions, the trade union movement in car- BiiUcling^ members of the New
company guards and every other rying out its legitimate activities.
Midwest
Stock
Exdevice that they could use.:
So insofar as this is concerned,
.....
. .. .
And I say we'll take this par- the policy of the AFL-CIO is not changes.
Tir.iT

'

;

ii_

:

_

*

to

point Qf this paper
through of such a strongly held was t0 say that the valuation of
position occurred soon after the common stocks is not a hopeless
business recession itself: had task. It proved possible to comreached and passed
its trough. Pute a range of definite values for
This fact.was not yet unanimously the most popular average of the
acknowledged at that time. But stock market. By using the same
optimism -was already mounting principles of valuation; appraisals
in many iquarters. As early as can be made for any other averJune 16, the .Standard and Poor's age, or index, or any individual
Outlook, in its .section of Trends stock.
and Projections, had the following
jbe practical significance of an

^

membership,

corrupt people in the

Corruption Issue

com¬

other record

any

some

Well, this is a subject that the
AFL-CIO has had before it for
some time.
This is a subject that
the AFL-CIO did not duck.
We
didn't duck away from it.
We

of achievement in

Feb.

.4—

to

.

AFL-CIO Has Not Ducked

*

The trade union movement has
made

Market Value

are

^

High
452.16

2—

.

entire

trade union movement,

anti-labor injunction, the company
else.

adventure.

the

must be restricted because there

1920's, against the "condoctrine," against the

spiracy

like

lying

have
r

7 So

and the labor spy,

basic reappraisal of under-

they

nation covered.

union shop or the closed

have proved too timid, locks more
a

until

,7'"/
: stronger TWe are going to continue?
just as we fought against the to
rfipp entirely; ' "" "
"
try to make democracy work a
other methods they used, so we
That fight is on, and, of course,
little better.
must fight in the political field,
we are engaged in that fight.
We are going to continue to try
and I am quite sure when the chips
to raise the standards of life off
are down that we will do as good
Recalls 1920's Anti-Unionism
the American worker, and we art?
in the political field as we have*
Locals
throughout the entire
going, to continue to try to do
done on the picket line or any
country are making their con¬
something about unemployment
other place.
tributions, especially in the States
which is a threat not only to tho
Now, in connection with this, we
where this thing is on the ballot
trade union movement but to tho
this year, and we are going to have another subject that comes
nation itself.
>
♦
v
continue to fight just the same up to mind.
That is the policy of the AFLPart of this anti-labor campaign
as we have fought ih the past, just
the same as we have fought against is predicated on the idea that la- CIO, and I am sure that this Inthe so-called American plan back bor must be curbed, that unions ternational Union which has ma do
out the

corresponding
Intrinsic the world. There is no trade union
Value of 530 is quite wide. It may
—movement in the world that has
Close
not yet have been securely bridged made the progress, that has de446.91
by recent price advances. Inves- livered the goods, at it were, to its
445.23

Dec.

gQ we have c0me to the conelusion ; that the things that we
advocate for the good of the coun|ry must in the final analysis be?
for the good of all the citizens off
^le country and our members in
partiCular.
7 7
'

a^°tos,cit"that is try towe are America
why make g°ing
continue

of actual earnings. Not until the
1957-1958 recession does the earn-

Still, the gap between

and Its Rise Above Market Value

:

they can set us back, they can
hamstring us,/they can impede our
progress by legislation.
They did that through the TaitHartley Act, and they have don^
it through right-to-work laws ana
they are continuing to try to give
laws

weaken.

Culminations of Advance of D JIA

..

movement,

_

.

„

.—

_

.

r

The Commercial and Financial Chronicle

xxm i

i*

the

3%%

for

9

Continued from page

a

Government Debenture

defaulted

FHA

bearing

banker

the

a

higher interest rate.

Financing the Replacement Fleet
bonds at

interest rate of 4.40%

an

4/10ths of 1% above the compar¬

able Government maturity which
postponing its financing in
is in line with the new issue pre¬
June when it was unhappy with
mium shown on Moody's chart.
a
rate of approximately 3.75%
An interest saving of Vi of 1%
which the investment bankers felt
would be necessary to sell the on a public issue of $10,000,000
same security at that time. Since
20-year bonds which has a sinking
the financing of the replacement fund resulting in an average life
fleet will be spread out over 10 of about 12 years, would amount
to
15 years, a company should to
approximately $300,000. This
obtain a fairly average cross sec¬ saving is offset in part by the
tion of available interest rates if substantially higher cost of selling
it does
the financing for each the public issue. The expenses of
ship as it comes along at various a public issue of $10,000,000 would
intervals
during
the
15
year probably run about $200,000 but
well
be
reduced as
the
period rather than trying to out¬ may
precedents are established and the
guess money rates.
large legal expenses incurred in
) A chart, based on information

after

furnished by Moody's Investors'
Service, shows the variations in
the yields on Aaa corporate bonds
and U. S. Government Bonds over
the last several years

that newly

and the fact

issued corporate bonds

interest

rate
Oif y2 of 1% over comparable
corporate bonds that have been
outstanding for some time. The
generally

carry

Government

an

for

selected

Bond

comparison is the 3*4% issue due
which

1983-78

closest

the

is

maturity Comparable to the recent
Grace

new

true

in the

Title

of

issue

The

issue
case

XI

Bonds.

premium is also
of newly issued

Government Bonds

Witness the

as

connection

with

clearing

Administration

time

agencies
the

the

for

minimized.

first time are
offering in

example given would have
approximately $125,000 less.

ment

It

market.

draws

a

issued Oct. 8. In periods of rising

both

on

preliminary count

purchasers and
ranged

were

over

400

that the amounts

from

$2,000 to $500,000.
They included individuals, small

prices, it is often necessary to
pricC a new issue substantially insurance companies, small trust
small
above
the
then
banks,
pension
going
rate
of accounts,
traded securities of similar qual¬ funds, college funds and at least
ity. This is due in part to the one State fund.
fact that a new issue doesn't enjoy
The bonds were given the high¬
known

as

seasoned

a

investors must be induced to sell
an

y<-

to

for the

pay

...

.,

.

'

,

,

Public

<

t

of advantages which should be
weighed by the prospective bor¬
in

consultation

least

Aaa, by Moody's and
leading investment
service
suggested
the

one

advisory

'^purchase '"of the
its

bonds

accounts.

with

broader

a

....

offerings and private
placements each have a number

rower

rating,

at

his

issues.

It

to

This

public acceptance

Fublic and Private Placements
.

est

new 'of

carrying the higher rate.

one
t

bond

old

distribution

is

several

indicated

should

lead to

anticipated

that

funds

and

who

others

required

by

invest

substantial

a

law

or

policy
portion

to
of

their funds in Government obliga¬
will be substantial buyers

tions

State's

rate

a

Grace

financing

of 4Y\%

compared
with the historic rate of 5% (in
a few cases, 4%%)
for the over
$235,000,000 of Title XI Insured

Mortgages placed privately

to

up

this time. A major reason for the

differential

of

known

%

of

Grace

1%

is

the

and

name

its

long established operating record
for
a
large fleet with regular
trade routes compared to the unestablished single ship operators
that have
XI

previously sought Title
financing. The other reason

for

the

rate of

differential

is

the

lower

approximately y4 to %ths

of 1% normally commanded
by

public

offering.
that

reasons

a

a

The
principal
public
offering

normally commands a lower in¬
terest rate are the broader offer¬

ing

the

and

'resulting

broader

marketability

factor which permit
the investor to resell his
bonds at
any time.
A

trading market in

bonds

was

day by

established

the Grace

on

the first

of the large Govern¬
houses and they were
traded today at 101 which
means
one

ment bond

a1

yield

that
over

of 4.17%. I am advised
the jvolume of
trading was
100 bonds on Oct. 15
which

indicates
view

U.

S.

of

a

obtained

are

from

each

Attorney
General.
The
Attorney General gave an

opinion last May that the Govern¬

recent

carried

well

once

ment

The

the

relatively small

of the original

issue.

The

Interest rate of 4V4%




was

in

size

initial
about

private

purchasers

placement

/v;

generally

Insurance

the

equiva¬
Government's obliga¬
tion fton its
interest bearing
securities. The Comptroller of the
Currency also issued an opinion
in
August
that
bonds
insured
lent of

was

the

under

Title

XI

eligible for
unlimited investment by National
banks
Title

which
XI

investor intends to hold the bonds

have

issue

is

willing to
sacrifice
marketability
for
a
higher interest rate. Our, experi-

been

possible, in

because; of

a.

the

holders

-v

•

The

investment-

has

an1

will

- prepare

\

/

v

banking - firhi

experienced
with

staff-which

the

in

effect
the

U.

S.

gave

the

status

same

Government

large

the

number

-

Covering Forward Commit-

(1)

sophisticated bondholders' than it i
is

is

possible in the
placementto

private
firm

commitment

construction

ease

of

to

consents

secure

bondholders.

a
a

-

Role

lenders, if management
a
private placement,;-

on

preparation of >ipubifc?
goffering circular' if it'decidefKfo :
!
public r°ute- Irivestfnerit >

,

R

entered*;

into for the

tutional

firomthe; decides

f™^??r"idely

a

time

is

contract

-

obtain

the

at

,

^vestme^ Banker,

bankers

closely' with

work

the r

Many people have asked' about ^lrm s commercial bankers arid in!:,
the functions and uses lofiihvest- tman^;.ln^tances:have worked 6ut ;
ment bankers in co^porate-Kfi-hanr-f' combination financing programs *
cial
planning./ Some- thipk i 0f -involving both short-term loans '

bringing in an investment banker :rhy ;|he 7 commercial banksand
only after the decisions have' been long-term loans by-institutional or
costs.
Commercial
banks
have" made, whether for .privatejplace--' Puhhc investors,
-t'->
made many construction loans in ment or public offering.
Naturally;
Our experience prompts me to
this field.
Most
of these banks as an investment banker*who has1:
encourage, first; covering forward
require that the borrower have a participated actively'in this-field,' commitments
well
in
advance
take-out commitment at the time my viewpoint may . be somewhat
and
before necessitv forces the
of delivery of the ship which
will) conditioned. Nevertheless; there; issue, and second, to do the fienable the
company , to pay
off are many definite advantages to naricial'
planning
early,
taking
the construction loan. We
have taking
investment bankers .unto advantage of the
cooperative and'
seen enough of the
tightening of one's confidence at an early stage .confidential
advice, available
credit in 1956 and early 1957 arid of financial planning.U:.R .' :
? • through
commercial: banks
an'd '
again at the present time to inIf the bankers are' experienced experienced
investment bankers.! •*'
dicate that one is not always sure
of the actual availability of the
^ '■
'
'
money, at realistic rates, when he
Conttnwea from first .page < £ 4 ,
iri
needs it, let alone the terms on
*r
t.
•J'IV
cast

accurately the actual

money '

-

,

which

is

be obtained.

can

Investors '

'

-

(2) Different Classes of

j

S

-S'-.-j'..:-

•

While
the

of

the

.

issue V dogmatic
statement praises ""two .variable .dividends, I have taken
timely questions: (1) Whpt does' the period from Jan.
1,
1922,of money in the public the
record actually// shpW? land; down to date, with rhore precise

source

a

recent

Grace

for

market

Line

public

has

class

a

indicated

of

security; (2) has there been-such'a fundamental change in the invest-

which many investors consider the

of the

tion,
well

shipping industry. In addinot all borrowers are as

known

the

as

major

sub-

sidized operators. An institutional
investor

is

able

to

turn provided by

the-list

make

investigations

of

stocks

the

Standard • &^Poor's* 90Composite IqdeiO against

Stock

indeX

c 8 11 a b

solely

on the Government. guarantee. A loan that may not run to
or

risk

some

which

on

that

the

there

lender

is

,

between

Public Housing Author¬
a
Title XI Bond is

a

ity Bond and

must

°f

in

of

case

default

on

the

latter, the Government is obligated
to pay the entire
principal and
interest to
time

the

event

lender

in cash

at

default, whereas,

of

in

of

the

local

Government is obligated to con¬
tinue to pay to
maturity. In case
of a default on an FHA
Mortgage
the
Government
substitutes
a

hiSh-quality,

non-

pattern

interest

races

of

high
the lender might be

in the position of

the

5%

rate

it

That

having to accept

is

to

the price for

than,

rnore

dividends.

regular

say,

common

stocks

long-term

as

.

■

.

?

,

is

in

the

era"

new

There may be

90%

ratio,

considerable logic

bGt

td'the

notion that investors will not jong
treat
ture

as

virtual

a

growth

in

jn each case, is

certainty

dividends

only

a

a

fu-

whidh,

reasonable

expectdiipn 01 a poieniiai real-'
a Potential reaiizable .at an indeterminate future
expectation

of

/

date.

;

since

^

.

extravagant

discounting

requires the support'

investor behavior

or

excessive speculative participation
jn

the

market, its duration is al-

most bound to be

relatively short 2
yield the same as,' or less Tf js not snrnri«?rnff: that in the
established-t
i
,;r.
fLl 1S not surprising mat in me
record of earnings will be able
^an' Preferred stocks. t^Vhen this jast 36 years, the return on comto obtain long-term Title XI fi- kind of confidence nr.; optimism
mon
stocks was 90% or more of
nancing in the private placement: does not prevail, the reverse sit- +hp rpfum
nn
nrpfprr^H
may

be

operators

that

other

with,

well

knowii, wjn

an

+

...

Confidential

of

fidential

memorandum

by

■

,

this

relationship

tween the valuation

be-

of fixed and

•

private placement

ally prepared

for incurring - dhe. .risks
associated with variable common
study

Treatment

Information
a

return

offerto8.' stock payments.
To

Ste

because of the low rate.

the

is

a

con-

of
time- Th-we
four occasions, totaling 99 months,
jn

1 See

the

aut-hor's

v

.

article

T.

,

"What

Yield

A°,„^
reasons

1955>
behind

ra(jQ

this

choice.

are

ratio
now

of

(.omrnon

raU° " C°mm°

was

less

in the

than

fourth

to

oreferred

?

C

stimulating discussion of speculative influences in the present market,

fil

p'pn 15'16 ur^o^.Tthe'

the

We

0£ these periods, with the todayV

see

gener-

investment

which

90%;

2 For

^

re^t

L

Uati°n WiU be trUe

«

institutional'W?1 deI"and a boI\!^

although the large
buyers
that normally purchase
private placements did not partic-

In

periods

below

or

.well-assured,

Now that Grace has established

(3)

in

...

magic

there

^ industn|l\ preferred

...

.

K

fng.t0 bf in will-,pay as much ,ot toe
an upiv^dirdc^10n» investors
0f irrational

with single ship corporations and
record of established earnings. ,as»

3%% Debenture for the Mortgage
rather than pay the
mortgagee in

Thus,

,o

of the later 1920rs.
n0

have

Public

Housing Authority's inability to
pay
principal and interest the

.mo

„

£ant appraisal of the '

c^sThis pi ovides a . direct
comparison of the price investors

s
.

no

a

beginning+

but - not the extrava-

the rate of return provided by^my

case

Housing

Mortgages.
The only substantial difference

•

(in ± this

whether the ship can be operated

maturity

the

equities

representative

a

common

of
the
less known operators to determine
necessary

have been marketed for a number
of years such as Public
anteed

observations.; from

of 1926.
In the.; middle
l920's,
ment situation frorri^ those ye^rs common stocks typically provided
in which the record, waff compiled>a return equal: to about 90% 6f
that the lessons drifived from it the return on the group of highno longer apply?
'grade preferred stocks. This re;
For a variety of reasons, ! have fleeted,
presumably,
confidence
chosen to measure the rate of re- in common

equal of a Government Bond, the
public market, may not be adequate to meet all the requirements

.

Authority Bonds and FHA Guar¬

•

borrower

involved.

paid over the years-Tor a
enforce the guaranty, is less atr
foliar 0f variable dividends with
hoped that Title XI Bonds tractive
and, therefore, requires a
will
compete
successfully
with higher interest rate. As indicatedpnee paid for a qollar O| fixed;
certain other types of guaranteed
above
the
market
to
date has dividend
income. . Obviously, :if
Government
obligations
which shown that the
large institutional-they feel that the variations are

the

ou* Plar,s, in broad /outline and in'
;

public

It is

the

are

goippJexity. the necessary background memo-1
of bond7 randum to form
the-basis-for a
If ;it;bf&6mes financial: decision. This memeence
has
been
that
Very
few necessary to seek amehdments at. randum can be
reshaped for use
purchasers of private placements; a later date it is easier andTess either as a *
confidential memo-5
have resold them at a later date, expensive to negotiate with
$ few randum for presentation to instiand

-

obligations.

that

confidential, expertsounding boards .against
which one can throw, the many •'
Questions that arise in working

fl^at have -been
,

are

Bonds

direct

as

bankers

dealt with in other brjvate place-

ments, have often been .able to
work out terms that'.would-not

.

may :

Investment

money. market.

operating ,problems
Investment

r o w e iv

various situations

until

maturity and

principles of which

aPP^e<f t°a particular problem.;
.^cy ^re in close touch with-the

Maritime Administration end the

whose

to suit,

f>eriepce m other types^of.financ-

;

bankers who have had experience
with
the
requirements -of >. the

participations
may range from $100,000 to $10,000,000. Generally, this class of

cash.

very active interest

the peculiar
of the b o r

\

involves from 1 to 15 institutional

are

opinions

able

<

of tlio Advantages of a

Private Placement
A

of

T»mi«*"«•£%a;'sitaation/They cab ••alsa
e*otiatedTe^.:- v. '-S1V?_the benefit of -their exr A

;

State

Among the advantages of
offering are:

(1) Lower Interest Rate Obtain¬

Some

knowledge

P'e^-n<3Jelpespecially a
Set -U£ tailored
program

placement

^

■

the

this class of security becomes
better known and the necessary

public

objectives of Title XI Insurdistinguished from straight

Merchant Marine.

later

on

investment banker in the light of
the particular business situation.
a

news-

In a private placement, because
of the limited number, of* piirGovernment
loans
has
been
to chasers,
it is often possible to
create public interest in the U. S.;.negotiate
special terms'. to " meet

It

chasers of the Grace bonds is not

interest rates and

is

offering
publicity in the

purchase of the bonds
large and small investors who are upon delivery of the ship. This
unable or unwilling to participate assures the ship operator that the
in private placements.
While a money will be available when he
complete
analysis of
the
pur¬ needs it and permits him to fore-

indicates that there

market and in part to the scarcity
of money which means that some

the

use

background f and

ance as

(2) Greater Source of Funds

Generally speaking, the public
market provides a larger source
of capital than the private place¬

yet available

what

also

of'their

the benefit

bor-

the

class of buyers who may ;
/4V
Grace's facilities. One of.•(4?

a

ship financing, they

give you

can

ProJecie? operating figures. Many .Maritime Administration or otherco™pames object, .to
public top Government agencies-; have
received'beca"f® J*
re<*ul^€d"'approved in particular instances

of

and magazines and estab-

papers

in the field of

lenders
giving
background :in-

offering tL

Grace

recent

substantial

lished

services

,™bUc

a

necessary

ments Well in Advance

cost

new

declining bond

other

and

A private

recent

spread of almost 1% on
short-term Government Notes

the

various documents with the Mari¬

and

rowerby

presentation solely to

Thursday, October 30, 1958

formation on the comp^y lnclud-r vvhat other cofripanies have done
similar situations,: what :*he;

:

v

/

.

Public interest is created in the
product

And the Investment Banker's Role

the

(3) Public Interest

for

institutional

..«

a

Graham's "The New Spec¬
in
Common
Stocks"?, The Ana¬
Journal, June, 1958, pp 17-21.

Benjamin

ulation

lysts

•

■«

Volume

Number 5790

188

.

The Commercial and Financial Chronicle

.

.

C1799)a 'tyC
35

i

Stock returns just
behooves

under 80%. -It 'pened

to look at' what

us

hap-

after

the

previous

three

'}; "**'T

y! v.?

Such periods:?-~

(3t
<4>

Jun., 1957

To

From

'.

On

Extent.

'

(21

1929

Jun.,

84.7

1932

Feb.,. 1934

Mar., 1935

25.7 r:'.

that

equity money is reasonably

Feb.," "1937

Mar.^1938

45.4

•

generous

(to date):

Augr.v 1958 to -the present

relationship reflecting the
supply qf equity money

yield

6 months

to Sep., 1957 and

priced, all things considered, there
could persist a new and different

'

>•

otfier hand,

the

Sep., 1927 to Nov., 1929 and

Sep-.,

demand

:

situation

in

the

stock

market has changed."The greater

if corporate
management is still not convinced

-Decline in Stock

*Duration
"
N • .■
Jan., -1930 to June, 1930
31 months
May,. 1933 to Dec.,, 1934-19months
Jun.-, 1935 to May, 1937^23 months
Period

(1>

stpeks might again come close to
rates on fixed-income securities.

relative to the modest demand.

availability of funds from genuine
investors, not dependent on bank
credit, is undeniably a new factor,
Unless business organizations increase the equity portion of their
financing programs, we have the
basis
for
a
new
alignment of
yields. While I believe that some

Profit-sharing, stock purchase, and
increase in equity financing lies
era" savings plans are also swelling the •;v
Fear of Inflation
ahead, I cannot demonstrate that
1928r1929, the monetary, total of funds available. A poten-;
Many * ■- qualified'f observers be¬ either the immediacy or the size
inflation fears of 1933-1934, or the tial future, source would be the
lieve that present yield relation¬ of such a change is going to en¬
"p:annecx" recovery 01
writing o£ variable annuity conships no longer have their former large greatly the demand for
Such is the record. Whetaer th?

counting oft the future
Will

same.

it

the

be

were

not

in

he

19:7-1958

intimidated

that

dif-. not

so

we

by the

tracts

this;: Financial 'intermediaries

same

time? Or is the situation
ferent

byT leading life insurance "
the:;.comparties.%" r4}.;<?•

extravagant;., dis-

need

dusty

records of the dimming past? Tne
answer to this question can ma-

much

common;

.more

stocks

than

25%

significance" because

of

that

of inflation.
provide far

we

hold; Even
of ?all

outstanding,

but

live in

though

from

perfect
of

erosion

their share is .gradually increasing?" of the
Trusteed pension funds, for ex-

stocks

the

fact

against

protection

purchasing power

dollar, it is believed that

the best available hedge.
ample,, owned about 2.15% of the
Accordingly, one may not seri¬
terially aid in the solution of to- ' common stocks outstanding at the
ously object to the necessity for
day's investment problem.
end of 1957, but by 1965 they couldpaying a premium in the form of a
i A reasonable approach to find-; readily .own
5% of the total. In'
ing the

they

the

an age

are

lower immediate

nn

would

for pro¬

return

to the same period of time, mutual'
tection fro»~ « hazard of indeter¬
princi- funds could increase their owner-;,
minate ; seriousness.
Stated ar
pal arguments or reasons for be-fship frdm just over 3% to 6% or*
otner waj-, u..c may observe that
keving that :."this' time it's dif-;.7%. The continuity of this kind of
be

answer

examination

ferent."

These

appear

of the

seem

if the fixed dividend return is ad¬

to- revolve/

buyirigr provides
an
underlyingjusted for loss in purchasing power
around three principal ex plana-; strength to the market which may
over the next decade, it proves to
tions for the generally recognized? well *ericf to'-.tiarrow the range of
be quite inadequate in real terms.
fact that; corporate earning power fluctuations during recessions ofThere is probably no more com¬
is being valued today at avverythe JL957-1958 Variety? Such eviplicated problem than this ques¬
generous price: V;/?.; \
,f;t>^?.:.!.^^cfences of;greater stability will, of
(1) The

long-term}course, "tend tb attract

favorable

.

even more

funds.to the equity markets.
?. •
(2); The supply of and demaiid? Invcohtrast to this burgeoning
for funds situation in the stock supply of} equity money is the
market. : •};
-;
V}
sluggish demand for it. Net new
v.
(3) Fear of inflation.
;issues of stocks and securities con.;
'' " . Avertible into stocks have increased
:
Outlook for Profits *
"only moderately despite the ur-}
An -optimistic view;.of the out^ gentdfthxphd
fpr long-term capital,
look for profits can be supported The most:coipmbn explanation's
by the breadth and vigor of the ob.viobsly not,the whole story., It
current business recovery and by is usually; said that the deductithe prospects for growth inherent .bility of interest payments for corin bur dynamic economy. The out- porate income tax purposes makes
look is definitely favorable, yet debt forms of financing so much
even; the optimists
expect that less expensive than equity; Sink1959 profits may not exceed the ing fund flyments arc not deduct1957 : level. Adequate coverage, of ible and, other covenants may be
current dividends, rather than sig- restrictive . on
the flexibility of
nificant increases, seems to be the financial management. High perreasonable expectation for next sonal incbrrie tax rates encourage
year.
Validation of the present equity:f.inancihg through retained
level of stock prices would depend earnings/but the new institutional
upon' the assumption that the holders have no such objection to
profits,

.•

.........

..

,,

...

us

.

be

a

decade indeed.:

prosperous

projecting creating. /importance as mutual
objectives and hopes into the dis-. fuuds and vpepsion trusts become
tant

future

as

though they were

realities is neither

more-active,^,,the field of equity

new ;h0i? differ^
, v . '
•
.: previous periods -of exPerhaps the principal reason for
travagant discounting of the fu- the reluctance of corporate man-'
_

erit from

tU|*jE.

In this respect, the present
striking resemblance to all

bears a

agements to, sell equity securities
is the /dilution" problem. In this

probably

widespread
and
deepseated than ever before. There
more

be an unwarranted assump-

may

fears

a

On

the

future.

This

is

a

familiar

}

sober,> realistic

*"
view of the
enthusiasm

facts does not, support
for stocks at current

tection

tion
;

prices

as pro¬

against the kind of infla¬
have been having.
But
,

we

a practi¬
remain the only
of investment available
range of investors for

this is not conclusive. As
cal matter, stocks

large
to

a

area

wide

and

At this

(ie., more than 10%) above
price paid for fixed dividends,
differential

Under

existed

the

circumstances, how-

one

well

this fact of life contributes impor¬

not

interprets past experience in the light of present conditions, there is no adequate basis
for concluding that stock prices
are bound to collapse in the near
ever,

future.

No doubt,

In point of fact, one may

are only at
protracted period of high valuations for good
stocks. We could be in the early
stages of a major bull market
argue

that

the beginning of

we

a

previous periods of confidence and period of persistent pressure on tantly to the supply of funds in
optimism; The unusual aspect of profit,Jjoarginsj it has been diffi- the equity markets.'
the present sentiment is: that it cult to maintain the rate of return
.^Thus far we have not had wide¬ which could last for several years
was generated in the fourth month
earned pq'the equity without libanci
even
include an
explosive
spread public participation in the
of recovery frpm the trough of the eral; use of the leverage provided
preference for equities as a hedge phase before it runs its course.
recession, instead of in- the late by borrowing.. Widespread confiagainst inflation. The savings sta¬
alttrn+atlyi1
stages of a protracted boom. Fur- dence in the outlook for business
tistics
clearly
show
that fixed possibility is that the market will
th'ermore, this has happened just has calmed the fears regarding
dollar thrift arrangements are ex¬ be characterized
by greater soafter V corporate
earning
povver debt which existed in former peperiencing vigorous growth. The bnety in the months ahead. This
proved about as vulnerable as riods. " Company
attitudes have fear of inflation is
obviously not would be the result of several
eVer to an average swing of the
been similar t0; investor sentiment
uppermost in the minds of most possible influences.
business cycle;
in reflecting the belief that comfamilies, judging by their current
(1) A greater volume of new
The argument that present, mon stocks will sell substantially attitudes
about
incurring
debt. equity financing.
prices are justified by the favor- higher over the years. Why should Rather the inflation psychosis has
(2) Increased recognition of the
able business outlook so that we management dampen this bright been localized in the numerically
sluggish trend of corporate profits.
can ignore the lessons of experiprospect with a shower of new small investor group and in some
(3) A subsidence of the more
ence seem unimpressive.
We can common shares?
corporate managements. Will it irrational components of the presargue much more effectively that
< But there is a point at which, all
spread?
Is the threat so real it ent inflation fears.
the market
is already liberally things considered, equity money is will become
recognized widely by
I happen to believe that this
discounting: about all the improve- not high in price. Are we not close savers? Only time will tell, but
shift to greater sobriety
is the
mCnt that can. reasonably be exto that point?
If the growth in there are good grounds for believ¬
most likely outcome but obviously
pected in the next several years, earnings is anything like the esti- ing that the current wave of infla¬
I do not know what will happen
Surely, \v.e must find other mates of the optimists, the "dilu- tion fears will subside in the in¬
and my guess is no better than
gronnds if we are to ignore past -lion" will be only temporary. It vestor group without being widely
yours.
;
experience with present yield re- may Well be,-therefore, that we communicated to others.
laiionships.
"
shall see a gradual shift in corpoImplications for Portfolio
This Time It's Different?
;
:
:
rate financing toward a somewhat
Management
The Supply and Demand
higher proportion of equity. Even
What, then, can we conclude on
Whatever you may conclude as
.
Situation
.
a modest change could completely
the question of Whether this time
to the outlook,
there are some
At one time or another in every accommodate the generous supply it's different?
In facing today's
bull market, there is talk of the of equity-money. Thus, while the
investment problem should we re¬ fairly specific implications for to¬
scarcity of good stocks. Certainly present supply and demand situa- spect or ignore the warnings day's portfolio management poli¬
tHe situation has changed dras- tion favors firm and rising prices, which have been reliable in the cies. Common stocks are neither
priced nor
grisly
tically since the early postwar; we are at or close to the point past? What is new and different attractively
They are probably
y^ars, during: which there was a where: the attractions
of equity about today's investment environ¬ overvalued
fully valued as best we can judge
serious shortage of equity money financing are such as to induce a ment?
The preceding discussion
with our imperfect measuring de¬
because only a trickle of institu- more active demand for funds,
may be summarized in these terms:
vices. In a growing fund, such as
tiqnal funds went to stocks. With
* If this is a reasonable concluIn the first place, the supply and
a pension trust
in which orderly
pension
funds, and
investment sion; we can logically expect an
accumulation
is
possible, there
3 For a good brief discussion of this
companies steadily enlarging* the end to the process of the upward
scope of their participation, the revaluation of corporate earning subject, see "Some Observations on In¬ would appear to be no reason to
flation", memorandum prepared by the
hesitate about continuing a longmarket for equity capital has a power which started in late 1953.
Economics Department of Bankers Trust
range purchase program.
In an
plethora of funds at its disposal. The current
return on common Company, Aug. 4, 1958.
.

,

^

pects

a

recognized

already

are

in

.

The first public distribution pf
stock of the Chock Full

common

O'^uts Corp., a restaurant chaip. V
and coffee company,. was made
on Qc^
through the offering 400,000 shares by an underwriting group headed by F. Eberstadt
&
H Wfls quickly oversubscribed and the books closed.
:

The

the

,

..

..

..

which

stock,

of

account

was

sold for

William

Black,

President and founder of Chock
Full O'Nuts Corp., was priced at
$15 per share. None of the pro-v
ceeds of the sale will go to the
company. An additional offering
was made by Mr. Black to em¬
ployees and officers of the com*
;

pany.

