Full text of Commercial and Financial Chronicle : October 5, 1944, Vol. 160, No. 4322, Section 1

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Final

Edition

Sections-Section

YEARS

OVER 100

ESTABLISHED

tit*.

UMAW

ommetciaI

Iieg. 11,

S. Pat. Office

60 Cents a

Price
New York)

Number 4322

160

Volume

Bureau

•Warren

Position Of

September 25, 26 and

and

mary

of many
public

\ *

Calls Attention To Growing Threats To Indivi¬
Of Technological Developments Aid Government
Action.
He Sees Danger In A Continuation Of
Deficit Financing
Iu Use Of Public Funds As
Benefit To Special Classes—And In Government
Competition With Private Business.
Holds Solu¬
tion Is A Proper Balance Between Freedom Of
Action And Governments Dictates And Condemns

Retiring ABA Executive
dualism Arising Out

conclusfon

the

that the Unit¬

•«,—c

States

lagging
behind

the

United

King¬

dom

post¬

planning.
•According to
many of these
war

ates Under The

Agency As Leading To The Use Of Banking
sources For Social And Political Objectives.

blue¬

British

the

for

post-war

The

Thomas R. Wilson

world is com-

plete

British

Sept. 15,

its

1944.

(Continued on page 1498)

M. Wiggins

address

♦An
War

requires the recognition of the

Wiggins before the First General Session of the Second
Americart Bankers Association, Chicago, 111., Sept. 26, 1944,

Mr.

Service Meeting,

(Continued

Interstate
Aircraft & Eng. Co.

on page

1486)

NEW YORK

Buy War Bonds

the meet¬
ing by prominent figures in inter¬
will
found elsewhere in the ''Chron¬

national and national finance

not

STOCKS, INC

Index
page

Association's

on page

Regular

1500)

Features

1502.

State and

Municipal
Bond Brokerage

Bonds

Service
for Banks, Brokers
and Dealers

R. H. Johnson & Co.

Exchanges

'.London* Geneva

Rep.

25 Broad St., New

Bond

64 Wall Street, New

Teletype NY 1-210
.

SECURITIES

INVESTMENT

York 4, N. Y.
Cleveland

WALL STREET

Department

LOS ANGELES 14

Members New

New

York Curb Exchange

THE

CHASE

York Stock Exchange

Members

New York 4

30 Broad St.
Tel. DIgby 4-7800

NATIONAL BANK
OF

THE CITY OF NEW YORK

Tele. NY 1-733

A
Markets,

Trading

always

Philip Carey

Midland Utilities

Manufacturing Co.

6s of 1938

Central Soya Co;

RAILS

COMPANY

634 SO. SPRING ST.

NEW YORK 3

ELECTRONICS.

BROKERS

LONG and
INCORPORATED

Syracuse
Dallas

Actual

BOND

HUGH W.

York 5

Albany
Buffalo "
Pittsburgh
Williamsport

Troy

PHILADELPHIA

BOSTON

Hardy & Co.

Prospectus on Requesr

Established 1927
'

;

the

(Continued

Stock Exchange

Members New York,

Chicago

Meetings

possible to include all in this
It is hoped that in future

Hirsch, Lilientha! & Co.

HAnover ?-<N;00

possible to print

these also).

issue.

victory

other

Council.

for

and

issues it will be

ports of the speeches at

Waller

of the prob¬
icle," which regrets that because
world revolution that has of severe space limitations it is

A correct analysis

difficult a current appraisal.

make

lems ahead

Association^

problems facing the
country in the post-war era, and
discussed matters of national and
international fiscal policy.
(Re¬

conferred

Association at the meeting of the Executive
completed one term as Treasurer.

The members of the

crescendo of the war in Europe
early ending.
This imposes the

necessity upon us to face calmly, real¬
istically, and courageously, the situation both
nationally and internationally that is now before
us.
The moving events of world history and of
national life in this country within, recent years

Foreign

Commerce

Mr. Waller had

urgent

delivered by Mr. Wilson, be¬
Trade Clinic on the
Empire, Los Angeles Chamber of

the

Treasurer of the

Re¬

Wihaer

Frank C. Rathje

W. R. Burgess

rising

indicates

lines and only

major

♦Speech
fore

So-Called Streamlined, Unified,
Of Banking That Oper¬
Sole Jurisdiction Of One Bureau Or

The

Federalized Single System

the

speakers
print

Particularly

and

writers

Bankers Association
Hartsville, S. C.

President, Bank of Hartsville,

'addresses

•

WIGGINS*

Retiring President, American

recent

one

By A. L. M.

sum¬

leads

<$>

Dangeis Mead En Banking

Balances.

of the American press

A survey

of the Board of the National City Bank
American Bankers¥ Association at the closing

elected President of the

general session of the Second War Service Meeting held in Chicago
27. Mr. Burgess succeeds A. Lee M. Wiggins, President of the Bank of Hartsville, Hartsville, S. C., as head of the A. B. A.
A
Other officers elected were: Frank C. Rathje, President of the Chicago City Bank &
Trusl; Company and of the Mutual National Bank of Chicago, Vice-President. Wilmer J.
Waller, President of the Hamilton National Bank of Washington, D. C., was re-elected

United Kingdom "Will

Working

Normal

And

Division Officials Chosen

Randolph Burgess, Vice-Chairman

of New York, was

Department Official

Financial

Other Officers And

Contends That Unfavorable International
Make It Quite Impos¬
sible For Them To Give Concessions In Commercial Policies Without A
Quid Pro Quo." Finds Also That Preservation Of "Sterling Area" And
Existence Of The Blocked Balances Are Other Obstacles To Preference
Removals. Reminds Us That AH Of These Balances Are Not Abnormal
For Prior To War These Areas Maintained Sterling Balances In London
Of Appproximately £250,009,000^
~
Representing Currency Reserves

Commerce

At War Service Meeting in Chicago;
At ABA Sessions.

Randolph Burgess Elected President

Chief, British Empire Unit,
of Foreign and Domestic Commerce

MEETING

70th ANNUAL

WILSON *

By THOMAS R.

ASSOCIATION HOLDS

AMERICAN BANKERS

Imperial PreferenceAnd Other
Factors In Post-War Trade
With The British Empire

Copy

October 5, 1944

N. Y., Thursday,

International

INDUSTRIALS

Detrola Corp.

Bull, Holden &
MEMBERS NEW YORK

14 Wall

C°

STOCK EXCHANGE

Sr., New York 5, N. Y,

telephone-rector 2-6300

Kobbe, Gearhart & Co.
.

Members N.

INCORPORATED

Security Dealers Ass'n

HART SMITH & CO.
Reynolds & Co.
Members New York
120

45 Nassau Street.
Tel.

REctor 2-3600

New York 5

Teletype N. Y. 1-576

Philadelphia Telephone:

Enterprise 6015

Stock Exchange

Broadway, New York5,

Telephone:
Rpll

N.Y.

REctor 2-7400

Teletype. NY

1-635

IRA HAUPT & CO.

Members
New

York

Security

Dealers

52'WILLIAM ST., N, Y. 5
Bell

New

York

Teletype NY

Assn.

HAnover 2-0980
1-395

Montreal

Members of Principal

111 Broadway,

Toronto

REctor 2-3100

Exchanges

N. y. 6

Teletype NY 1-1920

THE COMMERCIAL &

1458

FINANCIAL CHRONICLE

Thursday, October 5, 1944

Trading Markets in:

NORAKDA

National Airlines

MIJIES

BUL0L0 GOLD DREDGING

Maguire Industries
Mid-Continent Airlines

BROWN CO. 5s,

Established 1920

Members iV. Y. Stock

Dealers

Security

York

New

Members

Ass'n

'59 Com. & P'f'd.

BArclay

Telephone

''•"■.A":''

Teletype

Professor

4's & Stk.

1-672

& Vending

N. Y. 5

WOrth 2-4230

Teletype JV. Y. 1-1227

Bell

REctor

Finance, New Ycrk University

R.. S.

Direct wires to

2-7815

Power Securities'

the

From

the

investments

<and

Savoy Plaza

banks

before

ever<$

—

;

with

Dunne

L.H.Gilmer

Aeronca

was

ice department of

& Treat.
;■

Nu-Ename!

In the past Mr. de Mitkie¬
in the institutional serv¬

ment.
wicz;

£.

■

Baker, Hughes

;

Edward A. Purcell & Co.

;=-v-

rnmssmm

—

Members New York Stock Exchange
Members New York Curb Exchange

flew Abraham

Depl.
Her Sidney Winters

Curb Exchange

Abraham & Co., 120 Broadway,
York City, members New
York Stock Exchange, announce
thatvthey. have established a De¬
>

Central States Elec.
*5%

partment of Research in Public
Utilities under the management

New York 5

31 Nassau Street

Teletype

System

Struthers Wells

H. G. BRUNS & CO.

and that

securities

the

New York 5

their

war

government

the end of

holdings

There is

these

of
a

not so much economic as

1-1843

of reconversion.

political

hostilities

end

inevitable

its

Exchange

NEW

YORK

HAnover 2-9470

with,;;'

the peace. .We

and

will be

breeneoaCompcmu

the

time

matter:

would

even

millions

want to

pluses. U'

■;

Finally, many if not most of

One

the

most

trouble¬

some

aspects

their gov-

problem is the

♦An address by Dr. Nadler be¬
fore
the
Second
War
Service

Burden

"*'

will want to fly after the

women

They have heard that public
Opinion surveys show that a sig¬
nificant number of our citizenry

war.;;

own

FAltll & CO.

be the

$1.60 Preferred

York.

New
New York

Stock

Exchange

Coffee & Sugar Exchange

120 WALL

major future safeguard of

national security.

ST., NEW YORK

SUGAR SECURITIES

But, the public does not realize
the wonderful promises of

that
V

"•

■'

■

; •'

v '

Quotations Upon Request

;

public's inadeT

corny y

quate-.

•

* An. address by Mr, Burden be¬
TEL. HANOVER 2-9612

prehension of just" how serious' a fore the Dinner Meeting of the
National
Industrial
Conference
meeting of the American Bankers dilemma the industry faces.
Board,
Waldorf-Astoria
Hotel,
Association, Chicago, 111., on Sept.
Americans readily believe that New: York
City, Sept. 21, 1944.
25, 1944.
we are
living in an Air Age. The
(Continued on page 1492)
(Continued on page 1468)

Buffalo, Niagara & Eastern Pr.

Members

and operate a plane.

are-convinced that Air Power will

our

of the aircraft
reconversion

NY 1-10261

and

men

our

Broadway, New York 6, N. Y.

BArclay 7-0570

They know, too, that thousands
and

surf

we re-:
convert - o u r

Ill

convince

useable

wisely,

Wm.

1127

request

vincing..

• no
o w

Pacific

the

salvage

Hanover 2-4850

.I'1 ' X,

F. H. Koller & Co., inc.

occuring each day in Europe

facilities

banks in exchange for

Y. Security Dealers Assn.

them of that if they needed con¬

paying

that bill; for

through sleight of hand measures
primarily at the expense of the
banks. The suggestion has already
been made that after the "war the
Government
turn
over
to
the

Wickwire Spencer Steel

Clay Products

Indiana Limestone 6s, 1952
Memoranda

demonstrations of Air Power that
are

Undoubtedly efforts will be made
to
alleviate
the* debt
burden

Triumph Explosives

Company

destruction

about 6 billion dollars per annum.

Preferreds

1-1126

with

war

while we build

Hong

the

waste

public debt of the United States
may amount to about 300 billion
dollars, entailing a debt service of

New England Public Service

St., N. Y. 5
Teletypes—NY

The

be
'

disposal.

Shovel

•

of wealth wilP*>

character, which the banks
ought to consider now and com¬
bat with every measure at their

Preferred

Bell

Great American Industries

magic formula which.will sugar coat the hard facts

danger,

created

further, have

Federal Machine and Welder

37 Wall

Exchange

York Curb

ST.

Laclede Christy

obligations' are bound to increase

Telephone: WHitehall 3-1223

Members

WALL

The Cross

—Urges Maintenance Of Adequate Air Force, A Contin¬
uation Of Research, Expansion Of Domestic And
Foreign
Air Transportation And
Training Of Flyers

large

investments of

Steam

New

Members
64

Teletype NY 1-1140

portion of thq

Dr. Marcus Nadler

the banks consists of

Marion

dtrb

Frank C.Masterson & Co.

Surplus

the;

that

very

Common & Preferred

York

New

Planes Will Retard Aviation Growth As After Last War

individual

However,

1936

Teletype

Assistant Secretary of Commerce

Despite Our War¬
Achievements We Are Only In The Early Stages Of
Aircraft Development And Expresses Fear That

re¬

institution.1
facts

Bell

•

quirement's of time

1952

the

20 Pine Street,

*Dealt in

the

meet

(Va.)

Debentures
Preferreds

Mtge. Guar, Com. & Pfd.

Government Aviation Expert Points Out The Serious
Problems Facing The Aircraft
securities well'
Industry When War Ends
diversifed
as
—There Will Be The Difficulties Of
Surplus Plants, And
tof maturity to Contract Terminations-—Holds That

St. Louis-San Francisco
6s,

BURDEN*

government:

1-1548

Indiana Limestone
Income 6s,

And Air Power

banks

consists

7-4070

Telephone COrtlandt
Bell

the

S\z %

Amsrican-LaFrance Com.

of Sidney R. Winters.

By WILLIAM A. M

earning assets;

Curb Exchange

York

New

Members

Common

Nat. Commercial Title &

t h e

age

in1 the

country.; A;
large percent-'

Vanderhoef & Robinson

WHitehall 4-8120

New

history of the
Y.

Broadway

Bell System Teletype NY 1-1919

—

Company

Mitkiewicz, formerly
War Department, has be¬

25 Broad* Street, New York
City, in their new business depart¬

liquidity and soundness of their loans
today are in a stronger position than

perhaps

3/6s, 1956
N.

branch offices

our

Southwest Natural Gas

Co.,

Play j In The National Economy.

standpoint of

Adds

associated

come

Essential Role Banks

6^2s an^ 7s

NY 1-1557

Orleans, La.-Birmingham, Ala.

with the

Treasury Refunding Operations, To Assist In Keeping
Interest Rates Low, And To Meet Aggressively^ All
Legitimate Loan Needs Of Their Customers.
He
Advocates A Program To Educate The Public On The

*International

? Traded

St., New York 4, N. Y.

HAnover 2-0700

New

B. S. delitkiewcz

Danger Of Political Control Of The Banks. To Avert
This, He Urges Bankers To Adopt Measures To Aid

Baltimore Stock Exchange

120 Broadway,

Tel.

Contending That From The Standpoint Of
Liquidity And Soundness, Banks Are In A Stronger
Position Than Ever Before, Dr. Nadler Points Out That
Large Holdings Of Government Securities May Create

111)
Members

Exchange

BROADWAY, NEW YORK

120

While

Preferred

25 Broad

New York Curb Exchange

Economist, Central Hanover Bank and Trust Company, New York

Mayflower Hotel
Common

Stock

By DR. MARCUS NABLER*

Kearney & Treckfer

Peerless Weighing

York

jtame

Coal, Com. & Pfd.

La France Industries,

Quoted

Members New York Stock
Exchange

Members

)■

New

Bohack, Com. & Pfd.

H. C.

—

1-423

BHXiXI TELETYPE NY

Elk Horn

Sold

Steiner, Rouse & Co.

MCDonnell

NEW YORK 6, N. Y.

7-0100

Bought

Pref.

request '

Bought—Sold—Quoted

Exchange and Other Principal Exchanges

115 BROADWAY

HA 2-2772

Exchange PI., N.Y. 5

Conv.

Goodbody & Co.

KING & KING

Analysis

CORPORATION

ABITIBI P. & P. 5s '53 B'ds & C.D.s Com. & P fd

Amer. Furniture Co. Com.

P. R. Mallory & Co. Inc.

CARRIER

Teletype N. Y. 1-2123

Mountain States Power
Common

Preferred

Henry Holt & Co.

FASHION

New England Power Association
$2 & 6% Preferreds

Makes men's clothes;
"Fashion

Northern States Power
6%

Park", etc.

Heilbroner.

Preferreds

everywhere.
lem.

Northeastern Water
AH Issues

Also

"Stein Bloch",

* to

for

our

dealers

detailed

should

G,A.Saxton&Co.,Inc.
170 PINE ST., N. Y. 5

Teleytpe NY

WIMehaU 4r4970 1

1-869

25 Broad

Exchange

St., New York 4, N. Y.

HAnover 2-0600

Tele. NY

1-210

$5 Cumulative Pfd.

Wm. J. Mericka Cr Co.
Members N.

Security Dealers Ass'n

Trinity Place, N. Y. 6 HA
Teletype NY 1-376-377

Private

Wires to

Detroit

Corp.

far 1944

Buffalo

Pittsburgh

Members

Union

Louis

Cleveland

Commerce

Stock

Bldg.,

Exchange

Cleveland

Telephone MAih 8500

2-2400
.

Broadway, New York 0
WHitehall 4-3640

Cleveland

St.

BOUGHT, SOLD & QUOTED

INCORPORATED

Troster.Currie&Summers
Members New York Stock

(TO
,

Diamond Alkali Co.

$3 Paid;

report.

Simons, Unburn & Co.

Bakeries

A, B, C, & D Preferreds

send

$7 Preferreds

Interstate

1969

Boston & Maine Railroad

$5 Paid in 1943

prob¬

due

$1.60 Preferred

retailers

Attractive postwar outlook.
investment

Buffalo, Niagara & Eastern

Crane & Hoist

Owns Weber &

sells

reconversion

All

Utah Power & Light

Shepard-Niles

PARK, Inc.

•'

Direct Private

Wire to Cleveland

%/u%, ¥
<JJo*re if-•

MEMBERS NEW

One

Wall

YORK STOCK EXCHANGE

Street,

New

York

N. Y.

itV-liy, *

COMMERCIAL & FINANCIAL

THE

Number 4322

Volume 160

CHRONICLE

Publishers

National Radiator

AND COMPANY

William D. Riggs,

Chicago Ry. Equip,

Thursday,

Editor and Publisher

William Dana Seibert,

>',ij

...

Seib'ert,

•

Public

York 8

BEekman 3-3341

Herbert D.
•

every

Business Manager

encer

;7>.

STRAUSS BROS.
Members

New

York Security

Dealers Ass'n

Board of Trade BIdg.
CHICAGO 4

Broadway

NEW YORK 4

Harrison 2075
Teletype CG 129

DIgb.v 4-8340
Teletype NY 1-832, 834

135 S. La Salle St.,
(Telephone: State 0613);;

Offices:'

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

Our Real

Estate

1944 by William

York,

TITLE COMPANY

CERTIFICATES

Members

New

40 Wall St.,

York

Stock Exchange

WHitehall 4-6330

N.Y. 5

Bell Teletype

NY T-2033

United

States

and

in Dominion
of Canada,- ,$27.50 per year;
South ant.
Central
America,
Spain,
Mexico and
Cuba, $29.50 per year;
Great Britain.
Continental Europe (except Spain), Asia,
Australia and Africa, $31.00 per year.' V
' f

Other Publications

Bank and

qewburger, Loeb & Co.

Possessions, $26.00 per year;

for quotes

at New
March

7 >"7

Subscriptions

Record—Mth.. .$20 yr.

fluctuations
in the rate of exchange, remittances -for
foreign subscriptions and advertisements
York funds.

■

V; [■

last

ses-

of the

o n

convention, or;
w a r
confer¬

should; su g-..

that

gest

PHILADELPHIA, PA., Oct. 3.—A group of:repreT
sentatives, upon the • invitation of the Securities and; Ex;
7 change Commission, met here today for the purpose of con| sidering an educational campaign which would protect the
I $21,000,000,000 of liquid funds and securities now owned by
the public.
•
7
Y
- ■■% -rY.-'-.Y
This program, it was declared, is intended to instruct the
.public market wise and make the investor less vulnerable to
the schemes of dishonest dealers in securities.
Yy;'/
The meeting was, called to order by Ganson Purcell,
Chairman of the Securities and Exchange Commission, who,
ctfter reading from a prepared speech of welcome (given fuH
ther below) setting forth the purposes, turned the chair" over
to James A. Treanor, Jr.:, Director of the Commission's Trad¬
ing and Exchange Division.
77;
■
.
■ i

sober

.we
or

toxicated?

■

opinion of those present was >that,
i owners of Government "E" Bonds should hold those securif
ties because a general turn to immediate redemption would
J present to our Government the prompt need for,; issuing
new. securities
out of the proceeds of which UE" Bonds
could be paid, and for the further reason that in the opinion
; of the conferees, these bonds constitute the safest investment
for.the public.
X-1'Y'Y^'r-^y'YY y\y
-;:7'
:
Bernard Reis, for the American Investors Union, con¬
tended that the program of education, as it related to the
/ retention of Government securities, was one for the Treasury
Department.
7/; yY;;-—'• YYY Y- Y'-YYYY:'YY7'YYyYy, Y y'i
Mr. Treanor said the field was considerably larger since
many billions in liquid assets were in banks and in invest;

these

■*7 '

reason

face today are
need to focus public

Teletype NY 1-1203

Liberty Aircraft
^Mid-Continent

^National Airlines

^Northrop Aircraft
Rohr Aircraft
Bought
*Circular

•—

Sold

Request

J.F. Reilly & Co.
Members
York

Security

Dealers

Assn.

Ill Broadway, New York 6, N.Y.
'

REctor 2-5288
Bell

System

Teletype.

Private ' Wire

Los

1-2480

Angeles

1475)

Gisholt Machine Co.

Haloid Corp.

Laelede-Christy Clay Pr.

not

cal talk about

if / t
on

were

h e

•

heads

than Government bonds.

of
'.

f •

President of the New York

Avoided

MUST do.

series

the

-;uch as:.,.

r/reassur¬
that

ance

"The

there is. really

Haytian Corp.
Punta Alegre

In ring¬

what we
whole' technique
of clever catch-words—
; ■.7
]/.■■ 1
/
Their

fangs

"America

sun*

and-

the

Eastern

Sugar Assoc.

Merchants Distilling

aggressors

must maintain peace

v 7

justice."

,.7

DUNNE & CO.
Members New York Security Dealers

Senator
Wheeler'over the Columbia net¬
*A

had
to
grapple
with
all
the prob¬

work

that trouble us today.

Dealers Committee, Messrs. Edward
Abraham M. Metz urged that education of the

Ass'n.

COrtlandt 7-6190
Teletype NY 1-84

and woman.

men

edly

lems

170 Broadway
Bell System

must be drawn;"

new.

repeat¬

have

E,t 1926
York Security Dealers

comprehension

the
adopted a new formula:
ing phrases they tell us
ing

under the

Hiriog
Members Neio

who are instruct¬
American people have

tory brings us

—t hat

throw up our
whole sub¬

Bought—Sold

Many of those

reading of his-

nothing,

problems it is

of the ordinary man

ordinary
Americans;

Miller Mfg. Co.

Segal Lock & Hdw. Pfd.

and admit the

ject is' beyond the

some

plane a b o v e
the

necessary

hands

.affairs

world

Federation

alarmingly serious. For that
attention on them.; There is

To deal with our

pontiff- 7

much

change,
an educational program for some time.

radio

address

Sept. 26, 1944.

Assn

Broad St., New York 4, N. Y.
Tel. WHitehall 3-0272

;

(Continued on page 1497)

the Securities

A. Kole and

desirable, 1 They contended that the secure
ities enforcement agencig| appeared as special pleaders in
'this conference. In their opinion, education had better be
left to the Treasury Department and the National Associa¬
tion of Better'Business Bureaus, which guards against all
types of fraud. Mr. Kole also indicated that he felt there
was danger of creating suspicion Jin the public mind regard;
Ing the integrity of dealers,; thereby interfering with the rais¬
ing of capital in the post-war era and the creation of em¬
ployment opportunities. A similar warning was voiced by

PANAMA COCA-COLA

public is always

HAnover 2-8970

-Peace

Diplomacy And Advocates

altogether too

Stock Ex¬
reported that his organization had been carrying on

Broadway

Bartgis Bros.

The problems we

* For

New York 6, N. Y.

States As Best Guarantee Against U S. Involvement In
Urges More Control By Congress Over Foreign Policies.

Of European
Their Affairs.

CO!

York,Security Dealers Assn.'

Members New

Democratic Senator Scores Secret

lntormation

J. COLDWATER 8

By HON. BURTON K. WHEELER*
U. S. Senator from Montana

Unwarranted Suspicions To Be

Mr.

(Continued on page

appropriate for your

Emil Schram,

Stetistical

Federal Screw Works

The consensus of

ments rather

QUOTED

However we
phrase the

remarks it is

which

themselves,

Weisman
before the Savings Division at the
Second
War
Service
Meeting,
American
Bankers
Association,
' 7' Chicago, 111., Sept. 25, 1944.
by

address

*An

;

Complete

New

remain in¬

title

SOLD

...

they can plan best for

Shall

to:

title

BOUGHT

sideration to the means by

WHitehall 4-6551

Airlines

bankers to give serious con¬

all

the

change

Securities. Dept.

CERTIFICATES

* \,77 7'•
period of plans and plan¬
ners
certainly it is in order for
savings bankers and, in fact, for

ated. ■;

instead

ence,

of j the first,

Hold "E" Bonds

TITLE COMPANY

;

composed largely of sav¬
ings
bankers,
to
give
some
thought to the processes by which
what we hope will prove a sound
post-war economy shall be cre-<

;/7If this were

Education Of Investors

Public Advised To

se¬

It's

group,

prosperity?

traded

junk.

WALL STREET, NEW YORK

program asked me to address my
spend or save our way to a sound
<§>

t -/w a r

p o s

the

}■■■

Cleveland, O.

Plain Dealer,

Yoqr committee in charge of
remarks to the question; Shall we

NOTE—On account of the

must be made in New

the

Wide Acceptance Of The Economic
Than Saving Is The Way To Prpserify, As Exemplified By The Federal Government's Spending Policy/Of
The Last Decade, He Urges Immediately The War Is Over A Policy Of
Savings As Against Spending By Both Government And Individuals Be
Adopted. Maintains That Issue Of Series E Savings Bonds As "Demand
Obligations", Tends To Create An Enormous Burden Of Floating Debt
And Threatens The Post-War Economy.
Favors Higher Interest Rates
And Long Term Bonds As An Encouragement To Thrift.

Quotation Record—Mth. $20 yr.

Monthly Earnings

buy

Telephone:

Newspaper Editor Condemns The
Philosophy That Spending Rather

matter Feb¬

25, 1942, at the post office
N. Y., under the Act of

RUSSELL WEISMAN*

Associate Editor, Cleveland

Dana Company

Reentered as second-class
ruary

E. C., Eng¬

3, 1879.

Specializes in

Call

ceme

rarely

that!

Spending Or Saving Our Way
T@ Post-War Prosperity

(complete. statistical issue—market quo¬
records,
corporation,
banking,
clearings, state and city news, etc.) i . i

Chicago 3, 111.

simple

NY 1-1

;

business—clients

and

issue) s;

Monday

Securities Department

Members New

country

Obsolete

\ Teletype
York Stock Exchange

Telephone HAnover 2-4300

the

obsolete

curities.

York

25 Broad Street, New

tation

Other
.

Trask & Co.

how

over

sell

Thursday

and every

MY WAY
Here's

all

1944

(general news and advertising

SHOWING

1 >•

President

October 5,

High Grade
Utility and Industrial

PREFERRED STOCKS

Published twice a week

Pettibone Mulliken

licHifnsitiii

B. S.

interested in offerings of

are

■

„

25 Spruce Street, New

H. H. Robertson

William B. Dana Company

Amer. Window Glass

1459

CHRONICLE

Patent Office

Reg. U. S,

^'|^'^^Ji^i-itffWV.*tWl»wi(r»«J-- fa*

COMMERCIAL and

The

FINANCIAL

Amer. Furniture

1*V'flVty (5&*

Dividends declared 1944 to date

»\

*(Continued on page. 1501).^

Circular

Public National Bank

$2.75

3.65

Third quarter

available

analysis
request

request

C. E. Unterberg

Hon, Rose STrqster
•

& Trust Co.

$4.50

Approximate selling price

vyt

1943
1942

Dividends

—

Fstnblished 1914

Members New
.

Trinity Place, New York 6, N. Y.
Teletype: NY 1-375

Telephone: BOwling Green 9-7400

& Co.

York Security Dealers

Assn

New York 6, N. Y.
^'Tptephone BOwling Green 9-356S

61 Broadway,

Tel,,.™,,

1-1666

1460

THE COMMERCIAL & FINANCIAL

CHRONICLE

totqt* w'mi vy^r*^eMMy.

Thursday, October 5, 1944
BOSTON, MASS.

Art Metals Construction

Oxford Paper Com.6- pfd.

Crowell Collier

Stromberg Carlson

Com

Magazine Repeating Razor Warren Bros. B. & C.
Bought - Sold

Quoted

Railroad

Goodbody & Co.:
Aetna Life

115 BROADWAY

NEW YORK

Alabama Mills*

TELEPHONE

•

Employees Pfd.

7-0100

TELETYPE

Auto Car

INC.

WHitehall

1-672

SOLD

& Pfd.

;

$3.00 Preferred
Common

Gisholt Machine
Hart Carter

HODSON &

Common

Merchants
Moxie

Nu-Enamel 77'".'

Scoviil

Title Guarantee & Trust

Auto

Window Glass,
Car

Axton-Fisber

Common

Preferred

CHICAGO 3

Common

135 La Salle St.

165

Bird

"B"

Paul Andersen Is

New York

Boston

Milwaukee

Post

the New

York

change,

"Post-War

"A"*

Crowell

Collier P.

Eastern

Corporation

Federal

Machine

Com.

that

announce

Amer.

Machine, Pfd.

Industrial

Brownhoist

Interstate

Bak.

Com.

Pfd.

Com.

Oxford

Herrington
Paper

■

Pollak

Manufacturing
Punta. Alegre Sugar
Remington Arms

Ta'on

Textron

Bonds, Pfd. Wrnts.

Tokheim* Oil
United

Tank

Drill

United

"A"

Sugar 6s

some

President

Harmschfea:er

Corp.,

Milwaukee, Wis.

have

Here,

again, I
in
increased

tion

National

and
I
sub¬

man,

stantia

Airlines

with

UTILITIES

c o

1,1 y,

Gas

American

Power

Wrnts.

Utilities Service Pfd.

reactions

will require

Com.

Cons.

Elec.

Gas Pfd.

-• *

Derby

Gas

Electric

■

;y'
7

Nassau

Lt.

& Suffolk

$2 Pfd.*

ness

Ltg. Pfd.

New Eng. Pub. Serv. 6% &
Y. Water Service Pfd.

Peoples Lt. & Pwr. w 7
Puget Sound Pr. & Lt.
Queensboro Gas & Eleci .Pfd.
Scranton

Southwest

Natural
Pub:

Gas

Serv.

General

Detrola

Circular

;
Personally,- I

H&rnischfeger,;

somewhat

- am

/
"

these agreements were signed.
As the matter of taxation has

considerable

bearing on costs, I
prompt attention should
be given to revising the tax pro¬
gram to enable industry to pro¬
believe

Request

duce at

profit -of * sufficient

pro¬

portion to enable it to expand into
new
lines,
thereby taking
up
Whatever slack there might be in'
the

regular

lines..

The

Renego¬
tiation Act, which is confiscatory
in practice, is one of the' great
obstacles
120

Y. Security Dealers Assn

BROADWAY,' NEW YORK

REctor 2-8700
Direct

wires

;«vw

6111

Boston

ENTERPRISE
Hartford

nostrums

who

not

ment.--*

*:»v

that

'PHONES
Buffalo 6024

the

matter

ing steady employment.

1-J28F
Phiia.''

insur¬

Its effect

retard

progress, and
as a
result will bring about unemploy-

[
.

ST. LOUIS

v*'V" ■7^- yyy

partne r s.lu p
with Ralph W.'

Stt^"
4'

{' *"■

♦

;

Halsey ' under

investment^

securities

509

the time Mr. Andersen

STREET

OLIVE

St. Louis 1,Mo.

r/..r.;

Mr.- Andersen
was

pre¬

"Chron¬

; ;

Members St7 Louis Stock
Exchange

;

there

third

York

New

Oct. 8, and

The

ation, War Contract- Termination,
and various other subjects
relating
to Internal Auditing and post-war

problems."

17^

annual conference of

7. ". :.'7"7*/:7'•

Vice-President

the ; Central

Sunday

evening,

chairman of the Conference, with

will continue through Phillips;a Salman,;> director of

Tuesday, Oct, 10.. RepTeseniatiVe the. lnstitute and General Auditor
of thie gathering will be prominent of the Socohy-Vacuum Oil Com¬
executives in the .industrial, bank¬ pany, Inc.f nf ; New York,
viceing'and insurance, public utility general chairman. 7" ' 7 •'*
" 1
and accounting fields.
,7,

Poisschine In Research

Dept. Of Cok & Torrey
Cohu

Torrey, 1 Wall Street,
.York City,
members New
Stock Exchangej announce

New
York

that

Ivan

Pouschine

has

become

associated - with them in their re¬
search

eight
been

department.
years

Mr.

connected

For the

Pouschine

past
(

has

with Wainwright

Co.,

and

With

as analyst and economist,
previous to that time he whs

Bonbright & Co.

J;;

Now Fred. Robinson & Go
The

firm

name

Robinson,

reception will be held on
Sunday afternoon and will be fol¬
lowed on' Monday evening by the

C. A. Alberts Member Of

Third

meeting of the Board of
on Sept; 28, 1944,
Chester A. Alberts, C. A.. Alberts
New York, was elected to

Annual

William

Dinner-

which

Garbade, .President of
the Institute and A.ssistant Tre^surer
of the Shell • Oil Compaiiy,
Incorporated, will preside. '* Jack
Nichols',. Vice-President in charge,
of international development of

the

Transcontinental

-iTnternatioTial Aviation.'' ^

In:

following

'session^,

•

<; t 7

Governors held

rjieinbership in the Association.»'

Brownhoist Interesting

Western

Air, Inc., who will be the guest of
honor, will. give -particular* and
general significance to his views
on

NY Security Dealers Ass'n

Industrial Brownhoist first

ferred
ities

pre¬

offers .interesting possibil-

according to

analysis

new

being distributed by Grillis-Russell

& Co.j Union Commerce; Building,
Co., Inc., 52 William will be. read by prominent men of
Copies of this
Street, New York City, has been industry and finance and discus¬ Cleveland, Ohio.
ity at the present time in the mat- changed to Frederick S. Robinson sion will take
place On The Mod¬ study may be had from the firm
ter of expanding Social Security. &
Co., Inc.
ern Internal
Department in Oper- upon request.

ment.

There

seems

to be

some

Alan Lauckner, First Vice-Pres¬
ident of the Institute and Assistant
:

The Institute of Internal Auditors Hanover Bank and -Trust Company
will ope'n at the Hotel Roosevelt in of New York w.lI be the general

who; have

balance states

formed

OpenrOn Oof. 8;
■

payroll, and

realize

thing as"

recommended

economists

had to meet

such

frozen labor contracts, as I
believe there will be some reac¬
tion not anticipated at the time

Chicago Tractions

Members

balanced

than all' of the patept-

parlor

never

dubious about the outcome' of the

Magnavox Corp.*
Majestic Radio & Tel.*
P. R. Mallory
Stromberg Carlson
Submarine Signal
*

Halsey & Co.,
Incorporate d,
from 1926 ' to

Annual Conference

tax .sysr

many

Instrument**-'

International

associated

Infernal Auditors 3rd 7

taking will

medicine

cerned.
T

profit-sharing and

'7"

*7 ;

economy

chinery in¬
dustry is con¬

Du Mont Lab. "A"*.

Radio

far

the heavy ma¬

liMffcSlWI
Emerson

this

Dearborn 1501

with Mr. Friedman
flexible wage plan coupled

tem to encourage risk
do more to
encourage

particularly

vital

Springbrook Water Pfd.

Southwest

believe

'"7v V:7* -7" •'

CHICAGO

231 So. La Salle St.

Andersen

partnership in the firm
viously reported in the
icle" of Sept. 21.77 c

agree

with

keel, and

that

busi¬

even

7% Pfd.

Sacramento, Calif.

Admission *. of

"C-11

States Life Insurance Co^,

order

keep

Power

tant

are

tment.

Halsey, Andersen '&
partnership was dis¬

This

in-1942.

President, California-Western'

impor-y.

very
!

Illinois Power Div. Arr. and Com.
Iowa Southern Util. Com.

LACY

request)

♦....•

joined Cyrus J. Lawrence & Sons

rationalizing:- : 7.7 rr:y

O. J.

flexible

payrolls

7!
;

quite agree

par

COMSTOCK &. CO.

the

name

Co.

solved

economy, a great deal of the leg¬
islation enacted in recent
years

nt ained

that

ibe

economy.

capitalistic system
survive, which means a free

therein.

Birmingham Gas
Conn. Light & Power

planned

been

194i, when he

resump¬

want the

most

the

was

activities

direction

agree,

Airlines

with

which

costs

natural

has

Mr.

-■—~
believe this, will'

will; hinderthe

read, with considerable

:•

Export Airlines
Chicago & Southern Airlines
Mid-Continent Airlines

777,77'.-

firnds research

~TV

result

(Circular sent upon

the

For the

head

thereby, auto¬
interest, the article entitled "Post¬ matically, adversely
y \
: _;
affecting em¬
war Employment, Flexible Costs
Paul C. Andersen
ployment. y%■%■"v
\ 7'.
V
and ^Profits," by Elisha M. Fried¬
It appears Aye. are headed in the yy'' :y.. -V.'",.' " 7,

American

Continental

Common

last two years

Mass.

War Stock

part¬

ner

firm..

Amer.

Outstanding

Long-Bell Lumber

comments received in connection

IIARNISCHFEGER

Pump

"B"

give herewith

Stove

Vicana

Spring St.

Trinity 3908

C.
ad¬

been

general

Employment, Flexible Costs-and Profits,'
by Elisha M. Friedman, Consulting Economist, which appeared ir.
our issue of Aug.
10.„ Among Mr. Friedman's
recommendations was
the adOpUpiv of a flexible wage str^ihture and application by industry
of the profit-sharing principle wi|M employees.
A number of ex¬
pressions elicited by the article wefe given previously in oui issues
of Sept. -21 and- Sept. 28.
7 7777" :'T,7
r'7:
v.

•

Pierce Butler

has

mitted

with the article "Post-War

Candy

Marmon

Paul

Pfd.

Employment, Flexible

Costs And Profits"

Welding

Hajoca

Loft

Stock Ex¬

Andersen

Cement

650 S.

CG 3S2

Son ★

Consolidated Textile

Randolph 3002

Cyrus J. Lawrence & Sons, 115
Broadway, New York City, mem¬

Minneapolis

Co.

Cons.

LOS ANGELES 14

C. J. Lawrence Partner

Incorporated

Chicago

MARKET

DISTRIBUTION

Brockway Motor*
Buda

SECONDARY

Broadway, New York

Common

bers of

Com. & Pfd.
7

For

A.C.ALLYN^COMPANY
Amer.

Teletype BS

UNDERWRITERS

Conv. Preferred

$2.50 Preferred

•

Middle West.— Pacific Coast

Inc.

Viking Pump Company of Iowa

Mfg.*

Wholesale Distributors

COMPANY*

Moorc-McCormack Lines, Inc.

Triumph Explosives
Wickwire Spencer

1990

Mocre-McCormack Lines, Inc.
United Printers & Publishers, Inc.
United Printers & Publishers, Inc.

Riley Stoker*

HUB

Common

Conv. Preferred

Corp.

Company
Company
Hart Carter Company

Distilling*

SQUARE
9, MASS.

CARTER H. C0RBREY&CO.

6% Preferred

Corp.

Foote Bros. Gear & Machine

r"-

OFFICE

Common

Liberty Aircraft New
Magazine Repeating Razor

POST

CHICAGO

Foote Bros. Gear & Machine

Great American Industries*

...

LERNER & CO.

4-3990

QUOTED

Buda Company
Colorado Milling & Elevator Co.
Elastic Stop Nut Corp. of America

Electrolux*

Howard Stores, Com.

request..

*■«>

Tel.

BOUGHT

12%

Circular sent upon

Appl.
Me., Prior & Stpd Pfds

Continental Casualty

Market 12

BOSTON

British Gaumont

Stock

Bendix Home
Boston &

Dividend Arrearage,

$1.25 Cumulative Participating

52 William St., New York 5

CHICAGO

BARCLAY

Riverside Cement j
Class A

Albany

105 WEST ADAMS ST.

Outstanding Cement Stock

With

„

George R. Cooley & Co.

Members N. Y. Stock Exchange and Other Principal Exchanges

Aetna Standard Eng.

State Bank of Albany
Morris Plan Ind. Bk.

Miller1 &

:;papers

activ¬

Announcing:

„

AMERICAN BANTAM CAR

.....

private

The installation of

BOUGHT

Quincy Cass Associates

Preferred

6% Cum. Conv.

Common and

wire facilities to

SOLD

—

Abitibi Power & Paper
5s, 1953

Circular

Angeles, California

Los

1461

FINANCIAL CHRONICLE

THE COMMERCIAL &

Number 4322

160

Volume

Request

Aldred Investment Trust
4

J.F.Reilly&Go.
111 Broadway

New York 6, N.

4y28,

Trinity Place, New York 6, N. Y.

2-5288

REctor

Boll

Paper

1956

-;.'7

London Canadian Investment

Teletype: Nlr 1-375

BOwling Green 9-7400

Telephone:

NY 1-2480

System Teletype

x/z «, 4967

Donnacona

Established 1914

Dealers Association

Security

York

New

Members

hoerqsesdrqsier

4y2s, 1948 ,4

Steep Rock Iron Mines, Ltd.
1957

5y2s,

of firm

;

'•

•

*•'

—New

Analysis

Request— '

Toronto

Montreal

New York

American Water Wks. &

■

•'*

Bell Teletype: NY" 1-395

INC.

