Full text of Commercial and Financial Chronicle : September 14, 1950, Vol. 172, No. 4942

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

UNIVERSITY
OF MICHIGAN

ESTABLISHED 1S39

SEP 15 1950

Tk a

BUSINESS AIMINISTftAllON
LIBRARY

j

an

Financial

Chronicle

Reg. U. S. Pat. Office

Volume

172

Number

4942

New

York, N. Y., Thursday, September 14, 1950

Price 30 Cents

Copy

a

EDITORIAL

Our Fiscal Resources

As We See It
The

law.

Defense

Production

Act

of

For the

1950

is

over

Former Under

thereunder, and has taken pains to explain

Asserting

the radio the Administration's view of what

to

the

meet

likely

difficulties

the

and

contingencies

certain to be encountered. Some of the
President's generalizations are straight to the
or

point, and

be taken without reservation

can

plain statements of the facts
as

frank assertions

American

people to meet

When the

as

they stand and

Chief

Executive, for example, says
"will require
longer hours for everybody"
we
gladly and earnestly approve his position. He
is on strong ground when he observes that "to
of taxes

finance

we

borrowed

enough.
effort

much

too

an

enormous

We must not

did

run

not

calls

to

our

tax administrators and tax

and

increase

[We

books

the

defense

effort

is

faulty.]

Continued

on

page

STANY

Royal Bank of Scotland

49

taxes

lot

ways

more

to

a

increase

the

of the

tax

was

television, household appliances,
sugar, nylons, domestics, and goods

production in every way; and, in par¬
ticular, to remove any roadblocks to

production.

if this

war

is

selves

and

not

to

Paul

On the other hand,
paid for by our¬

by

children,

our

heavier

tax

loads

than

now

•An

by Mr. Magill before the National
Pittsburgh, Pa., Sept. 11, 1950.

26

Tax

Continued

OUTING

PICTURES

IN

THIS

page

this wave of scare
buying is probably past its peak.
The shortages in goods expected by

Consumer

have not

demands

in

been

bad

as

lines

many

as

have

undoubtedly been saturated.
Scare buying and hoard¬
ing has been somewhat discouraged by generally un¬

our

favorable

public attitudes.

The outlook for retail sales

Association,

on

Nystrom

anticipated.

they have been bearing in

address

H.

As of today, it seems

that

consumers

be

best producers, individual and
corporate, must bear much

•An

for the

remainder

address

by Dr. Nystrom before the National Shoe
Association, New York City, Sept. 7, 1950.

36

Continued

on

of this
Retailers

page

28

ISSUE—Pictures

Security Traders Association of New

York

on

taken at the Annual Outing
Sept. 8 at the New York Athletic

24.

State and

Funds,

Charing Cross, S. W. 1

Burlington Gardens, W. 1
64 New Bond Street,

W. 1

Municipal

Custodian

Franklin

OFFICES:

West Smith field, E. C. 1

600 Branches

inc.

A Mutual Fund

across

TOTAL

ASSETS

Monthly Commercial Letter
upon request

UTILITIES FUND

£ 156,628,838

INCOME

Glyn,

Mills

& Co.

Deacon's

Williams

THE NATIONAL CITY BANK

The

(BALANCED) FUND

Prospectus

Associated Banks:

on

64 Wall Street, New

York 5

Bond

Commence
Head

Dept. Teletype: NY 1-708

hives tors

irust

Distributors of

Municipal

Prospectus from authorised dealers

or

OTIS & CO.
Established

BOSTON

Angeles




Public Service Co.
COMMON

issues

-

SOLD

-

Goodbody

&

Co.

ESTABLISHED 1891

1899

MEMBERS

NEW

Chicago

Cincinnati

Columbus

Denver
Toledo

Dommioh Securities
Grporatioti

Dallas
Buffalo

Members New
and other

Exchange Place, New York 5, N.Y,

111

YORK

CHICAGO

Teletype NY 1-702-3

WHitehaU 4-8161

request

Boston

Y^ork Stock Exchange

Principal Exchanges

Broadway, N. Y. 6

105 W. ADAMS ST.

WOrth 4-6000
NEW

upon

IRA HAUPT&CO.

YORK STOCK EXCH.

40
115 BROADWAY

New York

Analysis

QUOTED

CLEVELAND
Chicago

Los

BOUGHT

(Incorporated)

Devonshire Street

New York

Central Vermont

and

Corporate Securities

'VANCK. SANDERS & CO.

BONDS & STOCKS
internal

OF NEW YORK

Los Angeles

CANADIAN

and

THE CITY

Exchange PL

Portland, Ore. San Francisco

Canada

of

Underwriters

NATIONAL BANK
OF

Government

Department

THE CHASE

Office: Toronto

New York Agency: 20
Seattle

'Massachusetts

Bond

Canadian Bank

OF NEW YORK

request

FRANKLIN DISTRIBUTORS, Inc.

Bank, Ltd.

Bonds

Canada

COMMON STOCK FUND
PREFERRED STOCK FUND
BOND FUND

Ill

1950,

need to encourage full

Club appear on pages 21, 22, 23 and

Bishopsgate, E. C. 2

'

25,
followed by a great surge
of
scare
buying
that
continued
through both July and August.
The
buying was particularly heavy in
certain lines, such as autos, tires,

In

probable

full

to

seem

the first six months of the year.
The Korean outbreak on June

made of wool.

we

shoes

an

Therefore,

Roswell Magill

Retail

exception.
They ap¬
parently held their own throughout

that

money.

been

throughout Scotland

LONDON

8

merchandise.

OFFICE—Edinburgh

Branches

3

new

Prior to the Korean out¬

boom

full speed, since, in the last an¬
alysis, the United States wins wars
by out-producing the other fellow.

Incorporated by Royal Charter 1727
HEAD

produce

some

sales

have

at

inevitably

This

a

cannot

would emerge if the financing of

consequences

was

we must try to reconcile two
propositions not easily reconciled.
We know the economy must function

that these

means

well-known history.

there

burden,

to spend, and there

that the President

We

find

to

devising

present defense

relatively fewer things for them to buy.

assume

now

in some lines, such as
housing, automobiles, television, refrigerators and other
appliances, but almost a depression
in the sales of apparel and general

also

and

men,

specialists.

effort.

will

supply of civilian goods will not keep pace
with the growth in civilian incomes. In short,
will be

young

The Retail Outlook

sales in this country since the first of the year

merely pro¬
pose to jack up rates 50% or 100%,
nor will it be enough to look in the

the

more money

are

Our task involves
none of
the perils that face our sons, the soldiers; but
nevertheless it is one that requires our best thought

Few, we imagine, would wish to take serious
exception to the general statement that "the de¬
fense program means that more men and women
will be at work, at
good pay. At the same time,

people will have

able-bodied

arms

that kind of financial basis."

on

I.
Retail

break

War

we
ourselves

tax

of administrative

stantial tax increases.

During World War II
and

Warns

excess

defense effort out

our

will avoid

now, we

in the national debt.

first skirmish.

in

profits tax and says it should be
used only to discourage profiteering. Concludes, if Con¬
gress holds
down non-essential civilian expenditures,
contemplated military outlays can be met without sub¬

that to meet the demands of the
day
harder work and

the extent that

must obtain maximum production at less

we

Columbia University

Though stating outlook for reiail sales for remainder of
year is good, Dr. Nystrom warns in.lation threat is seri¬
ous.
Sees danger from over-issues of government money
and expanded credit greater than from goods shortages.
Suggests as business program: (1) holding down of
prices; (2) tightening of consumer credit; (3) cut in
government civilian spending; (4) fair and wide in¬
creases in taxes;
(5) no increase in minimum wages;
(6) more productivity and less loafing on job; and (7)
more public interest in sound
political policies.

Secretary of the Treasury

order

difficulties of

critical situation.

a

in

ammunition

as

to what is needed from the

as

Professor of Marketing,

to increase our fiscal resources, former
Treasury official advocates "trimming the fat off current
Federal budget." Contends, because of probable future
heavy military outlays, we should not exhaust our tax

cost

lies ahead. We have been told what must be done

1

By PAUL H. NYSTROM*

Emergency

By ROSWELL MAGILL*

now

The President has issued certain executive

orders

The Business Outlook

Teletype NY 1-2708

Telephone: Enterprise 1820

Financial Chronicle

The Commercial and
2

.

..

Thursday, September 14, 1950

(986)

The

MARKETS IN

TRADING

Security I Like Best

Puget Sound Power & Light

A continuous forum in

Federal Water & Gas, Stubs

in the investment

Central Public Utility

participate and give their reasons

5^/52

Eastern Utilities Associates

(The articles contained in this

(Conv.)

nor

1920

FRIEDRICHS

of

(Central Louisiana Electric
My favorite securities are
which appear to

afford

Co.)
those

combina¬

a

tion of the following factors:

a

(3) a
good
probability of

Rights & Scrip

to

PONNELL & CO.
Members

York Stock Exchange

Exchange

bin

t i

a

factors.

Stock

This

operating

Consider H. Willett

tric

Common

company

service

incorporated

17

to

villages and 50 unin¬

and

towns

corporated communities which
form a neatly intergrated system
in the heart of Central Louisiana.

CO.

Water service is furnished to four

Incorporated

Kentucky Home Life Bldg.

LOUISVILLE 2, KENTUCKY

communities, ice plants are oper¬
ated in two and a profitable dairy
business

Bell Tele. LS 186

Long Distance 238-9

small
utility
renders elec¬

relatively

is

Alex¬

in

operated

andria, La. Ninety per cent of the

operating

company's
however,

come

revenues,

from the

electric
territory

business.
The
served is a rapidly growing diver¬
sified industrial, residential and
utility

U. S. THERMO

agricultural section.
The company's financial struc¬

CONTROL

particularly sound. All of
with the ex¬

ture is

the outstanding debt

Analysis

on

Request

Notes, were

Electrification

Rural

U. S.

of 2%

$479,500

of

ception

recently refunded into $5,500,000
First
Mortgage 3%
Bonds due
7-1-80.
Total Debt is approxi¬

★ i

★

★

there

since

of

59%

mately

are

Net

Plant,

and

Debentures or

no

Preferred Stock outstanding, there
remains

148 State St., Boston 9, Mass.
Tel.
V

CA.

7-0425

:

:

Teletype BS 259

N. Y. Telephone WOrth 4-5000

r

Central Vermont Pub. Serv.
Eastern

Kansas

Utilities

Spring Brook Water

Toledo Edison Common

41%

a

Stock

Common

to

the com¬
pany purchased from others sub¬
stantially all of its electricity.
With the completion in that year
of a thoroughly modern outdoor
plant, however, its generating ca¬
pacity became more than suffcient
to serve its needs.
Incidentally
Prior

July,

1948

plan is located close to five

natural gas
supply, and therefore combines
low fuel cost, with the last word
in
gas-steam generating equip¬
ment to produce very low cost

separate

sources

of

VOGELL & CO., Inc.
37 Wall Street, New

York 5

WHitehall 4-2530 Teletype NY 1-3568

have

1948 to $3.90 per share in
($3.61 per share after giv¬

the sale of 9,888
Aug. 16, 1950). Dividends

effect

been

increased

$1.60

from

share paid 1946-49 to $1.80
per share rate at present.
On the basis of the current level
of better

this produces

than 5^4% on

a

return
elec¬

an

tric operating utility common

with

41% equity. A return that rep¬
resents only 50% of earnings.
In addition to the stability re¬
a

S/mskan &(o.
MEMBERS

NEW YORK STOCK EXCHANGE
NEW YORK CURS EXCHANGE

the nature of the
business and the substantial Com¬
sulting
mon

from

equity, and the good return,

this situation also appears to

probabilities

for

good

Phone

ment in value in the future.

Teletype NY 1-953




offer

enhance¬

40 EXCHANGE PL., NEW YORK 5, N. Y.

DIgby 4-4950

stock¬

the

ance

earnings

the

position of the stock¬
companies.

ment in the

sheet

balance

forma

pro

stockholders'

$22.50

of

equity

net

and

a

of

assets

current

a

long-term debt and no pre¬

no

stock.

ferred

the

at

to

1949

aver¬

consolidation,
40c for the first

after

Lima

for

initiation

the

—

of

production.

record

demands of the civilian economy.

present

Prospective
L. Heine

Max

fect

overcome

the

recent

The

problems.

statement of Lima Hamil¬
Corporation proposing con¬
Baldwin Locomo¬

solidation with

Corporation encourages the
that a
complex situation

has

successfully

been

Enterprise 6800

Pocono Hotel Corp. Units
Warner

Company Common

West Penn Power Common
Buckhill Falls Common

Penna. Power &

Light Common

railroads

American

steam

from

diesel

to

Baldwin

lost

market

the

major product. In addi¬

much of the heavy ma¬
constituting both com¬

Philadelphia Transportation Co.
Pittsburgh Railway Issues W I
Dan River Mills Common

well

Henry B. Warner & Co., Inc.
Members

Phila.-Balto.

Stock

Exchange

>123 South Broad St., Phila. 9, Pa.
Phila. Telephone

Bell System Teletype

PH 771

PEnnypacker 5-2857
New York

City Tel.:

BOwling Green 9-4818

limitless possibilities in a peaceful

society which will be

America

its

is

cultural

genius

Lima

development

areas

the

of

Baldwin

biggest job the
will

ever

"Winters & Crampton

undeveloped

of

world

*Lea Fabrics

the

over

and

always relied on export for a good
part of their business. To help in
the

TRADING MARKETS

use

spark

to

all

progress

Both

ours

finally able to

productive

world.

propulsion after the war Lima as

tion,

Hartford, Conn.

only of the domestic market,
hitherto untapped

if

for their

Enterprise 2904

but also of the

world

as

Tele. BS 142

2-5500

Portland, Me.

As to the future, I like to think
not

comparing with the most difficult
reconversion problems of postwar

well

Tel. HUbbard

of the past years.

belief

mastered.

af¬
the in¬
beyond the level
unless

company

rises

come

proxy

the

profit taxation

excess

will probably not importantly

by

management

When

Dealers Ino.

will

twilight

action

switched

Securities

of

the steam locomotive business and

proxy

tive

Assn.

Equitable Gas Common

state ments

ton

Nat'l

75 Federal St., Boston 10, Mass.

Allan Wood Steel Com. & Pfd.

stage of political
presumably
soon
employ whatever reserve capacity
will be left unused by the rising

unusual

J. B. Magniie & Co., Inc.
Members

of

rate

Earnings for the

1947

only

were

The

taken

Quoted

1941 in Lima and

since

from

period

—

annual reports

to

—

currently

pay

annual

1938 in Baldwin.

Diesel

a

Sold

Open End Phone to New York Canal 6-1613

companies

unbroken

The

of

—

60c. There is a record of dividends

financial

give

Bought

June 30, 1950, for the con¬
solidated
companies
shows
a
per

accounted
for
by
the
lag
created by the disappearance of

achieve¬

and

Manufacturing

both

holders of
The

Bates

in

may

improve¬

real

a

merger

now

ly

ment in terms

success.

branch offices

our

six months of 1950. This was part¬

story of

past

for

make

time

but

tell

statement

the

uncalculable

outstanding

sheet

and

of

benefits

The
while

aged $1.25 on the combined stock

Bal¬

holders.

"Plywood Inc.

might be the

consolidation

new

undertake.

"Douglas & Lomason

chinery

panies' business did not lend it¬
production. In
these days of rising wage rates
and
even
steeper
increases of
other elements of labor cost, such

self readily to mass

social

as

method of

and

services

or

one

shortened

old time-honored
a

few of

a

kind

had to be modified.

The

consolidation
to solve
To
quote
the

proposed

should

go

these

long

a

problems.

BERWYN T. MOORE

Louisville, Ky.

.

.

Co. Common

their

economy,
is
Northern
Indiana
Public Service Co. common stock.
For about

three

are

ly.

in

fields

the

be

portant a new pattern
tion

can

be

Most

ued

Lima

we

are

convinced

industry

the

Resi¬

manufacture and sale of our earth

dential and commercial customers

moving machinery can be greatly

a

phase,
i

where,

that

point

i
Berwyn

T.

Moore

n

g s

New York 5

Tele. N. Y.

1-2494

and

lowed

our

those

N.Q. B.
OVER-THE-COUNTER
INDUSTRIAL STOCK INDEX

a

was

growth
earnwere

11 "Year

Performance of

35 Industrial Stocks
BOOKLET

reasing,

n c

ON

REQUEST

dividends
were

lifted

-the
as

whole

im¬

generally speaking, only one type
of heavy machinery will be built
under one roof. For example, at

to

that

in

We

contin¬

out

of opera¬

established

utility

have

but very cost¬
concentrating all

secured.

4-6400

good oper¬

stocks.

locomotive

can

WOrth

the

ating

very necessary,

ume

Corporation
111 Broadway,

sug-

of

of

development, which

Further, by
the

AETNA SECURITIES

attractiveness

production at
one location tooling requirements
will be reduced and greater vol¬

of

request

years,

have

g e s t e d

be

if
(Baldwin
and
make joint use of

facilities

research and

can

on

Stock)

The "Security I Like Best" as
heretofore, and even in a defense

way

economies

Great

accomplished
Lima) could

*Information

(Northern Indiana Public Service

statement:

proxy

"Copeland Refriger'n

President, Berwyn T. Moore & Co.,

we

to

per

around 32

Securities

this

June 30,

shares

Over-The-Counter

of

plant the company's earnings per
share
jumped
from
$2.39 per
share for the 12 months ending
1949.

Primary Markets in

completion

the

With

ing

appraising

work week, the

power.
-

investor will
plenty of food for encour¬
aging thought when looking over
Lima Hamilton's communications

of

La.-Birmingham, Ala.
Mobile, Ala.

product."

particular

dividends

have

•

NY 1-1557

HAnover 2-0700

New Orleans,

Direct wires to

Both

Corporation)

Hamilton
The

industry

Equity.

this

Puget Sound Power & Light
Scranton

Soon

New York 4, N. Y.

simplified and extended if the
manufacturing organization there
is concentrated entirely upon this

Lima

form part of Baldwin

to

to

25 Broad St.,

Presi¬

Moore,

T.

Curb Exchange

Members New York

Service

present market price of $10. There

City.

(Lima Hamilton Corporation:

the Security I

as

Public

share. These figures are
substantially
in
excess
of
the

Like Best.

Capital Stock

1st Floor,

Co.

Members New York Stock Exchange

T. Moore & Co.,
Louisville, Ky. (Page 2)

is

Electric

Steiner, Rouse & Co.

Co.,

Berwyn

dent,

$14.40

Marquis & Co.,

New York

Shelby Friedrichs

Louisiana

to

Lima
Heine,

L. J. Marquis &
City (Page 2)

Co.—Berwyn

share

Partner, L. J.
G.

present

Common

Churchill-Downs Inc.

BANKERS BOND

individual

average

MAX L. HEINE

With

in

Central

Common

is suit¬

investor.

mind

I

American Air Filter Co.

the

for

able

of

this

Baldwin

Indiana

Northern

as

corno n

Soon

Corp.:

New York

per

The stock is unlisted and

ob¬

to

La.

per

value.

in

Louisiana Securities
Bought—Sold—Quoted

Partner,

usually bring about enhancement

of
marketability

degree

tain this

150

percentages of earnings disbursed
as dividends in the future.
These

a

Orleans,

New

Hamilton Corp.—Max L.

New customers continue

With most of the company's ex¬

considerable

order

Tel. REctor 2-7815

to

pansion program completed, this
growth should be reflected in bet¬
ter per share earnings and larger

that it

sacrifice

1949

of

end

the

1947.

if necessary in

BROADWAY, NEW YORK 5

the

Co.,

part, of

form

At

month. Dollar rev¬
residential customer is
also increasing, having averaged
$44.79 in 1949 against $40.03 in

is worthwhile

120

60%

revenues.

be added at the rate of better

enue

con¬

am

vinced

Curb

&

Hamilton

Lima

1945 the company had

by

21,200.

in value.

Since 1917

York

operating

and

900

enhancement

I

New

richs

approximately

for

gross

than

(2)

A minimum of risk;
return;

(1)
good

Specialists in

Co.—

Partner,

(Page 2)

the end of

to

Electric

Friedrichs,

Shelby

of

York 5

New

intended to be,
sell the securities

11,200 such customers. By the end
1947 this had increased to 15,-

La.

New Orleans,

Teletype NY 1-583

BArclay 7-5660

SHELBY

G.

Alabama &

Howard, Weil, Labouisse, Fried¬

not

are

account

Partner, Howard, Weil, Labouisse,
Friedrichs & Co.

Corporation
120 Broadway, New

forum

they to be regarded, as an offer to

are

G.

and

Selections

Louisiana

Central

particular security.

a

discussed.)

New York Hanseatic
Established

a

for favoring

Participants

Their

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

Week's

This
Forum

who

being

have

fol¬

suggestions and bought

Continued

on

page

20

National Quotation Bureau
Incorporated

46 Front Street

New York 4,

N. Y.

Volume 172

Number 4942

.

.

The Commercial and Financial Chronicle

.

(987)

.

New

Houses
The

housing agencies are
fostering today's dangerous housing boom through easy credit
peak in home budding

imminent,

New

and recommends

investment in homes in small rather than large cities.

Many
think

people
of

ask

the

what

me

housing

present

boom, how long ic will last and
whetner it is wise to buy or build
homes

new

Gls

I

bait

and

of

Briefly,

in

future

first

seven

months

1950,

terms

of

non

What

farm

-

A
ent

now

United

the

the

July

month¬

new

record

144,000
up.

construction?
summed

Tne

in

up

credit.

easy

availability
guaranteed

which

has

words:

tnere

by

are

the

loans

government

and

sustained

the housing boom.
What

Is

Government
not
and

as

it

become

may

a

necessary device in the promotion
of our national interest.

However,

I

am

opposed

to

the

abuses

of

priming.
The
powerful
Housing Agency is fostering to¬
day's
dangerous
housing
boom.
Through its easy credit terms, it
pump

the

-

should

hasten

construction

expanding
It

the

is

probable

mortgage

dubious

value

disastrous

on

if you

viewpoint.

these

loans
take

They

following

when

wages

are

long

a

can

of

prove

times

like

and prices

artificially high basis. I
greatly
disturbed
when
I
an

see

proudly

and

Others will

only
due

so

be

Some

cities

easily

expecting

of

acquired.
difficulties

something

for

nothing.

present

these

city

units

at

any

price because of the possibility of
their

of

being

bombed

and

of high city taxes and livjng

zeal to

keep costs at

being built.
or

In their
near $10,-

000 per unit, builders seem to have
concentrated
many
rooms.

too

small

houses,
only four

of which have
Certainly these latter

not very

are

practical for family liv¬

ing

in

Nor

will

resale

on

the

American

they

have

a

tradition.
very

value.




6

-

Obsolete

6

Brehon Somervell

99

good

WALL

buying the
a

post at

most

big smile

on

Securities

obso¬

his face.

Dept.

STREET, NEW YORK

*

Telephone: WHitehall 4-6551

9

International

in

Financial

Cooperation—Hon.

John

W.,Snyder
How

to

10

Meet

Government

Mortgage

Competition—Horace
11

Mortgage Credit and Inflation
Consumer's

Interest

in

Controls—William

Utilities'

Success

A.

Richard

—

Announcing

13

Lyon__

The Installation of

L.

Rosenthal

15

An
*

*

Open-End Phone

*

President Truman Outlines Impending Economic Controls
Thomas B.

McCabe

Wilfred

A.

May

Post-Korea

Warns of

Credit

to

8

Benjamin

and

Investment

10

Expansion

Graham

to

Problems.

Course

Give

Philadelphia

on

Ira

Ilaupt

George

Company

&

11

___

Mutual

Funds

MArket 7-6771

at

Exhibit

Fair

State

Bauer

F.

Sponsor

13

Describes

Thermometer, Not

E., S.

Pillsbury's

Gold

Plan

as

Protector____^___

a

14

Let's Not Stifle Discussion! (Boxed)
Federal

Tax

Program

18
in

Analyzed

National

"Letter"

Incorporated

18

-

■

\

J.F.Reilly&Co.

Bank

City

61

Broadway, New York 6

.

BO 9-5133

Also, remember that today

there is

home

a

to

4.1 per¬

every

Only tOne

for

Day

19

Work?

Advocates Consumer Loans by

while the previous satura¬
tion point came in 1930 when the

Teletype NY 1-3370

Savings and Loan Associations 20

sons;

people
home

Don't
I

satisfied

were

for

each

Overlook

would

not

with

Cities

Small

buy

any

of

of

one

was

es¬

within

live

I

them.

valuations

nerable.

it

unless

Big

buy

or

family's

a

with

use

It (Editorial)

See

and

10

Stocks

Insurance

Securities

Canadian

Foote Bros. Gear & Machine

18

Coming Events in the Investment Field

city

Investment

Dealer-Broker

Liberty Products
Texas

8

Recommendations

house for my
a
30% down

I

convinced

am

tion

trend

cities

the

popula¬

from the larger
continue,
thus
de¬

big

city

Engineering & Mfg.

Continental Aviation &

8

real

estate

Eng.

Lear Inc.
Einzig—"Need of Internat'l Financial Defense Coordination". 17
Washington Ahead of the News—Carlisle Bargeron

From

7

Business Activity

Indications of

Singer, Bean

Mutual

37

NSTA

HAnover 2-0270

16

Notes

MACKIE, Inc.

&

12

Funds

away

will

creasing

that

EQUIPMENT

MANUFACTURERS

Cover

vul¬

Yet, I would not hesitate

build

We

the

too

are

As

Bank

a

AIRCRAFT

Regular Features

one

population!

house today
of the larger cities of the

property
to

of

4.4

40

Exchange PL, N. Y.tf

Teletype NY 1-1825 & NY 1-1826
News About Banks and

Bankers

;

26

—

values.
It

also

be

may

that

an

older

type, well-built house in the best
sections
a

in

of

better
the

may

these

smaller

than

buy

a

present crazy
more

half

to build

is

house
market. You

house
originally cost to build,
will still be getting it for

pay

it

cities

new

of

for

what

such

a

it would

Smith,

Barney

Hartford

&

Wilfred

Co.,

5

May

Report

Reporter's

43

Our Reporter on Governments

Prospective Security Offerings.-

41

Public Utility

Securities

U.

S.

SAVINGS

BONDS

20

diut

Securities

25

Salesman's

Securities

Now In

Corner

19

Pnewtpt Wine- Senates

38

Registration

FOR BROKERS AND DEALERS

The

Security I Like Best
State of Trade and Industry

5

LOS

as

office, Hartford-Aetna Building.
Mr.
Bayliss was formerly with

ANGELES

DENVER

(Walter Whyte Says)

Tomorrow's Markets

Washington and You

'■

To Western markets in

2

The

of their Hartford, Conn.,

manager

BUY

14

Securities

HARTFORD, Conn.—Charles E.
Bayliss
has
become
associated
with

Our

Railroad

Bayliss Manager for
Smith Barney in

Observations—A.

cost

today.

the size of the majority of the new
now

;

Changing Times—John H. Patterson

be¬

cause

about

aspect of the housing
which distresses me is

houses

Baker, Jr

in

B.