The company roasts, packs and
distributes the Chock Full O'Nuts
brand of coffee and operates a
chain of 26 counter-service restaurants
located? principally m
*New York City. Two additional
restaurants
are : scheduled
fop
opening within the next month op

long, nor is. it extreme. .*?We
have
recognized
that both the
supply of: funds and the fear of
inflation are operating to continue two.
this relationship.
The

possible capital growth and hedg¬

inflationary threat.

has

for

ing against the unknown extent of
the

there

greater consciousness
of the fact that favorable pros¬

char-

acteristic of all bull markets

The

A

should be

hand, there is
different about the
liberal discounting of the longer

the

ing onj this point.

of in¬

program. In the appraisal
<Uvidual securities,
too,

new or

ally

v

risks now incurred in*,
aggressive stock
acquisition

other

nothing

earnings.

test the ability of corpo¬
improve real
Certainly the record of
the last few years is pot reassur¬

the greater

buy and hold equities is likely to
remain very strong.

of

rise in living costs

increased of

has been

awareness

Son aTtSthe Sbmty"oTcorporate current prices The: realization of
managements to increase profits A168® prospects will not be so
under these conditions, yet stocks JWh a reward for the decision
are
the only practical hedge for to purchase as it will be a mere
most investors. The motivation to validation to the price paid,

tion may

liberal payout,

This phenomenon of

Secondly, the expectation of in-

hopefully his

and

dampened

an

flation in the minds of investors is

rate managements to

policies. Likewise,
''>7capital gdinsfaxes must be ofde-5

very

future.

point, it is useful to return to the starting point of the
an num.3
This
would
allow
for yield relationships because they
some years of comparatively sta¬
provide a tangible, specific yardble prices
as
well as years in stick for measuring the market's
which the rate of increase could be appraisal
of
corporate
earning
substantially higher. < Considering power. Fof the relatively short
the profits squeeze that this kind
period of six months out of the
of a cost-push inflation produces, last
seventeen, the price of varieven this moderate pace of infla¬
able dividends has been materi-

..

will

current

which is
unlikely to exceed 1% or 2% per

.

196C's

near

unlikely to persist for long periods
of time. The plain fact that a dollar
of
income
today is worth
inflation
are
well
grounded or
appreciably more than a dollar
grossly exaggerated. Without at¬ several years hence may be overtempting to review all of the fac¬ looked at times but not ignored
tors here, it is my opinion that the
indefinitely.
preponderance
of
the
evidence
What May Happen?
suggests that we have in store for
of .whether

tion

outlook for corporate

funds in the

^

personal trust, also, it
se'em ' reasonable".to, buy'
stocks, along with fixed income
securities, in proportions appropriate to the fund.
; T
This sounds like ''business as
usual," a simple reaffirmation of
the
policies
widely
advocated
during recent years. So it is, except that the warning flag is flying.
The
enthusiasm of
this
observer
has
been
materially

,

of

+

individual

motive power was the "new

result's

.

Wotild

madness of

the

n

r

,

coffee is dis-

company's

tributed in the Nev^. York City
metropolitan area and in 12 states

^as£ernv?ea

^

O Nuts has become the third
largest-selling brand of coffee
£ex<jJu<*j.n£ grocery chain brands)
J?
^lve ^ears smce
incep-»,
•

°J?;

u

..

^

The growth of the company has
been financed out of retained
5ariiln^u a
n0A^,' 110
dends have
paid on the
J01^11!011
directors intend to establish a policy of paj^
*ng quarterly dividends and to
■

u

declare

an

initial dividend on the

stock of 25 cents per
payable December, 1958.
Pthe
ended Jul
31

common
For

1958

total

^

of the

net saleg

were

$24,634,177. Net income
taxes for this period was

after

$1^13,076, equal to $1.64 per share
on
the common stock.
The net
saies for the previous fiscal year
W€re $22,135,849.
•
"
"

.

-

'

«

Pianicti i/irecion

Geoffrey R. Mellor, a general
m t
inv^stment firm of
W. C. Langley & Co., members of
New York Stock Exchange,
has been elected a director of ttie
Western

Development Co. of Dela¬

ware,

Mr.

it has been announced.
Mellor also has been a di¬

rector of Missouri Kansas

Pipeline

1937.

Company since

r

;

_




Joins Herman Rousseau
(Special to The financial

WORCESTER,
Pal.e has
man

Chronicle)

— Albert
staff of Her-

Mass.

joined' the

Rousseau> g Flagg Street,

With Jamieson Sc Co.
(Special to The Financial

Chronicle)

MINNEAPOLIS, Minn. —Bruce

E.

Petterson

has

become

con-

nected with Jamieson & Company,

First National Bank Building.

36

The Commercial and Financial Chronicle

(1800)

Continued from page

and
Responsibilities

Free World Progress

American

laws.
The worst
exercised with immu¬
budget, and to stop further mone¬ nity in our country is presently
that of labor unions. Besides, the
tizing of government debt.
Our country has already become labor unions do not hesitate to
have
recourse
to
intimidation,
a high cost and high living coun¬
violence, blackmail to obtain their
try which may well undermine
"■
progressively
our
competitive 'goals.

reduce

to

decide

we

labor

bad

of

govern¬

monopoly

expenditures, to balance the

ment

.

Thursday, October 30, 1958

.

organized labor: "If

our

free, com¬

ally conflicting trade policies. Our

is not

petitive institutions

,

5

are

to be pre¬
by the

recent enactment of quotas on the"

for

a

good and sound substitute

experience arid
imports of lead and zinc are a wisdom. But the best way for us
unholy combination of predatory good example of our inconsistent to help under-developed countries
gangsterism and crackpot social¬ actions.1 Yet we have made great is to liberalize international trade
ism that is thriving and expand¬ advances from the pre-war regime and to
prevent abnormal swings
ing under labor's Congressional of stagnation and trade warfare. I in our business cycles. The sound¬
benevolence, then business has no believe that the largest number of est and most effective way of
choice. It must do likewise (par¬ American businessment have fi¬
spreading well-being in the world
ticipate actively in politics), or nally accepted the idea that we can and the benefits of technological
throw in the towel."
export only if we import. Unfor¬ progress occurring in the indus¬
tunately it took many tragic years trialized countries is freedom of
Controlling Cyclical Amplitudes
to reach this point of view.
The international trade.
intelligence,

destruction

from

served

as

.

'

ability in international trade. Un¬
til now most of the countries in
inflated their

the free world have

the

about

to

systems

currency

degress as ours. However, I
believe that henceforth most of

same

compelled

these countries will be

Berates Business and Labor

of our big
businesses in this field is consid¬
erable.
They set the pattern for
the wages in the entire country.
responsibility

The

shameful to see at times big

It is

and

business

unions

labor

big

their monetary affairs
discipline for the fol¬ agreeing on increases in wages
followed immediately by increases
lowing reasons: To avoid balance
in prices.
This is a conspiracy:
of payment difficulties, and be¬
against the welfare of our nation.;
cause their peoples have become
The recent contracts between the
weary of inflation.
Should the
automobile
industry
and - theEuropean countries decide to stop
further monetizing of government United Auto Workers are hailed
as
non-inflationary, while imme¬
<lebt, our gold and currency are
bound to be put in jeopardy if we diately after the signing of the con¬
continue to mismanage our mone-»! tracts it was stated in Detroit that
to

manage

with greater

consumer prices on medium and
priced cars would increase ap¬
proximately:; $50 due to higher

lary affairs.

low

Inflation Means No Protection
It is

unworthy of

great

a

coun¬

costs.

annual automatic increases

The

try like ours, which has made such-

invaluable contributions to human, in wages and the cost of living
escalators are especially pernicious
progress and civilization, to be-*
have all of a sudden as if our peo¬ to the welfare of our society be¬

blind or castrated. The' cause they protect a large segment
Jack of will-power to reinstate the of our population against the con¬
dollar on a sound basis is a dis-; sequences of inflation. Farmers in
their
turn
are
also
protected
grace to our great nation. You and
ple

were

against the evils of inflation by
every day under the pen
responsible individuals that in¬ the parity formula. Those who are
flation
has become unavoidable, hurt in the process are the nation
and that we should protect the as a whole, and many segments of
I

read

of

value of

savings and the pur¬
chasing power of our income by
taking inflation as a fact of life.
our

"

The truth is that

playing
with fire.
The question is not
whether you and I can protect
©urselves against the consequences
of inflation.
There is no way of
protecting everyone against the
consequences of inflation for the
simple reason that inflation con¬
sists precisely of cheating some
people for the benefit of others.
The

truth

is

we

that

are

have

we

choose between inflation
dom.

We shall have

shall

rency or we

The distrust in

ment

bonds

has

to

free¬

sound

a

cur¬

being free

cease

men.

or

our

govern¬

attained

a

dis¬

quieting stage. Secretary of the
Treasury Anderson appealed the
other day to the patriotism of the
managers of

trusts, pension funds,

etc.

to buy bonds.
With all due
respect to him, because I like him,

I submit that this is not the

remedy for

right
predica¬

present

our

population, including old per¬
sons, and people who save and

our

increases

in

productivity, inflationarjr pressures will still be released,
since wage patterns will have been
set
for employees
in industries
where possible productivity
in¬
creases

creases are

smaller

or non-existent.

acute.

fairs in such

a manner

the

purchasing

government

manage

and

bonds

a

sound investment.

Let

a

sacred

duty of

Whether

ers

ours

to

how

human

shall

we

solve

second

successful operation of

ciety

is

forces.

the
A

free
free

a

social

consequences

departed from

funda¬

a

us.

the

1929 which consisted of

free

so¬

largest part of the benefit of in¬
in

creases

consumers,

economy

giving the

productivity to all the
while the smaller part

followed

by

able deterrent of economic prog¬
ress
and a great danger to our

which

breeding inflation and

wcial

a

went

of

by busi¬

and

economic

a

consider¬

system.




i

to

increases

in

wages

We have adopted

abnormal

are

We

have anti-monopoly laws against
business, but unions have a strangle-hold on our economy because

Bill

Martin,
in

men

are

increases

in

increased

detrimental to

our

a

and

policy

our

one of the most able
country, that the best

as

,.The Gulf Oil Corporation in
recent letter to its

a

employees and

shareholders had this to say about

S.

Summary

Act
by the
welcome sign

leadership
However,

forget how

never

Having outlined the four main

in

progress
to stress

the small minority represent¬
ing high tariff interests almost
succeeded in destroying our trade "
program.
Tariffs are a difficult
question for many businessmen to
take

bold

a

stand

of

group

the

free

fered

world

that

have

should

we

su¬

said

among

portant than that of a sound dol¬
Fundamentally the; issue of
sound currency is one of morality.
There was a time when the: big
lar.

of

the

western

world

giving the small countries an
example of good behavior. Unfor¬
tunately we can't say as much for

suf¬

the

policies of our governments
We have foregone dis¬
cipline in monetary matters, just;

prosperity.

V

in passing, I am not
certain amount of aid

a

countries

to

that

is more im¬

were

as

we

have become accustomed to

in tackling
problems. We need to;
deal with the issues confronting
us—not
piecemeal—but compre¬
the

in

use

of expediency

most of our

need, and some
assistance to speed economic de¬
perimposed a credit inflation right
velopment in the so-called under¬
on the heels of a money inflation
due to the monetizing of debt to developed countries. The process
of economic growth in an under¬
finance the war. While it is true
that the amplitude of the business developed country is a very com¬

cusable

none

almost unthinkable blow, nowadays.

an

to their unity and

Be it

have

more

once

these conditions

countries

on,
but if a
businessmen had

would

conditions for economic
in a free society, I wish

necessary

we

this

even

year

artificially over-stim¬
For instance, it is inex¬ opposed to

ulated.

hensively,; with all the earnestness
they deserve and require.
It is
late, but not too late. It is still
plex problem. It is very easy to my hope that our great, country
cycle depends a great deal on cir¬
cumstances and fiscal and mone¬ squander money in. useless and; and nation will live up to its re¬
uneconomic projects.
Dollar aid sponsibilities. r
' r-»
.
;
r
v ' '
tary policies of the government, it
true that the

is nonetheless

themselves

nessmen

can

busi¬

make

a

Continued

valuable contribution towards the

from

page

5

units,

"Ward's

operation of a steady economy. It
would be for the best of

our coun¬

try if at times we showed restraint.

instance, I for one can find
for
a ; policy
which
makes
it
necessary
to produce
For

excuse

no

and

seven

biles

one

a

half million automo¬

year,

producing

commodities. The

raw

American

recent

recession

has

strongly affected those countries.
It has created unsolvable prob¬

lems, and

always, demands fo"

as

America, leaving aside
the ill-will towards our country. I
aid

from

simply to say that the mis¬

mean

management of our economic af¬
fairs has considerable impact on
the

of

rest

the

world

cannot disregard.

which

we

that
of our good international relations
that we manage our economic and
monetary

affairs

the

with

powerful

monopolistic
in

country.

Now,
in

the
a

society is that

free

liberalize

can

trade

we

between

the

increase

at

peak.

time when public interest in autos is at its

a

This trade weekly observed that

only limited activity,

seeing

would

week

total

an

with General Motors plants

United States production the past
69,599

estimated

cars

contrasted to 45,387

and 104,987 in the corresponding week
year ago. With General Motors at full strength, output would be
well over the 100,000 mark, "Ward's" added.
However, boosting schedules during the week were Ford
Motor Co., Chrysler Corp., Studebaker-Packard and American
Motors.
Most of Ford's plants functioned on Saturday, as did
American Motors, Detroit Dodge, Plymouth in Evansville, Ind. and
the

in

preceding

week

a

Plymouth-Dodge in Newark, Del.
;
;
"Ward's" estimated truck output the past week at 16,288 units
.

against
last

in

14,209 last week and 21,543 in the corresponding week
In addition to Chevrolet's closedowns* Mack plants
Jersey, Pennsylvania and New York were idle.
Mack

year.

New

bargaining for

and the United Auto Workers are

a new

contract.

Although building permit values in September fell moderately
prior month, they exceeded those of a year ago for the
ninth consecutive month, Dun & Bradstreet, Inc., states. At $585,from the

381,293, the total for 217 cities, including New York, was the
highest for any September on record. This represented a decline
of 7.9% from the revised $635,323,289 of August, but was up
11.6%

over

the $524,374,748 of September, 1957.

City fell sharply in September.

Permits issued in New York

They were valued at $53,445,172, a drop of 48.6%

from the $103,-

987,432 of August, but up 19.6% over the $44,690,851 of September
year ago.

a

,

Steel Output Scheduled to Dip tp

74.4% of Ingot

Capacity This Week
Mills will produce more

week

comparable

Steelmaking
continue

will

a

steel this week than they did in the
"Steel" magazine predicted on

ago,

year

to

operations,

double

pacing

for

increase

automakers build up steel

at

a

least

rapid
the

industrial

next

few

upturn,

weeks

as

inventories to take care of needs caused

shift operations

of

the

standard

of

policy the consumer is practically
always the forgotten man.
Postwar Trade Record

We can,

not necessarily

and

however, be reasonably

of our postwar record in
Congressional policy.
The free
world is still seriously divided by
trade barriers, and we still often
pursue independent and occasion¬

bigger

overtime work.

As automotive
orders, but

ones.

The metalworking weekly

and for

It is most regrettable that
discussions on foreign
trade

proud

enthusiastic burst of production in Novem¬
December and possibly January, accompanied by almost
industry-wide overtime operations. Increased schedules are dic¬
tated by the current dearth of 1959 models in dealer showrooms
"Ward's" predicted an

ber and

international trade

living.
in

parts will hold output of automobiles for October to the 250,000
300,000-unit area, reported the statistical publication. However,

to

output increases, steelmakers will probably get more
be stressed enough

economic progress

for

Reports," stated on
.

by
never

how: important

is

Automotive

Monday last.

fourth condition for
of economic prog¬

nations.

It

488,000

of

restraint

labor unions we have at present
our

goal

Friday last.
^
..
„
.
.
Month-long labor difficulties arid-subsequent shortages of key

It is to the in¬

terest of our own country and

prices,

country

should

boom

a

wages,

whole.

U.

this critical matter.

large

to prevent a slump is to pre¬

way

vent

mental

policy of
our
industry
adopted by our country before

continued

of

a

not
fought
vigorously for the
entirely agree with the Chair¬
of the Federal Reserve Board, trade bill this year our nation and

I

should

We have

the

Agreements

man

very

ness

are

controlled.

be

can

ress

marketing policies will be
far-reaching for our society.

profits.

by labor,

cycles, but I feel confident enough
to assert that the amplitudes of
the ups and downs of the cycle

of such

and competition are the secret of
economic progress and
prosperity
for all. Monopolies, either
or

enterprise system. I will not
the causes of business

into

go

the furthering

play of market
market

free

nomic

for

condition

inherent to the operation of a

are

with

and

extension of the

U. S. Congress was

by the
sheer force of
necessity into more and more selfservice, which is based on preselling by advertising. The eco¬

freedom

monetary problems confronting
The

tech¬

system

enterprise system sur¬
vive depends to a
very large ex¬
on

enjoying

recent four year

Trade

how to reduce its cost of distribution.' and wisdom. It can be done, but
It may well push our distribution not with bad government and not

and the free

tent

industries

in

tough problem of

put the dollar on a sound basis
because the international
currency
system of the free world has come
to depend on the soundness of the
dollar.

The increases in wages to work¬

holding of nological progress creates for the
good and retail field the

repeat again that it has

me

become

its af¬

to make

as

eco¬

coutptries with which we trade,
fully consonant with in¬ anff^particularly for the countries

The

is to

for

society
should prevent abnor¬
mal or exaggerated swings of the
business cycle. I belong to those
who believe that business cycles

in such industries receive wage

ers

monies

government

condition

third

we

and four million
like government bonds. Unfortu¬ the next year. Neither is it wise
to over-stimulate the appetite of
nately those who are hurt instantly
the consumers by low down pay¬
by the consequences of inflation
ments and too easy credit terms
have not enough political power.
The idea that there must be an over a long time period. I am not
principle against
instalment
annual increase in wages com¬ in
provided they are made
mensurate with the national aver¬ sales,
with moderation in good times,
age increase in productivity is bad
economics and dangerous in the and provided we increase our ef¬
forts for instalment sales in times
extreme.
It should particularly
concern people interested in
the of recession.
distribution of goods for the fol¬
Dangerous Swings Affect the
lowing reasons:
World
Only highly mechanized indus¬
Too large swings of the business
tries benefit from dramatic in¬
creases in productivity.
If work¬ cycle are also dangerous for the
investments

interest

fixed

make

As you know, for the first time,
duty of the trustees of
this year witnessed a majority of
belonging to others is to the nation's workers
employed in
manage them as well as they pos¬
service industries; therefore the
sibly know how, to preserve their
problem has become even more
purchasing power. The duty of the
ment.

The

nomic progress in the free

if that

are

stated that steelmaking operations

expected to reach a peak of 85% of capacity during the

fourth

quarter.
Last
for

the

week

s

week, steel was produced at 75% of
year.

level.

Operations advanced
Production

was

about

1

capacity, a new high

point above the previous
2,024,000

net tons

of steel.

During the corresponding week last year, output was 2,052,000
tons.
Rates were up in six out of 12 steelmaking districts as
follows: St. Louis at 96%, down 2.5 points; Chicago at 85, up 0.5
point; Cincinnati at 83, up 3.5 points; Wheeling at 83, up 1 point;
Detroit at 82, no change; Cleveland at 80, up 0.5 point; Buffalo at
78, no change; Western district at 75, no change; Eastern district
at 71, up 1 point; Pittsburgh at 69.5, up 2.5 points; Youngstown
at 64, no change, and Birmingham at 63.5, down 2.5 points.

Volume

Number 5790

188

Steel

consumers

are

.

Moving higher in wholesale cost the past week were oats,
hams, bellies, cheese, sugar, milk, tea, cocoa and hogs.
On the down side were flour, corn, rye, butter, cottonseed oil,
'eggs and steers.'';/•
"
.
%

starting to look ahead as mills extend

into the market for bigger tonnages.

'

this

year

producers cash in on low costs.
A broader range of products is being imported into a wider

ordinated

fence

The

important imports in 1957 were: Reinforcing
bars, 340,0u0 tons; pipe and tubing, 150,000; round and flat wire, 5.
140,000 and structural shapes, 80,000 tons. .
:
.i
:
"Steel's" composite on prime grades of steelmaking scrap held
unchanged last week at $42.33 a gross ton for the third straight}
week. Dealers are banking on higher steel operations to stimulate
.

soon.

The

*

,

/•-

..

American

'*■/.'
and

Iron

.

Steel Institute

rate of steel companies will

operating

■

.

-7,7:-"-\Y'

;

announced that the

average

-125.1% of steel

.

week beginning Oct. 27, 1958. equivalent to
2,009,000!' tons of ingot and steel castings (based ori averaged
weekly production fcur 1947-49) as compared with an actual rate

capacity

the

beginning Oct. 27, 1958 is equal to about
74.4% of the; utilizatiori' of the Jan. 1, 1958 annual capacity of149,742,570 net: tons compared with actual production of 75.1%
V:r Output for the week

the week before.

general

commodity price

level

last year.

'

:

•;

.

a

moderate

decline

in

flour

the actual weekly production '
placed at 2,041,000rtons, or 127.1 %.
; . • *
* \ -

^Index. of production

is based

on average

were

77.

weekly production for 1947-1949.

..

.

The amount of electric energy

'

and

distributed by the electric light

industry for the week ended Saturday, Oct. 25, 1958
estimated at 12,174,000,000 kwh., according to the- Edison

power

was

Electric
For

Institute;
week

the

Output increased
ended

Oct. 25,

moderately the past week.

1958 output increased by 126,-

000,000 kwh. above that of the previous week and was
kwh. above that of the comparable,.1957 week and
kwh. above that ;£f

Ih^y^ek ended Oct. 27^.1956^ ^/

Car Loadings Rose

337,000,000
783,000,000

,

Slightly in the Week Ended Oct. 18

1

9,630

cars, or

corresponding week in 1956.

Cotton

-

Improved Further Last Week but
Makers Will Fall Far Short of October's Goal

production for the week ended Oct. 24, 1958,
according to "Ward's Automotive Reports," showed further im¬
provement, but car makers will fall far short of their October
goal of 488,000 units. Labor difficulties and subsequent shortages
of key parts will hold output of cars for October to the 250,000
to 300,000-unit area, it added.
Last week's car output totaled 69,599 units and compared
with 45,387 (revised)
in the previous week. The past week's
production total of cars and trucks amounted to 85,887 units, or
an
increase of 26,291 units above that of the previous week's
Passenger

car

output, states "Ward's."
Last week's car output rose above that of the previous week
by 24,212 units, while truck output increased by 2,079 vehicles
during the week. In the corresponding week last year 104,987
cars and 21,543 trucks were assembled.
Last week the agency reported there were 16,288 trucks made
in the United States. This compared with 14,209 in the previous
week and

21,543 a year ago.

Lumber

\ Lumber shipments of 467 reporting mills in the week ended
Oct. 18K 1958 were 0.9% below production, according to the "Na¬
tional Lumber Trade Barometer." In the same period new orders

Unfilled orders amounted to 37%
of stocks.
Production was 7.2% above; shipments 5.4% above
and new orders were 1.4% above the previous week and 6.7%
were

prices on the New York Cotton Exchange moved
reflecting reports of favorable weather conditions
Belt.
Consumption of cotton by domestic mills

September amounted to about 648,000 bales, somewhat
than anticipated. Exports during the week ended last
Tuesday were estimated at 50,000 bales, compared with 64,000
in the prior week and 117,000 in the comparable period last year.
For the current season through Oct. 14, exports came to 660,000
bales as against 388,000 during the same time last season.
during
higher

in 1957.

Business Failures Declined

Volume in Latest Week Recorded

Trade

Below the Like Period in 1957

industrial failures declined slightly to 275
in the week ended Oct. 23 from 288 in the preceding week, Dun
Commercial and

Casualties dipped lower than in the
comparable week of last year when 281 occurred but they re¬
mained above the 267 in 1956. For the first time in six weeks,
failures fell below their prewar level; the total was down 8%
&

Over

Bradstreet, Inc., reports.

from the 300 recorded in

1939.

involving liabilities of $5,000 or more dipped to
233 last week and 239 a year ago. A mild decline also

Casualties
226 from

occurred among small

failures, those with liabilities under $5,000,
in the previous week but remained

which were off to 49 from 55

slightly above the 42 of this size last year. Nineteen of the week's
casualties had liabilities in excess of $100,000 as against 17 in the

preceding week.
Wholesale Food Price Index Moved

Fractionally

Higher the Past Week
consecutive weeks of declines, the Dun &
moved up fractionally last
the 1958 low of a week earlier. On Oct 21 it stood at

Following three

Bradstreet wholesale food price index
week from

$6.25, up 0.3% from the $6.23 of the prior week
than the $6.14 of a year ago.
.
.
-




and 1.8% higher

of

post

Force

the

United

States

/*"'■;' ,c'' 7' >7

:

Base

Material Com¬

■

•

clutches, electro - mechanical and
hydraulic units of various types,
cargo and rescue winches, and in
the manufacture of

precision

com¬

ponents find industrial gas burners.

Similar Period

a

a

addition, a division of the com¬
in the overhaul and
repair of airborne and electronic

Slight Gain

pany engages

Year Ago

instruments.

from

Although consumer buying faltered somewhat last week

the purpose

of new tools, dies and
special fixtures for the manufac¬
of new products and to in¬
crease production of present prod¬

gains in women's apparel and furniture offset de¬
men's apparel. Spot checks indicated that
new
passenger cars moved up again, but remained

in

below

year ago.

a

*$'

.

of retail

ended

condition portions

higher than a

veal.

by the following percentages: Middle Atlantic States +2 to
East North Central +1 to +5%; West North Central, East

air

and

of the plant in

order to facilitate the maintenance

spot estimates collected by Dun & Bradstreet, Inc., re¬
Regional estimates varied from the comparable 1957 levels

of

necessary precision tolerances
required by the aircraft industry;
and to increase working capital.

ago,

year

modernize

to

ucts;
trade in the period

Wednesday of last week was unchanged to 4%

on

ture

'

,

dollar volume

total

The

the sale

of the above issue will be used for

year-to-year
volume

net proceeds from

The

prior period, which included Columbus Day, total retail vol¬
ume was up slightly from the comparable period last year.
Some
the

+6%;
South

South Atlantic, Moun¬
tain and Pacific Coast—-1 to -j-3% and New England States —2

Central and West South Central 0 to -f 4%;
to

-j-2%.

Forest Laboratories

.

Buyers

stepped

their

up

purchases

of men's Winter

suits,

Stock $2,50 a Share

sportswear and furnishings the past week, boosting over-all men's
apparel moderately over a year ago. Reflecting the high level of
retail activity, volume in women's coats, dresses and sportswear

Greenfield

York,

up

substantially.

stock

fashion accessories matched that

at

.

buying of food

and

new

,

produce and frozen foods were somewhat better during
The call for poultry, meat and dairy products continued

proceeds from the fi¬

other corporate purposes.

Giving effect to the sale of the

stock, there will be outstand¬

shares

326,000

ing

out

ah

of

authorized.issue of 500,000 shares.

level of earlier weeks. There were some outstanding in¬
creases in the call for canned fish and fruit. Vegetables and interest

to

net

products and for working capital

products at wholesale remained at the

the week.

of Forest
$2.50 per

cents)
Inc. at

nancing will be used to pay out¬
standing notes, .to expand sales
force_ and .promote
company's

high

close

10

(par

The

lagged in Boston.

The

Co.,

share.

appreciable rise in trading in
industrial fabrics and man-made fibers during the week.
The
volume exceeded that of last year.
Increased transactions in
sateens and broadcloths offset slight
declines in print cloths
holding volume in cotton gray goods at the level of a week earlier.
While interest in woolens and worsteds picked up in Philadelphia,
sales

Inc., New
offering an
150,000 shares of capital

Laboratories,

high level.

a

&

publicly

are

of

issue

Demand for women's suits and most
of a week earlier. In preparation
for Christmas, retailers increased their buying of women's blouses
and sweaters.
Interest in children's merchandise was sustained
moved

in fresh

Mildly the Past Week and

Air

Air

an

In

17JB% below production.

below the like week

of acquiring

is engaged in the
business of engineering, designing
and; manufacturing
aircraft and
missile accessories, including line¬
ar and rotary actuating units and
systems, h o i s ts, gear boxes,

Textile mills reported another

Shipments Fell 0.9% Below Output of the
Week Ended Oct. 18, 1958

Haydu Products,

purpose

The company

Cotton

the

is

mand

down last week,

in

the

Air Force.

!

1

:

;

.

Olmstead

which

clines in appliances and

Automotive Output
Car

the

buyers appreciably stepped up their purchases,
prices remained close to those of the previous week. Cocoa

expanded.

-

•

production: facilities at Middletown, Pa.j in close proximity to

prices moved up slightly at the end, of the week as transactions

1.4% above the preceding week.

Loadings for the week ended Oct. 18, 1958 totaled 695,768
cars, a decrease of 31,044 cars, or 4.3% below the corresponding
1957 week, and a decrease of 132,973 cars, or 16% below the

the

a

Loadings of revenue freight in the week ended Oct. 18, 1958
were

during

noticeable dip in prices. -The buying of rice was sus¬

Although

coffee

Showed Moderate Improvement
In the Latest Week 7,

Electric Output

trading

a

Jersey, a subsidiary of the Bur¬
roughs Corp. In August 1956 the
company's name was changed to
Haydu Electronic Products, Inc.
The company's executive offices,
engineering. and principal manu¬
facturing facilities are located at
1426 West Front Street, Plainfield,
N. J, The company also maintains

high level with prices unchanged. Purchases of sugar
steady holding prices even with-those of the prior week,

tained at

at

the principal assets of a business
known as Haydu Brothers of New

harvested a record crop, soybean trading slack¬
prices dipped moderately.' Purchases of rye declined
appreciably and prices turned moderately lower. Steady trading
in rye held prices close to those of the preceding week.
'
was

com¬

share through Dec.

per

under the name

Inc. for

farmers

a

of

company

The company was incorporate^
in New Jersey on June 26, 1956

'

and

ened

the

of

30, 1968.

the comparable date

shares

into

stock

price of $5

helped
grain prices during the week. The corn crop was esti¬
mated to be 2% above the record of 1948 and prices dipped sharply. 7
Corn trading was close to that of the prior week. Although com¬
mercial buying of wheat moved up at the beginning of the week,
transactions lagged at the end of the period, accompanied by a
weakenings in - prices. Export demand for wheat is expected to
climb substantially in the coming weeks.
7 /
< ;

week and

duction 1,901,000 tons. :A year ago,
was

convertible
mon

Record harvests and reports of favorable crop weather

There

the rate was * 118.3% and pro¬

ago

in

lower most

•

month

For the like week a

noticeably

/ 7'

'

u

Registered

declined

earlier and compared with 278.25. on

week

As

*126.1% of capacity, arid 2,026,000 tons a week ago.

of
■:

for

York, N. Y;, are offering
of 6% convertible sub¬
debentures
of
Haydu
Electronic Products, Inc. at par
($100 per debenture).
The
debentures
dated
Oct.
1,
3 958 and due Dec. 31, 1968, are

stock, grains, steel scrap, flour and lard.
The daily wholesale
commodity price index fell to 276.71 on Oct. 22 from 278.00 a

.

•

-buying

Berry & Co. of Plainfield, N. J.f
and New

the latest week, with the most significant decreases in some live¬

Tonnagewise,

.

per

Noticeable Declines in Latest Week

v

.

total

Wholesale Commodity Price Index

;

staples and 13% of woven wire

shipped in last year.

were

sum

..."

country. More than half of the supply of barbed
wire in the United States came from abroad last year. Nearly a
quarter of the supply of nails and

Debentures Offered
$300,000

of the

section

of the price

level.

is 1,235,000 net tons against 1,153,702 tons in 1957.
The outlook is for shipments to be up still more in 1959 as foreign
for

represents the

pound
of 31 raw foodstuffs and meats in general use and its chief func¬
tion is to show the general trend of food prices at the wholesale

rising the magazine noted. "Steel's" estimate

Steel imports are

•

index

The

'

37

Haydn Electronic

barley,

Cold-rolled steel buyers are giving suppliers
45 days' notice of requirements instead of 30.
They know that
steel is going to get tighter as automakers, appliance manufac¬

.delivery promises.

turers and other users come

(1801)

The Commercial and Financial Chronicle

.