ROBINSON, MILLER & CO.,
to

HAnover 2-0980

WILLIAM St., N. Y. 5

;

from

name

HART SMITH & CO.

Industrial Brownhoist 1st Pfd.

change

to announce the

This is

.*•

...

*•

Community Water Service

Frederick S. Robinson & 60.,

1946

6s,

New York 5, N. Y.

52 William Street

East Coast Public Service

Cleveland 14, Ohio

1582 Union Commerce Bldg.

1948

4s,

Telephone HAnover

Elec.

1975

5s,

2-1282

Currie & Summers, Neic York

"Wire to Troster,

Eastern Minnesota Power
5

Vz s, 1951

National Public Service

Commercial BankingAfterTheWar

Post-Wn Real Estate Prospects
.'/ 7'":".

By LLOYD E.

/; '

LUBETKIN "

Large Cities Will Increase

5%s,1952

By E. A. GOLDENWEISER*

Division of Research and Statistics,

Writer Contends That Because

1978

5s,

Central Public Utility

Board Of Governors Of The Federal Reserve

;•

Frederic H. Hatch & Co.

System

Population After The War,, And Because High Ma¬ Federal Reserve Statistician States That Because Banks
terials And Labor Costs Will Retard New Construction, Will Continue To Hold
Large Amounts Of Government
There Will Be Shortages Of Houses And Office Space.
Debt He Is Convinced That Bank Deposits Will Stay At
He Also Holds That Because Of The High Yields On A
High Level.
Does Not Expect Extensive Regional
Real Estate Bonds, Contrasted With The Low Returns
Shifting Of Deposits And Holds There Will Be No Pres¬
On Other Securities, Insurance Concerns And Other In¬ sure For
Liquidation Of Bank Assets As After Last War.
vestors Will Purchase Them, And That At Present Ex¬
Sees Continuation Of Present Level Of Interest Rates.
cellent Opportunities Present Themselves To The Intelli¬ ;
As our armed forces press closer to victory, bankers are asking
gent Investor For Real Value, Sound Security And High themselves what problems the future will hold for them. They will
Yields Which May Never Again Present Themselves. 'emerge from
in

Incorporated
63

New York 5, N. y.
NY 1-897

Wall Street

Bell Teletype

ERIE R. R.
4s

1996

General

1996

Convertible

1953

Refunding

1967-75

Lien

Prior

Preferred

Common

Erie, Jersey 6s -1955

/♦>-

r-';

consideration that there has been
buildings, hotels or apartment

One must take into

construction of office

amount

could

New

Y ork

p r a c

none

entire

been

fact,

City.

t h e

past

rons

ginning Oct. 16. These classes are
open to all and are conducted free
of charge. \ '

amount

and

have

mer¬

chandise of all

Lloyd E. Lubetkin

leap to
.
,
■
vv,> '
new. highs.
Since Pearl Harbor,
we have seen approximately 11 Vz
million .men
inducted into the
armed forces of the United States.
These men came from all walks
types

Some

It is an obvious conelusion that the-majority o£ these
men came from, small towns.
As

part of their training, and
their
being shipped
to
.

S. K.

Cunningham
wUl oben

r.m

kflceJln

Bos-

ngnam will open the investment
omces in B ^
to engage in

ton

■

•

Investors

•Corporation.

,:,,

-r

wealth ih

RALEIGH, N. C.

larger cities, much more so
than in the small towns, in which

Griffin is

they were born.,

trust,

•

believe

that

this re¬

industrial,

■ilifv
vt

now

for

the

war

and

the, extensive

effort, the Government has spent
billion dollars, much more

223

—

George I.

municipal

investment

much"

from

billions of taxes,

borrowed

89 bil¬

from individuals

nonbanking institutions,; :and
64 billions borrowed' from banks.

The

billions

banks' has

borrowed :from
in a corre¬

resulted

sponding increase in bank depos-

offices in the In¬

;.'*Based

Goldenweiser
Bankers

address

before

Association

the

Mr.

Illinois
Chicago,

Building, Mr, Griffin:was 111., and reprinted from the Fed¬
eral Reserve Bulletin, -September,
previpusi y' vice-president >;ofpMc*
1944,
.•
'
Tpopulation of our large cities, Alister, Smith & Pate, Inc., and
(Continued on page 1467)
V •1
Barrett, Merrick & Co., Inc.
'(Continued ori page' 1496)

shuffling o£ population-will , add
either, to the .urban and suburban

surance,

}

'"/j

.I:

Government

nounce

Tokheim Oil Tank & Pump

Co.

Ohio Match

Universal Match

■.

•

securities,

Incorporated
JVew York 5, N. Y.
1-897

Street

Teletype NY

Bell

an¬

director of R. W. Proc¬

tor & Co.

Pacific Coast Siock

the, or¬

ganization lis a contact man since
February, 1943. Prior to that Mr.
Hawkins headed
his own* firm,
Hawkins & Co.,. and before .that
was

63 Wall

vice-president. He

has.been associated with

Frederic H. Hatch & Go.

the election of Russell, S.

Hawkins

•;

Exchanges

"Free Cash

Quofeations and executions for brokers,:
dealers and Institutions on Pacific.
Coast securities, including those ■;•
which also have eastern markets.

Hickey, 49 Wall. Street,
City, members' of. the
New York Stock Exchange,, have
prepared a tabulation of estimated
"free, cash;' of the- • solvent; rail¬
roads -which is particularly inter¬

esting, in

view of
deals

the

under

Nety- Yofk

Members

York

railroad

v'1""

■

Dean Witter & Co.

Vilas &

New

77.

Open io 5:30 P. M. (e.w.t.)

Direct wires' '•

t)ian any government has previ¬
ously spent: in d'debacle or;byeii'a

acting as dealer in

local add over-the-counter

securities

and

the

U. S.

reason

purchase, of Government securi¬
ties by banks. In the four years
since the beginning of the defense

lions

that is a

our

tuiiities exist for future

principal

longer period/
This 223
billions/ plus an;,-ipcreage in rthe
Corp. and - The Parker Treasury's
cash1-' 'balance, name

6.1 Grifrin Opens
live ill
larger cities, as'J.'m|y
Office in Raleigh
undoubtedly. ■wjl! feel" thaf obpoT-

V;'

business. Mr.

formerly Assistant
Metropolitan Life

the

ing

General Tin Investment

posits is the large amount of money
we
have had to spend in fight¬

.MKQ

certain' percentage of these men
will come back with the' desirc 'to

■

Co.

American Maize Products

Insurance

tremendous wartime growth in de¬

foreign

One reasonable con¬

clusion must follow, and

firmly

.the, war ;
over,
a n d

prime investments.

prior to business, it is.'reported? Mrl Cun¬

fact, most of them had never been
out■ of the' towns in ■ Which they

was

Treasurer

after

The.

ningham was formerly Vice-Pres¬
shores, they have had an oppor¬ ident of Equitable Management
tunity to see many of the larger Corp. Prior thereto he was Pres¬
cities of the United States which ident of Sv" H.
Cunningham Corp.
they have, neyer seen before.
In and was an officer of General

;

Stanley

sharply'

Of J> Ba Roll & Go.

were'born,"

f f

will

Jife'and from all parts of the

country.

leading

concerned primarily with the

firm's underwriting

deposits fall

Teletype NY 1-955

DIgby 4-7060

seen

sales

dpminate.Will *

out the United

States;

Stock Exchange and other

St., New York 5, N.

of the New York

City, members

National Exchanges, where he

Company, and for the
is
past 10 years has supervised its
of. the .subjects covered what will be
industrial investments.
'
the position of ,
are: equipment and lights for allassets?'
types of vessels, rules of the road bank
at sea, seamanship, safety at sea.
i'l
. ..c 0. 11-.
, -£^ ^
Goldenweiser
that
;
V
the mariner's
compass,
aids to vinced
navigation, charts and piloting,
V; deposits wilstay at a high level
-..Further information may be ob¬ for many -years -after the war,
indefinitely,
and
that
tained from Paul S..Morton, Peter perhaps
J. B. Roll & Co., Inc., *1 Wall
Government securities will always
P. McDermott & Co. 4
' x : r'
Street, New York City, dealers in
be
•;

t h

row

t h r

Lynch,
Pierce,
Fenner &
Beane, 70 Pine Street, New York

1 Wall

joined Mer¬

rill

securities pre-

;

Stock Exchange

Members New York

Gilbert Stanley has

imagined

Government

handling

Downtown Athletic Club,
West Street, N. Y. City, be¬

treme ndous

activity

tV :

have-

folios in which

•

the

w e

had

free

giving

are

piloting; and small boat

years,

have

Sqiiadclasses in

The United States Power

coun¬

MADE

BIDS

GUDE, WlNMILL & Co.

;

any,

t h

decade ^ago
and with port-

ally

c
;

try. D uring

excess

1929

since

the, war with
'deposits in

quantity

any

the

practically
houses in

San

New York
Los

Angeles

and,commodity exchanges

STREET:

14 WALL

Stock Exchange1

Stock, Exchange -1

Francisco

and other security

BArcIay 7-4300
u Sin F-enewo
Honolulu

refunding
contempla¬

Attractive Situations
and 6% ; cumulative
convertible
preferred
of ' the
American Bantam Car and Pan¬
Also available to brokers and
ama
Coca-Cola offer attractive'
dealers is a letter discussing the
situations according- to circulars
puzzling
public perspective on issued by Hoit, Rose & Troster, ,74.
rail values, institutional and pub¬
jTtinity Place, N. Yk,City, Copies
lic appraisal' of which the firm ;hi
these circulars, may, be .had
.firm upon.request, h-'
feels is inconsistent.
/

Copies s of t this ; tabulation
may be
obtained from Vilas' &
Hickey upon request.

tion,.;

Common

Thursday, October 5,

1944

Trade Bank Elects
SPECIALISTS

Somlo Vice-President

111

MARKETS IN

TRADING

Real Estate Securities

REAL ESTATE

Securities

dent, of the Trade Bank and Trust
Company,

1929

Since

Pacific Coast

Charles Somlo, well-known in
banking and foreign trade circles,
has just been elected a Vice-Presi¬

SECURITIES

Orders

New York.

[■} In making

EXCHANGE^.,N.Y. Dlgby 4-4950
Bell

York 4

Broad Street, New

n't /

Schwabacher & Co.

Presi-

bank's

HAnover 2-2100

Teletype NY 1-953

Members

scribed the ac¬

quisition
M r.'

Real Estate Securities

TITLE CO.

V'By

john west

■"

14 Wall

to1; begin

Bond Prices Continue On The

Uptrend—Increased Prop¬
erty Earnings And Improved Realty Conditions Having

CERTIFICATES &

handle

Favorable Effect.

MORTGAGES

,y
•'»

Members New York Stock Exchange

1 WALL STREET, N.

■,.

TT.-

r a

other

Or. W. A. Mi Named

dealt

with

brief

outlines

articles

various

1943

During

Textile

Economist Of ABA

the

properties

and

bonds

securing

the

why

believed that

reasons

V,,:^;:4TL

Towers

Charles

United

States'

Treasury

De¬

was con¬

nected, in Washington for several

Company, New York.

to the Trade Bank from

partment with which lie

and

comes

the

84%

C-2

Current

Lexington
Title

National

';1944 ;

Building/,.^!-;

Hotel
N.

•

Date

Herald Square
Park Avenue_____

specific issues, giving
of

Somlo

-Bids-——
1943

■

of the firm

partner

price appreciation of the various
securities.:.:'
': -'■ V. •.' -• ;■ ■.

Dlgby 4-0964

v>- v;

years.

Principal Offices

San Francisco — Santa Barbara
Monterey — Oakland — Sacramento
.

Fresno

BENJAMIN, HILL & CO.

;
1943, in this Column, the writer made the following
countries. V y "1.
statement: "The coming boom should be in Real Estate Bonds." A
Charles Somlo
•"
Mr. Somlo is
Current prices compared with prices of that day have justified
'"-A-:.■:
former Vice-President of the
the prediction. Considering the low dollar prices of the securities, a
Manufacturers .Trust
the rise in price percentage-wise has been quite large.
Company,
Earnings, likewise, have had a tremendous rise, indicating that New York. He has also been senior

Bought—Sold—Quoted

Teletype NY 1-928

post-

with

On July 30,

New York 5, N. Y.

Private Wire

de¬
its

veloping
facilities

Street

COrtlandt. 7-4150

t of t h e
bank's ^ plans

\0r(j

York

Somlo's

services

;;

INcio York Stock Exchange
Curb Exchange (Associate)
v Chicago Board
of Trade TV. T.

■

New

p a r

Exchanges

Henry

L. Schenk, the

York Security Dealers Association

New

Members

Executed

Coast

announce¬

ment,

Incorporated

Members New York Stock Exchange
Members New York Curb Exchange
40

the

Seligman, Lubetkin & Co.

SHASKAN & CO.

Pacific

Tomorrow's Markets

Walter Whyte
Approach of

some stocks to
highs is harbinger of new

old

general

market

But

move.

temporary

interim

can

Basic action still

occur.

reaction

bullish.

•

Appointment of Dr. William A.
Irv/in

Bankers

can

the
mist

that

lieve

an¬

the

following

the

time

the

issue

bid

price.

the

light

that

Title

28%

Series F-U_

•

63%

56%

A--;,-.',.

st i t

upon

berg'& Co.

Post-Was Banking Problems

ducational

section of the

"By

Association,
Dr.

years

from
burn

Comptroller Of The Currency

The Deadwood Of The Past.

a,
William

he headed

the

economics depart¬

Of Scotch-Irish
received

his

Queen's Universities. He took both
his
B.A.
and
M.A.
degrees at
mas-

teaching activities there he stud¬
and

received

degree

of LL.B. in 1934. In addition to his

instructing in economics at Wash¬
burn he taught money and bank¬

ing. corporation finance and
Institute

Irwin

assistant

director

of The Graduate School of Bank¬

ing

the

Association
economics

American
and

faculty,

Bankers

member

its

member of
the Association's Public Relations
a

Council, and the board of trustees
of

its

with

•

Educational Foundation

Economics.

Giant

Portland

Cement

1944.
to

low-priced stock in an industry
a bright future and offers in¬
teresting
possibilities, according
to a circular prepared by Lerner
&
Co., 10 Post Office Square,
Boston, Mass. Copies of this cir¬
cular may be had from Lerner &
Co. upon request and also a cir¬
with

cular

Riverside Cement class A

which the firm believes is

standing cement stock with
idend arrearage.

...

<•;-

seems

particularly
pertinent time

for

gather

for

discussion

field

exam

bank

for

year ago

has

to turn our

•

could entirely

our

complex
It

is, of

course, obvious that these adjust¬
ments
and
problems reach into

the

financial

are

primarily interested.

field, in

which

forward

hostilities.

into

Preston

which makes all things pos¬

sible*

when

threatened.

from

war

This

peace

and

everywhere

are

the

crescendo

are

transition

may

now

expect to find the .clash of opin¬

note

least

one

have

group, the airplanes,'
advanced
nicely.
In
the

cases

of
are

the

change

confronted

with
this

On the
talks

new

highs;

front the peace'
to dom¬

news

which-seemed

inate

everything a couple pf
ago have died aborn¬
ing.
It now seems that vie-,
tory in Europe is not just
around-the corner, as general;
weeks

opinion would have had
believe

stead of
on

while back.

fighting dying down,

the Continent it

flamed

you.
For in-'

success

extent that

tively look

now

rising to such
may

forward

conserva¬

early

elimination of those vicious forces
which

threatened

engulf

US.

ments that peace

in that the¬

atre of the war will come be¬

fore

the

have

snow

flies

given way to

seem

Mr. Delano

out¬

before the National Association of

div¬

Supervisors

State

Banks

Milwaukee, Wis., Sept. 28, 1944.

no peace

Because this war has laid such

malignant-hand

of all

men we

upon

must reconcile

selves to the fact that

simply
we

our¬

not

are

back to the world

going

knew it. It has been shaken

and all who
cerned with the major
too. badly,
of

the lives

are

con¬

processes

take credit for

everything and

blame each other T'or all the

mistakes.

Based

various

public opinion polls it doesn't
look
an

if either side will have

easy

time of it.

The market

its, economy,

obviously hasn't

as we are, must
m^de up its mind on what the
original, thinking.
We must
emancipate ourselves from the political or the immediate for¬
It still
dead wood of the past; we must tunes of war will be.
do

invent new wisdom for
;

Banks

are

commerce -

the

and

a new age.

nerve

centers

business,

and

•

the

structure in its entirety
indissoluble • part
of any

it be
were

free
not

con¬

around

veers

time.

from

time

But the drift towards

higher prices

seems more

and

more,

apparent with each

sion.

Whether this drift fore¬

casts

ses-3

change in the political

the stimulating his¬ front is unknown. It
may in¬
banking throughout the
dicate a more lenient policy
many years in which it has grown
Never has the world so organ7
and become an integral part of or it may indicate nothing of
ized itself for the exclusive busi1
our everyday existence, we might
basic importance.
ness of war "as it has in this totali¬
But what¬
well doubt its capacity to meet the
ever it is the answer seems to
tarian struggle which was forced
test of this reconversion period.
upon
us
by these mad men of
be that higher prices are in
Certainly its leaders will require
Germany and Japan; never has
'
*
•
•
'
all
the fibre which has distin¬ store;
there been -such a complete and
guished, their predecessors.
But
Last week's column indi¬
violent change in the whole eco
it is. reassuring to look back for
nomic organization of these United
cated
the
possibility of a
a
rpmute
and think how well
States. This metamorphosis from
Up to this
banking as an institution has sur- minor setback.
impending transition from
peace.

war

to versant with

tory, of

*An address made by

has'

now

And the state¬

anew.

this

has

advance

ternal conflict.

economy, whether
controlled.
If we

depth

But

except mark time.

underneath the apparent dull¬
ness individual stocks and at'

ion, the conflict of economic the¬
until the summer or winter
ories. The selfishness of partisan
of 1945.
groups
and
all those
frictions
which are temporarily submerged
;
On the political front there;
in .the. common effort during ex¬
is Tittle change.
Both sides4

banking

which

Nations

borders

our

Into

the

Delano

The armies of the

situation.

"moral equivalent"

Let us
not underestimate the extent and

oped a deep¬
ly
satisfying

;

•

peace

for'-the glamour and exciting ten¬

•

economic and social life.

-there

successful,

their solution, and which concern

'devel¬

Allied

peace.

will lack the stimulus and

need to find

welcome

and the opportu¬

all of the elements of

met

counsel

Yet this peace brings with it
adjustments and problems' which
will
require high qualities for

ii nation

peace

it seemed

time
lose.

the

indeed.

Since

thought and effort toward build¬
ing up a civilization which at one

things is

swift

forward

nity which it gives

a n d supervi¬
sion. The pace

this

than

responsi¬

bilities

look

now

Nothing could

to fore¬

war

change in the

Bright Possibilities

,...

great deal of interest that I come to meet with the
National Association of Supervisors of State Banks this Autumn of

our

college and in
of, Banking
chapters at Kansas City and St.
Joseph, Missouri.
Dr.

•

com¬

mercial law in the

American

•

the

war

sion

Queen's University |
1921, he was appointed head of

back

the emotional urge which carried
;us

ters degree at

the
economics
department
at
Washburn College. Along with his

for

ing Returning Veterans With Loans; and (4) Providing
Enlarged Credits To Industry And Agriculture To The
Extent That "Will Require An Ever Diminishing Amount
Of Support From Federal Or State Authorities."

early education

road

from
this intense and close organization

(2) Raising*Bank Cap¬
italization To.A Higher Ratio To Deposits; (3) ProvidK

descent, Dr. Ir¬

Queen's. Upon receiving his

The

Reconversion !s Accomplished;

in Scotland and his higher educa¬
tion
in
Canada
at
McGill and

law

the threshold of-success.

He Outlines

Limits The Demand For Consumers' Durable Goods Until

Irwin

ment for 16 years.

ied

the'

market hasn't done much of,

some

compelling necessity of compress¬
ing great changes into a mini¬
mum of time—with the enemy al¬
ready on, the march. With what
expedition, and how well it was
accomplished, the world acknowl¬
edges today." It is one important
treason
why., the Allies stand on

Principal PostWar Banking Problems As (1) Holding Within Proper

College

Tope k

♦

Economy That We Must Emancipate Ourselves From

ago

Wash¬

Kansas, where

win

'%•

National Bank Supervisor Says War Has So Shaken Our

the

Institute seven

PRESTON DELANO*

Irwin

came

For the last few days

brought stocks to

v.':7

■

Banking, the
e

a memo¬

Copies of this memorandum
outlining the situation may be had
request from C. E. Unter¬

5(r%

Terrace

York

New

City.;

London

Trust Co.

investment, according to

40%

By WALTER WHYTE

National

randum issued by C. E. Unterberg
& Co., '31 Broadway, New York

r.'-i

•

Public

the

offers interesting possibilities for

In¬

rector

Shemeth Corp.
N.

conditions,

••

16%

Bank

i
-

46.

Drake

1' '

■

...

prices will go higher.

the

American

still feel

existing

Hotel

Stock

57%
56

(Mayfair House)
'
Metropolitan—.

Beacon

Savc-y Plaza

D i-

Hotel—

Avenue
65th

We
of

;59.

[Public National Attractive

'■

Albany
Hotel

a s

cational

George

.55%

specif¬

was

Clinton

Avenue1

East

ically mentioned and the current

National Edu¬

table is

interesting, it shows the bid price

will

continue

Governor

870—7th

St.

Broadway

475—5th

assuming

econo¬

1400

ap¬

We be¬

preciation would follow.

post

A.B.A.

Association

In addition

nounced.

price

Hotel

economist of the Ameri¬

peace

war was made under

the

(Continued

pageT490)

(Continued

on page

1502)

1463

FINANCIAL CHRONICLE

THE COMMERCIAL &

dumber 4322

Volume 160

Purolator*

interesting

American Hardware*

*Circular

Debenture 4s,

1991

4s,

Optioned V. T. C.

Free Common- V. T. C.

request

Inc.

Gen.

41/2S, 1971

1st Inc.

Telegraph Company

and if issued Securities

New When, as

Deep Rock Oil

situations

Established

1926

€«.

Members New
Direct

Bought & Sold

Phone:

Bell

REctor

Empire & Bay State
Telegraph Co.

Teletype NY

pflugfelder, bampton & rust

2-8700

1-1288

.<•

Pacific and Atlantic
•' r.....

Telegraph Co.

♦■

Railroad Securities

By JOHN BUTTON

- • /

The Investor

of this week the investment banking and securities
treated to another SEC conference. This time it was

On Tuesday
was

conference

lay

for educating the great

plans

public so that

the securities business.
;
, .. ..
the securities business who sent
representatives to this conference couldn't do anything else. "If they
whole business/ It's just another SEC brainstorm. It casts an indirect
reflection upon the securities business by bringing to the attention
of the public, that if there is any business about which they should
be suspicious IT'S THE SECURITIES BUSINESS.
It's raking up
the dead past, it's adding insult to injury and making it even more
difficult for the conscientious securities salesman to gain the con¬
fidence of investors and the general public by reminding them that
wolves sometimes walk around in sheep's clothing.
rwk/L/
The various organizations in the securities business who sent
representatives to this conference couldn't do anything else. If they
had ignored the SEC's invitation to come to this conference they
would have been subject to criticism on the score that they do not
have the public's interest at heart. Such is the power of the little
bureaucrats today, that even for such an empty gesture as this whole
business will prove itself to be — the "boys who make the law,
who enforce the law and who are the law" just whistle and Wall
Street runs to Philadelphia.%
•/'
■'v>;
v. ■
If there are not enough laws now to protect the public—if all the
State laws, State securities commissions,; better business bureaus/
NASD's and the SEC itself have not sufficient power and authority
to keep the small percentage of dyed in the wool swindlers4: from
fattening up on the gullible public in the years to come, then how
in the world can they ever have enough power and authority to
do so?
Education is not the answer if you are going to educate
the public in learning how to tell when a swindler is a swindler.
ANY SECURITIES SALESMAN WHO KNOWS ANYTHING ABOUT
SELLING COULD TELL THE SEC WHY PEOPLE GET SWINDLED
AND IT'S NOT BECAUSE THE SWINDLER IS SO SMART AND
HE WHO GETS HORNSWOGGLED IS SO DUMB. IT'S BECAUSE
THERE ARE CERTAIN PEOPLE IN THIS WORLD WHO THINK
THEY CAN GET SOMETHING FOR NOTHING. They are the ones
that the securities salesman who works for a reputable firm' .can
never sell because they want 20%
and the security of Government
bonds at the same time.
They are the ones that pass up sound
investment advice and believe that they can have their cake and
eat it too.
X/Yv'.A k-j'vV/'i'-" -v?

they could recognize "crooks" in
i
;
The various organizations in

•

There

need for f education of the - investing public
sound investment principles, and in gaining a
a;

along

better
understanding of the economic system under which our nation has
achieved the highest standard of living on earth. 'This type of
educational campaign would be worthwhile, but it is doubtful if any
4 New Deal bureau would ever initiate such a program.
Based upon
the record so far, sound economic policies are about the last thing
that existing governmental agencies would ever advocate..
.
, •
the

lines

period to follow the end of the war are impressed with the prospects
Missouri Pacific 1st & Refunding Mortgage bonds which have
recently been selling in the neighborhood of 66y?. This optimism is
based on the fact that a substan-<$>—■—
—-——;
—■—
tial
proportion of the current "net" cost of the securities to be

by received would be only $538.26.
cash
new first mort¬ The bonds are to receive $404 in
gage; bonds allocated to them in new first mortgage bonds. Even
reorganization. To this extent the if one evaluates the new first
market level should be well sup¬ mortgage 4s no higher than par
ported even if speculative enthu¬ (most new first mortgage, issued
siasm should wane. Very little is or when-issued, are selling at pre¬
being paid for the large block of miums running to 106) the junior
represented

price, is
and sound

market

securities, including both

junior

cost

the

preferred stock/ provided in
reorganization.
'Ay■
\

the

Available

bundle.

turn of

who accept that al¬

will be many

ternative.

NY 1-911

New York 5, N. Yj
Chicago 4, 111.

LaSalle St.,

So,

231

SEABOARD AIR LINE
RAILWAY COMPANY
A A

TRADING MARKETS

Old and New
Securities

Van Tuyl & Abbe
WALL STREET

effective

last

margin

wide

year

will

questionably

should have little diffi¬
the income bond
requirements under ail but the

and un¬

this

year

As of the end of this year/

also.

then, the 5s, 1980,'•■will have ac¬
crued cash representing income
1943 and 1944 on the new se¬

Baltimore & Ohio
Conv.

NY Bank Stocks

Without allowing for

will

this

for

the antici¬

from the

the; old 5s,

N. Y.

Teletype BS 259

Telephone HAnover 2-7914

Situations Of Interest
H.

Koller

are

now

of the

bers

prepared a memoranda on Great
& Meeds, 120 American
Industries, Laclede
York City, mem¬
New York Stock Ex¬ Christy Clay Products and In¬

change, have

attractive at cur¬

believes appear

Copies of these in¬

levels.

rent

teresting

recent

circulars

issued" securities of the

Discussion of

Mid

Continent

Na¬

Airlines,

and, Northrop Air¬
offers attractive possibilities,

craft

according to circulars

just issued

Reilly & Co., Ill Broad¬
New York City.
Copies of

by J. F.
way,

these

West Shore

be
request.

interesting releases may

from

the'firm

upon

new

Railroad

TEL.

STREET

HANOVER 2-1355

•'

•

rt'.l

Bought—Sold—Quoted,

Pfd.

SEABOARD common

Mclaughlin, baird & reuss
ONE WALL

2381

Coupon & Registered

4V2S

SEABOARD Non-Cumulative

Cony on request

Members New York Stock

"when
SEABOARD RAILWAY COMPANY.

SEABOARD 70 year income

Decline"

had

H. Koller

& Co.

SEABOARD 50 year 1st 4s

r *

may

request from F.

Interesting Air Situations

brokers and dealers in the new

firm

the

which

Limestone

diana

upon

1980, the 'had

trading

Ill

Inc.,

Co.,

Broadway, New York City, have

1st 4s,
We

tional Airlines,

be.entitled to cash of $126.74.

Deducting

St., Boston 9, Mass.

Tel. CAP. 0425

Broadway, New

year's interest has al¬
paid this year and a
distribution is expected
early in 1945.

148 State

Bissell

Laird,

Compared

One

market

of Rail Earnings

1960

Pollak Manufacturing

bonds in the in¬

"Interpretatiomof Narrowing Trend

YORK

NEW

company

date of the plan
most severe depression condition?.
1943, and income has Under reasonably good conditions
been accruing on the new securi¬
the preferred dividend require¬
ties since that date. The preferred
ment should also be covered by a
is cumulative to the extent earned
good margin.
—the dividend was earned by a
The

pated additional interest payment,
the bonds. as of the end of 1944

Telephone: IIAnovcr 2-7900
Teletype:

fixed

is/Jan. 41,

later in 1944 or

New York 5, N. Y.

Wall Street

120 Broadway,

culty in covering

-VA'■

;'" ;'. •'./

ready been

York Stock Exchange

other

and

Exchange

Stock

of taking

similar

New

9.59%,' Certainly the

have the option
2.79 shares of series "A" portion of interest may be con¬
sidered eminently safe under any
common stock instead of the cash
but,it is not believed that there conditions, while the reorganized

stock. Holders will

made on the old

Brokers* and Dealers

MEMBER8

York

New

leading Security and Commodity Exchs.

may

prepared a detailed
comparison and analysis of New
directly in reorganization, a total York City Bank Stocks as of Sept.
of $176.74. From this is to be de¬ 30, 1944, copies of which may be
ducted
any
interest
payments had from the firm upon request.

VILAS & HlCKEY
Members

than $134.26 for
This is allowing a

value of less than 40 for the new
series "'A" income 41/2S and no
take the first & re¬
value at all for the series "B"
funding 5s, 1980, as an examplebonds or preferred stock.
If one
other series of the same mortgage
assumes
a
value of 105 for the
are treated in relatively the same
new
first
mortgage bonds the
manner
but actual allocations of
bundle of new securities would
cash
and
new
securities vary
cost only $114.26, or a little less
slightly in line with the difference
than 30 for the series "A" income
in unpaid accrued interest to the
bonds and nothing for the more
effective date of the plan.
Under
the Interstate Commerce Commis¬ junior securities.
On
the
basis of the present
sion :• reorganization proposal,
"net" cost of the 5s, 1980, fixed
which followed
closely the so-^
interest on securities to be re¬
palled compromise, plan devised
ceived would afford an income re¬
by bondholders'groups and should
turn of nonlinally better than 3%,
thus prove satisfactory, $ie Mis¬
combined fixed and contingent in¬
souri Pacific 5s, 1980* are to: re¬
terest would afford a return of
ceive $72.46 in cash, $404 in new#
first 4s', $384 in series "A" income approximately 7.6%, while all in¬
terest plus dividends on the pre¬
4V2S, $152 in series "B" income 5s
ferred stock would1 afford a re¬
and 2.22 shares of 5% preferred
We

terim.
Letter

at a

securities would be acquired

and

bonds

income

the

series

of $104.28,
in addition to the cash allocated

Request

for the

for

PiiblicjPei'speclive Puzzling

*Summary

curities in the amount

(Institutional and public appraisal of
Railroad values inconsistent)

Telegraph Co.
inclined to

analysts who are

the railroad

among

Southern and Atlantic

most conservative attitude towards the outlook for railroad
securities (particularly speculative issues) during the reconversion
adopt

those

Even

The SEC's New Plan To Protect

Telegraph Co.

Bell Teletype—NY 1-310

Telephone—DIgby 4-4933

The Securities Salesman's Corner

business

International Ocean

New York 6

Broadway

Hartford 6111—Buffalo 6024

'Vi/V;

Exchange

York Stock

New

Members

York Security Dealers Association

Wires to Boston & Phila.

Enterprise 'Phones

1981

( When as, and if issued)

120 Broadway/ New York

War i»

Western Union

Minneapolis, St. Paul & Sault Ste. Marie

Exchange

NEW YORK 5
TELETYPE NY 1-1310

•

stock

required

exchange name

is given and

all

transactions.

1. h. rothchild & co.
Members
.

National Association

of Securities Dealers, Inc.

•

Adams & Peck

63 Wall Street,

specialists in rails
52

wall

KAnover

street
2-9072

u. y. c.

tele. NY 1-1293

New York 5

BOwling Green 9-8120
Boston

Philadelphia

Tele. NY 1-724
Hartford

1464

THE COMMERCIAL & FINANCIAL CHRONICLE

Insurance & Bank Stocks
Bought
ANALYZED

Sold

—

Quoted

REVIEWED

This advertisement appears

;

Thursday, October 5, 1944

matter of record

as a

only,

Royal Bank of Scotland

all

Incorporated by Royal Charter

of this stock has been sold.

HEAD

Special Bulletin and Booklet Service to Dealers & Brokers
Trading daily 7

a. m.

to 5

NOT A

NEW

ISSUE

Branches

13,333 shares

:'i;"V

■

Casualty Company

St., Los Angeles

PRIVATE
New York

Chicago

TELETYPE

27!)

Charing Cross, S. W.

.;:/;"w;;:

Seattle

Capital Stock

64 Neil) Bond

27%

per

TOTAL

;;

■

This Week—Bank Stocks

Associated Banks:

New

Investors, as distinct from speculators and short-term traders,
usually take the long view. Particularly is this true of investors in
choice New York City bank stocks, which sometimes have been
termed the "Aristocrats of the

commercial

war.

unbroken

dividend

■•'■■■■ ^'/

■.111

City

of
Further¬

group

York

New

York

Stock

N.. Y.

Telephone: BArclay 7-3500
Bell

Teletype—NY

(L. A. Gibbs.

Before

the

ments

undoubtedly

stocks

will

happen

are

Dr.

expand

There

make

7008

(ESTABLISHED

,;;

Enterprise

7008

1817)

Paid-Up Capital

__£8,780,000

Reserve

A.
of

Goldenweiser
Research

Federal

the

Statistics

Reserve

of any amount that
could have been imagined a dec¬
ade

excess

ago

and

with

portfolios

which Government securities pre¬
dominate.
Will deposits fall off

any

sharply after the

war is over, and
what will be the position of bank

connection it is pertinent to quote

considerable
over

are

source

gotiations
possible

are

extension

from

businesses/ and
the

efficient

war

assured of

for

volume

borrowing.

less

;

counts

of in¬

At the present

reported by
review

the

securities, which relation¬
ship is, to say the least, i unusual.
But even though loans
jand dis¬
counts (business borrowing) have
been

heavily overshadowed in re¬
cent years by Government securi¬
ties
(Government borrowing),

former, too, have

shown substantial expansion since
June

30, 1939, rising from $2,872,981,000 to, $5,128,291,000
on

1944,

increase

that

banks

active

the

draws to its

the peace years

bilitation work
conversion

States

the

United

will both

capital
ume.

close, and during
following, yReha¬
in Europe and re¬

work

require working
very substantial . vol¬

Already

has

mally announced that

arrangements with

throughout the 11. S.

;

Banks

for¬

been
a

group

NATIONAL BANK
of EGYPT
Head
Commercial

FULLY

PAID

RESERVE

Office

and 7

Cairo

No.

CAPITAL

King

Cairo

£3,000.000

FUND

£3,000.000

LONDON

interest

planning to

are

this field.

that

bank

one

AGENCY

VVilliam Street,

E. C.

"Branches tn all the
;

principal

;

Towns

EGYPT and

the SUDAN

also

least,
viz:
Bank of America, has an¬
nounced plans for financing the
purchase of private airplanes.
A significant move was recently

NATIONAL BANK
of INDIA. LIMITED
Bankers

made in New York City with the
formation of a $100,000,000 bank
credit

pool

the

by 23 city banks.

Head

cently

adopted

program

Small

Business

of A the

Bankers Association.

Uganda

26, Bishopsgate.
,

India, Burma, Ceylon, Kenya
Colony and Aden and Zanzibar

Subscribed Capital
£4,000,000
Paid-Up Capital—;.-i_£2,000,000

the

It is under¬

Government

London, E. C,
Branches

Reserve

Credit

American

the

Colony and

Office:

such credit group to
be formed in accord with the re¬

Post-War

Kenya

first

of Commission

increas¬

ing demand for bank credit
war

Agency
i

.;;

Street, E. C.
Berkeley Square, W. I

ma¬

may

likely to be

Many

one-

ment

30,

:■./'

and also for home modernization.

banks

only about

third of their volume of Govern¬

nevertheless the

Threadneedle

/
-

rather wide scale,
consequently financing, .will
be
needed for the purchase, of auto¬
mobile and household appliances

time the volume of loans and dis¬

under

^ LONDON OFFICES:

;

well be quite
large. Consumer instalment buy¬
ing wilt also be. resumed on what

service
to
investors,'
travellers interested in thew

year

steady vol¬
income from this

gross

alone

banking

traders
and
countries.

industries

production of

George Street, SYDNEY

800 branches in all States of
Australia, in
New
Zealand,
the
Pacific .Islands,
and
London,
it offers the most complete and

straws in the

wind.
With regard to domestic
needs,
there is little doubt but that the

ac¬

Office:

The Bank of New South Wales Is the
oldest
and largest bank in Australasia.
With over

possibly/ to /France.

and
are

—£187,413,763

DAVIDSON, K.B.E.,
General Manager
.

rehabilita¬

burg,

£23,710,000
30th

ALFRED

Head

Belgium and Luxem¬

These

of in¬

excess

expenses

There is likely to be

Bank and Insurance Stocks

SIR

preliminary ne¬
being held for the

tion loans to

6,150,000-

—

A-';'

loan to the
Government.
It
is

78.5%.

Liability of Prop.. 8,780,000

$100,000,000

Netherlands

to commercial banks is bus¬

June

Brokers and Dealers

Fund

Aggregate
Assets
Sept., 1943

also reported that

could come,
through: retire-j

Another important source

Phone—REctor 2-4383

the

its

little

seems

-i

NEW SOUTH WALES

New York City banks, headed
by
the
Chase
National Bank, will

':V.J

indefinite period.

System,
from his article in the September
Federal Reserve Bulletin, as fol¬
lows:; "They - (the banks)
will
emerge from the war with depos¬

danger
of deposit
contraction, in fact the
'exact opposite may occur.
In this
•

Division
of

wondering what
these
deposits

anticipate

de¬

after the war, perhaps

would

iness

after the war, and appear fearful
kst thev may shrink
considerably
and with them the
earning assets

banks,

SEATTLE

many

come

;

bank

BANK~OF

CHICAGO.

banks will be called upon to
pro¬
vide funds for the reconversion of

ume

1891

MArket 3-3430

Many dealers and investors in

reason

Established

18 Clinton St., Newark 2, N, J.

Govern¬

will

that

convinced

ment of the national debt.

banks

both; de¬

still further.

of the

Jersey

J. S. Rippel & Co.

in- 1939.

over

Australia and New Zealand

after terials to the production of peace¬
time goods.
Further, it is impor¬
year in order to start redeeming
its
bonds
in
any
appreciable tant to bear in mind that the dis¬
quantity. At best the retirement tribution industry was badly shat¬
of our huge debt will be a slow tered by the war,,and that job¬
and painful process, and it seems bers,"wholesalers, distributors and
likely the banks will hold large dealers/particularly in the fields
portfolios of interest-bearing Gov¬ of automobiles, electrical house¬
ernments for many years to come. hold goods, etc., will be needing
Thus it seems certain
that
the working capital in an aggregate

Local Securities

$24,-

holdings 1 of

and

BOSTON,

FRANCISCO,

</;:///V,

TO:

PROVIDENCE,! Enterprise

thus of deposits,

come

Bank Stocks

$14,approximately three

war

posits

and

need

Holdings of Govern¬

held

YORK,
SAN

PORTLAND,

G0U

principal. means by which
any substantial reduction; in the
banks' volume of -Governments;

about,

1-12H-49

Manager Trading Department

New

ment securities amounted to

amount

NEW

TELEPHONES

complish this the Federal Govern¬
only have to bal¬
the budget but would also

131,655,000, or approximately dou¬
ble the volume when Hitler start¬

times -the

Street

7535

ance

According to the balance
sheets of June 30, 1944, deposits
of a group of 15 leading "Wall

809*400,000, or

•;

Salle

ment would not

war.

The

Exchange

120 BROADWAY, NEW YORK 5,

Government in the prosecution of

ed his

Enterprise

..investments " y

enor¬

aggregated

FRanklin

ANGELES,

indefinitely, and that Government;
securities will always be prima

Request

Laird, Bissell & Meeds

City

been expanded

banks

LOS

posits will stay at a high.level for

Sept. 30, 1944
Available

mously through the "deficit fi¬
nancing" program pursued by the

Street"

'T
I

many years

of banking.

the

':';v ;

greater potential earning power
than at any time in the history

New

CONNECTING;

LOUIS,

ST.

'V-1

Bank Stocks

depressions,1 booms and
have they inCreased
in size
and
usefulness,
such that today they stand with
their resources at a peak and with

Chicago 3
135

Square

0650

Bank, Ltd.

CG-105

SYSTEM

WIRE

PHILADELPHIA.-

assets?

of the past, so

Deposits

PRIVATE

■■■/1

New York

panics,

banks have

Office

HUBbard

Deacon's

Glyn Mills & Co.

Reserve

more, as they have weathered the
wars

Post

1-2875

Comparison & Analysis

Members

3-0782

HARTFORD,

payments

averages 74 years for a
15 leading institutions.