'

costs.

but you

Larger Houses

Another

situation

Progress

Mineola

that the

our larger
suddenly turn into a
The day may not be far

of

than

Buy

our

may

surplus.

will

able to keep them

price

the

at
to

persist.

homes which they so

new

Market—Malcolm

most small American communities.

justified only if these ex¬
tremely favorable business condi¬
lose the

for

am

be

should

a

payment in the better sections of

people getting involved in
operations and commitments that

tions

to

are

young

can

Production

Bond

99 Wall Street

lete junk with

home

new

scarcity of housing in

limits

range

long

return

provide
population.

that

nation great.

Government

would

before

to

sential

Easy

demand

normal market in

more

States

our

Influencing

Korea and Taxes—Gen.

I

Recent
tightening
of
housing credit and a very
material increase in government
stockpiling of strategic materials

in

which

You'll always find him at his

of

Federal

United

resourcefulness

GOOD HUMOR MAN

Securities—Allan R.

anyway.

thrift

have made

However,

satisfied

is encouraging individuals to dis¬
card
the principles
of industry,
and

Industry

Russell

accumulation

housing

been

some

pump-priming

ours,

have

THE

3

4

Lees and Davis L.

Expect?

off when it will be difficult to sell

Wrong?

is
bad in itself. In a
complicated
highly industrialized economy

such

We

trouble.

that

MagilLCover

sub¬

imminent, owing to

appears

deferred

is this ready

mortgage

created

be

can

two

course,

of

home

new

answer

but it

is

unprece-

of

just

Of

other factors,

Wnat

-

this

dentedly high volume

units

chalked

was

for

of

Should

Korean

believe

Processing

AND COMPANY

Cover

and

they

sharp decline from the pres¬
peak activity in home building

started

States. In

reason

needs

Perhaps if
to proffer a

values.

aown
payment, as were
fathers, they would be more
discerning and more practical.

in

the

future

purchases

their

new

dwellings

Roger W. Babson

these

stantial

were

ly

of

a

nearly

800,000

a

of

required

were

the

best

Shoe

or

think

to

are

During

at

time

no,

Nystrom

Findlay

the

by

Food

and

Factors

these

conclusions:

Food

lured

H.

Houses—Roger W. Babson

small,
down payment and the promise of
easy mortgage terms, should take

now.

my

others,

Outlook—Paul

Page

Fiscal Resources for the Emergency—Roswell

Our

Says sharp decline from present

appears

Business

llCHTEIlSTEIIl

-

Articles and News

Babson contends powerful Federal

and government guarantees.

,

INDEX

By ROGER W. BABSON

Mr.

3

•

SPOKANE

•

SALT

LAKE

CITY

34
44

Putnam & Co.
Published

Twice

1

Weekly

Drapers'

land

COMMERCIAL

The

U.

R6g.

25

Park

WILLIAM'

Patent Office
COMPANY,

Publishers

2-9570

to

DANA

as

RIGGS,

Subscriptions

Possessions,

Manager

Dominion
Other

in

Union,

Off^es:

HI.

175

South

(Telephone:

La

Salle

States,

Febru¬

Canada,
Countries, $52.00

U.

S.

Members

and

$45.00

of

of

per

$48.00
per

year;
per

J. A. HOGLE & CO.

in

1915

ESTABLISHED

year.

Members

year.

New York Stock Exchange
Other

Thursday (general news and ad¬
vertising i§sue) and every Monday Com¬
plete statistical issue — market quotation
records, corporation news, bank clearings,
state and city news, etc.).

3,

matter

United

Territories

Every

n*h*r

Eng¬

Subscription Rates

President

Business

second-class

Thursday, September 14, 1950

Chicago

C.,

1879.

Pan-American
D.

E.

Smith.

25, 1942, at the post office at New
York, N. Y., under the Act of March 8,

9576

SEIBERT,

London,

&

ary

SEIBERT, Editor & Publisher

I).

WILLIAM

Reentered

Place, New York 8, N. Y.

REctor
HERBERT

S.

DANA

WILLIAM-B.

Gardens,

Edwards

Copyright 1950 by William B. Dana
Company

CHRONICLE

FINANCIAL

c/o

and

St.,

State 2-0613);

Publications

Bank and
Quotation Record — Monthly,'
$30.00 per year. (Foreign postage extra.)

Note—On

account

of

the

fluctuations

the

in

rate of exchange,
remittances for for¬
eign subscriptions and advertisements must

be

made

in

New

York

funds.

and other Principal

<

50

j
,

Exchanges

Broadway, New York 5

Telephone WHitehall 3-6700
Teletype NY 1-1856

\

£

4

The Commercial and Financial Chronicle

(988)

are

Food and Food Processing

Stevens

Scudder,

noon

subject

my

erate

food and food

is

the approach of
the investment analyst.
The in¬
vestment approach involves many
processing from

problems that

might not have

on a

the

and

investment

each

for

analyst

well

as

Fruit Co.
would suffer much more, as it did

snould
be
try to know

approacn
to

his industry and his company
most

Conversely,

during tne 1930s.

al¬

There

the top officials of

as

If you do not

know your subject
frequently find de¬
that catch you un¬

to

around

scurry

which

in

and they are often costly
developments about which you
have

the

there

simi¬

certain

are

larities, a principal one of invest¬
ment significance being that they
all sell products more or less di¬

awares,

then

for

biscuit, the bread
bakery, and the dairy companies,

that well, you

rect

to

the

to

costly to do that.

try to find the answer after it is

labor

too late.

raw-material

rious

very

high

a

unionized.

investment

factors

different

in

drinks,

another group

Now,

food processors, and
then take one industry, the corn

first

refiners industry and go into con¬

are

siderable detail in this.

tightly

are

—

General

both process and

of

groups

Foods

have

Now, first let's cover a few of

Standard

and

blush

At

Brands.

would think they
companies.
They

you

two similar

sell coffee. They
similarities, but Gen¬

some

these basic food processing groups.

eral Foods has

There is

underlying similarity
in all food processors.
They are

business; Standard Brands doesn't.
Standard
Brands
has
a
liquor

all

business.

one

dependent upon agricultural
produce.
Beyond
that point, I
the

think

dissimilarities

Companies
few.

a

Fruit Co.

is

self.

United

The

one

The

dominating invest¬
in this company is

factor

ment

industry unto it¬

an

volved.

that it is

I

as

a farmer.
As
it is the only big

that is

food processing company

a

there?

and many other products
tropics—cultivating them,
harvesting and transporting them
to this country, and in the mean¬

is

use.

,

Now, what does that mean? You
from economics

the
the

from

supports and from
United

flation.

only company
has

t.

,

of
rubber tires if they have to, and

could make very good gum out
old

when

needs

been

synthetic.

have just

given you a bird'sview of these various grouos,

I
eye

have tried

and

the

raw

problems are that you,
budding analysts, must face in
order to understand these differ¬
as

ent

companies.

The-

is the

What is the investment

fully

as

cance

to

are

same

*A lecture given on
in

a

of

series

17

signifi¬

the analyst's point of
Well, it is that they have

&

Vermont's

Department

of

That

these

companies are
subject to inventory profits and
losses.
Their earnings fluctuate
widely as a result.
Out of that
problem the analyst frequently
has many headaches
and many
unforeseen profits.

Commerce

Economics.

Keyes Fibre Company

means

Then, the

Preferred

sugar

Common

sugar

processors

and Western U.

Bought

—

Sold

—

Quoted

ducers in
Pureta

pipes,

S.,

in

the Midwest

cane sugar pro¬

Louisiana, Florida, Cuba,
Hawaii, the Philip-

Rica,

the

Dorrunicap.

Republic,

'

Ralph F. Carr & Co., Inc.
31 Milk

'

•-<

v-;

)

>,'■

Teletype BS 328




cane

sugar

moderate

a

directly

going

the

to

That has

their
they operate.

bearing
how

Let

individual
important

an

problems

on

and

summarize first briefly

me

various

the

phases of the indus¬
try with which you should be
familiar, from an investment re¬
search approach, illustrating the
extent to which you should know

Every one

of those groups of companies has

its

own

problems'" many of which

is

corn

belt

around

particularly Iowa

(1)

Raw materials and costs.

(2)

Manufacturing

lation

and

products.

corn

around

Chicago.
economically in re¬

the

markets

for the

area,

the

other

extremities

the

on

East

Coast, between,
let's say,
Bangor, Maine, and Washington,
absorbs

80%

the

of

industry's

output.

Profit

and pricing.

Competition

(5)

in

the

all

significance

pictui e, is that, with
and' with the corn

corn

that

corn

refiners

using^ofily 4% of it, you
would think there was no problem
at all in their buying corn.
That
isn't

The price
and availability of corn to the corn
refiners are largely determined by
the relationship between the price
of corn and the price of meat ani¬
mals.
Most of the corn crop is
always the

margins

and

further

'

factors.

of information.

Sources

(6)

case.

directly to hogs or beef cattle.
Only 25% of all the corn produced
the

to

Miscellaneous items of the
Corn Products Refining Co., par¬

accounting factors,
illustrate a lot of things that

ticularly
will

The

corn

you

other companies.

in

into

run

to

refiners basically pro¬

duce starch from corn.

They then
process starch further by a treat¬
ment which fundamentally is the
same

as

the human

That

ess.

glucose,

jtrude

digestive

produces

corn

and corn

^ugar, both

^the

refined,

and

proc¬

syrup,

latter

also

as

dextroS^, the tech¬

name

of

simple

known

nical

it is.

sugar,

by-products are oil, gluten
and meal; also recent new

feed

products which I will go into
we

is

This

only

are

before

too

condition

cash

market

Sales

million
around $30 to
$450

net

and

after

taxes

net

meat

to

brings the price of

the

$35
be

if it were all
but nevertheless there are

in one,

a company,

attractions

investment

in

industry that I will bring out
we

go

First,
should

along.

the

know

a

to

understand

is

a

*■'

.

little

is

twice

,

You

about

at

corn

up

tage

competitive disadvan¬

a

Fur¬
the gov¬
deliberately set a policy

with

products.

other

thermore, during the

that

of

crop.

the

Its

wheat

is equal in value to all the

combined oil and coal produced in
the country,
a

crop

and is worth more as
than: the combined net

worth of General Motors,

duPont,

and United States Steel.

producer of

corn,

accounting for

two-thirds of the world's
output, and we use practically all

nearly

materials

raw

corn?

pound of starch.

a

000

It

re¬

gallons of water
corn. The

a

bushel of

uses

enough

process

to take care of

year

than

pound of coal to

a

quires about 40
to

other

needed

It takes

produce

important

the

are

water in a
city of 100,-

a

people, and around 2 million
Obvi¬

tons of coal are consumed.

the

ously

pendent

The

cost

$600,000
1950

would

strike

the

of

late

of

1949

refiners

corn

for its first quarter

more

coal

are

than they used to

so

coal

one

de¬
Lewis, al¬

John

Mr.

on

though less
be.

refiners

corn

than

requirements

otherwise

have

the

been

case.

What

ernment

plants

encouraging the production of
hogs.
The result was a price
on

which

corn

ceiling price
we
produced

above the

was

cash

on

Thus,

corn.

122 million hogs in

with 80 million
and the corn refiners went

compared

prewar

without

causes

terioration

mean?

water

flowing through

rapid rate of de¬

a

the

in

equipment,

higher plant maintenance and all
that

of

sort

Those

thing.

that

factors

vestment

in¬

are

im¬

are

portant to know because they af¬
fect

and

costs

profits.

With regard to

of

1943

the

does

war

refining

corn

by-products, the

industry! used

nothing

produce

starch

but

to

and

They threw away all the

syrup.

rest of the materials, all

Continued,

on

the hulls
page

32

corn.

Furthermore,
corn

a

into mixed feeds.

goes

mostly small busi¬
such, it was easy for

country,
As

nessmen.

mixers to get around
price

in

of feed

mixers

400

are

large part of the

and
corn

txxxxxxxxxxxxnxxxxxxxxx:
M

H

H

M

M

CHEMICAL, DRUG

M

war¬

M

M

from the

away

Changed Outlook for

H

controls,

quota

refiners who couldn't
operate that way.
This

and LIQUOR

M

M

bigger

corn

M

to

Stocks

M

to

the tough

time the corn
getting corn during

had

the Semi-War

in

M

Economy

M
H

see this 56Value
Line

H

war.

A

economic

related

vestment

significance

1934

1936

fact

and

and

the

The

price

corn

we

crop

of

in¬

is that in
droughts,

had

was

way

went

up

off.

Every investor should

M

the

page

H

Ratings & Reports covering Chem¬
ical, Drug and Liquor Stocks.
It

H
M

corn

to

you
specific estimates of
earnings and dividends and
probable trend of each com¬
pany's earnings and dividends next
year based upon an excess profits

ihe

M
H

tax

disadvantage
1 competitively.
Thus, their earnings were severe¬
ly reduced or converted to deficits

M

tions

a

temporarily.

Now

have

we

a

new

kind of corn, hybrid corn, which is

and

demands and

new

under

semi-war

a

H

M
M

M

The

changed outlook1 has sharply
affected
the
relative
position of
stocks in these industries, some of
which

shown

are

valued

and

H

M

M

Act

corn

H

56-page

H

cal, Drug and
including :

You

have

when

soft,

know

that

it is harvested is

frequently
It doesn't keep

wet corn.
well, but corn

or

it

use

to

effectively,

they get it at
if there is

a

refiners
so

lights

are

some

of the

industry
point. Now
an

corn

I

materials stand¬
would like to tell

something

of

of

in

corn

drawing of the kernel
which

you

have

the

hull

outside, and the germ con¬
taining the oil in the center, sur¬
rounded by starch.
The problem
is

to

extract

Lambert

in

each

of

those

Fastman Kodak

Company

Lehn & Fink

Hercules Powder

Monsanto Chem.

Parke, Davis

Anheuser Busch

H

Rexall Btugs

Schenley

M

Sharp & Dohine

Hiram Walker

M

$5.00 INTRODUCTORY OFFER

M
H

subscribers only,

(New

M

3

weekly

~

editions

cial

Situations

Recommendation,

Report,

Account

Fortnightly Letters and

Supplements.

H

tion

s*

Plus

4

2

Weekly

subscrip-

(Annual

$95.)
the

Chemical

Issue

at

no

Send S.-> to

sub¬

big tank of boiling water
just as you do an ear of corn on
your stove.
In the process it is
softened and then ground lightly
to break the kernel.
Thereupon

includes 4
Ratings and

of

Reports—covering 177 stocks in 14
industries. It includes also a Spe¬

and

extra

Stock

Drug

charge

Dept. CF-2

VALUE

It is done by steeping the

stances.
corn

Bow Chemical

Du Pont

J
a

^

Sterling Drug
Anier. Cyanamid

Bristol-Myers

Supervised

used.

Here is

Liquor

Mead Johnson

raw

briefly

seeing this
44 Chemi¬
Stocks, in-

assure

covering

Gillette

corn.

the

the
manufacturing
processes
and
other
important
raw
materials
you

to

issue

Abbott Labs.

sometimes

high¬
situation from
of

today

Araer. Home Prod.

:an

market advantage

lot of wet

a

M

l.

These

^

are

for

less.

far

J
^

months.

mended"

nerability

is

under-

he still

to

"Especially Recom¬
high income and ap¬
preciation potential in the next 12

M

M

drought

restric¬

economy.

M

being used almost entirely in the
corn belt, and, therefore, the vul¬
to

m

1950

M

a

corn

M

brings

M

H

of

placing the

the

of

issue

refiners at

level

corn

this industry. Corn

major agricultural

value
crop,

"

materials.

raw

starch

as

Materials

Raw

what

price of

point which puts the corn re¬

a

finers

only

That would not

million.

certain

as

industry.

dried

processed into glucose

The

Now,

nor¬

sometimes

because

demand for meat and the

very

small

about

large

the

a

taxes

million

$20

as

along.

go

plants.

some

dextrose.

That much water

refiners

(7)

used

now

are

in

purpose

or

afford

profit

machines

this

or

added

•t

ulti¬

so

fed

taking, cash

,

trifugal

industry
of

A second factoi

top

on

segregate each one of
elements of the corn. Cen¬
you

in¬

Coast, the point being in Chicago
and

the

and

"settling

gluten floats

mately

products.
A pie-shaped
from Chicago to the East

time

(4)

the

those

plants

to

many

Markets.

(3)

starch

the

long

tables,"
the starch drops to the bottom and

dustry's

the

proc e s s e s

leaves
on

The starch is then

There

refipej-s'ralqpg* [the East Coast, the

Bquth^and the West.

all the

corn

That

gluten

for

cash

industries:

your

out the hull.

termines the location of most

level

The United States is the largest

Street, Boston 9

Tel. HUbbard 2-6442

ancT then therfe are the

Only

consumers.

consumer.

companies. You

might think the sugar business is
one
nice, coherent industry.
It
certainly isn't.
There are beet

Class "V

companies,

part of their output is in a form

buy at the price that prevails

will not decline for one
solid year until the next harvest.

alysis sponsored jointly by the New York
Securities
Industry and the University
of

cial

at that time and take the risk that

July 31, 1950, the
on Securities An¬

a

and

corn

You must understand that basic

unlike
the
chewing gum companies, for ex¬
ample, deal almost entirely with
the large industrial and commer¬
These

goes
through
what
we
probably should call sifters to sift

Now, what is the investment
significance of this? First, it de¬

Refiners

Corn

The

The

the price

10th

three-quarters of
the Great Lakes,
and Illinois.

comes

Now, let's take the corn refiners.

ma¬

from

view?

-the

produce

in

of

exporter

stance

of three farms in

mally.

or

crops

illustrate what

to

of the

some

that

war-price in¬
Co.

increasing per¬

centage of the gum base used has

,

true of the canners and their raw

The other companies op-

farmer.

,.M

fruit and vegetable needs.

Fruit

as

probably

harvested in the fall.

in the group that

benefited

is

chewing gum companies

the

a

terial

price

controls,

It

the bulk of their annual

may

government

'

in, and, therefore, they must buy

have had or from
study of the war neriod, that
farmer has greatly benefited
you

" I

paper every

all know, I think,
that

J ;

market; it is quoted in the
day, but it is not big
or
widespread enough for these
companies to operate effectively

time, processing them into a form
can

,

they
operate on an annual-crop basis.
There is no widespread trading
market for selling cottonseed, soy¬
beans, or the various other oilproducing seeds that these vege¬
table oil processors handle. There

in the

we

•

al¬

Actually I have been told

States.

that

"

processors.
What is the
investment factor of significance

sugar,

which

:

Midwest

produced

materials from outside the United

Then the caqners and the vege¬

requirements. Its work con¬
of growing bananas, cocoa,

cane

.

table oil

farmer, although some of the sugar
companies raise part of their sugar
sists

'

-

basically
know,

en¬

•

1

far

are

operating prob¬
lems.
Within the liquor division,
Standard Brands has an impor¬
tant
Scotch
whiskey on which
there is only a distribution profit.
It has a domestic whiskey busi¬
ness in which all of the problems
of
the
liquor industry are in¬

Variety of Food Processing

take

are

different

tirely

greater than the similarities.

Let's

differences

The

qiiite significant. There

far

are

big frozen foods

a

problems

they obtain their basic raw

cause

tically all of the distribution sys¬
the food field, breweries,
soft

company.

though in times of war or in times
such as the present, there are be¬

cost, and generally means
problems, because prac¬

and

successful

the

is

Normally there are not many se¬

tems in

ing to go over some of the general

It means

the

world produc¬

biggest

Two'out

This is sound

real labor

Now, in order to illustrate this
approach, rather than cover the
food processing industry, I am go¬

is

It

consumer.

you

are.

gum

in recent years an

other companies,

are

instances,

those companies.

velopments

United

otherwise,

and

it,

they

the

is

refining

diser

but

meal

tne

tnat

not,

do

companies and
companies again
problems. The prin¬
cipal problem is one of merchan¬
dising, just as with cigarette com¬
panies.
The successful merchan¬
Chewing

in

believe

tion,
corn.

Argentina, with

of total

confectionery

just studying these fields,

in
I

what

ourselves.

10%

have different

should we have a
reversal of these conditions, price

you

for

reasons

know

it

only

know

will

logical

spread. They buy their
agricultural products, process
them, and distribute them. There¬
fore, they have not benefited so
fully as has United Fruit.

this after¬

it,

If you

results.

vestment

of

prob¬

they affect in¬

and how

are

must

profits and losses. Urges close analysis of operating results.
understand

must

find one day that one
group is behaving very nicely and
another very poorly.
There are

similarities and dissimilarities in food proc¬
essing companies, Mr. Finlay discusses, by way of illustration,
the corn refining group from standpoint of raw materials and
costs; manuiacturmg processes and products; competition and
prices; profit margins and profit factors; and sources of infor¬
mation. Stresses importance of proper accounting for inventory

I

analyst,

separately and

each

lems

you

FINLAY*

After pointing out

As

investment

-

study

Clark, Investment Counsel

&

an

what the differences in those

Industry Securities
By ALLAN R.

different from the others. You,

as

Thursday, September 14, 1950

...

LINE

a

the germ floats, to

skimmed off.

Investment

Survey

Value Line Survey Building
5

East

44th

St.,

N.

Y.

ARNOLD BERNHARD &

17,

N.

Y.

CO.. INC.

the top and is

The rest of the sub¬

IIIiriirXIiriTYTTYYYYTO

Volume 172

Number 4942

..

.

The Commercial and Financial Chronicle

rr

Value Line Distributors

Electric Output

Carloadings
Retail

State of Trade

Value

Auto Production

Business Failures

ment

Total

industrial

attained

a

production

the

for

as

whole last

a

ably above the level of the corresponding period a year ago.
In
keeping with the upward trend of business and industry, total
claims

show

for

unemployment insurance for the latest week
slight falling off from the level of the week before.

a

The

voluntary

granted

wage increases

improved pension

and

in

charge

of

national

distribution.

announced

were

Friday, last, and in

instance

one

by

the

several

J. M. Hickerson

with

firms

the

has

On

of

Just

a new five-year wage contract,
immediate nine-cent hourly pay raise for 21,000

*

*

M. Hickerson

J.

program, according to reports, was
National Production Authority equipped with

firm

advertis¬

of
Albert
FrankLaw,
Inc.,
effective

Guenther

it was announced
Emmett Corrigan,

industries.

Chairman

the

Secretary of Commerce Charles Sawyer, acting under Presi¬
dent Truman's authority, announced that William
Henry Harrison,
of New York, President of the International
Telephone and Tele¬
graph Corp., will head the National Production Authority.

rectors

powers to promote the flow of essential materials to war

agency will be a
will function along

and

merce

part of the Department

the

lines

of the

War

of Com¬

Production

Board

of the last world war.
It will handle priority, allocation
inventory controls provided for under the Defense Production

and

Act which President Truman

The

of military and related demands on the steel
increasingly in evidence, "Steel," national metalworking

authority, states this week.
difficulties

curement
<

are

Civilian

whose

goods manufacturers'

pro¬

mounting in step with accelerated

de-

fense efforts.

of

the

of

latter

Di¬

of

Board

company,

and corporate struc¬

name

director of Albert

a

Frank-Guenther

Frank

Law.

J.

Reynolds, who has been President
of the company since
1932, has
Vice-Chairman

elected

Board

been

since

bert

Frank

&

Co.,

of

He had

Directors.

of

President

of

1917

Al¬

,

Voluntary allocations to government and related programs are
working out well so far as supplying these needs are concerned.
they are giving rise to dissatisfaction among regular customers. > Widening
gaps
in civilian steel supply banks are

But

-appearing and these promise to grow progressively
"rally, consumer complaints are increasing as the
supplies intensifies, the magazine adds.
Much

-

c

Natu-

worse.

scramble

for

duplicated

tonnage inquiry is believed circulating
among the mills and little success is attending buyers' efforts to
get protective coverage since even the premium conversion and
gray markets are
of

jammed with tonnage and offer little in the
encouragement under present conditions.
«

*

way

*

Production of energy by electric utilities reached
307,490,792,000 kilowatt-hours for the year
ending July 31, 1950. This figure
represented the highest total attained
-

to

date

exceeded

and

period ending

a

by

1%

the

during

any 12-month period

previous High

month earlier.

during

set

organized - in 1872.
Robert
Potter, Sr., has been elected a

Vice-President

Frank-

Albert

of

cubic

feet

burned

in

July

a

year

ago,

current

a

report from the Federal Power Commission also discloses.
#

Increased

retail

*

consumer

advertising in the Chi¬

and

$219 billion

business

has been in the advertising

sales field.

Upon graduation

from the University of Iowa, he
joined the General Electric Com¬

in

its incandescent lamp
advertising department and was
with the company for nine years.
In 1930, he became associated with
the advertising firm of Lord &
Thomas, leaving that organization
pany

in

1939

to

President

his

organize and
of

the

allies both rearmed and indus¬

our

Kremlin

fleet around

the

on

such

has

only—decisive

shown

unmistakably

that

will

it

respect

of airpower as our Berlin airlift, or a
than indefinite promises of TVA's

uses

Formosa—rather

river

Jordan.

foreign policy-makers have come to appreciate

our

be remembered that
director, strongly opposed
proposed diversion of Marshall aid moneys for armament purposes.
But now—post-Korea—he and his roving Ambassador, Milton I.
Katz, have sensibly reversed themselves in vigorously persuading
the recipient nations to forego economic subsidies for military

priority

Paul

pre-Korea

It will

of armament needs.
Hoffman,

ECA

our

equipment.

'

Contradictions
Toward

the

organization,

United

in

its

Help to the Kremlin

a

Nations

the

and

future

that

of

wobbly

and proposed coordinated setup,
also
does Point IV
harbor a
potential t reat.
For there is
fundamental contradiction in furthering a program which on the
has

hand

the

existing

basic

aim

furthering United States foreign
(and paid for by American
dollars); and which on the other hand is administered partly as
a United Nations project.
The program cannot simultaneously be
both anti-Communist and pro- a United Nations body that includes
one

and

containing

of

Communism

If the United Nations is thereby

put in the position of further- '

ing United States anti-Communist policy, the Kremlin's charges
of the UN

being

a

gain justification.
'in

professed

mere

tool of the United States would seem to

Also would

furtherance

our

development of backward areas,,

foreign

of

policy promote the Soviet's

charges of United States' imperialism.
France Demonstrates Bread Is Not All

name.

Current

is

Law

at

Cedar

131

office
Street.

York.

The uptown

continues at

Street,

110 East 42d

New

are

Boston,

Philadelphia,

Wash¬

ditional
*rff

vjij

v/iiT

experience also should go far in debunking the tra¬

bromide, based

on

the fiction

that

"y

gqotj

man

lives by

Continued

on

i;r '

bread

page
r a

located

Other offices

n

"d'xfi

San Francisco.

sales and

in July,

$1,900

million

more

than

Holton, Farra Adds
(Special

yearly rate

a

the

June

to The

Financial Chronicle)

LEXINGTON, Ky.—Kendall H.

rate.