.

Forest Laboratories, Inc., incor¬

porated in Delaware on April
.

11,

1956, is engaged primarily in the
of developing, manufac¬

business

that of the prior week.

and selling various drug
pharmaceutical products. It

turing

Department store sales on a country-wide basis as taken from
the Federal Reserve Board's index for the week ended Oct., 18,
1958 advanced 6% above the like period last year. In the preced¬
ing week, Oct. 11, 1958 an increase of 4% was reported. For
four weeks ended Oct 18, 1958, a gain of 3% was registered.

period Jan. 1, 1958 to Oct. 18, 1958 no
from that of the 1957 period.
the

the
For

change was recorded
,

York City a week ago,
according to estimates by trade observers, would show an increase
Retail

trade

sales

volume

in

New

8% above the like period of 1957.
week were noted in women's apparel as well
as
shoes and accessories.
Men's wear and domestic goods and
housewares also showed strength during the week.

and
also

and

imports cosmetic compounds
preparations from a foreign
for
sale
in
this

manufacturer

country.

.

.

company's principal office
and plant is located at 838 Ster¬
ling Place, Brooklyn, N. Y. It also
'maintains a sales office at 527
The

Madison Avenue,

New York, N. Y.

of 4 to

Increases for the

According to the Federal Reserve Board's index, department
sales in New York City for the week ended Oct. 18, 1958
showed an increase of 14% from that of the like period last year.
store

John Muir to Admit
On Nov. 7

Richard D. Foer will

acquire a membership in the
York Stock Exchange

New

and will be

to partnership

in John

In the

admitted

ported.

Muir

&

York

City, members of the New

York

Stock Exchange.

preceding week, Oct. 11, 1958 an increase of 5% was re¬
For the four weeks ended Oct. 18, 1958, an increase of
8% was noted. For the period Jan. 1, 1958 to Oct. 18, 1958 an inCv~-*
"
was
registered above that of the corresponding

period in 1957.

/

Co., 39

Broadway, New

38

The Commercial and Financial Chronicle

(1802)

Manhattan Bond

Madison Fund's

Fund to Be

Rights Offering

-

.

.

Thursday, October 30, 1958

.

Fundamental

:

Absorbs Private Fd.

-

Assets .of
"

^Absorbed

by

By ROBERT R. RICH

hattan Bond Fund, Inc.

announced

reorganiza¬
tion, recently submitted to share¬
holders, received a tremendous
vote of approval at shareholders'
that the fund's plan of

meeting;
The

||

-j—<i

of directors of Man¬

if"ii

the

involving

•.

S^ertoS,' i^^^ttaue

^
fo favor the diversified
Business Kecovery Stock program
."
-*«J
in
the
most
recent

common

,

.

.

,

Cited

by E. Rubin

pur¬ sets of

company "'are

acquired by

1,286,619 addi-

being

one

Stockholders was subscribed for damental Investors, Inc., a $470
Uhder * primary rights, with the nnlhon mutual fund.
;
balance "substantially oversubAccording to a joint announceserlbed" through oversubscription ment by Hugh W. Long; President
,

r

Irte^:

Selected American added 16Und

Shares,

American

Selected

Quarter

_

__

total

mutual fund, reports

plan,

believes that these

over-oriced

i

f

Full-Fledged

$12 million private

a

investment

of the' nation's
tional shares ottered Madison Fund largest common stock funds, Fun—
Over 91 % of the

"Diversified
The board

ci otu/9t/i isjC/it

▼

Sept

$80jp75,3S8

... Ro k I r a ;i(3«eia
DL- increase of 33.9% on
over assets ot r
Inc., $59,805,980 at Dec. 31, 1957. Outstanding shares at Sept. 30 of
k
shares of the latter fund, was ap¬
8,748,095 compare with 8,001,847
proved by holders of more than at Dec
85% of the outstanding shares 26 cents
"Such a large vote," according to
gains in January, net asset value Met „.
•An application/ toil exemption
ReDr;bIic
Steel;
Wm. Gage Brady, Jr., Chairman
iwwwh Scarle; and Stauffer Chemical. In"owneA
of both funds, "is exceedingly rare with
f
iQ57^^With St^arte;
Stauffer^Ghemibal;fr®mi
(<*).
$7.47 at Dec. 31, 1957. With
number of owners
vv11"1 J!'*'*1; Dec' ? ' 1? '
t
+i~
bus
in any kind of corporate ballot¬ adjustment -tor reinvestment of creases in prior stock holdihgs ;
Annnnnrfa- RpnHfv
'•
but in the mam,
been filed with the Securities'and
ing."
this capital gain distribution, the
chase of the fund's assets by

Investment

versified

Fund,

balanced fund in exchange for

a

.

^S

^tiortii22

L

®-feveitfr

m

The

had

reasons

letter
Mr.

to

for

exchange

the

expired in

been

special

a

in

^viati^Co^ahi^CoS^^eSe-

the

Stocks

shareholders, signed by

irtfoTio

and Hugh W. Long,
President. They included: the loss
of the purchasing power of bond
income as a result of inflation;
five largest industry holdings in
the fact that dividends from a
common stocks were steel
11.7%,
bond fund do not qualify for the
oil
11.2%, electric utility 7.4%,
usual dividend exclusions or divi¬ electrical
&
electronics
6.8%,
dends received credit under the
metal (non-ferrous) 6.4%.
Federal tax laws. Reflecting these
Edward P. Rubin, President, refactors which are beyond the con¬
trol of the fund's management, ports to shareholders: "The nu¬
merous
encouraging economic
there had been a declining trend
straws'
we
reported to you 111
in the number of Manhattan Bond
midsummer appear now to have
Fund's shareholders and its total
turned into
fullfledged business
assets, which threatened econom¬
ical administration of the fund in recovery. As it became evident
the third postwar recession might
the future.
prove as short and mild as its two
Manhattan Bond Fund share¬
predecessors, common stock prices
holders will
be
informed next
worked upward.
High grade
week as to how to exchange their
bond prices fell
due in part,
share certificates for certificates
perhaps, to more general recogni¬
of Diversified Investment Fund,
tion of inflationary risks. More¬
Ihc. The net asset value of the
over, as business began to recover,
Brady

.

.

.

shares of both funds at the close
of

business

Oct.

on

will

23

be

the basis for the exchange.

Values

$8.98

were

ly

resumed

Diversified Investment Fund and
per share
for Manhattan
Bond Fund; Cash will be paid in

$0.42;

lieu of fractional shares.

to

policies

tional

J

tendencies. «These

fight

inflation

sound

dollar

svmnathize

Dresser;

General

made

Oil.

Reductions

.wi/4i+iAnoi

ex-

t.hocf*

price advances

raxcn.dnge

choree' wrii

holdings of American
Central Illinois Publie Service; Commonwealth Edi¬
son;
National Dairy; Socony

Mobil; and Standard Oil

vestment and corporate purposes.
On the new basis of 6,433,093
.

(N. J.).

,

$19.40

share

per

yommission,, xne yrans-

>

of

as

Sept.

R

in

effective

time,

Investors

r„mm„v

_

be

that

f*?™/

30,

-

share-

and!

wi11

h„

the
Hi„

wlU be dls-

;

■

.

'

•

.

an-

Investors Management Company,

difficulty investing the
funds profitably," Mr. Merkic

Inc., one of the oldest investment
supervisory organizations in ; the
mutual fund field, whose business
was established in 1924/

general securities market we

ticipate
new

no

''There

said.

are

situations

valued

always
with

under¬

unrecog¬

potential, even in the most

advanced

bull

Tri-Gontineiital

markets."

T. Rowe Price Sb.

Reports 21% Gain

Value Gains 24%

Of Bullock's Two
Canadian Funds

In Net Asset Value

Growth

Stock

Investment assets of Tri-Con»ti-

Fund, Inc. reported that total .asgets
increased to $14,121,737 on

nental Corporation, the nation's
largest diversified closed-end in-

T.

Graham F. Towers, C.M.G., has
elected Chairman of the

been

tn

Fundamental

„

will

At

The investments of Fundamental
"Despite the high level of the Investors, Inc. are supervised by

1958.

nized

Towers Chairman

,

,

,

shares, net asset value of Madison
Fund
stock
was
approximately

were

in

Natural Gas;

Price

Rowe

Board of Directors of Cafiadian Sept. 30, 1958 from $9,436,114 on vestment company, increased to a
Fund, Inc. and Canadian Invest- Dee: 31, 1957. During the first nine " record $361,870,390 at Sept. 30, it
,

impor-

Who

Combined assets of the two funds period 893 new stockholders subscribed to Fund shares. , ,.
Mir. Towers is President of Brit- -; In hisreport*/Mr; Price noted
ish Petroleum (Canada) ;Ltd., and the business recovery which has
is a director of General Motors takeir place-sihe^ April of 1958.
Corporation. He headed the Bank '-Since then, industrial production
of Canada for.the first 20'yedrs a? measured by: the-Federal.Reexceed $150,000,000.

are

skentical of avoiding still further

(Special to The financial Chronicle)

offering:

deducting

ndnoae-'ita.

preserve

highly

with

Bank;

continent

of^he past^ years ^r ^T^n^can

Form CHek Inv. Co.

Invest—:

Stores; Minnesota Mining; Ohio
Edison; Republic Natural Gas;
Royal Dutch; and Sunray-Mid-

de¬

attempts

and

are

theAfter

om

Foods; General Public Utilities;
Lily Tulip Cup; May Department

infin+innnrv

+

a
-

fr

Associates

.

credit

dele

eliminated.
wer-ft

assets

the Federal Reserve Board quick¬

These
signed
share fop

per

Cbmiiiiss

November.

.

.

accomplished its purpose/

^GeSeSIScW^" P- °f jfSS'

26.9%

value per share rose
nine months.

asset

With

many

PKfSACOLA, Fla. — Click In¬ stock prices at new hiehs and
some obvestment Cov, Inc. has been formed earnings lower
with offices at 1206 North Palafox servers say stock prices are 'high'

.

of $20,313,439 in "the three months
ended- and was $58,466,254
greater than the $303,413,142 re¬
ported at the" start of • the year,
"Appreciatfon in "the market value
just

of investment "holdings was- the
primary factor iri the sharp rise

® • of its existence.
V
serve Board Index has recovered in investment' assets/* according
from
126 to 137, or more than to Mr. Randolph. New: funds
yeHe succeed? the Hon. Charles A.
probability
half
of
the
decline which had suiting from the exercise of warthat earnings of large, well-man- Dunning, P.C., Who died recently.
taken
place from;' the previous,.rants declined to a nominal $128,With Norm & Hirshberg
aged American corporations in the
Jrigh of 147/ The sharp recovery 880 in the third quarter. There
past
10 years
With J. I. Ferretl Inv.
or
(Special to The Financial Chronicle)1
longer have
to date, He said, has resulted from were 6,85.7,549 shares of Tri-COntended to improve in quality.
(Special to The Financial Chronicxe)
ATLANTA, Ga.~James T. Sisk,
strong consumer demand, cessa- tinental common stock Outstanding
GRAND JUNCTION—Harry B. tion of inventory liquidation, in- at Sept. 30: the remaining warJr., is now with Norris & Hirsh- Judged on 5 or 10 year average
berg; Inc., C. & S. National Bank earnings, or on strength of longterm Paming^ tmnd .fhi«
Ferrell has joined the staff-of
hi manufacturer's hew- rants were reduced to 1458,298
term earnings trend, this
manageBuilding, members of the Midwest
i?ont.AiT TnxVAc+tnonfc
itoa- orders, higher government spendAssets pel- common share stood
ment
is
convinced
such reprerepre- Jane I. Ferrell Investments, 1129
Stock Exchange.
ing ahd' especially a Sharp in- at $44.22 at Sept.30, upfrom.$41.30

Street

tcr

engage

in a

securities

business.

c,

,.

...

Studies this management has

conducted point to the

.

.

.

cVease

,

sentative

stocks

are

not

now

Colorado Avenue.

building and pub- three months; earlier and $36.42. at
The outlook for the start of the year. The gain for
the fourth quarter appears' bright the first nine fhonths of 1958 was
With regard to the automobile in- about 21%.
Assets per comiAbn
dustry which has been the chief share, assuming the exercise of all
drag on recovery, however, if s warrants, rose to $39.55 at Sept" 30
still too soon to tell'how well the from $37:12 at June 30 and $32.82
crease

Lathrop, Herrick & Smith
WTCHITA,
name
,

of

Clinger,
has'

Kans.

Lathrop^
Inc.,

—

been

The firm

Herrick

Beacon

changed to
Herrick & Smith, Inc.

in home

lie .construction.

&

Get the facts

Building,

on

Lathrop,

public

will

accept

the

1959

The -prevailing confidence that
business wilt recover to new highs
in

litfGretlttf

industry.

*

Brgfdd tv send you a free
prospectus describing Atomrc
Development Mutual Fund, Inc. This

mation, conceniing the Franklin Custodian Funds.

growth iir principal and income:

.

-

,

'

'

SocuriliaL Celine. Dopf C

.

•

■

infor-

t
i

f
-




ue,

t
cmf.

jdm

sn&L.

over

18

times

that while this increase

reflected

earning s—the gain in the market- value of

com-

stock investments* it also resuited from purchases of coramo
stocks on balance* using proceed
from the sale of fixed-ineom
securities. He added Biat third

mon

favored- equities,

o

Under the circumstances* prices

companies whieh seemed Ekely t
seem to
be discounting an opti- participate in cyclical- beeiness, re
mistic projection .of .earnings sey-_covery and that consideration 51s
eral "years hence.- Consequently, was giverfcfo common stocks whic
we consider it prudent to continue- seemed tec be reasonably priced i
the. conservative in v- es.tm en t relation fq long-term prospects,

i
rhwii «tar# n> w.

now

1958

investments

i

Please send me, without obligation, the Prospectus and other

NAME

of

Quarter changes in common stoc

FRANKLIN CVSTOMAN FUNDS, INC.
•4 Writ StTMt Nnr York 9, M. T.

of companies active in the atomic
fleWwith the ohjectfve-oIposaWe

.common

xxp 82.8%

added.

VfewHf

fMHosmoiethaii 75 hoidingsof
stacks selected from among those

made

bighest price/earnings^ ratio since
1929. They are selling at 14 to 10
times previous peak earnings-The
popularity of growth, stocks has
forced prices of many favorite issues
to
excessive - heights,
he

/

.

are

estimated

seeking;

possible growth and income through investment in Amer¬
ican

stockholdings

1959,

indices

Find out now about this series1 of Mutual Funds

terly report reveals that

and the inflationary- investment assets at the end of th
minded public have forced com- first nine- months as- compared
morr stock averages to a new allwith 75.1% at the beginning of the
time high. Representative stock year. Mr. Randolph brought pu

FUNDS

ATOMIC

at Dec. 31, 1957.
Tri-Continental's Sept. 30 quar-

models.

policy of keeping a. substantial /• New: common stock holding
portion of the ^ portfolio, in higher added iii the tltfrd quarter wer
yirfding ^ bonds and othet dbHar •shares of PfeabOc^jr CoafCd^Texa
obtigatibris." v
I^aiSlHc CoaT
Oft.:Cb^'Geifera
,

F;
?'

Volume

188

Number

5790

.

.

.

The Commercial and Financial Chronicle
39

^(1803)
y{
/Motors

Corp.; Lockheed

Aircraft

Gbrp; / Westinghoiise
Corp.;

E lectr i c
City Steel Co.;

Granite

Allied Chemical Corp. and Dresser.

Warns

FIFCoiifideiil oil f. /
Against
Inflation
Theory in Drug Industry

Our

Industries, Inc.
:r ^
The Twenty-third Annual Re¬
Investment positions were elim¬
port of Financial Industrial Fund,
inated by the sale of shares of
A review of general economic Inc., shows that on
Aug. 31, 1958,
Aluminium, Ltd.; United States
and
market
conditions
through FIF assets exceeded $101 million.
Rubber Co ; Chemical Corn Ex-'/

The

monetary authorities continued to keep the pressure on
supply of credit when they authorized tb^
Banks to increase the discount
rate last week
from 2% to 2%%. This move to
bring the discount rate ip line
interest notes and the

This one-year increase of more
than $26 million alone exceeds
the
total assets reported by FIF

Manhattan. thc^third/quarter of 1958 is given
inUhe'/Values iii Industries" study;

Bank; Chase

Bank/ First National City Bank;
of- Distributors Group, Inc.,
na¬
Hanover
Bank; B. F. Goodrich
four years ago.
Co. /and Columbus &/ Southern tional/ sponsor of the 21 mutual
funds,, comprising Group Secufi- : in commenting
Ohio Electric Co,
Principal de-1

Federal

only

Co: and National Fuel GaS Co?

U. S. and

exists in
securities markets,
according to
the report.
The rise of market;
"averages" conceals "hundreds of/
good quality stocks, especially in

Foreign

Share Values to

on

(eight
there

times
are

as

now,

people

many

in

our

as

net asset value on

1958 of

-

average

state),.•
! " •
/'/ // "./•
/: During the recent quarter, FIF
(with
60,000
shareholders)
ex¬
pressed its confidence in the long-

:$36.66 per"Share-on the outstand¬
ing .! 3,310,815 shares of/ common
stock.
'•/ This

//

•,

//"

t

value

on
Dec. 31, 1957 of $103,-'
456,893, equal to $31.25 per share
and net asset value of $115,410,679
or
$34.86 per share on Sept. 30,

oc ca s

against* • over-optimism.

total

be used

now

selecting investment securities.'

Because of the
dustries

wide range of in¬

which

in

the

mutual

funds

FIF

full

1957.

,

a

dividend of $1.15 per share

from which 88.9 cents
came from capital gain.
/
The corporation's common stock
paid

r

holdings

at. Sept. 30, 1958 repre¬
sented total invested assets "in the
following
approximate
percent¬

using in their efforts
contain, if not retard, the inflation psychology which has devel¬
oped, because of the fear of the future
purchasing power of the
monetary unit.
'
'
'
\
'
•11
A
The latest

Washington,

No

modestly than in the recent
weighs on the one hand the risks
while tobaccos continue in
of 'less-valuable'- dollars against
an established upward trend and
the risks of fluctuating values and
merchandising stocks still / Offer /income
characteristic of his com¬
attractive values
that
prompted
mon
stock investments.
Yet, he
an earlier study's calling attention
realizes

past

higher rates of return was very
And in time the member banks would most
likely have
taken full advantage of the
privilege.
great.

/

;

G, P. S, Share

Assets Record
/

Net

the

assets

Street

To $6.09

$30,182,661,, equivalent - to
$6.09 per share oil 4,956,528 shares

werp.

of common stock

outstanding. The
report states that on Sept. 30 a
ypar ago the asset value was $5.03
and points out that a comparison
of

these

include

two

the

asset

values

jear-end

should

distribution

of 14 cents per

net gain on

share from realized
investments. At Sept.

30, 1957, the net assets
917,066.
"

:

The

$24,-

were

report .also

compares/the
1958 value of $6.09 per
share with that of $4.02 at Dec.
Sept. 30,

31, 1957 and $5.61 at June 30, 1958.
% '

Principal purchases for the

quar¬

ter included initial investments of

shares of

Joy Manufacturing; Re¬

public Steel and
vestments
,

of

addition

shares

of

to in¬

Houston

Lighting-& Power; Idaho Power;
Tampa

Electric;

Transcontinental

Gas

Pipe Line; and U. S. Steel.
Eliminated from the portfolio was
the corporation's investments in
Aluminium Ltd.; Arkansas Louisir
ana

,

.

At

Gas and Standard

Sept.

30,

1958,

Packaging.
holdings

of

Utility common stocks represented
50% of tptal net assets; natural
gas transmission and distribution

of

Fund,

the

open

Mutual

of

from the 8,072,964 at Dec.

compared

$9,045,386

asset

value

three

stood

at

$12.52 at Sept. 30, up from $10.79
at the start of 1958 and $12.04 at
June

30.

"During the past three
months," the chairman noted, "val¬
ues

of

common

-assets'8%.

.




an

increase of

improved markedly, but this gain
offset to some extent by lower
bond and preferred stock prices."
Common stocks made up 54.8%
of the Fund's net assets at Sept.
30. This was up from 52.1% three
months earlier and 48.7% at the
beginning of the year., Mr./Ran¬
dolph said that "the common stock
of

the-

portfolio

has/In¬

creased

primarily as a conse¬
the rise iri common
stock prices and the decline in
prices for fixed-income securities
which have taken place.
There
has been no basic change," he
stated, "in. Whitehall Fund's policy
of operating with a portfolio bal¬
anced
about
evenly between
quence

of

fixed-income securities and
mon

com¬

stocks."

Within the

stock cate¬

established by the purchase

of shares of Standard

(Ohio)
and
Allied Chemical.
Common
stock investment positions were
eliminated* in Arizona Public
Oil

U. S. Rubber.

of its year-end

care

the desire

on

colossal flop.

high Central Bank rate, and it is still not
sense

that most other Central Bank rates

symbol

a

are.

;

r

increase

in

also

penalty rate in the
It is, however, the

sign of what the monetary authorities think about the :
they are trying to do in the battle

or

=$7.74; Axe-Houghton Stock
Fund, $3:28 to $3.88; Axe Science

out to be true over

$10.52; ./Axe -Templeton

Growth
Fund.of Gapad^,.$18.91 to $25.24.
-/ The total and share values of
Fund

for

B

tember 30 do not include
net

29

profits

cents

a.

cents

and

a

a

a

Sep¬

distri¬

share

dividend

from

of

6

share from income which

paid October 24 to share¬
holders of record September 26.
were

c

The number of shareholders for

the five funds
the

rose more

nine-month

89,163 to 97,462,

than 9%

period—from

;

Also, the impeding

Income Founclation
Fund
The
the

has

opened

Reports

unrealized appreciation in
of Income Foundation

value

Fund's

portfolio securities over
was $600,425 as of Aug.
There were 2,927,690
shares of the Fund outstanding,
with total net assets of $6,932,016.

their cost

29,

1958.

Common

stock

changes

in

a

Bonding & Insurance; Mead John¬
son & Co; Merck & Co;
MinnegPr
olis-Honeywell Regulator: Jfah*
tional
Cash
Register: National
Life & Accident Ins. Co. of Louis¬
ville; Peoples First National Rank
&
Trust;
(Chas.) ' Pfeer
and
Southwest Gas Producing.
•5

•

_

y

*. -

f

'

u

- •

v

r

First California Branch

the

portfolio during the period May
20-Aug. 29 were as follows:

PASADENA, Calif —First Cal¬
ifornia Company has opened a
branch office at 595 East Colorado

American Airlines;
Street under the management of
Tobacco; Consumers George R. Liddle.
Power;
Island
Creek
Coal;
Motorola; Ohio Edison; Reynolds
Atlas Adds to Staff
Tobacco and Southern Co.
Additions:

American

Eliminations:

Aluminum Co. of

(Special to The Financial CH*om<3JE)

LOS ANGELES, Calif .—James
American Home Prod¬
ucts; Commonwealth Gas; Com¬ W; Odom and Lawrence Pleener
monwealth Life Ins.; Dow Chemi¬
have been added to the staff of
cal; Ford Motor; General Crude
Oil:
General Motors; Gulf Oil; Atlas Securities Inc., 6505 WilsWre

America;

/ QGEANSIDE, Calif.—Norman C.
Company

period of time, then the policy of "comfort¬
doubt be continued.

be carried out successfully.

'

Norman Roberts Branch
Roberts

a

Treasury financing will most likely mean that the money market
will be supplied wtih funds so that the Government
operation will

Electronics Corporation, $9.06 to

of

continue

Axe-Hough -

to

bution

It is evident that if the forces of inflation

able restraint" will no

reports

ton Fund A, from $4.78 to $5,36;
Axe-Houghton Fund B, from $6.73

Axe-Houghton

-

strength, there will be higher interest rates and tighter
credit conditions. For the moment, at
least, it seems as though the
inflation psychology is not
gaining in momentum and if this turns

the asset value of

its shares, as follows:

/

trend of interest fates, and what

According to preliminary fig¬
ures, the total was $158,680,285 on
September 30 as against $128,513,978 last December 31.
All five
funds participated in the advance.
Each of the funds

-

does not make it a

to gain

an

,

/

the part of

Warning From the Central Bank

than $30

gory of investments, new positions
were

a

with inflation.

in
common

and to take

The increase in the discount rate to
2V>%

23.5% in total net assets

was

content

more

was evident that the
Central
before the Government went in the

new money

was

by $30 Million

or

raised

operation by the Treasury, unless it

during the first three quarters of

stock investments

T2%;/ oil and natural: gas-produce
tiori 11%'; miscellaneous industrial
-19%; arid cash arid other current Service*, Brooklyn Union Gas, and
.

port

be

the monetary authorities to make it

The five mutual funds sponsored
by Axe Securities Corporation re¬

million

to

market to obtain

1958.

with

months ago.
Per share

31 and

other

or to be held off until sometime in the future. The CenBank rate could not be raised in the middle of
a financing

tral

Axe Fund's Assets
Rise

the

help clear the decks for the

maturities,

progress."
t

record

a

done to

was

coming financing of the Treasury. It

Broad

Funds,
$9,683,849 at
Sept. 30.
Francis F. Randolph,
chairman and president, reported
that this was a gain of almost 20%
reached

General Public Service Corporalion/ closed-end investment com¬
pany,-reports that its net assets
at market "value on Sept. 30, 1958,

fund

Group

High

Whitehall

of

balanced

rates last week

Bank rate had

Whitehall's Net

i/

,

Prelude to Treasury Borrowing
bringing into line of the discount rate with

The
money

,

material

at

Bank rate and invest these funds at

that wealth in the form of

ago.

our

they are still not large. Nonetheless, with the
at the low level of
2%, the temptation to borrow
the Federal Reserve Banks at the depressed Central

discount rate
money

ages:

enrich

,

but in spite of this

.

to them several months

more

security*
Therefore, it is not expected that there will be any
appreciable
pick-up in discounts and advances with the Federal Reserve Banks.
Borrowings from the Central Banks have been on the increase,

of action

soundly diversified ownership' in¬
pil, 43%: chemical and drug,
Concerning securities in indus¬
terests—s\jich as those acquired
17%; metal , and mining,
12%; tries noted for their cyclical price
through Financial Industrial Fund,
manufacturing and miscellaneous, actions, the report finds "excel¬ Inc. and other
mutual
funds—
7.50%; electric utility, 2.25%; nat¬ lent values and generous yields",
characteristically keeps pace with
ural gas, 1.50%; and merchandis¬ in railroad bonds at price levels
the future progress of the welling,- 1.50%.
U.- S. Government relatively deflated in comparison known
business enterprises which
obligations amounted to 14.37%; with rail stocks.
serve
our
growing requirements
cash
and
receivables, .88% and
for new and better products and
Other-investments, .15%.
services—all of which combine to

was a

leaves it below the yield which is available
in the 91-day Treasury
obligation. However, the 2%% discount rate is
relatively close to
the return which is available in the shortest
Government

guarantees his ultimate estate. He

more

increase, according to spokesmen in

technical correction aimed at
bringing the Cen¬
in line with rates in
general in the money
market. The discount rate
usually does not remain below the bill
rate for long, yet this recent
upping of the Central Bank rate still

"carving out his
course

"Technical Correction"

discount rate

tral Bank rate

number of years with which

.own success.

•

procedure it used when margin requirements
to 70%. It was only a short time after the

to

.

he has to work in

/

Pattern

carrying equities (from 50% to 70%) was put
effect that the Central Bank rate
was upped.
When margins
recently went from 70% to 90%, it was likewise followed in
about
a week's time
by the current increase in the discount rate.
T|ie
raising of margin requirements and the discount rate is part of
q
pattern which the monetary authorities are

assets.-/Major industry

,

was

same

/

-

a

in

included
chemicals,
electronics, 7.1 %; and util¬

13.3 %

<

'

raised from 50%
increase in cost of

were

ities, 9.1%,
In his letter to FIF sharehold¬
ers, President Charles F, Smith
comments, "The investor—our fi¬
nancial planner of today—realizes
-that his destiny is not wrapped
up in the events of a few months,
but, instead, rides the tide of the

21

Group
invest,
the
report
comments
on
their
prospects. In the group of indus¬
1957.
/:•■•//'• * "u//'v V./:/ : tries'* : generally
identified
with
/ During the first three, quarters growth, it finas petroleum stocks
pf / the current year dividends Offering : excellent
quality
and
amounting to $1.20 per share were value.
In ./the
group/; noted for
paid, of which 75 cents per share their relative stability of principal
represented payments from net and income, both food and utili¬
realized capital gain. On Dec. 27, ties stocks are expected to advance
Securities

pretty much the

investments

,

v:

The Federal Reserve Board in
allowing the Federal Reserve
to increase the discount rate
from 2% to 2*6% followed

& Co.r As of Aug. 31,
1958, • investments in/the drug in¬
dustry- accounted for 4.4% of the

warning
It urges

a

'

Banks

and.Pfizer

in the stock

ions

that " "extreme care"
in

with"a net asset

compares

market;

'

Following

are

Sept. 30,' "inflation sentiment"

$121,362,554, equivalent to

a

The action last week in
raising the Central Bank rate from
2% to 2%% will probably not
bring about an immediate increase
in other
borrowing rates, unless the money market is further
tight¬
ened by the powers that be, and
.a sharp and more than seasonal
demand for loanable funds
develops. The credit limiting measures
of the monetary authorities
appear to be in a neutral area, for the
time being.
*
"
:
'

long depressed industries, that; term growth potential of the drug
far below/their high prices of industry by making initial pur¬
chases Of Bristol-Myers Co.; Eli
recent years."
"/*■/*/''/
+
/
United States arid Foreign Se¬ •"-"/ Recalling its warning earlier in Lilly & Co.; McKesson & Robbins
curities Corp., closed-end, invest-; tlie/year against over-pessimisiri, Co.; Merck & Co.; Norwich Pharmerit company,/ reports an indi¬ the study suggests that current macal Go.; Parke/ Davis & Co.;
cated

month, and

interest rates.

the

$.11.86 from $31.25;/

.

by the Treasury early
$12,000,000,000 refunding operation the end of
November.
Nevertheless, a rising Central Bank rate, whether
ahead or behind the other
money rates, does not forecast lower

next

will grow by more than 30 million

rate

average

■}^,"vl

■.>

/> •//. A.
similar/ disparity

Reserve

with the other open market
money rates was taken in advance of
some
$3,000,000,000 of new money raising

the long-term
outlook for our: economy in the
creases in holdings' 'were irv shares" lies^inc!/^/////,,:!: //v
"/It notes .that The Federal Re/ 1958 Annual Report, the Fund's
Of Iowa-Illinois
Gas & /Electric*
serve
Board
index, of
over-allv management estimates gross na¬
Co.; / Rochester Gas & f Electric
production has risen to a point tional product will increase by
Corp ; / Illinois Power Co.; San
only 7% below its all-time peak, 48% during the next ten years to
Diego Gas & Electric Co.; Minne¬
but-finds many basic industries $634 billion / and our population

apolis-Honeywell Regulator Co.;/
lagging behind this
Schering Corp.: Guaranty Trust'

Governments

on

By JOHN T. CHIPPENDALE, JK.