Boston

•

First, however, it is not inap¬
propriate to recollect that New
York's leading commercial banks
have a long and successful his¬
tory, that many of them are w<*T
past the century mark in age, that
a few have paid dividends with¬
out interruption for more-than a
century, while the average length
of

Street

Wall

Security Market".

banking after the^

'••

York

WHitehall

This being so, and
in view of the possibility of a relatively early ending of the war with
Germany, is seems opportune to give some thought to the prospects
of

Williams

Huff, Geyer <Sl Hecht

By E. A. VAN DEUSEN

•

ASSETS

£115,681,681

Bank and Insurance Slocks
fV

Street, W, 1

280

'v;;;;//1'

Burlington Gardens, W. I

/"•

.:1

San Francisco

WIRES'

OFFICES:

Bisbopsgate, E. C. 2

8 West Smithfield, E. C. f

National

OF CALIFORNIA

210 West 7th

throughout Scotland

LONDON

BUTLER-HUFF & CO.

OFFICE—Edinburgh

(P. C. T.)

p. m.

Orders solicited.

Inquiries invited.

1727

COMPARED

The

Fund„__.;__

£2,200,000

conducts

Bank

description

every

banking and exchange

;

Trusteeships

and

•

business

Executorships

also undertaken

stood that similar groups may be

organized in other principal bank¬
ing centers throughout the

I;'

Attractive Situations

coun¬

try.
:

Ward & Co., 120

All in all there

that

point

great
world

the

activity
as

are

many

probability

the

gives

war

^Industrial, Railroad, Public Utility

signs

way

banking
to

peace.

Broadway, New
City,s have prepared circu¬

York
lars

seyeral

situations

which

currently offer attractive possi¬
bilities, the finp believes..,Copies
of

these circulars, on the follow¬
ing issues, may be had from Ward
& Co. upon request.
'
,

Securities
t

■

•.

■

•

Du.
1

•

ADVERTISING
In

J. K. Rice, Jr. & Co,
Established

1908

All Its

Albert Frank

Guenther Law

Incorporated
Rector
2-4500

120
-

BROADWAY,
N. Y.

New York 5,

Teletype
NY 1-714

131 Cedar Street

York

Security Dealers Ass'rt

Razors

.i,

Long

Bell

Lumber Co.; Great American In¬
and

Cutlery Repair¬

ing of Every Description.

New York 6, N.Y.

Telephone COrtlandt 7'5060
Boston Chicago Philadelphia San Francisco

Members New

Sextoblade
Blades.

"A"

Distilling;
CrowellPublishing; P. R. Mallory;

Instrument;
Headquarters For

Prepared—Conference Invited

Laboratories

Merchants

•SINCE 1889

Branches

Plans

Quality Cutlery

Mont

dustries;

preferred;

Power

Light $2

Majestic Radio;

Mag¬

Corp.; Electrolux; PuroiaBrockway Motors; Mohawk

na vox

tor;

t ■

Mid-Continent Airlines;

Massachusetts

WECK CUTLERY, Inc.

Rubber,

138 Fulton St.

Douglas Shoe; Bird & Son; Cons.

CO.

7-1176

45 Nassau St.
,

RE.

2-9192

Cement

Moxie,

"A";

Scoville

Riley

Mfg.;5

Stoker; -and

American Export* Airlines.**

■

1465

FINANCIAL CHPONICLE

THE COMMERCIAL '&

Number 4322

160

"Volume

NOTE—From time to time, in this space,

Wanted

for

there will appear an article which we hope
will be of interest to our fellow Americans.
This is number fifty-four

Government

UTILITY PREFERREDS

record and

portfolio work, offers an unusual opportunity to an
experienced Government bond specialist now employed
and capable of earning in the five figure bracket, to head
its Government bond department.
Our client desires an
institutional contact man with real sales ability as evidenced by
bank

Paine, Webber, Jackson & Curtis
ESTABLISHED 1879

University of Captivity
Sometime ago we wrote an

personal bank following and a sizable current proven pro¬
a trader although experience in trading
desirable. Such a man should have a sound educational and
duction rather than

Light—have been largely distributed
The company recently reduced

1943-44.

during

stockholders

Power

Delaware

and

••

With

•

some

/%/::•/

•

70%

the

assets

to
its

which reaches

distributed, the company still has
securities with a book value of

$90,000,000 together with net

over

assets

Cash
rent

(after deducting cur¬

liabilities) estimated at about

$5,000,000.
consists

subsidiaries

some

The security portfolio
about $30,000,000 in
(principally

The company has paid
dividends each year since 1885
and there is little doubt that pay¬
ments will continue, but it is dif¬
ficult to see how more than 60
cents can be paid, and on that
basis the current yield would be
only
4.3%,
Using consolidated
earnings, the current price-earn¬
ings ratio is 17.5, which is nearly

stocks

Formed in Detroit

United

Utilities

Co.,

Midland

and
carried

Co.

over

$8,000,0^0, which will probably be
out in the pending reor¬
ganization plans for those two
companies. /,
%

wiped

department.

ities

large number

to $25 on the new.
However, it is doubtful whether
the company will ever liquidate
equivalent

completely, since it apparently
plans to continue as an invest¬
ment corporation, though divest¬
ment of some of the remaining
assets may prove,necessary.

One

Mr.

Livingstone & Co. was previously
reoorted in the "Financial Chron¬
icle" of Sept.

21.

activities in water-gas

Hentz

Co.,

when

nounces

that

William

member and one of the

of the Security

the

tion,

does not seem quite so
favorable.
For the
12 months

Loss

has

was

founders

Analysts Associa¬

formerly with Blair

Co., Inc.

Subject to prior sale, we offer

new

registered with the 2%% due March
recovery

with
had

per

Gilbert J. Postley &

Co.

BROADWAY, NEW YORK 6, N. Y.

Direct

gains of from 3/32 to 8/32 were
15, 1960/55 showing the largest
.

bepn

have made about ten days ago.

;

was

...

reported that despite the various

plans on future taxes it

Wire

Chicago

quite generally concluded among the

has been now

war

are

over.

...

■;

PROSPECTS

•

tax rate.

The increase

24% normal rate and a 26% sur¬
in the surtax would mean that the partially
of

specifically

re¬

are

they

with teachers
ranks. These

recreational

ac¬

furthered by neutrals,

by WAR PRISONERS AID.
are aptly called, "The

and

The classes

University of Captivity".
also that the

I find

University of London

credit toward degrees for
prison camps, and it
is hoped that American educational
institutions may make similar ar¬
gives

work done in

rangements, One of the happiest
bits of news that has reached this
writer since the war
irom

Y.M.C.A.

began comes
official from

Sweden, who recently visited prison
camps

in Germany. In one camp

alone he found

thirty-fi ve classes in

session with

total attendance of

thousand

men.

To Dad and Mom who have a

boy

Salute to

I say—
your lad—and be of good

cheer!

" '■

prison

camp,

may

•

MARK-MERIT
Of SCHENLEY DISTILLERS CORP.

rate instead of the present

corporations likely to fall some¬
levels it is indicated that the
partially exempt obligations at present prices have quite fully
adjusted their position to the new anticipated level of rates as •
well as the yield after taxes on the taxable issues. . .
the 40%

tivities

•/.!/.

would most likely be made up

were

classes and other

one

%
/
The pattern of future taxes indicates there will probably be a
rate of at least 40%, such as we have now, with many holding the
opinion that a rate of 50% would not be entirely unexpected. . . .
The present tax of 40%, exclusive of the excess profits levy, con¬
sists of a rate of 24% normal and a 16% surtax, whereas a 50% rate

TAX

of them

drawn from their own

and 50%

corporate income taxes is not
Accordingly there appears to be
ample evidence to support the belief that the partially exempt bonds
are
now
at prices where they appear to be attractive, since any
declines from these levels should be very minor.
'

P. S. Yes

...

War Bonds! Buy 'Em

and Hold 'Em!

;

letter
Distillers Corp., 350
Fifth Ave., N. Y. 1, N. Y. and you
FREE— Send

postcard or

booklet containing

Schenley

will

receive

reprints of earlier articles on
ous subjects in this series.

vari¬

The complete elimination of the

considered likely

to happen.

...

Interesting Situation
Western Union

Telegraph Com¬

Debenture 4s of 1981 (when,
and if issued) offer interesting

pany
as

EARLY MATURITY

CALENDAR

possibilities according to a sum¬
Another fact has been pointed out in connection with the par¬
mary
of the situation prepared
tially exempt government bonds and that is, these obligations mature by Ernst & Co., 120 Broadway,
or become
callable very rapidly in the next few years, with more New York City, members of the
than one-half of the total outstanding of $22,170,000,000 maturing New York Stock Exchange and
other leading exchanges.
or being retireable by 1950. ... By the end of 1947, or onlv slightly
Copies
of this summary may be had from
more than three years from now, $5,559,000,000 of these obligations
will have been refunded, which is more than 25% of those presently the firm upon request.
.

During the next year, the partially exempt

2*%% due

September 15, 1945/47, outstanding in the amount of $1,214,000,000.
become callable and undoubtedly will be retired at the call date, v. .

North American Light & Power common

advance of 8/32.

PRISON¬

M.C A., which is a

Mr. Church also tells me that

evident that many institutions, that had been
on the sidelines watching the market action of these obligations,
were ready to buy as soon as they believed the partially exempt
bonds had about reached a bottom, which these issues seem to
It

David M.
Rela¬

National War Fund,

that the WAR

hold regular classes

;; V

advanced sharply near
sinking spell of the previous week
made for the year by many of these issues. . . .

lows were

outstanding.

50,000 Shares

$1.00

•

partially tax exempt bond market

During last Friday's trading session

Beaver

and

picture

With post-war tax rates of

useful in joined the organization as head of
manufacturing of raw mate¬ the research department. Mr. Loss,

From

The

where between

which have proven

synthetic rubber.
■
an
earnings angle,

Governments"

JOHN T. CHIPPENDALE JR.

quested by American war prisoners
who are continuing their studies
which were interrupted by the war,

the end of last week following the

Dept.

Street, New York City, members
of the New York Stock Exchange
other leading exchanges, an¬

been carrying on research
tars, which
has resulted in the development
of new petroleum cracking proc¬

years

rial for

i ■%'

%/f'!%'!

0f H* Heniz & Go.

industrial subsidiaries, Ugite
Sales .Corp,, has for a number of

esses

many

"Our Reporter On

participating service of the N ationa^
War Fund, has shipped nearly
150,000 books to prison camps in
Europe during the past year. Many
of these books are textbooks and

Address "WT", care
Inc., Adver-

exempt issues would be subjected to a 26%
.16%, rate./.;;
■
V\.

wm. Loss Heads

of its

the

Livingstone was

ERS AID, Y

using, 131 Cedar Street, New York 6, N. Y.

number of

recent letter, Mr.

tells

of Albert Frank-Guenther Law,

■

avidly studying them.

are

tions of the

giving details of business

personal history.

indebted to

Church, Director of Public

Write in confidence

of the

formerly in
business in Detroit as principal in
folio, over 50, it is difficult to
S. R. Livingstone & Co.; Mr. Han¬
make any accurate appraisal of
cock was also associated with the
liquidating value.
Standard & former firm.
Poor's as of Aug, 21 estimated
Resumption of activity by S. R.
$2.50 for the old stock, which is
items

;

experienced fin¬
ancial people that there still will be corporate taxes after The war is
over, and that they will probably not be dissimilar in rates to those
a new partnership, with offices in
we have at the present time. ...... The elimination of excess
profits
the Penobscot Building to deal in
investment securities.
George E. taxes will probably take .pLace only after the ending of the conflict
with Japan, in fact it is indicated 'that many tax experts believe that
O'Brien is associated with the firm
it would not be advisable for this tax to be changed until both phases
as manager of the unlisted secur¬

of
which remain in the port¬

Because of the

of this advertisement.

and

advised

Our client's personnel has been

'v
are

prison camps, where our American
boys

;

good people for dispelling the mys¬
tery of how this book and many
others find their way into German

merely leads—available to further ex¬

accounts-r-not

pand his earnings.

Go.

S. R. Livingstone

land

Firm

against his
v

was

war.'/

selected list of 3,000 banks.

Compensation: Liberal salary or drawing account
own earnings plus those.of his department.

surplus.

companies), $47,000,000 double that of National Power &
of other utilities, and
Light, another holding company
$14,000,000 miscellaneous invest¬ which is well on the way toward
ments.
The oqtside investments
liquidation. The difference is, of
include a substantial,, proportion
course, partially accounted for by
of non-dividend-paying securities,
other factors.
with a book value far in excess
of present, market prices.
It in¬
cludes sizeable blocks of Amer¬
ican
Water
Works,
Common¬
wealth & Southern common and
warrants, Niagara Hudson Power
preferred and common stocks and
DETROIT, MICH.—S, R. Liv¬
warrants, etc.
Miscellaneous in¬
ingstone and J. A. Hancock have
vestments include stocks of Mid¬
formed S. R. Livingstone & Co.,

small gas

it. He

and trends—one who knows values from a market
can analyze bank portfolios and authoritatively
advise banks as to the proper setup of their Treasury holdings
in relation to their own individual situation and problems.
He should be versatile in arbitraging. He should also have
the ability to express his ideas convincingly by editing a
monthly review and forecast of the Government bond market

23,252,005 shares of common stock *
to
one-tenth
that amount,
and ended June 30 consolidated share
the new common
shareholders now have one share earnings on
stock
basis were 80 cents and
in place of each 10 old shares.
The
current
quotation on
the parent company earnings 60 cents.
The dividend of 10 cents a share
Stock Exchange is 14 (range 15Vz13%)
compared, with
the old!on the old stock, paid in June,
stock's 1944 range of about 2%-iwas equivalent to $1,00 a share
on
the
new
common,
but this
V/z and 1929-43 range of 59%must have been paid partially opt
2%.

prisoner, was studying
interested in taking up
advertising as a career after the
boy,

can

standpoint;

has for some time cooperated with
the SEC in a program designed to conform to the requirements of
Section 11 of the Holding Company Act. The company's three largest
holdings—in Public Service of New Jersey, Philadelphia Electric,
Improvement

Gas

Ger¬

prison camp where an Amen-,

man

bond prices

.United Gas Improvement
United

advertising had gotten into a

practical background in principles of bank investment com¬
bined with ability to sense quickly and interpret accurately
basic factors and current happenings affecting Government

Securities

article

entitled, "Prisoner of War", in
which we wondered how a book on

Public Utility

series.

"The

firm, with successful

consistently expanding clientele specializing in

Department

established New York investment

SCHENLEY DISTILLERS CORP., NEW YORK

Favorable Prospects

The outlook for National Cas¬
V-k% due December 15,
1945, mature and will no doubt be replaced by a taxable security. . . . ualty Company is very favorable,
Both of these 1945 issues, it is believed, will have been refunded
according to a detailed study of
before any major changes may take place in taxes, and it was pointed
the situation prepared by Huff,
out that institutions needing exemption from taxes for the next year
should find these two obligations suitable for that purpose.. . . During Geyer & Hecht, 67 Wall Street,
1946, $2,344,000,000 of the partially exempt issues become callable, New York City.
Copies of this
consisting of $489,000,000 of the 3%%, due March 15, 1946/56, and interesting study
may
be had
$1,036,000,000 of the 3% due June 15, 1946/48. as well as $819,000,000
from Huff, Geyer & Hecht upon
of the 3%% due June 15, 1946/49 and refinancing of these high coupon

Likewise, $541,000,000 of the partially exempt

:•
.

]

(Continued on page 1504)

request.

1466

THE COMMERCIAL & FINANCIAL CHRONICLE

Maintain

Trading Markets

Autocar

in:

CLEARANCE
We

5% Couv. Pfd.

enced

Lukens Steel Common
Tax free in

Los

Wire

"
are

For

Insurances

and

Lives

security

Streets

Reserve

A. Webster Dougherty & Co.

Municipal Bonds

1421 CHESTNUT STREET

Member

'' >:■■■•

Federal Deposit Insurance

System

Aug. 1, 1965 @ 1.65%

VV/'A:;

■

PHILADELPHIA

Federal

7/4% Industrial Waterworks Ref.

COMPANY

Member

Los Angeles

Birmingham, Alabama

•'rv

Cranting Annuities

15th and'Chestnut

Hagerstown, Md.

Pittsburgh, Pa.

experi¬

clearance

THE PENNSYLVANIA

between

New York

the

Inquiries invited

Philadelphia 2

Walnut Street,

handling

$50,000

Dealers

of the best and the cost is very moderate.

Philadelphia, New York and,Los Angeles
1529

Security

\..

Philadelphia and

System

FACILITIES

and

department for

Angeles Stock Exchanges

Private

Brokers

Our facilities

BUCKLEY BROTHERS
Members New .York,

transactions.

Pennsylvania

Men;,o on Request.

offer

Thursday, October 5, 1944

PHILADELPHIA

Philadelphia

Teletype

New York

Rittenhouse 2580

Corp.)

PH 70

BOwIing Green 9-8184

yV-

Philadelphia Bank Stocks
<

Central-Penn National Bank

Hearings before the S. E. C. in reference to Standard Gas &
Co.'s voluntary plan of reorganization were concluded laSt
Saturday. While no staff, report or opinion is as yet available,. from
the character and quantity of evidence and testimony presented by
various-interested groups, it appears to be more than possible that

Fidelity-Phila. Trust Co.
Girard Trust Co.
Penna. Co. for Ins.

Lives etc.

the

Phila.

Locust

New

York

HAnover

1477

Amer. Insulator

dends

were

have

been

choice"

General Phoenix Pfd. Stks.1

not

Under

"directors'

matter

neces¬

dividend

priority

conform

with the

Commission

CAnal

able

does

principles of

the

other -compar¬

cases.

WASHINGTON

To support

these vieWs, the fol¬
lowing were cited:
I ;• :
Holding Company Release No.
.

4215

(United Light & Power Co.)
our
view, it is not incon¬

—"In

sistent

Inland Gas
Gy2s 25%

Court

affected

participation

•given

Paid

their

contractual

tion

set

other

not

its

Bell System TeL

WHitehall 4-2300

:of

sence

litigation, and does not

require compensation to the pre¬

PHLA 591

ferred Stockholder

for

the lapse
precede pay¬
;/-vvW r!
Holding Company Release No.
5114
(American Utility Service
-Corp.)—'We have repeately held
in reorganization cases that pri¬
mary weight must be given toearning power.".
of time which may
ment."

Columbian Mat. Life
American Investment
Securities

(Me.)

;

Bought

Sold

Quoted

—

the

Philadelphia

AND

Established

Mertibers

CO.

T923

with

Philadelphia'Stock Exchange

Land

PHILADELPHIA

Telephone

10,

PA.

Rittenhouse 3940

Bell System Teletype PH 380

East

Justices

df the

Supreme

in part:

"We

Hurd Coal

Iron

in¬

increase

not

became

sought

increase

With

rates.

the

legal

consequence

(Continued

Smokeless

Coal

Com¬

Fire

Coal

Co.

Creek

Pembertcm Coal & Coke Co.
To no pah Mining Co. of Nev.
BOUGHT

—

SOLD

—

QUOTED

WM.W.FOGARTY &C0.
Established 1919

Lafayette 'Building
PHILADELPHIA 6, PA.
.—.fiuno

Teletype 'PH 240

excess

those of last

$5,000,600,

$15-000,000 cash

now

Pittsburgh Railways Trustees.
It is believed that these factors
will receive careful study

Total

Revenues

'Railwavs

'Co.

for
and

Pittsburgh Motor Coach Co., for

been, the

nue

Chester

mu¬

business

This

and

firmness

these

liberal

Exchange
Weekly Firm Changes ;

The New York Stock Exchange
has announced the following firm

ity

case

improvements

.understood
become

will

that

Mr.

associate
&

.+ 13.3

W—' 176,640

-158,172

+ 11.3

-191,236

169,841

+ 12.6

has

Co.

bond department,

•

of the

uncertain¬

exist at the present

eliminated, it

are

consensus

opinion

the l

that

the "•

municipal bonds market will

re¬

main quiet and inactive.

PITTSBURGH, PA.—The Bond
Pittsburgh announces that

Club of

it will hold its annual fall outing
on

Wednesday, October 11th, at
Shannopin Country Club, Ben
Golf, La Bouche, and door
prizes will be features.
Dinner
the

Avon.'

will be at 6:30 p. m.

$1.00

Tickets

are

for

members,
$5.00
for
guests. Because of the problem ef
food, members are urged to make
their reservations well in advance.
Reservations should be made with

and
the

Co., Inc., chairman of the enter¬
tainment committee.

lends to the possibility that
outstanding bonds might be

is@

■

refunded;
:

River Joint Commis¬

Delaware

sion-Philadelphia Camden Bridge
2.70s, due Aug. 1, 1973, callable at
105 in August .1946, have been in
demand by
the quality buyers.
,

These

yield
and

bonds, selling around 108,
1% to the first ■call date

about

With

2.30%

the

huge

maturity.
reserve

ac¬

PHILADELPHIA, PA. —Arthur

Rea, cashier of Buckley Brothers,
1529
the

Walnut

New

Street, members

Los Angeles Stock
been

York, Philadelphia and

Exchanges, has

placed in charge of the firm's

Los Angeles

office, 530 West Sixth

Street.

count and substantive revenues,
bonds

should

investment

trust accounts.

be.

for

that the account With the

block

these

at¬

bonds,

past couple of months, has been
terminated.

gmaller

PHILADELPHIA, PA.
F.

Miller

has

with Paul &

become

igr.
—

Paul

associated

Co., Inc., 1420 Walnut

Street, members of the Philadel¬

There has been considerable re¬

§ O®, Sales

large
which

have been In the market for the

with

waiiis

certain

It is understood

municipal| tail merchandising -of
y

market

Joseph Buffington, Jr., Young &

extension

was

some

ties which

time

the

be in the same manner as before

their

Until

out

quiet way.

Co., 220
Broadway, New York City, mem¬

Turnpike, west from Pitts¬
burgh and from Harrisburg to
Philadelphia.
This, of icourse, is
post-war • planning, but it
does
appear very likely.
The financ¬
ing -of the project would no doubt

about the

the"

tractive

Bros. & Hutzler and

considerable

been

move

rather

discussion

Partnership By Viner

AU«n

0.9

143,252

mon

Chungc

•

'$153,304

162,294

these

Viner

for the

C-i-

Hunt

New York

follows:
1943

May'A-.i $154,627

There

odd-lot

314s

the

Author¬

revenues

1944

August

Jacquelin,

„

as Allegheny
County, Pittsburgh and Philadel¬
phia have been very inactive.
There has, however, been some
fair-sized blocks of Philadelphia

con¬

revenues.

last four months

active Penn¬

the steady

usually

July

October 11.

Carlisle

broker for

Edward

The

sylvania names, such

••

June

bership of the late William de
Young Kay to Gregory C.f Hunt
will be considered

-of

comparison

changes;4

'••.•••• v*'■
Transfer of the Exchange mem¬

well

314 s

yield

bonds

of New York

Port

Authority3s and

about

other tax-exempts;

the

Margolis To Be Admitted
'

re¬

•'y.

.•

..yy'■

to the

given by

Revenue

1.75% return

date

market

trast to

}

•...•

call

due

Municipal

Borough Municipal Authority—Water Revenue 3s.

affording the inves¬

first

Municipal

Water

approximately
the

;W':'.y;:' ■•"'■V',.

Latrobe

a s

dried : up

not

Authority—Water Revenue 3s
and 314 s
'■ '■

County Munici-'
Authority—Water Reve-.

West' View:' Borough

'♦

it has

doubt

'Operating

T"u"u,",4\

nicipal bo

1467)

on page

y 5yy,

pal

ampunt of

quiet

that

by the bers of the New York Stock Ex¬
approving, disap¬ change; will admit
Ely Margolis
proving or suggesting revisions of to
partnership in the firm on Oc¬
the Standard plan.
tober 19.
Mr. Margolis .formerly
was proprietor
of Ely. -Company.
Pittsburgh Railways Co.
Prior thereto he was With Salo¬
Commission

tain

Westmoreland

a cer¬

'caution.'

New York Stock

September 22.

the

held by the

-ate with

Arthur A.

Moreover, Philadelphia
Company has a stake, probably

Co.

Leckte

oper-

recent favorable tax decision in

t; Revenue 3s

■

3.20% to maturity.

remaining in effect, it is

recently:

;

should

tor

existing

year.

Leckie

investor

the following
just about liq¬

been

Hazleton City Authority—Water

and the dealer ;

109 to 109

manifest,

the

be Comparable

Co.

have

uidated

I Commonwealth of . Pennsylva¬
nia^ Turnpike 3%s, 'due. Aug. 1,
1968, callable at 104 in August
1947, have remained firm around

un¬

Sugar Loaf Coal Co.

reason-,

able that both

Blocks

names.

bonds

special features in

Philadelphia Company, Judson in Judson & Co., New
is the Pittsburgh Railways Co.
York City, ceased as of Septem¬
and subsidiaries, operated -.under
ber 16.
Trusteeship since 1938. The Phila¬
Interest of the late Victor. S.
delphia Company's equity in. the.
Byron in Johnson & Wood, New
adjusted net income of Pittsburgh
York, ceased as of Septemberr30.
Railways for 1943 was'stated as
Interest of the late Harlow W.
$2,355,165.
Young in Lawrence Turnure &
Results for 1944 are said to
Co.-Blyth & Bonner ceased as. of

Title Building

seems

-it

ago

years

KENNEDY

ail,

company

City. Blaicher, special part¬
pany as to be, eventually, the only ( ner in
Coggeshall & Hicks, New
subsidiary .of standard, the for¬ York City, becomes a general
mer's
earned .surplus
and pro¬ partner in the firm effective Oc¬
jected -earnings are matters *af tober 10.
important consideration.
Tied in'
Interest of the late Elizabeth M.
Since

Wolverine Power

tain ties which

the Commission and the learned

dividend arrearages does not con¬
stitute a matured claim in the ab¬

Philadelphia 7, Pa.

fare increase.

derstand that the transportation

has

rights

permitted
to mature liquidation preferences
i*. The accumulation of preferred

CfRSTLEY, SUNSTEIN & CO

However,
sought

was

company's earnings have

should

Su¬

War is .near; the Presidential campaign with its
many, political proh-;
next month, and the many;
other
uncer

cent weeks.•«.);.

The

according

two

Court stated,

that

as though
in a con¬
enterprise, and that the
of compliance with the

statute

Ctf.

New ¥ork Phone

valuation

State

levels,

be'

should

213 So. Broad St.

$93,000,000 valua¬
Philadelphia, Trans¬

lower

rates

process

St.

rejected'appeals

portation Co.Vby -:the
perior Court.

tinuing

Reading

Coal & Iron
5s

week

review of the

determined

Phila.

last

.of the Public Utility Commission
and the City of Philadelphia for

creased that the company; aftfer

conclude that

stockholders

31,
'Xy

P. T. ,C. Valuation
Pennsylvania
Supreme

T h

portation

the
not

approved

lems; the coming War Loan Drive due

the trans¬
compiiie tel y.
requested;;; a Special situa¬
higher schedule of fares.based on tions ha v e
sharply increased operating .costs
Russell M. Ergood
kept many of
Almost
coincidentally with the the d-e a l e r s
institution of these proceedings;
occupied.
Pennsylvania Munici¬
the company's revenues began to
pal Authority bonds have been
rise and have remained at high
one of the

the

which gives

arrearages,

allocation

Phone
Pennypacker 8328

and

concern

plan,

December

By .RUSSELL M. ERGOOD, JR.

Inactivity and dullness prevail in the Pennsylvania Municipal
Market as is the case in the general municipal market.
This is not
surprising to municipal dealers, many of whom having anticipated
this period of ■ apathy.
When we consider the end of the European:

pre v

About

going

preponderant

1500 Walnut St., Philadelphia 2

1st

ended

;

w h. bell & Co

BOSTON

months

of P. T. C. to seek

Company's

30.

Standard

ran,

June

by the Commission and the City
block any moves. on the "part

circumstances,

such

argument

ended

must be considered in the light

Citizens Utilities 3s 1955

N. Y. Phone

.paid ;was:held to

rather

than

contem¬

was.

:;V.\. V'.'1'"'-/

the

Southwest Pub. Serv. Com.

1943.

The fact that 'divi¬

sity.

Lehigh Valley Transit 5s 1960

had

It.

months

and;

power-

not been paid since 1934, earn¬
ings in each year .since that date
have more than covered (dividend

requirements.

presently

1944, were reported as $21,400,605,
compared with $21,292,180 for the

$6 prior'preferred dividends have

Autocar Com. & Pfd.

Teletype

the

pointed *out that while the $7 and;

Phone
2-2280

Teletype PH 257

Stan¬

low

were

earning

under-estimated.

been

Philadelphia 2

Phone

future

that

IT. N. NASII & CO.
1421 Chestnut Street,

of junior secur¬

valuations

dard's

allocations

v.f

to indicate that

arguments

Common

Pfd.

disapprove the

ities introduced well-substantiated

Transportation Co.

2039,

may

WyV'.;:

; Several holders

Provident Trust Co.
3-6s

Commission

plated.

Philadelphia National Bank
Phila.

Specialties Feature Quiet Market

Electric

Corn Exch. Nat. Bk. & Tr. Co.

some

Pennsylvania

of the;

phia

Stock

manager.

Exchange,

Mr. Miller

was

Authority with F, P. Ristine & Co,

sales

formerly

THE COMMERCIAL &

Number 4322

160

Volume

DIRECT PRIVATE WIRE

Commercial Banking After War
financial

with bank

credit.

yri/y'y' V

growth in deposits before the
is over, and even a gradual
increase
immediately
after the
war would not be surprising.
On
the basis of the best information

ther

due serially

portion of Government issues as
they did in the two earlier years,
while other sections of the coun¬

war

large a pro¬

total.

the

enlarging

been

have

try

...

Members

view of

•

and employment in years
to come and so to advance or retard the attainment of post-war
security and progress. ; This is a

tivity
■;

;

for bank¬
in the
country. Before discussing the fu¬
ture of deposits from the bankers'
point of view, therefore, I should
like to discuss briefly the function of liquid assets in the years
immediately following the war.
matter of grave concern

•

;
<

other

all

and

ers

If liquid assets

lic

verted plants

•

becomes adequate to

•

Each

Private

judge

usual

shifting

regional

reduction

your

No Pressure for

been

court
tions

$500,000

City of

in the permissible rate

of earnings

Liquidation of
y
will be

After this war there

Bell

The

from

Co.

Telephone

for

>yy

the war.

war

communications

Co.'s

another

in bank portfolios is

now

steady as the Government it¬

self;

■

'{
^

Of more

filed

in
elimina¬

system

step toward the

3%% Bonds

down and out.

a new

fective Oct, 28.

of;Keystone, dial pioneer in
There will be no alter¬
ation in; service
to some 13,000
Keystone subscribers, but bills for
service will come from the Bell

Co.

Electric

nual

Price:

Commission, ef¬
The revised rates,

said, will result in an¬
savings of $535,954 to 134,863

company

this area?

vania counties.

Deposit Contraction i This leads to the question which
I am sure all bankers have been
immediate concern to

Moncure Biddle & Co.
PHILADELPHIA

■

in the

J. Malcolm Johnston,

contrary to

Phila. Real Estate
Securities

vice pres¬

Trust Co., has
director of River¬

Girard

been elected a

its re¬
of divestment, Unit-i
Improvement Co,, through

Somewhat

ident

U. G. I.

side Metal Co.

Phila. Transport'n Co.

•

all

cent program

Investments

959

units

year

ago.

Government

fund's

30.7% of the
portfolio;
corporation

bonds,

business
have

/'yy

/;•;,

Members

Philadelphia Stock Exchange

Packard

Bldg., Philadelphia 2

;N. Y. Phone

Teletype

Doffs President

Investment Traders Elect

REctor 2-0037

PH 375

have

continuing interest in:

Southern Advance Bag
&

Paper Co.

Common Stock

BOENNING & CO.
1606 Walnut

St., Philadelphia 3
PH 30

Pennypacker 8200
Private Phone

N. Y. C.

COrtlandt 7-1202

Corporations

concerns.

set

—

27%.

v v PHILADELPHIA,
PA.—Russell M.- Dotts,- of Bioren •& Co., has
is the question considering. Is a rise in interest
going
to
bring serious been elected President of the Investment Traders Association of
business will rates
shrinkage in the value of Govern¬ Philadelphia for the ensuing fiscal year.
have to be adjusted to a lower
ment securities? My answer is re¬
level of deposits after the war. As
indicated above, I do not believe assuring. I think that the interest
rate on long-term Government se¬
that deposits will decrease after
the war.
Their wartime expan¬ curities is going to continue to be
Interest rates on either
sion has been due to the purchase steady.
of
Government
securities
by long-term or short-term invest¬
ments are not likely to rise while
banks, and this fact is of great
there is a large supply of invest¬
importance to bankers.
It means
ment funds such as there will be
that
deposits will not diminish
after the war. Liquid-assets will
unless
the
banks reduce their
be in large supply not only in the
holdings of Government securi¬
hands of individuals but also with
ties.
There is little likelihood of

large

reserves-

for

reduction in
post-war contingencies and in¬
bank holdings of Government se¬
creased their bank deposits andcurities
would
have
to
come
holding's of Government securi¬
through rapid contraction of the ties.
This does not mean that
appreciable

,:•/<

Samuel K. Phillips & Co.

whether the banking

issues

21.8%; preferred stocks,

20.5%, and common stocks

consideration is reported

Fi¬

bonds represented

Edison Coi
The

delity-Philadelphia *• Trust Co.'s
discretionary
common
trust
reached $16,552,796 on July 31,
1944, compared with $13,837,-

bank management

such action.

Interest

1.85%

Keystone's private-wire trad¬

ing boards are widely used
financial section.
Brokers

120.678

To Net

Pennsyl¬

customers in 15 western

1975/62

Coupon Form

has

rate schedule with the

Utilities

Public

-Philadelphia

long way

.'-j

No Danger of

■

is still

Pennsylvania

tion

ed Gas

Act,

Clarence M. Brown, 75, Phila¬
won't delphia attorney, has been re¬
called as chairman of the board
mind "receiving their bills in Bell
of Pittsburgh Plate Glass Co.
envelopes, but they would much
1920's.
prefer Keystone rates.

for liquidation of bank
there was following the
and the speculative ^se¬

pressure

curities

under the

beating

January

erating as a motive for liquida¬
plished.
If, on the other hand, tion; This is different ffrom; the ; its subsidiaries, Allentown-Bethliquid assets swell the volume of situation after the last war,-when flehem Gas Co., v and Harrisburg
hasty
and
indiscriminate pur¬ bank assets deteriorated as com¬ Gas Co., has taken steps' to ac¬
chases by persons who are weary
modity prices declined, or in 1929, quire gas properties and facilities
of
war
restrictions, the result
in Northampton and Berks and
when there was great pressure for
could be a disastrous inflation. It
Lancaster
counties.
Purchases
the liquidation of security loans
is for this reason that some of the
will be made in dhe names of the
based on swollen values.: The in¬
restraints on prices, wages, and
subsidiaries ? from
Metropolitan
herent value of Government se¬

should be retained
least a short while after

provisions of the Holding Com¬

thereon."

pany

Co.
no

accom-

consumption

taken

has

G. I., which

$1,425,000.

^differed in their valua¬

Exchange

PITTSBURGH

(Continued from page 1466)

•

/rV/'riv;Assets

assets

of funds
aggregate

the

deposits.

last

judgment

make allowance for an un¬

need

believe

not

•

Pennsylvania Brevities

Pennsylvania has taken over the
conditions and I operation of Keystone Telephone

of these

demand, these

has

1518 Locust Street, Philadelphia
•<
telephone wires to New York and Baltimore

of you will be your own

one

the difficult task of

reconversion

•

held by the pub¬

posits within a community is the
of competitive conditions
with which
I am not familiar.

assets will curity movement in the
re-estabSince Government securities com¬
lishing full
employment on a
prise by far the greater, part of
peacetime basis and act as a safe- the increase in bank assets since
guard against deflationary forces the war.
began, there will be no
that might threaten stability after
fear of deterioration in value op¬

ease
"

groups

utilized only gradually as
flow of goods from recon¬

; meet

Stock

Investment Securities

result

are

the

Pittsburgh

Rambo, Keen, Close & Kerner, Inc.

Reed, Lear & Co.

2.10% to 2.25%

price to yield

their

this early adjustment of some of
the
major wartime shifting of
believe that when
funds, it seems likely that there
peace comes the volume of depose
will be no wholesale movement of
its will be between 125 and 150
deposits from one region or dis¬
billion dollars, and the volume of
trict to another immediately after
currency between 20 and 25 bilthe war.
,:C?■.
lions.
The disposition of this
Every banker will of course
enormous amount of liquid funds,
have to look to his own individ¬
and of the billions of dollars the
ual situation.
Some banks will
public has invested in Govern¬
lose deposits and others will gain
ment securities, will help to determine the level of business acr them. The interbank flow of de¬

1/1/57 to 7/1/09

available,

•

2% % & 2%

Electric Revenue Bonds

■

been buying

not

;

probably be a fur-

will

:There

the capacity, have

near

f^NEW YORK CITY

of Nebraska

extended

having

areas,

District

Consumers Public Power

(Continued from page 1461)
its, for when banks buy Govern¬
ment securities they pay for them themselves

1467

FINANCIAL CHRONICLE

Pennsylvania

•

public debt or through extensive
particular industries or firms will
sales of bank holdings to the pub¬
not have to raise funds, but it
John M. Hudson
Alfred W. Tryder'
Russell M. Dotts
lic. I believe the pressing prob¬
does indicate that the broad prob¬
lems which will confront us after
lem for bankers is likely to be
Other officers chosen are: Edmund J. Davis, Rambo, Keen, Close
the war will prevent the Govern¬
how
to
find enough
profitable & Kerner, First Vice-President; Alfred W. Tryder, W. H. Newbold's
ment from reducing its debt im¬
outlets for available funds.
They Son & Co., Second Vice-President; Frederick S. Fischer, H. N, Nash
mediately, and that the public is
are not likely to be-under pres¬
& Co.,
Secretary, and John M.<s>
———r——
much more likely to want to sell
sure to sell Government securities
Hudson; Thayer, Baker & Co., gold stars in memory of Harry
some of its bonds in order to use
in order to meet demands of cus¬ Treasurer.. ;
'
Harper and Eddie Atkins. ;
the cash than it is to buy more
tomers for loans.
Governors
elected
for
threeTreasurer John M. Hudson re¬
bonds from the banks.
In short,
There is the additional fact that year terms are: Charles J. Bren- ported a cash balance of $911.93
I believe the banks will continue
to a large extent bank holdings non;
Robert McCook, Buckley in addition to $500 in U. S. Sav¬
to hold their Government securi¬
of
Government
securities
are Brothers; W. J. McCullen, F. J. ings Bonds.
ties and hence that deposits Will
Morrissey & Co.; Paul Fredericks,
short-term in character. Over onenot diminish.
"
third of all Government securi¬ Warren W. York & Co.; Samuel
There will be some shifting of
ties owned by banks will mature K. Phillips, Jr., Samuel K. Phillips
deposits from region to region, in one.year, and a Security .hav¬ & Co., Inc.; Charles L. Walling?
Ross Gear & Tool
but I do .not believe it will be
ing only a year to. run can not foid, E. H. Rollins & Sons, Inc.;
Penn. & N. Y. Canal & R.R.<
very extensive. With the wartime
depreciate much in value.¥ About for two years: Wallace H. Runyan;
4s, 4%s & 5s
'-J
growth in deposits, which has 'three-fifths Of all member .and Graham; Parsons & Co.; for one
been
proportionately smaller in
Lehigh Valley R.R.
nonmeipber bank holdings Will year:, John P. McFadden, Smith,
•'
Ann. 4^2 s & 6s
the financial centers than else¬
Barney & Co.; and Harry Fahrig,
mature within five
_

and NewJersey

Municipal Bonds
Dolphin & Co.
Fidelity Philadelphia Trust Building

PHILADELPHIA 9
Telephones:

•

and only
where, there has been a net move¬ 14% of the total have maturities Jr., Parsly Bros. &! Co. : ♦
ment of deposits away from the
The election was held in con¬
of ten or more years.
Long-term
large financial centers into the bonds in bank
portfolios are much nection with the Association's an¬
producing areas for the reason smaller in volume than are time nual meeting and dinner on Sept.
that tax collections and sales of
29th at the Benjamin Franklin
deposits and they are little In ex¬
Government
securities
in
the cess of
capital. The distribution Hotel. The additio# of eight new
money markets haye been greater
Of maturities, in addition to the members brings the active list to

Philadelphia—Pennypacker 4646
New

Bell

York—HAnover 2-9369

System Teletype—PH 299

Complete Investment
and

Brokerage Services

years,

Government
expenditures
there.
This movement was more

quality

pronounced in 1942. "than in 1943
arid: is • no longer taking place. The

prospect of relatively low interest ^S'lu the
(Continued on page 1471) x " * sociatiorfs

than

the

security and the

182, exclusive of 49 members servarmed forces. The Asservice flag carries two

Rakestraw, Betz & Co.

Harris-Seybold-Potter
Common

Members

Parker

Appliance

New York

Stock Exchange

Philadelphia Stock Exchange

Penington, Colket & Co.
123

Broad

St.,

Philadelphia 9,

New York Phone

Penny packer 7700

Hanover 2-0310

Teletype PH

180

123 S.

Broad St., Philadelphia 9

Pa.

Phila. Phone

PhiIadeIphiaTelephoneKingsley3311
New York Telephone Hanover 2-2280

1468

THE COMMERCIAL

& FINANCIAL

Reconversion
aircraft of various sizes in domes¬

without

must

if the aircraft

overcome

Let

production.

One

their scope.

measure

times

':'V;''1

the

wisest

that

govern¬

•

which with
as

completely

evitably contract
time of peace,

placed to

any

very

five

level

that

can

95%

will in¬
greatly in

J. A. Krug, the
of the War Pro¬

Chairman

duction

Board, has estimated that
this plunge may reach 1/10th to
l/20th of the present rate of op¬
erations.

considered

exactly accurate estimate of

most

size

which

manner

whatever
normal

level

can

could be

For
the

had

carefully

the

and

ex¬

privately-owned plants
Government-owned—finally

the tangle?