The July figure was only $3,700 million shy of the record high
rate set in March, 1950.

Lutes has been added to the staff

the Midwest Stock

of
of

Output Scheduled at 99.6% of Theoretical Capacity

A

complicated

snarl

of

red

tape

threatens

to

foul

the

trade.

Smooth

prove

an

sands

of

of

consumers

The

is

supposed

Defense

impossible

the

among

operation

office

created

several

to

be

assured

Coordination.

job—especially
become

But

when

reflected

in

by

this

priority

newly
likely to
from thou¬

That's

something

That's

why

we

Stix & Co.

need

it

here
—

of

all
at

us

ML

we

particularly

ou

can

use

never

a

from

to

time.

ask

when

time

hesitate

to

difficult piece of business.

On the other hand, we've never hesitated about
others

to

the best

of

helping

ability either.

our

disagreements

So

SECURITIES

INVESTMENT

can

503 OLIVE

anytime

help,

we'd

you

have

a

problem, and

the chance

welcome

to

you

try.

think

we

Simply call

STREET
our

nearest

office.

administrators.

from

industry, who were finally called to Wash¬
ington during the last war to unsnarl the red tape of impossible
and
unrealistic priorities, have not been recruited again, this
7 trade authority notes. It adds, many of them are available and
twilling to serve, but the important jobs have been given to the
men

,

the

is

pressure

Exchange.

new

machinery of the Defense Production Act, states "The Iron Age,"
national metalworking weekly, in its current
summary of the
steel

Holton, Farra Company, Bank
Commerce Bldg., members of

^planners.

:

.

^
Steelmaking operations this week are scheduled at
Hrated capacity, up one point from the previous week

100%
and

of
the

Continued
x'rrr




on

page

35

Trading Department

MEMBERS
i iw h

b;'i!
TELEPHONE:

'

-

St. Louis LMo.

MIDWEST STOCK EXCHANGE

TELETYPE:

GARFIELD

0514,-p
SL-80

<■

Russia.

become

Steel

.

cannot have

we

bearing

agency

The head office of Albert Frank-

in

to

now

ington, D. C., Chicago, Detroit and

\

The Department said personal income soared to
of

entire

Hickerson's

Mr.
career

higher farm prices in July helped
boost United States personal income
sharply to an almost record
level, the Department of Commerce reported last week.
"

The
force

policy

office.

cago

Guenther

addition, electric utility power plants consumed a record
66,707,524.000 cubic feet of gas during July^or an increase of 9.4%
over
the previous high set in
June, 1950, and 19.2% above the
55,969,792.000

Law, Inc., in charge of

effort

and

money

trialized in 1950-51.

firm,
E.

the

J

_

In

Unfortunately,

predecessor

a

Guenther

..

dubious long-term
likened to a physi¬
rest in the country instead of immediate surgery

our

patient dying of appendicitis.
First things first!
We must
the gun-gap before we close the stan ard-of-living gap!

a

close

Other of

Mr. Hickerson has been elected
President and

us

ourselves with long-term programs

economic instead of rearmament help may be

ture remain unchanged.

the

*

impact

market is
,

*

1,

been

signed last Friday.
*

devote

cian prescribing a

into the

1950,
yesterday by

new

To

threatening

concern

for

Oct.

The

right here in New York, this is surely
for raising
living standards throughout the world.
time to

no

be consolidated

*

is

everyone

advertising
agency,
New
York, Chicago and Detroit, will

the

up of a

Reynolds

The business of J. M. Hickerson

ing

setting

J.

Inc.,

An important step undertaken the
past week to implement the
nation's domestic mobilization

sweeping

as

atomized-off
Frank

Sept. 1.

First!

against sin, doing- Lidgood individually and internationally of course
A. Wilfred May
is unobjectionable.
But the timing as we
s
the technique is all-important.
With possibility of our heads being

workers.

on

world

Stalin to gobble up.

Sunday, last, the Studebaker Local 5 of the CIO United

became effective

e^ cl-

countries

First Things

The new contract also provides for an annual increase of four
cents for each of the five
years, and further adjustments according
to the cost of living index of the Bureau of Labor Statistics.
It

rearming,

military defenses. If *.ve
handing out ecouoi. .c
before they are armed
creating new fat prizes fo

the

to

merely

are

we

Auto Workers voted acceptance of
an

worldwide

for

extending international philanthropy

around

go

a

10-cent hourly wage rise.

providing for

need

without building up

on

averted at Eastern Air Lines

was

makes
aiding

for

plan"

new

clearly demonstrated the fundamental mis¬

Ltd. and the Budd Co.

a

the

of

existing objectionability. The strong and

take

more

re-examination

a

tive offensive by the Communist North Koreans

benefits

boost served to end

pay

"bold

subsidies

strike of 2.500 mechanics

Friday last directing Secretary

out the Point IV program, against the

have greatly increased the Program's already-

Companies granting increases were Eastern Air Lines, John¬
Johnson, Inc., Home Cable Corp., the Steel Co. of Canada,

A

of

order

carry

inter ational te ision,

war

again

&

through

to

under-developed areas. The Korean aggres¬
sion, and the ensuing change from cold to hot

strike threat.

son

Truman's

important

Albert Frank Agency
To Qcnsolidate With

recently by companies in the automotive industry have
increases

Simmering War, Point IV, and the Investor

President

of State Acheson

served to stimulate other businesses to similar action.

Wage

By a. wilfred MAY
The

Vice-

as

background of the great growth in

country

postwar high with overall output consider¬

new

Fund

Harold J. Ryan

of

President

J
week

Line

Distributors,
Inc., 5 East 44th Street, New York
City, have announced the appoint¬

Commodity Pi-ice Index

Industry

Observations

Trade

Food Price Index

and

>

Ryan Yice-Pres. of

Steel Production

The

(989)

Merrill Lynch,
7ii pine
'»<).{

Pierce, fenne| & 0eane
neV"yor^' s,^. Sf? "

street;

b'liVv/J.

a

•

Offices

n7

in

97 Cities

'

33

The Commercial and Financial Chronicle

Factors

Influencing Government
Bond Market




.

.,

Thursday, September 14, 1950

Volume 172

economics,

Number 4942

The Commercial and Financial Chronicle

is
buying by
this way.
It is

if

their

From

difficult to
tional

pair

buy 10 cents of addi¬
Either you buy a
you don't.
I would not

Ahead

the point that under certain

argue

circumstances

it

be possible
for a consumer to vary the qual¬
ity of his shoe purchases in ac¬
cordance with changes in his in„

strongly
industry does get

come.
In fact,
that if the shoe

feel

I

larger share of the consumer's
dollar in the months ahead, it will

buying higher-priced shoes.
people

will,

Tne

oath

on Secretary of
Chapman had been circulating around Washington for

At least that long ago I was shown photostats of his
Under Secretary of the Interior in which the clause swear¬

as

other

their

apparel

appurtenances.

standard

part

shoe

of

his

of

and

me.

that

of

to

of

much

see

public's attitude towards
tional.

utilitarian

item

ganic

relation

everything
make

up

Fashion

and

style

to

always

fashion

want

be

may

some

and

some
other
style.
people who don't want either,
buy some other kind of shoes.

would

Carlisle

he

similarly treated.

readily

me

to

the

whole oath when he

silly.

very

The

This

Senator Schoeppel has been made to look
are

increase in these

see any

creased

the

military

expenditures

goods such

televis;on

sets

am

buy

rather

he

never

to

the

made his

charges stick.
My resentment to Schoeppel's charges is sincere

shoes,

more

better

generally
than

will

and

want

only when they have
better everything else to go with
ones

them.

According

to the
Purvey
of
Business, personal sav¬

Current

ings

took

sharp

a

prove'7

business

in

upturn

of this

Quarter

second

as contrasted
indignation which the Left-wing propagandists are
But it is not based on any smearing or wrongdoing
great and innocent man.
Chapman's peace of mind has not

of

°

Power

expenditures.
started

too

end

quarter tp have been the
the

increased

general
their

savings.

tion

goods

Nearly

every

I

have

ington
nan.

as

a

known

him

fairly well

ever

since he

came

thwart them.

the New

Deal.

I have

as

the

other

appropriate agencies approved

companies for projects, only to have Chapman

When Congress asks him about this he will

the

J. A. Warner Retires

Joseph F. Jordan Go.

As Pres. of Firm

Formed in Mass.

a
(Special to The Financial Chronicle)

never

once

entertained the idea.

political thinking, he is

one

a

which

does

right

to

mean

his

pursue

that

the

But to me, to my way

views

American

and

mean,

people have

a

ways,

wages

—

Joseph

F.

dan & Co. with offices at 16 Cabot

Street to engage

in the securities
business. Mr. Jordan was formerly

but

right to and

with

If he had his

and

all of the people would be subjects of the government, draw¬

ing their

Mass.

Jordan has formed Joseph F. Jor¬

of course, that he

bureaucratic

should get him and his kind out of their government.
way,

NEWTON,

of the most dangerous men in the

Washington government, which does not
hasn't

J. Arthur Warner has retired

Boardman,
Richard

J.

prior thereto for

Freeman
Buck
many

&

&

Co.

Co.

with R. H. Johnson & Co.

from the government, their water, their electricity,

Co., Incorporated, 120 Broadway,
York
City. The firm will
continue its investment business

New

exactly
It

and

years was

This announcement

is

not

an

ojjer oj securities jor sale

or a

is

election

as

before.

understood
of

the present

officers

that
is

time.

September 14, 1950

pushed

2,150,000 Common Shares"

f^funp-

Par Value $1

(Canadian)

per

share

the

stated

briefly why I do not expect to
much

change

shoes

"ced

in

the

see

n-irv-ber

discarded

and

up

rather "consumed").

but,

If higher labor and materinP costs
force

rVe prices up, I would

pect to
and

would

I

,

'
■

'

*of which 215,000 shares are

:

v.iUt
'

•

/

i • M ' '

being offered in Canada by Wood, Gundy & Company

Limited

and certain other Canadian Underwriters.

ex¬

spent, for s^oes,

more

see

Superior Oil of California, Ltd.

(Incorporated under The Companies Act, 1934, of Canada, as amended)

of
an¬

nually fie., not neces^arilv "pur¬
chased"

Canadian

reasons

not

anticina+e

con¬

nrice resistance unless shoe

sumer

prices should get markedly out of
line,; People will buy what ihey
need,

but

to

purchase

that

the extent

larger

quantities

they
than

they have been buying during the
last two and

it js

a

fairly

anticipating
shoes

half

clear

they

i.e.,

needs,

of saving

mstead

are

saving

money.

~

,I do

believe

not

that

share

United States Dollars

I think-,

years.

that

Price $10 per

this

has

Copies oj the prospectus may be obtainedJrom the undersigned (one oj the underwriters
named in the prospectus) only by persons to whom the undersigned may
legally ojjer these securities under, applicable securities taws.

taken p7ace to any great extent as

yet.

yWain,

information

the
is

in

no+ed

we

a

available

only

fragmentary.
As
recent
bulletin,

chain store sales of the
larger chains, increased from 3%

■.'4:

July
to

12-

over

large

nart

ported

was

of

July,
the

1949,

but

increase

a

Dillon, Read & Co. Inc.

re¬

undoubtedly accounted
.

for

bv

included

hosiery
with

which

sales
shoes.

TMs

gests that shoe buying

Continued

was

on




are
sug¬

not at

page

27

\

.

f1»'

<

no

new

planned at

solicitation oj an ojjer to buy securities.

New Issue

point where

a

as

President of J. Arthur Warner &.

of

they preferred to save a consider¬
of the additional income
rather than to spend it right then.
A good deal of saving is merely
postponed consumption.
have

smile at

and it will be the end of that.

to Wash¬

thought of him

never

and

-

Federal'

first, but if the questioning gets persistent he will bare his teeth

subordinate bureaucrat, with his buddy, Baldy Bran-

early in

Commission

able part

I

in their

year

do the work, they should be permitted to do so. But.

can

War

cause

put

they seek to make it plain that wherever private

People in

for

to

up

policy of Congress.

the

of

had

apparently

expenditures

the

and

Korean

the

With

install public power over all the land.

consumption

The

near

his main objective.

Im¬

^«qr.

conditions

personal

not

plans of private

up.

higher incomes were reflected in
higher savings rather than in in¬
creased

out of business and
is

are

There have recently been two instances in which the

out.

fake

working

of

m0-pv

save

companies

Chapman goes right ahead with his determination to squeeze them

Commy,

people

correct,

power

and cunning of a zealot he is determined to

companies

hope of offsetting the Hiss case and more so,
political capital that Senator McCarthy made notwithstanding

automobiles,
If I

believe he has done exactly

mostly they

it is worth with the

refrigerators

as

and

may b° somewhat curtailed.
would

at

time that the production

sa^e

of hard

He feels that

in the West with his re¬

power

the

being played in this country today, I doubt seriously that Chap¬
man privately has
any complaint.
He has acted much worse, but
Wiui more eifectiveness,
against his opponents.

extra pairs just because consumer
incomes will be swollen by in¬

private

set-to with him,

propagandizing the fiasco for all

occasionally that does not eventu¬
ally get worn out. but I would not
expect to

his shoulders, show

what?"

boxing.

them

The Left-wingers

so

hydroelectric projects to defy the members of the

branch and

become Secretary.
The charges have, of course, been exploded

Bargeron

square

this, and they usually confine their crossing him to mere shadow

suffered in the slightest, he hasn't lost a single one of his friends.
In the viciousness with which the politico-ideological game is

an

and

legislative

made

was

built up enough political

clamation

this would be done.

concede that
"extra" pair sold

there may be

has

the persistence

and

other

But

I

became

he will

Chapman side and ask: "Well,

Undersecretary but could by the time he had

life.
this

pattern but they do not change it.
who want
fashion
and

style

scribed

to

People

style: albeit, it
fashio->.
and

was

the other

the second

or¬

of
into

fit

should be de definitely cornered

more
thorough
particularly he should check as

Chapman's oath when he

year

changed, that he could not truthfully have sub¬

goes

else which
people's way

of the photostats

a

foot¬

the
has

it

that

whether

make

func¬

a

Chapman abides by them only when they fit his policy,
after year, he and his assistants are hailed before Con¬
gress and asked why they did this or did not do this and he will
slip away from the interrogation with the facility of an eel. If he

Apparently
part of the oath in this instance had
been retained which caused Schoeppel's sugg e s t i o n
that
Chapman's
affiliations
had

like

completely ignores

wear

better

had

He assured

a

To expect
change in the

a

he

Secretary of the Interior

is

living,

part of his way of life.
to

I cautioned the possessor

check and that

and

satisfaction

standard

friends in official

operate.

by force, had been stricken out. And
strangely enough they only mildly interested

person's

A

more

Particularly does he

Congress passes laws under which the Interior
the other agencies of the government, are supposed to

as

ernment

most

from

he.

Year after year,

well

as

ing that the affiant did not belong to any or6u..i^uun advocating overtnrow of the gov¬

sepa¬

rately

than

life

have them
the Washington newspapermen, regardless of their political
persuasion, and he has them on both sides in Congress. He reminds
me a lot of Henry Wallace in the early New Deal years when his
goodness seemed always to exude and any suggestion that he could
not be the perfect man he was touted to be, was received with
jeers and derision.

charges which Senator Schoeppel sprung

the Interior

few bureaucrats who have

are

semi-official

among

three months.

Not

because

people do not think of shoes

and

By CARLISLE BARGERON

be principally because expanding
incomes will result in some people
many

There

of the News

may

a
.

food, their thinking. He would undoubtedly try to treat them
well, too, giving them plenty of everything they needed. He is, in
short, an unusually capable, power-seeking bureaucrat, believing
without question, that the people would be better off under this
sort of a set-up.

Washington

shoes.

or

7

(991)

shoe

work

consumers

.

certainly

it

but

questionable

.

.

8

The Commercial and Financial Chronicle

(992)

possible.

Truman Outlines

It

capacity

to

terials
and

he will
sary.

Harry S. Truman

on

Sept. 9 delivered his second radio
address over all major networks,

With

ing

United

States

double

its

the

have

control

given...;, J

powers,

him under the

acted National

Defense

z. :\

Pro- re¬

duction

#L

s]

Act.^

-,r

>

that,

1;]

In his address,

pro-

program

.

duction of de-\

materi-; "
involving - -1
by next June r *'
outlays
for
President Truman
military pur¬
poses
aggre-"
; "
gating $30 billion, with more to
urged also adoption of
taxes-to put the nation

higher

basis, along
of economic

pay-as-you-go
the imposition

with

achieved

be

many

the

on

farmers,

text

of

the

address

follows:
Last
about
forts

to

maintain

the

you

ordinarily

that

being,

lutely

the

tanks
are

world

from

munist

our

economy

other

needed
the

abso¬

and

guns

and

which

make

to

that

sure

out

and

in this great
But, for the time

have

we

home

to

support

and to

which

fighting
strength

our

build up the

the

free

world

needs

deter Communist aggression.
The leaders of Communist

perialism

have

great

forces

their

to

to

planes

supplies

protect

threat

of

the

Com¬

gression,

in

spite

of

military
They

these

free

nations

but

to

circumstances,
have

build

strength

no

needed

to

military

support

rule of law in the world.
this

way

can

Communist
sion will
To
our

do

leaders

not

Only in

convince

we

the

that

the

part

for

must

and

produce

equipment

the

needed

must

pay

the

raise

the

of

cost

our

increased defense efforts.

Third,

must

we;

in¬

prevent

flation.

Solving these three problems is
challenge we face on the

home

front.

them

if

And

we

freedom

are

and

we

to

the

must

solve

preserve

our

of

the

peace

ing the materials and equipment
need

we

that.

TRADING MARKETS

for

defense.

But it will

To

our

meet

pand

these

total

will

require
longer hours

Charing Machine
Standard Ry. Equip. Mfg.

will

It

demands,

,,.we

we can to ex~

production.

harder

work

This
and

and

older people.

that

expand

ities, develop

business

This

Government
financial

and

productive

facil¬

new

York

Stock

York

Exchange

Curb

York

New

New

Exchange

Cotton

And

Scott, Horner &
Mason, Inc. *■. ;
LD




N.

Y.
'

to

"

11

that

sure

of

other

Cotton

great
&

wasser

Illustrated

advances

Co.,

San Francisco 4,

—

Lauter-

Sutter

145

showing

parison

the

Averages

com¬

thirty listed

and

the

over-the-counter
used

in

the

to

of

I

have

also

en¬

non-essential

thirty-

National Quo¬

War

Time
Controls—Weekly
giving reports, forecasts
and
backgrounds — Special
13week
trial
subscription
$4.50—
Kiplinger Letters, Room 32, 1907
K

Street,

D.

N.

W.,

Washington

these

Execu¬

an

defense-

new

production powers.
granted

by the

coordinated

The adminis¬

the

will

be

Chairman

American Marietta

randum—Wm.
150

the

Security Resources
Mr. W. Stuart Symington.

Board,

have

directed the

these

agencies to

production

large and

r-

paramount

purpose in mind:
To produce the defense equipment
need

rapidly

as

second

problem

is

is

to

increased defenses.

our

only

this.

possible.

as

sensible

one

is

Wellman

on

randum

Co.,

a

memo¬

Engineering

Aviation

—

Corp.—Memo¬

Shearson,

Hammill

&

Co., 14 Wall Street, New York 5,

There

to

way

do

plain, simple, direct
We should pay for them as

go, out of taxes.
very

&

Reynolds

Co.,

Co.

Metals

randum—Reynolds

York

120

—

3c

Memo¬

120

Co.,

5, N. Y.

U. S. Thermo Control—Analysis

—Raymond

Co.,

&

148

State

Street, Boston 9, Mass

COMING
EVENTS
Field

Investment

In

reasons

for

Sept. 14, 1950 (Des Moines, Iowa)

the

Investment

Nebraska

and

Iowa

Bankers Association

Field Day

at

Wakonda Club.

(New York City)

14, 1950

Curb Exchange

York

New

Tournament

Golf

Garden

City

Co.—Analysis—Ira
Ill

Haupt

Co.,

&

Broadway, New York 6, N.-Y.

Also

available

is

a

bulletin

on

Central States Electric.

Chicago,

Country Club, Garden City, L. I.

(Philadelphia. Pa.)

Pacific

&

St.

Paul

Railroad—Analysis—

Dreyfus & Co., 50 Broadway, New
York

4, N.

Y.

Cockshutt

Company, Ltd.

to

pard,

Francis

King

shares—Lam-

common

&

Street,

Company,
Toronto

1,

Philadelphia Field

Day at the Manufacturers Coun¬
try

Club.

Sept. 16, 1950 (N. Y. City)
Association

Street Annual

Picnic

Grounds, Staten Island.

Outing

of

Club

Pittsburgh

at the Long Vue

Fall

Country

Club.

Sept. 26-30, 1950 (Virginia Beach.

Ltd.,

Va.)

Ont.,

National

Canada.

Wall

of

Outing at Reinharts'

Sept. 22, 1950 (Pittsburgh, Pa.)
Bond

Plow

—Current report with special ref¬
erence

Bond Club of

Cashier's

Milwaukee,

the

at

Sept. 15, 1950
Central Vermont Public Service

66

good

Bros.

Broadway, New York 5, N. Y.

N. Y.

pay

It is the

are

Co.

Wall

1

Parke, Davis & Co.—Memoran¬

dum—Sutro

Sept.

These

small.

will be administered with

powers

we

&

of every resource of American

'business,

Co.,

Co.—Memo¬

Mericka

available

Bendix

powers

vigorously and promptly, making
use

&

Co.

National

I

J.

Broadway, New York 7, N. Y.

Also

of

law

new

by

Manufacturing

—Bulletin—Cohu

6,

order

exercise

Corporation.

Orangeburg

C.

authorizing the appro¬
priate agencies of the Government
to

j

Bureau

randum

today issued

*

-

analysis Of

industrial

letters

civilian goods that use up critical

tive

Oil

an

Averages, both as Broadway, New York 5, N. Y.
to yield and market performance
United Shoe. Machinery
Corp.
over
an
eleven-year period—Na¬
I.
du
tional Quotation Bureau, Inc., 46 —Memorandum — Francis
Front Street, New York 4, N. Y.
Pont & Co., 1 Wall Street, New

materials

It

of

brochure-

prevent

raw

defense.

^

Ine—

Street, New York 5, N. Y.

industrial stocks used in the DowJones

analytical

available is

Also

Sinclair
/

Street,

up-to-date

between

Sons,

Street, New York *5, *N; * Y.
.'.

Calif.

an

Corp., Ill

Eastman, Dillon & Co,, 15 Broad

Over-the-Countcr Index—Book¬ I
let

Co.—Memoran¬

Lowensteim &

M.

;

Western stocks which have shown
very

Inc.,
Cope-

Broadway, New York 6, N. Y..

Is It Listed?—List of 25 unlisted

-

Neville

Leece

dum—Aetna Securities

Utilities.— Analysis of
H; i Hentz
&
Co., < 60

Street, New York 4, N. Y.

and

priority,

top

power

production

the

extent

defense

our

now,

During
rowed

in

the

World
too

'

sociation

our

of

II,

and

not

of financial

Trade

Exchange

Exchanges

Exchange Bldg.

DETROIT ;.! PITTSBURGH

GENEVA, SWITZERLAND

Co.,

61

Security

Annual

Traders

Convention

As¬
at

now.i

run

Inflation

than

effort

few, arid hurt the

—just and

higher

would

equitable

6,

Also
on

available

Standard

are

the

Taxation

taxation—is
on

Gas

Transamerica
&

struments,
C.

page

25

12, 1950

Oct.

&

memoranda

Electric

Herbert

26-Dec. 1, 1950

(Hollywood,

Fla.)
Precision

In¬

Pfd.—Memorandum—
Onderdonk

Gas

Club.

wood

Nov.

Co.,

165

Broadway, New York 6, N. Y.
Laclede

Annual Col¬

Club

Day Outing at the North-

and

Corp.

Heintz

(Dallas. Tex.)

Dallas Bond
umbus

taxes

benefit

many.

Continued

&

York

N. Y.

Jack

long

Hutton

New

the Cavalier Hotel.

basis.

Furthermore, if we tax our¬
selves enough to pay for defense,
we will help to hold down
prices.
Inflation would hurt us more in
the

F.

Broadway,

tax

not

Hydro-Electric—

Memorandum—E.

bor¬

must

defense

present

debt.

we

did

We

taxes

enormous

national

enough.

that kind

an

International

finance

we

out

War

much

ourselves

Inc.

that

effort

will avoid

we

Exchange

Exchange,

Board

NEW YORK 4, N. Y.

CHICAGO

33

the

enable

ables the Government to cut down

on

Chicago

New Orleans Cotton

83

make

hoarding

essential

run

Commodity

LY

will

to

the

ernment

increase

Members

Dan River Mills

Tele.

also

York

Lomasonu

this.

1856

H. Hentz & Co,

Rich., Fred. & Pot. D. 0.

men

purposes.

orders have

There
Established

New

IIIIIIIIIIflllfllllllllllllllllllllfllllllH

law

—

New

&

Win¬

on

Plywood

Refrigeration.

manufacturers get the
American Enka Corp.—Memo¬
steel, aluminum, copper, and other
randum—Kirchofer & Arnold As¬
materials they need to fill such
sociates, Insurance Building, Ra¬
orders.' This law gives the Gov¬
leigh, N. C.

we

Natural Gas Co.

business

to

reports
14
in¬

in

the

special

provide

help

of

enable

and

stocks

land

that

way.

Alabama-T Qnnessee

Lynchburg, Va.

to

Act

where that is necessary to enlarge
the production of our mines and

To

Trading Markets

will

factories for defense

for

techniques, and
increase efficiency in every way

Tele CG 146-7

IIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIM

law

law,

new

a

Production

men

Street'Chlcago 4

Tel. DEarborn 2-5600

1950.

Our

Members of Midwest Stock
Exchange

209 S. La Salle

Defense

■one

for

means

should

KiiIUt&Co.

Production

Defense

Yesterday, I signed
the

exercise

everybody.
It
additional
jobs
for

mean

women

do

can

economy.

everything

our

We

impose great new
the
productive

upon

of

must do

Durez Plastics & Chemicals

of

tration of these and other powers

world.

Beaver

stocks

materials.

the

situation

done five

Act

the

First is the problem of produc¬

in

Provisions

the
we

to

money

demands

A.

tough

defense.

Second,

power

William

hard,

meet

Electric

t

tation

defense

must

aggres¬

building up
strength
and
the

military

three

we

materials

pay.

our

we

problems.

the

alternative

the

up

job,

solve

and

the- united

opposition of all the free nations.
Under

this

do

initi¬

own

certain steps

are

see
that
the- job .-is
promptly and well.'

This

Three Tough Problems

To

their

on

But there

Government

comand.

at

have shown that they are
willing
to use these forces in
open
ag¬

job

defense pro¬

ratings

177

East 44th St.,
17, N. Y.

and

can

to

domination.