.

change

-

Reporter

Stock Purchases

V

' ■■:

'

blanch office at 60? Third Street
under the management of John E.
J#yffprsnn
Lucas.

Standard

Life

Ins.:

40
'■

The Commercial and Financial Chronicle

(1804)

i

■■

.

.

.

Thursday, October 30,1950

.

* INDICATES

Securities
Acme United Life Instance Co.,

Atlanta, Ga.
stock (par $1)

being offered for subscription by common stockholders
shares for each two shares held
©f record June 30, 1958: rights expire on Nov. 17. Price
—$0.25 per share to shareholders, and $7.50 for any un¬
subscribed shares. Proceeds—For working capital and
at the rate of three new

Underwriter—None.
(N, Y.j

American-Caribbean Oil Co.

shares of common stock (par 200).
Price—To be supplied by amendment. Proceeds — To
discharge current liabilities and to drill ten wells. Un¬
derwriters—To be named by amendment, v
Feb. 28 filed 500,000

^ Bridgehampton Road Races Corp.
(letter of notification) 15,000 shares of common
stock (par $1) to be offered for subscription by stock¬
holders of record Nov. 1, 1958 on the basis of one new
share for each four shares held; unsubscribed shares
will be offered to current creditors in payment of all
or part of claims, at-the rate of one share for each $4
of claims discharged; lights to expire about two weeks
after mailing of offer. Price—$4 per share. Proceeds—
To pay current creditors.
Address — P. O. Box-506,
Bridgehampton Road, L. I., N. Y. Underwriter—None.
Oct. 23

it Bullock Fund, Ltd., New York
24

Oct.

shares

3^ American International Bowling Corp.
28 filed 770,000 shares of common stock (par 10
cents). Price—$3 per share. Proceeds—To acquire and
manage bowling alleys.
Underwriter—Netherlands Se¬
curities Co., Inc., New York.
;
..

filed' (by

of

amendment)

capital stock

(par $1).

Proceeds—For investment.

additional 750,000
Price — At market.

an

;

-

7

Oct.

American Mutual Investment Co., Inc.

capital stock. Price—$10.20
share. Proceeds—For investment in first trust notes,
second trust notes and construction loans. Company may
develop shopping centers and build or purchase office
buildings. Office — 900 Woodward Bldg., Washington,
D. C.
Underwriter — None. Sheldon Magazine, 1201
Highland Drive, Silver Spring, Md., is President.
Dec. 17 filed 490,000 shares of

per

American TelemaS! Service,

Inc.

Feb. 17 filed 375,000 shares of common stock (par $1)

Frice—$4 per share. Proceeds—To purchase equipment
and supplies and for working capital and other corporate
purposes.
Office—Salt Lake City, Utah Underwriter
Amos Treat & Co., Inc., of New York. Change in Name
—Formerly United States Telemail Service, Inc.
•

Ampal-American Israel Corp., New York
10-year discount convertible
debentures, series E. Price—61.027% of principal amount,
payable in cash or in State of Israel Independence Issue
or Development Issue bonds.
Proceeds—For develop¬
ment and expansion of agricultural, industrial and com¬
mercial enterprises in Israel. Underwriter—None. State¬
Aug. 8 filed $3,289,100 of

ment effective Oct. 21.

-

Angelica Uniform Co., St. Louis, Mo.
Opt. 6 filed 150,000 shares of outstanding common stock.
Frice—To be supplied by jamendment (expected at $10
per share). Proceeds — To selling stockholders. Under¬
writers-—Scherck, Richter Co., and Dempsey-Tegeler &
Co., both of St. Louis. Mo. Offering — Expected this
^

writer—None.

/

it Cedco Electronics, Inc., Erie, Pa* 7,
(letter of notification) 99,900 shares of common
stock (par 10 cents). Price—$3 per share. Proceeds—

^ Central Electric & Gas Co., Lincoln, Neb.
Oct. 28 filed $2,000,000 of convertible subordinated deben¬
tures due 1973 and 20,000 shares of cumulative preferred
stock ($50 stated value per share). Price—For preferred
stock, $50. per share; and for debentures, to be supplied
by amendment.
Proceeds—To repay bank loans, for
investments and for construction program. Underwriters
—Paine, Webber, Jackson & Curtis and Stone & Webster
Securities Corp., both of New York.
/
•

•

Chemirad Corp.,

East Brunswick, N. J.

(11/5)

; Arvida Corp., Miami, Fla. (11/18-21)
Oct. 28 filed 2,500,000 shares of class A-common stock

June 30

'

.

■;

;

.; •,?.

■

;■• ■' 1 *v

v

Anita Cobre U. S. A., Inc.,

<par $1). Price—To be supplied by amendment (expected
to be approximately $11 per share). Proceeds—Together
with other funds, will foe used for development of the
company's properties and for working capital. Under¬
writers—Carl M. Loeb, Rhoades & Co. and Dominick &
Dominick, both of New York.
-Automation Instruments, Inc.
Oct. 7 (letter of notification) $250,000 of 6%
15-year
convertible sinking fund debentures to be offered for

subscription by stockholders of record Oct. 1, 1958. Un¬
subscribed shares to public. Price—90% of face amount
(in denominations of $100, $500 and $1,000 each). Pro¬
ceeds—To retire notes payable to bank and others and
for working capital.
Office—401 E. Green Street, Pasa¬
dena, Calif. Underwriter—None.
...
,
v.
.

-

Autosurance Co. of America
Oct. 16 filed 250,000 shares of common stock
(par $2.50).
Frice—$5 per share. Proceeds—To increase capital and

surplus.

Office—Atlanta, Ga.

Underwriter—None.

Bankers Fidelity Life Insurance Co.
Fel>. 28 filed 258,740 shares of common stock (par $1)
©f which 125,000 ; shares are to be offered
publicly .and
133,740 shares to employees pursuant to stock purchase
options. Price—To public, $6 per share. Proceeds—For
expansion and other corporate purposes. Office —At¬

Cinematic II Productions,

Inc.
(letter of notification) 300,000 shares of common
{par 10 cents). PricS^-$l per share. Proceeds—
For working capital. Office — 937 Acequia Madre Rd.
Santa Fe, N. M. Underwriter—Watson & Co., Santa Fe
stock

N. M.
O

Clary Corp.
Aug. 27 (letter of notification). 75,000 shares of common
stock (par $1) being offered for subscription by common
stockholders of record Oct. 15, 1958 on the basis of one
new

share for each 12 shares held (with

an

oversubscrip¬

tion privilege); rights to expire on Nov. 7. Price—$4 per
share. Proceeds—For working capital. Office—408 Junipero

St., San Gabriel, Calif.

Underwriter—None,

Clute Corp.

Underwriter—None.

,

Bankers Management Corp.
(11/14)
10 filed 400,000 shares of common stock

Feb.

(par 25
cents.) Price—$1 per share.
Proceeds—To reduce out¬
standing indebtedness and for working capital. OfficeHouston, Texas. Underwriter
McDonald, Holman &
—

Co., Inc., New York.

Aug. 21 (letter of notification) 300,000 shares of common
stock (par one cent). Price—$1 per share. Proceeds—To
pay additional costs of construction; and for retirement
of obligations and working capital. Office — c/o John
Harlan Lowell, 2200 Kenton, Aurora, Colo. Underwriter
—Lowell, Murphy & Co., Inc., Denver, Colo.

April 14 filed 8,934 shares of common stock. Price—At
($100 per share). Proceeds—For general corporate
Underwriter

ville, Ky

—

Bankers
i

■■

Bond

Co.,

Louis¬

Bowling Corp. of America (11/3-7)
Sept, 11 filed 450,000 units, each consisting of

one

share

(par 10 cents) and two common stock
warrants, one warrant to' expire 18 months
from the date thereof, exercisable at
$3.25 per share, and
one warrant to expire 30 months from
the date thereof,
exercisable at $3.50 per share. Price—$3
per unit. Pro¬
ceeds—For working capital. Underwriter—Charles Plohn
purchase

&

Co., New York.




Colonial Aircraft Corp., Sanford, Me. (11/10-14)
8 filed 346,492 shares of common stock (par 10

cents). Price—75 cents per share. Proceeds^—To reduce
loans, make certain capital improvements and for work¬
ing capital. Underwriter—Mallory Securities, Inc., New
York.

-

•

of common stock

/

f

Oct. 123 filed 111,489 ; shares ofcommon stock .(par
$1.33 Is ). Price—To be supplied by amendment. Proceeds;
—To. selling stockholders. Underwritcrs-7-Kuhn, Loeb <&

Co., New; York, and A. C. Allyn & Co., Inc., Chicago, I1L

Co^umero-'Fowar^Cbi"
Aug; 29 filed 150,000 shares of preferred stock-(no par).
Price—To be supplied by amendment Proeeeds-^To- re¬
pay short-term bank loans and for. (expansion and im¬
provement of service facilities. Underwriter — Morgan
Stanley & Co., New York. Offering—Postponed indef¬
initely. J. •;
7 , -/
.\\f-.TiV 7, " '•/
7
Counselors

.

Feb.

Research Fund, Inc.,. St. Louis# Mo.
100,000 shares Of capital stock; (par one
Price—At market. 7 Proceeds—For? investment.

filed

5

cent).

Underwriter

—

Counselors. Research

Sales

Corp.; SL

Robert H. Green, is President.

Louis.

Cryogenic Engineering Co.
Sept. 22 (letter of notification) 150,000 shares of class A
common stock (par 10 cents).
Price—$2 per share. Pro^
ceeds

—

For repayment of loan; purchase of plant

and

office equipment; raw. materials and supplies;

and for
working capital, etc. Office—U. W. National Bank Bldg;#
1740 Broadway, Denver, Colo. Underwriter—L. A. Huey^
Denver, Colo.

Voting Trusts,

Havana, Cuba.
March 31 filed 767,838 units of voting trust certificates,
each certificate, representing the ownership of one share
of common stock
(par one-half cent) in each of 24
Cuban companies. Price — To be supplied by amend*
ment.
Proceeds—For capital expenditures, exploration
costs and other corporate purposes. Underwriter—None.
Derson Mines Ltd.

-

June 5 filed 350,000 shares of common stock;

Price—$1
share. Proceeds—For new equipment, repayment of
loan, acquisition of properties under option, and other
corporate purposes. Office—Toronto, Canada, and Em*
porium, Pa. Underwriter—None.

per

Dow Chemical Co., Midland, Mich.
Sept. 11 filed 175,000 shares of common stock (par $5)
being offered to employees of the company, its subsidi¬

aries, and certain associated companies at $55.75 per
share; subscriptions will be accepted from Oct. 13
through Oct. 31. By a separate registration statement the
company plans to offer 12,500 additional: shares of the
said stock to employees of Dow Corning Corp., a 50%
owned subsidiary of the corporation.
•

Eastern Stainless Steel Corp.

Oct.

6

filed

$5,123,600 of 5%

convertible subordinated
initially to
amount of

debentures due Nov. 15, 1973, being offered
stockholders on the basis of $100 principal

debentures for each 14 shares of

common

stock held

on

Oct. 28,1958; rights to expire on Nov. 12. Price—At 100%
of principal amount (flat). Proceeds — Together with

other funds, will be used to retire approximately $4,000,000 of 4V2% notes, to increase plant facilities, and to
finance additional inventories; Underwriter—Hornblower
&

Weeks, New York.

it Electronics Communications, Inc. (11/17-21) 100,000 shares of common stock (par $1).
Price—To be supplied by amendment.
Proceeds^—For
working capital and general corporate purposes. Office—
St. Petersburg, Fla,
Underwriter—Laird & Co., Corp.,
,

New York.

'

Ethodont Laboratories* Berkeley, Calif.
Feb. 20 filed 300,000 shares of common stock.
.

Kt par
expense

Price—

($5 per share). Proceeds—To cover operating
during the development period of the corpora*

Mom Underwriter—None.

Exploration Service Co., Ltd., Far Hills, N. J.
Aug, 11 this company and Amkirk Petroleum Corp.
(latter of Fort Worth, Texas) filed $400,000 of working
interests (non-producing in Sinu Valley Project), to be
offered for sale in $12,500 units (of which $8,000

Is

pay¬

able in cash and $4,500 is to be

represented by promis¬
notes). Proceeds—Exploration .Service Co. to ac¬
quire 80% interest in a certaio concession from Amklrk
and for exploration program. Underwriter—Cador, Inc.,
Far Hills, N. J.
sory

Oct.

par

purposes

^ Coleman Engineering Co., Inc.
filed $1,000,000 of 6% sinking fund debentures
'due 1973, with' warrants
(a- warrant to purchase 30 common shares will be attached to each $500 principal
amount of debentures or a total of 60,000 shares, and
will be issued without the payment of additional con¬
sideration therefor). Price—100% of principal amount.
Proceeds—To retire short-term borrowings; for antici¬
pated increases in inventory; and for. additions to work¬
ing capital for general corporate purposes. Underwriters
—Wilson, Johnson & Higgins, San Francisco, Calif, and
Lester, Ryons & Co., Los Angeles, Calif.
Oct. 27

•

Bankers Southern, Inc.

,

/

....(ii/io«ri4);\v-:.r.7/

v:

Oct. 24 filed

-

lanta, Ga

-•

it Consolidated Foods Corp., Chicago, III.

Cuban-Venezuelan Oil

Inc.
Sept. 9 filed 4,000,000 shares of common stock (par 10
cents), represented by voting trust certificates, of which
3,530,000 shares are to be offered to the public and the
remaining 470,000 shares have been issued to nine per¬
sons, who may sell such shares at the market. Price—60
cents per share. Proceeds —For construction of racing
plant and acquisition of equipment. Office—Charles-r
town, W. Va. Underwriter—None.

Phoenix, Ariz.
Sept. 30, 1957, filed 85,000 shares of common stock.
Frice—At par ($3.75 per share). Proceeds—For invest¬
ment in subsidiary and working capital. Underwriter—
Selected Securities, Inc., Phoenix, Ariz.

week.

Refining Corp* vv
•/
16,1957 filed $25,000,000 of first mortgage bonds due
Sept. 1, 1968, $20,000,00 of subordinated debentures due^
Oct. 1, 1968" and 3,000,000 shares Jf common stock to be!
offered in units as follows: $l,00tr of bonds and 48 shares:
of stock and $100 of debentures
nine shares of stock.
Price—To be supplied by ameiwinent. Proceeds — To>
construct refinery* Underwriter—Lehman.Brothers, New
York. Offering—indefinite. ;
•*.
'/r
/

,

Charles Town Racing Association,

Sept. 25 filed 165,830 shares of common stock (par 10
cents) to be offered for subscription by holders of com¬
mon stock of Cary Chemicals Inc. of record Oct. 31, 1958
at the rate of one shard for every four shares of Cary
Chemicals common stock held; (with an oversubscription
privilege); rights to expire on Nov. 25, 1958. Price—$2
per share.
Proceeds—For expansion program. Under¬
writers — Lee Higginson Corp. and P. W. Brooks & Co.,
Inc., both of New York.

•

REVISED

Commerce Oil

Oct. 16

For general corporate purposes.
Underwriter—Herbert
Perry & Co., 70 Wall St., New York, N. Y.

ITEMS

Dec.

Carrtone

Laboratories, Inc., Metairie
(New Orleans), La.
July 2 filed 600,000 shares of common stock (par 10
cents). Price—$5 per share. Proceeds—For expansion,
working capital and other corporate purposes. Under¬

ADDITIONS
SINCE PREVIOUS ISSUK

•

in

June 30 filed 315.000 shares of common

general corporate purposes;

;

Columbia Gas System, Inc. (11/6)
10 filed $25,000,000 of«debentures,

Oct.

series K,

due
Gas
Co. and for construction program. Underwriter—To be
determined by competitive bidding. Probable bidders:
1983.

Proceeds—For acquisition of Gulf Interstate

Halsey, Stuart & Co. Inc.; Morgan Stanley & Co.; Merrill
Lynch, J Pierce, Fenner & Smith and White, Weld & Co.
(jointly). Bids-r-Tentatively expected to be received by
company up to noon (EST) on Nov. 6,

Federal. Commercial Corp.
May 21 (letter of notification) 300,000 shares of common
dock (par 10 cents).
Price—50 cents per share. Pre¬
eeeds—To make loans, etc. Office — 80 Wall St., New
York, N, Y. Underwriter—Dumont Securities Corp., New
York, N. Y.

Federal Pacific Electric Co.
Oct

10

filed

70,000 shares of

.

stock (par $1).
portion of the 111,910 shares pre¬
viously issued or set aside for issue in connection with
recent acquisitions. Price—To be supplied by amend¬
ment. Proceeds—To selling stockholders. Underwriter
These

shares

—None.

are

a

common

.

Volume 188

Number 5790

.

The Commercial and Financial Chronicle

.

.

(1805)

★ Fluorspar Corp. of America

Price

To be supplied by amendment.
Proceeds—
To pay short-term bank loans and for
additional invest¬
ments in domestic subsidiaries.
Clearing Agent—Merrill

Oct. 14 (letter of notification)
133,333 shares of common
stock (par 25 cents). Price—$2.25
per share. Proceeds—
For mining expenses, Office—4334 S. E. 74th
Ave., Port¬
land 6, Ore.r Underwriter — Ross

—

Lynch, Pierce, Fenner & Smith, New York.

Securities Inc., New

i Gray Manufacturing Co., Hartford, Conn.
Oct.

Oct.

Fremont VaUBy Inn
Aug. 6 (letter of notification) 300,000 shares of common
stock. Priced—At par ($1
per share). Proceeds—To erect
:

ceeds—For reduction of notes.

Freeport, L. I., N. Y.

and operate an activities

building, comprising a restau¬
rant, cocktail lounge and coffee shop. Office—3938 Wilshire Blvd., Los
.Angeles, Calif. Underwriter—Oscar G.
Werner & Co., Pasadena, Calif.
:

Office—65

Pro-1
.

.

,

24

filed 75,000 shares of common stock
(par 20
Price—To be supplied by amendment. Proceeds
'—To purchase additional
equipment and tooling for

Proceeds—Fomcquisition of stock Of -National .Missile <St
Electronics Carp^ additional working capital and other
corporate purposes. Underwriter—Willis E. Burnside St
Co., Inc., New York. >/.;v'/Y •; V,v
•'

•

.

;

.

.sion nf operations and

/::/(.

i

I:

★ Grand Union Co.

•

Oct.

General Aniline & Film
Corp., NowYork
USTfUeiGBJU dares of common A stock (ne
par) and 1£37,SOO shares of common Batock (par
$1)
Proceeds—To lhe Attorney General of the United,
fitatas

29

filed

organizers,
incorporators, 'management*
directors. Piiee
$10 per share. Proceeds—For
working capital^ and general corporate purposes. Under¬

187,534 shares of

stock

outstanding

,

termined

(par $5)

80%

common stock
>

acceptance by " at

of

the

DOtstanding Sunrise shares.'

• GeneraM^iWic -Utilities Corp. (41/3)
Oct" ! fited a mnximum 539,000 shares of common stock
-jpar $5) to be offered tor subscription by common stockholders at therale of

^

new-share for each 20 shares-

one

X held on OcC M; 1958; rights to expire

Nov. 21/195&

on

Great Amarican NaaRy
Curp^ N. -V.
Aug. 18 Bled 484,000. shares of class A stock (par • M)
cents). Of thisstock, the company proposes to offer
400^000 shares and certain selling stockholders 40^000
shares, toe remaining 44,000 shares being subject to
option to be offered for the account of the underwriters

Hamilton

Corp.
(1/060)000) shares of common stock (par 23
cents). Price—$2 per share. Ptaeecds-^To acquire funds
to test drill, explore, and develop oil and
gas properties.
.

Underwriter—None,

r [The registration includes an ad588,000 common shares issuable upon exercise
1,176,000 options rights previously offered (Oct. 19^

1

ditional
of

1957); -which - rights ) entitle the original J purchaser
thereof to purchase one-half share of stock at 50 cental
share at

Hanna

.

t

,-V,

?,

f

■

I

\\

'

'

"T

V •

'

■

'

1

>"

'

'

~

*'■

V

'

-s

■

,

»•"

•

J£'

,.

October 30 (Thursday)
.• T'J'
Chicago &Narth Western Ryw^JEquip. Trust Ctfs.
:

.(Bids

-

;

■

-

-

'

'

CDT)'$1,875,000

-noMi

October 31

;

Kentucky -Co.

and

^

»

Scherck,

.{Milton X>.- Blauner

.

Richter

Co.,

Inc.)

Tenney Engineering,

Co.)

&

Bank

_

V;*

the

expiration of

•;

*

'

vWovambar ■%

;

r -

r<Bids

noon

.

.(Bids

.

U

EST)

November 7
Hanna

1

.

,

T. I. M.
-

(Blyth

<Sc

Co.,

underwritten)

December 9

Read
&

<fc

Co.

Co.

.

November 10

(Bids

$50,000,000

Texas

Power

&

to

be

December 18

--Bonds

(Bids

Foods

Corp

Equip. Trust Ctfs.
$6,450,000

(Kuhn, Loeb & Co. and A. C. Allyn & Co..
Inc.)

-(Kuhn,

Loeb

&

Co.)

100,000

November 12

(Bids

noon

shares

November

14

Holman

<fc

November 17
Electronics
.

.,

■'

&

Co.,

Corp)

Michigan

Bell

Montana

Power

$5,310,000

(Bids

Common
Co.,

Inc.)

$400,000

Panama

Common
shares

(Tuesday)

Arvida Corp
(Carl

M.

Class A Common
Loeb,

Rhoades

&

Co.

and

Dominick) $27,500,000




Co

Dominick

&

for

one

10

shares

subscription

share

of

of

by stockholders

convertible

common

stock

preference
held

on

or

on

the basis

stock
about

for

each,;
1,

Nov.

+

Stockholders will have 45 days in which to exer-~
the rights.
Price — At par. Proceeds —To repay'

debts, acquisition of investments, and for general pur¬
Address—P. O. Box-348, Albany, N. Y. Under¬

^Heli-Coil Corp., Danbury, Conn.
24

filed

(11/18)

$1,300,000 of convertible debentures

due

1, 1973 and 180,000 shares of common stock (par
$1). Price—To be supplied by amendment. Proceeds—
For working capital and other corporate purposes. Busi-1
Underwriter—W. C. Lang¬

Bonds

to be Invited)

$20,000,000

(Republic of)
(Lehman

Brothers)

$16,700,000

to be Invited)

Bonds
$8,000,000

Southwestern Bell Telephone Co
(Bids to be Invited) $110,000,000
Utah Power & Light Co.
(Bids

to

be Invited)

Debentures
Bonds

$20,000,000

Hoaglantf A Dodgo Drilling Co., Inc.
shares of capital stock. Price—$10:
share. Proceeds—To be used in part for the ex¬
ploration of mines and development and operation of
mines and in payment of indebtedness. Office—Tucson,
per

Ariz.

Bonds
Bonds

Pennsylvania Power Co

common

(pai' $1), ■ Price—$5 per share.
Proceeds—For
payment of past due accounts and loans and general >
working capital. Office — 35-10 Astoria Blvd., L. I. C.
3, N. Y. Underwriter—Albion Securities Co., Suite 1512,
11 Broadway, New York 4, N. Y.
June 12 filed 27,000

Debentures

$40,000,000

Co

Moore-McCormack Lines, Inc.

(Bids

November 18

$10,000,000

(Kuhn, Loeb & Co. and Lehman Brothers) $24,000,000

(Monday)
100,000

Telephone

(Bids to be invited)

(Friday)

Communications, Inc
(Laird

$17,000,000

Bonds

(Bids to be invited)

Equip. Trust Ctfs.

Bankers Management Corp
(McDonald,

Bonds

(Bids to be invited)

(Thursday)

-(Bids to be received)

November

Preferred

Laclede Gas Co

13

Development Corp. (11/1)
of notification) ' 22,820 shares of non¬
convertible preference stock (par $12) to be
(letter

stock

(Morgan Stanley & Co.) $15,000,000

Gulf States Utilities Co

$2,610,000

Norfolk & Western Ry.

23

Oct. 22

Postponed Financing

Common

(Wednesday)

CST)

Nov. 21.

Heliogen Products, Inc.
(letter of notification) 28,800 shares of

111,489 shares.

Equip. Trust Ctfs.

on

ness—Manufacturer of tools.

Consumers Power Co

Illinois Central RR

share for each

new

expire

ley & Co., New York.

Common

Tishman Realty & Construction
Co., Inc.

filed

Nov.

(Thursday)

to be received)

j

Heartland
Oct.

Oct.

$12,500,000

Norfolk & Western Ry

Common

.

writer—None.

(Tuesday)

invited)

.

poses.

Light Co

(Bids

and Halsey,
$30,000,000

,

10 shares then held; rights*
Price—$42.50 per share. Pro¬
ceeds—To become part of the general funds of the com¬
pany and will be applied toward the cost of the com¬
pany's construction program. Underwriter—None.
:
;
one

cise

.XMallory Securities, Inc.) $259,869

Consolidated

of

voting

Bonds

.

filed

of
.

;

Price—To

Co., Ltd.
84,700 shares of common stock (par $20)
being offered for subscription by holders of its outstand¬
ing common stock of record Oct. 15, 1958, at the rate
8

offered

(Wednesday)

to be invited)

9

,

$70,000,000

shares held.

Light Co.
I - ;
149,633 shares of common stock (par $25)
being offered for subscription by common stockholders
of record Oct. 21, 1958 at the rate of one new share for
each 10 shares held; rights to expire on Nov. K17, 1958.
Price—$56 per share. Proceeds—To repay bank loans
and for construction program. Underwriters—Putnam 8s
Co., Hartford, Conn.; Chas. W. Scrantpn & Co., New
Haven, Conn.; and The First Boston Corp., New York.

1

/

260,000 shares

December 16

shares

(Monday)

/

-!-Cc>iimion

(Tuesday)

share for each 3.45

one

Hartford Electric

will

-Bonds

(Bids to be received)

•

1958.

Inc.

Inc.)

■;

Telephone & Telegraph Co.—Debens.

December 10

Bonds

';
>

$50,000,000

Philadelphia Electric Co

313,038

/ /
:

1

-.-..-—-Common
Inc.)

of

Oct.

Oct

(Tuasday)./;

1^;

E., Inc._

•

share for each 16 shares of the parent's stock held.

G Hawaiian Electric

.

.

(May be Merrill Lynch, Pierce, Fenner & Smith) 700,060 «hazai

$20,000,000

Colonial Aircraft Corp
,

shares

Public Service Electric & Gas Co

.

(Friday)

;

(Tuooday)''

Pacific Gas & Electric Co.—

Minins Co., Clavaland, Ohio (tt/7)

pany is now known, as Hanna Coal & Ore Corp.
.

/—-./

Common

stockholders—not

.Stuart

Son) 206,446

com¬

be supplied by amendment. Proceeds—To reduce bank
indebtedness. Underwriter—None. Present Name—Com¬

j

(Offering to stockholders—underwritten by Blyth & Co., Inc.'
'•; * ;and The First Boston Corp.) 110,000 shares
' '

Bonds

Natural Gas Pipeline Co. of America
(Dillon,

&

.

Southern Bell

'

Mining Co

(Offering to

,

Debentures

EST) $25,000,000

a.m.

-

(Thursday)

Indiana & Michigan Electric Co
:

\

.Common

(Offering, to stockholders of Cary Chemicals Inc.—underwritten
by Lee Higginton'Corp. and P. W. Brooks & Co., Inc.) $331,660

Columbia Gas System, Inc

Hilliard

December 2

,...

Chemirad -Corp.

o

after

;

holders of the latter.' Of the total, 181,606 shares are to
parent at the rath of

rate

Union

l.,

,

,

remaining 131,432 shares are to be offered to the
minority shareholders of the mining company at the

'

.Common

,

•

Eastman Dillon,
$10,000,000

(Bids to be invited)

Navaiuber 5 (Wednesday)

',v".

and J. J. B.

Common
/

and

■

.

'. (Offering ^tO stockholders—underwritten by Domlnick &
V.
Dominick) .'$289,135

-

•;

-.

be offered td shareholder^ of the
one

Debentures

Co.)

.*i v.V.? />£■ November 25

,

(Tuesday)

tJ. S. Polymeric Chemicals, Inc
1

Co.

Securities &

;

.

months

:

The

Chicago & North Western Ry.__-Equip. Trust Ctfs.
:
;
' : (Bids to be invited) $1,875,000
v
/
Tucson Gas, Electric Light & Power Co.—Common

.Common

.

November-4

&

$80^000,000

Corp.

"

13

offering.]

Oct. 17 filed 313,038 shares of common stock to be offered for 'subscription by company's shareholders
(other
than the M. A. Hanna Co., the
parent), and by the stock-

-

,

(Offering to stockholders—underwritten by Blyth Ss Co., Inc.

(Offering to etockholders-^underwritten by William R. Staats.
'.
"J-.:
Co.)- '101,933.. shares '•»,-v

.be.Invited)

Kentucky Utilities Co.__^
.

25,000 shares

to

/ ,;••>/November 24. (Monday)

$2,587,500

.Common

Co.,- Inc.)

,

Langley & Co.). 180,000 shares

Lemon

% ■'

V

$500,900

Inc.____

'i(Mflton I* -Blauner

Valley National

C.

(Bids

(Johnston,

Common

Debentures

&

Common

State Loan & Finance

•

Bonds Sf

"

Pacific Telephone & Telegraph Co.-£^^D(d»cnftBres

agent is Merrill Lynch,
530,000 shares

Tenney Engineering, Inc
,

y

Common

:

-Pierce,.Penner & Smith)

(The

•« >v 'i

••••*

Heli-Coil Corp...Debentures
r
V-. /
(W. C. Langley & Co.) $1,300,000 /V
Heli-Coil Corp.

$1,350,000

Kentucky Jockey Club, Inc
.

'•

;»

Common

fcCharles Plohn .& Co.)

.

General Public Utilities Corp.
•' (
Offertog 4©-^stockholders—clearing

/

•

•

(W.

Bowling Corp. of America—
•. /.

r

•.

(Offering to stockholders—underwritten by Stone &; Webster
Securities':,corp.) $2,478^64

Bonds

November 3 (Monday)

y

:

t'f*

t

^
Common v:-k
(Woodcockv Hess, MoyerCoo Inc.; Stroud;
•
and Butcher
&.ShfnerdX 75,,000 shares,4?

.

"

Lynch, Pierce, Fenner and Smith; Paine, -Wtebber,
Jackson & Curtis;. Smith,
Barney & Co.; White, Weld &>
;• f. Co.-ead F. JSheKstadt & Co.) $9,000,000

s

1

G-L Electronics Co., Inc.

;
t,

-

(Friday)

(Metrlli:

.

*

;

'*■ /-.>

General Public Service Co

Grace Line. :Ihc.—r.-i--.

i

; •>

bidden;

Oil & Gas

Oct. 22 filed

mencement «of such

>

Probable

Lynch, Pierce, Fenner & Smith and White, Weld & Col
(jointly); Stone & Webster Securities Corp.; and Salo¬

per

■4,^4-.^

bidding.

poned.-'-—

fttoe—To be supplied
by amendment. ?Proceed»^-Fai
working capital and~ other corporate purposes. Underwriters—Joseph Mandell Co. mid Louis L. Rogers Cq%
both of .New York,, on a best
efforts basis.
:::

•

competitive

mon Bros.: & Hutzler arid0Eastman
Dillon/ Union Se¬
curities & Co. (jointly); Bids^-Had been expected to bo
received on. Sept. 15, but has been indefinitely post¬

least

l'r.~,

-

?

by

Halseyi Stuart & Co. Inc;; Ltoman Brothers; Merrffft

Corp. at the rate of one share
Union stock for each 2.409 shares of Sunrise
The offer is * subject to

stock.