Fortunately, no one is seriously
proposing that the Government
operate these facilities. Certainly,
the

industry could not face such

competition.
Third

repercussions

our

Air Power and supplying
employment
in
the
postwar world.
But the problem
substantial

the matter

of contract

the

problems

serious because the stakes are

high but they

solved

can

sound policy

and intelligent administration.
Fourth is the matter of main¬

taining research and development,
only
during
the
difficult
period of readjustment but there¬
not

The cost will not be low-

after.

takes

velop

large

millions to

air¬

ments for a year—but the return's

will

the

tremendous.

keystone

arch of

whole

Research

which

aviation struc¬

our

ture, both military and

commer-

Cial.

Spectacular though
achievements

only in the

may

wartime

our

seem,

curtain has lifted before
the

first

time

our

Much

sketched, because we know
similar problems were not
handled very successfully a gen¬
eration

Back
also

1919,

the

confronted

with

fleet

transport

2,500

serious, other thousands of

cluded,

and

payments

promptly

planes.

The toll recorded

following

alarming to
those of us who are studying far
more challenging problems today.
Let us count that toll; Not only
did many companies go out of ex¬
istence

the

but

and

research

de¬

velopmental staffs of other com¬
panies were largely absorbed by
the

automobile

and

other

indus¬

It is

interesting to note for
example that Charles Kettering
was
in aircraft work during the
'

Surplus planes of the last war
the growth of aviation

retarded

for

tion

field

in the form

pulsion and radar.
friend,

Bob

have

jet

pro¬

quote my

Lovett—"Everything

done

far

prelude to the future.

only

Even

now,

battering on the door of
speed of sound."
When jet
propulsion and new airfoil shapes
we

are

the

enable

to crash

knows how fast
The

through

industry

can

go.

enabled

retain

brains and to

must

their

that America, takes
new

Those of

research

cer¬

developments.
who recall the

after

time
types.
The
mountainous
stockpile of Liberties smothered

all

engine

was

still

illand

research!
The Army
using World War DeHav-

observation

could not sell
new model
engines,
technological
develop¬
ment was retarded throughout the
early 1920's.
model planes

that

believe

will

not

re¬

the unfortunate experiences

peat

the

last

lessons

We have learned

war.

from

previous mis¬
planned well in

our

have

and

advance

for

upon us.

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

late

as
.

Since the industry

now

only
not an

planes

1930!

takes
ex-

85%

1918,

all

the lead

For the

decade.

years

private planes sold were jCurtiss Jennies, 01* similar war¬

the financial

secure

five

new

Government

and

establishments

research

no ope

than

first

The

the

years

the

problems which

recognize that the effective
of

reconversion

This announcement is

aircraft

industry that had undergone a
sharp expansion from previous
levels, and with a huge surplus of

are

force;

''V-,'?
nation was

ago.

we have seen
tal hew inventions enter the avia¬

decades,

in these

V-Day.

I have

just

that

eyes,

nearly two
fundamen¬

tain

con¬

are

war

early stages of last world war and went to Gendevelopment.
It is not eral Motors with Day ton-Wright.
generally realized that the im¬ Had his
genius been retained in
provements in aircraft in the last
aviation, our technical progress in
15 years have been chiefly due to
subsequent years might have been
improved detailed design.. Now a far more marked than it was.

If equi¬

cannot

last

the four problems

aircraft

settlements

are

the

after

deeply concerned about the solu¬

very

table

are

With claims

perience
tion

tries.

weeks'after termination.

will be surplus

uses

solve.

the

rests

support necessary to make it

de¬

trans-oceanic

plane; 35 millions to operate our
large: basic research" establish¬

termination.Here
are

ing

For

How to unscramble

little

fulfill their role in maintain¬

perhaps easier
so huge to
settle, a small mistake could wipe
out even the strongest concern in
the industry.
The industry's re¬
ports show that its working cap¬
ital is just sufficient to
permit
operations
to
continue
on
the
present scale for two or, three

and obsolescent

25,000 plane air

additions

companies

to-peacetime

example, if a few years after
war we

the

are

feet or 75%
Government
DPC.
Then

there

aircraft

craft not susceptible of conversion

reasonable.

seems

nearly

ernment-owned.^

ago¬

of figures

the
through
by

area,

machinery and tools in some
privately-owned plants are Gov¬

least, depends
be most serious.
to
a
very
large
degree
on
- Specific
the
annual
aspects of this overall
production of mili¬
tary airplanes—which in turn de¬ problem fall into four main cate¬
pends
on
the
nature
of
the gories.
peace
and
on' Congressional
First is the question of surplus
Policy.
However,
Mr.
Krug's planes. Tens of thousands of air¬
range

square

owned

also

the

jobs, upon developmental
staff, working capital and even
the productive organizations will

after the conflict at

this" vast

the

upon

industry

total

Central

area

million

there

nizingly drastic and sharp. Unless
the nation and the industry plan

;

the postwar aircraft
is naturally impossible.
Its' magnitude, in the first years
the

the

tensions of

shrinkage

return

the

outright

shrinkage takes place will be of
the greatest importance to the in¬
dustry and to the country.
The

sidered "normal."

market

matter

1939

132

that a 90% to
will be inevit¬

assuming
the

are

and cannot be rergreat degree by in¬

to come.)

able

con-

the

comes

times

Park.

•

Yet

the

space of the industry was
eleven million square feet.
To¬
day it is sixteen times that figure
—175 million square feet—six and
one
half square miles or nearly

creased commercial sales for many
years

Shall

max¬

floor

The de^

mahd

64,000.

material

wrar

machine guns.
for such products

tanks

It
was smaller then, than the 5-cent
candy bar business.
v ;
From its present lofty pfeak, the
industry faces a cold plunge to an

de¬

transport

surplus plants.

few exceptions are

new

Second,

policy supported by the
enlightened public opihion,
a shrinkage
of this magnitude is
inevitable.
(The aviation indus¬
try has been building products

ployees was ranked 44th among
American businesses in 1939, em¬

new

domestic

airplanes be
destroyed by this flood of surplus
equipment?
'
; :
. ..

most

the world's

ploying approximately

imum market.

last

mental

largest, with almost 2,000,000 em¬

well

for

recognize

must

with

even

quick assay of the recon¬
version problems of aviation, a
few comparisons are necessary.
now

production of the

Everyone

industry,

the

indicated

this

peace-time year, 1939.

that

but

industry..

uncertain

Estimates

to three times this estimated

manufacturers

This

foreign

then

that

can

probable

be ashamed of—it would be five

each day adds to the surplus that
threatens to inundate the airplane
For

the

postwar level would be nothing to

veteran

mobile

these

some

airplane man has
wryly observed that every day
that passes builds up a greater
backlog of demand for our auto;

But

estimates

mand.

estimated

disbursed,
chance

postwar
market
for
transport types range from 2,000
to
3,000.
And this
allows
for

1,100,000,000

1944

will

There are various cri¬

problems.
teria that

about

planes

of the surplus
transports that will await dis¬
position range from just double

examine

total

dollars—6%

provide maximum
employment in the postwar era.

transport

disposition.

Best

Thursday, October 5, 1944

And Air Power

immediate

would

industry is to

await

fic) ; and 150,000 private aircraft
(again five times our pre-war
total) our annual aircraft sales

the

•'

military

tic and foreign service .(sufficient
to carry five times prewar traf¬

(Continued from page 1458)
Air Age cannot be fulfilled
important action by the
public itself expressed in national
policy.
They do not understand
the obstacles and problems that
.

CHRONICLE

our

be carried out
coherent

industry can
on the basis

national- program

American first
program is un¬
development and- you men
who are here tonight can do much
to
insure if the public support
that will be necessary to put it
designed

keep

in the air.

Such

der

0,000,000

into
JT"

effect.

deals

with all

im¬

portant aspects of the problem-t-

planes and plants, con¬
termination, and the meas¬
necessary to retain our air

surplus

Arkansas Power &

tract

Light Company

ures

power

supremacy.

If America is to continue to be

First

Mortgage Bonds, 3H% Series due 1974
v-;/:,;

;

Dated October i, 1944

: ;

'•

W-!

; -J:'\:

f-(.p

v-"

air

have

composed

must

force

adequate

superior
competent personnel.
our youth to
fly and service airplanes.
3. We must expand our domes¬
tic and foreign air transportation,
and bur personal flying.
4.- We must maintain, a strong
aircraft
manufacturing industry
with continuing world leadership
in research and development.
Each of these planks is bound
up
inseparably with the others.

:y.;

j'Due October

air power, four funda¬
requirements must be met:

great

mental

aircraft and

I, 1974

2.~"We must train

.if ■■■■Price I
daccrued
na%.f/O

The Prospectus may

be obtained in

interest

v;: :

State in which this announcement is circulated from only such of the
undersigned and other dealers as may lawfully offer these securities in such State.
any

Perhaps the most fundamentally
important is the maintenance of
an adequate air force.
"A secondclass

—-v.-/,.' HALSEY, STUART & CO. INC.

that
of

A. C. ALLYN AND COMPANY
............

•

INCORPORATED

BLAIR & CO., INC.

CENTRAL REPUBLIC COMPANY

(INCORPORATED)

PHELPS, FENN & CO.
f

E. H. ROLLINS & SONS

'
.

INCORPORATED

♦

A. G.BECKER&CO.
.

WlLLIAM BLAIR & COMPANY

THE MILWAUKEE COMPANY
,

October 4,1944.

http://fraser.stlouisfed.org/
\
Federal Reserve Bank of St. Louis

(INCORPORATED)

■"

H. M. BYLLESBY AND COMPANY

INCORPORATED

OTIS &. CO.

SCHOELLKOPF, HUTTON & POMEROY, INC.
^

COFFIN & BURR

COMPANY, INC.

ARTHUR PERRY & CO.
INCORPORATED

•

■

'■

-•

HORNBLOWER & WEEKS

INCORPORATED

BURR &.

air force is

Vs.

HAYDEN, STONE & CO.
DEAN WITTER & CO.

worse

positive

it- may create'

than

use-

danger

false

sense

security..
A first-class
air
depends, upon quality, This
constant improvement and

force

means

replacement, It is therefore abso¬
lutely essential that our Air Force
be backed up by an aggressive
and imaginative industry capable
of rapid expansion." "
/
'
Mahan in his classic, "The In¬
fluence of Sea Power 011 History ■"
proved that victory in war and
prosperity .in peace went to the
nation that, controlled the sea.

Mahan,
Neptune's
trident
was
three-pronged — the Navy, the
merchant marine, the shipbuild¬
ers.
And Neptune stood on two

1469

Volume

COMMERCIAL & FINANCIAL

THE

Number 4322

160

bases and try has the responsibility of pro¬
viding -safe, convenient, efficient
a maritime tradition/
' ; '
V ■
Air power, too, has a trident^- planes. »Perhaps we can look to
the insurance companies for a lib¬
the Air Forces of the Services;
eralization of insurance practices
the aircraft industry; and a fly¬
and premiums.
From the banks
ing tradition nurtured by a pro¬
and
finance companies we can
gressive transport industry and
hope for financing plans that will
unfettered private flying.
enable the men who return from
Determination of what consti¬
abroad to purchase a plane in the
tutes an adequate air force, suffi¬
typical, convenient American
cient to safeguard our national
manner.
7
security, is a task to which our
Already, thanks to the efforts of
Armed Services are giving study
State education boards assisted by
now.
We can with safety assume
the Civil Aeronautics Administra¬
that they will have a blueprint to
tion, over half of our 28,000 high

firm foundations-'-naval

...

when V-Day

present to Congress
arrives.

;

7i••

schools

77! The decisions made by them
will determine the future of our

are

elementary

offering

pre-flight aeronautics as an op¬
tional course.- A system of Gov¬
ernment assisted flight training

They will do
in our colleges was well estab¬
so because military sales will be
lished before the war in the high¬
of paramount importance to the
ly successful Civilian Pilot Train¬
industry
for decades to come.:
ing Program which provided ele¬
With a 25,000 plane air force pur¬
mentary training for over 100,000
chases by the military each year
civilians before the, war and for
would be 90% of the industry
300,000 Army and Navy men dur¬
estimated immediate postwar
ing the war. The introduction of
sales, even assuming a very rapid aviation education by the schools
country in the

increase in

air.

the sale of commercia

private planes.

and

military

dependence on the

The

will, of course, lessen as time goes
on.
We can, for example, feel en¬

should

rying out of flight

and to prosperity.

generally

last

the

time

German , and
last round

after

when the

lasit. Jap with our

the

the first

year

detailed allocation and

two

disposal of

I believe that.this pol¬

materials.

buyer is in a position to

of
ammunition
and
our
last purchase a new airplane.
This is basically the solution of¬
plane," but it is obviously impos¬
fered by the Government's Sur
sible to estimate
our needs so
closely in time of war when the plus Aircraft Advisory Commit¬
tee.
The matter of surplus plant
national safety is at stake,
t,
Surplus aircraft for which there disposal is also an important one
from the standpoint of the future
is a reasonable market during the
of the industry.
A large propor¬
.immediate postwar period should
tion of
our
aviation • plant has
be sold during that period at fair
been built especially for war pur¬
prices so that they may help to
and the most optimistic
develop aviation, but the cardinal poses
forecasts of the future of com¬
point to remember, is that a large
mercial'and private flying does
surplus must not be kept over¬
not indicate a sufficient volume
hanging the market indefinitely
to make it necessary to use/this
as was done during the last war.
This permanently
overhanging plant at all. It is also true that
a large proportion of the. Govern¬
surplus -.would effectively stifle
ment-owned
factories were lo¬
development and research.
cated for strategic reasons in the
What are the possible uses for
our surplus aircraft?
Contrary to central portion' of the country
away from the home plants of the
popular belief, a very tiny propor¬
manufacturers which by and large
tion of those which we will have
are located on the coasts.
/ : •
on hand
on V-Day will be suit¬
It
would
seem
equitable to
able for civilian use..
Since 1939,
make these; plants available for
we
have built some 220,000 air¬
use
by the aircraft industry as
planes of which 16,000 were trans¬
needed and in fact a majority of
ports and 54,000 trainers.
Of the
the manufacturers have an option
combat
machines, practically

icy is accepted by Government as
sound and is being,put into effect.
These
then are some of the

steps that must be taken to facili¬
tate the orderly reconversion of

aircraft

giant

the

industry

peacetime operation.
If we can be assured of con¬
structive handling of these stag¬
.

geringly serious problems—
If
surplus
plane plants
are
turned over to private industry,
•

kept in "stand-by" condition as

defense measure;

planes are disposed of
policies that will pre¬
vent, .the smothering of .research,
If surplus

in line with

and. employ¬
followed the last
v; ■•7 ■ :;■:« .';y
sales

development,

such
war;' '/•ment,
If

as-

contracts

are

terminated

prompt manner
with due allowance for the scanty
cash reserves of the industry and
efficient, and

the need for

quick reconversion;

the maintenance and expan¬

sion

of industry, and government

research

are

encouraged;

If the nation adopts a policy of
commercial to purchase the Government
plants in which they are operating. encouraging flying, both in regu¬
utility. Bombers cannot be used
If they are not needed for aircraft
economically
as
transports be¬
larly-scheduled transport and in
production they should be made personal planes;
cause of their small fuselages and
available to other industries for
to convert them to transports by
THEN one must be optimistic
which incidentally many of them
building new fuselages is econom¬
about the future of this nation's
are not suitable
because of their
ically unjustifiable when the sur¬
Air Power and of its national se¬
special construction. It is also pos¬
plus; of military transport types
curity. Fulfillment of these con¬
sible that if they are not used
far exceeds the probable market.
ditions will also insure that the
Similarly
among
the
training either by the aircraft industry or aircraft industry will take its
other industries, they might be
types only a tiny fraction are suit¬
place as a major supplier of good
It would,
able for use by the private owner.-! kept as standby plants.
paying jobs.
of course, be most undesirable for
The vast majority are relatively

will

none

training in the

colleges resumed.
.7 iff.;..
The
colleges and schools

tirely confident, that air transport
will make its contribution to Air

•

are

enthusiastic about our
and training work.

educational

They need only assistance and di¬
rection to make their vital con¬

have

any

7]
familiar with the
tribution to the attainment of the
vast - expansion v plans
contem¬ Air
Age for America.
.7'/
plated by the airlines, plans which
But the preservation of the in¬
the
most conservative students
dustry in a healthy condition will
believe
will, within a decade,
require more than the maximum
result in an industry eight times
I
believe that public opinion
possible market.
It will require
any of these factories to be oper¬
as large as it was in 1941; Already
open cockpit
will make possible the adoption
that the industry not be smothered high; horsepower,
ated by the Government in com¬
the airlines are beginning to place
aircraft which will be too expen¬
with the surplus and termination
of a policy that will provide these
orders
for the new equipment
sive : to operate in anything but petition with private industry and;
essentials.
Earlier I quoted Mr.
problems previously outlined.
no plan for Government operation
that will enable them to fulfil
With regard to surpluses, the military training programs. - It is
Krug's realistic if gloomy fore¬
has been put forward seriously.
the schedules they plan.
(One
in the field of military transports
cast about the plunge that
lies
principle must be recognized that
As to the final war time prob¬
company
already has unfilled the vast majority of the aircraft that our war built airplanes can
lem of contract termination, the ahead of the aircraft industry. But
orders
twice
as- large
as its
find a peacetime use and even
with which we will find ourselves
there are optimistic forecasts too.
pre-war
peak.)y The CAB is at the end of the war will have here the number on hand seems problem is to complete the neces¬
1 am an optimist. I believe that
sary
negotiations and examina¬
actively under way with the hear
no further use.
They are war ma¬ likely to be two or three times the tions as
the
adoption of sound national
rapidly as possible so as
ings which will settle the mnu
terial as much as bullets or shells probably maximum market.. .
policies will stimulate American
It seems
desirable that these to make available to the. compa¬
merable "controversies
that in¬ and it is inevitable that we should
aviation to a progress which will
nies the funds they need for con¬
evitably arise in connection witn have a large amount of such ma¬ transport aircraft be made avail¬
be far beyond any estimates which
to
postwar production.
able either on a lease basis or on version
the domestic and foreign route
terial left over when the peace is
can
be
factually
substantiated
What is needed is a fast final fi¬
an installment purchase basis, the
extensions which will be neces¬
signed. In the words of an emi¬
,
/
nancial settlement divorced from today.
sary to make its expansion pos- nent officer, "We all wish that we arrangement to be canceled at any

Power
-

the car¬

be expanded and

kill

could

CHRONICLE

All of you are

-r

extremely knot¬
ty, and some rather spectacular
issues that must be solved but my
intimate acquaintance with the
Federal officials and members of
•

There are many

who are pondering

Congress

problems imbues me with
dence that they will be
in

manner

rapid

and

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

This announcement is not an
The

buy these securities.

these
confi¬

that insures healthy
growth for our air

industry. 7
The
development of private
flying may« well be even more im¬
portant than the development of

$31,500,000 -'

transport

transport as an

air

The

intermediate

example, re¬
the sale of only 6,000 per¬
aircraft at $1,500 each to

market. It

quire
sonal

First Mortgage

equal our annual pre-war sale of
transport airplans.
ThedevetoPment of
a

sales to
will require

Due

Dated

of
mproved
manufacturers, a
task they can be relied upon, to
perform. Second, and equally im¬
portant, it will require the pro¬
visions of additional airports.
•
Statistics reveal that during the
several years prior to our entry
into the war 80% of all those who
purchased planes sold them within a vear.
One important reason
for this was the lack of suitable
landing V-places. > It is . estmiated

September 1,1944

I, 1974

the

that there are no

Price

The
Prospectus may

ioy.08% and accrued interest

be obtained in any State in which this announcement

undersigned and other dealers as may

existing in this

The Civil Aeronautics
Administration believes that the
country will need at least 3,000
more iri the next five to ten years.

country.

airport
program to the Congress which if
approved will meet this need.
It is the belief of the aircraft
industry,'A belief which I share,

BEAR, STEARNS &

HALSEY, STUART & CO. Inc.

* EQUITABLE SECURITIES

CO.

CAA is presenting an

personal flying

new era,

portation in
unless

isne^tert^s!

automobile trans¬

as was

There

facilities

for great

other steps
to encou™gf

should be taken
vate

are

advancement will not be
are

flying.

HEMPHILL, NOYES &.
L. F. ROTHSCHILD &

SPENCER TRASK &

OTIS

CO.
,

(

CO.

The aircraft

that
P*1;

indus¬

DOMINICK &

GRANBERY,
October 5,1944.

CO.

.(INCORPORATED)

CORPORATION

'PHELPS, FENN &, CO.
&
'

SCHOELLKOPF, HUTTON &. POMEROY,

CO.

1913-1914—but that

landing

planned promptly, an
part of . the foundation
aviation

is circulatedfrom only such of the

lawfully offer these securities in such State.

mor.e^hf]n3^

landing fields now

that

September

development

tvpes

The

Bonds, Scries A, 3%, Due 1974

personal aircraft

really high volume

the

Narragansett Electric Company

would

DOMINICK

MARACHE & LORD

E. H. ROLLINS & SONS
INCORPORATED

SHIELDS & COMPANY
DICK &, MERLE-SMITH

TUCKER, ANTHONY & CO.
WILLIAM BLAIR &. COMPANY
IRA HAUPT &. CO.

INC.

GLORE, FORGAN &. CO.

BURR &. COMPANY,

SWISS AMERICAN

INC.

CORPORATION

1470

THE COMMERCIAL & FINANCIAL

litv.

Vice-President,

Companies Ass'n

Elects To Committee
The National Association of In¬
vestment

Companies

announced

the election to its Executive Com¬
mittee

dent,

Shawmut

Bank

dent,, The

Investment
Trust;
and
Dorsey
Richardson,' Vice-President, The
Lehman
Corporation.
All
four

of Hugh Bullock, Presi¬
Dividend Shares, Inc. and

Bullock

Fund, Ltd.; Paul C. Cabot,
President, State Street Investment
Corporation; Frederick A. Carroll,

were

elected

for

three

the

CHRONICLE.

Adams. Express.Com¬

tfM. Mutual Funds

Edward

C. Johnson, ; 2nd;
Vice-President and Treasurer, In¬
pany;

corporated

Investors;

Hugh W.
Long, President, Manhattan Bond
Fund, Inc. and New York'Stocks,

year

term

Thursday, October 5, 1944

commencing Oct. 1, 1944.
continuing to serve on Inc.; Jonathan B. Lovelace, Presi¬
the Committee are O. Kelley An¬ dent, The Investment
Company of
derson,
President,
Consolidated America; S. L. Sholley,
President;■
Investment Trust; Hugh B. Baker, •Keystone Custodian
Funds, Inc.;

In the mail last week

Those

received bulletins from three leading

Keystone Corp., in

recent is-<t>———*—•■■■■.

of Keynotes, shows a chart of'

sue

BUY

services to those desiring to
safest

Exchange

announced

Lucille

offer

the

Tomlinson

our

Tomlinson
of

world.

was

EXCHANGE
new

york

Telephone:

PLACE
n.

HAnover

131

EAST
NEW

office:

86TH

YORK

Telephone:

2-1340

STREET

28, N.

SAcramento

4.32%.

average

the

A Class of

average

Group Securities, Inc.

leading

Saint

Phalle

yield

be assumed that

com¬

"If it

can

stock

DISTRIBUTORS

earnings will be well

maintained

after

the

GROUP, Incorporated

war—and

63 wall st.

Broad

far

are

Saint Phalle to partnership in the
firm as of October 15.

2-5600

out

line

with

total

the

rise

charts

Experience

3 \f2%

yield

bonds

under

the

either

acts

principal

tions and dealers in the

or agent

issue

for institu"

same

asks,

wide?"

large blocks of both listed and unlisted securities.

This

contacts

tion of securities, in
to

and experience in

the distribu:

our

the

current

'spreads'
'

3.95% from high-grade, non-call¬
able preferred

stocks and

of 4.96% from the 50

facilities.

Bullock,

BOND

HAnover 2-2600

Street, New York 4

and
-

STOCK

BROKERS

Specializing in

4.7%* at the

end

stocks was

George Put¬
the

Putnam

Distributors Group—

....

Dividends
'

Keystone Custodian Funds, Inc.

dividend

common

Monthly Report, dated
September, 1944.

—On

country with that currently
existing in Great Britain.
"Moody's index of yields on 200

Established 1922

Custodian

161st

com¬

this

representative
30 Broad

The

yield

current

the

Series
of

"B-2"

cents

regular:

and

special dividend of $2.50 a share
out of realized profits for a total
of $3.25, and on the Series "S-3",
a
regular dividend of 35 cents a
share, both payable Oct. 14, 1944, ;
a

to shareholders of record

Institutional

A dividend of 50 cents
Aviation

of August.

Sept. 30.

Securities,

Group

Ltd.—

Shares,

This Nov.
30, 1944, to stock of record
is 190% of the average yield on
Oct. 31.
long-term taxable Governments, a
very
much higher than normal
ratio.
As
contrasted with
Mallory Interesting
this,
P. R. Mallory & Co., Inc., offers
yields on representative British
ordinary shares are currently on an interesting situation, according
the
average
only 114% of the to an analysis prepared by Steiner,
Rouse & Co., 25 Broad St., New
yield on 21/2% British consols. t
"If commoft stock yields bore
York City, members of the New
the'same relationship to taxable
York Stock Exchange.
Copies of:
Government * bond yields in this
this analysis may be had from
country
as
they
do
in Great
Britain, our average common stock Steiner, Rouse & Co. upon reyields would be about 2.83% in¬ quest.
stead of 4.7%, which would mean
a price level 66%
above the pres¬
ent level which would be equiva¬
lent to 240 for the Dow-Jones in¬

$59 Million in Dividends
week1 the Trustees

Last

Send f->r

Prospectus

of MIT

declared the 80th consecutive div¬
idend, since
in 1924.

Publishers

inception of that trust

This payment*

be made

Republic

which will

Oct. 20,1944, to share¬

holders of record Sept.

Investors

Fund, Inc.

29, brings
Distributing Agent

"Guide to Railroad Reorganization Securities"

W. R. BULL MANAGEMENT CO. Inc.
15

William

St.,

New York 5

Keystone

Special Interest Ir\ Defaulted and
When As and If Issued Railroad Securities

Custodian Funds
"'.5 V.

•

/ ;•

V "/

•••

' |

Certificates of Participation in

!'.

Trust Funds

•

investing their capital

PFLUGFELDER, BAMPT0N & RUST

•

follows:

% "
Series.
;
vV'L B-l, 2, 3 and 4 in Bonds
..

;

•

Securities Series
Hr ^
.

Members New

61 BROADWAY

Telephone—DIgby 4-4933

Prospectuses

Series

York Stock Exchange

K-l, 2 in Preferred Stocks
.

NEW YORK 6, N, Y.
Bell

Prospectus

Series

may

be obtained from

upon

request

•

National Securities &

S-l, 2, 3, 4 in Common Stocks
»

Teletype^-NY 1-310

payable

dustrials."

Railroad Securities and Reorganization Securities

News, dated Sept. 26 and Sept. 29,
Fidelity Fund—

in the

"What
.

leading

stocks in the Barron's index.

ilar point by comparing the spread
between stock and bond yields in

Co.

Keystone

respectively.

points out that on
yield from a group

the

series

single folder

Two issues of Railroad Equipment

too

■/.'

issue of the Bulletin, makes a sim¬

;

Fund?"

sponsor

Calvin

entitled,

highest grade corporate bonds
2.76% as against a yield of

mon

cAllen

was

block form, have proven valuable

those who have availed themselves of

"Are

Sept. 20

Our nationwide

Abbett,

of
Abstracts, applies
the
reasoning to preferred stocks

and

purchase and placement of

Fund—A descriptive booklet

nam

This firm

Corp.—A

printed

ing this period.

2.75%.".
Lord,

MIT

Funds for the years 1940 through
1944 and-also giving the amounts
of special distributions
paid dur¬

time

yielding

are

$59,000,000.

showing the market action of each

on the same yield
high-grade bonds in the

past, it would not be abnormal for
when

payments
over

Mutual Fund Literature

frequently sold

stocks

Keystone

price would be from 87 to 120—
38%. Inasmuch as stocks have
as

1924

basis

dividend

since

"If Barron's stock average were
to sell at a level to yield 3!;2% on

dividends,

new york 5, n. y

bond

yields.

present

Contacts and

Request

4,82%.

Exchange, will admit Jaqueline de

Prospectus

stocks the dividend

common

Weekly.

stocks

common

Barron's

yield

industrial

Co., there are cogent reasons for be¬
Street, New York City, lieving that this will be the case
members of the New York Stock —then it appears that stock yields
Andre

Members New York Curb Exchange

branch

Editor

Admits Partner

Members New York Stock Exchange

office:

Dow-Jones

Steel Shares

■

y'.v

y
dividend

"The

Executive

Associate

stocks.'

mon

Miss

mon

Ward, Gru ver & Co.
main

Barron's, the National Business

and Financial

Associate

election

Assistant. Before joining the staff
of the Association a year ago, Miss

purchase War, Bonds

investment

date and compares the current
yield of approximately 2.75% on
top-grade bonds with the dividend
yield available on seasoned com¬

Stires, Vice-President,
Scudder, Stevens & Clark Fund,
Inc.; and Paul Bartholet, Execu¬

BONDS

WAR

As members of the New York Stock

—the

Corpora¬

Ridge

——-

—

high-grade bond yields from 1875

tive Director of the Association, v
At the same time, Mr. Bartholet

Blue

President,

■■'■XV-y

investment company sponsors all pointing to the relative cheapness
of equities in relation to high-grade bonds at this time.

Hardwick

tion; George M. Gillies, Jr., Presi-

;

The Outlook

■

Research
120

;

LOS

Corporation

BROADWAY,
ANGELES,

BOSTON,

local investment dealer

NEW YORK,

634 S.

(5)

Spring St„ (14)

The Keystone Corp. of Boston
5© CONGRESS STREET,

BOSTON, MASS.

10 Post Office Square

(9)

CHICAGO, 208 So. La Salle St.

your

(4)

Volume

Commercial Banking After War
(Continued from page 1467)

against
after the

rates, assures the banker

depreciation

assets

•

capital.

estimation, bankers have less

for

over

worry

■:

reasonable returns

cause

war.

the future

than

half billion dollars for one-

owners

rent. The total

plated

projects

billion dollars.

residential building, including

to be built for
to order and by operative

valued

cerned, that you may hold your
securities at

know
that the bank examiner would not

;
.

for

comfort

small

it would be

that

however,

ing,

Conced¬

amortized cost value.

par

their
age

tion

own

ing construction, comprising pub¬
lic works and utilities, the Dodge

dicated for

corporation has a list of contem¬

and power

sewerage

dams

and

reservoirs,
electric light
facilities, and airports.

systems,

communities, and man¬

their businesses with imagina¬
and competence,
they can

face the

future with assurance.

you

if the

report your capital impaired

Government securi¬
ties declined to the point where
the market value of your assets
would be less than your liabilities,
I wish to mention two broad fac¬
tors which will work in the direction
of relatively
low interest
rates and stable value of Govern¬

value of your

Canadian Securities

Backlog Of Construction
Contracts Estimated

$10,000,600,000

The

backlog

projects

awaiting

of
construction
the relaxation

Government

the
and
V:
building materials exceeds 10y>
billion dollars, it was reported on
ment securities.
Sept. 29 by F. W. Dodge Corpora¬
One is that this country has be¬
tion, fact-finding organization for
come the greatest creditor country
the construction industry.
V in the world, and a creditor coun¬
The data were compiled after
try tends to- have a relatively low
special inquiry by Dodge's field
rate of interest.
A creditor posi¬
staff directed to more than 400,000
tion denotes a surplus of capital
persons representing city, county,
which is not consistent with high
of

State

;

interest rates.

and

manpower

Federal

Municipal
Industrial
Public

Utility

government

agencies,; private industry, -com¬
mercial, religious, social, educa¬
tional and other organizations, in¬
Naturally, I am speaking only for
dividual prospective home build¬
myself, trying to appraise the sit¬
ers, operative home builders, ar¬
uation as it appears from the re¬
chitects,
engineers,
contractors,;
search man's
desk.
Clearly, it
insurance companies, banks' and
would be good public policy to
other institutional mortgagees.
maintain moderately low interest
The compilation covers all States
rates and to support the Govern¬
east of the Rocky Mountains and
ment security market.
It would
pertains to projects reported up
not be sound policy to do other¬
to Aug. 31.
wise in view of the large invest¬
School
and
college buildings,
ment in securities on the part of
hospital buildings, manufacturing,
banks, insurance companies, pri¬ loft ; and
office
buildings
and
vate and public institutions, cor¬

Railroad

also is likely to be
maintain low rates.

Public policy

such

porations and individuals. Then,
too, there is the desirability of
keeping rates low in order to keep
down the cost of the debt. For rea¬
sons stated earlier I believe that
the market for Government se¬
curities will be strong

relatively
Government

rate

"terest

'.without

Should

tion.

and the inlow even
interven¬

become

••

the

order

listed

Wood, Gundy & Co.
Incorporated

—

Montreal

Toronto

principal non-residential
The back¬

Wall Street,

New York 5

Vancouver

Winnipeg

London, England

classifications reported.

log

of school-and college build¬

This announcement appears as a matter of record only
"

these securities for sale, or as

y yy
.

and is under no circumstances to be

offer to buy,

or as a

solicitation of

of such securities. The offering is made only by the Offering

construed as an offering of

offer to buy, any

Circular.

New Issues

Quest for Investment

The

are

act,

that the course
will be in the
.direction of maintaining relative¬
ly low rates and supporting the

"however, I believe
:of action pursued

market.

churches—r in

neces¬

sary for the Government to
•

controls

government

availability

greatest

the

Greyhound (Corporation

Outlets
banking

problem after the war will be how
outlets for funds, not how
vto meet a loss of deposits or a
deterioration of assets. In view of
.

•to find

$10,000,000

great liquidity of business en¬
terprises, it is going to- be difficult
the

3% Sinking Fund

The banker who
been restricting his. efforts to

find

has

loan

of the time and

most

"yes

search for

Price 1011/4% and accrued interest

will

unconventional outlets

investments.
have to be
given to small loans to individ¬
uals, to financing consumption,
and to real estate and other loans
that are not business financing in
"the old sense.
Whether business
requirements for outside financ¬
ing will furnish a sizable outlet
and

1,' 1959

only

have to widen,
to succeed in
the future.
If bankers are to do
a
livewire job they will have to
occasionally

Due October

Dated October 1, 1944

applicants

'his horizons if he is

•

Debentures

loans.

saying '"no"

fields for
attention will

new

50,000 Shares

•

4Vi% Cumulative Preferred Stock

•

for bank

Par Value $100 per

funds after reconversion

been

'has

accomplished

will

•With

Price $103.50

per

and accrued dividends from October 1, 1944

•large measure depend upon the
demand for peacetime products.

reasonably full employment,

be much above
and more funds
"would
flow
through, business
-'channels. This is but an example
?of the interaction of forces which
•will determine the fate of all sec¬
demand

would

'pre-war

levels

tions of the economy.
;*;

The value

ers

our

may be obtained within any state
"'from the Undersigned only by persons to whom the undersigned
■:may regularly distribute the Offering Circular in such state.

Copies of the Offering Circular

;

bank¬
beyond

of banks and
economy

question. They have contact with
-every phase of activity and perIform a

•

Kidder, Peabody & Co,

needed unifying function.

follow the principle of serving the public and
meeting the needs of their com¬
munities to the best of their abil¬
ity, I believe that the banking
business will continue to receive

long as they

October 3,

1944.

6.8

ways

visory authorities have agreed, so
far as bank examination is con¬
Government

Streets and high¬

represent the bulk of the
heavy engineering construction,
although substantial volume is in¬

apartment houses, dormitories and
hotels, was $1,032,066,000.
In the field of heavy engineer¬

family dwellings

1471

builders for sale

ings alone amounted to $767,930,000, and all non-residential build¬
ing to $2,676,373,000.
In the residential field, Dodge
reported a backlog of slightly less

If they
know, the bank super¬ than any other group.
analyze carefully their ■ functions
in the national economy and in

you

& FINANCIAL CHRONICLE

THE COMMERCIAL

Number 4322

160

Glore, Forgan & Co.

1472

Thursday, October 5, 1944

Year

made

so.

Inaugural Address, Mr. Burgess Suggests Three Ways Banks Can Help
(1) Helping End The War By Soliciting Purchases Of
War Bonds; (2) Helping The Returning Veteran Find What He Needs In
His Home And Community; And (3) Preventing Another War by Assist¬
ing In International Cooperation. Claims Bretton Woods Proposals

Service Men, Viz:

staff
it

made

so.

The hun-

r e

the

serve

Simplified And That Britain's Position Be Made "The Key
Of The Picture." Sees Dollar Stability Basic To Enduring Mone¬
tary Stability, And Says There Is No More Virtue In Makftig

As sociation

mittees

c om

devotedly

and

its

so.

200

Graduate

just in carrying through
daily
task
will
influence

Banking and the thousands of AIB

country's well being.

steadily, rais¬
ing the standards and the prin¬
ciples of banking are adding to
the. responsibility and the privil¬
ege of serving as president of the
who

are

Association.

than most of
well

who

have

source

past and

For

have only just

begun.

one

fair

sized

just

address

delivered

Mr.

his

Burgess

paper

inauguration

President of the American Bank¬
ers

Association at

the conclusion

of the 70th annual
cago.

111.,

.on

meeting in Chi¬
Sept. 27, 1944.

patience,

They are not
activities
but 'each
the
enthusiasm, the

report.

and

the

devotion

group of our members." These

tivities

not

are

only

ac¬

impressive

and
effective,
they
are
very
human.. They include a number of
new

activities

—

new

forms

"The

Chicago office pf the

hard,

unhappy-looking

gathered im¬

Association which may serve bet¬

men

7 the

kept to themselves. Along
boardwalk, in the Atlantic

7 City bars, they avoided civilians,
shunned

even

; other

who had not been

7 hard

young

soldiers
The

overseas.

men

veteran

were

75Army Air Force pilots and

crew-

7: men. They had had 21-day fur"7 loughs at home. Now they were
western area. I take personal sat¬
% at the Atlantic City redistribuisfaction in this move because this
tion center, being prepared for
was my home for many years.
;7reassignment.
• 7
7 7 7
*

look

theme

"Time" magazine: '7

new

year

forward, into
to

want

around

suggest

which

all

our

tivities may center—that will
spur

seem

hard

the

help

the.work may
little dull—a very

human theme.

77%7' v7 •<'•}•/

7 The theme I suggest is our duty
to the boys of the services, bank1
ing and G. I. Joe, under fire to¬

day—a veteran back in,
tomorrow.

;7-:'

our

midst

not

was

brooded

ac¬

when
or

7 7 "This

what

they

One of them said

over.

curtly: 'We don't need to be
oriented to the Army.

••

re-

A lot of

us are damn glad to be going
-back overseas. What they should

•"

have

for was the
coming home.'

prepared"

-•-shock of

"Said

•

been

7; 7'r'--: 7:'- Y-

bombardier who had

withjChennault's -heavy

bomber

in China for 21

group

months:'; 7;;;', V:;
"

'When I got

tan didn't
"

and

Their

hot spots and movies.

:T:'

of life hasn't really
damn bit. They are

way

changed

million miles

away

from the

sufferings of war.'

NOTICE OF IMMEDIATE PAYMENT

77%

Great Northern

Railway Company has irrevocably directed The First National
Bank of the City of New York to publish appropriate notices
calling for redemp¬
tion all of the bonds outstanding in the hands of the
public of the following issues:
Great Northern Railway Company
First and

%7%y

boardwalk,
in the Atlantic City bars, U. S,
;7 civilians were getting a look last
week at gulfs they will have to
"Along the

January 1, 1945, at 105% of principal amount

plus accrued interest

sunny

when

cross

the

boys

come

home,"7;:: <7-,'7".7'"':.a';7'
An

exaggerated statement per¬

haps, but it gives a tdvid picture
of a real gulf—one that has to be
bridged.

Refunding Mortgage 4%% Gold Bonds, due July 1, 1961
On

the

Banking

great national en¬

as a

that

terprise can help to bridge
gap. I suggest three ways.

J '777%

to said date

First,

77.

We all
things the banks can

re-absorb

Great .Northern Railway'.Company

General

.Y%7.Y%%%%%7

turn

experienced in

due

doing,

but

out¬

our

standing and special task is to sell

July 1, 1946

The Sixth War Loan

War Bonds.

January 1,1945, at 101% of principal amount ,; %:Y%%.:%J 7 "
plus accrued interest to said date
7-77; 777?''77777'

will be tough,

with Germany tot¬

tering

and

hope

Great Northern Railway Company
Collateral Trust
On

our

G. I.'s that

ordeals,

stayed

Company

Assumed

77;

Minnesota

Mortgage 4% Bonds, due April 1, 1948

bonds may

immediately obtain the full redemption price

Mortgage. 4% Convertible Bonds, Series G and Series H, will

continue to be convertible in accordance with their terms into Preferred
Stock of
Great Northern Railway Company until and

including said redemption date unless

paid prior thereto

above provided.

'
GREAT NORTHERN

RAILWAY

1944

have

seemed

complacent, have made

much

— rebellious
just because
they themselves have been de¬
prived so long of personal liberty

money

and

the

own

y7 77' V%%7"''77'

There

for

cure

live their

chance to

lives. ;

general

no.

this

overall

problem.

great

can't be met just by. a bonus, or a

system

employment

agencies.

It must be met; by human under¬

standing and immediate practical
help. Each
veteran
must
find
he

what

banks

own

home

community.
help'.
'" ? ; : :

The

own

can

Fortunate

who

before

their

military

back

settle

can

with work

those

are

experience
life

his

needs in

his

into

familiar routine and environment.