First,
im¬

do most of this

ative.

citizen

every

I want to talk with
you about what we must do here
at

Management and labor

better life

a

Tonight,

men

changing over
to defense production is a chal¬
lenge to our free economy.
-

all-out

an

We have not

goal of

up our

be

cannot

we

effort by everyone.

given

and

which the Government must take

satisfied with less than

ef¬

freedom in the world.

facilities

and

or

the free world faces

great

so

and

peace

we

earners,

families.

The danger

turns

week, I talked with
Korea, and about our

business

expect to have for ourselves and

country of ours.

•

.

full

This' job bf building new plants

new
sub¬
four
weekly

data

are

Crampton,

Si

Douglas

to

5

vey,

This
fast

place

take

cannot

enough.

defense

basis of

ters

plus the Chemical and
Drug issues — $5.00 — Department
CF-2, Value Line Investment Sur¬

need now from

we,

offer

of

covering

our

expanded production alone.
expansion

will

is

underlie

to come.

l\ave' to

years

Also available

estimates

trends—special in¬

includes

editions

cannot get all the mil¬

we

duction

for

'

•

But

business men—must give up some

our

troductory

strength.

itary supplies

of the things we would

curb

inflation.

defensive
,

which

morale

Therefore, to the extent
necessary,
.Workers- ,nnd. plants
will have to. stop /making some
civilian goods: and. begin turning
•out military equipment.
:

prepared 'to

wage

or

controls, including price and wage
ceilings, if deemed necessary, to
The

$15

All of us—whether

usual.

as
are

He

come.

about

and

very ;strong

specific

Fabrics—Information—
Securities

Corporation, 111
Broadway, New York 6, N. Y.

dustries

we can arm

We

.

bringing
probable

scribers

This defense program cannot be

als,

a

for

Hrli

•

fense

on

a

and

the
than

more

probably

must

we

maintain

fox-.:

greater

shall

ports

ourselves and

Lea

Aetna

issue of the Value Line Re¬

page

,

growth,

for defense. We are

year

we

And

-^1

the

stressed

a

..

.

.

Chemical Drug & Liquor Stocks
the
semi-war
economy—56-

na¬

spend much more than $30 billion.

President

need

.......

efforts.

spending

in

by 1954 will undoubtedly be
far surpassed*
With
this
kind
of
dynarriic
omy

stepping up this I'ate rapidly.. *
By next June, under our pres¬
ent plans, we expect to be"spend¬
ing at the rate of at' least $30
billion a year.
In the year after

*

en-:

recently

the

billion

last year of $300 billion econ¬

set

firms mentioned will be pleased
the following literature:

interested parties

produc¬
of ap¬

rate

help arm the free world. We can
improve our industrial plants and
maintain
the
civilian
efficiency

must

defense

been

annual

send

to

faced.

are

we

economy now

an

It is understood that the

to meet the con¬

more

our

at

Recommendations and Literature

be expanded a

can

proaching $275 billion, the goal I

military strength of the free
tions throughout the world,

outlining his plans for executing

Dealer-Broker Investment'

productive

ditions with which

;

President

as

ability is
greatest in the history of the

great deal

Set» op a coordinating
and an economic stabilization board. Proposes vol¬
restraints by business, labor and public, and asserts
invoke wage and price ceilings only if deemed neces¬
Says war preparations should be on pay-as-you-go
basis, and urges excess profits tax.

untary

such

world, and it

operations and forestalling inflation.
agency

produce

copper.

the

plans for expanding military

Thursday, September 14, 1950

i.

means

America's

Impending Conliols
President in radio talk tells of

enlarging our
basic ma¬
steel, aluminum

.

Company—Anal¬

Investment Bankers Association
Annual

Convention

at

the

Holly¬

wood Beach Hotel.
Dec. 8, 1950
New York

(New York City)

Security Dealers As¬

ysis—Edward D. Jones & Co., 300

sociation Silver Anniversary Din¬

North

ner

Mo.

Fourth

Street, St. Louis 2,

at

the

Waldorf

(Starlight Roof).

Astotia Hotel
*1,

.,

Volume 172

Number 4942

..

.

The Commercial and Financial Chronicle

(993)

than it collected in

more

Korea and Taxes

tire

and

President, Koppers

higher taxes and

as

be

and

World

War

II

which

the cost of defense prepara¬
tion and he has stated that he will

in good faith to reduce
tary establishment. We
the

assumption

nations

of

world

that

out

cost

mili¬

our

war

went

the

on

Some

war

wanted

it

to

justed

than

by netion —

g o t

i

that

no

a

and

curity for
where

Gen. Somervell

Russia and her

did

it

and

much

the

held

and

tide

did

it

We have embarked
which

back.

there

plain

and sys¬

difference
few

a

and

sources,

is

course

a

turning

no

of all three is not

so

re¬

be

supply

our

great that

military

quire

many

planes,

In

weapons,

equipment

World

New weapons,

War

it

an

improved

new

all

of

II

to equip

per man

took
army.

weapons,

of equipment for to¬
divisions, have raised that
to the point where it is estimated
that to re-equip our army to cope
with
today's military
problems
will take a figure more
in the
neighborhood of $4,250 per man.
The

for

amounts
men

still

are

the

sailors

of

There

a

anyone

government

war or a.

World

method.

fighting

is

the

simply

winning fight in

a

Korea, plus rebuilding the United
States to the position of a firstclass

military
power
whose
strength and striking power will
be

respected

from

Moscow

three

of

billions

the

cost

They

We

can

II

it $170

period

years

billion
two

of

fighting

our

this

used

we

to

go

a

with

than

bullets,

wound

and

Cost

Let's

Can

Be

Met

it

ended

we

together then, for a
we are going to
of this challenge.
Let's look together at the subject
meet

the

of this
The
♦An

fore

talk, "Korea and Taxes." }
last war,
World War II,

address

the

how

cost

by General Somervell

National

Tax

be¬

Association, Pitts¬

burgh, Pa., Sept. 11, 1950.




Unless

willing

are

we

take

better decide
ica

solvent

we

without,

able
able
bled

is—how

much

that

agree

we

are

we

on

all-out

war.

domestic civilian

as

to

entirely

that

assume

once

ac¬

other

for

tion

all-out

war

could

if

we

were

more

than 80%

penses

to

not

do the

can

carry

out

ment

de¬

program

Are

our

same

announced
and

take

rearma¬

of

care

A

planning to?

we

One

last, the President
"pay-as-we-go" pro¬

a

Congress
billion

to

for

for

an

This

announcement

is not

and

this

understand,

don't

year.

to be based

if

government

spending

on

on

Federal

our

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

this

tremendous

debt.

It

government

it,

if

the

should

for,
it.

would

them

for

be

them,

people automatically do
and this type of need

not

even

I

told

government
it

be

denied

or

than

more

whole

the

government

the

cost

Federal

people

not

am

talking

about

Borrowing to
been

The result of this

is

that

quaint

more

though
were

only

war

five

that

of

years.

constant

been

our

years,

those

The

non-war

on

result
debt

$40,000,000

Tennessee Gas Transmission

Company

method

has
fi¬

of

War

Due September 1,1970

September 1, 1950

taxes.

World

72%

Price I0l3/i% and accrued interest

only 23% with

money and

for

paid

Dated

Pipe Line Bonds, 3% Series due 1970

paid for 77% with bor¬

was

rowed

First Mortgage

War I

with

was

borrowed

money and 28% with tax money.
In World War II we made a real
effort to put that war on pay-asbasis and managed
to

we-went

45%

pay

the

of

costs

The

through

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

taxes.

After each of the earlier

combination
the

national

and

the

of

the

wealth

will to do

wars

increase
of

so

a

in

HALSEY, STUART &, CO. INC.

America

enabled

us

Extravagance

Since

A. G. BECKER

BEAR, STEARNS &, CO.
COFFIN

DICK

BURR

&

Since

1945

has

there

prosperous

ernment

has been

ing

people's

the

uries

that

the

&

INCORPORATED

&,

has

not

been

seen.

years
so

During
our

gov¬

busy spend¬
on lux¬

reduction

in

1945 until the; end

collected a
billion in taxes.

government
$201.6

& CO.

L. F. ROTHSCHILD

AMERICAN

&

SALOMON

CO.

SECURITIES

CORPORATION

BROS. &

WERTHEIM

& CO.

HUTZLER

GREGORY & SON
INCORPORATED

WEEDEN & CO.

AUCHINCLOSS, PARKER &, REDPATH

STROUD & COMPANY
<;

BACHE &, CO.

INCORPORATED

HIRSCH &, CO.

INCORPORATED

WM. E. FOLLOCK

&

CO., INC.

PUTNAM

&, CO.

F. S. SMITHERS & CO.

money

total

of
fiscal 1950 was only $1.3 billion.
Yet during this same period the
year

& CO.

R. W. PRESSPRICH

CO.

WILLIAM

BLAIR

&

COMPANY

COOLEY & COMPANY

total

This

of

is

R. S. DICKSON &, COMPANY
INCORPORATED

the national debt from the end of
fiscal

HALLGARTEN

MERLE-SMITH

OTIS

HAYDEN, STONE &. CO.

prosperous years

ever

BLAIR, ROLLINS & CO.

.

(INCORPORATED)

generation, but these have been
the most

CO.

INCORPORATED

1945

a

&

INCORPORATED

THE ILLINOIS COMPANY

September 12, 1950.

STERN BROTHERS &. CO.

AJ

SWISS AMERICAN CORPORATION

of
has

rose

page

buy these securities.

al¬

years

over-spending

Continued

to

reason¬

government has
than it has taken in
our

in 19 out of the past 21

in

pay war costs

one

war

expenditures.

1932.

always

waited

if the people can't afford

costs

This is

and,

more

This
theory
the principle

the

has

an

The

can

people ought to have
something and would like to have

recently asked
additional $16.5

defense

I

each

thinks

this

President

then,

deny them¬

somehow

go

seems

gram.

The

the

government itself

our

thing

more

spent

Pay-As-You-Go Program

advocated

you

quaint theory in Washing¬

that

ing

On Saturday

basis. The ques¬

worthwhile

the people to

is the

defense budget out of income?

our

war-connected

me

ask

selves when

it,

current ex¬
out of current income.

It seemed

he

the

for defense

revenues

we

If

wrong, go to

one

How in ali conscience

need

these

pay

that

answer

elections?

foot of your class.

then

our

wi 1 this spending

UiUCii

before

pur¬

I are talking about
here today is the extent to which
we

Eow
cut

thing
today? And if we do, would this
not
make it possible for us to

and

you

be

nice

will be much larger than
had planned, they still are not

an

ing.

that
reason¬

through six trou¬

go

using

years

poses,

Therefore,

expenditures

policy of asking Congress to

how

of

can

go?

as we

all

to

had

and

question

1944 they
billion, three

might

Would it not be

try to pay as we
to the greatest possible extent.
pay

what

the

followed

he

revenues e iual to tl.e ex¬
penditures which have been pro¬
posed. But still he goes on spend¬

by

tivities of the government.

trying
we

less

1946

for

in

nor

has

bill

provide

must

keep Amer¬

to

now

let

to

are

the

$8 billion
have been

America

over

from within while

development
tax

than

in

went

regarded

communism

Korean

interim

is not prepared to do so?

.

taxes."

more

appropriations

ton

Yet

ex¬

pay-as-you-go

a

owing

$5,700,000,000 every year.

these

look

moment, at

taxes and

almost $45

on

important thing is that
in his peacetime normal
bill prior to the

neither

1942 peak.

Included in the current budget

America
How

taxes,

..

care

taxes

basis.

were

not taken

until

fi¬

ask

to

before Congress is the interest on

five of

pocketbooks than men.

by

to kill capitalism

there

I

intends

additional

additional defense

our

penditures

and one-half times the

going broke: "There is

one way

were

rose

reached

put

in

$258.7 billion.

rather fire dol¬
rather

only

the

proposed a sure

that

1946.

during this period.
Taxes

We started the war
national debt of $48.9 bil¬

a

lion

may

times

thousand

method of

knew

Marx

he

people which
of

in

$4,946,000,000

remember

serious wartime needs of the

any

basis.

I feel sure that the Ameri¬
people will be for it. We would

lars

when

answer

of

can't

a

will

to

expenditures.

he

sufficient

for
to

said

has

high there seemed to be

so

peace,
can

high of $7,951,000,000 in 1944 to
low

He

costs

buy us an
to pay a considerable part of the
uneasy peace.' a restless peace, at
costs over the following genera¬
an
appalling monetary price, but
tion.
still—peace.
If this vast military
outlay turns out to be the price of Government
peace.

question.' Karl

of the
States an

of $6,400,000,000 annually.
The actual figures ranged from a

this

ask

never

needs

United

the

on

average

becomes

money

would

and

used
a

people's

way
by which we
could meet them on a pay-as-you-

to

We hope they're the cost

war.

of

these

are

the

of

spent

he

possible

Manchuria.
Nor

and

civilian

war

six-year

same

government

our

people

make?

government
worthless

$200 billion, of which

that

revenues

ask for additional

The

domestic,

and suffering brought on when
debts are not paid

ery

through June

During that

period

the mis¬

seen

1941,

expenses

War

For

costs.

repudiated their

One who has

fense

to

resort

current

This

debts.

cov¬

expenditures

$165 odd billion went to pay

country.
it

does

ex¬

Congress

additional

nance

fiscal

that they

means

1,

than

more

the

and

our

the next three years total $120 bil¬
lion. This is not the cost of an
war.

broke

gone

an

nancing.
In the War of 1812 we
paid 57% of the costs by borrow¬
ing and 43% by taxes. The Civil

all-out

in

while

So let's look at bor¬

We

worth.

pointed
is the in¬

our

cover

war

During that six-year period the
government
collected
in
taxes

experience of
countries which have

yet in

seems

rowing.
In

had

in the
in America that

thought

defense effort.

dismiss this.

difference

have

living

we

Although the figures are still in
a
state of flux, the expenditures
currently being discussed by mili¬
tary personnel as needed to re¬
build our military strength over

cost of

What
I

in

years

the

are

government

July
30, 1947.

I

ago

nearly

greatest

These

from

seems

fiscal

told

need

1942 through and including

ered

$5.7

family

should

serious

no

mind

and

formidable.

more

be

our

types

new

day's

air

Let's look at these.
to

no

re¬

each

We

were

will

program

new

new

kinds.

$1,074

Taxation.

we

squander any of them.

Our

for

The

Borrowing.

3.

will

Our strength,
patience
will

taxed to the limit and

can

money.

2.

minutes

alone,

It

most

of

1947, which

owe

what

billion a year.
raise that interest requires an
average of $133 a year to be col¬
lected by the Federal government

go

Printing

which

to defend it from

printing money to pay for either

on

inconvenience

tremendous.

be

return

we
so

six

the

would

period

penditure.

lot of difference.

a

se¬

and else¬
to find that

Korea

are

1.

too

The cost in blood, treasure,
in

who win

men

the

To

point of insolv¬

a

three ways to pay for
defense:

or

has turned

three years of urgent
tematic rearmament.

and

may

we

are

to

from

we

have squandered it at home.

There
war

working vigorously
and energetically to the time when
we shall again have enough. Such
a course will require at least two
we

squarely
turn our

present,

in

us

would

disarmament

to

came

too

Today

soon.

have

to

happy view.

When
we

we

not

seem

same

they

where the

ency

force.

Unfortunately,

the

If

now.

words

two

more

these two words, and the

on

United States to

expensive

satellites

these

all

in

be losing at home the very
thing that our men in Korea are
fighting for today.
It is entirely
possible that we could bring the

vast

armed

Whatever

well

position
a

have

problems

nation

its opinions or
with

differ¬

no

Never

wnen.

they do

backs

needed to back

its

and

needed to be faced

ad¬

be

cold

a

is,

history

fact,

or

makes

war

this discussion.

in

How

either of dogma

hot

a

today in

people say that
to ourselves,

take

to

years

it makes

me

out

Taxes during the

are

every

debt

One

it has to be paid for. The
questions are how and when.

peace,
and
that any world
dif f erences

could

or

ence

we

debt—a

in excess
family in the

difference does it make?

We borrowed the rest.

Whether

into

already is

$6,020 for

this

itself paid for $150 billion of

this cost.

united

the

$320 billion.

further

and

which

United States.

public and business also follow
policy of restraint.
set

substantial

to

some

expenditures

government

tried

of

urges

we

resort

we

back and look at

go

has

terest

Ater

of the been granted. He asked Congress
during for a tax bill which would create
the past war, as well as to look at an additional $5 billion of reve¬
some of the government tax
col¬ nue, and this too is in process. He

en¬

prior

lections. Since all government fig¬
ures are.on a fiscal year
basis, I

debt

an

reduced

the

nation

further

spend¬

threatening to lead to constantly

increasingly burdensome national debt.
Criticizes Administration's spending program and points out
President is not following his own advice advocating "payas-you-go" policy. Cites instances where government spending

can

if

So

Asserting red-ink spending will lead to red government in U. S.,
ing which he denounces

the

borrowing now, we do so when we
already owe $257.4 billion and we
plunge the nation and the people

Company, Inc.

Gen. Somervell attacks Federal extravagance in civilian

of

to World War II.

By GENERAL BREHON SOMERVELL*
Chairman

history

9

34

10

The Commercial and Financial Chronicle

(994)

Credit

all kinds

Secretary of the Treasury

in financial cooperation has been

pioneer activities, despite
in their

ther bank

have confronted

problems which
since the

us

than

ments of the

Woods,

h

e re

the

Bank

and

Fund

had

w

their

begin¬
if

ning.

Bui

the conditions
these

far

been

those
the

as

and

it must

be

situation

same

to all other postwar

Appraisals

cooperative endeavors.
of

dif¬

expected

originally,

that

have

toward our ob¬
jectives must be made in the light
our

of

progress

existing

circumstances

first hoped.

we

the

of

confidence, and

problems with
have made

we

a

Re¬

serve

tion

has not been uniform in alJ

covery

been suffi¬

has

but it

countries,

achievement

the

precedent, as were
adopted
to
achieve

means

those

The

objectives.

success

action
We

the

is

all

to

should

common

international

an

to divert much of our attention

the

which

task

of

that

protecting

have

we

Increasing

won.

pansion.
Thomas

McCabe

B.

Commenting
the

on

expansion
Federal

the

of

Reserve

past

Board

credit

year, the
Chairman

remarked:

"Within
made

the

by

all

past
more

loans

year

commercial

have increased

than

banks
$6 bil¬

owed

the

for

purchase of homes,
has increased $4 billion during the
past

year

than

more

to a present total of
$20 billion. Consumer

defense

instalment

credit

is

up

from $9.4

requirements will

Our
two
organizations
have
pioneered new fields of interna¬
tional understanding, and the ben¬
efits of that

precisely how the changing situa¬

lative

to

pioneering

from

experience

source.

to

year

consequence,

are cumu¬

Each

year.

gain will help

we

deal effectively

yet to be faced.

us

with problems

Each study of

a

development project by the Bank

looking to expanded productivity,
and each consultation held by the
Fund on a monetary, exchange, or
trade problem, furthers our goal
of international cooperation.
The Bank, after its

initial efforts

in the field of reconstruction, has
been

proceeding with increasing
emphasis on development under¬
takings. It has sought to encour¬
age

better utilization of the basic

resources

of its member countries.

The work of the Bank in effecting
loans has been complemented by
a

marked increase in its technical

assistance

The

activities.

impor¬

tance of having available adequate
technical assistance in furthering
-economic

in the under¬
developed parts of the world is
universally recognized.
growth

The Fund has used every means
within its power to facilitate the
creation

of

financial

a

ment conducive to

international

a

trade

and

effective

will

tion

the

affect

activities

of

expansion

the world is held in the

un¬

certainty and hazard, it would not
be reasonable to expect the Bank
and

the

Fund

measure

to

deliver

economic

of

full

the

assistance

closer

ternational payments.

frequently

countries

with

a

It has

with

view to

credit
the

concerted

consideration.

As mechanisms

of international

cooperation, the- Bank and Fund
have contributed to the realization

knows

that

goals, and knows
furtherance of

mutual endeavor is the

right road

over

their

participation

of difficult but

steady

in

in

our

which

the

have

road'

to

shall

leads

International
Monetary
France, Sept. 6, 1950.

Fund,




Paris,

request the Congress for addi¬
authority should that prove

depend

in

our

on

the

establishment

under

the

was

direction

an¬

of

a

of

F.

Mr. Bennett for¬

associated

with

basis. Taxa¬
however, will not do
Parallel and prompt re¬

alone,

job.

in

the

area

of

monetary

they might do in this emergency,
Chairman McCabe suggested the

municipal bond department in the
firm's New York office, 42 Broad¬
Lawson Bennett.

the

give businessmen some
of his thoughts concerning what

Middlebrook, Inc.

the

on

Asked to

Coburn Middlebrook
Coburn &

ultimately

and credit policy is essential."

F. L. Bennett With

way,

Sell-

Stonehill.

following:

(1) That they maintain the ver¬
satility and resourcefulness for
which American business is fa¬
.

mous.

(2) That they do everything
possible to avoid price increases
except where forced to do so by
mounting costs.
(3) That they constantly strive
to improve

With Rockwell-Gould
ELMIRA,

N.

Y.—Charles

Rockwell-Gould
Lake Street.

H.

(4) That their research and de¬
velopment activities be intensified.
(5)

Co.,

Inc.,

labor-management re¬

lationships.

Grund has become affiliated with

167

American

159-

their

they

That
best

men

Government.

make some of
available to the

of $1.50

increased

of

85

payments

such

was

was

du Pont, and as

in

made

comparison

cents.

extends to

prominent

names

Smelting, National Dairy,
Fruit and Kennecott.

National

Oil,

Shell

other

many

as

com¬

Steel,

International

Paper, United
In
been

addition, there

stock

splits such

are

as

where the cash

cal and

These

several

companies

where

payment has been increased.

developments

there

have

Libbey-Owens-Ford and Allied Chemi¬
come

on

of the

top

.

increased

dividend

rates adopted by many

middle

the

the

of

companies at the end of last year. Up until
current year dividend payments- were run¬

6% to 8% ahead of 1949.
Recent increases and
distributions, however, should widen the comparison.
ning

In

spite

would

to be a

appear

substantial

special

B

uncertainties in the outlook, there
growing realization by corporate manage¬

the current

of

ments that stockholders should

receive

some

of the benefits from

investments which have

capital

the past four years as

been

made

over

well as the fact that costs are also increas¬

ing for the individuals and institutions who depend on dividend
income.

dividend increases have been
earnings paid out as dividends is

Although

the

of

percentage

numerous,

still

the

generally

Most companies have maintained a strong financial

conservative.

position and should be able to continue the increased rates under
the present foreseeable conditions.
taxes, of course, represent a major threat to earn¬

Increased

As yet, the final tax measure for the current year has not
enacted, and the likelihood of an excess profits levy for 1951
seems fairly certain.
Nevertheless, most companies should be able
to maintain a level of earnings sufficient to support current div¬
ings.

been

idend

There is also the fact that if construction pro¬
back the cash needs of many concerns will be

payments.
cut

are

grams

greatly reduced.
Over the balance of the year many

companies will be enjoy¬

ing record earnings. The outlook over the immediate future is| for
a high level of business with defense activities
increasing in im¬

Completion of capital expenditures by a large number
enabled them to build up their financial position
many cases cash resources are in excess of requirements.
While the threat of higher taxes may induce a cautious policy in
some cases, we would expect the present trend toward increased
portance.

of companies has

in

and

distributions to continue.
These

developments have special significance so far as they

As large holders of

fire and casualty insurance concerns.

concern

stock, these institutions are important beneficiaries of the
current boom in dividend payments.
In some instances common
common

investments

stock

is

There
taxes

up

received. With the increase in
greater importance.
statements of the major insurance com¬

to 85% of the dividends
half

first

The

amount to 40% to 50% of the total portfolio.
that this income is exempt from Federal

fact

the

also

corporate rates, it

assumes
year

a

that while underwriting operations were not as

panies showed

impressive as the results of a year ago, the

The

income from invest¬

of 10% to 25%.

ments showed increases

explanation for this favorable comparison arises

the enlarged

out of

dividends which have been received and the larger
invested. A gradual increase in premium volume

considerable portion of the record earn¬

plus the retention of a

enabled the insurance industry to augment
funds. A considerable proportion of these resources

ings of last year, has

was

invested in common stocks.
return

able
vious

have

As such income

nant of dividend

sults being
in

the

are now

providing a favor¬
received on pre¬

substantially improved

the

investment

of these companies.

Thus, for the year
levels.

They

and along with the higher income

investments

income

pay-as-you-go

a

tion

straint

nounces

inflation

"Effective restraint of

ple to tax themselves adequately
to meet the Government's needs

cooperation
hopes for the future.

of

payment

distribution

include

and

its investment

necessary.

must

previous

volume of funds

is also prepared to

the

to

goals.
continue to place
our

years

by Secretary Snyder at the
Session
of
the
Fifth
Annual
of the International Bank and

the

willingness of the American peo¬

international

progress to¬

•Remarks

of

along

proceed

which-

achievement of
We

"The Board

been

placed
path will but harden our

determination

ward rehabilitation of the world's

Opening
Meeting

Governors

tional

It is my belief that the new dif¬

ficulties

wood &

back

of

Government securities market.

the

to attain those purposes.

merly

look

to curb inflation,

measures

Board

quarterly

list

The

for

its great

equally

experienced.

can

sup¬

furthering consulta¬ Federal Reserve System and the
Federal Open Market Committee
on prob¬
lems of economic development and are prepared to use all the means
international monetary
relations at their command to restrain fur¬
ther expansion of bank credit con¬
in the years ahead.
One
paramount
fact
remains sistent with the policy of main¬
clear. This community of nations taining orderly conditions in the
sibilities

of the economic recovery we have

We

to

and

tion and concerted action

con¬

encour¬

development

condi¬
In view

rely in major degree for the im¬
mediate future upon fiscal
and

in these institutions lie great pos¬

member]

aging them to regard exchange
and monetary policies as fields for

present

port the Government's decision to

anticipated by their founders. Yet

approach to normal balance in in¬
sulted

this

of

under

at banks
Such an

tions is clearly excessive.

grip of

environ¬

a

leading cities

the Bank and the Fund. So long as

high level of
and-

billion
alone.