■

.

'

redeem and retire $17,-000,000 principal amount of
4%^b
first mortgage bonds due 1987. Underwriter—To be de-

of Grand

Underwrtter-rTo he determinedby competitive
bidding
Probable bidders! Blytk A Co.,
Inc^ and The Fint Boaton
^Corp. (jOtatly iLKuhiuLoeb f. A- • Co.;.
Brothers, and G10re, Forgan A Co. (jointly). TTWf 1hl
been scheduled to ke received
up to 3:45 pjn. (EDT) on
vlfay 13atRoom654,161 IndianaAve., N. 'W., Washing¬
ton 25, D. CU/bat kidding lias been
postponed.v

.

Utilities Co.

.Aug. 14 ffied 417(909)900 of first mortgage bonds, serleer
A, due 1968. 'proceeds—Together with cash on hand, ta

r..;ri':\*:n

common

/.'

.

.

Gutf Gtataa

' yZ,

to be offered in
exchange for
of Sunrise
Supermarkets

Jan. 14,

writer—None.

Underwriters—.

/;

\'I

•«nd/or

Woodcock, Hess, Moyer & Co., Inc., Stroud & Co., Inc.,
and Butcher, &
.Sherrerd, all of Philadelphia, Pa., and
four other firms.

,

.

other purposes.

;*Z "

"

warrant * to

the,

company's magnetic laminations program; to discharge
short-term bank loans; and for
working capital; expan-

.

Un¬

purposes.

Guardian Insurance Corp., Baltimore, Md.
Aug. 16/4957, filed 300,000! shares of common stock, at
which 200,000 shares are to be publicly offered and the
remaining100,060 shares reserved for issuance upon •«seise cif warrants which are to be sold at 25 cents
pes

cents).

Sept. 29 fUed5Q0,0()0 shares of common stock/(par 18
cents), of which 106*000 shares are to be sold for the
account of selhngrtockhfllders.
Price—$2.25 per share.

Price—To be supplied by amend¬

Proceeds—For general corporate
derwriter—None.
•
/■•-.

Albany Ave.,

Underwriter-—None.

common

ment.

com¬

★ €14- Electronics Co.j Inc., Camden, N., 4. (14/18)i
Get.

subscription by

each four shares held.

(letter of notification) 300,900 shares of
stock (par one cent)/
Price—$1 per share."

X

<

filed 90,218 shares of capital stock

(par $5). to
stockholders5 of
record Nov. 25, 1958 at the rate of one new share toir

j

23

mon

28

be offered for

-A- Gibraltar Amusements, Ltd.

York, N. Y.

41

Underwriter—None.

Indiana

& Michigan Electric Co.
(-11/6)
Sept. 26 filed $20,000,000 of first mortgage bonds due
Nov. 1, 1988. Proceeds—To retire bank loans used for
construction program. Underwriter—To be determined
by competitive bidding. Probable bidders: Halsey, Stuart
& Co. Inc.; Eastman Dillon, Union Securities & Co.; The
First Boston Corp.; Harriman Ripley & Co. Inc. Bids—
Expected to be received up to 11 a.m. (EST) on Nov. 6.
Continued on page 42

>

The Commercial and Financial Chronicle
42

.

1958

Thursday, October 30,

•<

$11.50 to public.

Washington, D. C.
of common stock (par one
Proceeds—To develop and

Industrial Minerals Corp.,

July 24 filed 600,000 shares
cant). Price—$1 per share.

operate graphite and mica properties in Alabama.
derwriters—Dearborn & Co. and Carr-Rigdom &
both of Washington, D.

C., on a best effqrts

Industro Transistor Corp.

Un¬

Co.,

Underwriter—None.

&

Waltham, Mass.

Martin

($.1/3-7)

$U2.50 f>er -unit).
Proceeds — For completion of
La tenia plant, and for general corporate purposes.
derwriters— The Kentucky Co., Louisville, Ky.,

<

the
Un¬
and

Members "in the

18

Proceeds—To refund

$10,000,000

4%%

drilling, exploration and development of oil and
properties. Underwriter—None. Stop order proceed¬
ings instituted by SEC on Oct. 6.
Montana

—

Underwriter—To be determined by competi¬

tive bidding.

Probable bidders: Halsey, Stuart & Co.
Inc.; The First Boston Corp.; Blyth & Co., Inc.; Lehman

Brothers, Merrill Lynch, Pierce, Fenner & Smith and
BefaSholdt
Gardner (jointly); Eastman Dillon, Union
Securities & Co.; Stone & Webster Securities Corp. Bids
—Had been expected to be received up to 11 a.m. (EDT)
on Ju|y 6, but offering has been postponed indefinitely.

Montana

;

Libbey-Owens-Ford Glass Co.
Oct. 24 filed 2L858 shares

of

(common

stock

(par $10)

for sale to

employees holding series N options granted
pursuant to the -company's Employee Stock Option Plan.
Uf« Insurance Securities Corp.
Msxtih 28 filed 1,000,000 shares of capital stock (par $1).
Price—$5 per share. Proceeds—To acquire stock control

*<young, aggressive and expanding life and other in¬
companies and related companies and then to
operate such companies as subsidiaries." Underwriter—
First Maine Corp.. Portland, Me.
Oct. 28 filed £922,500 of 5%%

subordinated convertible

debenture <due Dec. T, 1970,to be offered in exchange
on the basis ©f jequal principal amounts for the out¬
standing *3% convertible subordinated income notes due
1967 of the Calidyne Co.,
Inc., a subsidiary. The com¬
pany will offer to purchase
at face -value Calidyne
notes from those stockholders who desire to sell their
notes for cash, .at a price equal to 100% of their prin¬
cipal .amount.
.

long Island Casualty Insurance Co.

Sept. 29 filed 100,000 shares of capital stock (par $2.50)
be offered for subscription
by holders of the comwW* tPKsaently .outstanding 55,975 shares.
Price—$6
per snare. Proceeds-—To beadded to capital funds. Office
aty/L. I., N. Y. Underwriter—None.
to

mingo Plaza,

-

Price—To be related to the current market

of Montana.

price on the New York Stock Exchange. Proceeds—To¬
gether with other funds, to carry on the company's con¬
struction program through
1959.
Manager-Dealers —
Smith, Barney & Co., Kidder, Peabody & Co. and Blyth
& Co., Inc. Offering—Expected this Fall.
Motion
•

Picture

Investors Inc.

July 11 filed 200,000 shares of common stock (par $1),
Price—$10.75 per share. Proceeds—For investment. Of¬
Bldg., Kansas City, Mo. Un¬

fice—1000 Power & Light
derwriter—None.

National

Beryl A Mining Corp., Estes Park, Colo.

May 16 (letter of notification) 2,916,800 shares of non¬
assessable common stock (par one cent). Price—10 cents
per share.
Proceeds—For .mining expenses. Underwriter
—Birkenmayer & Co., Denver, Colo.

stock.

(letter of notification) 50,000 shares of common
Price—At par (50 cents per share).
and procure persons to implement

To

train

the

projected plan of development

Office—1406

Pearl

St.,

Western Securities Co.,

Boulder, Colo.
Boulder, Colo.-

Proceeds—

and carry
and operation.
Underwriter-

Natural Gas

Pipeline Co. of America (11/7)
of first mortgage pipeline bonds,
1, 1978. Price—To be supplied by amendment.
Proceeds—Tx> reduce bank loans, incurred for the com¬
pany's expansion program. Underwriters—Dillon, Read
& Co. Inc. and Halsey, Stuart & Co. Inc., both of New
Oct. 16 filed $30,000,000

due Nov.

York.

Nayfor Engineering & Research Corp.

}

■

•

23, 1958,Pvhich were not held on that date
persons^who were stockholders on March 16, 1057*
"eligible' shares" iri: connection with,
offer made to stockholders in May,>1958;; (5) 29,577

record May

by

and which*were not
an

common

into

^shares

which

'

the

latter debentures are

convertible; and 25,800 common shares, to be issued to
Linden &Co. Proceeds—For general corporate purposes,
including'payments to Denver Research Institute, for
testing otf rthOjcpmpany's; process for. the production
of shale oil. .Underwriter—None. - '
-r

the

O. T. C.

Enterprises Inc.
^letter of notification) 23,200 shares of com¬
mon class B stock
(par $1). Price—$5 per share. Pro¬
ceeds—For completion of plant plans; land; construe-*
March

tiori

St.,

6

and operating-expenses. * Office—2502 N.
Baltimore 18, Md.
Underwriter—Burnett

Sparks, Md.

Calvert
& Co.,

'V

'r

—"

^ Pacific Telephone & Telegraph Co. (1J/J8)
Oct. 24 filed $80,000,000 of 32-year debentures due Nov.
1, 1990. - Proceeds — To repay advances from American
Telephone & Telegraph Co;, the parent. Underwriter—•
To be determined by competitive bidding. Probable bid¬
ders: Halsey, Stuart & Co. Inc.; Morgan .Stanley
Bids—Expected to be received on Nov. 18.

& Co.
-

Co.

1,594,604 shares of common stock to be
subscription by holders of outstanding com¬
mon and preferred stock on the basis of one new share
for each eight common or -preferred shares held.
Price
Oct.

filed

24

offered for

Proceeds—To repay advances
Telephone & Telegraph Co. Underwriter

—Af par ($100 per share).
from American

Control—Of the 832,000 shares of

—None.

stock (par $100)

6% preferred

stock

and 11,936,835 shares of common

(par $100) outstanding as of Oct: 24, 1958, there were
owned by the American Telephone & Telegraph Co. 648,957
•

preferred shares and 10,790,943 common

shares.

Panama

(Republic of) v Oct. 9 filed $16,700,000 of external secured bonds of 1-958
to mature April i; 1988.
Price — To be supplied by
amendment.
Proceeds — To retire certain outstanding
debt and for Panama's feeder road program.
Under¬
writer—Lehman

Brothers,' New York.

porarily postponed;

-

-

r.

i'.

Inc., Pasadena, Calif.

writer—Investors

-

stock "(par $1).

investment. Under¬
Investments Corp., Pasadena, 'Calif.

market.

Price—At

Offering—Tem¬

:•

May 19 filed 20,800 shares of common
Proceeds—For

PeninSiiUir Metal Products Corp.
(leftel of notification) 10,000 shares of common
(par $l)r Price—At market (not to exceed an ag¬
gregate of $100,008). Proceeds—To a selling stockholder.
Office—1365 Jarvis, Ferndale, Mich. Underwriter—Wjn.
C. Roney & Co., Detroit, Mich.
;

Oct." 6
stock

Pen n-Texas

.Corp.
1,488,438 shares of common stock (par
$1) being offered for subscription by common stockhold¬
ers at the rate of one new share for each three shares
held as of Oct. 15,1958; rights to expire on Oct. 31, 1958.
Sept.

25

filed

Pricp—$5

At par

banks, Morse

Robert

per

H.

from
Fair¬
& Co.; Underwriter—Bear, Steams & Co.,

share. Proceeds—To be used to buy
Morse, Sr., 297,231 common shares of

Sept. 29 (letter of notification) 300,000 shares of cumu¬
lative voting and non-assessable common stock. Price—

($1 per share). Proceeds—For organizational ex¬

11 Fla-;

dencirig 1;' options'/to1 purchase common shares, • which,
warrants^arfe'-^CfCisahle'' at 88Hcents per share (esti¬
mated
prodecds,^ $522.650) ;- ' (2) •' 297,17T"shares, to; be
offered to* 'holder^ Of ^outstanding
S1/* % convertible'
*'debenture!"'" dtifeI OCt. 3l/ 1964 at the; conversion price of
66% cents/jcM^r Share' (ho cash proceeds to the company) ;x
(3 > 351*363 '-common shares, issuable - upon- Conversion
of outstanding 4/2% convertible debentures at the con¬
version "price of'$2 per share (no cash proceeds to the
company); (4) $59,155; of -4%% convertible debentures
to be'offered' to ^certain"stockholders of the'company of

Peckman Plan Fund,

National Educators Finance Corp.
June 4

Hialeab,

l^iale^h; Fla.

* Pacific Telephone & Telegraph

July 1 filed 100,000 shares of common stock (no par)
stock will be offered only to bona fide residents

out

ilieg dlectronics, Inc.

Power Go.

The

of

surance

Power Co.

July 1 filed $20,000,000 of first mortgage bonds due 1988.
Prbceeds
Together with other funds, to be used to
repay $15,500,000 in batik loans and tq
carry on the
company's construction program through 1959. Under¬
writer—To be determined by competitive bidding. Prob¬
able bidders: Halsey, Stuart & Co. Inc.; Lehman Bros.;
Merrill Lynch, Pierce, Fenner & Smith, and Stone &
Webster Securities Corp. (jointly); White, Weld & Co.;
Eastman Dillon, Union Securities & Co.; Kidder Peabody & Co., Smith, Barney & Co. and Blyth & Co., Inc.
(jointly). Bids—Had been expected to be received up
to noon (EDT) on Aug. 26 at Room 2033, Two Rector St.,
New York, N. Y., but company on Aug. 22 again decided
to defer sale pending improvement in market conditions.

bonds due

efforts basis.

Lake City, Utah

gas

first mortgage bonds

Laughtin Alloy Steel Co., Inc.
Aug. 28 filed $500,000 of 6% subordinated callable de¬
bentures due June 30,1968, and 150,000 shares of common
stock (par 10 cents) to be offered in units of $100 of
debentures and 30 common shares.-Price—-$100 per unit.
Paaoeeds—Together with a $175,000 mortgage loan from
the American Brake Shoe Co., will be used to meet ex¬
penditures in acquiring latter .company's South San
Francisco foundry and for working capital. Offices—Las
Vegas, Nev,, and .South San Francisco, Calif. Underwriter
—-Sam Watson -Co., Inc., Little Rock, Ark., on a best

;

—For

*.

of first mortgage

j

;

'

working1 capital."* Office—11.' Flamingo Plaza,
Underwriter— Henry & Associates, Inc.,

-X

—

Minerals Consolidated, Inc., Salt

Laclode Gas Co.

June

I1

Fla.

i

Aug. 29 filed 1,000,000 units, each consisting of one share
of common stock (par 10 cents) and two warrants to pur¬
chase one common share. Price—$1 per unit: Proceeds

^keystone Custodian Funds, Inc.
Oct. 27 filed <by amendment) an additional 1,000,000
shares of Keystone Custodian Fund Certificates of Participation, series K-l (par $1). Price—At 'market. Pro¬

1063.

Underwriter—None.

Underwriter—None.

Land Co., Kern County
Gunal A Water Co., Victoria Land & Cattle Co. and
Bequillas Cattle Co.

-

Francisco, Calif.

San

(letter of notification) 159,395 shares of common
stock (par 25 cents) to be offered for subscription by
stockholders of record Oet./15, 1958 on the basis of one
new share
for each five shares held; rights to expire
Dec. 15, 1958.
Unsubscribed shares may be offered to
one or more persons selected by the board of directors.
Price—$1.40 per share. Proceeds—To reduce bank loan;
to increase working capital and for general corporate
purposes. Office—617 W. 7th Street, Los Angeles,'Calif.

County

-■

*A ;

-

ic Oil Shale Corp., Beverly Hills, Calif.

Merchants Petroleum Co.

iKg «hares which may be purchased under the plan.
Memberships in the plan are to be offered to eligible

ceeds—For investment.

■/"' Oak Ridge, lnc.

Oct. 8

company's Employee Investment and Profit-Sharing
Pfem, together with 4,000 ahares of common stock, being
the estimated maximum number of presently outstand-

Kern

Proceeds—For "investment;

ket.

Baltimore, Md.

—

Scherck, Richler XJo., St. Xouis, Mo.
of Interests Of

' *

it Northeast Investors Trust, Boston, Mass.
Oct. 27 filed
(by amendment) an additional 100,000
shares of beneficial interest (par $1). Price — At mar¬

'C
Sept. 4 (letter-of notification) 100,000 shares of common
stock (par '$f)V Price — $3 per share. Proceeds — For

St.,

^kwn ^ounty land Co.
24 filed £100,000

Co.,

—

★ Mercantile Acceptance Corp.
Oct. 14 (letter of notification) $29,000 of 12-year 5%%
capital debentures. Price—90% of lace amount: Pro¬
ceeds
For working capital.
Office — 333 Montgomery

Rd„

(S otf which will not be separately transferable from the
io twhich they pertain -prior to Dec. 1, 1959). Price
—To be supplied by amendment (reported to be about

due 1982.

New York 38; N. Y. Underwriter
Co., Inc., New York 5, N. Y. :
'
way,

sinking fund debentures, due
July 1, 1978. Proceeds — Working capital and general
corporate purposes. Price—To be supplied by amend¬
ment. Underwriter—Smith, Barney & Co., N. Y. Offer¬
ing, which was expected on July 2, has been postponed.
Issue to remain in registration.

bonds

filed

Fund, Inc., St. Paul, Minn.

Broad-1
Greenfield

administrative expenses./Office—150

corporate

June 11 filed $25,000,000 of

Sept 26 filed $2^300,000 of 6% first mortgage bonds due
1978, and 230,000 shares -of common stock (par $1) to be
offered in limits ©f $100 of bonds and 10 common shares

euoptayees of

For

Heller

E.

Mairs & Power

Underwriter—None.

Jockey Club, Inc.

notification) 300,000 shares of common'
(par 10 cents). Price—$1 per share. Proceeds—
acquisition of additional gas and oil interests and'

Price—$5
Proceeds—To reduce current indebtedness to
& Co.
Underwriter—Plymouth Bond
Share Corp., Miami, Fla.
V
'
share.

National Bank Bldg., St. Paul, Minn.

plant site. Office—1605 Trapelo

and Reillv, Hoffman &
%
r

Exploration Co.

Northwest Gas & Oil

Aug. 6 filed 40,000 shares of common stock. Price—At
market.
Proceeds—For investment.
Office—1002 First

Sept. 15 (letter of notification) 9,340 shares of common
stock (par $1) to be offered for subscription by common
stockholders on basis of one share for each 12 shares
held. Unsubscribed shares to be sold to certain stock¬
holders. The offering will be made sometime in October.
ptf©e_$30 per share. Proceeds — For working capital

Underwriters

N. Y.

York,

New

St.,

Aug. 22 (letter of

Walter

Underwriter—None.

and acquisition of a

42nd

E.

stock

per

Jtek Corp.

Oct.

-

Inc., Miami, Fla.
Oct. 6 filed 100,000 shares of common stock.

Investment Corp. of Florida
Oct. 9 (letter of notification) 55,555 shares of common
stock (par two cents). Price—$4.50 per share. Proceeds
—For capital account and paid-in surplus.
Office—At¬
lantic Federal Building, 1750 E. Sunrise Boulevard, Ft.

• KautugKy

unit;
—122

Pearson, Murphy & Co., Inc.
Co., Inc., both of New York.

M. C. A. Credit Co.,

■r

Lauderdale, Fla.

Price—$1

share. Proceeds — For the acquisition of properties
option and for various geological expenses, test
drilling, purchase of equipment, and other similar pur¬
poses.
Offices—Wilmington, Del,, and Emporium, Pa.
under

(N. Y.)

of com¬
Proceeds
complete a two - way telecommunication mobile
for test equioment and for working capital. Office

—To

per

150,000 shares of common

filed

^ Northeast Telecommunications, Inc.
(Jet. 20
(letter ol notification) 300,000 shares
stock (par 10 cents). Price—$1 per share.

mon

Sept. 29 filed 350,000 shares of common stock.

basis.

Houston,
Co., Inc*

Houston, Tex.

Mining Corp.

LuHoc

stock (par 10
cents). Price—To be related to the market price. Pro¬
ceeds—For working capital and to enlarge research and
development department. Underwriter — S. D. Fuller A
Co., New York. Offering—Being held in abeyance.
ffeb. 28

working capital. Office—931 San Jacinto Bldg.,
Tex. Underwriter—T. J. Campbell Investment

share to stockholders;
Proceeds—$328,300 to redeem outstand¬
ing 5% sinking fund debentures and $189,200 to reduce
short term bank loans. Office—Los Angeles, Calif. Un¬
derwriter—Quincy Cass Associates, Los Angeles, Calif.
fund debentures. Price—$10.50 per

41

Continued from page

i

.

.

(1C06)

MfMO shares of capital stock, to be offered

suhpenptioa by holders ©f outstanding stock, on a
rate basis. Any shares not so gold will bo offered on
ap^atichaage basis to holders of outstanding 5% sinking
PIP




New York.

writer—Waldren &

2s*'
for

penses and first three months'
fice—1250 Wilshire Blvd., Los

Aug. 1 filed $8,000,000 of first mortgage bonds due 1988.
Proceeds—Td redeem a like amount of 5% first mort¬

operational expenses. Of¬
Angeles 17, Calif. Under¬
Co., San Francisco 4, Calif.

Nadow Oil Tool Co.

Pennsylvania Power Co.

TJnderwriter—To be determined

May 5

gage' bonds, due' 1987.

stock (par one cent).

by competitive bidding. Probable bidders: Halsey,
& Co. Inc.; Kidder, Peabody & Co.; White Weld

pay

(letter of notification) 150,000 shares of common
Price—$2 per share. Proceeds—To
loan; to acquire fishing tools for leasing; and for

Stuart
& Co.;

Volume

188

Number

5790

.

The Commercial and Financial Chronicle

.

.

Equitable Securities Corp., and Shields & Co. (jointly):
Lehman, Brothers, Eastman Dillon; Union-, Securities &

Co., Salomon -Bros. & Hutzler and- Ladenburg, Thalmann
& Co. (jointly); Merrill
Lynch, Pierce, Fenner & Smith
and Dean Witter & Co. (jointly).
Bids — Tentatively
had been expected to, be received up to 11 a.m.
(EDT,
on Aug! 27 but
company on Aug. 22 decided to defei
sale pending improvement in market

conditions,,~A

■

★ Perkin-Elmer Corp.
?v
AA:1 V< •A'-"
Oct. 22 (letter of notification) 8,115 shares Of common
stock (par SI) to be offered to
employees pursuant to
Employee Stock Purchase Plan; Through'payrdfLtieduc- '
lions// Price—$20.19 per share. Proceeds—For
working
capital.h:Office
■

Main

—

Ave.,

wrder—None.A.

A?

Norwalk,. Conn.

Plainview Country Club, Ine.
(10/31-11/4)
Sept. 29 (letter of notification) 300,000 sharespf common
stock (par 10 cents);-Price—$1
per share. Proceeds—To
acquire land and for construction of swimming

pools and

lockers and other uses.
Office—Plainview, Long Island.
New York. Underwriter—Sano &
Co., New York, N. Y.
de Leon

Trotting Association, Inc.
Aug. 7 filed 400,000 shares of common Stock (par ont
cent)
Price—$1.50 per share. Proceeds—To pay current
liabilities; for new construction and working capital
Office—Bayard,, Fla.* Underwriter—-Robert L. Fermar.
Co., Inc., Miami, Fla.
^
-A.

>

Prairie-Fibreboard Ltd.-.

// A;^A/Ao ^

Aug. 18 filed 209,993 shares "of

purpose.
Office ^Saskatoon, Saskatchewan
Underwriter-^Allied Securities Ltd., and United

Securities, Ltd., both of Saskatoon, Cariada.

.

/

*

• Preferred Risk Life Insurance Co.
Sept. 8 filed 250,000 shares of common stock (par $1)
Price—$4 per share. Proceeds—To increase capital and
surplus.
Office—Colorado Springs, ; Colo. Underwriter
,

,

—None.

•.•'•"V?• A

,

'

Financial Corp.
;
: '
i'
7'7 A
June 26 filed $1,000,000 of
15-year 6% series A sinking
fund debentures due 1973, to be offered in denominations
of $500 and $1,000. Price—At
work

'■'•

fng capital and general corporate purposes. Underwriter
Israel Corp.. New York, on a "best efforts

—Rassco

Offering—Expected late this

Relur

year.

Corp.

Octi 16 (letter of notification) 150,000 shares of common
(par five cents). Price — $2 pef sare. Proceeds —
For inventories and
working capital. Office—1007 South,
21st Avenue, Hollywood. Fla. UnderwriterAName to be

'stock

supplied by amendment.

shares and

1,

terms

the

of

amendment).
bentures

are

stock

common

be

supplied by amendment.
Proceeds—For
working capital. Underwriter
Citrus Securities Co r
Orlando,.FlaJ'. ;V. *;
v*
*
—

"

Reynolds Engineering & Supply, lncv
Aug. 22 (letter of notification) 60,000 shares of commoi
stpek (par $1). Price — $5 per share. Proceeds
Foj
working capital. Office—2118 N- Charles St., Baltimore
18, Md. Underwriter—L. L. Bost Co.. Baltimore, Md '
Petroleum

Ltd.,

Alberta,

June 26 filed 1,998,716 shares of

Canada ;

: '"

stock (par $1/
to be sold .on behalf o1

common

Of this stock, 1,174,716 sharew are

the company and 824,000 shares for the account of

cei

tain

selling stockholders- The company proposes to offc
the 1,174,716 shares for subscription by its shareholder?
the

rate of

(with

an

one

new

share for each

oversubscription

three shares helc

privilege).

The subscriptio;

period -will be for 30 days following issuance

of sub¬

scription rights. Price—To be supplied by amendment
Proceeds—To pay off demand note, to pay other, indebt¬
edness, and the balance if any will be added to working
capital. - Underwriter — Pacific Securities Ltd.; Van¬
couver,

Canada.

*

A

.

■—To

stock.

repay

Colo.

cipal amount.

Price—At

par

($1

share).

per

a*

★ Ross Mortgage & Investment Co., Inc;
Oct. 16 (letter of notification) $218,525 repurchase guar¬
antee agreements with mortgage or deed
of trust notes.
Proceeds—For general funds of the
company to be used
for continued purchase
and sale of real estate and
deed

St.,

of

N.

trust

W.,

A""/

\

notes.

Office—Investment

Washingtoii,/D.fC... Under¬
' * ' '
,,\A7* 'A
'
;

Routb Robbins Investment Corp. 7A.
Seph 22 filed $1,000,000 of 10-year 6% cumulative

con¬

vertible debentures and. 99,998 shares of common stock
Price—Of debentures, at par (in units of $100
each)
and of

and

stock, $1 per share. Proceeds — For investments
working capital. Office—Alexandria, Va. Under¬

writer—None.

*

.

' *

~

A

*
Rural Telephone Co., Knox, Pa..
Sept. 29 (letter of notification) 3,000 shares of

common

(par ; $10) to be- offered to stockholders on the
basis of one new share for each three shares held; rights
will expire on Oct. 31, 1958. Price—$20 per share. Pro¬
ceeds—For installation, construction and.
working cap¬
Underwriter—None.

-Scientific-Atlanta, 7lncA ■
:
^
"
jSept. 11 (letter of notification) 6,500 shares of common
stock

1967

(the

supplied

of the

by
de¬

new

Tishman Realty & Construction Co., Inc.

to

—

For

at

general

(11/10-14)
Oct.

Hotel

presently
(par $1). Price

100,000

outstanding shares of
To be supplied by
selling stockholders. Under¬
writer—Kuhn, Loeb & Co., New York.
'A
stock

—

Proceeds—To

..

Trans Caribbean

Airways, Inc. (N. Y.)
Oct. 6 filed $1,100,000 of 5%% convertible subordinated
debentures, due Oct. 1, 1968. Price—100% of pirncjpal

best efforts basis.

a

Co.

filed

17

common

amendment.

100%: of prin¬
corporate pur¬

Proceeds—To be added to the general funds of

amount.
,

the company to replenish working capital expended ih

Aug. 19 (letter of notification) $250,000 of 6% convertible
debentures due Sept. 15, 1963 to be offered for
subscrip¬
tion by common stockholders on a
pro rata basis. Price—

the

Underwriter—None.

acquisition bf aircraft.

•

•
Shop Rite Foods, Inc., Albuquerque, N. Mex.
Sept. 25 filed 35,383 shares of common stock (par $5)
being offered for subscription by stockholders at the rate

+ Trice Oil & Gas Co., Longview, Texas
Oct. 24 filed $4,400,000 of Participations in the com¬
pany's 1959 Oil & Gas Exploration Programs 5901,15902,
5903 and 5904, to be offered in minimum units of $5,000:
Proceeds—To be used for acquisition and exploration
of undeveloped oil and gas properties.
Underwriter^

of

None.

At par. Proceeds—For
working capital. Office — 3172
North Sheridan Rd., Chicago
14, 111. Underwriter—None

one new

share for each four shares held of record Oct.

21, 1958, rights to expire

on

Nov. 10.

Price—$11,50

Proceeds—For equipment, merchandise suid^gen¬
Underwriters—First Southwest
Co., Dallas, Texas; and Miner, Mee & Co., Albuquerque,
' '

.

,

.

.

'

.'.

A

"

Newark, N. J.
Aug. 1 filed $1,600,000 of 5% debentures due 1973, 4,000
shares of 6% preferred stock
(par $100) and;48,000
shares of common stock (par $1) to be offered In unite

share.

New Mexico.

"

Triton Corp.,

per

.

of

$8,000.,pf debentures, 20 shares of preferred stock and;
shares of common stock.
Price—$10,240 per unit.
acquire, own and operate interests in pro¬
ducing oil and gas properties.. Underwriter—Nohe. Off
fice—11 Commerce Street, Newark, N. J.
Timothy H.
240

Simplicity Pattern Co. Inc., N. Y.
Aug. 15 filed 42,500 shares of common stock (par $1)
Price—At the market or at a- price within a
range not
less than the bid price and not
higher than the asking
price quoted, on the New York Stock Exchange at the

Proceeds—To

Tungsten Mountain Mining Co.
Aug. 11 (letter of notification) 100,000 shares o£ com¬
mon stock (par $1).
Price—$1.50 per share. Proceeds—
To extinguish present indebtedness, increase reserve for
contingencies and working capital. Office—511 Securi¬
ties Bldg., Seattle 1, Wash.
Underwriter—H. P. Pratt
& Co., 807 SQge Bl^, Seattle 4, Whsh'.A
A
'"A'

time

offering.
time

to

foregoing

(par 50 cents) being offered for subscription by
stockholders of record Sept. 10, 1958 on the

common




The shares will also be offered from

such Exchange at a price within the
Proceeds—To go to Joseph M. Shapiro,
stockholder. Underwriter — Lee Higginson
on

range.

the, selling

Corp. New York. Offering—Indefinitely postponed.
State

stock

Life, Health A Accident Insurance Co.
(letter of notification) 50,000 shares of common
(par $1). Price—$5 per share. Proceeds—To be

invested

in

stocks and bonds and to acquire other life
insurance companies. Address—P. O. Box 678, Gulfport,
Miss.

Underwriter—Gates, Carter & Co., Gulfport, Mis*

★ State Loan & Finance Corp., Washington,
...
(11/18)
...

p. C.

Dunn is

President.

A

Union Finance Corp., Tampa,

A

f

Fla.

Sept. 26 filed $500,000 of 6% 20-year sinking fynd con*
vertible capital debentures due Oct. 15, 1978, Price —
Proceeds—To be added to the

100% and accrued interest.

general funds of the company and initially used to re¬
bank

duce

loans

and

short

term

Underwriter—

notes.

.

Oct.

27

filed

$10,000,000

debentures due

chase class A

of sinking

fund

subordinated

1978, with 1958 series warrants to

common

stock.

pur¬

Price—To be supplied by

amendment., Proceeds—To redeem and

retire

all of the

outstanding 5%

10-year sinking fund subordinated de¬
bentures, due April 1, 1960. and all of the outstanding
5% seven-year sinking fund subordinated debentures,
due. April 1,1960; the balance will be added to the com¬

pany's general funds to
and

short-term

notes

of

be used to
the

reduce bank

company.

loans

Underwriters—

Johnston, Lemon & Co., Washington, D. C.; and East¬
man Dillon, Union Securities &
Co., New York.
;

Strategic Minerals Corp. of America, Dallas, Tex
$2,000,000 of first lien mortgage 6% bond
975,000 shares of common stock (par 10 cents). Prim
—For bonds, 95% of princmal amount; and for stock $?