Old employees who return to our
banks will not be hard to

though

must

absorb,
they

recognize

different people and will need

are

understanding and
their

work

and

adaptation

their

restlessness

their

greater maturity.
They will need wise counsel and
chances

talk

frankly, for they

have been dreaming dreams, and
we shall find if we think about it
that the office they come back to
is changed from the one they left.
Above all, we shall need friendli¬

and patience-Mwo very use¬

ness

ful

qualities at

But besides
us

time.

any

people re¬
there will be among
our

own

returning veterans looking for
some destined for
leadership
men tempered in

work

—fine men, able
the furnace of

ing

war.

miss¬

are

great opportunity if we don't
reach out. for some of these peo¬
a

ple,

even

at the cost of temporarily
To interest them

surplus staffs.

shall have to offer them

than jobs—we shall have to show
them

vision of opportunity in a

better banking system to

economy

the result?

Would

But

larger.

of mind
The danger of in¬
peace

our

serious, but

perhacs more important still, 80,000,000 bond holders are a great

With 80,000,000 bond
the demagogue will be

protection
holders

pronose

wreck

the

value

There

will

slower

of these

many

for sound money.
so

measures

that

bonds.
votes

Also these bonds

widely held will be a national

for the- rainy day.

only one real way to
sell bonds and that is by individ¬
ual

solicitation.

whole made

this way—by
tomers.

It is

The banks as a

great record in just

soliciting their cus¬
time for each bank

their country in peace; This
take thought, planning and

serve

will

imagination,
success

well nights when we
thought of the goodness of our
assets?
Our
income
might 7 be
as

There

By F. J. GAVIN, President

makes
for us

all—in¬
cluding our veterans; when they
come back.
Suppose all the bonds
were held
by the banks —- what
healthy

reserve

COMPANY

St. Paul, Minnesota

October

ner^

may

new,

people

would be less.

thereof, including accrued interest to the specified redemption dates, by surrender¬
ing such bonds with all unmatured appurtenant coupons to The First National Bank
of the City of New York at its office No. 2 Wall
Street, New York 15, N. Y
The above General

A debt well distributed among

flation would be

Holders of the above

will

Many-

the

sleep

Great Northern Railway Company

April I, 1945, at 105% of principal amount
plus accrued interest to said date

still behind

and

because those who

—

all

would

Northern Division First

are

occupations.

been through ter¬

home

ways,

battle, quite in-

vously unstable.
belligerent

some

son:

January 1, 1945, at 104% of principal amount
plus accrued interest to said date
' 7

Eastern Railw

to show

a success

There is another basic rea¬

them.

4% Bonds,Hue Serially to January 1, J952

and

fallen,

people's minds turning to peace.
We must make it

peace

Many will have
rible

know many
are

life

others—experienced

in the tension of

the

and

civilian

Butd'hey will' not

men, mature

immature

turning to

Mortgage 4% Convertible Bonds, Series G and Series II

of the whole work¬

be people with new personalities.
Many left as school boys and re¬

helping to finish the war.

%%%7;^

Many will

now.

Eleven million veter^

soon.

them¬

Some of them

be just so many people
looking for
work.
They will, in many cases,

must give our best in

our

done

direct obli¬

our

servicemen

ing population.

;'7'7

people jamming the

saw

bars

real.

seem

have

people;
coming home

and

home Manhat-

done

have

';77\7:'

Second,

come

recent issue of

they

boys

T commend these to you. Let's
go
all the way,;• 7777,, V.

are

partly suggested

was

have

our

ury
War Borrowing will again
suggest procedures which they be¬
lieve will bring the best results,

ans

article in

All

when

Only'the best will be good
enough. Your committee on Treas¬

selves

ter the interests of the great mid-

new

only be mentioned in

the

and

ties for business and agriculture I
have pleasure in announcing the

the Association. They are so many
can

pressive impetus. They justify our
wholehearted support. As a'logical
outgrowth of the growth in activi^

opening of

My theme

In this year the es¬

activities

ventures alike have

they

represents
*

I take it

Lee Wiggins has reported to you
briefly on the year's activities of

responsibility to

to the future.

the

try and bad banking wounds the
a vital spot.
;7V i

in tribute to those
made it so, and thus

otir own

evil

root

of national good.

the

money

country at

organization

realize and

For

our

as an axiom that sound, progres¬
sive banking is good for the coun¬

pause

measure

the

better

the

can

We have

tablished

School

to help banks, large and
small, country and city, do their

work better.

communi¬

our

ties at almost every point.
At a
critical time what we do or fail to

from

forth
The

year

service

the economic life of

who

men

would dare say that banks

today fill the place in the national
life which they might.
We touch

The 150 to

each

Burgess

made

have

well

will be 20%

activities

home if

gation

Bad International Loans Than Bad Domestic Loans.

forward

carry

its record.

better

theirs.

•

Should Be

who

\feel

come

In His

and

able

his

have

examine

will

job

Harold

Stonier

graduates

to
:

Yice-Chairman of the Board of the National City Bank of New York

his
distinguished
predecessors

Newly Elected President American Bankers Association

Lee Wiggins and

have

Servie

By W. RANDOLPH BURGESS*

it is becoming a

year

greater honor to be elected to high
office in the American Bankers
Association.

Duties

but

the

Servicemen will

come

Some

customers.

reward

will be great.
to

recent

also
sur¬

show that

veys

many of them plan
into business for themselves.

to go

will come to us for funds,
perhaps for the $4,000 of the G. I.

Some

Bill under which the Government
will

guarantee 50%.

sions of the bill
and

are

The provi¬

far from clear

interpreting regulations have

not yet been issued.

ready to

Bankers

make loans

are

service¬

men as fully as is
reasonably poss'ble and desirable. It is, of course,

no
a

kindness to start

man

off

venture doomed to failure which

will

only leave him in debt.

fortunately

Un¬

large proportion of
this type of business venture ends

failure.

have

Each

some

one

bank

reeds

prepared

sit

down with the would-be borrower

review

his

case

carefully and

Volume

We need to be

advise him wisely.

explain the rules for suc¬
cess
in starting a business.
The
machinery of the banks for loans
to small business and for personal
able to

loans will prove

useful in meeting

has

broader com¬

responsibility.: Let's

munity

that the banks

sure

"part

do their full

the men

that when

see

home they w.ll find their

.come
home

receive

ready

towns

them the honor they
deserve, to answer their questions,
them, to give

help them fit back into civilian

life.

have

To make sure that all of us

information and un¬

the necessary

derstanding of this problem, I pro¬
to appoint a new committee

pose

Associa-

the^ American Bankers

tion which we may call the Comon Veterans or, if you wish,

'.mittee

study of these plans.
It is desir¬
able that there should be full and

ment

take

individual
this subject now.
It

after

World

frank

expressions

opinion on

concerned.

made

foreign

other

lapse.

Bankers Association to express an

these
plans not only allows opportunity

opinion on

that

until

important a subject
can represent

but

substantial

may

that

the

zation and for

be able to suggest
simplification; of the
Bretton Woods proposals or al¬
ternative
constructive
proposals
which will make sure that funds

study

will

which

may

recovery are

used.

provide for world

bad

wisely and prudently
no more virtue in

international

stability

"With

malice

ness

see

job, but

care

lar which

borne

putting

only

can

come

from our

for

him

order.

which may

G. I. Joe, as soldier
lies clear before

Our duty to

ready for the veterans.
is still a third responsi¬

ourselves

bility to G. I. Joe and to

and I, as citizens, will be
thinking about in
the months
ahead—the setting up of means to
that you

Whatever You Need in

Banking

prevent World War III.
Unless
we do something it is due to come

if not
fin¬

in 20 to 25 years from now,

We thought we had

sooner.

World

ished the job when we won

We tried to

War

Somehow

Pacts.

peace

wage

Kellogg
didn't find

and

disarmament

with

right answer or take it quite
seriously enough.
Two things seem to be essen¬
tial: (1) Setting up of machinery

•the

by which nations confer together
and act together when necesary.

thirty-two

of experience in domestic

years

hanking—through 6 major wars—along with experience

unflagging

(2) The continued and

hundred and

Gov¬
and bv citizens over long

attention to this problem by

periods.

responsibility as bankers is
to give particular study to
the
economic and financial aspect of

operating branches abroad for 30 years, equip National City

ernment

help American banking and industry in planning post-war

Our

reconversion and
National City

international relations and report

public how proposals in this

to the

leader in

likely to affect our coun-

are

area
'

Vi'.'*

try;

definite proposals re¬

certain

sulting from the conference

Woods

Bretton

nations

gress

banks
manv

Con¬

agreement action by our

until

postponed

election.

after

overseas

field;

individuals*and little businesses;

adapting hanking to changing conditions. '

long background of practical banking knowledge,

with correspondent

throughout the world, National City today is serving
of the country's largest

industries

well

hundreds of

thousands of individuals and small businesses...

these proposals is being

first to enter the

plus the advantages of close association

of 44
this

By general and fortu¬

summer.

nate

the

offering small loans to

With its

the pub¬

There are now -before
lic

and in

expansion here and abroad.
was

addition, all National City branches offer the

gives time for the full con¬

This

de¬

sideration which the proposals

require,

and

serve

chartered in 1822. It conducts
the

Commission
a

international

creation of an international body

nations

Head Office
>:

;'cvx $}V

*'-A''.-"F

'"'S;

OF NEW YORK

STREET

WALL
A '-A

;

•

New York

•

VxV-J.iKv1". :'v •'

FARMERS

Head Office
Uptown Office: Madison Avenue at
Information

may

likely to be sound and

are

•

'»!•'.*

Y\ h;

BANK

CITY

monetary

modest amounts of credits where

they

of the property of its clients.

«*>'

■'

'.A:

•" •

TRUST

COMPANY

conferring

problems and for the extension of

posals go far beyond the sugges¬

•

22 WILLIAM

STREET

any

■AT;

Corporation

.1
.
■ :,:;- v
'-f'
Active Overseas Branches of The National

.y.'':-■:b';V-

tions of the Economic Policy Com¬

New York

branch of The National City Bank of New York

Members Federal Deposit Insurance

■

•

Brooklyn Office: 181 Montague Street

42nd Street

also be obtained through

The Bretton Woods pro¬

fruitful.

business—

the

finance

for the twin function of

the

a trust

CITY BANK

NATIONAL

THE

other

among

proposals to encourage trade and

among

only

Association

this

study favored

sound

and management

report on the whole

The Commission after

problem.

care

the Economic Policy

A year ago

published

City Bank Farmers Trust Company—

un¬

/''A A;

derstand.

long

they are

for

and difficult to

complicated

services of the

-'y

;

c/A--Af-:-::.,■••■ T A A T A -AT /

City Bank of New York

mission.

They

call

would

commit¬

for

ment

by the United States of as

much

are

$6,000,000,000.

The plans

elaborate and complex.

It is

ARGENTINA

Buenos Aires

Flores

Pernambuco

clear,

Monetary
loans

are

the

(Buenos Aires)
CANAL

ZONE

must

good

international

find

means

cooperation.

therefore

asked

the

(Buenos Aires')

Cristobal

for inter¬

have

Association's

BRAZIL

Santiago
Janeiro

Valparaiso

Caguas
Mayaguez

Matanzas

Santiago

CUBA

-■

City

Ponce

REPUBLIC

PERU

11, Waterloo Place

(Havana)
Lonja

(Havana)

Panama

London

117, Old Broad St.
;

PANAMA

ENGLAND

Cuatro Caminos

Mexico

Lima

Havana

Galiano
CHILE

Rio de
na¬

Barranquilla

Manzanillo

(Havana)

Rosario

arising

time when the

national

Balboa

They are.

proposals

important

conference at
tions

only

contemplated.

however,
from

that

the

particularly
Fund,

MEXICO

Cardenas

Mcdellin

Sao Paulo

Plaza Once
not

Caibarien

COLOMBIA

Bogota

Santos

INDIA

Bombay

URUGUAY

PUERTO

RICO

Montevideo
San

Juan

Arecibo

Bayamon

orphan, to do all

just and lasting peace among

There

■

shall have
for his

and

ourselves and with all

veteran,

in, to

achieve ana cherish

to make sure now that
are

we are

who

battle

the

widow and his

financial house in

our own

work

all, I know, want
the banks

none,

nation's wounds, to

bind up the

tually, I hope, will work itself out
of

towards

the right, let us strive on

to finish the

other committees and even¬

with

in the words

all, with firm¬
in the right as God gives us

stability of the United States dol¬

and

not

of Abraham Lincoln in his Second

monetary stability
to the strength and

is assurance as

countries

the

than

defined

build

must
could

Inaugural Address:

necessity for any en¬

world

during

political and eco¬

nomic

ahead

with charity for

basic

other

with respect to secur¬

and the internal,

Both

required from this country
making
other
commit¬

It should also be added that an¬

advance

ity, reciprocal trade arrangements

loans

loans.

domestic

task

better

before

currency

economic

the program

plans to prevent World War III.

understanding.

nelp is

of an inter¬
program and
we
are
handicapped in judging
them before we know the rest of

national

this

ments.

came

interna¬

other necessary parts

There is

making
than

loans

means

off her substance in

plan for Britain. We ought
know that, and to know what
is

stabili¬
longer term foreign

mechanisms for

further

his needs both for jobs and human

A first step in world recov¬

war.

These proposals for

tional picture.

American

the

elements

the veteran home and meet

come

Our

ery

effort,

war

special responsi¬
bility as bankers is the Sixth War
Loan.
We must prepare to wel¬
our

the
has

drained

require
gives time for development of

number of the members.

Bankers Assoc.' a tion after

action

delay

for the careful study they

opinion

the informed view of a

The

this

Unlike most of
countries, Britain

depended.

by col¬

followed

and

which many parts of the world

They led to

War I.

over-expansion

tion.

We must finish the

us.

center of world trade and finance

loans

•

In particular the key

picture is the British posi¬
For Britain has been a great

to the

Govern¬
private channels, the mis¬

repeat, whether through

thorough

We do not wish to

make trouble.

Special

make

It will work

the G. I. Committee.

Activities

would be unwise for the American

this situation.
Each of

Committee

Advisory

1473

FINANCIAL CHRONICLE

THE COMMERCIAL &

Number 4322

160

VENEZUELA

Caracas

nations."

"THE COMMERCIAL & FINANCIAL CHRONICLE

1474

Thursday, October 5, 1944;

Some ©isejvationr CM^ Coxmiiercial And Savings Banking In England
By W

The banking business in England
is

old

dating back to the

one

goldsmiths
century.

in
the
seventeenth
Today the commercial

Bank Executive Describes

•

b a n k i n g is
concentrated

ten

Of The Government

the

And The

House

ing

great

England As A Central Bank and Fiscal Agency

part

aged saving profits for
sake, but urged people

Widespread Operations Of The British Postal Savings Banks
Self-Denial

Produced

of the nation's

Self-Coritrol

and

banks

done. The Big
;

Five,

as
c a

are

that

"five
b

a n

of the

they

l l

fices in London .and as one walks

Among. The People.

establishments are
ample proof that here was the
banking center of the world. The
heavy drain of two wars on the

Midland, Bar¬
W.

National

name

tion

with their thousands
branches largely determine the

publicly ownOd, is the central bank
and works in close cooperation
with the Treasury in determining
the country's fiscal policies.
It
used to conduct a general banking
business, but of late years it has
not been taking new accounts, its
purpose being to gradually reduce
its

individual

and

accounts

con¬

its

operations to serving as
depository for the Government
and the banks, and acting as fis¬
cal agent for the Treasury.
There are also a number of pri¬
vate banking houses, called mer¬
chant
bankers,
which
conduct
specialized banking functions such
.

were

familiar

other

J. P. Morgan & Company,
Brown Bros., etc.
Many of them
days

have

names

world-wide

the

which

Government

of the United

lege

development
States, industrially
and financially, may result in that
center shifting to New York.
If

re¬

of bankers to the world.

Success

achieved unless Gov¬

will not be

funds

investing

with

the

Commissioners at
than

4V2%.

their

surplus

National
a

Debt

rate of better

This

proved so» at¬
.500 banks
were organized the next year, each
under
the
management
of its
tractive that. more, than

Board of Trustees.

As time went

the

Baring

policies

Washington

Chicago,

111.,

1944.

25,

Sept.

on
' \

opened

child

will

under

the,

viously be

subject to with¬
by the child on reaching
age of seven.
Funds of al¬

the

uerived from business
are

for

peace

re¬

ing

In 1807 Samuel

of this.

came

Whitbread

presented to Parlia¬
plan for a savings bank
under the management of

ment
to

the Post

failed.
of

Office, but this plan also
The

Ruthwell

Savings

Rev. Henry
is

called

Banks

Duncan

the

Father

because

1861.

The

use

of these banks has!

steadily increased until there are
now 18,500 of them, an increase of

1,000 since the beginning of the
war.
During the war and be¬
cause of it the total deposits have
increased from 536 million pounds
to

one

billion

four

hundred

ten

secured the establishment of

ings banks there in 1810.

sav¬

million pounds and the number

A curi¬

the depositor was the payment to

..a

prospective

bridegroom

the types

of accounts that

permitted.

Any individual

are

over

est for

operations.

social, religious, and similar
societies. There is no limit of de-;

ment of similar

Its

other

services

trustee

banks,

there

are
now
723 of them and
their depositors number in excess
of five million. The deposits have

Like the Post Office

are author¬
ized to issue Government securi¬
ties and they have been of great

the

Government

Now

ward

rates

These banks

by the

the extent of

When you wish

and

virtually

place

arms

victory,
but
firing and
again selfish interests
to

guns

cease

too

show those qualities of

find the
largest measure of common un¬
derstanding possible. Together in
peace we can do great good for
ourselves

and

the

en¬

world

great English speaking nations fall

apart
dark

the
and

future

will indeed

foreboding.

■

about Tennessee, you are invited

Stocks

answer

Bonds

Co.

Commodities

Direct contacts

concrete questions promptly—

Underwriters, Distributors, Dealers in
CORPORATE AND MUNICIPAL SECURITIES

Company, Common and Preferred

TTEflIIt0» NATIONAL BANK

MEMBERS
New

Nashville, Tennessee

York

Stock

New York Cocoa

Member Federal

Deposit Insurance Corporation

Exchange

Chicago Board of Trade
New York Coffee

Exchange

& Sugar

•

New York Curb Exchange
New York Produce Exchange

■'

Exchange

New York Cotton Exchange

*yNew Orleans Cotton Exchange

ONE WALL STREET
Tel. BOWling Green 9-6000

Wilmington, Del,
White

Plains, N. Y.

have done in war, but if the two

empowering the Na¬

line of Tennessee business and industry

position to

accurately.

going for¬

Then will be the time for

selves.

tional Debt Commissioners to ad¬

Christiana Securities

•

are

plant location.

to'know

every

brothers
we

industrialists to consider

to check in with Third National of Nashville.
with

and

been

the

Francis I. duPont
more

Tennessee for post-war

have

are

self-control and to try to

in¬

Government

necessary

in both countries will assert them¬

fixed

couraged

peace comes

The rate of interest paid
regular accounts is 2Vz%, but
there is a Special Investment De¬
partment where money is received

together

when

of encouragement to

terms

with them and

savers.

special

for

the admiration of the world.

Savings Banks, they

half

to go
abroad for proof of this we need
only to go to Britain.
There the
people are thrifty and they haye
shown an amazing degree of cool
courage and self-discipline during
the past five years that has won

They are strictly supervised
by Government, arid annual re¬
ports are submitted to Parliament
by the Savings Bank Inspection

program

feel

day.

its

and

securities

of self-denial and self-control.

increased from 277 million pounds
in 1938 to 567 million pounds to¬

assistance

now

general corporate purposes.
We have been told, and I think
most of us believe, that the prac¬
tice of thrift develops character
because it requires some degree

times.

Committee.

banks elsewhere.

which it pays 2%,
sixty million pounds. It's
funds ,are invested about half in

peace

To return to the trustee

depositsj

are

per^

form

ers.

prompt

Chamberlain, and after the
war, its
authority was ' extended.
five hundred pounds that may
be; The management is composed of
deposited in a year.'
' the Lord Mayor and certain mem¬
These banks also sell Govern¬ bers of the City Council. The bank
ment
stock
to
their
depositors enjoys an excellent reputation in
which has increased since the out¬ Birmingham, but the Government
break of the war from 176 million has not encouraged the establish¬

of the National Debt Commission¬

reasons

a war measure

Neville

by the trustees of
each bank subject to the approval

World War I

posits that may be carried by one
depositor, but there is a limit of

terest

Good

time after the war."

unique savings bank
England. The Birmingham Mu¬
nicipal Bank was founded during

with

About Tennessee

some

There is

Ask Third National

retrench¬

of national re¬
The Chancel¬

construction, etc.
of the Exchequer and others
have
emphasized
that
savings
must go on in the national inter¬

accounts carried

many

furnish

lor

most any organization can be de¬
posited provided the money is not

There

savri

labor

need for

ment for purposes

seven

tion,

may

which

own

turns, the appeal must again Be¬
come
largely a personal appeal.
On the other hand, there will ob¬

trust accounts. An

deposits grew so that a
limit was placed on the amount
are conducive.
that could be deposited by one
I have mentioned these kinds of
banks to give you a background person and the rate of interest the
for the savings banks, whose story Government
paid was reduced.
I now will outline briefly to you. The
experience of the trustee pounds to 867 million, the increase
Daniel Defoe, the author of Rob¬ banks prompted Mr.
Gladstone, representing the sale of defense5
inson Crusoe, is credited with the then Chancellor of the Exchequer,
bonds, which are issued only by
first
plan for a savings bank, to propose the Post Office Savings the Post Office.
The Post Office
which he conceived in 1689. Noth¬ Bank Bill, which became law in Banks also sell annuities and
ernment

of
depositors from 11,500,000 to 18,Bros., Morgan, Grenfel & Com¬ ous; feature of this bank was. that- 250,000, so *that now it is safe to
assume that every British house¬
pany, and others.
Many of the its depositors had to furnish satis¬
factory evidence as to their moral hold supplies at least one deposi¬
character and fines were imposed tor—"Any individual, even a child
*
An address by Mr. Hemingway
if deposits fell below 4s annually. under seven, may have an ac¬
before the Savings Division of the
Another novel provision for the count."
Second War1 Service meeting of
I think you may be interested
improvement of society as well as
the American Bankers Associanown—Rothschild & Sons,

part, to joint
account

started.

were

few years

then by an act of Parliament of¬
fered to the new banks the privi¬

banking policies and practices Of
so, there will go with it a great
the country.
responsibility and it will be no
The Bank of
England, while
easy task to discharge the duties

fine

materials and
purposes.
When

war

drawal

others

British and the rapid

L. Hemingway

Provincial,
of

By 1817 the number had grown
sufficiently to attract the atten¬

ferent banking

viz.,

clays, Lloyds,
Westminster,
and

spread around and in

its

the sake of the nation, to

higher rate of interest than was seven years of age may open an
generally paid. As might be ex-, account and may have more than,
pected,. the story pf this bank soon one: account and may also be a

through the streets of the finan¬
cial district the names of the dif¬

is,
the
largest

k s,.

operating in distant parts
empire have their head of¬

a
purpose.
With the coming
of war, the appeal swung over to
the vital necessity of saving for

money,

was

for

Development Of Thrift In England Has

business

war

individual appeal—wise saving for
wise spending. We never encour¬

He Traces The Development Of Savings Banking

And Points Out How The

^ through whom
a

founding new
Viscount

movement before the

London Clear¬

for

money

Simon, for many years director of
savings of the Post Office, had the
following to say about small sav¬
ings: "The. appeal of the savings

Briefly The Banking System Of England, Showing

Position Of The Bank Of

mem¬

bers

vance

Trustee Savings Banks.

Bank & Trust Co., St. Louis, Mo.

The Concentration Of Commercial Banking In "The Big Five," And The

There

hanks.
are

few large

L. HEMINGWAY*

President, Mercantile-Commerce

NEW YORK
Cable; RHetpont

Newark,

5, N.'Y.

Teletype: NY 1-1181

Philadelphia, Pa.
Charleston, S. C.

be
s

Volume

THE COMMERCIAL & FINANCIAL CHRONICLE

Number 4322

160

1475

and

Spending Or Saving Our Way
(Continued from page 1459)
and in

planning wisely for them¬
selves to promote sound business
and financial policy and the broad

public welfare.
The
responsibilities
banking fraternity for

of
the
sound,

saving arduous.
They are
stronger also because for a decade

To Post-War Prosperity

economy are by background and paved the way for more and more
more
experience far removed from the government: financing in
processes
by
which
wealth is and more directions and placed a
created, and by which only it can heavy burden on sound recovery
be created, and are thus ', easily within the framework of private
•
> •
•
•
persuaded of the alleged advan¬ capitalism.
Thus
the
question
shall we
tage of spending over saving and
of the high desirability of man¬ spend or save involves an issue
f

or
more
the
government
has
largely been under the influence

tween

private enterprise and some
collectivism, between sav¬
ing and investing by individuals
and corporations, and dependence
on the public credit over an everbroadening sector of the econ¬

omy." ::

prudence

can

winds

about

a school of economic
philoso¬
phers who would like to believe

form of

That

■

forces

the

favorable

„

to this group
'

of men and women

decade ago and

the

result

accelerated as a

war

sharply

run

against the grain of modern cap¬
italism

and

enter¬

business

free

better name

the American way
;

call

of life.

lation

which

directing

due

also

mistaken
and

wholly

view of the relation of saving
of

"THE

capital to production, and par¬

ticularly to employment and jobs,
in which currently there is the

■the trend,

already marked, away
from individual thrift, the trend
from

capital creation,
philoso¬

new

all trends based upon the

OF THE

have

invested

never

earn

others

Having been born on a western
Ohio farm, I learned early in life
and by the sweat, of my own face
the
Of

were.

land

real

of wealth

sources

the

place of labor and
production of food I

the

needed

instruction in my

little

college course in economics.

first

My concept of capital was vague,
I
knew full well that the

but

had

who

farmer

give useful employ¬

which

used

and

saved

for

selfish

^ ?!i;; .'^j

Cash and Due from Banks

invested,

advantage.

U. S. Government

is unmistakable that
high-minded altruistic men and

implication

do not

women

Much

this

fully guaranteed

and invest.

save

philosophy

has

State and

decade.

pf horse power was the farmer

ders.

and made money,

Deal blun¬

vague

moved

from

the

suffered

and more of us
land and lost

first-hand knowledge

wealth

of the proc¬
It is

creation.

109,634,995.15

•

129,265,455.66

913,836,757.48

pressure

the

maintained

•

Acceptance Liability

9,346,561.26

•

6,575,211.47

•

8,000,775.20

•

7,050,000.00

•

*•••«•

Other Real Estate

behind the constant

lie

♦

Other Assets

the

4,417,943.17
1,984,698.79

»•*••»••••

money r mar- •

i,675,383,813.87

By depressing constaritly the

ket.

rate

LIABILITIES

^Capital Funds:
Capital Stock.

•

124,000,000.00

48,613,239.21

•

I Undivided Profits

'
SPECIALISTS

Reserve for

Contingencies

Reserve for

United States Government

Taxes, Interest, etc.

Deposits.

Securities

IN—

{

$111,000,000.00

Surplus.

283,613,239.21

10,836,059.52

»•«•••

•

9,566,062.98

...........

4,352,959,552.52

•

Acceptances Outstanding $ 10,007,718.69
i

Less Amount in Portfolio
i

35,060,082.16

administration -has

interest, which after alT;
significant in this connection, I is the premium paid for saving,
think,-that a majority of those the government has discouraged
has
impeded long-term
who today would propose to spend thrift,
our
way
to a sound post-war private Investment and has thus
of

esses

•

Banking Houses

sound economic thinking

•

Stock of Federal Reserve Bank*

heavily

•

Customers'

seems

•

Mortgages

kind of way I asso¬ tax measure was precisely the
equipment with same as that of the. answer just .
thrift, with savings and generally referred to: Savings are selfish
with a method of living which and make for business stagnation;
among many of us today is con¬ spending is high-minded since it.
gives
employment and : ; creates
spicuous only by its absence.'
f
My purpose in relating this bit great business and commercial ac- ;;
of. personal history is to record tivity. •
*>,• 1
• v
'i
'
the
same ^ philosophy,
the
opinion • that -the cause of '».{ Much
and in

2,601,379,080.21

•

Accrued Interest Receivable

The thesis underlying that

ciated good farm

••••«••

Take, for example,

of all New

the worst

who lived well

•

Other Securities

undistributed corporate

Obligations, direct and
•

Loans, Discounts and Bankers' Acceptances

running through government
policy and legislation for more

than

848,832,253.32

Municipal Securities

been

the tax

The

buildings profits which,, in a really stiff
and plenty competition, stands out as perhaps

ment."

good

and farm implements

•

CITY OF NEW YORK

RESOURCES

1,843,715.80

8,164,002.89

Guaranteed Issues

•

;

•

'• ••

:•

•'

•••■

••

■

Liability

v»

Federal Land Bank and Other Agency Issues

/'v

:- v

■

Territorial Bonds

Municipal Bonds

and

Endorser

Foreign Bills

Other Liabilities

on
.

Acceptances
.

•

48 Wall

Chicago

•

Boston

Philadelphia

•

Cincinnati

•

St. Louis

•
•

Pittsburgh

to secure

$4,675,383,813.87

at $830,458,265.00 are
pledged
Deposits of $659,718,998.41 and other public
deposits, and for other purposes as required or permitted by law.

U. S. Government War Loan
trust

Cleveland
Membqr Federal Deposit Insurance Corporation

San Francisco

Direct Wires to all Offices

■fr

28,422.62
10,216,474.13

funds and
.

•

United States Government and other securities carried

CO.

Street, New York 5, N, Y.

>•

:: ;.V

C. J. DEVINE

the
of

is largely because we have
(Continued on page 1479)

CHASE

that

what

phase

public housekeeping.

our

STATEMENT OF CONDITION, SEPTEMBER 30, 1944

•

every

any

because I feel that what I
should
be
spent to 1 help

money

hold

thrown

dies Home Journal":

The inference is perfectly clear.
the last decade which
spending, rather than Money which is spent helps others
and gives employment, while that
saving, makes the mare go.

phies

NATIONAL BANK

;

amazing answer ■ to a question
recently appeared on her
"If You Ask Me" page in the "La¬

major portion of my remarks is

away

executive order and that

■

which

The first of these trends and the

one

of economics

acceptance of the philoso¬

Wide

They run likewise against
banking of the kind in which a widest public interest.
A ; nationally *• known
'large majority of those in this
woman
room are engaged.
In fact, they whose column "My Day" is famil¬
cut sharply across all of what for iar, to most of you published this
prise.

the lack of

laws

initiated phy of spending in recent years is

and financing

spending
a

else.

that certain trends in the field of

basic

longer
operative,
that
prices can be controlled by legis¬

and solvent America are
which this
nation must
decade spending are currently stronger
very great.
They have not, I sus- agement and manipulation over
very soon'after the war is over. than those of saving there can be
ject, been as great before. Sound industry and production. > • '•
It is obviously more pleasant to Involved directly in the answer no reasonable doubt. ' They are
banking leadership, or the lack
to .this question is the choice be- stronger because spending is easy
of it, may very well be the most wish for the abundant life than to
important single factor in deter-' provide it by dint or one's own
ming the kind of America we effort." And it is easier to spend
It seems
shall have in the decade and the money than to save it.
to be particularly easy to spend
generation ahead.
It is superfluous for me to say money that belongs to some one
sane,

the

that
are

1476

THE COMMERCIAL & FINANCIAL CHRONICLE

There

has

probably

punitive legislation

been less
Federal or

—

other
of

trust-

all

the

such

that

can

be 'made,

for

Trust Division's Recommendation For

it .'indicates

that,
whole,.

the
trust

.....

business

has

ably and

and

con¬

Henry A.

Theis

While the

by
the

the

Executive

Trust

Division

by the Executive Council of

April

1933.Mt

incorpo¬

was

rated in the Bankers' Code of Fair

still

was

suffering from

competition under-NRA as Sched¬
ule
"A", effective October 16,
economic crash,
and before the 1933.
When-Regulation F, gov¬
mania for
solving all our eco¬ erning the - conduct -of- trust de¬
nomic ills by legislation began,
partments of national banks, was
trust business set about to declare
adopted by the Board of Gov¬
itself and the standards by which
ernors
of
the
Federal
Reserve
the

shock

the

world-wide

the business should be conducted.
How

sound

be carried

trust

should

business

was

in the minds of

trustmen, but had never been put
down

In the

of 1931, trustmen

work
in

the

draft

this

1932

sub¬

Statement

Trust

Statement

bring

fall

assigned' to

was

Principles
Thfe

and

Institutions.-

its

final

form

consideration for

argued by

■

?An

fore

address
the

Meeting
ers

by Mr. Theis be¬

Second

the

War

Service

American

Bank¬

Association, .Chicago, 111.,

Sept. 25, 1944.

surcharged because its standard
performance did not measure
up to that of the Statement.
J

was

under

institutions' in the
standard
not

per¬

measure

jup

so high a standard as that pre¬
scribed^, by tthe .Statement .of Prin¬

the

given
the

pre¬

the

Statement may i be
why the trust busi¬
ness
was
left substantially alone
in the flood of reform legislation.
So, it may be said that here is a
one

reason

business

which

regulated
the

has

itself.

conduct

proper

business must of

successfully

Due

course

credit
the
be

for

trust

given,

ficiaries
was

Statement might

the

injury of such
institutions, and that, there¬
fore,
no
rstatement * should, be
adopted. These views did not pre¬
vail' and,.;so far -as?'I know,-no
trust
institution hak fever .been
trust

ification
this

the

.The. Trust

spring from
states.-.

clar¬

amelioration

situation.

The

within

the

must

cure

separate

....

.The Trust Division is cooperat¬

ing with the National Conference
of:

Commissioners

Uniform

State Laws in drafting a "Uniform

Reciprocal

National

<«.

other

activities

trust

ex¬

departments.

ture

under the

Chairmanship of Greg¬

Page, turned what might have
punitive legislation into con¬

ory

been

structive
means

legislation; not by any
perfect, but workable. ; '
tax laws, punitive legis¬
aimed at the customers

our

lation

was

of trust

institutions and at bene¬

the

mis¬

few

trust

which
aggressively
pushed their trust business on the
basis of tax avoidance.

These in¬

stitutions

the

subordinated

instrument

trust

the vehicle that it is

for

accomplishing laudable social
aims, and sold trust business pri¬
marily

as a

reaction

Act

on
as

Out-of-State

Fiduciaries,"

tax-saving device. The
quick and severe. As

in all such cases, the large major¬
ity of innocent had to suffer for
a

few.

Through the

efforts of the Trust Division

the

some

discriminatory

tax

legislation against trusts had been
removed.

The

growth of interstate trade

barriers

has had

the

attention

thinking people;
They: see in it
danger to our economic develop¬
ment.
Practically every group—
business, agriculture, labor, in¬
dustry and bankingagrees in
in

particular that interstate trade

barriers
group

harmful, yet in each

are

there

are

who

some

are

willing to have special trade bar¬
riers put up which will aid them.
The

drafting of a "Uniform
Ancillary Administration of
Estates Act."

Division

trust

business

FOR

has

not

been

The

most

do is to

can

whatever

uniform

the

see

statutes

ence

Commissioners

meaning

Whether
statutes

are

several

and
not

provides ACCOUNTING EQUlPWlENTfor

States

National has gone

all of the

way

adopted by the
solely up to the

States themselves.

yy yy

The
an

Trust Division has played
important part in keeping the

trust

business

sound

for

banks.

There

the

transition

from

■

;

.•>*•/

Just

•

\•::

now

turbed

.;•••

••'., .-

•

'•"

the world is in

epoch.

the

past,

epochs
see

one

turbed

well.
that

period

Trustmen
the

present

ment'—for

will be

Defeatist

counts,

this

department

ac-

proof work, transit letter writing,

National

;

Typewriting-Bookkeeping Ma¬

chines fill the bank's need for other work
.which

requires

general utility posting

are

machine. These

•

"multiple-duty" machines

posting such records

commercial

loans, FHA mortgage loans, trust accounts,

correspondent bank ledgers, general ledg¬
National's

savings account unit plan for posting pass
book, ledger and journal simultaneously in the depos¬
itor's presence is typical of the time-savings and tight
control effected

over

window transactions.!

All National

any

description

posting job where, typewritten
must accompany

Accounting Machines

are

posting.

A National with

item

count

A similar

available through priorities

factory at Dayton, Ohio, proudly flies the Army-Navy "E" with four stars ★ ★ ★ ★ for
"unceasing excellence" in the production of precision instruments and other war materiel.

Cash
DAYTON

OHIO

special features for printing automatic
analysis posts checking accounts.

float

type of machine but with
is used- for multiple-duty

Our

The National

and

must

dis¬

thinking and acting to
country succumbed in
(Continued on page 1430)
y

which

mortgage and real estate accounts.

dis¬

creative

are

savings accounts, checking

dis¬

for the trust business.

pro¬

applications—machines that

•.

turbed epochs have been creative

generally considered standard equip¬

now

peace

war.

specific machines

are

basis.

know, it has no police
powers, but, by education and ex¬
ample, it has wielded a powerful
influence. This guidance has been
felt through many changes — in
periods of peace and of war and
you

viding mechanical accounting equipment
for many

clear

are

BANKS
every

are

workable.
these proposed

£-

Trust

to it that

proposed by the National Confer¬

was

part

Here, it

institutions

the faults of

aminations

trusts.

consequence

guided

COMPLETI SERVICE
x

also, to the intelligence and fair¬
ness
of' the Federal and State

namely, that of acting as inden¬
i
trustee,
narrowly
escaped
punitive
legislation.
The
wise
and patient guidance of a com¬
mittee
of
the .Trust
Division,

adoption, it

«used

cepts

approval
officials

few that there might

would

ciples, that

ready

One phase of the trust business,

„

formance

The

Government

was

som£ trust
country whose

actually: is.

Trust Institutions

supervisory agencies in their

commended to banks op¬

was

erating trust departments.
When ;this statement

summer

committee
mit

System, the Statement of Princi¬
ples was included in the appendix

paper.

began the
about, and

con¬

between

Division cannot undertake

[

the American Bankers Association

ducted.

country

approved

was

Committee

com¬

petently

the

business

and in the

honor¬

been

tutions

Enabling Legislation On

Common Trust Funds.

measures

trust

There

governing .'the
rights of out-of-state trust jnsth-

Services, Aiding The Formulation And Adoption Of Pension Systems,
Reforming Tax Laws Relating To Trusts, And Uniform Rules Relat¬
ing To Trust Accounting. Reveals That 22; States Have Adopted

over

country

statement

is much confusion
and uncertainty in
many states as
to what the
law

Accomplishments In Drafting A State¬
ment Of Principles For Trust Institutions Which Has Been
Adopted By The
Governors Of The Federal Reserve System. He Points Out The Part
Played
By The Trust Division In Keeping The Trust Business On a Sound Basis.
This Includes Making Trust Services Available To Those In The Armed

credit

men

of New York

Head Of The Trust Division Tells Of Its

the

duct

states.

American

engaging and promoting

restrictive

Vice-President, Guaranty Trust Company

fair statement.

free from

than

years

sector

believe, is

Division

President, Trust Division, American Bankers Association

business. This,
I

Trust

By IIENRY A. THEIS*

State—aimed at the trust business

during the past
against
any

Of The

Work

The

Thursday, October 5, 1944

built-in typewriter
work.

„..

THE COMMERCIAL &

Number 4322

160

Volume

Difficult Than Was Conversion To War,

at war

the

o f
unset¬
i n f l u-

handicap

tling

effects are felt
b y

business

and

industry

and

also

individual1

pelled

usefulness in time of peace.

through

down

is not

all the differ¬

society.' N abanking
bears its share
F.

bur-

these

ment

This

requirement- resting upon

allocations;

through

larger portion distributed in busi¬
ness,

loans.

This, of

course,

our

objective.

and

accomplish¬
banking.
The privilege of dong that belongs
to our guest speakers. But I feel
line any plan for the
of

ment

will

this purpose of

can

doubt that this

not

infringement

their

upon

the

only

Banking

banking

field

entire

broader than the

requirement

R. Peterson

bends, but in
spite of them it has forged ahead
steadily.
•/...■•
The resources of the national

one

alone.

element in

picture.
will

community

Each

want to

effectively its in¬

be shown how

through
dividual citizens and groups can
many years of strict application
to public needs, have enabled it pick up the more or less tangled

banking system, built up

to contribute

effectively in numer¬

to the successful prose¬
cution of the war and, at the same
ous

ways

time, to the conduct of essential
civilian
business. V This
record
brings deep satisfaction.

It proves

business

local

strands

and

fashion them into a durable post¬

how

how far
take over
administer the projects which
and

satisfactorily

those
and

It will want to know

fabric.

war

same

persons can

Government has

been conducting

the force and strength of
that system and its availability for directly or otherwise.-'-.,..
Each move made, in the recon¬
any character of service which the !
exigencies of modern business and struction program will be watched
Government management may re¬ by
an
intensely observant and
critical gallery.
This may add to
quire.
'
The
satisfaction which comes the difficulties of the task,' but,
again

support of any likewise, it will raise the value of
I feel I cannot im¬
is common to organiza¬ the reward.
tions and individuals alike.
It is press too strongly the individual
the reward for the extraordinary character of this task. It is rooted
work demanded, and the impera¬ in the life of each town and vil¬
tive nature of the service is a lage and city alike, and its suc¬
from

Just

aggressive

cause

its performance. Banking cess depends upon the aggressive¬
accomplished its purpose by step¬ ness with which it is prosecuted.
the
boundaries
of
our
ping up its production as each Within
crisis developed. It accepted addi¬ needs and our limitations the keel
tional assignments
each time a of our economy will be re-laid
new phase of the war and its de¬
and, encouraged by its possibili¬
mands was reached. The result of
ties,
the
structure
will attain
all of this was the creation and
whatever proportions our deter¬
the employment of a force con¬ mination and our energies sup¬
sidered adequate to perform every
port.
Wv; v
service within the scope of bank¬
Banking shares heavily in this
ing; a force calculated as suffi¬
responsibility^ It^has: discovered
cient to aid beyond .the sphere,:qf
additional ways, to textend Its. ser»
spur to

actual banking in

achievement ?of

the end which now seems

assured
the

—the successful conclusion of
war.