$1V2

by

panded
in

beneficiaries of the G. M. dividend
a

the

panies

the

a total of over $47 billion.
Consumer
debt, excluding that

problems,

face

on

expan-

for lion, to

means

proper

common

now

that

situation which threatens to force

to

credit

of

degree

attained

have

we

demonstrate

meeting

straints

immense

without

were

the

government;
and
(3) re¬

has, in large

The objectives

have been historic.

ex¬

of

penses

in

experiment

non-

military

ciently pronounced in most areas
to afford us great encouragement.
This

of

the need for close $40 billion.
"Within the past six weeks loans
cooperation among
and
us is more evident.
holdings of corporate and
We cannot yet clearly foresee municipal
securities
have
ex¬

acter and of whatever

result

the

of

ernors

Federal

inten¬ billion a year ago to a total of
ing them. It is our determination, sify inflationary pressures. These, $12.6 billion at the end of July.
to continue confidently and dili¬ if not accompanied by sound fiscal The
aggregate
non-farm
home
gently to work out solutions to and monetary measures, may ham¬ mortgage debt has jumped nearly
every perplexing question which' per our efforts to carry on with $6 billion in the past 12 months
we
encounter, of whatever char¬ the tasks which lie ahead. As a to a present total in excess of

considerable advance toward solv¬

the main

quate taxes;
(2) the reduc¬

us

We have met our

Some of the more spectacular declarations include the $2.50
special payment of General Motors, indicating total disbursements
for the year may possibly approach $10.
Chrysler also recently
declared a specal distribution amounting to $3 a share.
One of

with

Gov¬

Week—Insurance Stocks

dividend

months.

of

verely from the war have now
markedly strengthened. Re¬

most

JOJHNSON

payments have been among the most
prominent features of financial developments during the past few

a

Board

been

rather

than the circumstances for which

This
Increased

McCabe,

B.

se¬

suffered

which

nations

international co¬
operated for operation and helpfulness.
The
the
past five decisions which produced these
of
cooperative
effort
years have measures

John W. Snyder

recalled

Chairman

fact that the economies of the free

institii-' part, been the fruit of an

tions

has existed

Thomas

7

confidence in the

We may take

under which

for

past year, and to ex¬

Sept.

on

Washington

in

System,
urged as curbs
to inflation,
(1) the levy¬
ing of ade*

fore¬

Bret-

at

ton

hoped

exchange adjust¬

National

the

before

Executives

more

was

seen

from

the

to

measure

talk

a

Sales

been panding production in many coun¬
tries, we have seen a significant
d i f f icult in improvement in the payments po¬
many respects sition of many countries.

much

ferent

Due in large

economic structure.

have

They

indeed.

ficult,

have proved dif¬

war

credit expansion.

path.
In

financial

and

economic

The

market" to restrain fur¬

curities

By H. E.

inflation threat and

as

conditions in the government se¬

difficulties placed

new

Reserve

"consistent with
policy of maintaining orderly

the

achieved and both International Fund and World Bank must
continue their

Thursday, September 14, 1950

increase in loans of

calls for powers

Secretary Snyder asserts, despite current disturbed interna¬
progress

*

Bank and Insurance Stocks

Expansion

Federal

of

Chairman
cites recent

By IION. JOHN W. SNYDER*

situation,

.

McCabe Warns of

Progress in International
Financial Cooperation
tional

.

investment earnings should reach record
in the past has been a primary determi¬

policies,

we

would expect that the favorable re¬

achieved in this end of the business will be

dividend

reflected

payments of insurance companies between now

and the end of the year.

Volume 172

Number 4942

.

.

.

The Commercial and Financial Chronicle

(995)

above

How to Meet Government

savings
the

of

Mortgage Compeli ion
ment loan

(3)

U. S. Savings and Loan League. Chicago

essentials in meeting and

as

beating

level;

(2)

period

increasing

increasing percentage of amount

of

loans;

urban

government
to

meet

will

be

home

con¬

mortgage

competition and how

it and beat it.

Primarily.

government

of loan

of

consists
VA

4%,

30-

guaranteed

or

the

monthly

cans

2%

tle

made

the

by

governt

on e n

direct;

and

F H A

4V4%

(43/4%

cost

to

the

25

loan,

than

of

percentage

risks may
true, then

petition,

risks

against the

serves

in order

same

able to meet and

be

0

should simply measand provide,, re¬

we

those

competition.

beat

It

gage Association with resources of

far.

$2,750,000,000

is

types

of

such

numerous

be

loans.

There

variations,

discussed

in

which

are

may

question

pe¬

look

our

the

riod.

20

or

urban
and

should

we

home

mortgage

what

see

The

volume

$40

billion.

this is VA

FHA,

the

debt

About

$9

and about

leaving

The

is

is.

about

billion

tions can,
meet

$25

billion
vol¬

current

of lending in recent years is
about $11 billion per annum, and

ume

about

billion

$2

about

and

about

of

$2 billion

this

is

VA

is FHA and

billion

$7

with

loans

at

petition,

whether
meet

not

or

shall

we

try

beat

government

It

possible

or

petition.

is

to

to

com¬

ness

making

conventional

6%

or

the

for

its

it will lose

money,

of the market and

cream

will

that

to

com¬

home

it desires to do

make VA 4%, 30-year,
100% loans, or FHA loans, or con¬

pattern,

yield

a

of

loans

less

dividend

a

than

2%

and

at

of

rate

not

money

words, if
is avail¬

able

at

long

terms

best

personal risks and the best
will
obtain
such

4

to

43/4%

in

and

great

for

very

volume,

the

is from

reserves

This is
and

to

1

Up Reserves

to

associations

our

Tf

this

to

full

a

and will build

can

is done,

10%

provide

of

assets.

face the
They can
offices, equip¬

they

can

confidence.

adequate

facilities, personnel, and
service, including advertising. If
these
things are done, manage¬

ment and

pier

employees will be hap¬
it is certain that the

and

customers

will

be

agement

of

business

should

fact

that

prime

the

in

overlook

not

the

security

are

compelling considera¬

the

institutions.
the

Man¬

sayings and loan

safety and

and

tions

happier.

operation

of savings

This is recognized by

serves

have
for

is

of

safely

served

and

securely

than two generations.

more

by the insurance
likewise.
Commercial

companies

a

rate of
Furthermore, it is
grave question whether savings

and

conventional

6%.

associations

loan

<

leaves not

and

We

their

funds

employed

rates

at

higher than such a great volume
of
government competition, and
shorter-term loans and at lower

on

rate

2Vz %.

or

in

excess

a

dividend

From 30

I

of the

am

ford

to

class

mortgage

into

and

how to
beat government mort¬

and

competition.

loan

gage

essential
to

is

43/4%
the

make

to
so

meet

that

The first

the

we

government

rate

can

of

either

facilities

conventional loans in

or

by

Mr.

Russell

com-

62nd Annual Convention of the

before

the

New York

Savings and Loan League, Saranac, N. Y.,
12, 1950.

Sept.




by

thrift

on

They

in America

such

fact.

business

Our

financial

must

for

the

recognizing

savings and loan

presently organized is

as

comparatively
of

now

are

young

in the family
We

groups.

recognize

facts

the

The welfare of

our

local

simply
life.

of

commu¬

and

a

home

It is completely dem¬

that

(1)

thrift

is

promoted

convenient

savings
account, (2) safety, (3) rate, and
(4) advertising, in that order. Rate
is

not

ment

a

the first
to

second

or

saving

great
responsibility in every
state, especially in these times, to

promote thrift habits in American
families.

It

best

can

indicated above.

done

as

cen¬

will show about 55% of Amer¬

sus

ican
in

be

The current

a

families

owning

equity

any

home, and about 45% renters.

These

figures will

be

much

favorable in some states.

the

more,

housing

less

Further¬

will

census

show far too many families

living

in sub-standard

homes, especially

in

It is admitted

some

all

states.

students

home
for

of

the

ownership is

too

many

good thing,

reasons

to

mention

here. A program as outlined above
will

undoubtedly
homes.

home

promote

ownership

loan business has for

A

savings

May

15-weeks

Benjamin Graham
course

invest¬

on

ment

problems taking into account
post-Korean war, economic and
political

factors,

threats

newed

including

re¬

inflation,

will

of

begin at the New School for So¬
cial Research Sept. 25. The course
will

be conducted by A. Wilfred
May, executive editor of the Com-r

mercial

who

and

Financial

the Securities and

mission.

Titled

World

A

course

ing

Chronicle,

formerly associated with

was

Exchange Comi

"The

Investor

Uncertainty,"
the
is designed for the invest¬

layman

as well as the pro¬
security
analyst, 'cus¬
tomer's broker, investment coun¬

of

investment

sel,

and executor.

will

be

banker,

trustee

Particular attention

devoted

to

psychological

factors which the current

war

years

in the market place.

and

Two lectures in the

series, deal¬

ing with practical portfolio tech¬

time been the principal promoter

niques, will be delivered by Ben¬

thrift

of

home

and

a

very

ownership.

jamin

Graham,

investment

Times change but the business has

manager

its

just ahead of

seize that opportunity and
upon

us.

realize

it fully, we must proceed

sound

A

To

on

principles.

leaflet

course

School,
New

giving details

a

West

66

Twelfth

proposed issue of $20,115,000)

To be

this basis. It would
to a 2% dividend

in

are

a

guaranteed unconditionally

Priced

a

each April 1, 1951 to 1965, inclusive

as to payment

of principal and dividends by endorsement by

Pennsylvania Railroad Company

Yield 1.60%

to

2.75%, according to maturity

Issuance and sale

necessary

The

discussion, I
point out that while the govern¬
2.9%

to

on

full 10%.

this

advertises

annually $667,000

The

Further discussing the dividend
consideration

Equipment Trust Certificates
(Philadelphia Plan)

mature

on

of these Certificates are subject to authorization by the Interstate Commerce Commission.
Offering Circular may be obtained in any State in which this announcement is circulatedfrom only
such of the undersigned and other dealers as may lawfully offer these securities in such State.

more

than $50 billion of Series E bonds,
it

is

1%
of

the

the

such

very

cashing

they

of not

more

ance

$50

HALSEY, STUART & CO. INC.

probably paying only about
for

on

money,

account

heavy penalties

The

R. W. PRESSPRICH

upon

bonds.

of

such

are

paying

than

1%.

INCORPORATED

EQUITABLE SECURITIES CORPORATION

The insur¬

very, very long-term
with heavy penalties for
are

savings
cashing

GREGORY &, SON

HARRIS, HALL &. COMPANY
(INCORPORATED)

INCORPORATED

HORNBLOWER

&, WEEKS

an average

companies have more than
billion of savings and these

BLAIR, ROLLINS &. CO.

&. CO.

OTIS

&.

CO.

FREEMAN &. COMPANY
:

HAYDEN, MILLER & CO.
WM. E. POLLOCK

MERRILL LYNCH, PIERCE, FENNER &, BEANE

FIRST OF MICHIGAN CORPORATION

(INCORPORATED)

&. CO., INC.

■'

,

THE ILLINOIS COMPANY
MULLANEY, WELLS & COMPANY

RAND &. CO.

out; and these companies are rap¬

idly coming to

a

2% rate in their

tion

for

THOMAS & COMPANY

savings

justifies

a

rate

F. S. YANTIS &.
INCORPORATED

Postal savings pay 2%

except in a few states, where the
rate is 1%. None of the competi¬

September 13, 1950

the

Street,

11, N. Y.

Equipment Trust, Series Z
2V2%

of

be had from the New

may

York

author of "The In¬

Pennsylvania Railroad

To

trust

telligent Investor."

greatest opportunity now and

in the years

and

$10,005,000

of

at¬

mosphere have made all-important

long

(Second and Final installment of

rate

in

of

fessional

by

question that
a

Wilfred

A.

*

induce¬

We have

money.

a

government

rate, which I think is

contracts.
•Address.

on

reserves

which

is

then

best

of

$35 billion of time deposits upon

question

sermon

the

we

commercial banks have more than

Competitive Essentials

,

meet

use

market

third class mort¬

lending.

The

4

loan

second and

gage

,

driven out of the first

be

the

beat

better to go

rate until

ment

Personally,
opinion that the sav¬
ings and loan business cannot af¬
percentages of value.

Finally again, I must preach
short

The

first time

business

accomplished

only by competitive savings rates
and competitive loan rates.

meet and beat such

can

competition
be

in this

better

over

is, then, that

dividend

and

meet

Begin Sept 2$

management

be

can

ownership and

companies did not
and we saw a
great many of them jump off the
top of their buildings within our
such,

total of 2% for expenses

competition with

keep

can

same

recognize

pletely satisfied that we ought to

to

the

banks and trust

of operation
business

money; and the poorer personal
risks and poorer security will pay

higher

It

recognized

study of this question, I am com¬

the

re¬

than 10%. and who

more

Vz of 1% to 1%.

from

are

The conclusion

of 2%

the

erations and that

savings banks with $20 billion,

paying from 1 to 2%, and with

1V2%, and with such
allocations of

reserves

2V2%.

to

necessary

a

a

Course

manage¬

onstrated

10%

Finally, if the dividend rate
question is reasonably disposed of,

2Vz% for dividend rate.

with

New

When Federal Sav¬

off,

pays

ownership.

Build

savings and loan

properties

from 5

tion

not

than

more

competition in the current market

mortgage

money, but insurance of
is life insurance for the

management.

about 41/2%.

the

Investment Problems

economy

realize

and

mortgages.

other

a

2%%.

cannot meet and beat government

home

our

the mortgage portfolio

on

The necessary cost
of

Analyze Post-Korea

account-

according to such

all three,

or

find itself eventually with a port¬
folio of second and
third grade

In

of

can

loans' lending,

only, but if this is done, assum¬
ing the association tries to get 5

then

government

the full extent

to

above

lifetimes.

is

establish a con¬
mortgage
loan
pattern of 4 to 5% for a full 20
years and up to 80% of full value.
With this pattern the association,

ignore

government competition and con¬
tinue in the savings and loan busi¬

It
12-year

we must

ventional

ventional
is

red tape.

>

beat

and

meet

higher

a

with

done

6%.

considerably.
consideration

against

account of the ab¬

on

conclusion

The

com¬

again§t 30

years

80%

be

so,

next

government

of government

cannot

it
institu¬

rates,

that local

beat

percentage,
sence

that

go

can

with conventional loans,

and

conventional,
although these ratios have varied
The

we

petition with 20

of

$6 billion is

about

conventional.

situation

situation

our

of

at

opinion

my

true

of value

identical

Assuming

and

First,

but

years,

gov¬

is

with conventional

us

loans cannot exceed 80%

both

loan

order to meet government com¬

that most of

purchase

a

However, it

so-called secondary market
pro¬
vided by Federal National Mort¬

to

in

value

shorter period.

ernment

a

be

may

is my opinion that such
be measured. If this is

.ire

the

ment,

ower

.n

the

ought to adopt in the present

long-term

a

with

future with

VCU

.J

with lit¬

there

than

more

a

The only reasonable and

rate.

reserves

years,

in vol

be

may

or

and

they can
offices, equioment, per¬
facilities, and service
will
get the
savings in

a high percentage of
loan, and possibly more risk

a

for

borrower), 20
and

Also

cash

no

100%

bank

be

risk in

m

vol¬

home

a

that

assume

more

the

will

cash.

I

about

of

is

that

so

payment

inquired with

value

ume

loans.

is

local

logical conclusion is that the busi¬

The third essential is

that

so

with

80 to 95%

lot

cost

can

To

accounts

the

ment will be put in which will
recognize that safety and security
are prime and
compelling consid¬

which

essential

loans

the

competition

make high percentage of value

,0

loans,

5%

second

long-term

comparable.

insured

probable

The

make

to

100%

year,

Russell

holders and
a

of

protect

which caused it to have to pay off
is out for good.
A new

sonnel,

appraised

to

rate

ness

petition.

competition

Horace

convenient and

Insurance

fully

ings and Loan Insurance Corpora¬

in

situation

discussion

stake.

provide

and

10% of liabilities.
to

at

as any, will

Their local savings

more

nities, the state, and the nation is

accounts

2%

Also advocates dividends to savings and loan share¬
holders be kept below 21/2% and reserves be built up to full

This

are

as

that the

local bank is paying. If the asso¬
ciations pay a 2% rate,

govern¬

value.

fined

safe

above.

accounts

competition: (1) lowering mortgage interest rates to

government

so

equally

are

loan

and

organized

deposit

General Counsel,
sees

The savings

is

satisfying to the customer than
ary of the above, except the time

By HORACE RUSSELL*

Mr. Russell

2%.

business

11

CO.

12

The Commercial and Financial Chronicle

(996)

Thursday, September 14, 1950

...

revised

during the quarter in the
war
developments and
tax prospects.
Major changes in¬
cluded an increase in holdings of
light

Mutual Funds

of

oil stocks from
a

public
stocks

Prospectus
your

upon

request

from

investment dealer, or from

him

National
research

&

securities

one

made

have

shrewdness

and

Scotch

whose

Laird,

Douglas
wit

Health

111

in

Retires

of the most popular and

successful

mutual

the

in

men

indus-

funds

corporation

t

120 BROADWAY, NEW YORK 5, N. Y.

retired

r y,

week

this

his

from
sition

po¬

Vice-

as

President

i

charge

of

n

Sales

of

tional

Secu¬

Na¬

rities and

search

Re¬

Securities

Douglac Laird

will
his

nancial

Prospectuses

ill

of

retain

fi¬

inter¬

est in National

will

Securities and

continue

as

a

member of the Board of Directors.

will

He

or

also

act

as

sales

a

con¬

sultant for the fund.

Simonson, Jr., Pres¬
ident of National Securities, in an
J.

Henry

CALVIN BULLOCK

"It is

interview, stated,

of considerable regret

health

ill

Established 1894

led

has

made

active

the

to

should

service.

retire

My

only
consolation is that he is retaining
financial

his

interest

in

poration, is continuing
ber

of

to act

of

Board

our

our

cor¬

Directors,

Secu¬
rities Company, a wholly-owned
subsidiary of North American In¬

-

Prospectus may be obtained from
your investment dealer describing
the company and its shares, includ¬

ing price and terms of offering.
KNICKERBOCKER SHARES INC.
20 Exchange Place

_____

►towV'i

_

•

miinwvC

and North American

mit

under¬

of Commonwealth, to

act

investment

as

per¬

Securities

American

North

to

principal

and

vestment

writer

manager,

without stockholder approval, un¬
til

1951,

February,

i

sion

the

when

association

active

his

with

and Vice-President and

izers

rector

of National

American

its

staff

trained

the

that

North
leaves

employ in order

employed

paid

and

of

Investment

be

to

solely
by
which

North American Securities,
will

all

undertake

ment

the

of

invest¬

functions

advisory

to¬

with the consequent ex¬
penses.
It is also proposed that
the existing investment advisory
gether

contract between North American

terminated
wealth

that

and

into

enter

Common¬

investment

an

contract
with
North
Securities,
providing

advisory
American

compensation identical to that in
the present contract.

Di¬

Securities

and

Research

United

Funds

Corp. Ceases To Be
Investment Company
of

Division

The

Finance

of

Exchange
mission

Corporation

it

has

to

Funds

Management

has

be

to

ceased

United

that

believe

cause

Corporation
investment

an

United Funds Management Cor¬

in August,
1940,
to
its
present position, with assets of
$70 million.
Mr. Laird, who was' born in

the underwriter of United

Edinburgh, Scotland, 58

amount

Air

Force

flyer.

country when
in

in

World

After the

the
I

his

as

that

to

time

it

United

Funds

Management

which
issued
face
certificates,
went
into
voluntary bankruptcy in 1942.
Company,

Bullock

New

Bullock

Literature
announced

to¬

selling attracted the attention day that members of the selling
of William Hargreave, which sub¬
groups of Dividend Shares, Bul¬
sequently led to his presenting lock Fund and Nation-Wide Secu¬
the Hargreave Science of Selling rities were mailed
copies of re¬
course
to
sales
organizations cently revised folders describing
throughout the country.
each
investment
company.
The
He began his pioneering work folders
were
revised to conform

Keystone

in mutual funds'

sales in

Commonwealth's

Pains End Up Before SEC

Custodian

.Commonwealth Investment

Company has grown

big that
manager,
North

investment

its

Funds

American Investment

had

Certificates of Participation in

take

to

Securities

INVESTMENT FUNDS

the

and

so

Corporation,

problem

Exchange

to

the

Com¬

mission.

Under

investing their capital

existing

aged by North American

BONDS
(Series B1-B2-B3-B4)

PREFERRED STOCKS
(Series K1-K2)

Invest1-

361 of the Internal Revenue Code,

COMMON STOCKS

it

(Series S1-S2-S3-S4)

I

cannot receive

more

than

10%

of its income from other than div¬

idends, interest and capital gains.
Prospectus

may

be obtained from

But

it

has

Keystone 'Company
of Boston

\

50 Congress Street
Boston 9, Massachusetts




likely that
Commonwealth

0/8 of 1% quarterly)

will exceed

this 10% limitation, because Com¬
monwealth's assets are now $19,-

000,000 and still going
..

up.

,

Since

North

American

were

Invest¬

ap¬

con¬

are

television

In

reviewing

develop¬

recent

ments, Mr. Tripp noted that the
"pessimistic attitude taken by in¬
securities

toward

vestors

television

in

electronics

and

total net assets of $18,-

reported

425,416

at

quarter

Fund

on

of

Bonds

of

represented about 24%
total
investments,
preferred

stocks

stocks,

about

Distribution

and

8%

66%

on

of

Aug.
assets

common

1950.

31,
as

among

bonds, preferred stocks and com¬
mon stocks was not revised
Korean

of

the

War.

in

outbreak

20%

that

but

increase

com¬

many

volume because of

in

military Remands

equipment."

A

registration

statement
of
filed with

shares,

the Securities and

mission

Exchange Com¬

for the
and

July

diversification, supervision

safekeeping

became fully

of

investments,

effective

market

Aug. 30.

on

of

value

the

shares is $5,190,000.

the

of
E.

election

Page

Selected

Consumer

Up

was

Fred¬

Vice-President

as

Industries

Incorpo¬

Fund, Inc., investment companies
of
which Mr. Randolph is also
President

ciated

Chairman.

and

The three

with

officers

new

are asso¬

Service Corp.,

Union

investment research and adminis¬

trative affiliate of the investment

companies.

Graduates of Harvard

University

Graduate

School of
Administration, Mr. Mc¬

research

Income

of

rated, and of Fred E. Brown,
Jr., as Vice-President of National
Investors
Corp.
and
Whitehall

Business

Reports

company,

an announcement by
Randolph, Chairman

Martin has been

Diversified

Tri-

leading

a

Simultaneous announcement

erick

Knickerbocker

F.

been

of

and President.

of

Effective

Corp.,

investment

according to
Francis

has

Vice-President

Continental

made

Becomes

McMartin

S.
a

closed-end

electronic

for

.

of Tri-Continental

the

panies in the industry may have
an

Co., Inc.

McMartin Vice-Pres.

elected

about

Emery & Com¬

of A. W. Smith &

urer

Washington statements it
now
appears that teleset output
in 1951 will be reduced by only

Mr.

member of the

a

organization

Page

since

since

1933

and

1928,
Mr.

Brown since 1936.

"Although increased taxes and
prices for civilian needs
may later curtail buying power,
currently the typical American
consumer is enjoying
the highest

higher

of

tory,"

E.

E.

Investors

pointed

income

real

Crabb,

in

Robert Watson Joins

White, Weld & Co.
(Special to The Financial Chronicle)

his¬

our

President

Diversified

of

Services,

out.

CHICAGO, 111.—Robert H. Wat¬
has

son

become

associated

with

White, Weld & Co.. 231 South La
Salle

Street.

Commenting on the
monthly
study of Real Income just released
by his company, Mr. Crabb said

with

Francis

that

Co., Inc.

the

real

income

come

index

of

F.

S.

He

I.

formerly

was

Pont

du

&

Co.,

Moseley & Co. and Blyth &

Dean Witter Adds
(Special to The Financial Chronicle)

STOCKTON,

Calif.—Robert

Schhle^" has 'been
staff

added

'o^^^Witter

of America.

V.
the

to

& Co., Bank

jBuilding.

study.
the

For

householder,

average

the outgo budget is

virtually

With First California

un¬

(Special to The Financial Chronicle) 1

changed. Increases in some classi¬
been offset

by de¬

in others.

P.

300

Newburger, Loeb & Go.

Steele
First

has

become

California

Montgomery

associated

Company,

Street.

He

was

formerly with Davies & Mejia.

Adds Five to Staff
f

Newburger,

tered

L.

vey

at

&

Co.

an¬

following Regis¬

Representatives have

become
A.

Loeb

that' the

nounce

with

associated

them:

Cowings, Walling E. Har¬

and Herman Paul Jarrett, all
the

Broad

firm's

Street,

Joseph

main
New

11 jLenzhej*

^a'r^cjS,;

jthe Bjco^way

office

York

at

15

City;

at their 2091
apd

"V i

Vt;;uT

«•

b

! *

■■"prospectus from
'

'ffiuf'ihvestment dealer

Lew^' B.

invest¬ Miller at the:brarjeh; at 931 Madi¬
stocks were son Avenue. -H.- - uc-ijulitei.;: uu

■

SAN FRANCISCO. Calif.—John

with

However,

common

S.

asso¬

group

"from

^sjthe

of?

F.

become

Inc., Ill Devonshire Street.
He was formerly Assistant Treas¬

John

the end of its fiscal
Aug. 31, 1950, an in¬

$2,000,000 since the end
of its Nov. 30, 1949 fiscal year.
Net asset value per share rose,
during the nine month period,
from $10.60 to $11.89.
crease

with

E.

Raymond

—

has

pany,

He said that

had been overdone."

creases

Investment

Mass.

I

Reports

Diversified

ments

to

we

entire,
broad
industry,
of
which
is
actually only one

$2,000,000 Increase

meeting

stockholders

as

the

fications have

Diversified

result

of

$142,425,781 on Aug.

$8,096,413; Dividend
Shares' was $80,653,993; Nation¬
wide Securities' was $15,219,247.

assets

Corporation believes that the
delay involved in calling a special

ment

activity
with

BOSTON,

segment."

Of these, Bullock Fund's

31, 1950.

become

from

payments

Tke

ment totaled

ment

Corporation, a closed-end
management investment company
which has had the job since 1932.
However, if North American
wants to remain a regulated in¬
vestment company under Section

ciated

of

cerned

electronics

$1.06, as measured against last
year's dollar, reflects the increase
to the "Statement of Policy" with in
wage and salary incomes.
In¬
respect to "sales literature" issued vestment income is up from a
by the Securities and Exchange year ago but "other income," in¬
Commission on Aug. 11, 1950.
fluenced by lower farm product
Assets of investment companies prices, is below last year, accord¬
under
Calvin
Bullock
Manage¬ ing to the monthly consumer in¬

circumstances,

Commonwealth's portfolio is man¬

IN

1

1928.

Growing

field

level

Calvin

Ray E. Chamberlain
(Special to The Financial Chronicle)

Chamberlain

Funds,

in

t

8,

ing to Chester D. Tripp, President,
"more
accurately
describes our

was

Inc.

a

success

had no connection
Funds, Inc., since

has

Royal

War

war,

he

Sept.

a

Estimated

company.

origin

served

meeting
author¬
change in the name of the
open-end investment company to
Television-Electronics Fund, Inc.
The change was approved by the
large majority of stockholders and
by approximately 99.0% of those
voting.
The new name, accord¬
ized

special

27j 1950, covering
shares of beneficial in¬

Prior

this

Television

of
a

the Knickerbocker Fund

1943.