March 31 filed
and

share.

Proceeds—To erect and operate one or mort

Soul h west

Shares, Inc.. Austin, Texas.

Super Food Services, Inc., Chicago, III.
Oct. 28 filed 110,000 shares of preferred stock, first series,
and 110,000
warrants/ first series, to purchase a like
number of common shares to be offered in units of one
preferred share and
able

at

one

warrant (warrants are exercis¬

$2.50 per common share).

Beil &

Hough, Inc., St. Petersburg, Fla.
pected this week.
•

Price—$20 per unit.

Sept.

purchase 6,347

common shares to holders of class A cap¬
stock, if converted to common shares on or before
purchase 6,000 shares are
being given to Central Illinois Securities Corp., which
has subscribed to 25,000 of the units being offered. A
total of 42,356 common shares are being offered to class
A
capital shareholders in exchange for said class A
shares on a share for share basis.]
•

Tertnoy Engineering, Inc., New York (11/3)
25,000 shares of common stock (par 10 cents)
and $500,000 of 6% convertible subordinated debentures
due Nov. 1, 1968. Price—To be supplied by amendment.
Proceeds — To retire outstanding bank loans, to cancel
notes and for general corporate purposes. Underwriter
—Milton D. Blauner & Co., Inc., New York.
Thomas Paint Products Co.

May 26 (letter of notification) 1,250 shares of common
stock (par $10) and $37,500 of 6% serial subordinated
series

1958, to be offered in units of

one

share of stock and $50 principal amount of debentures
to be offered to stockholders on the basis of one unft for

30,000

shares

6%

of

price of outstanding preferred stock and for expansion
Office — Room 938, Merchandise
Mart, Chicago 54, 111, Underwriter — Eastman; Dillon,
Union Securities & Co., Inc., Chicago, 111.
OfferingExpected this week.
■
,

,

United

Employees Insurance Co.
April 16 filed 2,000,000 shares of common stock (par $5)«
Price — $10 per share. Proceeds — For acquisition efl
operating properties, real and/or personal, including
office furniture, fixtures, equipment and office space, faf
lease or purchase.
Office — Wilmington, Del. Unas*writer—None.
Myrl L. McKee of Portland, Ore., I«
President.

Oct.

24

A-

r

Merchants

&

Manufacturers,

Inc.,

York

New

filed

$500,000

of

interests

in

the

company's

Employees Stock Purchase Plan for 1959, together with

said
The registration statement also includes an addi¬
119,335 common shares, which may be optioned

75,000 common shares which may be issued under

plan.
tional

stricted

Dec. 31, 1958; and warrants to

of notification)

and working capital.

111.

debentures

(letter

26

or

ital

A.'"

cumulative convertible preferred stock, 1958 series. Price
—At par ($10 per share). Proceeds—To pay redemption

Proceeds—To purchase outstanding shares of F. N. John¬
son Co.
Underwriter—W. H. Tegtmeyer & Co., Chicago,

[In addition, the company is offering warrants to

Offering—Ex¬

United Cities Gas Co.

it United

Oct. 2 filed

stock

ital;

Proceeds

Sheridan-Belmont

Proceed*

outstanding indebtedness. Office—Littleton
B.
Ford Co.,
Windover Road

Bldg., 1511 K.
writer—None.'"

offered

be

due March

poses, including the financing of the cost of any acquisi¬
tions and new construction. Underwriter—Sheraton Se¬

per

Underwriter—R.

and

$4,000,000 in exchange

chemical .processing plants using the Bruce - Williami
Process to beneficiate manganese ores.
Underwriter-

Memphis, Tenn.

mortgage

additional

offers will be offered for public sale

.

Rocky Mountain Quarter Racing Association
Oct; 31, 1957 (letter of notification) 300,000 shares
common

be

■

>

Tip Top Oil & Gas Co., Salt Lake City, Utah
)
\pril 15 filed 220,000 shares of common stock, of which
iOO,000 shares are to be publicly offered. Price—$5
per/
»hare
Proceeds—To drill two new. wells and for general''
•orporate purposes.
Underwriter — Andersen-Randolph
& Co., Inc., Salt Lake City, Utah

offering

—

at

of notification \ 27,272 shares of 70-cenl
preferred stock (par $5) and 27,272 sharea
of common stock (par 10 cents) to be offered in unite
jf one share to each class of stock
Price—$11 per unit
Proceeds —For working capital
Office — 111 E. Main
St.; Morristown, Tenn. Underwriter—Valley Securities
^orp., Morristown, Tenn

proposes to offer $8,exchange for outstanding

in

exchange offers are to
An additional, $1,009,000
to

'A7' "A

March 25 (letter

company employees "at
price equal to 95% of principal amount.
The remaining $12,000,000 of
debentures, plus any part
of the $12,000,000 hot taken
pursuant to the exchange
an

.

Corp., Orlando, Fla. y
Sept. 22 filed 100,000 shares of class-A

Richwelf

an

Underwriter—

Ga

;'

cumulative

company

debentures

outstanding 434% convertible debentures
1967, and 5% ^debentures..due March 1,

July 9

Remo

Price—To

for

W., Atlanta

A

Timeplan Finance Corp.

★ Sheraton Corp. of America
^
$26,500,000 of 7V2% capital income sinking
The

St., S

None.

Oct. 24 filed

debentures.

Whitehall

543

•

Insurance Co.

Worth, Tex: Underwriter—Kay & Co., Inc., Hous¬
/
7A
"■

fund

ars

time of

Proceeds—-For

par.

•

Fort

ton,

(500 of the shares

owned

being offered to the Presideni oi the company). Price—
$60 per unit. Proceeds—For working capital. Office—

eral corporate purposes;

Rassco

basis.

each two shares of stock

Sept. 26 (letter of notification) 3,567 shares of common
stock (par $1). Price—$18.75
per share.
Proceeds—To
go to a selling stockholder; Office—400 W.
Vickery Blvd.,

common

residents of the United States "only in the State of
North
Dakota."" Price —$3 per share.
Proceeds — For con¬

Canada.

Ga. Underwriter—None.

Service Life

curities Corp., Boston, Mass, on

7A

stock (par $1.50;
to be offered for sale to residents of Canada in the Prov¬
inces of Manitoba, Saskatchewan and Alberta and tc

struction

Atlanta 9,

common

•

Ponce

basis of one new share for each 20 shares
held; rights tc
expire Nov:14y'1958V " Price—$5 per share. Proceeds—
For working capital. Office—2162 Piedmont
Road, N. E.t

000.000 of the

A',•••■■ 7'

A\.

■

Under-

(1807)7

are

fore

available for purchase on options issued hereto¬

under

the

company's'

Executive

Employees

Re¬

Stock Option Plan.

United Security Life & Accident Insurance Ce.

Aug. 22 filed 120,000 shares of class A common stock.
Price—$3 per share. Proceeds—To provide the reserves
required to be held in life and accident insurance poli¬
cies, and to pay the necessary expenses in producing
insurance.
Edmond M.

Office—Louisville, Ky.
Smith, is President.

Underwriter—None.

it U. S. Polymeric Chemicals, Inc. (11/4)
(letter of notification) 26,285 shares of common
stock (par 50 cents) to be offered for subscription fey
stockholders of record Nov. 3, 1958 on the basis of four
new shares for each 13 shares held; rights will expire
on Nov. 24, 1958.
Price—$11 per share. Proceed*—For
equipment, bank loan and for working capital, OffioO—
P. O. Box 546, Canal & Ludlow Sts., Stamford^ Conn.
Underwriter—Dominick & Dominick, New York.
Oct. 22

Uranium Corp. of America, Portland, Ore.
April 30,1957 filed 1,250,000 shares of common stock (par
16 cents). Price—To be suDDlied by amendment {«$-

Continued on tktcte

44

,

Financial Chronicle

The Commercial and

Continued jrom page

43

purposes.

Graham

:

Proceeds—For exploration

pected to be $1 per share).

Underwriter—To be named by amendment.
Albert Griswold of Portland, Ore., is Pres¬

ident.

(letter of notification) 900,000 shares of com
Price—At par (10 cents per share). Proceedt

April 11

stock.

mon

—For

Office—305 Main St., Park City

mining expenses.

Underwriter—Walter Sondrup & Co., Salt Lakr.
City, Utah.
. .T,'-" • yt'
-V:
Utah.

Y.

Co., Inc., Rochester, N.

-

Co.

Utah Power & Light

filed $20,000,000 of first mortgage
Proceeds—To redeem $15,000,000 of

26

1988.

bonds, 5*4% series due 1987, to repay

gage

bank borrowings, and the

borrowings under a bank

$4,000,000 of

balance together with further
agreement and cash generated

forward the con¬
struction program of the company and its subsidiaries
amounting to approximately $43,000,000 for the period
1958-1960. Underwriter—To be determined by competi¬
tive bidding.
Probable bidders: Halsey, Stuart & Co.
Inc.; First Boston Corp. and Blyth & Co. Inc. (jointly);
White, Weld & Co. and Stone & Webster Securities Corp.
(jointly); Salomon Brothers & Hutzler; Kidder, Peabody
& Co.; Eastman Dillon, Union Securities & Co., and
Smith, Barney & Co. (jointly). Bids—Were to have been
received in Room 2033, 2 Rector Street, New York,
N. Y., up to noon (EDT) on Sept. 9, but were postponed
on Sept. 3.
Bids will now be received on such day sub¬
sequent to Sept. 22, 1958 but not later than Nov. 25, 1958
in

as

the business will be used to carry

.

^Chicago & North Western Ry.
are
expected to be received

shall be designated by company.

Weingarten Markets Realty Co.

Sept. 19 filed $1,600,000 of 6% sinking fund debentures,
due Nov. 1, 1978, and 50,000 shares of common stock (par
$1). The offering of the common stock is subject to the
right of certain stockholders of record Oct. 20, 1958 to
subscribe on or before Oct. 30, 1958 for a total of 7,042
shares at the rate of one new share for each four shares

held."*'[Stockholders Who have right to subsfcrlbe for re¬
maining 42,958 shares have waived such right.] Price—
100% and accrued interest for debentures and $8 per
share for stock. Proceeds—To discharge bank loans and
other indebtedness, and the balance will be used for
further property acquisitions and development and other
regular

corporate

Beissner &

Underwriter — Moroney,
Offering—Made on Oct.

purposes.

Co., Houston, Texas.

(11/25)
by the

25

Nov.

on

for the purchase from it of $1,875,000 addi¬
tional equipment trust certificates to mature in 15 equal
annual instalments.
Probable bidders: Halsey, Stuart
Co.

Inc.; Salomon Bros. & Hutzler.

Aug. 25 it was reported that the company may issue and
$25,000,000 of preferred stock. Underwriters—May
be The First Boston Corp. and Glore Forgan & Co., both
of New York. Offering—Expected late in 1958 or during
the first three months of 1959.

(Kingdom of)

Sept. 2 it was reported that an issue of between $20,000000 to $30,000,000 may possibly be placed on the Ameri¬

Underwriter—Kuhn, Loeb & Co.,

market this year.

can

Equitable Gas Co.
July 18 it was announced that the company expects later
in the year to issue and sell additional securities, prob¬
ably preferred stock, to secure approximately $5,000,000
of additional funds. Proceeds—Together with $7,000,000
from private sale of 4Vz% bonds, to repay short-term
bank loans and for construction program. Underwriter!
—May be The First Boston Corp.; Kidder, Peabody &
Co.; Merrill Lynch, Pierce, Fenner & Smith; and White,
Weld & Co., all of New York.
First City

Sept.

19

National Bank
announced Bank plans to offer to its

it was

stockholders of record Oct. 2, 1958 the right to
for 125,000 additional shares of capital stock

subscribe
(par $20)

Carolina

Western

Telephone Co.

89,391 shares of common stock being of¬
fered for subscription by holders of outstanding com¬

June

mon

6 filed

stock at the rate of

held

chares

one

new

share for each three

26; rights to expire on Oct. 31.
Price
At par ($5 per share). Proceeds — To be ap¬
plied to the payment of $700,000 of short-term bank
loans incurred in carrying forward the company's con¬
on

Sept.

—

struction and conversion program.
Statement effective Sept. 26.

■'

Underwriter—None

.

.

_

.

Wilier Color Television

System, Inc.
April 2 (letter of notification) 72,035 shares of common
stock (par $1) of which 10,000 are to be offered to stock*
holders at $2 per share and the remaining 62,035 sharei
•re to be publicly offered at $3 each.
Proceeds *— For

fin era 1 corporate Underwriter
purposes. Office—151 Adell Avenue^
onkers, N. Y.
Edwin Jefferson, 39
-—

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

10 shares held.

the basis of one new share for each

Oct.

it

27

Dec,; 2 to
additional

was

announced

approve

a

plan

stock

common

$27

stockholders

to

will

290,000

offer

vote

shares

on

of

(par $10) to stockholders of

Dec.

per

Fort

Worth, Texas.

Price—$375 per common share and $1,000
debenture. Proceeds — To develop property and

per

build certain facilities.

Underwriter—None.

Bahamas.

(11/18)

yt General Public Service Corp.
Oct.

28

directors

the

Acme

Steel

approved

a

proposal

file

to

may

Son, Louisville, Ky.

•

by a bank) on a more perma¬

be done through

equity or con¬

Office—75 Pitts St., Bos¬

''',■

Lorillard

-

-

■

' •": ■;v; 'v ■;

Co.

(P.)

Sept. 17 company announced it plans to-

offer its stock¬

subscribe for approximately 363,000
additional shares of common stock on the basis of one
new share for each eight shares held.
Proceeds — For

holders the right to

corporate purposes. Underwriters— Lehman
Smith, Barney & Co., both of New York.
Registration—Expected about Nov. 5.'

general

Brothers and

/

Master Fund,

Jan. 27 it

Inc., Fairfield, Catif.

announced this newly organized invest¬

was

nlans to offer to bona fide residents of

ment company

capital stock (par $1). Price

California 10,081 shares of

•

a

Grace Line

(10/31)

Inc.

Pierce, Fenner & Smith; Pane, Webber, Jackson & Cur¬
tis; Smith Barney & Co.; White, Weld & Co., and F.
Eberstadt & Co., all of New York.
Great Atlantic A Pacific Tea Co.
Feb. 19 It Was reported a secondary

offering of common

voting stock is expected this year. Underwriters — May
include: Blyth & Co., Inc.; Lehman Brothers and Smith,
Barney & Co.
•• •>

were

by

to vote

an

on

Proceeds—For investment.

pire

additional

for

expansion purposes.
Webster Securities Corp., New

equipment

for

trust

<

^

"

8&%.
:*•

'

Nov. 10. Price—$41 per share.
capital and surplus.

Proceeds—To in¬

plans to sell $40,000,000 of
Proceeds—To redeem a like amount
4%% debentures due November, 1992. Underwriter
—To be determined by competitive bidding.
Probable
bidders: Halsey, Stuart & Co. Inc.; Morgan Stanley &

of

Bids—Had

Co.

been

tentatively

the

pone

on

to

be

re¬

Sept. 16, but on Aug.

conditions.

4

'•*'

:

;

Inc.

announced it plans to issue on or
$3,200,000 of first preferred mort¬
gage bonds.
May be placed privately. Proceeds — To
repay bank loans and for working capital.
Midwestern Gas Transmission Co.
March 24 it was announced that this subsidiary of
Tennessee Gas Transmission Co. has applied to the Fed¬
eral Power Commission for permission to issue firstmortgage bonds, unsecured notes and 'common'Stock.
;
Proceeds—To build pipe line system- to cost about $111,000,000. •••;• Underwriters — Stone & Webster Securities
Corp. and White Weld & Co., both of New York.

/

28, company
before Dec. 31, 1958

Montana-Dakota IWIHify: Co.
was announced the company plans to issue

,

March 24 it

12,285

shares

of

and

Underwriter
York.

—

purchase

sell

an

amount hf Vfirst

undetermined

mortgage

(about $10,000,000) in the latter part of this year
or
in early 1959. Proceeds — To repay bank .loans.
Underwriter^—To be determined by competilivebidding.
Probable bidders: Halsey, Stuart & Co. Inc^Slyth & Co.,
bonds

tec.; Merrill Lynch, Pierce, Fenner & Smith, and Kidder,
Peabody & Co., Inc., (jointly); and Blair & Co., Inc.

Stone &

Moore-McCormack Lines, Inc.;

and
government insured bonds secured by
a first preferred ship mortgage on the liners S. S. Brasil
and S. S. Argentina. Underwriters—Kuhn, Loeb & Co.
and Lehman Brothers, both Of New York. - Offering —
Postponed because of uncertain market conditions.
'. r
March 24 it

was

announced eompany plans to issue

aril $24,000,000 of

Offering — Expected

Narda

Ultrasonics Corp., N. Y.

Sept. 8 it was reported that the company plans a regis¬
tered secondary offering of 60,000 shares of common

(11/12)

certificates

scheduled

26 it was voted to post¬
this refunding program because of present market

ceived

Heufolein, Inc. /
Aug. 25 it was reported that the company plans early
registration of 400,000 shares of common stock; of which
100,000 shares are to be sold for the account of selling
stockholders. Proceeds—For expansion. Underwriter—

12

?;

Michigan Bell Telephone Co.

due Oct. 1, 1983. Proceeds—To¬
gether with other funds, will be used to pay bank debt,

Nov.

on

crease

proposal to increase

capital stock (par $10) which would be offered for sub-,
scription by stockholders on a pro rata basis, with an
additional subscription privilege^ Stockholders will also
vote on authorizing issuance and sale of $900,000 5*4%

on

less an underwriting discount of

March

Company plans to issue $9,000,000 of government insured
bonds secured by first preferred ship mortgages on the
new
"Santa Paula."
Underwriters — Merrill Lynch,

and

;,

Midland Enterprises,

Bids will be received by the company up to noon

was announced that the
company plans addi¬
tional financing this year, in the form of common
stock,

This

ton, Mass.

York.

A-Illinois Central RR.

Co.

Underwriters—Blyth & Co., Inc.,

vertible debenture financing.

sometime in November.

March 21 it

Dec. 8.

34-year debentures.

registration statement with the SEC covering an offer
additional shares of common stock for sub¬
scription to common stockholders of record on or about
Nov. 18, 1958 on the basis of one new share for each
two shares held
(with an oversubscription privilege).
Underwriter—Stone & Webster Securities Corp., New

Glore, Forgan & Co., New York.

Prospective Offerings

on

Laboratory for Electronics, Inc.
July 3, Henry W. Harding, President, announced that
the directors are currently considering refinancing $790,000 of outstanding notes ($658,750 held by a principal

first mortgage bonds,

^ World Wide Helicopters Ltd.
Oct. 28 filed American depositary receipts for 212,158
chares of ordinary (common) stock (together with a like
number of the shares). Price—To be supplied by amend¬
ment.' Proceeds—To selling stockholders. Underwriter—
Blair & Co.,
Incorporated, New York. Office — Nassau,

expire

New York and J. J. B. Hilliard &

Aug. 12 directors approved

authorized: capital

$25)

to

Merchants Bank of New

2, 1958 on a one-for-eight basis.
Price—
share. Proceeds—To increase capital and sur¬
plus. Underwriters—Equitable Securities Corp., Dallas,
Texas, and Merrill Lynch, Pierce, Fenner & Smith,
record

Oct.

Concord Ltd.

ing of 206,446 additional shares of common stock (par
.$10) to stockholders of record about Nov. 21 on the
basis of one new share for each 10 shares, held; rights

York
-:/vV.L;
Oct. 14 stockholders approved, among other things^ an
offering of 6,000 shares of. additional capital stock (par
$12.50) to stockholders of record Oqt. 15 on the basis of
one new share for each eight shares held; rights to ex¬

Haverhill Gas ■ Co.

filed $500,000 of debentures due 1991 (non in¬
bearing) and 800 shares of common stock (par
to be offered to members of this club and of

Utilities Ce. (11/24)
reported that the company plans an offer--

^ First National Bank in Dallas, Texas (12/2)

Oct. 20 stockholders

27

Kentucky

—$10 per shar

★ Wilmington Country Club, Wilmington, DeL
terest

it was

$10,000,000 of first mortgage bonds due

Price—$40 per share. Proceeds—To increase capital and
surplus. Office—931 Main St, Houston 1, Tex.

of 2,478,264

20.

and
1988 Pro¬
ceeds—For construction program.
Underwriter—-To be
determined by competitive bidding.
Probable bidders; *
Halsey, Stuart & Co. Inc.; The First Boston Corp.; Glore,'
Forgan & Co.; Harriman Ripley & Co. Inc.; White, Weld
& Co.; Blyth & Co.. Inc.; Equitable Securities Corp
•;
14

Feb.

nent basis.

'

'

Light Co.
announced company plans to issue

Power &

Kansas

stockholder and $131,250

New York.

Co. (jointly).

& Co., and Goldman Sachs &

gan

•

sell

Denmark

Lynch, Pierce, Fenner & - Smith
(jointly); Lehman
Brothers; Eastman Dillon, Union Securities & Co. and
Securities Corp. (jointly); Glore, For¬

Oct. 27 it was

Commonwealth Edison Co.

Thursday, October 30, 1958

Stone & Webster

sell

company

on

•

*

Bids

bonds due
first mort¬

West Madi-

tificates, dated Oct. 15, 1958, to mature in 15 equal annual
instalments. Probable bidders: Halsey, Stuart & Co. Inc.;

;

shares of capitiu
Proceeds — Foi
development of oil and gas lands. Office—574 Jefferson
Ave., Rochester 11, N. Y. Underwriter—Frank P. Hunt

(10/30)

Chicago 6, 111., up to noon (CDT) on Oct. 30 for
purchase from it of $1,875,000 equipment trust cer¬

the

&

York, Inc.

Utah Oil Co. of New

May 6 (letter of notification) 300,000
atock. Price — At par ($1 per share).

June

Chicago & North Western Ry.

Bids will be received by the company at 400
sin St.,

Salomon Bros. & Hutzler.

Utah Minerals Co.

&

.

.

;<1808)

§4

from

it

maturing

of

(CST)

$2,610,000

semi-annually

5

stock (par 10 cents). Proceeds — To selling stockholder.
Business—Manufacture of ultrasonic equipment. Control
—The company is

controlled by Narda Microwave Corp.,
(may
Michael G. Kletz & Co.).

Underwriter—To be named at a later date

preferred stock, or a combination of the two, including
bank loans.
Proceeds—For expansion program, work¬

from June

N. Y.

bidders:

be Milton D. Blauner & Co. and

ing capital and inventories.

Hutzler.

Inc.

and

Austria

July 15 it
the

Underwriters—Blyth & Co.,

Merrill Lynch, Pierce. Fenner &

Smith.

(Republic of)

was announced

issuance

and sale of

that the country contemplate!

$30,000,000 bonds. Proceeds—For

electric power projects and other
improvements.

writer—May be Kuhn, Loeb & Co., New York.
tug"- Expected in October or early November.

Under¬
Offer-

Bank of New York

Oct. 21 stockholders of record that date
subscribe

were

given the

or

©f$100.par
each eight shares held. Price—$225 per share. Proceeds
---To increase capital and surplus. Underwriter—Morgan
Stanley & Uo., New York.




:

Now York State

Japan (Empire of)
Aug. 20 it was stated that an issue of between $30,000,000
and $50,000,000 of bonds may soon be publicly offered
on the American market.
Proceeds—For public works

projects, etc. Underwriter—The First Boston Corp., New
York.

Kansas Gas & Electric Co.
March 31, G.

before Nov. 14 for
30,000 shares
capital stock iri the Tatio of one new share for
on

1, 1959 to Dec. 1, 1973, inclusive. Probable
Halsey, Stuart & Co. Inc.; Salomon Bros. &

W. Evans, Chairman, announced that com¬
plans to sell some bonds originally scheduled for
mid-year. The proposed sale was subsequently deferred
pany

until late 1958 or

early 1959. Proceeds—About $8,000,000

Underwriter—To be determined
by
competitive bidding.
Probable bidders: Halsey
Stuart & Co. Inc.; Kidder, Peabody & Co., and Merrill

for construction program.

March 7 it

was

Electric and Gas Co.

announced that approximately $7,500,000

from additional financing will be

required for construc¬

expenditures for the balance of this year. The man¬
agement intends to negotiate a new line of credit with a
group of banks and expects to sell equity securities later
this year or in early 1959, depending upon prevailing
market conditions. Underwriter—For any common stock:
The First Boston Corp., New York.
tion

Norfolk & Western Ry.
Bids will be received this

(11/13)

(12/18)

Fall by the company for the

purchase from it of $11,760,000 equipment trust
cates due from l-to-15 years,

Co.

certifi¬

viz: Nov. 13, $5,310,000; and

18, $6,450,000. Probable bidders: Halsey, Stuart &
Inc., Salomon Bros. & Hutzler. - ,

Dec.

Volume 188

Number

5790

.

.

.

The Commercial and Financial Chronicle

(1809)
Northern Illinois Gas Co.
June 10 it. was announced company

will sell late this

$10,000:000 mortgage bonds but on Sept. 12 it was
stated that immediate financing will not be
necessary.
Underwriter—To be determined by competitive
bidding.'
Probable'bidders: Halsey, Stuart & Co. Inc.; First Boston
Corp.; Glore, Forgan & Co.; Blyth & Co., Inc.
year

*

Pacific Gas & Electric Co.

Oct. 20

it

sale of

announced

was

(12/2)

that

the

$50,000,000 first refunding mortgage bonds.

ceeds—To

retire

bank

loans

Underwriter—To

gram.

be

for

and

Pro¬

by

competitive
bidding. Probable bidders: Halsey, Stuart & Co. Inc.
and The First Boston Corp.
(jointly); Blyth & Co., Inc.
Bids—Expected to be received on Dec. 2.

Philadelphia Electric Co.

Oct.

21

it

be used

announced

was

bank

to

finance

that

loans.

plans

company

program and
be determined

Underwriter—To

early

21.

to repay

by

com¬

an

of

one

For

proposed

shares held.

share for: each 21

new

Proceeds—

:

/../I

-:'

share of

one

of

record

on

York, and Bank of America National Trust
& Savings Association. The Chase Manhattan
Bank will
be the fiscal agent for the credit. The
amount of the
new financing involved is in the
neighborhood of

Dec. 16.

"

1

$250,-

y-;.

000,000, The purpose is to restore government balances
which have been reduced by the
repayment of excessive

an

.,

„.

.

„

short term obligations previously incurred.

Virginian

<

common

for

stock

about Nov.

or

25,

each

1958.

10

ferred share..;

shares held

March 28 it

Oct.

it

27

that

reported

was

long-term financing.

some

interim loan

obtained

in

the company is planning
—
To replace an

* bout

Proceeds

connection with the

Wisconsin

purchase1

from Gulf States Land & Industries, and
approximately $1,200,000 of first mortgage

retire

bonds

blower

&

1960.

due

Underwriter

Weeks,, New /York.

.

May

—

'

' "

be

Aug. 26 it

Co. and Shields

Horn-

-

Office

tions.

•

197

Underwriter—None.

Auburn Ave.,
J
"

The

run

To

rests

with

the

New

York

Court (expected within two months).

preme

the

Petroleum

Research

Fund

of

State

Su¬

rities

American

debentures to be dated Dec. 1, 1958. Proceeds
Underwriter—To be deter¬
by <*>mpetitive bidding. Probable bidders: Halsey,
Stuart & Go. Inc.; Morgan Stanley & Co. Bids—Tenta¬
tively scheduled to be received on or about Dec. 9. Reg¬
istration—Expected in mid-November.
mined

announced that

a public offering of stock
will be made following reincorporation
stock split, Proceeds
—To selling stockholders.
Underwriter—Morgan Stan¬
ley & Co., New York.

was

of this company

in State of Delaware and 25-for-l

Southern Colorado Power Co.

stockholders authorized an additional 100,000
shares of preferred stock
(par $50). UnderwritersStone & Webster Securities Corp. and Paine, Webbert
9

*

Jackson & Curtis.

Valley National Bank, Phoenix, Ariz.

Oct.

'

rates

of

shares

July 10 it was announced Missouri Public Service Com¬
mission authorized the company to issue $110,000,000 of

it

28

Oct. 30

on

Southwestern Bell Telephone Co.

common

announced

was
on

banks

nized

little

been

has

will

stockholders at the

years

recog¬

a

rate of

one

vote

maturity of five to
this operation.

share for

new

seven

ries

of

Co..

and

justment of such

is

1%

as

a

Holiday Cuts Offerings

short-

Presumably the Election Day
holiday, on Tuesday, has served

whole.

about

the

at

their

to cut into the roster of

the

accepted xk of
banks which marked

charge to

members

porate
week.

for

sequence are

the privilege of borrowing. There
has not been any disposition on

.

Things

are

looking

somewhat advantage

market

the

at

moment

and

em¬

phasis appears to be on the side
of resistance for a change.
True
the

market, including U. S. Gov¬
suffers recur¬

ernment securities,

that

had

latest

Proceeds—For con¬
Underwriter—To be determined by

a

at

a

Four With Columbine

yield of around

in

adjustment
the temptation.

The

Keen

;

Treasury's Task

market

observers

are

sanguine just now
about the forthcoming Treasury
"But the big difference at this
operations than they were a fort¬
time is found in the fact that
night ago. It had been feared the
these spells are less frequent and
raising of some $3 billion of new
less severe than was the case a
money,
plus the refinancing of
brief time back.
In short, there
about
$12
billion
of
maturing
appears to be underlying demand
debts, might prove burdensome.
for securities which fit well into
institutional portfolios.
And
noted

at

the

that

market

are

time, it is
issues coming to

new

being

accorded

con¬

more

involved,

develops

it

rates

without

a

money

whimper.

Pre¬

sumably the latest move in mark¬
ing UP ceuter ! bank ; rediscount




Meanwhile

raising of the
wise

be

it

is

new

handled

felt

that

the

cash dan like¬
without

undue

strain:"The disposition now is to
look for the money managers to

one

was -

reported

DENVER, Colo.—George K.
Bluh, Lloyd Dahnke, Jack P. Dusapin and Delray O. Petersen are

Joins Thomson, McKinnon

Securities Corporation, 621 Seven¬
teenth Street.

now

■

(Special to The Financial Chronicle)

CHICAGO, Ill.-James W. Fitz¬
gerald has joined the staff of
Thomson & McKinnon, 231 South
La Salle Street. He was formerly

DENVER,

with Paul H. Davis & Co.

curities

Joins Fulton Reid

Real Busy Day

(Special to The Financial Chronicle)

Underwriting bankers and their
day

CLEVELAND, Ohio —Betty J.
Jackson has joined the staff of

seven

Fulton

had

a

busy

Reid

& .Co., Inc., Union
Building, members of
the Midwest Stock Exchange.

Commerce

the sponsoring groups, particularly

Join R. J. Le

where the issues had been worked

(Special to The Financial Chronicle)

up

via

negotiation

company

between

and its bankers.

the

'■

Vesque

BEVERLY HILLS, Calif.—Her¬
H.
Howey, Jr., Thomas J,

bert

Largest of the day's offerings, James and Robert M. Kealhofer
a negotiated deal, was Inter¬
are now
connected with Russell
national Harvester Credit Corp.'s J. LeVesque & Assoiciates,
321
$50 million of 21-year, 4%%, se¬ South Beverly Drive.
and

Columbine

Colo. —Rupert

J.