Looking ahead now, but by no
means

the curtain upon

drawing

essential phase of the current
task, which obviously is not fin¬
ished, arid which in no sense is
being abandoned, there is an im¬
mediate aid compelling necessity
any

for

preparing

changes which are

There is added to the

responsibil¬

show the cleavage of Government
and

private

awaken

business, and
appreciation of

re¬

the

An Even

proper

assistance.

Government

sening either the spirit or the sub¬
stance

port.

...

the

of
\

program

sup¬

foremost, at the

ments.

require¬

It will have to be prepared

general public inspection of
its record of achievements during
for

and it will
blue-print of

the last several years,
have to offer also a

its plans

for the future.

Notwith¬

standing the acknowledged excel¬
lence of its contributions' to the
war

time
and

effort, banking will be com-

experience, in full co-operation

the needs of Business and

public and national ad¬
Banking recognizes the
this

and

query

any

con¬

swer.

25, 1944.
*•>•*:

at
•

7*.

Bankers

American

the
-

which peace-;

offers its facilities;

with other Banks, to meet,I

Industry. Consultation is

invited

Chicago, 111., Sept.

deposits

they

be of help.

reached
any

•

■> •} if

\"J :

Bankers

Trust Company

Service

now,
and
wholly com¬
They have

employed

serving

are

mendable

purpose.

totals

far higher

than in

previous period, and even in

Bankers Trust Company

percentage of current greatly /ex¬

panded assets, the funds employed,
are around the best levels of the
last twenty years.

these

NEW YORK

But in spite of

encouraging

elements,

the
Member of the Federal

Deposit Insurance Corporation

It is not up to

the required
be raised
that, point through an adjust¬

cern.

standard,
to

....

loaning problem in which it is felt we can

satisfactory volume of these

by Mr. Peterson picture lacks the proper balance.
The nature of this employment,
before the National Bank Division
of the Second War Service Meet¬ rather than the amount, gives con¬

ing

getting ahead with reconversion, upon

jobs depend. Bankers Trust Company

*Am address

Association

time

Day, and at the

vinced also that it knows the an¬

banking will

war,

psychological

two

same

)

bigger job—a two-fold

job of redoubling national effort to speed V-J

vantage?"
force

clusion of the
face

greatest

Day marks the beginning of an even

con¬

war

;

First and

the

Banking,

Bigger Job Ahead
_

V-E

same, as Govern¬
ment and some industries, has ac¬
prosecution of the war program, cumulated a stockpile of ma¬
the exaction that plans be laid to
terials—deposits. Their potential
fit banking into the pattern of
value, through full employment in
events to come. The reversion to
the coming months and years, is
peacetime activities will be more
tremendous. The important ques¬
difficult than was the conversion
tion now is "How can that vast
to
war.
Fortunately, though, it
array of materials be used to the
can be accomplished without les¬

ities-hanking has assumed in the

/§.

Tfj#

vicesj and it must employ all of
them to prove that private bank¬
ing still is the most practical in¬
strumentality of financial assis¬
tance to every type of business
and to every individual.
It must

function of each by demon¬
strating what business can do on
important its own. responsibility without

certain to come.

.Xh .vs k'/t

i:
4 ft

*i W V A-Ti CT>

but

u'f

could

i" '-V

* >•, <■*. v. v*

-V.

* * -;i -v

its

assignments if I try
objective can be reached if bank¬ to. emphasize the necessity of put¬
ing will throw the entire weight ting into this effort every facility
of its practical experience and its
(Continued on page 1478)
There

record

weighing heavily upon each insti¬
tution. In fact, the scope of this

tional

its

just a few banks or a representa¬
tive
group.
It is an obligation

strata

ent

again

demonstrate

its

V'l am not going to make any de¬
tailed statement or attempt to out¬

Apply Banking Resources To Civil¬
ian Business And Decries The Infringement of Government Upon
Tasks Considered To Be In The Realm Of Private Enterprise. Urges
Return To Practices Which Permit Individual Planning. °

Their

into the effort.

achievement will rest.

He Foresees Need Again To

vidual.

many

ences.

termination

Banking Will Prove Itself Still To Be The Most Practical Instrumentality
Of Financial Assistance To Every Type Of Business And To Every Indi¬

labors

always
under

resources

other words, the outcome

That The Reversion To Peacetime Activities Will Be More
Mr. Peterson Asserts That Private

While Pointing Out

also.

In
depends
largely upon banking itself. There
is only one way to measure the
capacity of bankihg to perform
any task. That measurement is its
determination, and upon that de¬

N. J.
National Bank Division, American Bankers Association

President,

types of banknation

Banks
i total

£ '•

j By F. RAYMOND PETERSON*

imm»*«TZ»Z^mm»ZmZ-

1477

President, First National Bank, Paterson,

ing, called for the purpose of dis¬
cussing some of the problems con¬
fronting national banking and other
in g

-y

y;/■;, - j.

welcome to this meet^

«**,Mm«

FINANCIAL CHRONICLE

Post-War Tasks Of National
I bid you

.-.4^.^

ft * * •* t •* t-6 ■& •» .ft * ft * t ft ft .£.<•» ft

■*

ftr*. .~t ft --ft-» *t 11

-i' * n r*

" * ' I'i

THE COMMERCIAL & FINANCIAL CHRONICLE

1478

Post-Wae Tasks Of National Banks
marily means business conducted direct and immediate effects. The
privately,
rather than govern- indirect results are the state of
business in our nation will be the mentally. Private enterprise must mind produced, the national poli¬
dominant and the sustaining force find regeneration, and individual cies which are created, the .tradi¬
again some day. The distinction initiative must take courage and tions developed or broken. In our
between civilian and military, in draw strength from the enormity country we have a long:' estab¬
describing the nature of the busi¬ of the task and the far-reaching lished tradition that thevbusiness
(Continued from page 1477)
banking possesses.
Civilian

that

ness,

be carried also, with

must

firmness, into the methods of con¬
ducting it. Civilian business pri¬

effect the results will have.
In this instance the indirect re¬
sults

are more

our

citizens shall be conducted

them

•

individuals

" or

important than the groups. In practice, times of

emer-

Thursday, October 5, 1944

gencies, of course, are excepted.
But in general that has been the

want

for the most part.

for

them
to

constantly.

avoid

What

the

permanent
design, and it has been followed acceptance of expedients contrived

temporary use and entirely
times, how¬ unsuited to continuous applica¬
ever, when this policy has been tion. Vigorous steps to drive them
infringed, even when no emer¬ out are imperative and, for itself,gency- seemed to call for it. There banking,can. accomplish this best
has been, now and then, a dis¬ by demonstrating that it has the'
regard: of -the philosophy, of this facilities, the experience and the
There

have

policy, >; with

been

the

that

regular.

ir¬

other

Upon occasions, the Fed¬

Government

eral

will to give a better financial
vice than is available from

a • bit

result

practice it has become
has

source,

ser-

any

77;:'y-

I ask that all of us unite to do'/
this very thing; that .we remember
sidered to be within the realm of that
the
initiative
required

undertaken

tasks which theretofore

were con¬

to,

private

enterprise.

Fortunately,

keep

the instances were comparatively

though,

rare

they

ported by excellent

were

it makes will show

reasons or re¬

nile

on,

but with progressively less force.
It isn't difficult to

forward

relationship

of energy

pretty defi-,
the amount

expend. ;

what ends

see

must

generated largely within banking;
itself, and that the advancement

sup¬

sults, and the tradition lived

moving

mjsrs
■

such practices may lead to. Once
tradition ii violated notoriously,

tea

each succeeding infraction is more

easily

accomplished

less resentment.

and

It is

arouses

readily

condoned.This can mean only
that if a plan resorted to in time

fiss'n Of iastk Mifers
,

;

•

'» '■

•.

•

■■

At the final session of their an-,

nual

of emergency; even to achieve an

meeting just' concluded at'
Cleveland, Ohio, John C. Shea,'

essential

Assistant

not

but

temporary purpose,

abandoned

emergency passes,

day: will

that

make

difficult

the

much

resumption

the

Therefore,

duty resting upon

one

dency of The National Association,
of

Bank

Auditors and

Comptrol-"

lers.

Mr. Shea has been advanced'

succeeding

when he
officers

since

year

1940/

first elected to

was

strive, after the tional office

close of the war, and also prior to

that time,

the-

each

Orthodox practice.

each citizen is to

Vice-President

soon as
the Whitney National Bank, New Or-!
each additional leans,, was advanced to the PresK
as

Treasurer.

the

na¬

Other!

Association

arej

the extent that its First Vice-President, Ben Jenkins,;
progress will not ber retarded, for Assistant
Vice-President,
First
a

return to the customs and prac¬ National Bank & Trust Co., Ok-;
which gave, our people op- ilahoma City, Okla.; Second Vice-'

tices

R. y Burbett,*
portunities to plan for themselves, President, • Arthur
to become self-reliant and aggres¬ Comptroller, First .National Bank/
Baltimore, Md.; Secretary, 'Mills
sive.. In short,, a nation founded
upon the principle that, it' belongs jB. Lane, Jr., First Vice-President,"
,

Citizens
& vf Southern 7 National*
Bank; •; Atlanta! '-; Gai;^ Treasurer/
Pbul; D.; Williams^: Comptroller/
as; such citizens, should not de¬ Corn
Exchange National Bank &'
part from that principle so long
Trust Co., Philadelphia; Pa.
;
\
as it' yields the best results.
;
to its

citizens, and that they shall
its" trade

conduct

and

commerce

;

A nation V: which y has become
great through - observance of this

having, been advanced in the of¬
to be fol¬ ficers' line.
Mr. Powers, the retir-1
lowing the best course to preserve
ing President, will become an Ad-;
that greatness unless it insists
Visory Board member,,which po-:
constantly upon a • policy which, -jsition he,, will hold four
years.a ssures
its ' citizens thegreatest Other members of. the

principle .doesn't

#t?iF

seem

possible participation in the

The American

Tropics

now furnish

the Western

World with its essential rope

supply !

duct of all of their affairs.

involved.

Today nearly 30,000 acres
of abaca are flourishing in the
American tropics. Enough is being
harvested noiv to meet the needs of
our
fighting and merchant ships.

Philippines—source of 95% of

the manila rope so vital to our
Navy
and Merchant Marine—the situation

looked black, except

for

thing
2,000 acres of abaca seedlings
( manila hemp) were growing down

one

in Panama, on an

As far back
ment of.

tested member of the

ever-growing
society of strategic crops in the

develop¬

strains of abaca suitable for

the American

Western World.

■

started in Middle America

the

atmosphere
ically

are

far

back

Great White Fleet is

of foresighted men in the U.S.
Department of Agriculture.
quest

needed

for

war

longer

service around the

world—and the

that

We are

the

from

the

normal

long .road

beset

■

National Bank of. Detroit.

}

President Shea in his inaugural
address announced
the appoint¬
ment

known

new

the

committee

Research

Commit¬

tee, with past President Ottmar A.
Waldow acting as Chairman. This

oils—abaca will

valuable addition

prove a

peacetime trade

between the Americas.

and

■

lacking in
.'■■ v
,

bal¬

faces

moves

ing outlined at the start.
The
tion

along

By-Laws

were

amended

the
at

Associa-'

this meet¬

ing to orovide for the election of
six

directors, and the appointment

that
of a Vice-President for each State.
of
determining
which
of
the
practices we have picked up in The newly elected directors are
the emergencies of the war period Richard I.. Brower,
Auditor, Bow¬

ways

essential

■

this tortuous, exposed road, is

are

four Middle American governments

econom¬

One of the important tasks our

place in their capacious holds. To¬
gether with other strategic crops de¬
veloped in Middle America during
the war—-rubber, quinine, rotenone,

stringent and ever-in¬
creasing demands for rope in the war
emergency, the United Fruit Com¬
pany expanded the abaca plantings
at
top speed. In this strictly non¬
profit undertaking the Company has
been given full cooperation by the

laboring

which

stability

untried

are

ance.

ships return to their
Caribbean routes—abaca will find a

To meet the

artificial

are

with
new
research
program
to find
many dangers. Some of them are
better auditing and operating pro¬
unusually perilous because they cedures for
banks will start at
hold out plans with some measure
once.
A two-year program is be¬
of attractiveness, but actually they

When the United Fruit Company9s

re¬

life

quite unsound.

removed

way

are

now.

conditions

under

country

tropics had been

Board'are Charles Z. Meyer, now

again need our hemisphere
depend on the Far East for "sea¬
going" rope. This is now a tried and

Company.

1925 the

■■■:

Never

experimental farm

of the United Fruit

Advisory;

con¬

serving in the U. S. Army; Cecil;
The course of events in America W. Borton, Vice-President,: Irving'
in the near future probably, will Trust. Company, New York, and;
shape its destiny for; many; years Ottmar. A. Waldow, Comptroller,'
to- come." We

"YVTHEN the enemy invaded the
VV

Mr, Williams is the new. officer
in' the. official family, all others';

sound and suited to

of life and business.

our

way

It is not al¬

ery

Savings

Bank,

New

York;

B. N. L. Davis, Auditor, Seattledistin¬
First
National
Bank,
Seattle,
guish between the constructive
and
the
impractical
methods. Wash.; L. H. Hammerstrom, Audi¬
a

Neither

simple matter to

can one

be certain always

tor, Continental Illinois National
even though it Bank & Trust
Co., Chicago, 111.;
be constructive, actually fits
Don Houser, Auditor, Third Na¬
into the plans of a people accus¬
Bank,
Nashville,
Tenn.;
tomed to doing things for them¬ tional
selves, Temporary and satisfactory Edward F. Lyle, Comptroller, City
that

proposal,,

may

employment of plans in a period

National Bank & Trust Co., Kan¬
throw about sas City, Mo.; Sumner
Sinclair,'
them a surface glow which could
Auditor, Northwestern National
be ! mista ken, for ingrained color.
It is our job to be kble to recog- Bank, Minneapolis, Minn. Presi¬

emergency

hize- each

may

these types,

and to

dent Shea will

announce

the ap¬

retain only such of them as would
pointment of State Vice-Presidents
add to the enjoyment and the pro¬
at an early date, : and also mem¬
,

UNITED

FRUIT

COMPANY

ductivity of American life.
GUATEMALA

★

El SALVADOR

PANAMA

★

HONDURAS

★

COLOMBIA

Back the attach..

CUBA

buy

★

NICARAGUA

★

JAMAICA, fi.W.t.

War Bonds!

COSTA RICA

bers of the several standing com-,
Applying this philosophy to our mittees..::
" *v
own business, none- of us would
This
convention: j ust ? closed "
decline to accept practical im¬
provements in. hanking. Wenot proved to have a record-breaking

only welcome them, but we search attendance of 700 people.

THE COMMERCIAL & FINANCIAL

Number 4322

Volume 160

CHRONICLE
A

Spending Or Saving Our
(Continued from page 1475)

;

sinned

far and so long against

the principles
and prudent

today

are

of sound economics
public finance that
grave

very

basis,for

ing

payable on demand was the
talk that went with their
distributioin in at least the first
three War Bond campaigns, the
talk that a citizen could at the

most

;of

ever

greater spend¬

free both; from
prevailing wartime

one

spree,

the

restrictions, and also from the dis¬

cipline

which

many

-citizens

are

principle to be kept intact for at
least a generation.
•
'
The second responsibility of the
banks will be in relation to the
,

savings other than War
Bonds that are the subject of so
billions of

danger.
\

Companies

the

total

which

figure

-j;'

same

time

his

liquidate

culation

nor

included neither
in cir¬

billions of individual

pile upon that unsound foun¬
expenditures of a glo¬

bal
no

today by

the.structure is

war,

will be
forth by

That it

secure.

means

weakened from this time
'

appreciable addition' to the
public ^eb^ everyi informed pei>?
5 son is convinced.
,
every

Thus it becomes

imperative, im-

mediately the war is,oyer, that
there be adopted for the govern-

nient', particularly for the Federal
establishment,. a policy of saving
as against spending.
This means,

the

first

V in

the

total

instance, a reduction
costs

that

estab¬

lishment to the lowest figure con¬
sistent with the performance of
essential Federal services. To be
sure,
a large
miltary organization will have to be maintained
for years to come.
The regularly
established departments and divi¬
sions .of government will always
.

:
.

they will be
appropriations com¬
mensurate with the valuable pub-

have to function and

entitled

.:i; lie services they 'perform.
And the costs of these

essential

.^ services, including Jhe carrying
(v charges
on the public-debt, must
be covered entirely by taxation.
•.It' is: my own opinion that in the
first full fiscal year after, the end
of the European war the budget
•f ■ should be balanced and should be
'•
>kept in balance, a course of action
•

■

which would involve both govern¬

■

ment

saving, and saving also by
and -"corporations in

individuals
order

meet

their tax liability.

' Above everything else,

": '

spending

sake; spending to
provide consumer buying power,
spending to provide jobs without
regard to the value of the work
undertaken, spending to maintain
for

spending's

huge Federal bureaucracy

CHAIN television is here! With the Trans¬
dedication of the
Philco Relay recent

which

new

itself, if it were
able; spending of these and of any
other varieties except, as it in¬
volves a quid pro quo, must be
stopped as soon as possible if eco¬
nomic stability is to be more than
a catch word, and if the peace is
to be clinched after brilliant mili¬
tary victory has been won.

would perpetuate

But

public

saving

curtailment

sharp

•

the 23 billions of currency

dation the

Bul¬

the Life In¬

obliga¬ voluntarily imposing upon them¬
deposits in commercial bank ac¬
much current discussion wherever
1
'
'
• •
■.
tion to the government by buying selves. ■ '
" Had our prodigality been con¬
counts, in both of which there is
and whenever the outlook for the
It is my firm conviction that
fined to the years before the war, War Bonds and pay in advance
presumed to be, particularly at
post-war period is considered.
for a' new post-war; motor car or the
bonds
payable on demand
there would have been time prob¬
this time, a considerable sediment
Almost any day one lays eyes-on
of savings.
ably to reverse our course and helicopter or finance a vacation along with billions more of shortA"JTreasury obligations - will a news story or an editorial or a
trip to the devastated regions of term
maintain the stability of our fi¬
Writing recently of this same
need -to be refunded into long- column the thesis of which is that
Japan (I hope).
nancial
institutions.
Or
better
fund
of
"savings" Marriner S.
the transition from war to peace
I need not tell this group, I am term bonds bearing a rate of in¬
still, had be kept the house in
will be easy because the American Eccles, chairman of the Board of,
terest- thats will?encourage
new
order between 1933 and 1941, we certain,
that there can be no
Governors
of the
Federal Re¬
has
billions
of savings
could have borrowed and spent sound post-war economy if a sub¬ and continued thrift and accumu¬ public
serve Board System, said:
;
as
far as the exigencies of the stantial portion of the bonds pay¬ lation, bonds that will then find which it will pour out for about
"The inflationary potential
their way into the lock boxes of every
wanted
commodity and
war demanded, without seriously
able on demand are redeemed for
of service immediately the commod¬ which, it is estimated, will exist
undermining the foundations of cash at the earliest opportunity literally / scores of millions
on June 30, 1944* measured by deities and services in question are
our economy. ■
after the end of hostilities and the small capitalists to be held as per¬
manent parts of their estates, the available'.
(Continued on page 1482)
'
But because we chose impru¬ funds thus secured used as the
dence instead of prudence in the
1930's and were then compelled

in America
accumulated
savings in the United States at the
end of last year at 95Va billions,
placed

sales

"Anti-inflation

published

surance

tions

recent

letin"

mitter at Mt. Rose,

Philadelphia, New York
Schenectady, is in actual operation today.
Now Philadelphians enjoy clear reception of
programs from New York through their local
and

Philco television station.

sands of miles away

and

billions

very grave error, one

have

the

enormous

was

which will

to be corrected in the

future

hundreds

sound

post-war

economy

ADVANCE

and

experience
progress.

television

PbUco-«rbbfnfwresiUnS ^ othe\
news
scene

coast.

coast to

At the

same

time, Philco

re-

search is improving the clarity, sharpness and
detail of the television picture... so' that future

;

sets will have the
greatest possible
appeal. Thus in two ways... by helping to
broaden the market for television, and by designing a more saleable product for that market
Philco leads toward the goal of television
as tomorrow's "billion dollar
industry."

television

sales

Radio Hall of Fame Orchestra and Chorus.
Tune in

Sundays, 6 P, M, E, W< T., Blue Netivork.

BACK

THE

ATTACK

well as

OF TELEVISION

cre¬

Only slightly less ' indefensible
its dependence upon obliga¬

'arch

for

PHILCO RESEARCH SPEEDS

ated.

than

early

danger inherent Nin
burden of floating

indebtedness is to be avoided and
a

and operated its
television static ,
rich laboratory of re

own

example
how Philco research is working to
establish transmission principles which
can, extend chain television broadcasting from
.

several

1932.

owned

This first television network is an

passing. I must say that the
stubborn adherence of the Treas-

ury to these demand obligations
in the financing of a war costing

«LEV.S.OMEROW^

THE

but in

by television.

st,nG

The

HOW

here - you
liability, as

regards the, disposition by , lthe
public of War Bonds, largely E
Bonds, payable to the owner vir¬
tually on demand; This is not the
time
or
the place, perhaps, to
discuss the financing of the war,

...

PROGRAMS
TELEVISION ST

PIONEERED I"

Since

Thus the first step

through which millions will
eventually witness events that take place thou¬

Individual thrift will need to be

encouraged:-.'first,

HAS

has been taken

and a very
in public

bankers have a heavy

PHILCO

Network, linking

spending must be complemented
by private and corporate saving,
by thrift, by new capital creation,
and by private capital investment
running into the billions every
year for some years after the war
y, ends, if the traditional American
economy is to be preserved.

VV1T„

N. J., the first Television

BUY

WAR

BONDS

the

ove

radio f

of action*

1480

THE COMMERCIAL & FINANCIAL CHRONICLE

Winter Trust

The Work Oi Trust Division
'30's

give us security
against the world, against nature,
and against one another. Actually
they contributed to our insecur¬
ity. The extent to which we as
were

nation

had

by 1933 reached a
stagnation state in society is evi¬
denced by our abandoment of our

lished

March

issue

of the

Trust Bulletin.

Because
and

V';\:

of wartime

conditions,

particularly travel conditions,

visits
what

New

were

some¬

Consequently, Mr,

limited.

Selecman

York

and

felt

that

the Trust Division
traditional policy on the freedom to as many communities in the
of the seas and by the adoption country as we possibly could by
of
neutrality legislation.
Inter¬ visiting them. To carry out this
nationally we became the inert program, I addressed the bankers
and unwitting victims of circum¬
and trustmen of the New Jersey
stance, instead of the master of State Bankers Association, and of
circumstances.
the California Bankers Associa¬
the

field

nomics, too,
feat to

deceived people
may

eco¬

economic ills.

cure our

Utopia

domestic

adopted self-de¬

into believing that

be obtained by spend¬

should

tion.

bring

spoke before a group of
Atlanta, and in Port¬

trustmen in

I visited the trust

land, Oregon.
institutions
Louisville.

of
I

New

Orleans

addressed

the

New

tin.

The

six

York, and the Mid-Continent Con¬

This

the

ference in Chicago.

(Continued from page 1476)
the

Conference

and
Mid-

The

war

necessitated

cancella¬

tion of the West Coast Trust Con¬
ference
In

for

order

the

that

past three years.
many of the insti¬

law schools

sorption

located

year.

His

included

the

publishing of six studies in trust
business, lectures, and visits to
trust institutions.

The six studies

published
as
bi-monthly
supplements to the Trust Bulle¬
were

by
the

the

icies, investing trust funds under
the

Prudent Man Rule, and com¬
stocks for trust investment.
Trust institutions are playing an

mon

year

banks

The number of trusts under these

cities, in 44 States.

plans administered by trust insti¬
tutions is increasing.
While the
companies themselves work out

with

and

discussed trust

trust

companies, law¬
and life insurance men.

The field of investment of trust
funds

had

our
attention during
Our Committee on Trust
Investments published its report,
"Shop Talk on Trust Investments";

the year.

addresses

were

made and articles

in the Trust Bulletin appeared on

post-war

important part in pension and
profit sharing plans adopted by
private enterprise to meet social
obligations to over-age employees.

institutions

total
of
4,800
people, mainly trustmen, bankers,
directors
of
and
attorneys
for

yers

activities

trust

these trips he

business

Mr. Stephenson, Trust Research
Director, had an unusually busy

than

result of the ab¬

334

vision, Mr. Selecman visited trust

Chicago;

visited

institutions

ciary associations in Los Angeles,
San Francisco, Portland ahd Se¬
attle, and also Minneapolis and

number

young
men
services. During

current activities of the Trust Di¬

fidu¬

delivered

were

larger law schools.

smaller

covered, due en¬
tirely to the reduced attendance at

armed

addressed

the

those previously

tutions
in
this
area
might be
brought up to date personally on

and

lectures

of
is

Thursday, October 5, 1944

trust

investment

pol¬

and develop the plans for their
employees' trusts through their

actuaries and

attorneys, trust in¬
a certain responsi¬
bility in accepting duties under
such plans. These plans touch the
lives and economic wellbeing of
large numbers of people. An illstitutions have

advised
or

subject

may
as

plan,

the

terminated

material

defect

the

employer,

trustee,
to

plan,

well

unfavorable

ing and wasting, by allowing peo¬
ple to feel that the world owes
them a living, that the Govern¬
ment Will work and plan for them,
and that they need not do any¬
thing, for themselves. We preached
that laziness and profligacy are
virtues; work and saving, sins. We
weakened bodies and broke souls.

Who

knows

that if, in the
taken a positive
stand instead of the negative one
which we chose to take, in both

'30s,

but

had

international and domestic af¬

our

fairs, events abroad and at home

might have been
It

from

Strides

are

the field of

tion of

arouse

preoccupation with
so-called
security.

our

thoughts

different?

Harbor to

took Pearl

daily being made in
science, in the produc¬

materials, agriculture,
Will the nation,
aroused in war, remain aroused in
peace? Will we rely upon courage
and initiative, or will we revert
to defeatism and pacificism?
raw

and manufacture.

On behalf of the trust

business,
Progress
means change — not in the funda¬
mental principles set down in our

promise

Statement of
•

quality of

progress.

you

Principles, but in the
service and in mak¬

our

ing our facilities available to an
ever-increasing number of people,
to the end that the social benefits

derived

through the mech¬
may be enjoyed

anism

ever-enlarging number of

trusts

people.
Ever since the

beginning of the

trust institutions have made

war,

available
and

men

their
women

services

the

in the armed

ser¬

vices, to their families, and to ci¬
vilians engaged in war work. Dur¬

ing the

new committee on
Affairs, under the chair¬
manship of Chester R. Davis, was
appointed.
This committee has
made a broad study covering the
desirability, in the public interest,
of accepting appointments on be¬
half of veterans, the best methods
of handling them, and the fees

year a

Veterans'

When fortress
slate against
—for

and costs involved.

During

year

relations

our

harmonious.

have

underwriters

there

has

been

continued
both

serve

fields

constructive

co¬

of the

continued

Government

charge

and

Trust

Division

work

with the

bureaus

control

American ideals and

phase of this

tion.
Members

only half
our

fight to

won.

pre¬

living standards

will be ended. The economic battles—the

operation, with the interests of the
public the paramount considera¬

have

Japan is wiped clean, Victory

America—will

Only the military phase of

with members of the Bar and with
life

Europe has fallen, and the

the

having
foreign

war

that intimately affects

daily bread of

remain to be

every American—will
fought out here at home!

funds and securities and all prop¬

erty under the jurisdiction of the
Alien

Property

have observed the

How

regula¬

prepared for the shocks of this
coming conflict? Shocks which must be

withstood

Custodian, ' and
spirit as well as

the letter of the laws and
tions.

The

trust

institutions

the

country serve thousands of bene¬
ficiaries.
These beneficiaries are
not

organized.

can

are we

by American industry, if Ameri¬

homes

are

to survive.

Many of them are

widows, orphans, -minors, and in¬
competents. A substantial number
are in the war services. They can¬
not well speak

their

trustees

for themselves. As
have both the

right and the responsibility to
speak and act in their behalf. To
this end, we asked the nationally
known analyst of public opinion,
Elmo Roper, to make a survey as
to what some of our customers'
main financial concerns are. The
results

this

survey

were

pub¬

THE IRON AGE

•

HARDWARE AGE

DEPARTMENT STORE ECONOMIST

•

BOOT AND SHOE RECORDER

COMMERCIAL CAR

JOURNAL

•

THE OPTICAL JOURNAL AND

THE SPECTATOR LIFE INSURANCE IN

Volume

THE COMMERCIAL & FINANCIAL CHRONICLE,

Number 4322

160

criticism. Trust

termediate

institutions, there¬

Our

Committee

Court

Richard

which

fore, have a direct interest in the
proper development of sound and
bona fide employees' trusts.

Accounting, of
G.

Stockton

executive
of this

committee in

year.

chairman, has prepared

tution

which

Employees'
Trusts made an important con¬
tribution to the thinking on this
on

that every trust

ommended

cellent

report
will

a most ex¬
this question,
published shortly

in the Trust Bulletin.

February

This statement

should

have

definite

rec¬

insti¬
pol¬

icies and procedures with respect
to voting stock, and then outlined

certain policies for the considera¬
Act, passed
tion -of trust institutions.
important matter, in its report by Congress in February, 1944,
During the
past
decade
the
published in the November, 1943, largely through the efforts of the
Trust Division has issued
from
Trust Bulletin.
An able address Trust Division, made a number of
time
to
time
important State¬
on
the
subject
of
Employees' technical changes which remove
ments of Principles and Policies.
Trusts was delivered at the Mid- certain
inequitable
provisions
It seemed desirable to gather to¬
Continent Conference.
A panel with respect to estates and trusts
gether these statements in a sin¬
discussion,
participated
in
by that had arisen under court and
gle publication of the Trust Bulle¬
trust, actuarial and insurance in¬ administrative interpretations of
tin, in order that they might be
terests was given at the Mid-Win¬ prior tax laws.
available in handy form for reter Conference in February. The
The Committee on Trust Pol¬
study by trustmen throughout the
committee has kept in touch with icies, after making an exhaustive
country. It was felt particularly
developments in the bureau at study of practices in connection
important to republish these state¬
Washington on pension trust mat¬ with the voting of stocks held in
ments at this time because of the
ters and has had the privilege of trusts, issued an important State¬
many
changes that have taken
exchanging views with members ment of Policies for Voting Shares
of the staff.
of Stock Held in Trust Accounts. place in the personnel of trust in¬
The

special

committee

The

Revenue

This report was

In¬

1943

approved by the

stitutions.

The

June issue of the

Trust

1481

Bulletin, therefore, was de¬
republication of these

voted to the

statements.

This study will deal with
interpretations
and
regulations'*
relating to the estate and trust
sections of the tax laws and lead¬
,

has

been

apparent to many

trustmen that there has been con¬

siderable

misunderstanding, par¬
ticularly among legislators, as to
the part played by the trust in¬
in

strument

our

social

economy,

A study is

being made of the his¬
background and the de¬
velopment of trusts, their use as a
torical

medium' for

the

conservation

the* benefit of de¬
pendents, and their importance in
the general social and economic
scheme
of
our
whole
property
property

for

system.
A

time.

second

-v

:/ y

phase

will deal with the

this

study

history of Fed¬

eral taxation of estates and

trusts,

beginning with the 1913 Revenue
Act,

showing

velopment

the

down

statutory

the

de¬

present

ing court decisions. Some of these
have

led to uncertainties and in¬

equities.
The third phase of this
study/
therefore, will deal with proposals

amendments

for
to

the

tax

laws

these uncertainties and

remove

inequities.

During the year 1944 the Legis¬
of
only one State acted
upon the Trust Division's recom¬
lature

mendation
tion

for

common

enabling legisla¬
funds, and adop¬

tion of the Prudent Man Rule for
trust

investments.

Virginia is the
permit, the formation

last State to

common

the total

trust funds and

number to

brings

22.

The

credit for what may have
accomplished
during
my
term of office belongs not to me,
but to a large extent to the chair¬
.

been

and members of the commit¬

men

tees who have done the real work,

had

all

times

the

full

co¬

operation and wise counsels of the

officers, and the guidance of the
executive

committee.

But

above

all, the source of the power which
keeps things moving in the Trust
Division

his

staff

able

Merle

Gildersleeve,

Selecman,

and

assistants—Miss

Miss

Leslie,

Miss

Schumm and Miss Ilenker.

;

y y

«—

i—

Finney Again Heads
WF6 Public Relations
Peter

Finney has beeen ap¬
Assistant' to
the
State

pointed

Chairman,
Relations

charge

in
for

the

Public

Treasury
Department's War Finance Com¬
mittee for
nounced

New

York, it

was

an¬

Sept. 28 by Frederick
W. Gehle, State Chairman.
Mr.
Finney
was
the
War
Finance
on

Committee's first Director of Pub¬

licity, when the organization was
known
as
the
Defense
Savings
Staff.
He came to the Treasury
Department from the advertising'
agency of Arthur Kudner, Inc.. in
September 1941. A licensed pilot

From

for

many years, Mr. Finney re¬
signed from the Treasury in De¬

1941

high (in profits after taxes),
the over-all return of large corporations
had dropped last year nearly 20 per cent—
despite a much greater volume of business.
And these disturbing figures from the
Federal Reserve are bracketed today with
dolorous forecasts
experts estimate
that 3 of every 5 plants now pouring out
hundreds of weekly millions in war-roll
a

cember 1942 and entered the
Air

new

work within six months

Banks

Qualify To Redeem

War Bonds Under New Plan
More than

risk

know that

reserves

all

and

needed

are

that

"blood

bank"

The

Chilton

sources

Company

and influence

(Inc.)

Publishers

transfusible

has

International

AMERICAN

NACIONAL,

are

world-wide. Chilton

100

East

56th

and

42nd

Sts.,

Street,

AMERICANO,

(Overseas Edition),
INGENIERIA

York

the

INTER-

Heretofore

bonds.

handled

were

direct

and EL FARMA-

N. Y.

the

•

THE JEWELERS'

CIRCULAR-KEYSTONE

•

AUTOMOTIVE AND AVIATION INDUSTRIES

de¬

D. & W.

the

Secre¬

hope

for

huge sums still are re¬
emergency

war

they

are

ex¬

He said every bond

should

remember

that the

bonds increase in value the

MOTOR m
M-

•

some

that
the
simplification of redemption pro¬
cedure 5will not encourage bond
owners'to present bonds for pay¬
ment except in cases of absolute
necessity.
Mr. Morgenthau point¬

penditures.

THE SPECTATOR PROPERTY INSURANCE REVIEW

time

same

expressed

tary

owner

OPTOMETRY

involving

Morgenthau termed
nation's bank¬
ing industry to the new program
"extremely gratifying."

quired

•

upon

Secretary

ed out that

the response of the

A
ACTION

through

application to the Treasury,

procedure
lay.

CEUTICO.

REVIEW

payments

check

the Federal Reserve banks

Industrial Edition, INGENIERIA INTER-

(INC.)
17,

plan, which becomes
permits banks

new

satisfactory identification of the
applicant owner, * in
redeeming

Philadelphia 39, Pa.
New

el¬

to make immediate payment upon

equal interest in Business
publishing THE

NACIONAL, Construction Edition,

Chestnut

are

effective October 2,

Corp.,

AUTOMOBILE

AUTOMOVIL

COMPANY

that

says:

investments.

CHILTON

10,000 banks, 70% of

institutions

such

igible, already have qualified to
participate in the Treasury's plant
for
simplifying
redemption
of
Series E War Bonds, and Series
A, B, C, and D Savings Bonds,
Secretary Morgenthau announced
on
Sept. 26.
The announcement

the lifeblood of all busi¬
they, alone, can furnish the
plasma to safely cushion economic shock.
And we, at Chilton, shall continue to work
energetically for tax law revisions which
will permit industry to accumulate its vitally
capital

ness

was

flying training program Tasl May, V;
Mr. Finney was released to the
Bell
Aircraft
Corp. at Buffalo,
N. Y., where he served as a test
pilot until now, when he rejoins
the Treasury Department.

after Hitler's fall—or close their doors!
Here at Chilton,

Army

flight in¬
structor and later a Flight Com¬
mander
at
the
64th
Army Air
Forces Flying
Training Detach¬
ment at Camden, S. C.
When the
Air
Corps began * curtaililg its

...

checks must find

Forces.

held.

longer

Thursday, October 5, 1944

FINANCIAL CHRONICLE

THE COMMERCIAL &

1482

carrying the public debt, I have

(Continued from page 1479)
and currency, sav¬

mand deposits,

ings deposits in banks and govern¬
ment securities held by business
concerns

and individually, but ex-

government securities
life insurance com¬

eluding
held

by the

panies and banks, will amount to
194 billion dollars.
This com¬
.

with liquid holdings as of
1941. ... of 71 billions.
In other words, there will have
been an increase in the three-year
pares

June 30,

period of 115 billion
What
these

and

portion, or

"savings"

what part

merely

dollars."
proportion, of

are savings in fact
of them represent

deferred

buying

power,

profitable in¬
to decisions
which would channel the bulk of
these funds into productive cap¬
ital, and that, on the other hand,
a course of action which continued
to. place spending above
saving
and was predicated on the notion
that spending makes jobs would
pave the way not only for great
extravagance in personal expend¬
itures but possibly for an orgy of
inflation from which there would
flow naught butUnsecurity and
able

long term

vestment would lead

unsound economy for years to

come.

r'y-

It is not

.*:■/•

But in lay¬

friends the im¬

cry

better knowledge

and importance

that

private savings, individual cap¬
ital accumulation, in a free enter¬
of

simple.
lated

for

finance that

tasks

long

scarcely

are

right.

for

there

this

project

and

that reform./

and for the short term, at

than the

con¬

lions

able

least, the wrong is more pleasant

bil¬

proposed expenditures of
another 5 billions here/and 3 bil¬
cern

many

distinguish the right from the

little
that because the debt is

have makes just a

already far in excess of 200
lions there is no occasion for

will be

have vio¬
of the
public and private

nation

tenets of sound

little bit added to what you

bit more,

these

without

inflation

already

prise economy.
Neither

decade

last

this
I have long believed and
of

of the firm conviction today
that the kind of economy those of
this

room

have

would

stored at the end of the
not live and thrive

the

sound

within

the

capitalist

sys¬

economy

framework

early

starting point in restoring
post-war

re¬
can¬

1% money

that

and

money,

war

tem

must

rate of interest which will be

once

the reestablishment

to new saving, both

spur

individual and

index

corporate, and an

fair

profit

applied

to all invested funds.

forcefully/" against

argues

of heavy

continuance

of the

uneasy

implications

; As I indicated earlier in my re¬
marks the fact of an already huge

clebt

term

policy.

arising that, like
the cry of wolf in the well-known
fable, it is widely disregarded,
A
Then there is the
philosophy

and understand¬

ing of the place

the

grave

tremendously

long

of inflation has been heard so

often

portance of government economy,
of saving by the government; the
other of reeducating them .to a

wrong,

difficult to tell others

what they should do.

and customers and

been

Prosperity

Spending Oi Saving Our Way To Post-War

public

ex¬

For
omy

last

analysis

this

ours

is activated

profits;1 and

prospect

commensurate

with

econ¬

the

profits
risks

the

of
Inevitably there will be a wide
informed ing the foundations of a sound
penditures in the future.
business and
commercial enter¬
pretty and insistent popular demand for
own im¬ post-war economy it is
How with social security and
clear to me that the banking fra¬
prise are not measured by the
renewed public spending because,
pression is that the real nature
the love of-present satisfaction rate of
interest either paid todav
and significance of a substantial ternity has two heavy responsi- after billions of spending and bor¬
that is •reflected in the events of
by. the savings banks or by. that
bilities(-both of which are the sub¬ rowing, many are seriously, won-:
part of these savings is still to be
the/last few years we shall be able paid by the government in financ¬
One is dering if the dangers in that: to alter the thinking of the indi¬
determined, that a course of action ject of my remarks today.
ing the largest portion of the war's
The vidual with respect to his obliga¬
to impress upon their depositors course are real and genuine.
and a broad public policy favor¬
costs.
'
.//, /■■•/' ■A^y///Ar ' ,//•/'/■
tion .to save, I am in doubt.
The

there
no

way

far as I am

of knowing.

promise of. security that govern¬
ment in this country and in other

...Extend Mail To France

(in exchange
for the sacrifice of personal free¬

nounced

dom)-is not going to be easy to

ation has been received

countries

KIDDER, PEABODY & GO.

cope

with.
But unless the true
security is understood

basis •' of

the

future, the
promised se¬
curity created in the last few years
will fall of its'own weight, be¬
better

1865

FOUNDED

holds out

early
of

whole'structure

MEMBERS AMERICAN BANKERS

ASSOCIATION

ly-on

one

other matter which

CHICAGO

PHILADELPHIA

BOSTON

statement

dition.
r

ALBANY

PROVIDENCE

SPRINGFIELD

your

banks'

from

the

United

States

The Departments to
vice

extended

upon a sane,

fight

Seine

(including

Paris),

most

Consequently, International Minerals & Chemical
Corporation is proud

to salute

the

possible figure, the cost of

communities

of Calvados and

the

to every

doing

still the

of business and. to every

type

ples of the American banking fraternity, expressed

individual.

during the Annual Convention of the American

The banks of America will

Bankers Association in
Our banks like

duction

ways, to

the

same

our

Chicago recently.

factories have stepped

contribute effectively,and in

war.

war

American banking

numerous

the successful winning of this

have

building the brave new world for
work after the

up pro¬

time, they have continued their efficient

science,

courage

over.

vital part in

which

we must

The statements of

leaders in theChicago meeting

show that they accept

this responsibility with

and

common sense.

con¬

•

LOUIS WARE
President

INTERNATIONAL

MINERALS.
20

NORTH WACKER

city

Seine-

CHEMICAL

DRIVE, CHICAGO 6, ILL.