He

Shareholders

Fund, Inc., at
in
Chicago on

Name

to

1,000,000

National Securities Series from its

in

Fund
Adds

terest in

United

18.

and

Com¬

with

arrived

steel

reasonable

notified the

has

that

and

Securities

the

poration

was

Television

Management

Corporation
in
May,
1930.
To him goes much of the
credit for the rapid growth of the

years ago,

in

Knickerbocker's Million

sales consultant to the

a

industry."
"Doug" Laird, as he is affec¬
tionately known
to
his
many
friends, became one of the organ¬

Diversification, Supervision and
Safe-keeping of Investments

=

as

the

for the

——

j—

Com¬

Investment

Commonwealth
pany

increase

moderate

Ex¬

and

from

textile holdings.

by
North
Corporation,

Commission

mem¬

as a

Corporation.
I know that, like
myself, all of Doug's friends will
miss

IFund

Securities

the

to

American Investment

and, at my invitation, has agreed

Knickerbocker

investment
application
has
been

matter Investment and Commonwealth be

a

to me that

Doug

he

that

conclusion
from

m

company,

change

advisory
loss of its

result in

regulated

ings of both principals occur.
It has been proposed to the Se¬
curities and
Exchange Commis¬

cause

Investment

a

regular annual shareholders meet¬

health,

Dealers

as

poration.
Mr.
Laird, who is
retiring
b e-

Dividend Shares

available
from

status

investment

will

contracts

C q r-

Bullock Fund

Nahon-Wide

the

prove

Natl. Securities' Stalwart

With F. S. Emery Co.

8% to 12% of the

reduction of holdings in
utilities and natural gas
17% to 9%, and a

Fund,
By ROBERT R. RICH

Raymond Chamberlain

or

.

PHILADELPHIA 2, PA

Volume 172

Number 4942

.

.

The Commercial and Financial Chronicle

.

(997)

13

t

Ira

Moitgage Credit and

Haupt and Company Exhibits at Mineola State Fair

Inflation Controls
By WILLIAM A. LYON*
New York State Superintendent of Banks

After citing vast increase in mortgage credit, New

Superintendent

recommends

lending and invest

scope

the

third

generation

gle

is

war

War's

consumer.

threatens

goods

time

in

appetite for

again

to

create

with Federal authorities.

that

fact

and

Association

the problem of

only

controlling in¬
again

gages

confronts

ropolitan

This is

battle

a

the

on

able

to

keep

held

the

at

midyear

nominal amount of mort¬

a

originating

State and

us.

financing in¬

been

with the demand for homes.
Federal
National Mortgage

pace

shortages here

flation

home

our

stitutions have

The

there, and

interest the

I have noticed with

this

biggest sin¬

our

Says

of Federal inflationary controls

and promises state cooperation
For

York Banking
curb their

institutions

funds in government securities.

more

real estate credit is in

savings

in

York

New

York met¬

the New

in

By contrast, Cali¬

area.

fornia, Florida and Texas, which
rival New York in building ac¬

home

front in which

tivity,

all

stantial

savings in¬

depended

have

extent

to a sub¬
secondary

the

on

stitutions must

mortgage

take

States Government. Our relatively

part.

We

do

not

good

know

the

size

a

of the defense

effort that
will

Wm. A. Lyon

to

am

It

is

that

able

be

not

break off

to

soon

very

Now

developed

building

in every way
the

find

must

trends

of

Mortgage Credit

on

must

we

expect

that the

of mortgage portfolios

up

will be slowed down considerably.

Wars,

less than total

even

serious distortions.

cause

exertions.

our

regrettable

we

Slow-Down

a

will have to be made and that we
shall

well

York's financial institutions active

token effort
will suffice.
The prudent course
is to expect that a major effort

think

we

be considered

may

the

to

in the mortgage market.

but we
will be deluding ourselves, I
make,

afraid, if

showing

tribute

United

the

of

savings habits of the people of the
State and to the enterprise of New

we

have

market

economy as
tive as ours

boundlessly
war

an

apparatus and

usual at the same time.

business

I

Something has to give. The effects

to you I

thought that I could con¬
remarks to the great rec¬

fine my
ords

construction

residential

of

that

have

this

in

achieved

been

country. New York has been mak¬

ing giant strides in satisfying the
for

demand

nearly

last

dwelling

100,000

started

With

homes.

new

units

State has
responsible for nearly 10%
our

year,

of

as

and

war

not

be

but

if

make

we

will

be

all

we

on

hope

the side of

When

spend less.

We

at

spends

individuals must
can bring private

combines

addition

In

exceeded

was

for

last

the

against

by California
population

only

in

increase

the

decade

in

7%

only

was

53%

as

York

New

Mutual Funds'."
within

record

residential

of

rate

building is marked by the great¬
est
increase
in mortgage credit

Since the end

experienced.

of World War II the national home

mortgage debt has more than dou¬
bled and now stands at about $40
billion.
tions

Savings and loan associa¬

have

played

tant role, year

this

most impor¬

a

by year, in financ¬

expansion.

one-third

about

mortgages.

In

They

alh

of

our

hold
home

restate

New

about one-quarter ,of

loahr'£lss6cia-

and

savings

to

go

hpmp( mort¬
of Jf>zO,t}6o or less

recordings

gage

Thus t^ese institutions have

tiors.
been

fulfilling

mary

purposes

one

in

of their pri¬
outstanding

an

fashion.

have also done another
fine job. They have been a pow¬
erful influence in cultivating the
They

of

habits

savings
rate of

the

growth they

su¬

savings shares. By midyear

rise

of

free

scares

that

had

outstanding on V-J D^y. The
in new savings members in

this period has been by more

than

50%, which means that more than
200.000

than
to

your
*An

62nd

^shareholders

.new

borrowers

other

l?ave been added

rolls.

address

by Supt. Lyon before the

Convention

of

the

New

York

State

Savings and Loan League, Saranac, N. Y.,

Sept.

11,

this time.

the left shows a montage of various pamphlets and articles on mutual
income? Come in and ask 'How to get more income through
On the right an outline of the United States, with its many
industries pictured
on

the

boundaries, has the slogan—"Profit from part ownership in

America's industries."—run¬

Inside the tent other displays and

interested visitors

exhibits outline other reasons for investment in Mutual Funds.

relax at while an Ira Haupt salesman

to

explains the facts of this

investment are placed throughout the tent. On the tables are pamphlets explain¬
ing the operations and reports of more than a dozen or so various mutual funds now in existence.
type

of

wise policy of the slogan—"Save—then invest in

To remind each visitor of the
—a

guest.

small coin bank is presented to each

Mutual Funds"

,/

1950.




in

that

funds

come

to

as

This announcement is not
The

invested

an

offer to sell

or a

solicitation of

an

offer to buy these Bonds.

offering is made only by the Prospectus.

much as

are

pressures

Funds that

possible.

do

that hold down the

ways

inflationary

can

The other half is to

the

manage
you

NEW ISSUE

without regard for the necessities

$20,000,000

of

inflationary control will speed
the depreciation of the saver's
dollar and hence place a profound
discouragement in the way of all
savings.
If we cannot persuade
up

Virginia Electric and Power Company

the American people to save more

First and

and spend
rect

less, we can expect di¬
controls—over prices, wages

and

strategic

materials—to

come

Dated

back.

Refunding Mortgage Bonds, Series H 2%%
Due September 1, 1980

September 1, 1950

One of the very first steps that

savings
help

institutions

in

the

take

can

suppressing

flation by indirect means
that
the Treasury finds

of

to

in¬

Price 100.75% and accrued interest

is to see
enough

money
outside the commercial
banks and Federal Reserve Banks

in

they h?d come three-quarters of
the
way' towards
doubling the
amount

at

to

ment; both as regards the percent¬
age rise in the dollar amount of
savings and the number of hold¬
of

ings institutions like yours

In

pervision of the Banking Depart¬

been

>

exhibit, each side of the tent has an attractive dis¬

public.

the fastest

public.

are

growing institutions under the

ers

help to check

slogan banner atop the

That is half of the job that sav¬

The

ing

can

the

ning from coast to coast.

by redoubling their ef¬

forts to attract the savings of the

State.

ever

They

inflation

to

feeling of the Fair with the dignity and secure aus¬

<

The display

play poster.

popular

where

"close-to-the-people"

the

funds and is entitled "Looking for more

activity is concentrated, New York

in.

Charles Bacon, man¬
Funds department, and Anthony M. Reinach, Ira Haupt and Company,

investments.

of

Tables for

come

reasons

many

Mutual

terity

This is where savings institutions

In

capitalist," the

Fair, offers

partner,

where most of the

national housing effort.

of the

urban building,

first visitors to the Mineola

exhibit of Ira Haupt and Company in the heart of the Fair.

atop the

exhibit, which is the idea and product of the combined thinking of

spending down forcibly through
raising taxes or voluntarily by
stepping up the rate of savings.

been

"small

the

at

State

of Ira Haupt's

ager

error

arming too

a

The

may

in the

any

government

private

more,

mistake

a

banner

a

exhibit, the first of its kind presented by an investment
why the average American can build his own financial
security by judicious investment in mutual funds.

preparedness I am

our

that

soon.

needs

from

Aimed

firm

fully felt until next year,

timing of
sure

defense

Fair

State

the

the last few years

imperiled. When
accepted the invitation to speak

"Save—then invest in Mutual Funds" is the slogan which greeted the

produc¬

supply

cannot

demands of the

wars,

Even

finance
the

any

war

deficit it

and

runs

defense

up

Copies of the Prospectus may be

effort.

as

are

obtained from such of the undersigned

registered dealers in securities in this Slate.

The borrowing needs of the Treas¬
ury should be filled out of private
savings—savings invested directly

in

Salomon Bros. & Hutzler

savings bonds by individuals or
in government securi¬

indirectly
ties

through

savings

institutions.

Blair, Rollins & Co.

It is necessary,

therefore, for sav¬
ings institutions to take up their
share

of

new money bonds
the Treasury. Recent
Treasury finance sug¬
gest that our difficulty may lie in
the Treasury's reluctance to offer..

offered
events

Lf.e Higginson Corporation

L. F. Rothschild & Co.

any

by

Schoellkopf, Hutton & Pomeroy, Inc.

in

bonds rather than in

institutional

unwillingness to buy them. , '
odi
The recent increase i'ri thd' dh- **•
n'ual qUdta' of savings bonds which
an

Drexel & Co.

Incorporated

institution

is allowed

Continued

on

to

take

page

16

Stroud & Company

The Milwaukee Ccmpany

Incorporated
tea:

>>

bopj.
r

Folger, Nolan Incorporated

J,

September 14,1950.

Cooley & Company

14

The Commercial and Financial Chronicle

I

(998)

'

I

Pillsbury's Gold Plan as
Thermometer, Not a Protector
"Chronicle"

George F. Bauer, referring to industrialist's recent

Our

Editor, Commercial and Financial

Under

"Labor's

entitled

Security Package and the Collaps¬
ing Dollar" ["Chronicle" of Sept.
7, on page 17] Mr. E. S. Pillsbury
pointed to an
increasingly
alarming situ¬
ation

whereby

the

actual

definite rate.
Pillsbury's plan the

Mr.

step contemplated toward

one

habilitation

provide

of

our

re¬

is

money

to

in order
gauffe daily whether

thermometer

a

that

we

the

dollar

may

is

getting

weaker

stronger in terms of gold.
He refers to the experience of
the

their

with

French

currency.'

being under¬
mined through

faulty

monetary policies.

of

power

pensions

and

is

wages

mone¬

policies.

tary
It is

regret-

They had such

a

The mere ex¬
istence of the thermometer in the

form of

so-called free gold mar¬

a

table that Mr.

1

ket did not deter the French Gov¬

Pillsbury,
while
Bauer

stress¬

ing
Ceorge F.

ernment

a

which finally ended
worth only 1% of its

as

rective

the

relationship
tive

action
of

gold,

did

the whole distance and in¬

that

become

government

our

definitely responsible for its issues
of paper money

obliging it

by

commitment

a

demand to provide

on

for

conversion

$35

per ounce

at

fixed

a

rate

be exempted

tion

of

from

is still
obliga¬

any

of convertibility

of its paper

into gold at

definite rate

money
and

to

ate

we

with

content

make

ourselves

observing what

dollar is daily

commodity

a

our

worth in gold

in

the

from

as

a

In

the

those

as

post-Civil

in

War

government

certain

when

years

not

was

the

of

our

obliged

to

franc

a

do

we

need

original buy¬

the

need

not

dollar

S.

U.

thermometer;
commitment by our

a

a

government to

make

good

representative

dollars

bv

its

on

ob¬

an

ligation to convert them for hold¬
ers

demand

on

Otherwise

have

we

at

$35

find

may

illness but that
nevertheless
form of

a

ounce.

that

we

needed

be

provide

will

cure

in

the

commitment in gold

a

money

monetary

our

drastic

government

our

per

thermometer to record the

a

the

for

upward,

Security

The

GEORGE

back

of

Trarsvision, Inc. common stock is
being made today by Blair F.
Claybaugh & Co. The shares are

priced to the public at $2.75 each.
The offering is subject to the sale
of at least 135,000 shares.
Proceeds
stock

the

from

will

be

sale

used

Trade, Inc.
11, 1950.

Inc.,

corporation

working capital, and to

Transvision,

in

general

vision

and

receivers,

television

parts

television

accessories,

master antennae

over-the-

kits,

manufacturing
which

as

purpose

cathode

used

are

television.

The

pany

ture

an

to

as

additional
com¬

as

FT.

technicians.

SAN

to

the

.

,

the

pany,

on

of

(Special

SAN

to

The

Financial

Waldron

the market

surprising to

see

thin

&

Com¬

SPRINGFIELD,
Stoddart

With W. E. Hutton

Main

a

is

in

the

BOSTON,
is

of Commerce

8

with

L.
He

J.

Newbury Street.

ties of

com¬
manu¬

territory, served

is

at

2,032,000,
roughly
residing in communi¬

1,000

or

inhabitants.

more

CHICAGO, 111.—Fra-k B. Kendrick
,

long-term

Some

has

become

on

for

the

on

208

Co.,

Street.

with

Otis

He

&

Co.

La

formerly

was

and

with

South
in

the

past

with Riter & Co.

was

With

still

are

the sidelines

on

balance

time

some

private

on

affiliated

&

Reynolds
Salle

made in the list.

(Special

SVolten, Knight

to The Financial C.tonicle)

CHICAGO,
Lawrence
with

at

buy side, it is not
the

there in

issues

111.

has

Sholten,

South

La

—

Linneus

become

Knight &

Salle

for

Co.,

Street.

many

A.

associated

He

135
was

with

years

First Boston Corp.

yet.

placements

With Thomson McK'nnon

that

(Special

to The

Financial Chronicle)

INDIANAPOLIS,
W.

Farmer

have

Ind.

—

Harry

Joseph B.
affiliated

and

become

Lacy
with

McKinnon

&

5

East

Market Street.

Long Terms Expected

some

scale purchasing going on.

How¬

these have not been very sizable and they have been

less of the reluctant

would

be

reached.

though not

a

are

For

B.

they

purchases
certain

that

,

Gage,

an

rujo

i

Kjo

U. S.

obr./ou,

of stabili¬

era

being,

quarters

at

least,

'TREASURY

it

going

are

going to give them

will

be

on

the

side,

down

an

opportunity to

undertaken.

Switches

before

★

★

★

prove

have

important

given

scale

fillip

a

certificates
1967/72

being watched

are

rush to

no

make

price

the

good.

some

There will

2V2 %

Co.,

;

case

bonds

when

not

be

eligible
make

more

v,

t

There is the fear here also

longest

1

<

notes

commitments, despite the need for

adjustments in

so

very

i't

■

obligation

purchases at

than

a

passing

it approaches an area of

believe might be somewhat under

cur¬

The 2V2s

and the

not too much real

214s of

1956

are

also getting

attention, but

buying at the moment, because recent purchases

pre¬

Polny

■

to

issues.

further

t

bills

rent levels.

are

&

time

many

few of the potent'al buyers of the higher

might take it down to levels that would

A. Day & Co.

Buck

the

before

mi ..in,-

more
.

variety, because it is felt in

longer-term issues might go lower,

stabilization, which

was

Mass.—Harry

Richard

a

the market has not been entirely devoid of buy¬

present prices look

(Special to The Financial Chronicle)

staff of W. E. Hutton & Co., Bank

be

to

it has been

as

because there has been

zation

in

C. Johnson has been added to the

The

will be'seen in

raper

mortgages and

the income which this issue provides.

With Richard J. Buck

Berta

the

of

Thomson

Mass.—Harold

with

Street.

Co.

"West Vir¬

conducts

two-thirds

being sold by these institutions.

are

also there is

securi¬

offices

viously with Charles

(Special to The Financial Chronicle)

and

closely by many of the out-of-town institutions, but in this

Chronicle)

engaging in
from

tion

formerly

develop here and

gaps

and

miles.

square

estimated

foregone conclu¬

a

quite willing to stay

are

enough

as

Power

gas business at Norfolk
and Newport News.
The popula¬

sufficiently high rates to make it worth while to sell governments.
With

&

,

Calif.—

With L. B. Gage

W.

to be

seems

they will continue

are

be

Carolina

also

pany

picture unfold."

to

seem

Electric

factured

further changes would have to

mean

The bank 2M>s of September

Financial

North

32,000

Because of this uncertainty, it is rot at all surprising

indications

where

(Special to The Financial Chronicle)

of

intermediate-

1%% rate for certificates there

higher rate would

yielding Treasuries

Chronicle)

FRANCISCO, Calif.—Alex

business

the

1V2% rate for one->ear

a

Based upon a

prospective buyers

There

Calif.—

Alex Wilson Opens

1387




have

interest in the longest bank

Co., Standard

Bldg.

believe that

To be sure,

Alexander Building.

staff

Me.—Mrs.

will

to
run

100%.

Joins Reynolds S'aff

A 1%% rate for certificates

watch the

and

Russ Building.

E. Wilson is

,

PORTLAND,

this

103%%

redemptions

(Special to The Financial Ch-onicle)

are row trving to figure out, how hmh
likely to go under Federal's sponsorship and

are

from

to

ginia, covering approximately

ding to reports

0

$29,000,000.

Chronicle)

FRANCISCO,
staff

a -

Insurance companies and savings banks are sellers

ers,

Harry L. Chandler has been added

Ind. —Andrew

has joined

Robert G. Shimel &

Bldg.

to The Financial

to The

intervals, and

at

be redeemed at

in and buy certain issues in order to stem

Lower Prices

Financial Chronicle)

WAYNE,

O'Dwyer

at

30,

electric utility operating in
of Virginia and in portions

an

of

very

York

With Waldron Co.

ties

to The

New

FRANCISCO,

(Special

kits

With Robt. Shimel
(Special

effect

appears as

manufac¬

distribute television

well

rates

place.

that

the

which could be assembled by lay¬
men

in

as

King Merritt & Co.,
Inc., Russ Building.

tubes

tubes, the

organized

was

and

investors

banking

100.85%

Virginia

issues should

markets

money

even

to the staff of

of

picture tubes in

To create

market for these

ray

bad

ranging
Special

100%.
from

1%% Certificate Rate Anticipated

or

Lectrovision,
wholly-owned subsidiary,

a

of

management

systems and tel¬

organized for the

was

market look

Federal has had to step
the price decline.

Yoshiaki Moriwaki has been added

evision picture tubes.

Inc.,

the

June

estimated

are

prices

they have been recently in increasing numbers, prices of the longs,
particularly, have gone down quite easily, because investors, deal¬
and traders are not there to support them.
They all seem to
believe quotations can go lower, so they argue, why stick your
neck out now and get it chopped off?
This fear psychology has
made

for
re¬

1950.
expenditures
for
estimated at $37,500,000,

are

tures

pushed up by the Central
cautious in their commitments,

more

after

markets

ers

ever,

SAN

in

sale of tele¬

l

market is

construction

of
which
$16,800,000 has
been
expended through June 30. For the
year
1951
construction
expendi¬

thin at times (on tne bid side)
particularly among the intermediate—and longer-term maturities.
Accordingly, Federal has the market pretty much to itself and that
goes for the longs as well as the shorts.
When sellers appear as

hence¬

King Men-it* Adds

two

repay

(Special

an

direct

international

as

becoming

are

the

the

of

Inc. is engaged

the manufacture

Buyers
means

City real estate.

loans.

outstanding

in

1950

is

which

for

The bonds may

various

banks

expen¬

most

announces

will

Silberstein, President. UNO
Equities, Inc., heretofore was ac¬

tive

the

where

out

or more of notes

unaffiliated

Construction

eventually

money

from

the

sell if the certificate rate should still be

take

L. D.

well

effort to find

an

$11,000,000

three

ditures

government market continues to be subjected to the
of advancing short-term rates, which has created uncer¬
tainty throughout the entire list. Yield curves are being worked
overtime in

received

be

mainder

The

considerable adjustments which will have to be

securities, with offices at
Pine Street, New York City,
the

this

on a

to

awarded

were

competitive sale
bid of 100.33317%.

at

construction purposes and

the

sion among most of the operators in the government market.

Equities,

deal

under

to pay

pressure

F, BAUER.

New York City, Sent.

increase

to

force, the question is being asked: Will
change in Federal's policy toward the

the future.

30

in

be

to

Sept. 12

to

any

even

the

continued

Co.

the sale of the bonds will be used

expecting.

the Defensive

on

securities

are

Power

&

bonds

group

Proceeds

and the trend and level of interest rates?

and

shares

in

mean

New York Board of

UNO

do, the middle and more distant
undergo further yield changes. This

to

to

Electric

The

the

on

1954, the IV2S of 1950, and the 2V4S and 2V2S of 1956 were under
The longest bank 2%% and the taps also gave ground.
All of this took place on lighter volume.
With Regulation W

International Section

forth

300,000

short-term

to

pressure.

issues.

Vice-Chairman

that

likely

have

and

Hutzler

and

terest.

spotlight,
far outshadowing the rest of the list.
Investors are seeking the
safest haven for funds during the period of rate adjustments in the
money markets.
This seems to spell out, "go shoU." The l%s of

what

counter

of

still

Investors

short-term

Package.

Over-Counter Sees.

Offering

seems

to be what most followers of the market

appears

An

F.

it
will

as

&

offering $20,000,000

refunding mortgage
bonds, series H, 2%%, due Sept. 1,
1980, at 100.75% and accrued in¬

bv

Sincerely yours,

by

first

Bros.
are

Virginia

long-term issues have been followed by only very minor recov¬
eries, due in part, according to advices, to support supplied by the
Central Banks. Nonetheless, if the short-term rate is to continue

paper

UNO Equities to Handle

Stock Offered

Salomon

associates

and this continues to influence the whole level of yields in the
Treasury list. Periods of price weakness in the intermediate- and

maturities

by Satamon

Bros. &

Closing of the books for the September refunding, the reirnposition of Regulation W, and somewhat lessened activity in gov¬
securities, were the important developments in the credit
picture and the money markets'. The near-term rate is still edging

it issues, if the dollar is to
a
sound
component
of

Labor's

Offered

Banks.

of

case

we

with fluctuations that might be as
erratic

with

steps

power.

markets

open

fiscal

taking

fever variations in

of gold.

It seems the government
to

ing

a

representa¬

and

money

paper

not go

sist

between

cor-

need

f

By JOHN T. CHIPPENDALE, JR.

or

thermometer and
daily could see how the franc was
depreciating
or appreciating
by
measure
of
gold
in accordance
with unwise or temporarily wise

buying

'

'

Governments

on

up,

"greenback paper money"

convert

into gold at a

Chronicle:

Reporter

ernment

article, criticizes him for not insisting on our government's
full $35 per ounce convertibility.

article

Thursday, September 14, 1950

■..

1

Va. El. & Pow. Bonds

Describes

the

'

TO THE EDITOR:

LETTER

In

'

*

now

more

showing losses to their buyers, and they
of the

same.

price change in these
them again.
have given a

whole

are

Nevertheless,' it wonT take much

tWd

more

of

INCORPORATED

issues

before

scale

good account of themselves in
on

8c Co.

a

buyers will be atm

The 2%s due 1960/65 have not been very active but

has been

Aubrey G. Lanston

not interested

the weak

side.

a

market which

as

a

The few bonds that have ap¬

peared for sale have been readily absorbed.

r.

■n

15 Broad Street

l

/ 45 Milk Street

NEW YORK 5

BOSTON 9

WHitehall 3-1200

HAncock 6-6463

Volume 172

Number 4942

..

.

The Commercial and Financial Chronicle

1G

(999)

We

Consumer's Interest

have

figures of a util ty's economic life as its
stockholders, stresses "cost of living" problem of utilities in
effectively carrying out operations to provide adequate service

and

ments

local

think

all

completely
that

of

as

and

vately

the

tal out of the air

ouflrushes. It must compete

man¬

pri¬

to

much

in¬

lars.

facts

gjvernment,

of

ures

fig¬
util¬

a

•life

as

is

As

it. elf

con¬

earns

Richard L. Rosenthal

consum¬

utility

services

in

ested

the

monthly

for

"why's"

of

bills

the

inter¬

much

as

service

reasons

properly

a

their
in

as

of

costs

the

every

i

is

the

It

term.

income—but

if

the

properly regulated, that
is only so much

come

as

is

required for the payment of "hire"
what

or

investors

require for the

investors' funds committed

of

use

It

is

eveo

that

necessary

make

we

10 encou.age consum¬

eiiorc

to

efiiciency and at minimum
economic cost, considering all fac¬
tors, it should want its customers

thereby

and

better

Actually the private utility fairly with its employees—or it
company, fundamentally, is merely won't have the staff with which to
a
vex.icle
which
permits
the operate. Most people will quickly
achievement
three

performance

or

basic

social

and

of

economic

functions.

nomic

r^tes.

The

second

is to

adequate service,
These

ture.

the

pay

in

course,

in¬

reasonable

proper

important—and just

as

the

utility

treat fairly with

company

it is not

enough to

order

to

make

it

the

to

more

multi-billion

of capital

required

achieve

this

necessary

to

end

in

make

raise funds

from the
not

investing public. This is
theory; it is a continuing

a

able

the rate of return

wiil not be

company

conti.-ue

expand

10

and

and'salaries, property and improve its service by attentions to
plant a d facilities. It wili not be

wages

income taxes, fuel and otner pur¬

chased material and

supplies and

the cost of wearing out or depre¬
ciation oi plant and equipment.
The third

tion

is

to

utility

func¬
suflicient net

company

produce

income—after all operating

including taxes—to provide
with

tors

income

net

as

what

investors

costs,

able
to

because

to

it

get funds from

it is

the

ill

j

needs

There is

require

ice to

a

construction

cials

and

expansion

pro¬

investors

unless

Therefore, such
be

cannot

program

by

sufficient to finance

not

are

continued

be persuaded

can

company's earnings to invest

a

additional

because

funds

in

without

the

It is the combination of the cost
and

third

consumers

functions

is

the

.

mental

for

feed

doesn't

the

eat,

adverse

"Investor Dictated"

utility company can
the investor-dictated

of net income—net income

quota

adequate

continually

capital

measured

as

to

by

attract

the

mar¬

kets for the utility's securities—it
•cannot

obtain

desires

service

in

for

its

capital and, there¬

effect

matter of

a

our

likes and dislikes.