Hernandez and George L. Simons
have joined the staff of Ideal Se¬

bonds.

associates

with

Join Ideal Securities

Corlies & Booker to Admit
Thursday,unless
there
is
a
;
\
change in present plans, will find
On Nov. 1, John Fraser Horn,
Columbia Gas Systems opening
member of the New York Stock
bids for $25 million of debentures
Exchange, will become a partner
while Indiana & Michigan Elec¬
in the Exchange member firm of
tric Co. looks over banking tenders
Corlies & Booker, 11 Wall Street,
for
its issue of $20 million of
New York City." "
"."V".

distributor

affiliated

(Spcciul to The Financial Chronicle)

"

,

(Special to The Financial Chiionicle)

especially well spoken for in ad¬
vance of the opening of the books.

ated route.

And, it was observed, investor
interest was of a nature to cheer

recapitulation of fac¬

siderably better reception, what
prices and yields more to the rolling over the balance will he
eased accordingly.
liking of investment interests.
-■

development in the field of

bonds, due to reach

Friday via the negoti¬

that

tors

a

with

The market has taken the latest

new
on

since the Federal Reserve System
owns about $8 billion of the $12

on

billion maturing debt, the task of

■

of

yesterday what with some
issues involving upward of
$170 million reaching market.

But

same

lion

market

This

:

in the cards.

Largest of these is Natural Gas

,

larger spread
force, but the
naturally will

the

remove

somewhat

ring periods of nervousness.

of
been

cor¬

Pipeline Co. of America's $30 mil¬

the part of member banks to take

better in ;the seasoned investment

new

offerings on tap for next
Only three issues of con¬

Hutzler

competitive bidding. Probable bidders: Halsey, Stuart &
* Inc.;
Estabrook & Co. and Coffin & Burr, Inc.
(jointly); Kidder, Peabody & Co. and White, Weld &
Co. (jointly). Offering—Expected this Fall.

A debentures marketed

4.68%.

ad¬

spread between such rates

now

up

an

rates to

term money rates
The

than

more

&

$5,000,000 first mortgage bonds.

.

as

Bros.

American

Co.

price of 99^ for

on

&

struction program.

(11/3)

stockholders

Salomon

and

Worcester Gas Light Co.

common

2%% at several Federal try for

to

Reserve

that

Co.

Loeb

"Aug. 18 it was reported that the company plans the sale

proposal to offer an additional 101,933
stock (par $5) for subscription by

a

Corp.

company

(jointly);
Securities Corp.
(jointly). (2) For any preferred stock—Merrill Lynch,
Pierce, Fenner & Smith; Salomon Bros. & Hutzler and
Eastman Dillon, Union Securities & Co.,
(jointly); Leh¬
man Brothers; Kuhn, Loeb & Co. and A. C.
Allyn & Co.
Inc. (jointly); The First Boston Corp.; White, Weld <£»
Co.; Kidder, Peabody & Co.

Ar Upjohn Co., -Kalamazoo, Mich.
Oct. 28 it

&

Kuhn

Society. Underwriters—Expected to be Leh¬
man Brothers/Smith, Barney & Co. and Merrill Lynch,
Pierce, Fenner & Smith, all of, New York. Offering—
Expected in November.

of 35-year

was announced

on.
Underwriter—To be determined by com¬
petitive bidding. Probable bidders: (1). For any bonds—
Halsey, Stuart & Co. Inc.; White Weld & Co.; The First
Boston Corp.; Kidder, Peabody & Co.; Merrill
Lynch*
Pierce, Fenner & Smith; Eastman Dillon, Union Secu¬

Chemical

—For construction program.

until

decided

Proceeds—

the

Corp. Offering—Not expeeted
early in 1959.

plans to sell ?baut
$12,500,000 of new securities in the last half of the cur¬
rent year.
The type. of securities has not yet been

between $50,000,000 and $60,000,000.' Approval

transaction

(jointly);

Boston

Wisconsin Public Service

was reported that an issue of common stock
be offered to the public, the proceeds Of which

the

Light Go.

was

1958 or

March 4 it

Aug. 13 it

of

/-

_

/

soon

First

late in

& Co.

may

N. E., Atlanta, Ga.

i Southern Bell Telephone & Telegraph Co. (12/9)
Sept. 22 directors authorized the issuance of $70,000,000

May

common

will

ability will offer additional common stock to its share¬
holders in the near future. Proceeds—To expand opera¬

»

Barney & Co. and Robert W. Baird & Co., Inc. (jointly^;
Equitable Securities Corp. and Eastman Dillon, Union
Securities & Co. (jointly); White, Weld & Co., Kidder,
Peabody & Co. and Salomon Bros. & Hutzler

^

v

plans to market

company

Universal Oil Products Co.

=

Power iA

announced that company plans to issue
$10,000,000 of first mortgage bonds. Pnrrrhdn
To retire bank loans and for construction
program. Un¬
derwriter — To be determined by
.competitive' bidding.
Probable bidders:
Halsey, Stuart & Co. Inc.; Smith.

(jointly); Lehman Bros.; Merrill
Lynch. Pierce, Fenner & Smith.
«

r

announced that the company in all prob-

was

$30,000,000 of

March 17 it

stock in the latter part of
1959, but this financ¬
ing may be put off until June, 1959: Proceeds—For con¬
struction program. Underwriter—May be determined by
competitive bidding. Probable bidders: White, Weld &

Southeastern Fidelity Fire Insurance Co.

\

announced

,

and Sell

this year or in the first quarter of

of properties

to

Union Electric Co., St. Louis, Mo.
was

•

Proeeeds-r-To be

&

jk South Coast Corp.

,

Dealer-Manager—Harriman Ripley & Co.

Inc.;: New York.

program.
Underwriters—Blyth
Co., Inc. and The First Boston Corp.
[At the same
time, an offering of not in excess of 11,000 shaies of
common stock will be made to
employees of the com¬
pany pursuant to an employees': instalment: purchase
plan.]
;
••••
|;

(12/2)
Sept. 22 it-was reported that the company plans offering..
700,000 additional shares of common stock, and plans to
apply to the State Public Utility Commission seeking
exemption from competitive bidding. Underwriter—May
be Merrill Lynch, Pierce, Fenner & Smith.

Public Service Electric A Gas Co.

:

.

By.'

Aug. 26 the directors approved a proposal to exchange
2,795,500 shares of 6% cumulative preferred stock (pa*
$10> for $32,148,250 new 6%: subordinated income sink¬
ing fund debentures to mature Aug. T, 2008 on the basie
of $11.50 principal amount of debentures for each
pre¬

construction

for

used

'

....

on

(12/2)

reported that

was

of

general corporate purposes. Underwriter —*• Kuhn,
& Co., New York;Registration—Expected early

November.:

Inc.

Bank, The First National City

Bank of New

Board, announced that the directors have authorized a
rights offering of 110,000 shares of common stock to
stockholders through subscription warrants on the basis

Loeb

in

E.

The Chase Manhattan

are

4-Tucson Gas, Electric Light & Power Co.;(11/25)
Oct. 29, J. R. Snider, President and Chairman of the

that directors are con¬
offering to common stockholders
additional 173,616 shares of common stock at rate

of

M.

r

corporation announced
a

in cooperation with the two investment
banking firms and a syndicate of commercial banks in
the United States, Canada and the
United Kingdom.
The three institution which are to head this
syndicate
government

offering of 260,000 shares
of common stock is planned.
Business—Trucking con¬
cern.
Underwriter—Blyth & Co., Inc., New York and
San Francisco, Calif.
;
•./,..
a
/ ^

^ Polaroid Corp.
sidering

I.

Oct. 27 it

petitive bidding. Probable bidders: Halsey, Stuart &
Co. Inc.; Morgan
Stanley & Co. and Drexel & Co.
(jointly); The First Boston Corp.; White^ Weld & Co.
Bids—Expected to be received oh Dec. 10.
Oct.: 27

(12/16)

was

Bids—Expected to be received
T.

held

Nov. 21.

Venezuela

(jointly); Kuhn, Loeb & Co., Blyth & to., Inc.,
Peabody & Co. and Merrill Lynch, Pierce,
Fenner & Smith
(jointly); White, Weld & Co.; Lehman
Brothers. Registration
Tentatively planned for Nov.

Proceeds—To

construction

on

(Government of) J;/ ^
i\s}-■■.
July 1 the Government announced that Kuhn, Loeb A
Co. and Kidder, Peabody &
Co., both of New York, have
been selected as financial advisors to
develop a financial
program for the country. As a first step in the
pro¬
gram a short-term credit is being negotiated between the

—

registration of $50,000,000 28-year bonds.

shares

of record Oct. 30,
1958; rights to
Price—$35 per share.: Underwriter r
—William R. Staats &
Co., Los Angeles, Calif.

Kidder,

(12/10)

15

expire

Hutzler

'

•

each

reported that the company plans to issue
and sell $12,500,000 of first
mortgage bonds due 1988.
Underwriter—To be determined by
competitive bidding.
Probable bidders: Halsey, Stuart & Co.
Inc.; Eastman
Dillon, Union Securities & Co. and Salomon Bros. &

construction pro¬

determined

* Texas Power & Light Co.
Oct. 20 it

plans the

company

35-year debentures, Proceeds — To reiund outstanding
$100,000,000 4%% debentures.: Underwriter—To be de¬
termined by competitive
bidding. Probable bidders;
Halsey, Stuart & Co. Inc.; Morgan Stanley & Co.
Of¬
fering—Has been postponed." Bids had been expected
about Sept. 30, 1958.

,

Company, 2185 Broadway.

Chronicle

The Commercial and Financial

46

.

.

Thursday, October 30, 19§8

.

(1810)

production and other figures for

The following statistical tabulations cover

Indications of Current

latest week

week

Business Activity
Latest

Equivalent to—
ingots and castings

,

,4

,

gallons each)

Crude

average (bbls.

of

6,892,585

Oct. 17
it

output
Kerosene output (bbls.)—
——
Distillate fuel oil output (bbls.)
Residual fuel oil output (bbls.)
Gasoline

at—-

(bbls.)

Kerosene

~

fuel oil

t'

)

7,861,000

28,010,000

27,736,000

2,001,000
12,310,000

1,794,000
12,101,000

6,613,000

6,896,000

7,513,000

Nonhousekeeping
Industrial

31,520,000

,

161,341,000
68,020,000

17

:

-

,35,012,000

149,461,000

173,785,000

68,893,000

58,823,000

68,996,000

Revenue

ENGINEERING

CIVIL

CONSTRUCTION

NEWS-RECORD:

Social

*

BUREAU OF RUNES):
Bituminous coal and lignite (tons)
Pennsylvania anthracite (tons)

;

RESERVE

472,000

VT

*8,715,000
457,000

8,425,000

519,000

-

at

136

6.196c

6.196C

5.967C

$66.41

$66.41

$66.42

$66.41

$42.83

27.300c

20.100c

28.975c

25.800c

Utilities

Public

Industrials

Group

Group

,.U. S. Government

13.000c

11.000c

12.800c

12.800c

10.800c

11.500c

11.500c

10.500c

All

10.500c

Oct. 28

10.000c

11.000c

11.000c

24.700c

24.700c

24.700c

Average corporate

Jet. 28

—--—

—

96.125c

92.500c

1

-

Baa

i.—

„

-

Railroad

Group

———

Utilities

Public

Industrials

Group

.

Group

MOODY'S COMMODITY INDEX-——-

—

28
Jet. 28
Oct. 28
——-—Oct. 28
——
—Oct. 28
Oct. 28
Oct. 28

Production

(tons)

Percentage

88.46

East

89.92

90.06

98.78

94.71

94.26

93.08

92.64

89.78

89.92

89.23

83.53

83.15

TRANSACTIONS

ROUND-LOT

88.13

88.27

88.81

91.05

89.64

89.37

92.64

92.06

3.57

4.42

4.41

4.43

4.11

4.09

4.20

4.20 !...

4.44

4.43

4.91

4.90

4.93

4.56

4.55

4.54

4.44

4.46

4.25

4.23

4.27

389.4

390.2

392.5

384.2

Total

433,785

466,878

446,577

467,232

MEM¬

Other
Total

Other transactions Initiated off
Total

Other

Total

346,400

244,890

83,860

129,770
875,004

575,570

_)Ct.

1,089,957

1,004,774

659,430

4,173,795

3,932,189

2,425,210

:

—

367,950
427,700

771,180

686,920

420,350

sales

3,660,567

2,123,950

4,431,747

sales by dealers
Number of shares

Dollar

N.

Y.

-Oct.

short sales-

Customers'

Customers'

Dollar

1,639,940

1,624,854

1,038,465

Jet.

6,105

6,252

5,334
1,033,131

value

—

$75,079,964

1,618,602
$75,586,968

-Oct.

546,710

543,880

336,310

546,710

543,880

336310

-505,310

445,170

1,633,835

-

•hort

shares—Total

of

sales

.

Other sales.

Jet.

.Jet.

Round-lot purchases by dealers—
Number of shares

Net

771,129
.

■

,

Net

10,159
760.970

$34,748,451
.

4

325,190

"

--

Other sales
Tstal

Jet.
jet.

.

sales

.....

,

PRICES, NEW SERIES-

■U.

S. DEPT.

7___

;

153,070

153^070

commodities

22.637

24,225

27^71

33.595

35,834

45,490

77—

!

.

of

545,380

AH •■■modities other than
fane

.

.

.

'tfure.

one-half cent

a

pound.




«■«.

240.8

97.1

103.1!

63.6

63.5

64.0-

33.8

__

-33.7

!__7.

43.6

.

9.1
56.4

*

;

.

'

-

,

31.8

.»

26.5

y

,

31.8

56.3
'

26.7

/

6

94

*31.8

31.9

7'
for

32.9

9.0

-

-

40

48.0

,

-

•

21.5

.
•

in-'

special

6.8

7___

__7_;

.v

•

7.0

-

!

6.7!
336.6

*342.0

338.9

August:

*

(barrels)"

>

7

EARNINGS

-

31,675,000-

21,406,000 6

*29;833,000

34.139.090

3? *>"1 n"*0

35 365 000

27,889,000

30,647.000

20,018,000

95

90

104

.7

$834,789,583

$779,494,514

$931,117 ,006

7.

629,886,592

627,385,091

;

7

—

CLA$S'l

ROADS

(AS-

operating expenses

93,036,746.
77,000,-000

34,000,000

6,711,484

railway Piieratiflg income Before charges
income after charges (estimated)
7

MANUFACTURERS

8,317,705

Shipments
'

.

80,000,000 '

ASSOCIATION,
„

j

t..

-

(

-

-

:_

7_I

i

6,732,679

i

--^,626,747
-7,800,709 "

6.367,899
'

*15,500,667

15,535,224

:

1,136,645

—

-45,348.234

7_7

__1_7_7__l_.

::

.1,068.884

1—7—ii

Inventory

919,Ml

2,905,858

,3,114,255

:__*_—

-

1,205,980
:4ii'6.75o;

1,255,497
"

Production

;

"702,265,956.
J.08,801,411 ,
(16,434,686

74,753,448
51,639,492"

:

-

V.3fl28,949-

,

905,900

19,330,320
20,236,220

858,740

554,170

535,110

18,799,540

11,766,890

19,658,280

12,321,060

.»

8.Q02.150

8,53"/,260

Productkm

7

:

^

Inventory
Passenger Motorcycle,

Truck

Biis

and

Inner

118.6

118.8

118.9

1111?

*

Tubes (Number of)—

_

-

C

f ^

■

.

t

92.1
110.1

iSS

105.0

105,1

104.9

110.0

80.8

_Oct. 21

126.0

126.1

126.6

|63,123

1

I

-

:

r'

3.465,795/

3.682,817

3;305,328

2,389,695

-

'7,664,108

Shipments

7,680,282

■

3,134,192
5,965,804

3,331,264
-"

Inventory

_l_

Tread Rubber (Camelback)—

91.7

91.3

"640,504

652,631

'

.*

109.9

'

Shipments

(pounds)

Production

.

!

125.6

*

"

'

275,981 ~

279,907
...

644,209
246,b99:

274,947

266,113

.__

-

CIncludes 835,600 barrels of foreign cruie runs. § Based on new annual capacity of 140,743,570 tons
against Jan. A, 1991 basis OI 133,459.150 tons, t Number w orders wv repoi tedsihce_ maou^c ^on -•
WUB.
lj iwj oasis of
of
not
ox
tPrime Western Zinc sold on delivered basis at centers where freight from East St.- Lewis exceeds
-»v

$352.1

"232.2

..

(BUREAU OF MINES)—

'Shipments

jet. 21
_Qct. 21
and foods.

$358.8

97.4

.

Tractor-Implement Tires (NUhfber of)—

OF

_

Moats

-i'15"

238.4

.

-

:
dividends

____-_7__

—7

.58,820-

255

-

k

.

payments—

jontribution

282,372f

49,478

$355.6

„

totali._-_7_ 7—

and

180,313

215

v

—1—77.

income

341,407-1

7

230,046

;

47.425

;

receipts,

■

131.345
'

.

•

UNITElJ STATES

labor income7—

transfer

179,585

7_771*''

Inventory. i7_7_7_>
.,7—__7—7
Truck and Bus Tires (Number ofh-^r ;■. • r
'

■<

_Oet. 21

foods.

•

FROM

OF

Production
1

7

_Oct. 21

products.

PrtHtsssJ

.90,132

7

coaches

IN TIIE

Shipments

-

Farm

3,220,216'

78,391

,

.

.-i!

Production
AS

2,809.287

68,618

INC.—Month of August:

-

TOTAL ROUND-LOT STOCK gALBg ON THE N. Y. STOCK
EXCHANGE AND ROUND-LOT STOCK TRANSACTIONS
FOR ACCOUNT OF MEMBERS (SHARES):
Total rotmd-lot sales—
Short sales
Oct.

145,608'»

130.498

130,943

2,835,681
.

August:

RUBBER

•

.Oct.

76,459:

*

Passenger'Tires (Numoer of)—
sales.

167,213

•

..

income.

employees'

Total

Round-lot sales by dealers—
Number

526,609

129,855

SOCLiTJON OF AMERICAN RRs,)—Month

$51,682,100

$45,813,508

Jet.

733,023

86,877,397

jet.,

other sales—

603,068

809,160

___7__

Capacity used (per cent)_

of

1,169,208

1,024,107
$46,827,523

$76,923,218

644,028

900,236

V

"Total operating revenues.

"

value

$1,247,096

721,439

.7!

FACTORY " SALES

salary

and

Month

1,783,230

2,544,300

1,530,617
$72,642,126

$1,621,G75

939,015

_2__7

Shipments from mills (barrels )_x
Stocks, (at end of month—barrels)

«

-

-

MINES)—

7,

ounces)_.

motor

personal

RAILROAD

1,604,009

Odd-lot purchases by dealers (customers' sales)—
Number of orders—Customers' total sales—

OF

i

•«.

VEHICLE

Production

STOCK
,

c

72,289.031. ,■
491,168,447-

619.464,813

$1,348,121

-- -

Total nonagricultural income

COMMISSION:

(customers' purchases)—t

43,205,835

409,106

ounces),

fine

PORTLAND CEMENT

.

DEALERS AND SPECIALISTS ON
— SECURITIES
EXCHANGE

fine

surance

1,430,890

-Oct.

3,410,664
4,097,584

EXCHANGE

104,770,856

120,681,539

of

COMMERCE)—Month
August (in billion^);
„

Less

.

352,340

-Jet.

STOCK TRANSACTIONS FOR ODD-LOT ACCOUNT OF ODDLOT

(BUREAU

Personal, interest

1,628,230

-Oct.

Odd-lot

$563,457,478

103,987,432
547,604,857

Proprietory and rental income—7

.

59,750

_

sales

sales

104,331,109

$724,235,669

•

:

__

.

(in

Other

345,490

517,270

167,950

160,215,945

$651,592,289

_7__

(in abort tons!

Total

202,490

389,500

872,145

17,683,379

___-i

7__7

municipal-^-'—1;——7

Number of

,

transactions for account of members—

purchases.

Short

;

42,400

.Oct.

sales

round-lot

Total

43,100

ct.

42.129,864

35,202,075

$33,990,357!

•

1,110,640

765,790

Other sales
Total
Total

and

Month

—

1,495,370

Jet.
.

37,250,830

__i_

(in short tons)

Total

—

<79,381,380

___!7!_______!__7

Commodity producing industries^
Distributing industnes'__77_7_—'.7
Service industries
=7—.
Govei'nment ___!
..7!
1

the floor—

sales

construction

860,450

786,759

118,323.349

44

CONSTRUCTION—EN¬

NEWS-RECORD

1,201,980

686,190

122,054,015 !

40,918,850

.ill!ii_„

! Number of passenger cars,
Number -of motor trucks—

,

202,890

699,500

123,215,009

City

Wage

398,530

661,200

64,178,226

...

250,190

922,007

purchases—

Short

;

1,079,850

675,880

/ct.

_

160,066,771

PLANTS. IN U. S.—AUTOMOBILE MANU- ;
FACTURERS' ASSN.—Month of September:
Total number of, vehicles'
—7777
r—
77 7*^

'

jet.

sales

$25,783,464

110,880,048

293,390

floor—

sales

11-

$22,667,711

1,509,410

64,000
622,190

15

39,559,602

...

Jet.

16

• -

&

:_

construction

(in

ol'

,

103 '

:

SPECIALISTS:

_

103

7

States

(DEPARTMENT

in which registered-

—

50 ,v"

51

102

32,254,320
118,482,908

Zinc

109.66

38,300

Total purchases

52

51

'

76*'-

50

DUN

—

l;

PERSONAL INCOME

2,077,360
2,642,290
on the

108.69

2,469,550
493,150
1,913,470
2,406,620

126

79

,

Copper (in short tons)___._——__7!7_——

'

564,930

131

79

■

_J_l_l

United States':'

*

2,535,860

*130

.'

V

CITIES—Month

City

S.

Silver

98

OF

607

Mine production of recoverable metals in the

308,059

108.69

138-

675

122,034,982

OUTPUT

Gold

254,914

108.60

43

120

685

Month of June:

'' '

95

Oct. 24

46

'

260,256

Oct. 18
Oct. 18

30"

;

54

164,793,868

INC.—315

construction

METAL

5.01

311,174

Jet.

Initiated

U.

Federal

4.47

95

purchases

Other transactions

■>*

*.r

296,458

-—

56

261 1

34

'r 43

71

VALUATION

Lead
'

36

257
-v!

43

*.*

7_.

New York

State

4.28

52*
416}'

'

.

3 *125

2

United

Private

4.34

.

;

;

development—

ENGINEERING

Total

4.50

.

V

.

34

,135

-

2,——________7

GINEERING

4.12

4.23

308,795

BERS, EXCEPT ODD-LOT DEALERS AND
Transactions of specialists in stocks

enterprisesij.il'

and

September (000's omitted): 7,,

4.58

4.43

4.12

4.42

19-1.497

422

■

7-,-«*«•• )i«"*'258

•

4.47

95

i—

1425^

7

7.7

public

York

CIVIL

3.72

3.62

-

.*

17

71

2

Public

'

87!
432

1,588

Atlantic

Outside

87.72

314,445

ACCOUNT

FOR

!77-__2

Central

New

'

,

18

:

7_T72i——_!7
systems_7_777_7__—7!_7">2

PERMIT

Total

82.15

87.99

92.35

37,

77
'

_li—77_!7!7..111'

91.91

89.64
83.40

.<■,

34

451

73

Central

West

94.26

89.78

159'
556

1,606

Mountain

89.23

94.41

283,024

Unfilled orders

•,'

Z_.

Pacific
4

Oct. 18

OIL, PAINT AND DRUG REPORTER PRICE INDEX—
1949 AVERAGE = 109,

;

16!

1751

..74

buildings.-.*!-— 7_7_l

South Central

86.25

87.94'

-————Oct. 18

of activity
(tons) at end of period

——

77

Atlantic

MOTOR

NATIONAL PAPERBOARD ASSOCIATION:
Orders received (tons)
—

51-

562'

:

455

.

—

England

South

91.125c

aT _ZZZZZZZ-ZZZIZIZZZZZIZZZZZZZIZZZZZZZZZZZZZZZZZ-ZZ Jet!
A

■■V

43;

August:

Middle

26.000c

96.375c

•

162
565

■:

:

other

New

13.300c

10.000c

3.60

'

X

^2

servicell'—J7_—7

and

water

Conservation

13.500c

AVERAGES:

Bonds

81:

29 '

22

.•

-

_i_J—_ii7

_7_1

;

Public -service*

'

YIELD DAILY

BOND

MOODY'S

and

Sewer

22.375c

13.000c

jct- 28
Jet- 28
Jet. 28
jet. 28

Group

.

42

33

...

26.400c

29.950c

It

/

.

7-12!

nonresidential

BUILDING

27.375c

Jet. 28

43

-v

—7

Military facilities
Highways

$35.33

$43.17

$42.50

88.11

:■"

'

Other

93.08

Railroad

225

53

52

36

Water

'Jet-

"ZZZZZZZZZZZZZZZZZZZZ

149!

52

53

,

2277-2

const ruction

Sewer

00

-

79

!•

V

7_.

Educational

281

-Oct. 22

DAILY AVERAGES:
U. s. Government Bonds—,—
Average corporate
—

Baa

-7

Administrative

'.

208

oi

vT

.

■248

80

•

!;

._"_77_7——_L_i

—

Hospital and institutional——_^_7.

288

MOODY'S BOND PRICES

r

utilities

Industrial

9.862,000

499,000

;

275

Jet. 22

(primary pig. 99%)
tin (New York) at

v

J 73

__/'

.2—1

construction

buildings l__.
Nonresidential buildings

11,787,000

Jet- 22

Aluminum

,■!: 322

147

252

■

—i.-—'/v„'-2 Trp24

Residential

'

12.342,000

Jet. 22
Jet. 22

(delivered) at
Zinc (East St. Louis) at—

Aa

Public

of

at

316
*169

recreatioimlrr!__!;;.;_—v

BRADSTREET,

York) at
(St. Louis) at

Straits

-

16,398,000

12,048,000

Jet. 22

(New

179

*

3T6"

-w

12,174,000

tZinc

■

-

...

QUOTATIONS):

(E. & M. J.

840 ;
293

,148

■ ,,:

Telephone and telegraph—t:
Other public utilities
———2^
772.1" X-'*' ■
All other private—1
.7,
—_77l_-7__",—X

,

129,548,000

216,180,000

147

Jet.21
->ct. 21

Electrolytic copper—
Domestic refinery at
Export refinery

-

213,612,000

146

,

steel (per lb.)

METAL PRICES

112,155,000

8,530,000

Jet. 25
DUN & Jet. 23

—

(per gross ton)
steel (per gross ton)

Lead

30,596,000

Oct. 18

Pig iron

Lead

16,758,000

COMPOSITE PRICES:

AGE

Scrap

246,776,000

,120,849,000

135,955,000
119,197,000

-145,946,000

$248,110,000

6.196c

INDUSTRIAL)

(COMMERCIAL AND
BRADSTREET, INC. —
—

FAILURES

Farm

$359,558,000

147,613,000

Jet. 18
Jet, lb

—-

EDISON ELECTRIC INSTITUTE:
Electric output (in 000 kwh.)

Finished

.,..606,672

$370,670,000
123,894,000

$251,425,000
103,812,000

'*

SALES INDEX—FEDERAL
AVERAGE = 100

DEPARTMENT STORE
SYSTEM—1947-4!)

557,921,"

569,817

26,764,000

„

Jet. 2.1
Jee-

—

i.—

743

;168

•

__

Miscellaneous,

Public

OUTPUT (U. S.

COAL

686,138

695,768

563,777

oci. H
Jet. 2.1

construction
Public construction—
State and municipal

'

18

n.

!_

_v—:

'_i—

and

Railroad

-

private

IRON

!'

726,812

667,277

ENGINEERING

—

L

construction

6.

U.

Total

47;

374

*

ASSOCIATION OF
Revenue

51

,.,'174

——2

Hospital and institutional—
'

AMERICAN RAILROADS:
freight loaded (number of cars)—.—•
freight received from connections (no. of cars)—Oct.

51

.

;

——

,

387

742

____y

i

buildings

Educational

-

1,190

3,185 i

371

—

-

1,611

1,280

$4,682

1

Other nonresidential buildings—/>-•;
Religiousi
I
1-12.

!•

7

1,718

1,320

buildings and warehouses
u* •! ?•
Stores, restaurants, and ^rages!/l___/:

^

3,215

1,742

_

___

Commercial

179,263,000

$4,803

;3,229

i

.

Office

173,158,000
30,011,000

Ago

-

$4,835
+j;:

______

alterations——_

and

Nonresidential

Month

:

Year

'

OF

_

:

buildings (nonfarm)J.
dwelling units

Additions

"

172,914,000
13,364,000
158,742,000

170,361,000

•

Jet. 17
Oct. 17

(bbls.) at
(bbls.) at

Distillate fuel oil
Residual

-7,604,000

12,704,000
6,838,000

^

terminals, in transit, in pipe linesunfinished gasoline (bbls.) at__
Oct.17

and

Finished

7,723,000
27,636,000
2,262,000
12,292,000

2,452.000

Jet. it

refineries, bulk

Stocks at

DEPT.

construction

New

6,746,815

25,991,000

°ct- 17

—

7,087,085

fi 7,613,000

\l

7--—-

6,873,785

Previous

of September (in millions):

construction—.

new

Private

.

stills—daily average (bbls.)

to

runs

2,041,000

1,901,000

Total

S.

of that dates

are as

Month

♦»«-

CONSTRUCTION—U.

BUILDING

either for the

are

Latest

79.7

70.4

*2,026,000

S2,009,000

of quotations,

cases

Residential

AMERICAN PETROLEUM INSTITUTE:
Crude oil and condensate output—daily
42

o

Nov.

in

or,

Ago

Ago

*75.1

that date,

on

Year

LABOR—Month

(net tons)

Steel

month ended

Week

§74.4

Nov. 2

Dates shown in first column

month available.

Month

Previous

Week

AMERICAN IRON AND STEEL INSTITUTE:
Indicated Steel operations (per cent capacity).

or

or

(pounds)

41,622,000

39,154,000

43,621,000
31,988,000

" *38,569,000
*30^71000

*

r

Inventory

ZINC

OXIDE

(pounds)
(BUREAU

•

OF

r-.et August:
Ploauetidh (short - tons J*

Shipments

(short

MINES).

•

^*4,466,000
**41,055,000
25,115.000

•Month

'

tons)—

Stocks at cad of month (short tons).

14,427

--15MH3

14,038

14,830

21,606

21^11

-

.

v

15,442

45.389

*8,727

Volume

188

Number 5790

.

The Commercial and Financial Chronicle

.

.

'

(miy

•

,

question which

is

thd

negotiations^,

surface

in

not

shown

on

Robert L. Ferman Adds

and

which might come as a
block, is
which management and
company
will come up as the control.

m

dividend* Nemca

MIAMI, Fla.—Jack Buchsbaum
has become connected with Robert
L.

Ferman

&

Company*

Building.

Birmingham, Aim, October

Ainsley

I95B

The Board of Directors this da# ttrhffd

•>,

quarterly dividend of thirty centifr(3flMl
per share on. the outstandmg ComnwftSteck

a

Walston Miami Branch
Dividends and Merger
The past few weeks
the

have

seen

interesting developments in

some

declarations of

dividends by
Probably one of the
most important actions taken was
t£taf" by*~tfce ^eijnsylvania Rail¬
road. This road preserve^; its un¬
broken record of having paid'Sr
dividend for each year since 1848,
or 111
years.
This is the longest
dividend paying record of any
railroads*

company listed on

Stock

Exchange.