Departments

Manche.

practical system for providing financial sus¬

tenance

the ideals and princi¬

ser¬

money,

they have proved again that banking is

sound and solvent financial structure.

Cotes-du-

Seine-Jnferieure,

conduct of essential civilian business. In so

must rest

which

are:

The Brave New World

French

Banking Will Help Build

world for which

ington 25, D. C., that limited mail
service was resumed September

the Ncrd, Eure, Eure-et-Loir, IUe-etVilair.e, Mayenne, Orne, Sarthe,

From the time the Treasury be¬

lowest

new

the

from

con¬

It is .the rate of interest,

thev. purpose of reducing to the

The brave

•

Office Department at Wash-

gan,

BALTIMORE

LOWELL

Post

putting heavy pressure on the et-Mame and Seine-et-Oise. Z. On
market .and depressing the September 9 service of this char¬
fate of. interest/ presumably for acter was made available to all

NEW BEDFORD

NEWPORT

HARTFORD

Sept. 25 that inform¬

close to your hearts and to

the undivided profits item in

YORK

//•;

an¬

Departments,
including
the city of Paris.
The service is
restricted to non-illustrated post¬
cause it is just as strong and just
as weak as the public credit,
v./:"7"''' cards of a personal character writ¬
- ;/
In closing I wish to touch brief¬ ten in' English or French.
very

NEW

Postmaster Albert Goldman

CORPORATION

•;

Volume

160

[•HE COMMERCIAL & FINANCIAL

Number 4322

1483

CHRONICLE

Days and weeks of silence from the pretty little wife

later home

that he'd left behind

provided. Yes, the American Red Cross is doing what it

with her.

just when he'd most wanted to be

Then this, brief but

born—Mother

joyous message—"Son

doing fine." You

bet that he

can

ciates the American Red Cross. For it

that got
for

the

message

was

the Red Cross

through that substituted happiness

anxiety. The Red Cross

was

This is the

everything he'd want to do for her—as well as

everything she'd want to do for him. And this story might
be

repeated countless ,times all

over

the world. So let's give a

sible— to this fine

right there at home,

too—Nurse's and Dietitians' Aides in the

appre¬

can

nursing service to see that every little care was

organization which knows

eighth of a series of advertisements dedicated to the American Red Cross by

THE HOME INSURANCE
FIRE

•

COMPANY, NEW YORK

AUTOMOBILE

•

MARINE

the country and all

hand—a helping handif pos¬

reward than satisfaction in

hospital;

over

other

having been of service.

THE COMMERCIAL & FINANCIAL CHRONICLE

Thursday, October 5, 1944

Life Insurance Policy
Loans At New Low
Life insurance

standing
record

and

the

total

policy loans out¬

mid-year

low for

ratio

policy

j
>

the
of

reached

policy
is

loans

reserves

lowest since 1900,
Institute
of Life

past 15 years
to

the

now

according to the
Insurance.

June

30, total policy;loans had
dropped to approximately $2,100,000,000 from the peak of $3,800,000,000 reached in 1932, at- the
bottom of the

depression, and the
dropped to 6.1%
from
the
depression
high
of
21.3%, the Institute reported on
Sept. 27.
By December, it is ex¬
pected the loan total will have
loan

ratio

declined
and

had

about

$2,000,000,000

the loan ratio to 5.6%.

"By year-end the
icy

loans

total of pol¬
outstanding will have
by over a billion

reduced

been

from

dollars

the

total

record

at the outbreak of the

war," Holgar J. Johnson, President of the
Institute, said on Sept. 26. He add¬
ed

"the total of loan repay¬

that

these

ments

has

years

been

larger as the net reduction
takes
into
account
new
loans

even

This

made.

has

reduction

loan

important anti-inflation
contribution through debt reduc¬
been

the

and

gencies

the miracle of

that

strengthening

security

Policy loans relate to an impor-!
tant extent to the general tone

family financial;

and

business

helped America's great automobile in¬

the

grow

war.

and advance

it did before

"A survey

Out of the needs of

war

has

octane

coine a new con*

heels

war,

will—on the

and the period, not one of
prosperity,
culmi¬
panic of 1907. During
these years the
loan ratio in¬
creased. * * * During the recov¬
outstanding

very

boom, the ratio has been

reaching

since

1900 this year,

ness

horizons for the automobile.

index

has

consistent

Market Transactions

lightning starts.,,

In Govts. For August

and

in the

lighter,

will be

During

the

month

market transactions

developed to utilize the full power of

new

policies as col¬
has been
decrease since 1932."

loans, with

bank

swift acceleration... effortless power...

this

efficient engines that

gasoline.

sales

Yes, this is the fuel that is today hurling

investment
resulted in net
$18,992,500,
becretary

for Treasury

announced on

In Julv there were

mighty bombers and fighters across the
send

across

the

America's

cars

tabulation shows

Treasury's
transactions
in
Government securities for the last
the

Victory. This is the. fuel that will

tomorrow

Sept.

net sales

$18,484,000.
The following

August,

and other accounts

15.

skies

in direct and

guaranieed securities of the Gov¬
ernment

Morgenthau

our

new

lateral, but overall there

bring its advantages to millions upon

reached

has

Some part of the decrease
been the result of a shift to

high.

And this time the miracle of better gaso¬

millions of motorists... in

present war
steadily
a new low
as the busi¬

the

and

years

ery

Victory—produce the finer, more

powerful Flying'A Gasoline That tvill open

line will

nated in the

declining,

new

periods

years

catalytic cracking

fully engaged in producing high-

gasoline for

during

general depression and low points
during periods of relative pros¬
perity. The ratio was1 at a rela-:
tively low rate in the opening
years of this century, when the
general tone of economic welfare
was good.
There were several mi-j
nor
depressions in the ensuing

ception of petroleum's power, a great new

Tide Water Associated's

reached

been

happened twice

promise for America's peacetime automobiles.

now

of life insurance pol-;

icy loan trends since 1940 shows
that high points in the ratio of.
loans
to
reserves
have
always

That miracle has

units,

its
state:

conditions, the Institute said in
report,. The advices in part

dustry to

pro¬

grams."

constantly

powerful gasoline

better, increasingly more

people

our

meet future emer¬

insurance

their
was

resources

with which to

strengthening

It represents a

tion.

two years:—
1942—

skimming

August

September

highways of peace.

October

—

$8,440,000 sold
4,500.000 sold
1,000,800 sold
purchases

November

No sales or

December

No sales or purchases

1942—
January

February

March

—

•

Tulsa

•

May

August

sold

145.708 J00

—

sold

*7.757,2UU

June

San Francisco

sold

72.927,750

purchased
35,200.000 sold

juiy

New York

sold

90.300,000
400.000

April

TIDE WATER ASSOCIATED OIL COMPANY

$14,500,000

sole

15,800,000

sold

2,651,000 sold

September
October

FLYING-A GASOLINE

•

VEEDOL MOTOR OIL

—

sales or

$5,000,000

November

purchases
sola

4,800,000 purchased

December

1944—
January

—

February

April

BUY WAR BONDS AND

May

STAMPS

June
,

July
August

$9,924,000

sold

105,100,000 sold

11,500.000 sold
16,511,300 sold

March

9,965,000

sold

20,500,000 purchased
18,484,000 sold

18,992,500 sold

Volume

160

1485

CHRONICLE

THE COMMERCIAL & FINANCIAL

Number 4322

9X6

\N"W

-ujjtf&V*

out 0

v>X\ vvX vl v/>;y

v.- -"

2^^ViT'

...

:.wx<<~

,se,ouC^t0
gtfr1-

Steel's strength is

needed

now

for war. In thousands of

laboratories are work¬
ing day and night to find still stronger steels. Better steels.
When peace comes, you'll find these improved steels in
many peacetime products. From fences to carpet tacks.
applications. 174 United States Steel

Marked with the U*S'S
that this label is

Label

you see

here. Remember

guide to quality. Look for

it.

U M I T E

•
AMERICAN STEEL & WIRE COMPANY
CORPORATION •
COLUMBIA STEEL

AMERICAN BRIDGE COMPANY

CARNEGIE-ILLINOIS

STEEL

FEDERAL SHIPBUILDING
COMPANY • OIL WELL
SUPPLY
COMPANY
•
TENNESSEE COAL, IRON & RAILROAD
COMPANY
•
TUBULAR ALLOY STEEL CORPORATION
•
UNITED
STATES STEEL EXPORT COMPANY
•
UNITED STATES STEEL PROD¬
UCTS
COMPANY
•
UNITED
STATES STEEL SUPPLY COMPANY
UNIVERSAL ATLAS CEMENT COMPANY
• VIRGINIA BRIDGE COMPANY

COMPANY
&

DRY

•

DOCK

CYCLONE

COMPANY

FENCE
•

DIVISION

•

NATIONAL TUBE

THE COMMERCIAL & FINANCIAL CHRONICLE

1486

is based not upon free
competition but upon
an
ele¬
mental form of cooperation that is
known as collectivism. .-■■■'> f
economic, and political changes
There are students of history,
than any similar period in world
history.
It
has
produced
two economics, and philosophy, who
World Wars within a quarter of a now say that the revolution of the
future arises out of an inescapable
century and has broken the moor¬
collision between the philosophy
ings of the lives of the people in
of cooperation and of competition.
most of the countries of the earth.
point out that the basic
We have witnessed the rise of a They
human
necessity
for
national
socialistic concept of human re¬
well-being and for international
lationships, the growth of radical¬
ism everywhere, and we would peace is a highly developed pro¬
be blind indeed if we failed to gram of cooperation 4n which men
must work together, rather than
recognize this impact on our own
fight one another, and that the
national life.
competition within the private en¬
Many of our former standards
have been
overturned and old terprise system is of the same
character
as
the
competition
concepts have been uprooted. We
find it difficult to discover sure among nations, and produces the

(Continued from first page)
been going on for half a century
and has resulted in greater social

political, economic, and
philosophical thought on which to
build
these
days
of
cyclonic
anchors of

economy

conflicts.

same

I have

that

come

ence

basic

the

under that system.

must

accept the thesis
solution

our

Now

recognize the rise of a great
and powerful nation, whose entire

the

extent

operation

can

which

this

co¬

voluntary

basis with all of the freedom that
L

to what extent it must

earth, has re¬
productive ma¬

mass

chine, the potentialities of which
we
have just begun to discover.

the force and

power

compulsion by government.
Voluntary cooperation has been

the characteristic of free

men

is nowhere exemplified to a

and

higher

Who among us was so

bold

predict that the production of this
within

nation

and

two

ourselves and Allies

astounded them

of America.

and, at the same time, produced

food

national

our

life

for

has been to substitute
by laws and regula¬
freedom of vol¬
untary action.
The ultimate end
of that trend is complete regimen¬
tation under government dictate
many years

compulsion

tions in place of

with the resultant state socializa¬
tion of statism in some other form.

Let

admit

fears of

our

the

some

beginning

of these devel¬

It is no dis¬

opments and trends.

be afraid and to measure

the

danger that is upon us.. The
disgrace is in the cowardice of

refusing to fight even when the
danger is fully recognized. V
Let

has

present

several

life

and
I

we may.

fundamental

sues.

is¬

growing
Oppor¬
tunity for the individual to achieve
seems
to have been caught be¬
to

individualism.

tween two millstones.

On the

one

hand, technological developments
have moved our production sys¬
tem
away
from individual
or
small group effort into mass pro¬
duction.
The discovery and mul¬
tiplication of mechanical energy,
steam, electricity, and oil, with
the greatest horsepower per man

abundance

that

question

but

tive and

opportunity that is char¬

acteristic
we

unregulated

However

it.

much

resent the imposition

may

useful

war

bigness, by monopoly, by cartel.
Surely, such an end is not the de¬

haunting us as we plan to
energies to the service
of peace.
We have learned to do
big things in a big way. We
scarcely bat an eye when we talk
of financing in terms of billions

Designed to protect and to
safeguard the individual against

the

now

dollars.

are

proud of the
proportions of our eco¬

colossal

nomic machine.
But
cover

;

are

operations constitutes
individualism.

our

half

nesses

beginning to dis¬
that the very magnitude of
we

war.

nesmen

The first of these is the

threat

and

convert its

seen

satisfying national

little

tive machine

take their measure,

uncontrolled

feeding
our
own laws and regulations that in any
armed forces and dividing with way restrain the
complete free*
our Allies, it supplied the highest
dom of business to develop in any¬
level of civilian consumption in way it
chooses, the other choice
our history?
This giant produc¬ seems to be the envelopment by

our

such

addition

bring out into the open
and boldly examine those threats
us

There

laissez faire tends to destroy small
business and the individual initia¬

could have turned out the
overwhelming superiority of war
for

opportunity and are taking prac¬
tical steps to assist in its devel*
opment.
.■

years

that

ment

country recognize the value of a
vigorous growth of small business

that

material

However, the trend
government and the develop¬

glad that the bankers of this

..am

one-half

degree than in the United States

grace to

problems, national and interna¬
As you have, so have I, under¬ tional, there must be increasing
taken to discover a catalyst of cooperation
among
men.
With
principle in whose presence the swift transportation and instant
false would disappear and leave communication
throughout
the
truth as our beacon.
I have been world and with the interdepen¬
dence of a complex economic life,
inspired by the report of the navi¬
gator of a night flying bomber, there is increasing necessity for
who was asked how he found his men to work with one another
.way home after his compass had rather than against one another.
been destroyed and his radio beam If this is true, then we are con¬
blacked
out, when he replied: fronted with the very practical
'When all else failed, I set my problem of whether or not we can
course by the stars."
cooperate and at the same time
Our entire lives and thinking maintain a competitive society. I
have been cast in a mold of com¬ believe that we can and will, and
petitive enterprise.
All of our that the question is not one of
thinking is colored by our experi¬ conflict but is rather a question
changes.

implies,

be based

nation

any

sulted

Dangers Ahead In Banking

Thursday, October 5, 1944

million

We
small

threat
have
busi¬

disappear since we went
Many former small busihave
become employees.

Freedom of opportunity for them
has

sire of the freedom-loving and in¬

dependent people
On

the

of this

hand

other

nation.
govern*

ment.

powerful forces that would
destroy his freedom, government
now is itself becoming a monster
in size and in its control and regu¬

lation of the lives and fortunes of

individual.

every

While

appar*

ently

attempting to protect the
individual against the big and the
powerful, it is drawing him closer
under

its

to freedom

been

Out

what

embrace of death

and

the

into

control

own

become

may

opportunity.

drying up.
Finding it
difficult to survive/ they give up
and become a part of the gigantic

the early thirties, government has

machine

to find

the

that

has

destruction

pendence.

contributed

their

inde¬

There is today much

talk of

jobs and too little talk of
opportunity to go into business
for one's self.
And yet, all of us

recognize the importance of the
development
of small
business
and its place in American life.
I

through

attempted
lems
of

and

many

devices

to old prob¬

answers

new

full

desperate needs

the

discover

secrets

full employ¬
ment, and full distribution. It in*
stituted many economic and social
measures
that were designed to
relieve distress and to provide a
production,

measure

new

social

and

eco*

nomic security for large numbers
of people.
Most of these objec¬
tives

were

able

and

long

overdue.

these

and

reforms

highly desir¬
of the reforms
But along with

are

many

arose

multitude

of devices that had as their

objec¬
readjustment and
experiment.
Even here, many of
the objectives were desirable but
some
of them were visionary in
economic

tive

and basically unsound.
destroyed far more than
they created.
j

concept

iP
.0

Others
Let

</ 0V

°% J?

few of the de¬

government has used
in its economic program, that are
of particular interest to banks. J
First and foremost
of

review

that

vices

unbalanced

was

the

use

budget, spend*

than it received. • This
new discovery because
it has long been recognized that
in wartime or in a period of great
national distress, government is
justified in borrowing beyond its
income to meet the exigencies of
the demand upon it.
In the sam6
way, an individual is fully justi¬
fied in mortgaging his future in*
come
for a loan to
..ppease the
ing

was-

not

hunger of his family or to provide
medical
But

care

for

serious illness!

have had

continuous

unbalanced Federal budget for the

past fifteen years.
The first was
the result of inadequate tax col¬
lections that came from a declin-

Compressed in this
is

vast

store

one
of natural

section of our country
wealth—all the needs

of varied manufacture!
Here are the basic requirements of the chemi¬
cal and steel industries. Here are the minerals for

light metals...the mineral, agricultural and forest
sources of
plastics. Here is a plentiful supply of
water, free of impurities... intelligent, loyal,
American-horn industrial and agricultural labor.
frontier that calls urgently
ivould make the most of the expand•

In short... here is
to

those who

,ng

national income.

We then de¬

liberately increased the deficit and
spent vast sums in order to stop
the downward spiral of deflation,
t

believe

agree

that

mos

will

that under such desperate

economic

conditions

prevailed

in 1931,

1932, and 19" \ it was not
only proper but it was the duty of
Government fo throw its credit in¬

to the breach of a world-wide dei

pression and stop the deflation of
that threatened to destroy
our
entire
economy.
We then

value

ing horizons of tomorrow.
Address Development

City Southern Lines,
sas
City 6, Mo., for

started

Department, Kansas

1U W. Eleventh, Kan¬

detailed information.

the hill painfully and
slowly and there was vast un¬
employment.
We continued to
spend vast sums on made work
in a desperate effort to restore the
economy by artificial respiration;
We

___

watched

our

national

debt

climb to 30 billions of dollars and

then

^llli
tfl

gradually increase to 50 odd

billions

wonder if

dollars.
we

bottomless pit

were

We began to
not digging a

that would eventu¬

We continued to
spend more than our income but
began to question whether or
ally destroy us.

not

were

the

wrong

track

and should change our policy by

Volume

THE COMMERCIAL &

Number 4322

160

FINANCIAL CHRONICLE

groups receiving direct govern¬ wage groups throughout the world
and
is at the mercy of world
penditures.
Then came the war- ment bounties can destroy demo¬
He can have no closed
All questions of an unbalanced cratic1, self-government.
Farmers prices.
budget" and national debt became have received vast payments di¬ shop monopoly whereby he can
largely academic under the stern rectly and indirectly as an incen¬ dictate the price of the product
necessity of fully and adequately tive to production which has been he produces under a threat of
the business. He
meeting all needs of the war ef¬ necessary during the war and by closing down
against
the artificial
fort.: We adopted a program of way of artifically maintaining a struggles
heavy taxation in an effort to price that has enabled agriculture high prices of many of the in¬
dustrial products, he must have
achieve the goal of paying for
to maintain itself in our economy.
and services he must use.
Little
approximately half of the cost of
Let me say at this point that
war
and going in debt for the
wonder that he feels that injustice
although I am opposed to the prin¬ is done him when three or four
.other half.
Whatever the cost of

Increasing taxes and reducing ex¬

the
'debt

national

whatever

and

war

might require, we were
pay the taxes and assume
the liability, for the future.
,
We now see our national debt

ready to

'approaching 250 billions of dollars
'with the probability of reaching
'300 billions by the end of the war
fronted with
of

billion dollars a year

some

then be con¬
government budget

will

period.

"which includes some 6 billion
'lars

dol-

to service the debt
amortization.
On these

year

without

ciple of government bounties, my
full
ers

sympathies

are

of this country.
built up an

artificial economy

exchange

the

shortened

even

for

services he

all the

with

each

hour

the

requires.

The farmers accept

been

has

farmer

and

labor is required

labor of those whose products and

the relative trading po¬

in which

sition

with the farm¬
Too long have

of his

hours

subsidies

and

distasteful

the bounties

government but
to

most

of them.

1487

agriculture and industry and
they will continue to

society, through govern¬
ment, to make up at least a part
of that disparity.

peting private business, there

expect

may

therefore expect con¬

culture

large appropriations out
public treasury for agri¬
so long as the present dis¬

parity

between

tinuing
the

other

agriculture
of

segments

our

and

economy

proportions and may mul¬

tiply in the peace time ahead is
competition of government
direct
and
through
subsidized

the

agencies with private enterprises.
The measure of the desirability of
such

enterprises

the

value

labor is far below that of the labor

returns for their labor in the form

the subsidy of the

commerce

services
in

and industry,

he must employ.

whose

He is

competitive struggle with low

desire to receive the
handout.

government

But

until there is a fairer balance be¬
tween the returns

to the workers

public good.
Cooperative ef¬
fort is desirable for many services
and

the

ernment

drain

form

prise that has
our
as

economy.

device to

private

But when it is used
the free

secure

free

use

of gov¬

capital make a hidden
the taxpayer's funds

its

than

logical

mean

the

creates.

required.

These

debt

this

service

tered

banking has been the

the device of government
teed loans.

For

recognized

war

that

fear

(Continued

on page

this

score

but the fear

have is the attitude of large

I do

numbers

people that we can
this debt many
and accept continu¬

continue to pile on

billions

ing peace time deficits as a nor¬
mal 1 procedure
in governmental
finance.
In spite of the spending
'of vast sums in the peace time

effort to create arti¬
high level of national
income and the failure of receiv¬
ing the results hoped for, there
•are
many, who
now advocate a
in

'years

ficially

continuing
scale,

program

larger
"v:

The

of debts comes
of the production oi
more of that pro-

payment
out

largely

wealth and the

for debt

that is required

.duction

THEIR

PLACE

OUR

POSTWAR

PLANS

service, the less there will be for

maintaining standards of living
The thing that I am afraid of is
the

Fighting Hydrocarbons

philosophy and economics of

those who maintain that the con¬
tinuous ballooning

battle

of national debt

time is a proper and desirable way in which to maintain
our
national economy.
The idle
in peace

•

talk

men

the size of
debt is of

consequence

them for after the war?

Our postwar

of some

confidence

the

and

plan is to keep them plenty busy —

here's how:

that it will be paid.

; one

The

that

reason

raise vast
is

hydrogen and carbon —what are we going

red

that

cause

simple ele¬

internal government

an
no

those tiny, two-fisted,

to use

obscures the basic
fact that all debt is possible be¬

herring

—

winning combinations of the

ments

places thai

high

sums

are

.able tc

for the war effort

but is be¬

only patriotism

not

people of this natioi
in the integrity of oui

the

cause

believe

and

government

productive

our

capacity to take care of these ob¬

Credit

ligations.

based uoor
well as

Codimer and

character and integrity as

;

•

some

will

people

the

economy,

hold

ther

into 100-octane aviation fuel to¬

day. Pure Oil has five plants mak¬

of obligation's of

mine to

Another
used by

the

been

device

and

loans

that

has

been

recent years has
of public funds di¬

use

indirectly

and

rectly

ing these.

butylene from big new plants in Texas.
Butylene will keep on going into

bombs—is

and

4 •

Pure Oil supplies a lot of

rubber and into many

plastics whose
■

use

of the new

has been so

greatly expanded.

Pure Oil

plants. They'll be used

to turn out

for

well

produced in special
products of petroleum

high-quality gasoline,
as

for

lacquers,

dyes, and plastics.

paints,

Commercial airlines

private planes will demand

high-octane fuel in peacetime.
And car motors will develop on
the

high compression side.

Oil will be ready

Pure

with the finest

stepped-up motor fuels.

disastrous

government in increasing

proportions
i

Butylene—for synthetic rubber•

Toluene—That makes TNT for

is prevented.

program
i

that such

see

the octane

rating of gasoline. They're going

300 billions of dollars

government anc
will expect and demand that pol¬
icies and programs be directed te
the end of servicing and paying
i the
debt instead of enlarging it
If they should once get the idea
that the peace time pattern of
government finances is to con¬
tinue a program of deficit financ¬
ing, we need not be surprised to
i see the beginning of a loss of con¬
fidence.
It will be your job and

Alkylate—hydro¬

carbons that step up

ability to pay.
Once the natior
is back on the track of peace time

so-called

for

These

plants Pure Oil has built to make
jobs, new life in days to come.

fighting hydrocarbons and the

them, will mean new

things, new

gifts,

benefits

segments of our people.
astonishingly large proportion

various
An
'
.

people today have their
public treasury. The
responsible for much of
this whVh rr,ust be accepted as
of

the

hands in the
war

part of the cost of the war.

How¬

it helps make the pattern
there will be much
difficulty in extricating ourselves
after the war.
Large pressure

ever,

from

which

I i

purposes,

losses

constitute part of the cost of war

I have

maintaining government.

and that such should be socialized

upon

take
of

will

and

use

guaran¬

credit

of the necessary expenses

care

devel¬

opment in the field of credit that,
is of particular concern to char¬

figures
and will

can

would

destruction of competi¬

themselves.

tive private enterprise.
A comparatively recent

not alarming

are

Carried

conclusion,

15%
probable national income will

use

funds to compete with
capital, it destroys far

figures, it means that about
of

enter¬

valuable place in

of public
more

to large

can

question of wherein lies

A fourth device that has grown

general welfare of the people
but where such projects through

be little

com¬

the

private

continues.

They have

and

payments

that advantage to under¬

use

sell and put out of business

price
support, the exchange value of his
government

and

commerce,

Y, U. S. A.

1488)

THE COMMERCIAL" & FINANCIAL' CHRONICLE

1488

Thursday, October 5, 1944

not

that

Dangers Ahead In
(Continued from
the

socialization

such
has

losses

credit

1487)

of the taxpayer.

expense

However,

page

place

permanent peace time credit struc¬
ture.
We are already confronted
with numerous proposals to carry
over the principle of the guaran¬
teed loans into the post-reconver¬
sion

government credit
competition.
If

kind

that

lic interest.

permitted, we could
point out numerous other policies
and programs of government that
apparently were designed for the
common good, but in effect have

represented the substitution of the
mandates of government through
laws and regulations, in place of

period, making it a perma¬
nent part of our credit system.
Borrowers have been intrigued
with the ease with which they

erative effort;

could> obtain such credits and of

the low cost to them. Lenders have

tween freedom of action and gov¬

moderate return upon a

ernment dictate.
There must of
necessity be a certain amount of

enjoyed

practically riskless o p e r a t i o n.
There are some who see Only im¬
mediate benefits

(and fail to rec¬
ognize that this type of credit op¬
eration involves a socialization of
conclusion

logical

to 'its

carried

and

losses

credit

will

destroy

The

socialization

business

far

socialized

than

credit

home

small farmers. It means,

owners or

in effect, the

financing of incom¬

petent men ■ and impossible busi¬
ness operations that will compete
with well
their
It

run

own

businesses that pay

including

way,

taxes.

financing for busi¬
that have all to gain and

means

nesses

easy

nothing to lose and permits a type
of
competition that,
in
many
cases, a soundly run business can¬
not meet. The one competitor that
a

well

business cannot stand

run

against is the business that does
not make ends met and takes its
losses

out

of its creditors.

It is

unthinkable that tax paying busi¬
ness

called

this

br
>

find

the

time,

same

banking is

of the most

highly developed
segments of our national life in
its voluntary cooperation in the
interest of the public good.
Al¬
though banks are highly competi¬
one

tive with each other in their ef¬

forts to

loans,

secure

and

business, to make

perform

banking

services, they have demonstrated

before this nation
balance be¬

proper

but

the other hand, such gov¬
control

ernment

maximum of

leave

freedom for volun¬

cooperative effort.

Perhaps
strated

of. our
demon¬

segment
has

American

ance

should

economy

completely the fine bal¬

between government

tion and

regula¬

private constructive

com¬

petitive effort with resultant ben¬
efit and service

people

to the American

does the chartered bank¬

ing system. The banks are super¬
vised and regulated by state and
federal
have

tection

agencies under laws that
their obj ective the pro¬
of

the

public.

There

evidence of the fullest cooperation
of banks with government in such

regulation and supervision.

Al¬
though at times it is felt that some
regulations or laws are unneces¬
sarily restrictive, on the whole,
the

chartered banks accept the
supervision of government as be¬
ing a proper governmental fUnc-

degree of cooperation with each
the needs of the
American people that is unex¬
other in serving

celled

our

American

needed in

the

war

ef¬

antee of the adequacy of bank

checking services, small
loans, trust services, savings ac¬
counts, and in many other ways.
Banking policies everywhere are
directed toward performing the

requirements that
post-war economy may re¬
quire.
It gives assurance of a
continuing
adequate supply of

viding

most,

useful

services

and

most

valuable

the American people.

Banking demonstrates the capac¬
ity of an important segment of our
private enterprise system to co¬
operate voluntarily within its own
field and with all

the

business

other fields in

performance of services that

resources
ume

to meet almost any vol¬

credit

our

credit

and will be a highly sta¬
bilizing force in the reconversion
period and after,
r
•
>
Banking's resources of men of

competence and vision are unsur¬
passed in the history of banking,.
A

high degree of expertness in

management characterizes the
tire

The cumula¬
tive results of the educational ac¬

are constantly exploring new
techniques to improve the effici¬
ency of what is already recognized

they

and

does

cooperate voluntarily ers a better
understanding of the
public interest. At the technique of banking, as well as
same time, banks vigorously com¬
the proper function of banks in
as one of the most efficient sys¬
pete with one another and with serving the economy of the na¬
tems for performing valuable ser¬
resultant benefits to the public.
tion.
Supervisory authorities, na¬
vices at minimum costs to the
In looking ahead to post-war tional and State, recognize and
public that has yet been devised
needs, let us examine the capacity acclaim the high quality of bank
by man.
When it is recognized of our chartered
banking system management today,
The recent
that hundreds of millions of checks
to meet those needs.
4
" j report of the Comptroller of the
on banks throughout the country
relating
to
national
In money and other financial Currency,
are constantly transferring funds
banks, is fairly representative of
from and to every town, city vil¬ resources, the banking system has
reached the largest volume in his¬ supervisory opinion when he said
lage in the nation quickly and
that the banks under his super¬
tory.
In the past twelve years,
economically and so efficiently
these resources have multiplied vision are well managed; I quote
that the public scarcely realizes
from his report;
nearly four-fold. Approximately,
the size of the job that is being
l
The ability and competence of
three-fourths of all banking assets
performed' every day, there is consist of
the officers and directors of the
government bonds arid
abundant evidence of a high de¬
cash.
banks under the supervision of
The. remainder is in assets
gree of cooperation. ;
^
of a high quality. A large part of
this office, have shown a steady
Banking cooperates not only increase
in
bank
improvement in the last few
deposits has
within itself but with every other
been created through deficit fi¬
years.
Those who are respon¬
segment of our economy.
It co¬ nancing and borrowing by the
sible for the management and
operates wi th business in serving Federal Government.
The total
policies of small banks, as well
and performing multiple financial volume
as large, of the country institu¬
of
bank
deposits will
services. Banking is closely iden¬ likely continue near or above the
tions as well as those in the city,
tified with agriculture and recog¬
exhibit the satisfying compre¬
present high level for many years
nizes a community of interest be¬ to come.
There exists today no
hension of the techniques and
tween the two.
It serves every inflated.volume of private credit
principles of banking, both as
need of agricultural credit and to be liquidated and there is little
they apply to the operation of
bankers are in the forefront of prospect for any substantial re¬
their own institutions and as
duction in the present total of
every effort to promote the in¬
they relate to the entire bank¬
terest of farmers.
Banking co¬ government debt
in
the
near
ing and business field.
operates with government and the future. On the other hand, it will
The machinery of the banking,
history of that cooperation during likely go higher.
All of the fac¬ system has proved its adequacy
the war period is a fine evidence tors that enter into the creation and effectiveness under all the
that business and government can of bank deposits or their liquida¬ strains
imposed upon it by war¬
cooperate in the public interest. tion indicate a continuing volume time economy and by the new
In spite of all of its own problems of bank deposits not far from the and increased demands made upon
and difficulties during the war present high level. The inevitable it for many war-time services.
period, banking has willingly ac¬ shifting of deposits between banks There will be a continuing need
in the post-war adjustment period
for legislative and administrative
cepted every request made by
and in the

will

create

problems for individ¬

(Continued

,
.

Thoughtful planning and saving

now

better world when victory comes

which

peace

measure

may

all hope to find

world in which

a way

we may

will bring
a

world in

toward lasting

all share

some

of prosperity.

SEND FOR FREE BOOKLET

International Shoe Co.
/Looking Ahead

Visit THE. HOME BUYERS EXHIBITION
At the main office of

THE DIME SAVINGS BANK OF BROOKLYN
'The Bank That Serves The Home Owner'

FULTON STREET AND DeKALB AVENUE

BROOKLYN 1, NEW YORK

MEMBER

FEDERAL

DEPOSIT

en¬

banking system,

system.

government to utilize its services

»1,1

us a

coop¬

♦'

should

to subsidize through

upon

.,4-. \

■

country

were

fort. Banking identifies itself with
the needs of the individual in pro-:

are
positively and definitely in tivities of the American
Institute
Through national and the public good. Truly, banking
of
Banking and the Graduate
state organizations, banks are con¬
demonstrates, that private com¬ School of
regulation by government, rules
Banking, together, with
of fair play and protection in the tinuously seeking new ways in petitive enterprise under reason¬
numerous study conferences have
which to perform greater service,
interest of the' common; Welfare,
able government regulation can
given tens of thousands of bank¬

dangerous

of voluntary

The question

tary

private credit.

tion and administered in the pub¬

time

the freedoms

ual institutions but will not dimin¬

ish the deposits and resources of
the banking system as a whole,
This situation constitutes a guar¬

only in performing ordinary
banking services but in carrying
on many new war time activities

INSURANCE

CORPORATION

ST. LOUIS, MO.

on page

1491)

Volume 160

Number 4322

FINANCIAL CHRONICLE

THE COMMERCIAL

•••

•i

Will I

■• ••

Important

see

Yes, immediately in the city in
or

radio

relay networks link

rushed to your

■

while they

events

news

I4S'>

which the

Will I

newsreels will be
held for

•

and radio?
tested

hundreds of the great names of the entertainment world have been

Yes. In the past 3 years,
for Television.

local Television station by swift planes and will be shown at once or

famous stars of stage, screen

see

transpires. And distant events — when cable

news event

large cities. Until such time, motion picture

up our

regular newscast periods.

■

happening?

are

Every week brings

faces to DuMont's Station WABD, anxious to explore the

new

thrilling possibilities of this great new medium.
••

■*.

vy.y.:

•

••

:•

Will I get

•'

"local
in

•

Television Set?

on my

for fast eye-and-ear coverage of everything

Yes, indeed, DuMont has designed "pickup trucks"
that goes on

*».

••

pictures"

news

•

community. As portable video cameras scan the parade passing 5th and Main,

your

You'll watch for your friends in style shows and
and other contests, inspections of
crops, gardens, and new- construction. You'll visit dedications, patriotic and political rallies,
county fairs, fires and accidents. You'll take wonderful shopping tours — without leaving your

it will appear on your DuMont home receiver.

amateur

productions, graduations, street interviews, quizzes

favorite armchair.

Yvyv.y..; y.y y.

■

.'*••'

*".V\

....

•'

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Yes, national advertisers are

yy.

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"T.

free?

Will I get big sporting events

/|.

v y >

,y..

v,y yyy; y

Madison

already seeking options for telecasting the World Series,

football classics, etc. Because several Television cameras
employed, you'll enjoy several "best seats" at each event.
.
. y4
.
,
■' y" .J.:;/'V:

Square Garden attractions, the races,
will be

vw.

v«

Television will make education as

engineers will take

".V •'

•

'..'."V*:'* '•

•

>»

will Television offer?

exciting

as a mystery

adventure. Well-known scientists and

of great industries, mines and utilities; will entertain us in their /
enjoy conducted tours of art galleries, planetariums, museums, zoos,

us on tours

We shall

laboratories.

•'

y.y;y.y,->:V:-'-;:'"-.'y,. "T :y.

'v'•

What educational programs

•' '

.'A-Y'•'!'".*•;; ^:

•

•"*

Congress, political conventions, town
automobile and aviation shows, hospital clinics, kitchens of

aquariums, historic sites and national parks. We shall sit in
hall

meetings and courts. We'll visit

famous chefs, model farms and

\V:

•

..-Ov

V;;

'•

•••.."

•

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*
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•. ••

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lecture halls.
V :-'.v

tl' f'T-'V;
"H

Will I have to look at

over

y.y

•••

Ju V '.

••"j•--y:->

.»

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\\
7;

will mix

Station WABD, DuMont has

Don't expect

days to

war

them

soon.

spare

color transmission is still in the

for

high among the truly enter¬
pleasant ones.

you — very

—

including DuMont's — are giving their >

time to the development of natural color telecasting.

Truthfully,

laboratory stage.

Will I get standard radio
Not unless you own a

.• .■

full color?

Engineers in many laboratories

work and their

;-y. y.-.:

lot of entertainment with very little sales talk. For some

taining features of Television. They have many surprises in store

Will I receive pictures in

•

V,...'

cooperated with national advertisers in developing tech¬

niques for putting product demonstrations and advertising messages

7»

I '*•

V.-

•/ \z. "v*i

parade of advertised products?

Television's commercial sponsors
time

•:

-V y

programs on my

Television Set?

combination Television-Radio Receiver. A separate unit is required.

new-model DuMont Television-Radio Receivers

Several

will provide Television, standard AM and FM

(Frequency-Modulation) reception and an excellent phonograph record player. DuMont's impres¬
sive

pioneering achievement in Television assures you of the very finest in electronic

and cabinet

artistry

...

engineering

of unique performance in your peacetime Television Set.
■v

MONT

LABORATORIES, INC., GENERAL

STUDIOS

AND

STATION

WABD,

OFFICES
515

AND

PLANT,

MADISON AVENUE,

MAIN AVENUE,
NEW YORK

PASSAIC, N. J,

22, NEW

YORK,

*31

THE COMMERCIAL & FINANCIAL CHRONICLE

149a

Thursday,: October 5, 1944

Post-War "Banking
(Continued from page 1462)
its
many
perils —among
others the pirates who threatened
it in the days of the Hanseatic
League, the royal repudiations of
the
Sixteenth and Seventeenth
vived

Centuries, the first impact of the
business cycle which came with
the Industrial Revolution,, and in

of Wild¬
cat days and depreciated paper
currencies which followed the de¬
struction of the Second Bank of
the United States1.
This history of
survival through all the vicissi¬
this country the terrors

tudes from infancy

to present ma¬

suggests that banking . in¬
stitutions
are
essential to; our

turity

find,
to
which

its

war

It is assumed that

effort.

rationing and

control will

price

desired

-to

make

it would take

war

was,

began, took
tion

banker's

trusteeship
in the

isfactory.
But the exigencies of
war
financing have greatly in¬

ed with very, delicate questions
growing out of this general situa¬

field is pre-empted will determine
the future of private banking in

tion.

the American scene.

banks

government

have done yeoman

tection.

of this

ment of banks

reappraise the re¬
lationship of their capital to de¬
posits with a view towards the

goods which can not be im¬

The Secre¬

mediately produced.

changed

tary of the Treasury has expressed
his confidence in the good sense

confront

sooii

which

ters, but the supervisory authori¬
ties

well

the banks

them¬

certain to be confront¬

are

We should be

this matter.

has been in¬

mit that with the advent of peace
it is desirable that the manage¬

prevent a general cashing in of
these securities to storm a market
for

All

evitable, and so recognized by all
supervisory authorities. Yet I sub¬

the interest of the country, to use

everywhere

deposits without a com¬
capital pro¬

mensurate increase in

promoting the sale of war
bonds to individuals, but it. now
devolves upon them, in their own
interest and more importantly in
influence

of government
government
guaranteed

creased

service

their

composed

bonds,

giving thought

all, there remains fthe
question of just what role the
United States will
play in the post-war iyorld. They
are in splended condition to meet

issue which is fundamental. If
have

are

covered.

which

The extent to which this

Important

banks of these

world

post-war

should be diligently explored and

In conclusion, may I' be per¬
of mitted to quote once more a few
general sentences written by one of pur

■

Finally, and most

coming

broad: field

classic

economists

great

many

It seems to compress
great deal of wisdom into a very

years

few

ago.

The; author

words.

John

Stuart Mill, and he said:

society of free

"History shows that great

eco¬

enterprise and personal initiative,

nomic and social forces flow like

of individualism in the American

tradition,

conscious

need a

Ranking

sys¬
tem alive to its responsibilities for
providing credit for industry and

tide

over

falling
foresee

communities only half
that which is be¬

them.

Wise

statesmen

what time is thus bring¬

agriculture, and determined to do ing, and try to shape institutions
such a good job that? it will re¬ and mold men's
thought in ac¬
quire an ever diminishing amount cordance with the change that is
of support from either Federal or silently coming on.
The unwise
State
authorities.
The
proper are those Who bring nothing con¬
function of banking if hot the en¬ structive to the process,, and who
joyment of
in

comfortable security

the form

of income from gov¬

ernment

obligations arid govern¬
ment guaranteed paper, but rather
the hard and often difficult busi¬
ness

the

making loanSy supplying

necessary

credit of the

greatly imperil the future of man¬
kind by leaving great questions
to be fought out between ignorant
change on one hand, and ignorant
opposition
to
change
on
the
other."

com¬

We are today experiencing a
munity and exerting leadership in great acceleration in these eco¬
an
independent and | competitive" nomic and social forces which, as

-s'.V

economy.

Mr.