Thus, if
company's earnings are
adequate, the public interest

*An
the

accordingly,

address

New

York

by

Mr.

Section

in

terms

Rosenthal
of

the

of

before

American

Water Works Association, Saranac, N. Y.f

Sept. 7,

1950.




is

is t

ie

cart: capi¬

pulls the
investment is

on

horse.

If

the

horse

won't—and

he

ulti¬

and

revenue

this, the
requirements of

utility will be readily
appreciated.' In time they shouid
be understood by the consumer as

outstanding upon

[

ments

service
■

our net in¬
come has to meet investor require¬

if

we

successfully

are

to

its

render

to

i

raise

to

funds.

(Special to The Financial Chronicle)

I conceive it to be in the public

advise

to

income

of Wilson, Johnson & Higgins, 300 Montgomery Street.

if

great
to

as

The

these

reason

concern

utility
for this is

increased

funds

to

the

costs

adversely affect the net
of
the
utility company
raise

Co.

Oil

and

Mr.

is

Cody

a

Vice

With Schwabacher Co.
1

(Special to The Financial Chronicle)

SANTA
Samuel

Opens Office

BARBARA, Calif.—

Welsh has

become

(Special to The Financial

affili¬

Chronicle)

FRANCISCO,

SAN

ated with Schwabacher &

Calif.-

Co., 930
State
Street.
He
was
formerly
with Paine, Webber, Jackson &

Bertha M. Floyd is e: gag g
*
securities business from offices, at

Curtis

® Sutter Street.

and

Al

„

Buckley Brothers.

First Continental Co.
HEMPSTEAD, N. Y.

„

With Guardian Securities

F i r

—

s

t

(Special to The Financial Chronicle)..

Continental Company is engaging
in a securities business from of¬
319

at

Main

income
that it
the

from

so

FRANCISCO, Calif.—Ed¬
Peck has become associ¬
with
Guardian
Securities

SAN
ward

Street.

ated

J.

He was formerly with Can¬

Corp.

Harland Allen Assoc.
CHICAGO, 111.—Harland

tor, Fitzgerald & Co., King Merritt
& Co. and prior thereto was with

Allen

Denault & Co.

Associates is engaging in a secur¬

ities

business

East

Jackson

and Federal

as

include

Keck,

President of that company.

from

offices

28

at

Boulevard.

Joins Schwabacher
to The

(Special

With Blair, Rollins

taxes, are therefore mat¬
just

for

C.

J.

particularly

company.

that

customers

costs,

local taxes

increased

the

Jr., President, and
Cody, Vice President.
Mr.
Keck is President of the Superior
M.

W.

staff

Costs

increased

of

chiefly

sale

Officers of the company

FRANCISCO, Calif.—Neal
Kellogg has been added to the

Advise Customers of Operating

that

used

drilling and other operations and.
expenses of Canadian Superior in
Canada and possibly elsewhere.

.

SAN

fices

consumers,

be

and

Wilson, Johnson Add
H.

will

acquiring and holding reservations
leases
and for exploratory,

proper

customers.

•

the

from

Proceeds

shares

acres

personal

own

investing public; and

ments

continue

1,600,000
leases.

freehold

under

utility company
obtain the capital to enable

to

Such total includes

approximately

order that the

dictated by the general

are

and Manitoba.

increases when costs,
particularly local and
Federal taxes, go up substantially,
in

Superior

Canadian

rate

SAN

(Special to The Financial Chronicle)

lins

has

Blair,
South

become

Rollins
La

Salle

with

connected

&

Co.,

Inc.,

and

135

Street.

Financial Chronicle)

FRANCISCO, Calif.—Allan

Cohn, Jr. has joined the staff of
Schwabacher & Co., 600 Market
Street, members of the New York

CHICAGO, 111.—James H. Col¬

Francisco

San

Stock

Ex¬

changes.

in¬

vesting public because its net in¬
and

come

rate

of

return

are

adequate, the company's predica¬
ment can only be solved one of
two

advertisement

This

not

of

NEW

these

to

more

earns
can

with

a

more

and better service

consumers.

If

is

neither

securities.

an

The

offer

offering

to

sell

is

nor

made

a

solicitation to buy any

only

by

Prospectus.

ISSUE

ways.

The first of these would be

tirely

to

investment
dition

ties

300,000 Shares

en¬

eliminate future capital

and

and

TRANSVISION, INC

and, therefore, the ad¬
replacement of

equipment.

facili¬

This,

of

Common Stock

would
adversely
affect
because it would not
rate
and
revenue
requirements enable the utility company to pro¬
basically in his interest—the in¬ vide new customers with service
terests of

course,

(Par

consumers,

and

utility

Irom

satisfactory net income it
capital in competition

would

restrict

the

Value

$1

per

Share)

Price $2.75 per

company

Share

with

a

attract

other capital

seeking

enter¬

providing present consumers

improved service in greater
quantities. The other alternative
would

be

to

seek

rate

Copies of

the

Prospectus

may

the undersigned as are

be

obtained in

any

State only from

such of <

registered dealers in securities in such State.

[

relief,

prises and governmental units.

If it does not

attract

capital, it cannot.
Fun¬
damentally, our investor-dictated
earnings and, therefore, rate re¬
quirements
that.

are

just

as

simple

as

We in the industry know it.

a

now

completion of the financing.

knowledge of these "facts

including

These require¬

not

improve,

expand its facilities.

suffers

000 shares to be

Con¬

life," of the "cost-ofliving" of the utility company, will
perhaps aid the utility company
in holding down its costs on be¬

on

and extend service.

maintain,

to

approximately 52% of the 4,450,-

a very

consumers.

on

Superior

Canadian

of economic

cannot be

the utility

and

cannot

effect

sumer

it

in

If through higher rates, in order that
n attracts capital it can perform its
the utility's income may be re¬
f rst function: r, aintain, improve stored to a level adequate to en¬

fore,

salaries, without

direct

amounting

issue,

wholly-owned subsidiary of the)
Superior Oil Co. and the latter
company
will
own
and retain

tap for increased
prices for their products and em¬
ployees
can
drain
for
higher

funds

utility
net income arising from increased
costs as the result of continuing
inflationary trends, increased local
taxes and prospective higher Fed¬

of

understands

consumer

ing" for the utility.

produce

wages and

the

215,000 shares, in Canada.

dip for

can

of

tion

an

local and

can

equipment want to be paid for it
in cash—not good intentions.

consumer

the private

a

way.

not

suppliers

Manufacturers of such

tr.e

mately can't—pull the cart. If the
rate

Unless

by Wood, Gundy & Co.,
Ltd., as sub-manager of the group
are simultaneously offering a por¬

increasing amounts of taxes,

ever

may

such

the program

to

ters

which

horse

which constitutes the "cost-of-liv¬

Net Income

is

company
well into which

Federal Governments,

company,

large amounts, equipment funda¬
purchased.

cannot

cart; and return

finance

plant and equipment replacement
and expansion.
of the second

utility

headed

com¬

other

no

seek

the personal

gram, tne earnings of a company
and the personal funds of its offi¬

And

simple analogy. Serv¬

of

to

operate in

sion requirements.

matter what

no

desires of the individual company
officials relative to continuing a

able

area.

tal

needed

and

better

and

more

service

securities, the utility

endless

Ltd., at $10 per share (U. S. dol¬
lars).
Canadian
underwriters

rate

indicated by markets

inves¬

to

capital

be

vestors.

only with such funis that the
can bring about expansion

persuade them
to provide the continuous supply
new

won't

i

utility
to

investor-dictated

as

2,150,000 common shares of Ca¬
nadian Superior Oil of California,

require¬

the program under present expan¬

that

permitted rates high

earn

utility
to

and

and

States

Dillon, Read & Co., Inc., is offer¬
ing to the public today (Sept. 14)

con¬

of the indus¬

capital

of United

(organized
in 1943) has been conducting an
extensive
program
of
freehold
leasing and reservation of oil and
gas rights in Western Canada, and
half of consumers.
In any event,
now has over 4,000,000 acres held
such knowledge will indicate to
under leases, reservations or op¬
consumers
why the utility com¬
tions widely scattered over large
pany must—no matter what the
portions of Alberta, Saskatchewan
personal desires of its officials—

condition. It needs to be reiterated

(ratio of income after taxes to in¬

—t..e

ments

more

group

Canadian underwriters headed by

its in¬

If it doesn't—or can't be¬

vestors.

continued im¬

a

reason

enormous

pany can

interest, and in accordance with a
and fu¬ vestment) which investors require policy of treating fairly with our

pioviding

present

costs, of
and

oper¬

just

fundamental—that

cause

ating costs involved

clude

ft is
as

The first of these is to provide
adequate service at minimum eco¬

with these two premises.

agree

try's

The

service

But

A

in

By

sumers.

of return

income.

aggregates

not

itself.

•

and

ex¬

comprehend that all that the
utility company wants, needs — eral
income taxes is a matter of
and, indeed, on behalf of its con¬
very
definite concern.
It has a
sumers, must have—is rates high
very definite relationship to the
to know the fundamental reasons
.enough—but only high enough—
industry's ability to obtain the
for its costs and, therefore, for the to
perform these three basic func¬ funds from the nation's
investors
rates it must charge for its service. tions. In order to stay in
business,
^necessary to carry out construc¬
Although most consumers do a utility company must treat fairly
tion at d expansion programs. Our
not realize it, the utility company with its consumers—or
they won't
requirements for net income are
has
a *
its
services.
It
must
treat
"cost-of-living"
problem use
ers

imum

•

1950, will

increase

considerably

The

in the business.

other necessity.
If a company is confident that it
is serving its customers with max¬

net

"profit" in the

a

of

sense

a

utililv
net

just

are

fact,

really make

technical

today.

of

ers

of

matter

a

regulated utility company doesn't

cost-

of-living
And

the in¬

pay

rities.

com¬

panies. Every¬

scious

it must

in

also

net

a

utility

body

hxe investois' dol¬
them, including

of

price—it must earn what
require as return, as in¬
by market prices for secu¬

dicated

•stockholders
of

all

and

nvc^t.mj

the

are

Like

vestors

ity's economic

-

State, Federal,

...umcipai, for

terested in the
and

in the

industrial,

governments,

date

some

added-^-will

retro¬

Superior Oil Stock

consumer

utility service and
the availability of greater quan¬

Funds

railroad, and
other utility companies—and with

j

utility com¬
panies are just
as

with

—

:

the

tities of such service to

tax,

Utility officials and managers,
individually, all want to provide

capital markets with all enterprise

owned

which

if he desires

for its

find it in the

or

for

profits

excess

an

Investing Public Must Furnish

utility adequate service to consumers. The
as
utility company doesn't get capi¬

might the fact

of

The

Offering Canadian

higher
Federal
income
taxes, and higher operating costs
of all types are ultimately some¬
taxes,

pays,

reduce

realized

Dillon, Read & Go.

management
and
as
investors.
Higher local

its

in Federal income tax rates

more

privately

we

customers

aged

in

us

not

ex¬

taxes, adding sub¬
expenses.

penses

operating costs, and to produce suffi¬

as

have

years

does

thing

to

consumers.

I

few

unusually sharp in¬

corporations

be

which is "investor-dictated."

business

everywhere

in¬

active

affecting ability to raise capital, and contends
properly regulated utility should make no "profit" above that

-

happening to the operating cost
a utility company as does that

provement

capital needed to finance replace¬
Calls attention to tax and inflation

expansion.

of

pending before
now the
prospect

cient net income to obtain

increases

is

Congress—and

interest in facts and

pay

con¬

that

much

as

past

an

in

crease

have

the

stantially
for

rates, to

in

crease

President, Citizens Utilities Company
consumers

companies

perienced

By RICHARD L. ROSENTHAL*

at minimum

our

company's

Utility

President, New York Water Service Corporation

executive, in pointing out

that

sure

understand and appreciate

it, too.

In Utilities' Success

Utili ies

be

must

sumers

able

it

to

continue

vestor capital.

to

obtain

in¬

This, of

course,

Blair F.

ob¬

viously affects the consumer very

just

as

consumer,

direct

an

therefore,

has

interest in what

Jacquin, Stanley & Co;,

Raymond & Co.

directly and very apparently.
The

White & Co.;

Claybaugh & Co.

Bittner & Co.

September 14, 1950

J6

The Commercial and Financial Chronicle

(1000)

ciations

land, Moreland & Co., of Detroit, and Robert D. Diehl, Paine,
Webber, Jackson & Curtis, of Los Angeles.
All members of the Committee have Calcutta tickets and the
official entry blank for NSTA golfers who will play in the
Golfers are urged to send in their entry blank as soon as

Notes

Convention

prior

Headquarters

tournament will be

Friday,

to

Sept.

29,

the

set

tion.

that

realized

have

we

breaking new ground in de¬
veloping the liquidity ratio and

the

that

played.

ideas should not be firm¬

our

formula had
period of
years.
We
review the formula
from time to time, and we are at

13

page

at

requirement in its regula¬

We

Haioll's Waiting for V«n Older!

until

fixed

been

jrom

level

were

ly

Continued

comfortably

now

maximum

which the Home Loan Board could

contest.
possible

when

are

the

above

will find their handicaps and playing time posted at

teams

and

Thursday, September 14, 1950

...

tested

the point of

Mortgage Credit and

the

over

a

adjusting

our recom¬

mended minimum standard, as Mr.
will

Leete

about during

you

convention.

this

Inflation Controls

tell

Our preference is to

continue to
liquidity by
direct appeal rather than regula¬
tion. The fine degree of voluntary
compliance we have had makes us

handle this question of

is

up

step in the right direction.
note that it leaves out

a

will

You

any regard for the different sizes
and needs of institutional inves¬
tors. The Treasury

claims that this
relaxation of subscription limits
is only a trial balloon to test the
amount of funds available for such
I believe it will find

investments.

the end that nothing less than

in

tap issue of savings bonds will

a

have any

discretion in the matter,
to any truly national
adopted
to
influence
credit conditions. We do ask, how¬
ever, that the measures be clear,
that the efforts of the Washington
agencies be coordinated and that
the problem of controlling infla¬
measures

tion should not be

In his

Home

In

employing the new savings
we should be prepared also to co¬
ordinate our practices in mortgage
lending with the policies adopted
in Washington to hold back
tion.

Efforts to check inflationary
have

tendencies
in

the postwar

clusion
the

infla¬

of

scope

seemed

been handicaped

period by the

ex¬

credit from
of the controls. It has
mortgage

all

often

too

recent

in

years that Washington was follow¬
ing contradictory policies on credit

control.
the

One instance of this
that

fact

within

the

credit

all

was

"It

law <unto

He "is

NSTA in

Big

a
a

Since

time

Fella!

he

And

after

goes

advertising for the

Big Way.

1939 he has

the past 11 years.

This year's score is encouraging so far, but we're still waiting
order from many firms that should be repre¬

for the ad insertion

sented in

our

NSTA Convention issue of the "Chronicle."

Call him at

Pershing & Co., 120 Broadway, New York 5, N. Y.

—WOrth 4-43C0.

taken

the

is indeed happy to

report that our affiliates,

"These increased

affiliates

sc

far

materials

is

a

"It can be done."
great pleasure this week to mention the

of

mosc

respected members.

name

of

one

He is active in spite of

other du ies but needs no "Loyalty Test" to maintain
membership in our NSTA. He produced a quarter page ad from
a N. Y. bank and his name—Cy Murphy, John
C. Legg & Com¬
pany, New York. Thanks Cy and good luck.
I intend to place in your hands a memo of auotas and busi¬
mary

eral

produced by all our affiliates at our first National Committee
meeting.
says

recent

letter

we may pass

from

Ed

Welch, of Sincere & Co., Chicago,
the 400 mark in attendance at the convention,
a new high of over 100.
Looks like a new

with the ladies making
record

for

for many

convention

affiliates.

attendance

as

well

as

advertising results

Do I refer to you?

Reserve

B. SMITH, Chairman
Advertising Committee
Pershing & Co., 120 Broadway, New York 5, N. Y.

NSTA

ducted

arnual

second

at

the

NSTA

Calcutta

Covention

Golf

Tournament

and

contestants

will
will

be

con¬

have

the

selected

assure

by the Golf Writers' Association of America and thus
the participation of the finest golfers in the world.
It was

during this year's play that the Australian pro Van Nida, in a
practice session, got a hole-in-one on the 18th hole which is 200

yards,

all

water.

A

a

carry

and

a

green

on

parity

a

of

member

Board has changed the level
of

credit,

our

bank

reserves

as

a

tightening or relaxing
Banking Board has ad¬

residential

almost

completed

surrounded

6,ct>5-ydrd, par-89 golf course, the Cavalier Club
test to all NSTA golfers who participate in the Calcutta.
The Calcutta Committee is headed
by

by

offers

reduce

in

pressures

construction."

other

things,

nonmembers from

to

prevent

gaining

a

com-

petitiv^dvantage through being
permittee!

to

maintain

percentage amount of
We

have

decided

smaller

a

reserves.

views

on

the

issues where the states should be

■

follow the dictates of

to

in the
as

Department

ideas

liquidity percentage
favorably in sound¬
with ratios required by other

our

on

Defense Production Bill of

1950, enacted by Congress

Sept.

on

the President with wide
authority to control real estate
arms

construction

will

take.

down

credit.

what

known

If

the

is

It

not

the

form

yet

controls

regulations

national

a

policy

lay

mort¬

on

credit, the Banking Depart¬

ment will be

sider

just

whether

ready to

as

it

policy in its
it

as

has

con¬

supplement

can

It is

for

been

statute

directing
Board
a

years

important to keep in mind

regulation

in

June

Loan

Home

Bank

within six

to issue

bers. In

objectives. Take

approved

the

credit

between

control and other

the

some

coordinate nonmember
requirements with those

distinction

the

of discretion

area

to

reserve

4%

months

liquidity for mem¬
carrying out this mandate
on

above 8%. It does not ap¬

or

that the Federal regulatory

pear

liquidity is intended to
the supply or cost of
mortgage credit. If that were the
purpose
of the
regulation, we

power

on

influence

should

promptly consider whether

should not fall in line. Credit

we

in

country all regret the

the

shortest

at

will

institutions spe¬
cializing in mortgage financing.
The
supply of mortgages must
decline if we push our defense
preparations with the energy that
the
danger to our country de¬
mands.

lost

not

for

the

out

carry

turn

whether

they

wish

to

have many units and few branches,

the

minimum

few

a

or

a

we

of

the

should

operating

then

can

homes and
We

employment *

the point
institutions
must be part of the mobilization
for defense.
When you intensify
your efforts to
promote private
savings, you are gathering to¬
gether funds that can help in fi¬
nancing our arming and defense.
You
are
also
strengthening the
are

where

home

savings

front

inflationary
are

near

very

all

holding

by

pressures.

accumulating

the

our

After

feel

ticular kind

to

State,

our

all,

York

we

judgment.
that the New

own

Department

pioneer in setting
standard for

erating

impose

standard,

in

use

practice.

has

been

a

For

nearly 10
of this De¬

partment

maintain

a

a

liquidity
measuring op¬

up

Deputy Leete
has been advising

years

the

back
And

you

of

means

spreadyiii()aorne ownership with
normal vigor and enterprise

your

wide
a

perils from abroad have
varied

and

fields of

It

is

make the
of the opportunity for serv¬

challenge

most

are

usefulness.

to

you

to

ice that lies before you.

expect to follow

the dictates of

doing business in the
wherever they are char¬

cor¬

purpose

interest; on the con¬
trary, there is good reason for
allowing the states to choose the
branch policy
that best serves
their interests in the light of their
needs. The policy so chosen should
apply to all institutions of a par¬

nothing in this inconsistent with

belief is

liquidity regulation is to

or

units and many branches,
fair measure of each. There

that

rect

our

safety

home

building
the savings that have been ac¬
cumulating. The savings dollar
now
serves a double
purpose. It
suppresses
inflation
while
our
defense preparations are on a ris¬
ing scale. It will prove a valuable
national asset when peace is es¬
tablished, for it will provide both
we

States

however,

de¬

removed

national

our

into

that

is not

merely

have

we

threats to

now

is

It

good.
When

ferred.

construction

the

But

do

we

states.

If,

hard

a

savings

been removed. These

allowed

release
the de¬

strike

when the

again, lies properly
of national pol¬

say

to

to

materials

effort

blow

possible time.

taken

measures

fense

Control

1,

We in this

necessity of slackening our effort
to provide adequate housing for

construction

Given for Mortgage Credit

The

ness

icy.

decide

con¬

forming to high standards in op¬
erating practice, we expect that

the

be

in

are,

within

should

interested,

are

institutions

our

within the scope

the

own

.

control, I

of

our

judgment in this matter. As I say,
we
regard the liquidity standard
as presently applied to be separate
and
apart from national credit
policy. We look on it as lying
entirely
within
the
sphere
of
supervisory discretion. Since we

allowed to set the rules. The scope
of branch powers
properly lies

determination

associations

appropriate liquidity stand¬
But, in any case, we propose

ard.

all

mitted to pick a percentage under

among

obtain conform¬

to

nonmember

an

Any

Wide Government Authority

the Home Loan Board is not per¬

liquidity

you

ratio

on

formula of 20%. We have be¬

tered. It is sheer blindness to pre¬
tend that there are not regional

lieved that

differences

Roberts & Company is
Formed in St. Petersburg
(Special to The Financial Chhonicle)

ST.

erts

PETERSBURG,
&

Company,

Inc.

Fla.—Rob¬

has

been

formed with offices at 235 Fourth

Avenue,

N.

securities
Albert

E.,

to

business.

Roberts

engage

in

Officers

a

are

III, President and

World War II should be retained.

sheer

Stanley L. Roggenburg,

But

in this country and
folly to try to ignore them.

credit

of Roggenburg & Co., in New York.
Other members of the Com¬
mittee include Herbert*H. Blizzard, Herbert H. Blizzard & Co., of

Philadelphia; Jack Morris, Courts & Co., of Atlanta; Wm. F. May,

is national

May & Gannon of Boston; Fred J. Casey, Doyle, O'Connor &
Co., of Chicago; Jay L. Quigley, J. L. Quigley & Co., of Cleveland;
John B. Cornell, Jr., Dallas Hupe &
Son, of Dallas; Paul I. More-

is

control

different

is

from branch




al¬

of these
positive actions

cordingly. In following this policy
the Banking Board
has sought,

reserves

to

some

ac¬

nonmember

the national

pleasure of playing one of the nation's finest golf courses.
The
Cavalier Yacht and Country Club is the site of the annual $10,000
Cavaliers Specialists' Tournament.
Usually held in April, players
are

those

means

is

NSTA GOLF TOURNAMENT

System
required

member

to

HAROLD

The

against

banks. "Whenever the Federal Re¬

ness

A

maintained

required

justed

us.

of New Yorks

his

produced gross advertising that
confident our final results will sur¬

unless

taken to

are

tendencies

in

of Federal Reserve member banks.

of

all-time high.

have

has exceeded quotas and I am
It

an

evident

deposits

this

over

of

ance

regulation will not

a

authorities.

inflationary

ready

ready

have

that

necessary

vate

period
the re¬

We

serve

many

number

a

be

will compare

local.

efforts

prise

position for

believe

demands," the
President continued, "will aggra¬

the

Georgia Security Dealers Association and San Francisco Security
Traders Association, have gone over their quotas, and from the
San Francisco members should make

a

that credit policy by its
very nature cannot be regional or

with

being displayed by Jack Egan of First California Company,

as

quired in increasing amounts for
national defense purposes."

of banks not members of the Fed¬

Your committee

clear that,

already

materials used in residential

gage

has

years

serves

Nine

very

Reserve

their mortgage terms.
The
Banking Department

consistently

LIBBING

AD

the

At

Federal

applying restraints to lend¬
ing, and even to some extent was
raising the cost of borrowing to
the Treasury itself, the FHA and
VA officials were easing up on

of

and

President

and other construction will be re¬

to be

was

captained the NSTA Advertising Committee
which has brought in more than $50,000 to the National's Treasury
over

itself.
the

when

Housing

said:

is

many

Re¬

mortgage field has seemed
a

the

of

Finance Agency,

result of events of the last month,

authority with the notable
exception of mortgage credit. The

Smith, Chairman of the National Security Traders
Association Advertising Committee

pre¬

July 18 letter to the Ad¬

Truman

serve

Harold B.

a

put

of Federal

range

was

as

unrelated fields.
ministrator

Inflation

Back

Hold

used

extend Federal powers in

text to

fill the bill.
To

conform

to

policy. Credit control
affects the soundness of mobey^ It
fluid

state

or

and

lines.

it is
is

contained

expect

Banking Department,

so

in

far

by
the

as we

good part of the gain

liquidity
As

you

achieved

know,

our

during

formula

Treasurer;

is

free shares and borrowed money.

Federfib'formula is the per¬

centage that cash and government
bonds
The

are

of

total share; capital.

great majority of ouroasso-

Robert

Vice-President

Joins A.

the percentage that cash and in¬
vestments at allowed value are of

nothing./Credit /The

not

We

in

a

and

M.

J.

Jennings,

Secretary.

Kidder

(Special to The Financial Ch?.onicle)

FT. L A U D E R D A L E, Fla.—

joined the
Co., Ft.
Lauderdale National Bank Build¬

Frank
staff

ing.

K.

of

A.

Nelson has
M.

Kidder &

Volume 172

Number 4942

.

.

.

The Commercial and Financial Chronicle

(1001)

effort to stop this

Halsey, Stuart Group

"blackmail"—as he described the Argentine's
for unduly high prices. His position would become greatly
weakened, however, if Britain were to become dependent on the
Argentine for coarse grain as a result of the cessation of imports

Need of International Financial

pressure

Offers Tennessee Gas
Transmission
Offering

of

Defense Coordination

3% Bds.

mortgage pipe line bonds, 3% series

:

due

19/0

Tennessee

of

Transmission

Co.

Dr.

Gas

made

was

headed
Inc.

•

by

Halsey,

food needs and foreign

The bonds

were

.'public at 101 % %
r

terest

and

group
Co.
priced to the

Stuart

on

and grain to

and accrued in-

Of
•

the

by the

.these
;

proceeds

be received

to

from the sale of

company

bonds,

$35,000,000 will be
used to pay the company's pres¬
ently outstanding short-term notes
in

full.