It is
ment

the New York

interesting to note the
with

made

the

com¬

official

an¬

nouncement of the declaration.

stated that

was

the

income

have held
ber

of yeans.

true

of

the

depend

many

from

this

the stock

a

on

and

source

over

It

num¬

This is particularly
along the line of

railroad-

holders

Many

have

been

stockholders for years and in fact
the stock has been held within

"family"'

a

and

generation
payment

to

was

on

from

generation.
declared

This

passed

even

though earnings for the full year
probably will not be sufficient to
the payment. Indications are

cover

that for the full year the road will
show only a small "net income on

the

It

.

pointed

was

that

the

road

*'*

f

stock,

common

out,

however,

continues

its

pro¬

of debt- retirement, -despite

gram

deficits during mosfcQf the months
this year. For the full year, dotal
amount

of

to' be

debt

retired is
expected to " approximate " some
$29,000,000. Even with do w earn¬
ings, Pennsylvania is; likely, Ito
continue
gram^

its

debt

On

the

-

reduction

In the long

be of benefit
;

•

run,

pro¬

this wilt

the stockholders.

to

hand

other

New

York

Central; "second only to the Penn¬
sylvania, is not expected to-pay
any

dividends this. year.

have
eash

been

down

Earnings
sharply and the

nancial

seem

to

justify

any

divi¬

dend

payment.
This brings into
focus the current talks between

the ; two.
merger.

roads
of
a
possible
It is thought in financial

of

to

due

earning

power

financial condition. Further
in

the

direction

facilities

such
for

nounced
are

of

the

and

moves

— Walston
& Co.,
Inc. has opened a branch office at
245 Southeast First

Street, under

the

management of
O'Brien.

X.

James

York

an¬

V. L. Norwood

Harbor,

CLEARWATER, Fla.
J.

Battles is

&

Stautz.

Admit

to

particularly
hour

in

view

in wages

scheduled

of

the

in¬

of seven cents
Nov.

for

an

Another declaration of great in¬
was the action by the Board
Directors

cific in

of

making

the
a

subject to

dend,

approval, plus
quarterly dividend.
This could have the significance
of bringing closer the merger of
which

ern

has

been

under

time.

some

a

larger number of shares outstand¬

ing, Northern Pacific would be in
a
better position on an exchange
of stock for
out

a

new

share

for: each

As J

proposed

of

In any event,
that the roads will be

basis

consolidate

to

it
on

ST.
liam

PETERSBURG,
R.

Chase

and

Northerji

ing, closely watched in
well

as-

railroad

is. now

DIVIDEND NOTICES

Dividend

GRIFFIN,/

^1

able

2%

on

the

SOUTHERN
a

1 NATURAL

common

stock, pay¬
November 28, 1958,. to stock¬

on

Notice

1

i

Common Stnek

on

The Board of Directors has declared

common

holders of record November

GAD

COMPANY
■

'

■

•

5

10, 1958.

Seelaus,
Secretary-Treasurer

'a,.

Birmingham, Alabama

• i

*

'

•

U"

5

October 23, 1958

Common Stock Di vidondNo; 79

' A regular quarterlV1 cHvb
cents1 per share

J

lend1 of 50

AMERICAN A

ff

Hud eon
and

POWER

COMPANY INC.

($.75) (Canadian)
declared

Ill CHOICH STREET, NEW YORK 7, N.Y.

at

York

Common

Stock

shareholders of record

at

a

H. W.

a,

Balcogyen%
end

_

f ber 28> 1958.
H. K McHENRY,
;
Vice President ancPSecretary.

November 14, 1958,

L

1

Dated! October 25,1958.
*

U>

to

Tht Singer

the

Executive Vice President

October 24,

pay.'

fl»uuuMuuuuiiuuuuuuuuuBuuuunruragWu«Mi

close of business November 10,
1958.
\'

financial

on

the

for

December 10,1958

payment

be¬

cents

share has been

Capital Stock of this

J. F; McCARTHY, Treasurer.

this day, declared a quarterly
dividend of 25 cents per share
the

seventy-five
per

otr

able December 12, 19501^
stockholders of. record at the.
close of business off NoveW-

S

shareholders of record at the close

to

of business

meeting held

a

the

on

declare#

J Natural* Gas Company,

Company, payable December 15, 1958,

The Board of Directors of the

Company,

of

Common Stock of Southerrt'

76!

Kay Mining

Smelting Co., Limited
Dividend

A

has been

j

[DIVIDEND NO.

FOREIGN

the

as

re-

■

"

on

are

M. E.

R. Henry

Dividend

Pacific-

circles

Fla.—Wil¬

stock dividend of

oetter

Pennsylvania- New

entittedf

reported* records date;

.

• "

and the Class "B"

Of the Great Northern.
The

stockholders

Secretary-Treasurer

affiliated

cles,:it is thought, will further
improve the operating efficiency

Central

in

located in

tin elates and Ontario

Goodbody & Co., 218 Beach
Drive, North.

operations, which in railroad cir~

Great Northern situations

in 17 cities,

l;

date for determi¬

nw

This notice is- given to correct error

Secretary

Manuiacturinpi plant*

Staff

to

with

any

of

some

to Staff

of

cer¬

December

such. payment.

FISCHER! & POTTER COMPANY

appears
a

nation

shareholders of record at the

to

close of business Nov. 6,1958.

Goodbody Adds

Northern has the better operating
results.

Company* payable Nov. 25*. 1958,

;

Great

course,

1958. There is

shares oft the

after

or

West.

company.

'Counter,, of

a

common

than

more

share

the

oil

on

Goodbody & Co.,, 419 12th Street,

In this
manner, its stockholders would be
in a'better position to capitalize
on its large land holding with its
production of oil and natural gas.
new

tificates

seventy-five cent8-175cVper share

redemption* o£ entire*

surrender of share

Heaton has become affiliated with

company, with¬

having to demand

one

issue upon,

BRADENTON, Fla.—Donald W.

con¬

With

OnOct. 23; 1958,-the Board of
a dividend of

(Special to The Financial Chronicle)

Northern Pacific and Great North¬

sideration for

dividend1 is payable; only in. cOBfr
nection with

Difectora declared

r.g. hengst,

20% stock divi¬
Interstate Com¬

regular

:

-

Goodbody Adds

Northern Pa¬

Commission

merce

the

JOHN W. BRENNAN, Secretary & Itwsmvr

,

DIVIDENO MV. ISO

DENVER, Colo.—John F. Peverley has become connected with
Liberty Investment Company, 511

terest
of

remain* Open*.

Woo dull Industries preferred stock

CMVEtMMff 1KONIO

(Special to The Financial Chronicle)

16th Street.

1.

will

r

EATOV

^o

crease

books

transfer

United States Pipe

Deringer
Inc., 1442 Gulf-to-Bay

substantial savings in

roads.

as

Francis

—

with

now

DIVIDEND NOTICES

of the

costs,

Company, payable December 13$. WW,
on December 1/1058.

stockholders of record

V. Lee Norwood &
Co., 20 Ex¬

This could result

of activities would go a long way
in bringing down operating

of this
to

The

Place, New York City,
a number change
major" cities served'by both members of the New York Stock
It is agreed that terminal Exchange, on Nov. 17 will admit
costs, especially for the Eastern Walter V. Cook
partnership.
carriers, is a heavy burden, on
earnings because of switching and
Joins Liberty Inv.
handling of traffic. Coordination

-in

Deringer & Stautz

(Special to The Financial ChroMiCEE)

Boulevard.

probable indication of future yail
strong pos--:
sibility of some' coordinationt of: mergers, many of which now are
One
duplicate facilities but not of a fi¬ under -consideration.
big
circles that there is

F.

eliminating

recently

as

New

anticipated.

With

MIAMI, Fla.

consolidation

difference

position at the present time

does not

Prospects

Secretary

1958.

Manufacturing

Company
The

Board

of

Directors

has

declared

Southerir

a

quarterly dividend of fifty-five cents per share
payable on December 12, 1958 to stockholders
of

14.

record at the

close of business

on

November

Railway

1958.
D.

October

28,

H.

ALEXANDER, Secretary

1958.

Company

DIVIDEND NOTICE:

DIVIDEND NOTICE
'*

New York, October 28, 1958.

600 FIFTH AVENUE

National

NEW YORK

20, N.Y.

A dividend of

Distillers

COMMON

m

and

value of

STOCK

No* 112

<

clared

25$

On October 22, 1958 a regu¬

cember

Directors* has

quarterly

a

per

share

Common

on

quarterly dividend of 75
share was declared
the Corporation's Com¬
mon Stock, payable Decem¬
ber 15, 1958 to stockholders

dividend of

Stock, payable on

record

at

the- close

of

business

1958*.

•

J. J. MAHER, Secretory.

,

of record at the close of busi¬

De¬

on

ness

on

November 15, 1958.

November TO, 1958.

SINCLAIR

<\ The transfer books will not dote.

TheUnite#Ce«

'

4-r

.

v

r

|70<f per

the Common Stock. wifKoub per

\ November 14,

on

the outstanding

of

ers

cents per
de-

oir

1/1958^ t<r stockholders

of record*

"

par

j, value of Southern Roilwoy Company- hO»
today been declared- out of the surplus of
net profits of the Company for the fiscch
year ended December 3t, 1957/ poy«
able December 15, 1958, to stockholds

lar
NOTICE

DIVIDEND

,

Company of the

share has today beeir

A dividend of seventy cents'

share

Corporation
of

per

business November 14,1958.

Chemical

Board

$20

declared, payable December 15, 1V58V
to stockholders of record at the-close of

DIVIDEND

The

l'A% (23r<)*per iftortT

3,000,000' shares oft Preferred^Stock*

on

of Southern. Railway

"•

October

PAUt C.

23/ T^S

JAMESON

A Great Name in Oil

Mmpruvunieivf
(

Treasurer

Company
DIVIDEND NOTICE
A

V, T :' fc

k

-W:

t- J&rVv- -ft*

•

A

i
JV
..

regular

bees*

v..

L,' *

-

_

J ** *•-

Tobacco Company,
to

the..
payable fafgash

-

stockholders of record af.tbof close of business November

October 28, 1958
©A. T. Co.




-

;

Harry

-

A

COMMON AND PREFERRED DIVIDENDS

The Board of Directors hat declared

December 1,

on

December 18,

etockholdere of

jrecend

November 28, 18582-

American

10, 1958. Checks will be mailed/

h.-:

10581 to

r

dividend of On^ I^arJSLOO) per share has

dedfcajrei upon

the Common Stoekr par

declare* payable

RUBBER COMPANY

213TH COMMON DIVIDEND
,

ow

value $13.50 per shares has* been

i?

tr

quarterly dividend1 of 55e peY'

•ham

GOODALL

-

yard

quarterly dividend of
$.125 per share on ah Common Stock outstanding and
regular semi -annuat dividend of $2.50 per share on the 5%
Preferred Stock, both payable November 15,1958 to stock¬
holders of record afthedose of business November 1,1958.

Vice President end Treasurer

a

B. GL BOSCH

October 28,1958
-

-

,ltn

"

'

"n""

'

quarterly dividend o#$L.<SH3£

ehaire on.the 4%%. Preferredi

Stock has been declared, payable

January' 1, 1059 to stockhofifers
of record November

1

Secretary A Treasurer
-

per

28,. 10581

J. H. Macnknzte,

Treasurer
...•

Philadelphia, October 28j 1058k

••

The Commercial and Financial Chronicle
48

,

.Thursday, October 30, 1958

(1812)
ices, etc.)—Robert F. Warner,
Incorporated, 17 East 45th St., New York 17, N. Y.
(paper)."^

BUSINESS BUZZ

Process

Due

Joseph Lazar
Industrial Rela¬

of

—Institute

Railroads-^

the

on

Revised Edition

—

tions, 100 Business Administra¬
tion-Economics Building, Uni"

that the

probably will take several more
years
of "education," and a
greater threat to the free enter¬
prise system, to get business¬
men
to start politicking at the

but

level,

precinct

these

headaches

of

*

Department

The

<
:

keep money ^iri
to. pay the bills
of Uncle Sam. At this time of
Treasury

the

1

For this reason,

management are work¬

j

percentage standpoint is negli¬ ;i ing operations that are coming
gible. Yet, more and more are ; j up.
'
trying to elect the best quali¬
j
The Democrats — many of
fied candidate, regardless of the
them are New Dealers and a

time.

>

number from a

V

ing.
!

^

.

..

-

maintaining
that labor is supporting candi¬
dates" of both
major parties.
That is certainly correct as far
as
it goes, but the facts are
Labor, leaders are

'

•

the number of
Republican candidates probably
could be counted on two hands,
House, ; while

of
t

{

"I

Vice-Presi¬

and

President

in
statements,
speaks only for Northern wing
of the party, although theoretically he is supposed to be talking for the whole party.

going to take a licking Nov.
instance the predictions
that
the
Democrats will
t

capture

a

Senate

12

majority of from 8 to
seats, and up to as

Perhaps the paramount ques¬
tion of the hour is: What kind

,

„

j

what kind of

of Democrats and

Republicans are going to fill
the Governorship seats and the
Senate
and
House
seats
in
state

various

the

and

Washington

Not All Alike

.

There

are

Democrats who

are

each other in
political philosophy, just as
is

there

a

wide

chasm

ginia and Senator Hubert H.
Humphrey of Minnesota wear
the Democratic label and sit on
the same side of the aisle, but

they have little in common in
their
political philosophy.
In
the Republican camp, for in¬

There

I

with

say

of New York is

far removed

as

of Nevada

as

the East is from

the West.1'

.

^

•

*

1

For

.

j

all

practical

purposes

same

Senator

and *

Belong to the

Senator Byrd
Malone
should

same

party..

•

alignment of the two major
parties. How that can be done
with success, is an unanswered
Question.
Treasury's Headaches

I Traditionally,,
are"

the

press.

,

„

free

The

the

V

j

Democrats

spenders

records

.

of

in
the

Conlast

not say so

of

j

Meantime,

business

Mountain

that' the
will

State

of Jefferson and Jackson.
-

Republican
emerge

;

that

i

f

>

,

;

take

a

big !
will !

perhaps the

story

that

from it will be the fact

for

all

practical

hard-hitting
;

be

'
_

Republicans

<

now

and

1960

ap¬

uncontrolled
deficit spending
and perhaps inflation. .
J-

\

particular, believe

i

to decide whom

for

purposes

Vice-President

Philip

M.

Talbot,
of the

Chairman of tthe Board

the "sleeper" state for the party

licking,

delegates to

and the country are

in

sound

the

labor monopoly,

r

United

i

to

j

Chamber

of

of "Commerce

States,

and

some

the

other

men
are
concurring
publicly in Vice-President Nix¬
on's recent speech when he told

business

,

,

the "Chronicle's" own views.]

n o

fh i

Fact

—

projects

major

companies
of utilities—Electric
Public Information
Program, 2 West 45th Street,
New York 36, N. Y.—Available
in quantities of 10 at $2.50 for
10- •
:
;
■
' *'
'
groups

•

of Industrial

Relations, Univer¬

sity of California, Business Ad¬
ministration-Economics

Bldg.,
24, Calif., $1.75.

Los Angeles

Airline Traffic and Financial Data

Quarterly Review — Air
Transport Association of Amer¬

—

1000 Connecticut Avenue,
N.
W., Washington 6, D. C.
(paper).

Walter

Credits

and

Acceptances—
Ward

Edition—Wilbert

Fourth

The
Ronald Press Company, 15 East
26th Street, New York 10, N. Y.
and

Henry

Harfield

—

of Public Employ¬
U. S. Department of

Compendium
ment

—•

Commerce, Bureau of the Cen¬
sus—U. S. Government Printing

Office, Washington 25, D. C., $5.
Defense We Can Afford—James F.

Development

Avenue,

New

York

711 Fifth
22, N. Y.

(paper), 50£.

—

J.

Gregory

&

Threat
—

5, N. Y. (paper), $10.00.
Selection, Training and Compen¬
sation
<

of

Overseas

Managers—

Business
Fourth
N.

Y.

This

(cloth), $7.00.'

Leason

Sons, 72 Wall Street, New York

ica,

Bank

Economic

Russian

Is

International,
200
Avenue, New York 3,
(paper), $36.00.
'[ i

Japan

illustrated \

1959

—

annual

Lavishly
Japan

on

containing articles, color photo¬
graphs and black and white
photographs on ^ Japanese art,
industry politics,_ etc., $6.50 per
copy; in special cedarwood box,
$7.25 — Asahi Shimbun, Tokyo,
Japan — Foreign Subscription
Agency:
Japan
Publications
Trading Co., Ltd., Central P. O.
Box

722, Tokyo, Japan.

Distinguished Resorts,
1958-1959 (including rates, serv

Digest

of

have prepared

Richard M. Nixon will become
can
i

all

on

Companies

a

Report

comparing and evaluating

the spokesman for the Republi:

on

Projects

Energy

sheets

or

nomic
n g

(paper),

undertaken by power

Brownlee—Committee for Eco¬

men:

achieve

by
standing on the sidelines wring¬
ing. your hands and wondering
why someone doesn't do some¬
thing about a problem that di¬
"You

C.

Nuclear

role

a

Conserva¬
Raleigh,
request.

of

Department

Right to Work Laws:. A Study in
Conflict—Paul Sultan—Institute

publicly, is Mr. Nixon.

Between

5

the

N.

not coincide with

a

personal choice, while he would

J

party.
-

-

-

(Mjp.- Nixon^ who is not afraid
i

to|

J

Studebaker-Packard

responsible fov President Eisenr

speak

out,

is

probably

hower

taking the stump and
lashing out at "radical" Demo¬
crats in the closing days of this
campaign.
It : has
beenMr.
-f

j

|
•

:

Congress^ which they con,trolled
iielp to support that argument j
But' they had a great amount |
ot Republican support.
It is




wrant

the Democrats next week. Some

If

is

their candidate
for President, Mr. Eisenhower's
they

Democrats, and Chairman Butler

j

Boiled down to the hard, cold
facts is a great need for re¬
J

up

■r

.

;

may or may

and over again that it

be

\

J

he

out

probably have

the convention

traditional state of Vermont to

politi¬

cal camp, just as

series

whole

1;

Senator Humphrey and Senator
Javits belong in the

a

1

t

on

parently the most important do¬
mestic
issues
facing Congress

immediately. at

Green

j and

of Indus-

tion and Development,

Although he probably will

over

will

any

stake. One is
will the Republicans lose their

;

here

from

inee.

important Republican questions

stance, Senator Jacob K. Javits
from Senator George W. Malone

are

or

lie will

"Sleeper" State

the

in

Republican ranks. For instance,
Senator Harry F. Byrd of Vir¬

Rockefeller

[This column is intended to refleet the "behind the scene" inter! pretation from the nation's Capital
■

in naming the Republican nom¬

miles apart from
their

lina

!
;

,

substan¬
tial following, or whether there
will be any third party move¬
ment? It is entirely too early,,
party

—*

trial Development—North Caro¬

;

when

election,

etc.

Laws;

North Carolina—Survey

affects you."

"lame duck" chief executive.

keen over the big

third

Legislatures.

every

ernment

substantial influence, of course,

interest is
stakes from '*
New York to California, the ;
question arises in the Nation's -j
Capital: Will there be a "third j
party" in the 1960 Presidential ;
election? No one can say at this j
time whether there will be a'"

eral

40 seats in the House.

many as

1

.

almost

:

President Eisenhower will have

the Nov. 4 gen¬

before

Even

Tax

of
Chicago Press,
Ellis Avenue, Chicago 37,

111., $1.75 (one year's subscrip¬
tion $6.00).
>

Nowadays,
problem of gov¬
you.

should

land

but
.

■

affects

rectly

William F. Knowcapture the Cali¬
j fornia governorship, Mr. Nixon
will be the quarterback for the
'
Republicans until the 1960 Re¬
[ publican National Convention.
ernorship,

t

and

speeches

his

For

are

•

Even if Nelson B.

tee, who comes from Indiana,

are

convinced that the Republicans
are

of the
Commit-

National

Democratic

t

under

Contributions

Income

5750

should win the New York gov¬

Paul Butler, Chairman

!

Right or wrong, there appears
to
be no
doubt that a great

4.

the

going up!"

Economic An¬

University

1.

dent.

of

and

Costs

Research

Returns;

alysis

drop in this stock—my hair¬

(Northern- Wing).
Mr. Nixon has hurt the Demo¬
From a national standpoint, {•.■ crats, not only in the current
the
Northern
Democrats
are
campaign, but in past campaigns.
completely in control and will j
Nixon to Lead
name the next party nominees ;
'
v'
■ ■
/
for

"experts"

the

dresser assured me it was

Democrats

.

the

can't understand

Exchange

Floating

a

System;

the

toicking for GOP?

of

under

Republicans are probably .
closer together in Congress than rthe Southern Democrats and the

management are
discovering belatedly that they
are
suffering because of their
failure in the past to get out,
roll: up their sleeves and do a
little doorbell ringing of their
own. There are many people in
this country unsold on the profit

majority

1958,

^

;

and

Southern Democrats

The

Business and

system.

containing arti¬
cles on Monetary Reforms and
Monetary Equilibrium; Econo¬
mies
of
Scale
in
Financial
Enterprises;
A
Theory
of
Foreign-Exchange
Speculation

Northern Wing Controls

if not one.

Econemy,

Political"

of

October,

Social
'»

the

of

in

Embassy

Journal
.*■

with bigger working
majorities than they had before,
But it will not be easy sailing
for
them. The party is badly
divided on the national level,
and the breach may widen.

Democratic members of the

200

control

continue

will

ably

Section

the U. S.,
610 Fifth Avenue, Nqw York 20,
N. Y. (paper).

f

Russell-type—prob-

B.

and Vitality of
Coal Mining Indus¬

try—Economic
French

Congress,

supporting

probably

is

labor

Richard

!

Mar-f

seilles-Algiers;

.

,

the

at

Cable

Telephone

the French

good many of them are of the
Senator
Byrd
and
Senator

.

marine

v

*

.

political label he may be wear¬

_

j

articles on

Brussels World Exposition; Sub-

j
;■

However, the

.

Technical

Pavilion

French

the

{

ing for the first

'

Bulletin—Including

;

the Treasury

been

have

officials

—

and

Economic

French

working
overtime in preparation of the
big refunding and new financ-

and

ness

paper

—

Bank Merger, etc.

tax flows

not too much
into the Treasury.

year,

representing busi¬

sallis-Osake-Pankki,
Finland

to

fighting

is

toeing made in that direction in
the
Nov.
4
general election.
Many people

\

days.

autumn

is

step

a

full

just

Helsinki,
including
articles on Development.of-Fin^r
land's Foreigi* Tfdde after 4he
Devaluation; Butter as an Agri¬
cultural
Problem
in
Finland;

*.

big spending,
Treasury Department is J ;
the

of

; because

It

—

<

Review—Kan-

Economic

Finnish

C.

D.

WASHINGTON,

Los
/

California,

of

versity

Angeles 24; Calif., $1.25.

r-

Botany Mills
.

Copies

on

request

Nixon

who. has sparked, the
Republicans, and it is going fto
be
the
Vice-President
that
Republicans everywhere will be
looking to for guidance.
;

:

LEANER t W.
Investment Securities '

II Post Offict Sqvart,

,; [The higherups in the ■ Demo-

Telephone

cratic party do not like the Vice-

lUbbard 2-1090

President.

One

reason

-is

that

;

i
!

Boston 9, Mast,

E"

~

-"V

Teletype
MB

Volume 188

Number 5790

.

.

.

The Commercial and Financial Chronicle

PICTORIAL

1

Corporate Bond Traders Club of New York

Dick

Abbe, Shearson, Hammill A Co.; Herb Fitzpatrick, Dick
City Bank Farmers Trust Company; J. C. Blockley,

Ed Uhler, R. S. Dickson A Co., Inc.; Frank

A Merle-Smith; Barney
Harris, Upham A Co.

Welch, R. S. Dickson A
Co., Inc.; Stan Dawson-Smith, Cruttenden, Podesta A Co.

Tom

Dick

Miller,

McPhee, Drexel A Co.; Ed Bauman, Lee Rand A Co.; Bill Midgley, New
Company; jerry Ayers, Bear, Stearns A Co.

Albert

Rossner,

Company;




Goodbody
Tom

Neil

Brady,

Blyth

A

Co., Inc.;
Marks

A Co.; Frank Orlando, Good body
Feeley, Good body A Co.

York Life Insurance

Murray, Bankers Trust Company; Ralph Albanese, Bankers
William Cunningham, Bankers Trust Company

Weeden A Co.; James
Trust

Ginnity,

Frank

J.

Becherer,

A

Irving

Co.;

Trust

Allan

Philip

George Yook, Lazard Freres A Co.; Charles Zingrraf,
Co.; Ed Pereyra, Kidder, Peaibody A Co.

Laurence

M.

A

Harry Hair, Guaranty T.ust Company; Ed Nielsen, Lazard Freres
& Co.; Arnold J. Wechsler, Ogden, Wechsler A Co.

Company; George Bernauer, Bank of New
Co.; Bill Doherty, Fahnestock A Co.

York;

Allan

Kadell,

Kadell A

Byrne, Van Alstyne, Noel A Co.; H. C. Ballou, Shearson, Hammill A Co.; Gordon
Equitable Securities Corporation/ Edwin A. Clarke, Singer, Deane A Scribner

Phillips,

2

The Commercial and Financial Chronicle

PICTORIAL

.

.

.

Thursday, October 30, 1958

26th Annual Dinner

AI Moore, New York Hanseatic Corporation, Boston:
New York; Walter Kane, Shearson, Hammill

Louis

John Ohlandt, New York Hanseatic Corporation,
A Co.; John Reilly, C. H. Walker A Co.

H. Rand, Cowen A Co.; Charles M. Kaeppel, Eastman
Union Securities A Co.; Hal Murphy, Commercial A

Financial

Charles Walsh, First

Dillon,

Charles

Weigel, W. E. Hutton A Co.; Art Sachtleben, American Securities Corporation;
Schneider, Burnham A Company; Ray Pyle, Schoellkopf, Hutton A Pomeroy, Inc.

Boston Corporation; Ed Bauman, Lee Rand A Co.; Jim Crane,
Co.; Ed Whiting, Carl M. Loeb, Rhoades A Co.

Van

Alstyne,

Louis Voikomer, Stone A Webster Securities
Corporation; Vincent J. Mellin, Eastman Dillon, Union
Securities A Co.; Daniel J. Conroy, Jr., Morgan Stanley A Co.; Henry Kuipers, Lord, Abbett A Co.




Robert Rosenfeld, Stern, Lauer A Co.; Richard Schiffman, Stem,
Lauer A Co.; William Fleckner, Merrill Lynch, Pierce, Fenner
A Smith; Bob Towbin, Asiel A Co.

Bill Madden, Freeman A Co.; George Nelson, George Nelson Co.;
Charles O'Brien Murphy; III, Pearson, Murphy A Co.

Chronicle

Dan

Fay,

Goldman,

Noel A

Sachs

A

Mabon

(Jock Duffy,

Michael

Co.;
A

Dave Fitzgerald,

L. F.

Rothschild A

Co.;

Joseph

C.

Nugent,

Co.; Elliott Bliss, Morgan Stanley A Co.

Vilas A Hickey; Walter Huke, H. Hants A Co.; John Meyers, Gordon Graves A Co.;
Vincp Shea, Glare, Forgan A Co.

Number 5790

Volume 188

.

.

.

The Commercial and Financial Chronicle

PICTORIAL

8

October 17, 1958 at Hotel Roosevelt

•Herb

Joe

Stern,

L.

F.

Rothschild A Co.; Frank Moran, Vilas A H'ickey;' Ricky
Company; Paul Bruehl, Shields A Company

Hayes, Gregory A Sons; Jack Barker, Lee
ration; Bob Brearley, Wood, Gundy A
,

Higginson
Co., Inc.

Corpo-

Goodman, Shields

A

Bache

A

Co.;

George Watson, Parrish A Co.; Jim Sebold, Coffin A Burr,
corporated; Joe Scheidecker, Coffin A Burr, Incorporated

Kidder, Peabody A Co.; George M. Becker, Kidder, Peabody A Co.; Dick Williams,
Kidder, Peabody A Co.; Sam Weinberg, S. Weinberg, Grossman A Co.;

Reilly, Equitable Securities Corporation; Everett Rubien, Dean Witter A Co.;
Eastman Dillon, Union Securities A Co.; Joe Farrelt, Gregory A Sons;
Herb Wilson, J. P. Morgan A Co., Inc.




Aal,

Vin

Hurley,

Bache

A

Co.;

Bill Boothe,
Co.

Burns

Bros.

A

Denton,

Inc.;

Eddie Elkan, Cowen A

Richard Wigton,

Jack

Jerry

Bill Salisbury,

Les Barbier, G. A. Saxton A Co., Inc.; Harry Gunn, G. A. Saxton
A Co., Inc.; Walter 'Johnson, G. A. Saxton A Co., Inc.

In-

Bill McGovern, Blyth A Co., Inc.; Jack Barker, Lee Higginson Corporation; John Gahan, Schoellkopf,
v
Hutton A Pomeroy, Inc.; Eddie Elkan, Cowen A Co.

Jim

Philadelphia; William H. Steen, First Boston
Mundy, Suplee, Yeat man, Mosley Co., Inc.
"erb
Firs
poration, New York; Herb Tietjen, First Boston Corporation, New York; Bud Hardy,
First Boston Corporation, Philadelphia
—

-

-

-

-

Cor¬

4

PICTORIAL

The Commercial and Financial Chronicle

in

.

.

.

Thursday, October 30, 1958

Group's History
1

'C.-3?

%.

%
Wm :iM:

't-

f|

t

11

% 1
1

I

w

f

m
w

II
t

/

%

!

c>

.

i
Dick

Dunham,

John

Fitzgerald,

First Boston Corporation/ Nick Witte, First Boston Corporation;
Kean, Taylor A Co.; Ransom Berneburg, Wood, Gundy A Co., Inc.

Estabrook

Leoni

W.
A

C. Pitfield
Co.; Albert

A

Co., Inc.; Charles H.
Rossner, Weeden A Co.

Jann,

Frank

Andy

Mulligan,

Beyfuss,

Good body A Co.; Lou Zwahl,
Larkin, Goodbody A Co.

Tuzo, Tricontinenttd Corporation; Lee J. Rand, Lee Rand A Co.; Sy Fabricant, Wertheim A Co.;




Stephen, Vilas A Hickey

Meyers,

Gordon Graves A Co.; Paul Lane, Kidder, Peabody A Co.; Herb Fitzpatrick,
Merle-Smith; Frank J. Ron an, New York Hans eatic Corporation

Mabon

A

A1

Co.

Tom

Dorfman, Goldman, Sachs A Co.; Frank Verian, Merrill Lynch, Pierce, Fenner A Smith; Joseph
Cabbie, Burns Bros. A Denton, Inc.; F. W. Robson, McLeod, Young, Weir, Incorporated

Francis J.

Bill

Ray

Wildey,

Baker,

Weeks

A

Co.;

Weeks

Leo

Richard,

A

Dick

A

Tisch, Fitzgerald A Company; Ed Kelly, Carl M. Loeb, Rhoades
A Co.; Stanley Roggenburg, Roggenburg A Co.

Rollie Gunther, Baker, Weeks A Co.;
Co.; Harold G. Kelly, Vilas A Hickey

Clarence

Nelson,

Baker

,

Hcdsey, Stuart A Co.; John McCormack, F. S. Smithers A Co.; George Brounoff,
Co.; Vic Garbe, Morgan Stanley A Co.; Richard Walker, Vilas A Hickey

Lee Rand A