I; trust I shall not be misunder¬
stood here. I

certafnly not sug¬

gesting that the
country should

banjkers of this

Mill

"flow like

says,

tide

communities which are only
half conscious of that which is be¬

over

We must hold fast
good. We must also adjust
of the entrepreneur land go into, thought and action to the present
the business of providing venture extremity and to the prospect of
capital, I am not inviting any ex¬ that world which, not without
ment of credit extended to re¬ tension of credit which can not be promise, lies beyond the horizon
among ourselves is that of bank
capitalization.
Generally speak¬ turning veterans. We are not yet justified by proper banking stand¬ of war.
■■V'"k?
yy '

but be¬

be thrust

upon,

When

material.

lies .a

bonds,

now

some>'

war

came

ready, willing and able to
serve
our
coup try,
not only with manufacturing
facilities, but with the all important "Know How,"
These things have meant much to ■pur loved ones
serving on every battle front.
>■'
Minneapolis-Moline

these mat¬

.at the impressive total of
47
billion
dollars.
The

holdings

educational orders for the produc¬

ordnance

But short of such a reckless

abuse

there

selves

all out war effort
to
win.
Minneapolis-Moline, therefore, started
before 1938 to design a farm tractor that eould be
converted to serve as a Military Vehicle.—This MM
Tractor on maneuvers at Camp; Ripley (1940) was
the first Military Vehicle called Jeep—Since then
MM Jeeps have served Allied Countries as well
as
our own—and MM Jeeps have served and are
now
serving oil some of the toughest battlefields
of this war. In addition MM, long before hostilities
us,

Bureau

ards.

regulations

paper and cash.
Their risk assets
are few.
Their earnings are sat¬

material

war

realized that should

Veterans'

the

individual investor does with his

Long before our country was at war Minneapolisprepared for that possible eventuality, not

cause

to be laid down by the

are

largely

Moline

because

with

which

tor, almost a determining one,
will be the Question of what the

conditions which Will
them, conditions
hope will move them
cope with the
problems
of the American people in this vigorously into an expanded com¬
now confront them. It is our duty,
mercial loaning field.
Certainly
of course, to help them do this, regard. The Secretary feels that
with good earnings, high liquidity
and I should like to take advan-; people generally have been taught
and large available funds in the
to save and. that they are not go¬
tage of my early position on the
ing to be so quick to spend after hands of the general public there
program of this conference to lay
May I ask that was. never a more opportune time
before you for thought and dis¬ the war is over.
to
approach investors with the
cussion some of the matters which, the weight of your influence be
used to support this hope and ex¬ idea of increasing their commit¬
in my judgment, will be of inter¬
ments in bank stocks.
est
and concern to banks ^nd pectation, and thus to prevent the
Thirdly, there is developing for
banking during the impending fostering of black markets and
the further unnecessary absorp¬ banks a
conversion period.
It is possible
problem in public rela¬
tion of government securities by tions
that
through the exchange of
growing out of the return of
There is, of course, an millions, of service men who are
ideas we may be able to-develop the banks.
a program which will be of
as¬ impressive back log of purchasing anxious to re-establish themselves
power in these 47 billion dollars in business and in agriculture.
sistance during: this trying time,
A
of individual savings which may
great debt is owed these men by
It is generally agreed that one
be of significant service in the fu¬
society. The Federal Government
of the main
difficulties in the
ture.
Our immediate concern is has
recognized the impelling na¬
transition of our economy from
that this back log—a guarantee of ture of it
by passing legislation
war to peace will be the necessity
future ultimate consuming power
designed to assist them in their
of holding within proper limits
and employment^—be -not used un¬ endeavors to
pick up the threads
the demand for consumers' dur¬
til
reconversion
has
supplied of their lives, where they were
able goods until these goods can
goods to- buy.:y
ke- dropped. Some of this legislation
be turned out in volume by our
The second problem which, it provides: for a partial assumption
industrial plant reconverted from
occurs
to me we might discuss of risk by the Federal Govern¬

that they will

and

world,

by trial and error, the means

familiar

play their parts in the months ing, banks today are in very
Their assets are
ahead, but a very important fac¬ strong position.

was

the

assume

role

falling them,"

to the

excellence in quality and high production. ... The
U. S. Army Ordnance Banner awarded to both the
Power Machinery Plant, Hopkins, Minnesota, and
the- Automotive Plant in

Minneapolis, Minnesota, for
production of many items for the U. S.
Army. MM plants have been awarded. Safety * Pen¬
nants
for a well organized Safety Plan in each
factory, and MMV safety record speaks for itself.
Minneapolis-Molilie was one of first 109 large firms
iii' the U. S. whose eniplovees invested 10% or more
in War Bonds, on the Payroll Deduction Plan.
meritorious

Important, too, is the fact that Minneapolis-Moline
continued to produce its complete line of
modern farm machinery, farm and industrial trac¬
tors and engines as allowed by government limita¬
has

for

and

orders

tion

obtained.
A

year

ago

post

war

period

:0y.yVf-:
Wartime

Sales

and'

held aiuF plans laid; for

was
.

could

materials

;'■

complete

Production Conference
the

which

1.y;-_■

these

plans

are

now

Minneapolis-Moline, we believe, was the first and
may lie the only company in, the United States to
have earned all the following production awards:
The Victory Fleet Flag and U. S. Maritime "M"
Pennant (now with 4 gold stairs for continued meri¬
torious production—Automotive Plant, Minneapolis)
The Army-Navy "E" (Como Special Ordnance
Plant, Minneapolis);now with 2 stars for continued
...

practically complete and, when Victory has been
ground out, MM will be prepared for Peace. In
the meantime, our
and

war

production; record lias been,

believe will continue

be,

particularly to the nearly 1,400
who have left

and

men

inspiration

and

women

employ to join the Armed Forces,
all Americans who realize what these awards

stand for.

our

■

taken*

Photo

Marshall: Islands

taking
and

Truk.

bomb,

Jeep

oil to
in

Si rice

oner'

the

just before

bomb-

Saipan

NOTE. 1.0(10

lb.

background' — MM

foreground.

t he

Original

Jeep, Minneapolis-Moline'
'

has

designed several, ad¬

ditional
tary

tion with

officials.
Personal

credit

for

nammtr

tb«

.!«<>«

goes

to James T. O'Brien of the 100th Ordnance

Co.,
here

Minnesota

National

uuards,

s«io.vn

at Camp Ripley,
Minnesota, during the 1040 maneuvers. „
driving

the

Jeep

developed from the 4
wheel drive Jeep, serving m our country
and the United Nations in many strategic
MM

places,

wheel

Jeep,

'G-4'

Universal

Harvester

combine wheat

'V'

make

tractor
an

and

ideal

team

most' any crop anywhere.

Universal *V'

'Hi-Klearance' plow
stubble.

tractor with

turning over soy bean
•

■

models

tractors

Mili¬

coopera¬

Army and Navy
1

THE COMMERCIAL & FINANCIAL CHRONICLE

Number 4322

Volume 160

ciples

that

among the
we are

must be employed
nations of the earth if

to have any hope of world

peace.
The international flow of
lages, the towns, and the cities goods, services, money and credits
this
broad
land.
The
sponsibilities that go along with across
is indispensable to a stable world¬
that leadership;
The country de¬ banker is a leader in that com¬ wide
economy.
We/will be con¬
that the dual banking system, the mands men of clear vision, who munity life. He contributes to its fronted- with many vexing prob¬
the
dangers
that tone and to its quality. He helps lems of new
operation of institutions under recognize
machinery of coop¬
State and Federal authority, is threaten us and have the courage develop and promote community eration in the manifold fields in
peculiarly suited to the dynamic to rise above the littleness of enterprise, he participates in the which nations must work to¬
and changing needs of the people prejudice, the greed of self-in¬ social, the cultural, and the re¬
gether.
We may at times find a
of this nation. Results of the past terest, and will boldly .lead the ligious life of the people about conflict between immediate selffew years give abundant evidence way in landing
answers to the him. What a rare opportunity for interest and
long range welfare.
hot only of constructive coopera¬ needs of the American people. genuine service to his fellowman;
We will find conflicts between
tion between Federal and State They are demanding a satisfying what a life of satisfying accom¬
our heads and our hearts, between
authorities but of the inherent national economy in which we plishment may be his. The fu¬
our desire for profit and our im¬
value of a banking system that is will harness the vast potentials of ture of America will not be de¬
pulse of generosity. Let us recog¬
flexible and that is not dominated our productive system to make termined by decisions made or
nize that world cooperation does
by a single governmental agency. the plenty that is possible and policies adopted on Pennsylvania
not require the dissipation of our
The kind of banking system that then to make that plenty avail¬ Avenue in Washington but it will
resources to the four winds. There
this country does not need is a able to all who can and would see spring from the hearts of men, the
must be protection of our national
so-called
streamlined,
unified, it.
common man who works in the
interest while, at the same time,
In our efforts to serve in broad
Federalized, single system that
field, at the office, or in the shop.
we share with the nations of the
operates under tne sole jurisdic¬ fields, we as bankers should not The association of the banker with
tion of any one individual bureau neglect the most fruitful results these men in his own community earth in working out the common
or agency.
Such a system would of leadership in serving the com¬ —the worker, the home owner, problems of preserving civiliza¬
tion and seeking the mutual un¬
mean
that
the
banks
would munity life where we live.
the small business man—is his
If you would discover the soul
derstanding and cooperation upon
quickly lose their close local touch
rare
opportunity for friendship,
which is dependent, the peace ot
and would fail to respond to the of America, that priceless spirit
for leadership, and for service.
the world.
varied
and
changing needs of which sets the quality of our liv¬
In a practical way, let Us seek
The same principles of cooper¬
lbcal business, agriculture, and ing and yields the satisfaction of
The world
industry,
Such a system would the worthwhile," you will find it ation in a competitive society, and give cooperation.
easily lend itself to the designs of in the community life of the vil¬ within our own country are prin¬ needs us and we need the friend-

for leadership as well us the re¬

(Continued from page 1488)

Chicago Stock Exch,

adjustment of banking machinery.
But there is abundant evidence

Three New Members Of
Rollm

Andrews

Minne¬

apolis, Minnesota, Vice-President
of J. M. Dain & Co.; James J. Mc-

N.ulty of Chicago, Vice-President
of Ames, Emerich & Co., Inc.; and
Philip Plesofsky of Chicago, part¬
ner of Irving E. Meyerhoff & Co.,
were

elected to

Chicago
of

Board

membership in the
Stock Exchange by the
Governors, it was an¬

nounced.

With the election of Mr.

Andrews

membership,

Dain & Co. becomes the fifteenth

registered member corporation of
Exchange.

the

transferred

The
Mr.

membership

McNulty

was

previously held by the late Mar¬
shall Forrest, formerly

Executive

Vice-President of Ames,
& Co.,

Emerich

Inc.

cooperation,

ship,
of

all

nations.

need the
and

ization of banking.

the purpose of

An inventory of

the

post-war needs of the American
people reveals new heights in

planning a nation-wide program
enlarged service.

its

approached

own

Banking has
problem of

private

meeting the threat against

enterprise by taking .positive and
definite action to enlarge its. serv¬
ice

and

American agriculture

business and to meet the

needs of

the public generally.
The prompt
organization of a Post-War Small

and
banker support
for its program and objective is
one of the
most heartening an¬
swers that has been given to the
question of whether or not pri¬
vate enterprise is able and willing
to meet the demands of the post¬
war.
The bankers of this country
are determined to serve fully and
adequately the credit needs of
Business

Credit Commission

widespread

the

competent individual, firm,
that performs a

every

corporation

useful service.
'

We have

immediate task

adequate sup¬
ply of credit that will be needed
ibr the termination of .war pro¬

the provision of an

T/mS&r

Many small businesses
needed little

duction.

that heretofore have
if

credit will be confronted
necessity of securing

any

with

adequate termination loans.
is our first and immediate

and

This

to earth.

task

production is curtailed, and
banking will meet it.

as war

One lesson that all of us

is that

With lumber and its by-products

vital to the Allied cause, "timber" is

war-cry

in Oregon.

Far-sighted pioneers realized the poten¬
Oregon's magnificent forests,
verdant valleys and salmon-filled waters.
tial value of

with increasing political control of
our economic life, public relations
have

important

most

become, a

These abundant natural

element in the conduct of our af¬

We should keep

fairs.

before
that

democratic

our

life and

the settlers
.

encour¬

"k Oregon is
rood.

A
>.

to discover it.

are

our

economy

1344'
11

★

Given

★

■

★

one

of the 11

western states served

Subsequent advertisements of this

by the Union Pacific Rail-

series will feature other states,

Sunday afternoon. Consult your local newspaper for time andstation.
<

THE

PROGRESSIVE

UNION PACIFIC

MONTANA

Service in the pub¬
[Pa Ho

railroad

Doming

Every segment of

prevail.

the American

opportunity for all.

beginning

now

lic interest is the basic policy that
must

serve

NEBRASKA

is being weighed in

the balance of its value to society.

That which truly serves
vive and that which is

fish
will

will sur¬
purely sel¬

and

against the public good
be destroyed.

As individual

have before

us a

bankers,

now

great opportunity

and pre¬
doctrine of equal
war

1SG3

approval.
Banking and business
hjave long ago found this out and
groups

all-out effort to win the

Listen to uYOUR AMERICA'', Mutual coast-to coast network every

other

Today Oregon and

welded together in

developed Oregon—"built the Union
in peace-time, trainloads of

manipulation of shrewd opera¬
tors in government or in business
can succeed, long in any plans or
programs that do not meet public

are

Pacific—built your America,

economy

national

nation-wide markets.

Today,

govern¬

that is to
prevail in this country, The sov¬
ereign people are the final .arbi¬
ters of

which unites the Pacific Northwest with

aged personal initiative.

incentive that spurred

to labor from dawn to dusk

ultimately the will of the
people prevails. The people will
determine not only the kind of
banking system we will have but
kind

th,©

were

ment,

the

over

"strategic middle route"

incentive, Americans have
always been willing to work for future
security, It's, that enterprising spirit that

constantly

the realistic recognition

under

resources

Oregon products roll eastward
Union Pacific

Union Pacific

should

have learned well by now

There's the warning shout "timber"
a giant of the
Oregon forests crashes

•

the

COLORADO
KANSAS

Kourt

good-will
all, they

blessings of the freedoms

ours.

within government
who might desire to utilize the
banking resources for social or
political objectives and it would
become a ripe plum for those who
might desire the complete social¬

banking and its dedication to

opportunities that have long

been

groups

any

and

Most

THE COMMERCIAL & FINANCIAL CHRONICLE

1492

ratio

Bank
(Continued from page 1458)
obligations certain non1

either through the is¬

of fiat

suance

eminent

marketable

Investments

measures,

devaluatoin

drastic

further

w-couoon-bearing

through

money

development the dollar. Such a measure'would
lead
to
financial
would not merely materially de¬ undoubtedly
chaos.
crease the liquidity of the banks
but would also reduce their earn¬
While each individual bank has
ings and might lead to a whole¬ its own investment problems the
sale
liquidation
of institutions, prime problem that confronts the
large as well as small,
v / ?
banking System as a whole is that
the public debt be handled along
The establishment of the 100%
reserve
system under which all sound economic lines. A debt of
Government obligations held by 300 billion dollars can be carried
securities.

Such

their by the United States particularly
loans would be transferred to a if production in the post-war pe¬
riod is maintained at a high level
governmental agency would also
and the national income is large.
not merely deprive the banks of
a
considerable portion of their The banks as well as every citi¬
zen interested in the future wel¬
earnings but would make banking
in the United States a football for fare of the country must realize
that the only way to solve the
politics. What is even worse is:
the banks and even some of

debt is
the hard way,
the rather widespread belief that public
the only way to solve the debt namely, through the institution of
problem is through inflationary economy on the part of the Gov-

economic and financial disaster.
the

end

000

June

30, 1941. This sharp
conclusively that
the banks always reflect the eco¬
on

increase
nomic

proves

financial

and

the country.
of

the

Since

national

gaged in

position of
large portion
is

economy

en¬

work it is only

war

na¬

tural that the assets of the banks

should reflect this situation.

that banking today is rather sim¬

ple,

banker merely has
deposits

that the

to take in his customers'

them in Government
bonds. But banking, and particu¬
larly the investment phase there¬
of, is not so simple as that.
A
well managed bank must stand
ready to meet the demands of its
customers at any time and hence
place

intrusted to it must be

bank

can

that

manner

a
so

without the

of incurring a loss from
the liquidation of some of its as¬
sets.

A bank must also handle its

portfolio in such
will

tomers.

very sub¬

able
for

that it
legitimate

a manner

meet

its

credit from

cus¬

problems

the

con¬

The problems of the individual
banks may be analyzed under the

following headings; (1) liquidity
to meet the possible withdrawal of
deposits and the heeds of tneir
customers; (2) the need for earn¬

Liquidity:

prescribe how

impossible

individual bank

shall handle its portfolio and
par¬

ticularly its
tions

Government

order

obliga¬
a
high,"

achieve

degree of liquidity combined with

satisfactory
there

earnings.
'certain

are

principles
less

which

However,

fundamental

apply

commercial

every

bank.

Briefly stated,
these principles
be summarized as follows;

may

(1)

The

investment

policy

each bank should be based

of
the

composition of its deposits.
It is:
quite evident that a bank operat¬

ing primarily with demand de¬
posits belonging to relatively fewcustomers will need greater liq¬
uidity than an institution oper¬
ating primarily with savings de¬
posits belonging to many thou¬
.

(3) the tax problem; (4)
prevention of loss caused by
change in interest rates; (5) the

ings;
the
a

handling' of securities other than
the

handling

obligations; and (6)
of mortgages and

real estate.
The investment

problems which

confront the entire banking sytem
will arise out of: (1) the refund¬

operations

ing

will

which

the need to

(2)

the

sands

(2)

depositors.

Each bank, in

adopting its

investment policy, should consider
the composition of its assets other
than

Government

obligations.

considerable portion of the as¬
sets consists of mortgages or other
a

Treasury, long, term obligations, it is quite-

large indeed,
Govern¬

very

absorb

evident

that

should

such

endeavor

institution

have

shorter.

ment securities which will be sold

Government

by corporations and individuals in
the immediate
post-war period.

other

(3) Most important of all will be
agitation to relieve the debt

than Government obligations and
have
no
mortgages
at all and

the

burden

the

nation

the

ex¬

of the banks. (4) Other im¬
plications will arise out of the
fact that not only the assets of
the banks rest largely on Govern¬
ment credit but also that deposits

pense

individuals

are

insured

It must guard against de¬

$5,000 by a governmental agency
and that most of the mortgages
ent this is even more important held
by financial institutions are
than perhaps ever before since the insured by the FHA.

preciation of its portfolio. At pres¬

PHILADELPHIA "

BOSTON

demands

PRIVATE BANKERS
NEW YORK

fronting individual banks and (b)
those
confronting the
banking
system as a whole.
,•

Government

On the surface it would appear

and

(a)

namely,

1944 the
holding of Government securities
by the commercial banks of the
country amounted to $63,200,000,000 as compared with $20,095,000,May

danger

Co.

de¬

materially

stantial part of the total earning
political subdivi¬ assets of the banks.
sions, through an increase in the
The investment problems that
production of the country and confront the banks are numerous
through an adequate tax system. and complicated and divide them¬
Any other measures will lead to selves into two distant phases,

the

resources

decreased

ernment and its

the funds

Brown Brothers Harriman

capital

has

and investments form

employed in such

Btisiness Established ISIS

posits

Thursday, October 5, 1944

maturities.

hand,

have

only

the

institutions

which
securities other-

few

whose loans

are

the whole sat¬

isfactory can afford to own a
larger proportion of long term
Government obligations.
(3)

Each* bank

should

con¬

sider the fact that the end of the
war

witness

may

crisscross
from

considerable
of deposits

movement

section of the country to

one

another.

While it is fairly certain

that the total volume of bank de¬

posits is bound to increase in the
Statement

of Condition, September 30, 1944

immediate post-war
■

tions of the country, notably those
which
had
benefited
materially

ASSETS
Cash

Hand and Due from Banks.

United States Government Securities

Loans and Discounts

Customers'

5,190,490.48

Acceptances

With

28,361,322.71

Eye

the

4L555,914.91
5,137,845.27

Interests

457,205.28

of Banks

Deposits—Demand

Deposits—Time

Acceptances

'J -v.;-

Capital

Expenses,
Contingencies

........

Surplus

DOuniquelyKNOW thattowe are
YOU qualified
serve

162,585.73

banks

2,000,000.00

Deposits

are

Pledged

many

and
PARTNERS
Moreau D. Brown

FACILITIES

E. R. Harriman

Complete Facilities

for

;

•

Domestic

Deposit Accounts* Loans

and

•

Acceptances

■

J".

Louis Curtis

•••.

Brokers

for
of

Knight Wooliey

Purchase

and

such

Since the

Securities

types

of securities

Department stands ready

organizations.

Sale

ing it,

test

anything lies in try¬

we suggest

that

you

what

Stephen Y. Hord

Alister C. Colquhoun

Howard P. Maeder

our

Institutional Bond

ment

Managers
*Charles W. Eliason, Jr.

Charles F. Breed

can

do for you.

Thomas McCance

Depart¬

Merritt T. Cooke

William F. Ray

J. McElrath

♦Edwin K. Merrill

Arthur R. Rowe

William A. Hess

Herbert M chlert \

Joseph R. Kenny

Arthur K. Paddock

F. H. Kingsbury, Jr.
-

■■

Joseph C. Lucey

;

fjfj

L. Parks Shipley

♦Eugene W.

Stetson, Jr.

GaleWillard
Harry L. WttLS

Merrill Lynch, Pierce,
Underwriters and Distributors

Paul, Comptroller

Arthur B. Smith, A uditor
*Now in Government Service.

Licersed

as Private Bankers arid subject tn examination and regulation by the '
Superintendent of Banks of the State of NewYork and by the Department of
Banking of the Commonwealth of Pennsylvania. Subject to supervision and ex¬
amination by the Commissioner of Banks of the Commonwealthof Massachusetts.

fka

70 PINE

STREET

Fenner & Beane

oj Investment Securities

Brokers in Securities and
Georce E.

short term

Since

sections

for Government obli¬

the market

gations.

However,

that

sume

one

these

even

as¬

may

institutions

primarily short term
obligations at least
initial stages.
Above all,

prefer

the

in
no

bank

allow

should

itself

position where it has to
readjust its cash position through
the sale of long term Government
a

obligations. Not that
of a material

there is a
decline in
prices of long term Government
obligations, but it is sound bank¬
ing practice that deposits which
may be withdrawn in the fore¬
seeable future be covered by short
term
Government obligations or
danger

short

The
to

ratio

deposits

assets.

term
of

capital

resources

will

also exercise an
influence on the liquidity position
of
the
bank.
Naturally
banks

deposits
have increased
sharply during the past few :
years and whose ratio of capital
resources to deposits has decreased
materially will endeavor to hold
a
larger portion of short term
Government
obligations.
How-'
very-

♦John C. West

Thomas

among *

"froth,"

whose

♦Donald K. Walker

Assistant Managers
David G. Ackicuman

covered by

period,

"foam".»or

deposits the banks in theseundoubtedly will be in

gain

ascertain

Ernest E. Nelson"

*H. Pelham Curtis

bank expects to lose

referred

de¬

certain sections of the country will

other

Investment Advisory Service

H. D. Pennington, Genera! Manager

Edward Abrams

facilities and

supply prompt, efficient coopera¬

tion

Commercial Letters of Credit
Ray Morris

Those

follows.

Government

markets; in particular, our Institu¬

tional Bond

Foreign Banking

Prescott S. Bush

posits that

will

Required by Law.

knowledge of all

Thatcher M. Brown *W. A. Harriman

-phases of their

We offer nationwide

Secure

other institutions

all

security market activities?

$176,766,919.49

Public

and

dealing with

13,585,801.91

11,585,801.91

U. S. Government Securities Par Value $/00,000

Government obligations.

1,500,000.00

...

will

somewhat

should

......

etc.

investment pol¬
the above consid¬
handle its portfolio

;

bank whose

bankers

5,208,355.59

305,426.99

Accrued Interest,
Reserve for

commonly

5,513,782.58

Less Held in Portfolio,

well as the financial centers of the country, may gain de¬
posits.

goods,

in the immediate post-war

4,612,348.14 $156,310,176.26

consumers'

non-durable

$151,697,828.12
,

well

erations

and other

effort, will lose de¬

the centers

icy is based

$176,766,919.49
LIABILITIES

war

Other sections, particularly
producing durable as

posits.

62,990,324.47

..........

Liability

Other Assets

from the

$ 33,073,616.37

State, Municipal and Other Public Securities
Other Marketable Securities

period yet it

is equally certain that certain sec¬

Commodities
NEW YORK 5, N. Y.

Offices in 85 Cities

ever,

when

sufficient

coming

institution holds

amount

due

one

obligations

year

may

curtail its holdings of two to three
year obligations and increase its
holdings of longer maturities, thus

increasing

impairing
Without

its earnings
its 1 liquidity.

saying that

without

It^goes '

bank

oper¬

ating primarily with time deposits
can

well

afford

.to

hold

large

Volume

THE COMMERCIAL, & FINANCIAL CHRONICLE

.Number 4322

160

thermore, one may take it for
granted that while taxes will be
lower in the post-war period than
at the present time they will be
substantially higher than in the
period.
Furthermore,
interest rates which, as will be pre-war
since the volume of partially taxpointed out later, is not antici¬
pated in the foreseeable future. exempt Government obligations is
While banks operating with sav¬ being reduced at a rapid rate, it
is
highly doubtful whether the
ings deposits can well afford to
be
almost entirely
invested in Congress will make any changes
long term Government obligations in taxes which would have an ad¬
they too should not overlook the verse effect on the exemption

percentage of its Government obli¬
gations in the longest maturities,
Government
obligations carry
no
credit risk.
The only danger
that can arise is from a change in

for

demand

potential

mortgage

from the normal tax.

arise in the post¬

Fluctuations caused by changes

period and naturally should
make the proper arrangements.

in interest rates: Since the amount

loans that will
war

of Government securities held by

By following the few principles the banks is very large, it is quite
outlined above, a bank will be in clear that any increase in interest
rates accompanied by a decline in
a position to meet all contingen¬
cies that may arise in the future prices of Government obligations
and will also have adequate earn¬ could have a highly adverse effect
on the position of the banks.
The
ings. However, just as it is not
advisable
in

entirely

invested

long term obligations it is un¬

amount

ment

hold

necessary

excessive

an
term

of ' short

Govern¬

obligations.

Taxable

partially

versus

tax-

securities: The question
whether to buy taxable or par¬

exempt

trend of interest rates

can

ana¬

(1) from
the point of view of the Treasury
and (2) from .the angle of supply
and demand.
The dependence of
the Treasury on the money mar¬
ket in the immediate post-war pe¬
riod will be great indeed.
Not
only will the Treasury be con¬
lyzed from two angles:

until the treasuries of these coun¬

crease

tries have completed

pected

their refund¬
ing operations and have become
entirely independent of the money
market. One may go even a step
farther and say that an increase

can

in interest rates can be ex¬

lowing considerations:

(1) What

is the tax situation of the institu¬

tion

and what will it be
during
the next two or three
years? (2) Is the bank in a posi¬
tion to pay the substantial pre¬
mium which the present outstand¬
ing partially tax-exempt Govern¬

obligations command? Ob¬
viously a bank whose ratio of
capital to deposits has witnessed
a
sharp decrease in recent years
will not be willing to invest a
considerable portion of its capital
in the premium which the medium
and
long
term
partially
taxexempt
Government obligations
command
at
the
present time.
Finally in considering the ques¬
tion of partially tax-exempts ver¬
sus taxable securities, it should al¬
ways be borne in mind that taxa¬
tion should not be the primary
consideration

investment

policy but. other, factors such .-as
liquidity and the potential de¬
mands that may be made on a
bank should receive equal atten¬
tion. While a reduction in taxes,
.

artd

notably of the

excess

profits

the

from today.

years

The demand and supply factors:

demand

for

American

However, a much sounder ap¬
proach in analyzing the trend of ply of commodities that foreigners
adverse effect on banks politically interest-rates is not from the angle could sell to the United States.
as well as economically.
A ma¬ of the needs of the Treasury and (4) Almost all. mortgages and a
terial
increase
in
money
rates its influence on the money market large number of bonds outstanding
but rather from a study of the at the present time carry amor¬
would
be
accompanied
by a
decline
in; prices
of
Gov¬ demand and supply factors. On tization provisions, thus implying
ernment
bonds,
thus
causing the. supply side this will be the a constant repayment of principal.
some
institutions substantial de¬ situation: (1) The volume of de¬ (J5) Pension schemes and the large
preciation. Furthermore, what is posits will be very large and will volume of life insurance sold dur¬
of much greater importance is the witness a further increase. Hence ing tne last few years will create
fact that an increase in interest industry and trade, broadly
speak- large sums which will seek in¬
rates would undoubtedly strength¬ ing
will have sufficient liquid vestment in high grade securities.
en" the hands of those who will funds at their disposal to meet Finally
(6) if business activity
advocate a relief of the debt bur¬ the conversion and the necessary after the conversion period is at
den at the expense of the banks. expansion.
(2) There is bound to a high level, as is generally ex¬
Viewed, therefore, from the stand¬ be. a return flow of currency from pected, the savings of the peo¬
point of the needs of the Treas¬ circulation which will not only ple ought to be substantial.
ury and the position of the banks increase deposits but also create
On the demand
side there is
in

money

themselves,
conclusion

rates

one

that

have

would

reach

may
no

in¬

serve

amount

corresponding

the

material

balances.

considerable

re¬

There

(3)

divergence of views

(Continued

on page

1494)

THE

be eliminated with the end of hos¬

tilities.
The
ways

needs

exercise

the

Treasury al¬

great influence

the policies adopted by

tary authorities.
such

countries
Canada

the

the mone¬
number of

England

and

PHILADELPHIA
BANK

NATIONAL

as in this country,
has been expressed
authorities that it will

well

opinion

by
be

In
as

high
the

iii

tent/

policy of their respective
to maintain money

SfiejiiiJy/l'ania

governments
rates

will

low level.

the

certainly

interest

the

Treasury to utilize all means at
its disposal to prevent an increase
in

the

annual

debt

burden.

The

of the monetary authori¬

powers

ties over the money market are
great and since at the end of the
the

Statement

people

at large will be
primarily in a reduc-r
tion in taxes one 'may expect that
they will support the Congress as
well as any administration that
may be in power to prevent money
rates from going up and which
war

of Condition, September 30, 1944

interested

would

further

increase

the

It is

RESOURCES

Cash and due from Banks

\r A A.

$168,560,185.87

fixed

expenditures of the Government.

U. S. Government Securities

454,780,178.41

the

opinion of this writer
war
period'yet; the fact should that the monetary authorities in
not' be overlodkM that the excess this country, Great Britain or in
profits tax may nOt'!be entirely' Canada will not permit any ma¬
eliminated for several years. Fur¬ terial increase in interest rates

tabb^ is quite likely in the post¬

;;

State, County

and Municipal Securities /

Other Securities

•

Loans and Discounts

•

Buildings

87,973,299.91
.

111,002,843.46
28,803,065.89

•

Liability Account of Acceptances

Customers'

Bank

•

Accrued Interest Receivable

2,501,904.04

1,794,720.90
;

7 1.00

1755,416,199 48

LIABILITIES

Capital Stock
Surplus

;

' i

Our

Afford-

Reserve

; ',

Undivided Profits \
Extensive Connections

..:

$ 14,000,000.00

•

28,000,000.00

9,421,463.72

for Taxes

3,625,055.21

Dividend

Correspondents Broader Service,

(Payable October 2, 1944)

875,000.00

Unearned Discount and Accrued Interest

151,665.29

Acceptances

♦

2,616,431.77

Deposits
United States
All Other

Member Federal

Established 1858

Deposit Insurance Corporation

Deposits

605,580,185.92

696,726,583.49

$755,416,199.48

Bank

and Trust Company
PHILADELPHIA
.

$ 91,146,397.57

Treasury

Corn Exchange

National

prod¬

ucts will be exceedingly great and
will undoubtedly exceed the sup¬

Government will not

today

ment

possibility that the end of LendLease may witness a return flow'
of gold to the United States since

far as the human mind
foresee, which is four orfive
so

tially
tax-exempt
Government
fronted with the task of refunding
obligations is one which can be
billions of
dollars
of
maturing
answered only by the individual
obligations but also the deficit of
bank and will depend on the fol¬
the Federal

1493

Philadelphia, Pa.

Men;Her of the Federal Deposit Insurance Corporation

THE COMMERCIAL & FINANCIAL CHRONICLE

1494

Thursday, October

the

economy of the country has
been reconverted and the supply

)

civilian

demand for

what the

will

credit

obligation

bank

only

corporate

fraction

per cent higher than that of
Government obligation of the

one

be.

However, unless
the war witnesses a

ment
a

policy which can be based
fair degree of liquidity com¬

bined

with

the

(4)

must make every,

expenditures

satisfactory earnings.

Refunding

equal to the
The, Government

tilities.

Treasury:

While

effort to reduce

the

end

hos¬

balanced

cannot be achieved

1944

necessity
high.

are

Hence it would not be
surpris¬

ing if

measures

gested

were

solve

the

debt

sug¬
burden

through unorthodox measures, such
(1) Inflation, which is a sharp

budget

as:

fast

taxes

bound to remain

goods Is

demand.

If the return of

turn.

(Continued from page 1493)
even among Government agencies

tained,

rise in

was

commodity prices, accom¬
same maturity,
of
then there is lit¬ One of the first problems that will the case at the end of the last
panied as it would be by a much
sharp increase in commodity tle advantage in holding such a confront the banks as a whole in war, yet in view of the
huge pub¬ higher ' national income in terms
prices, which is not anticipated, security. The fact should not be the immediate post-war period lic debt outstanding and the
large of dollars. However, such a solu¬
the demand for bank credit will overlooked that Government se¬ will be to assist the
Treasury in amount of debt service, it is ab¬ tion would be dishonest and in
be only "moderate. There will be curities enjoy certain advantages
carrying out its huge refunding solutely essential that the budget the long run would
spell eco¬
a moderate demand for capital for even over the highest grade bonds.
program;
At the end of the war of the.; Federal Government be nomic and
political-disaster.
It
the purpose of acquiring plants In the first place there is abso¬ the short term
floating debt of the balanced as soon as possible and would rob the
people of their
erected and owned by the Govern¬ lutely no credit risk attached to United States will be
very large. efforts made to gradually retire liquid
savings. It would wipe out
Secondly, in periods of Furthermore, since series
ment., Undoubtedly there will be them.
E, F and the public debt. It would be ad¬ the middle class. It would under¬
stress they are protected by the
a substantial demand for mortgage
G bonds are for all practical pur¬ visable now to devise a
system to mine confidence in Government
market operations of the poses
money. States and municipalities open
demand
obligations
the handle the maturing E, F, and G and in its institutions and
hence
will also sell considerable amounts Federal Reserve banks.
Treasury must stand ready to bonds when they mature. Some of would have far
reaching economic
Banks
still
hold
a
certain
of
securities
to
finance
public
r*eet any demand that may arise these obligations will come due and
political consequences.
Sucjh
works neglected during the war. amount of credit bonds. No gen¬ from this source. It is also
quite next year and it would be helpful a solution, while it
may seem
On the whole, however, the de¬ eralization can be made about this certain
that corporations which if the public had some
conception painless at the beginning, inevit¬
mand cannot be so great, particu¬ type of security.
Each should be have accumulated a large amount as to how the
Treasury intends ably leads to disaster as the ex¬
the

end

very

larly if war contracts are prompt¬

investigated

ly settled and the price level does
not witness a sharp increase after

rately. Where the outlook for the
industry and for the debtor cor¬

hostilities.

poration is good and where the
yield on the bond is satisfactory
there is no reason why such a se¬

the

end

Hence

one

conclude that in

may

the foreseeable future

material

analyzed

and

sepa¬

short

Government

term

will

gations

convert

obli¬

them

cash in order to finance their
conversion.

to handle maturing
All

re¬

•'VV.;'> *v

These facts must be recognized

by the banks and plans should be
rates is to be curity should be sold.
On the made by them in conjunction with
expected. Banks which hold me¬ other hand, obligations of corpora¬ the Treasury to handle the re¬
dium or long term Government tions with a doubtful future and
funding operations in a manner
securities based on a sound pol¬ which may encounter considerable which would
be satisfactory to
icy, therefore, need not fear any difficulties in thq post-war period the Treasury and at the same time
substantial losses from the depre¬ should be liquidated.
not decrease the liquidity of the
increase in

ciation of

the

ualize

under

contrary,

circumstances

securities.

one

can

Well

not

vis¬

are

investment

for

The banks

money

rates

lower than

may

they

«•,.

1 y.

'V. >»•

■.

-FIRST CHOICE
for

Short Term Investments
consolidated

of the Federal

debentures

intermediate credit hanks offer

short-term investments for both hanks and

These debentures

are

the

every

made

outstanding advantages

corporations.

sued in maturities of from six

twelve months.

are

They

funds

New York and other

Issued under the Federal Farm Loan
debentures

and

are

eligible

the

volume

re¬

banks

Government
them

reserve

ought to enable the

commer¬

public funds held under the authority
approved

exchange for the
obligations held by

As compensation the
authorities or the Govern¬

now.

would
of the country to ab¬ ment
obligate
itself
to
portion of the short term maintain these obligations con¬
obligations now held as reserve stantly at par. (c) To institute the

sorb

surplus by business

Relieving

the

debt

concerns,

the expense of the banks: As

was

pointed out at the beginning, the
public debt of the United States
the

end

amount to

lars;

hostilities

about 300

may

billion

At present rates

100%
save

burden

dol¬

of interest

reserve

the

ment

banks,

remain limited.

Hence

effort should therefore be
even

after the

the people-to
Government

war

to induce

hold and buy more

bonds, at least until

are

period

war

billion

may range

from 18 to

these

circumstances, and particularly if
a

balanced

an •

address

CHARLES R. DUNN, Fiscal

budget

before

UNION SECURITIES

UNDERWRITERS AND

Geoffrey Crowther stated

at¬

CORPORATION

DISTRIBUTORS

Investment Securities

Agent
■

New York 5, N. Y.

THE FEDERAL INTERMEDIATE CREDIT BANKS
louisville, ky.

st. paul, minn.

baltimore, md.

new orleans, la.

omaha, neb.

columbia, s. c.

st". louis, mo.

wichita, kan.

65 BROADWAY,

NEW YORK

houston, tex.
berkeley, cal.

BOSTON

♦

BUFFALO

'••

•

SYRACUSE

■'

spokane, wash.

HARTFORD

•

fol¬

"It might be possible to ;pro~

dealers^

the

Society, Mr.

lows:

31 Nassau Street

made

Manchester Statistical

dollars., Under

offered through recognized security dealers and dealer
to

thus

Govern¬

standing obligations held by the
banks
through
fiat
money
or
through the profit that 'Can be
realized 1 through a sharp •depre¬

control of

Inquiries should be addressed to the Fiscal Agent or

springfield, mass.

and

all

obligations owned by the
(d) To redeem the out¬

banks.

are

security for

deposit of postal savings funds.

Debentures

system

interest

amended, the

security for all fiduciary, trust

the Federal Government and are
the

low-interest-bearing securities

expected,

states.

Act,

interest

obligations
(b).To issue special

is¬

legal investments for savings banks, insurance companies
trust

flow

the

Government

joint' and several obligations of

the twelve Federal intermediate credit banks and

and

return

save

na¬

Reserve

cial banks

the floating debt of the Treas¬

bound

The

material

thus

(a) To

Federal

Hence for many years to
ciation of the dollar in terms' of
the debt burden alone will amount
come the floating debt of the Fed¬
gold.:
-v. •-"
•: ■■■;.'■
to about 6 billion dollars per an¬
eral Government is bound to be
All these measures invariably
num.
If debt retirement of 2 to
very large and the Jaanks in all
would have far reaching adverse
3 billion dollars is included one
likelihood
will ,he,thevl largest
effects on the national economy
may expect that the handling of
holders of this floatirtg debt.
(3)
of the country and the cure would
the public debt alone may absorb
Every effort should be made to
be
by far worse than the ills
each year 8 to 9 billion dollars of
distribute Government securities
which it was intended to remedy.
the taxpayers' money. In addition
among
others than commercial
Finally, in England the sugges¬
the total expenditures of the Gov¬
banks. It is evident that for some
tion has already been made by the
time after the war the supply of ernment, exclusive of the public
editor of the "London Economist"
debt, will be substantially larger
money in the hands of the people
than was the case before the war. that the income derived by the
is bound to be great and the sup¬
In fact one may expect that the banks from the holding of Gov¬
ply of certain types of commodi¬
ernment
securities
should
be
minimum
expenditures
of
the
ties available for consumption is
Federal Government in the post¬ turned over to the Government,

held by them.

war

the

turn

ury.

follows,

banks and

serve
balances
of
the
member
banks should increase, and this in

whole must stand

today.

the

be fractionally

are

tionalize

the

institutions

situation where long term

achieved

of currency from circulation is to

operating with sav¬ ready to assist the Government in
ings deposits. Real estate, on the the refunding operations. (2) The
other
hand, however good and refunding must be gradual in or¬
Other than Government obliga¬ profitable, is not a satisfactory der not to impair the liquidity of
tions: AAA corporate securities bank asset and present real estate the banks.
Under conditions as
conditions make the liquidation
naturally are a proper field for
they exist today and will con¬
bank investments. In considering of such assets highly desirable.
tinue for a number of years after
In conclusion one may say that the war the liquidity of the banks
the relationship between Govern¬
ments and AAA corporate securi¬ the individual bank today is in a as well as of the money market
ties the only question is the re- position to adopt a sound invest- will rest to a very large extent
a

should

obligations which the cor¬
porations may offer for sale or
redemption. Since at the end of

mortgages banks. The following recommen¬
by the FHA or dations suggest themselves;
(1)

sound

problems

to absorb the short term Govern¬

amortized

certain whether insured

even

these

ment

money

Government

obligations.

perience of other countries has
be. conclusively proven.
(2) A second way of lightening
considered now. Above all, plans
should be made by. the banking the debt burden is at the expense
the
banks
which
can
be
system as a whole to stand ready of

into

PHILADELPHIA a.

Volume

that

vide

THE COMMERCIAL & FINANCIAL CHRONICLE

Number 4322

160

all,

But this would involve

Full text of Commercial and Financial Chronicle : October 5, 1944, Vol. 160, No. 4322, Section 1

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