Proceeds from the

term notes

were

diplomatic and

use

Argentina to adopt

proceeds, served the purpose of repaying
American firms.

more reason¬

an

manulaciurers oi machine
in

expansion

difficulties.

ish

tune

to

The

not

prepared to take steps

export licenses.
the

added to the general funds of the

.

and

.company

from

time

will

also

be

the

used

time, together with
other cash resources, for the com¬
pany's expansion program.,
made

be

may

and

operates

Or. Paul

Einzig

"The company's

•

main transmission

line on June 30, 1950 was
1,364 miles long, approximately

•

miles

600

through
'area

a

extended

which

of

natural gas producing
Louisiana. The

in Texas and

•company's principal deliveries of

the system of
:the Columbia Gas System
Inc.
and for the system of Consolidated
•natural gas are for

"Natural

Co.

Gas

The

company

a

sells gas under connumber of other cus¬

A

wholly-owned subsid¬

also regularly
•

tract

to

tomers.

iary, Northeastern Gas Transmis¬
sion Co. was incorporated in 1949
.for the

of buying, trans¬

purpose

mitting and selling natural gas at
'wholesale to gas distribution com¬

panies, municipalities and indus¬
consumers in the New Eng¬

trial

land

States,

and

because

machine

such

at

Street, New
York City, to
act

partici¬

as

pating distrib¬
utors and deal¬

securi¬

in

ers

through which Russia has been and

dent of Amer-

Securities

Freder¬
Terry

Corp.
ick

A.

was

V.-P.

and

Treasurer of
American

Charles G. Terry

curities
and
"of

Se¬

Corp.

prior thereto was an officer
Schoellkopf, Hutton & PomInc.

eroy,

is still in

Parliament meets this subject will figure

debates

national defense.

on

Overseas

for

tary

machine tools

a

be

in respect of exports

in isolation but

sold to

been

a

Cincinnati

headed by Nat Galey. The
company will continue under the
•same
management
with
Frank
group

Livingston
dent.

Co..

Louis

continuing
C.

Boston,

as

sold

are

a

position to buy

The Cleveland Electric

.

Illuminating Company

prominently during the

statement

declaring

that

the.

Public Invitation for Bids for the Purchase of

Russia in return for the sale to Britain

to

regarded from

an

essentially practical point of view.

The

for their

$25,000,000 First Mortgage Bonds, —% Series Due 1985

The Cleveland Electric

Britain essential for her economic

was

a

director

4hdl.^tibstantial holder of stock in
company,

arranged the trans¬

action and received

mo

Lerner has resigned as a

of the company.




fee.

Mr.

director

potential?

war

.

Ohio

hereby invites bids for the purchase
of $25,000,000

issue

transac¬

And would it be

Room 710,75 Public Square, Cleveland
12 Noon, Eastern Daylight Saving

on

September 19, 1950,

Statement referred

Although the goods imported from Russia and other countries'
the Iron Curtain include some strategic metals, the main

or on

be fixed by the Company

may

Conditions

behind

to

below.

Relating

to

a

as

such later dale

as

provided in the

Copies of

a

Prospectus

Statement of Terms and

Bids for the Purchase of said

Bonds, dated September 8,1950, and all other relevent

timber and

are

an

September 1,1950. Such bids will be received by

relating to such Bonds, of

the list of exports from Eastern Europe

whole of

Mortgage Bonds, —% Series due 1985, bearing interest
from

Time,

military

than Soviet Russia?

on

as a

principal amount of its First

1, Ohio, up to

impossible for Britain to obtain those goods from countries other

items

an

corporation (hereinafter called the "Company"),

the Company at

Are the goods received by:

of the two potential enemies.

power

Illuminating Company,

ex¬

effort.

war

grain. Neither of them are strictly strategic material, nor
they irreplaceable from sources not under Russian control.
Russian timber could be replaced by imports from the Scandina¬

referred

documents

coarse

to

said

in

Statement,

may

be

are

vian countries, Yugoslavia and, last but by no means

nomic point

tained

least, Canada.

sidered

of view it is greatly to the advantage of Britain to

of the major causes of the
trade

of

such

Beyond doubt one

and

economic difficulties of Europe is the

between

and

Eastern

Western

Europe,

as

to

the Western

of

price

have also played a part in

British

and

of

foreign

exchange

imports from Russia.

advantages

gained

through

Britain could afford to stop exporting
to Russia without

Beyond

a

The

solution under which

strtegically important goods

thereby making undue sacrifices by renouncing
in the establish¬

be

-

The imports of coarse grain from

istic instance.
the

Russia provide

a

Argentina would be the main alternative

utmost
on

character¬
source.

Her

dependence

the

tunity to hold Britain
Mr. Maurice Webb,

on

ransom

an oppor¬

by charging, extortionate prices.

the Minister of Food, has made

a

Room

on

710, 75 Public Square,

September 13, 1950,

prospective bidders for the

purpose

at

11:00

of reviewing

with them the information with
respect to
pany

the.Com¬

and its subsidiary contained in the Registration

Statement and

Prospectus and the Company's in¬

vitation for bids. All

be present at

Dated:

prospective bidders

such meeting.

September 8, 1950.

'

!

are

invited

'

?

--

1' :

The Cleveland Electric Illuminating Company

By Elmer L. Lindseth,

Argentine

on

provided the Perron Government with

at

It

importance, however, for Britain to reduce her

Argentine goods.

meat supplies has

security.

available

A.M., Eastern Daylight Saving Time, to meet with

to

of

representatives of the Company, counsel

Company, counsel for the successful bidders

representatives of the auditors for the Company

higher degree of economic and financial coordination

between the Democratic countries in the interest of their

is

forth in

set

including the filing of questionnaires.

Cleveland 1, Ohio,

doubt, amidst-

trading with Russia.

substantial economic advantages. The solution lies

dependence

Prospectus and only if made in accordance with

will

inducing the British Government to try

question is, would it be possible to find

a

con¬

only from bidders who have received copies of

Officers and

resources

prevailing difficulties Britain could ill afford to sacrifice the

of

Secretary of the Company,

Square, Cleveland 1, Ohio. Bids will be

and

Considerations

ment

the office of the

he ob¬

may

subject to the terms and conditions

for the

Hemisphere has increased and cannot

be reduced.

increase

copies of such documents

such Statement,

a

result of which the adverse balance of payments of Western Europe
in relation

at

75 Public

This is not done, because from an eco¬

import from Soviet Russia and her satellites.

reduction

examined and

grain could be replaced by imports from the Argen¬

coarse

determined

grain
were

to Russia should not be viewed and criticized.'

as

.

Dur¬
ing the last war and during many previous wars the. opponents
often made use of the intermediary of neutral countries to exchangegoods which they needed. They were prepared to strengthen their
enemy in return for receiving from them goods which could nothave been obtained from elsewhere and which were indispensable

Presi¬

Lerner, Lerner &

who

coarse

part of the general problem of the relations be-'
tween the Western countries with each other.
'
"
'
:

are

change of essential goods between opponents is not unusual.

economic

Control of The Ralston Steel Car
Co. has

deterioration of the British balance of- pay-,

financial policies of the Democratic countries in-

and

Meanwhile the Parliamentary Secre¬

issued

Trade

This:

the interest of their collective security. The official British attitude

which are badly needed by Britain.
The question whether or not the deliveries of machine tools
other goods useful for military purposes should continue must

and

to

Go. Control Is Sold

rubber.

unduly high price

instances which illustrate the need for a closer coordination of the1

of goods

her

Ralston Steel Gar

a

pay an

employ their strong diplomatic and economic influence in South

large quantities of natural rubber and other strategic raw material
Colonies. It seems probable that when

tine and other countries.

can

machine tools and

:

States that:

from British Dominions and

Terry

merly Presi¬

to Russia

achieved, without having to

r.-

United

number of jet aero engines were sold to Soviet Russia, and

ago a

Russian

for-

more inoppor¬
increase" Britain's:

to

in keeping with the

ties. Charles G.
was

tend

case

quoted by Mr. Churchill is by no means isolated.
policy as a result of which some years

The instance

It is

& Co. with of¬
fices at 44 Wall

any

This again could be achieved if the United States

commercial

liberty to inspect the works engaged in the

a practical point of view the
tions concerned tend to weaken or strengthen the relative

Fred¬
Terry

in

production of the tools, and they have excellent opportunities for
securing information concerning British rearmament.

passionately whether from

Charles G.
Terry and
erick A. Terry are forming

Britain:

America to induce the Argentine to adopt a reasonable attitude in
her trade negotiations with Britain. There are many other similar

Thus, instead of indulging in righteous moral indignation about
the British Government's attitude, the critics should examine dis¬

^,

will

beyond doubt to the interest of the

imports.
to

grain pur-,

that

ments, if Britain could become independent of Russian

;

Formed in New York

coarse

mean

This would hamper her rearmament to a considerable

end could be

tools

them

of

over

would

*

is

for it in the form of

contract, even
proprietors are

the Soviet Government to supervise

"

.'•pipe

accordance with

switching

Argentine

The additional deficit would be all the

Britain should not sell

badly needed at home by factories engaged
in arms production. Moreover, so long as the
deliveries continue the engineers appointed by

line

pipe

a

the

are

Tennessee Gas Transmission Co.

system for the transportation and
sale of natural gas at wholesale.

canceling

legal obligation to deliver

management

but also

enemy

•1013/4% to 100%.
owns

of

form

In the absence of such a step

under

goods in
its

the

the

to

highly excessive prices both for meat and for

rearmament

as

It

only because their machine" tools tend to
strengthen the striking power of the potential

at

ranging from 104%% to
100%. Sinking fund redemptions
may
be
made
at
prices
from

-

is

more

already owed'to*

money

extent.

fully aware that in doing so they are acting
against the interests of national security, not

.prices

•

firm

though

to

Redemption

in

action

take

Russia

trade deficit.

stop further deliveries. The firm itself has
some time been
pressing the government

to

a

grain. This would gravely increase her balance of payments;

coarse

facture and repair of tanks, and that the Brit¬

balance of the proceeds from the
sale of the new
bonds
will
be

,

from

would have to pay

tools, Craven Brothers, are still engaged

delivering to Soviet Russia machine tools suitable for the manu¬

com-

program.

ensure

This end could

credit basis, and therefore to adopt'
adamant and truculent attitude in the negotaitions with Britain.

chases

for

; pany's

to

a

In such circumstances the

course

Government is

be

But indirectly this enabled the Argentine to im¬

port more American goods on

of his radio talk on Aug. 26
Churchill inlormed his listeners that one of the largest British

Mr.

would

one against the other there is no hope for
bringing it to reason.
Unfortunately, in the precise moment when Britain made a firm;
sfand against paying excessive prices, the-United States unwit-.
tingly but none the less effectively strengthened the hands of the
Argentine Government by granting a dollar credit. It is true, the;

able attitude.
LONDON, Eng.—In the

The solution

the part of the Argentine.

on

the

induced by Britain's

British, and recommends U. S.

short-

used in the

materials by

war-use

was

exchange position. Says Russian grain

; group at competitive sale on Sept.
11 on a bid of 101.10%.

Europe.

be achieved by cooperation between Britain and the United States..
So long as the Perron Government stands a chance of
playing up

shipments of

economic influence to induce

the

Eastern

reasonable attitude

imported because of Argentine gouging in sales of meat

was

oc

awarded

were

Einzig, commenting

•Britain to Russia, contends situation

on

Sept. 12 by .an underwriting

;
'

from
)

By PAUL EINZIG

first

$40,000,000

17

■

.

President

18

The Commercial and Financial Chronicle

(1002)

Thursday, September 14, 1950

...

that

Let's Not Stifle Discussion!

Canadian Securities

of the Democratic party

we

are

stepped

major

the greatest attraction for foreign
capital, both from the apgle °f
security and the possibilities of
profitable investment,

preoccupation of the world's manetary authorities. The situation is
all the more complicated in view
of popular opposition to the imposition of direct controls, and the
fact that without some degree of
monetary inflation it will be impossible to finance the currently
projected defense programs. Re-

current exchange movement out of the U. S. dollar has
also extended to the Mexican and
Uruguayan pesos and sterling. The
present upward pressure on the
pound is especially significant in
view of its intimate relationship
with the Canadian dollar. It will
be recalled that it was only the

problem
of
inflationary
on
economies a.reaay
fully expanded by unprecedented
civilian

has been

sort

is

demand

now

made

a

here

to

ma-

tain

The

thus

the

cur¬

extent of the devaluation of ster-

of

moreover

the

markets

new

been secured

as

a

that

result of

the currency adjustments are be¬

result of the
war
emergency
conditions. It
would appear therefore that cheap
exchange has played its part but
is now no longer indispensable,
On the other hand the higher cost
of imports adds to the forces of
internal inflation.

maintain the ceiling on wages.

as a

For these

rea¬

and in the absence of a desirable alternative, the case for

sons,

the

own

A

10%

of

cost

upward

living

and

revaluation

Action of

this

kind

is

larly

appropriate in the
Canadian dollar, the

the

valuation

of

which

particucase

of

under-

is

becoming
increasingly evident. The growing

strength,of the Canadian dollar is
moreover

u,.

re-

valuation of the Canadian dollar.
" aI]y

study of this question the

effect of such action on the relahonship of the Canadian dollar
J1!? ? pound can not fail to be
*ak«n m*° .Account. In ^e
however of a similar

...

.

issue

of

the

there was limtheexternalsection

ada with its tremendous

-e Yu

econqiipk
growth potential obviously offerajrHS^/^ffii1

$fcJhS$dnd market but the de-

mranrf tot1 internal Dominions and
'Was

on an

unprecedented

'l&fcge* &bfale. Free funds

Provincial

CANADIAN STOCKS

also

were

the

Korea, will have
of

providing

an

the-effect

both

irfcrease in Treas¬

the rising
military expenditures and of acting as a brake upon the inflationury

to

revenues

cover

ary pressures now

estimated

that

the

present.

It

increases

was
con-

templated in various tax rates
would
together produce an increase in tax revenues of $4V2 to
$5 billion, on an annual basis, but
tax

experts anticipate that
yields will be much greatto the rising tempo of
business and higher levels of national
income.
Senator
George,
some

actual

er,

due

I/O

*

has announced the

.

m-n/i

_

Jiifi §&& no>

WM&&WO k

worth

4rii'6o
j

-

; f

7

ifljr "jiji&ts
>ii i/iih
Thir*

■

Geer
ited

of

the late Francis H.

'asjf^eheral partner and lim¬
p^jjer as trustee in Farr &

Company ceased Sept. 8.

Transfer of the Exchange mem¬

bership * of

Boston O, Mass.

McEneaney

the

rea,

machines,

change the provisions adopted
1948

computing the total

auction

and

An increase is made in

the

com¬

surtax

corporate
income from the
former 38% to 42% on 1950 in-

on

come,

and to 45%

tax

payable,
community
property principle. While the in¬
crease
takes place, theoretically,
as of Oct. 1, 1950, the tax payable
on
1950 income will be computed
on

the

total

income

for

the

full

There

1951 income,

Finance Committee to replace the

late

Edward

V.

with

Edward

G.

Mc-

individual

income

tax

increases, to retain revenue-raising provisions which would close
"loopholes,"
and
to
raise
the
House-approved scale of increases
in corporation taxes.
|
This

Senate

is

substantially

Finance
Not

only

what

Committee
were

the

the
has

provi-

sions for excise tax reductions de-

terest to observe how rates of in¬

constantly and in¬
upwards from modest

exorably

are

on

Restoration
of
the
beginnings.
provisions for prorating wartime rate of 20% on all income
on companies having
after
a
$1,200 exemption for a
fiscal years ending on dates other
married couple contrasts with a
than Dec. 31, and for preferential
4% rate in 1939 after an exemp¬
treatment of the large number of
tion of $2,500.
When the federal
small corporations by imposing on
individual income tax was first
the first $25,000 of taxable income
authorized
in
1913, the normal
rates of only 23% in 1950 and 25%
rate was but 1% after a personal
in 1951. This eliminates the obexemption of $4,000, while the
jectionable "notch" provision of
graduated surtax started only at
the former law, which had rates
$20,000 and rose to a maximum of
graduated upward
applying t o but 6%. Under the new
bill, the
corporations with incomes under combined normal and surtax rises
$25,000, but very high rates to
to a maximum of 91%.

a rate of over 40% on corporate

When the Federal Governfirst authorized by Con-

was

stitutional

amendment

income taxes
rate was but 1%.
levy

the

in

1913

to

corporate

a novel

provision introduced in
requires that corporations
step up the proportion of their annual tax pavments that are made
during the first two quarters of
the following year. Instead of payjng} as heretofore, instalments of
25% of the total tax each quarter,
corporations after Jan. 1, 1951 will
pay 30% of the total tax in both
this bill

the

March

and

June

quarters,

1951

Tax

Legislative

Plans

In

advancing the present tax
bill, the Administration and Con¬
gress have recognized the desir¬
ability of framing a measure that
would be as simple and non-con¬
troversial
as
possible, and that
could be put into effect promptly
for increasing government reve¬
nues
and
checking inflation. It
was planned that this "interim" or
"quickie" measure would be fol¬
lowed up after the first of the year
by
additional
tax
legislation
which might be needed but would
be of a more complicated and con¬
troversial nature.
President Truman has indicated

that he

intends to

ask for

a

cor¬

profits tax, and
there is much political pressure
for this type of tax. This is true
despite its many inequities, the
difficulties experienced in. its
ministration, andt J|^,,f^teg§^^^
porate

excess

imposing-on: therjfjeiaancjaty

which, in effect, ^penalizes* prfcg<*
ress, when the c$uft£?^3k

Eneaney will be considered by the leted, but such taxes were extendleaving 20% in the September and
ed to television sets, deep freez- December quarters. It is provided gaged in
on S^pt. 21.

Exchange

income taxes have tend¬

dividual

ed to be pushed

the increase

by the 11%.
Following ment

January.

of hostilities in Ko-

Mr. Truman, asked the Senate

done.

to

in

the outbreak

bill

Fifty Congress Street




are

in accordance with the

The

following firm proposed excise cuts of the House

changes:
Interest

hi

ing economy."

President

Weekly Firm Changes

IINCORPORATE!)

Taxes

for more liberal depen¬
dency allowances and for a split
in the income of joint returns in

Program

bined rate for normal and

tax recommendations made

The New York Stock Exchange

iuhit

Income

raised practically back to the war¬
time peak, although the bill does

income represents a new high for
bill, as recently approved all
time,
except
when ,,excess
movement, but the base-metals, by the Senate Finance Committee, profits taxes were added during
and Western oils were also well to represents a complete revamping World Wars I and II. Normal and
the
fore.
The
golds were less of the House-approved tax read- surtax combined in the period
buoyant but nevertheless regis¬ justment bill intended to cut back 1942-45 was 40% for the larger
tered fractional gains.
wartime excise taxes in line with corporations,
while in 1939 the
—but to a greater extent than— rate was 19% and in 1929 it was
pre¬

New York Stock Exch.

A. E. Ames & Co.

Individual

of

Individual income tax rates

strong and wider premiums Chairman of the Senate Finance
were quoted on future deliveries.
Committee, is quoted as expressAt 10%%-10% the corporate-arbi¬ ing the view that "by increasing
trage rate remained virtually un¬ the rates to pick up $5 billion on bridge the gap between that fig—
changed. Stocks advanced sharply the basis of the present economy, ure and the $50,000 level at which
following the special budget ad¬ we actually will get $8 to $10 bil- the standard rates applied,
dress which removed certain ap¬ lion,

prehensions that had existed
viously. The industrials led

Corporation

depreciation charge in com¬
puting taxes would be available
only on new properties certified
as essential by the government.

text of the article folfull

because^ of the fast expand-

Municipal

generally and

erated

in

slot

apply

based upon the estimated use¬
ful life of the assets. This accel¬
are

ness standpoint, however are the each part separately.
increases made in the rates of in¬
Withholding taxes on individual
come
tax upon corporations and
income will be raised, as of Oct.
The prompt action by Congress individuals, estimated to augment
1, 1950, from 15 to 18%, after the
in expediting a bill to increase tax
receipts by $1,500,000,000 and usual allowance for
personal ex¬
Federal taxes substantially, as rec$2,700,000,000, respectively,
emption and dependents.
ommended by President Truman
Here again, as in the case of the
Corporate Tax Increases
following the outbreak of war in
corporate income tax, it is of in¬
The

very

Government

ers,

which

rates

lows'

...

deferred

CANADIAN BONDS

at a rate of 20%
annually, rather than at the lower

Rise

current

of such facilities

for tax purposes

of

adjustment
by the cur¬
of the pound the existing relation¬
rent weakening trend of the U. S.
would
remain
unchanged.
dollar which is clearly demon¬ ship
Whether or not any immediate
strated by the recent heavy outflow of gold from this country.
$n —
regard to sterling, the decision to follow the
Foreign flight capital is now com¬
logic of events can not be indef7
mencing to move from the prevai¬
ously considered safest havens, J?
J.
in the case of the
this country and Switzerland. Can- Canadian dollar,
~

accentuated

we

September issue of the "Monthly Bank Letter" of the National
City Bank of New York discusses current tax legislation along
with 1951 tax plans and budget prospects.
Holds slash in
non-defense spending by Federal Government is imperative.
The

equipment provides, as did
War II tax legislation, for

the amortization

"Monthly Bank Letter," published sales of furs and jewelry. Retenyear 1950, with adjustment for the
the pound would almost auto- by the National City Bank of New tion of certain provisions for closfact that the higher rates apply
matically lead to a corresponding York, contains an extensive an- ing tax "loopholes" is calculated
for only one-fourth of the year.
adjustment of the Canadian dollar. alysis of the pending Federal tax to raise $300,000,000 of additional
This will avoid the complications
Despite the customary official program as well as 1951 and 1952 revenue. Of primary importance
of having to divide the year's in¬
denials of intent to take any ac- budget prospects
from both the revenue and busi- come and to compute taxes on

eration is now being given to

purpose.

World

wonder, is the Truman foreign

The Federal Tax

to

is
If
only to check the inflationary tide
set in motion by previous devaluation, an upward currency ad- tion in the field of exchange there
justment would serve a useful is little doubt that serious considupward currency revaluations
becoming increasingly strong.

lated

not

sible position with regard to its
fight against inflation. In the
event of a rise in the value of the
pound the resultant cheapening of
essential imports would greatly
assist the official efforts to hold

ing consolidated

run.
Corporations
during the speed-up
the double burden of

them earlier.
provision in the law designed
to encourage business outlays for
construction of new plants for the
production of armament and re¬

Why this eternal attempt to stifle discussion of
foreign affairs?

continuance of the official freezing of wages, places the Labor
in an almost impos¬

without being increased

A

icance?

Government

ac¬

to pay

struggle against tyranny."—
Nice, Keynoter at the recent Demo¬

In what sense, we

of

be

pay more taxes under
increased rates and of having

the

With such united efforts

collection
would

long

by
having to

policy "bipartisan"?
And, may we not have honest and frank exchange
of views on these questions of such vital signif¬

suggest

the

period

cratic convention in New York State.

that action along these
lines might not be long deferred,
The recent vote of the British
imports. At the present time Trade Unions' Congress against

have

Louise

basis,

would be hit

nation.

and of defense.

war

Miss

dollar.

dian exports have expanded and a
check has been imposed on excessive

in

cannot fail to win this

Now
it would appear that a
devaluations of last September have played a large part sound case exists for a correction
in creating an upward pressure on cf the excessive devaluation of the
the price level. They did however pound from its admittedly undercontribute towards the re-estab- valued
level of $2.80. Current
lishment of a healthier balance of conditions in Britain furthermore

European and Cana-

a

in

pay¬

preceding year's

revenues

celerated

the American people to rise above
politics in this crisis, as they have done in the past,
and to support the positive and constructive mea¬
sures for defense against aggression and for even¬
tual peace in the world. Let us keep our minds on
lasting peace while our hands prepare our weapons

rency

world trade.

Treasury

field for political bickering,

"We call upon

the

In Canada and Europe

as

50%

quarters,

the

Through this feature, which has
advocated
as
putting cor¬
porations more nearly on a payas-you-go

no

the

on

full

in

been

proved. By such tactics, misguided and selfish men
play with men's lives and endanger our very exist¬
ence

covering

ments due

field for slanderous accusations that cannot be

no

vast September to the anticipated level
sums
that
will
ultimately
be of $3 or $3.20 it is probable that
needed to meet the present emer- the Canadian dollar would have
remained at par vis-a-vis the U. S.
gency.
financing

of

further, so that after

up

income.

freedom.

our

"Foreign policy is

nipulation of the rate of interest ling that led to an accompanying
but the uncertainty
engendered adjustment of the Canadian dollar,
serves
only
to
complicate
the Had the pound been devalued last

problem

the payments
quarters will be

years

years they will be
both the March and June

proud of

foreign policy; proud of our Administration's
quick action against aggression. We call upon sin¬
cere
Republicans, who believe in a bipartisan for¬
eign policy, to rally to the support of President
Truman, our leader in this great struggle to main¬

By WILLIAM J. McKAY i
The

later

first two

five

"Yes,
our

pressures

in

the

in

a

full-scale war but ,isj#

Volume 172

Number 4942

..

;

The Commercial and Financial Chronicle

(1003)

1®

Balance

Sundays in

a

year

Balance
Half

„

day Saturday all

year____

Balance

Legal holidays in year
Balance

One hour

a

day for lunch

Balance
Two weeks'

vacation

Balance for work:

one

day

Securities Sales man's Corner

Total
Total

expenditures
receipts

42.4

45

37.3

45

Budget surplus or
deficit




20

The Commercial and Financial Chronicle

(1004)

from banks in order to complete the

Public

selling on the Curb around 21 and has had
24%-17%.

Utility Securities

sideration

*

Duquesne Light Company

Duquesne

Light Company, serving the city of Pittsburgh
adjacent territory, is 100% controlled by Philadelphia Com¬
pany, important sub-holding company in
the Standard Gas &
Electrid 'system.
The future earning-power of Duquesne will
largely determine the eventual break-up value of Philadelphia
Company common stock, and will thus be an important factor in

a small railroad company
which hauls coal for Duquesne. Philadelphia Company will later
use the Duquesne preferred stock in a program to retire its own

remaining preferred stocks.
After adjusting Federal taxes against income to a separate
return basis, selected items in the Duquesne income statement are
as follows in millions, including estimates for 1950:
Adj. Net

Revenues

—

'

"

/
1940

.

Adj. Net

$34.4

$12.7

$10.1

37.9

10.6

8.0

1942

40.4

9.8

7.1

1943

43.6

9.5

6.6

i--

$8.7

45c

to

Continued

from

43.9

9.5

43.5

9.8

42.6

10.5

7.8

1947

49.9

12.4

1948

55.9

L949

56.5

♦Assuming

a

new

pro

present financing

continuation

a

the

of

Chicago metropolitan area.
57%

About
population served is

the

of

South

Bend, Hammond and East
Chicago, Indiana.
The territory
represents about one-third of the

the

both

the
ac¬

35

past

years,

tions,

much

7.9

a

8.6

7.2

western district.

10.9

8.8

7.4.

ern

tax

rate

applied

to

the

calendar

should

they

be

not

bur¬
tflA,

et.*

The

management

Indiana

is

Northern

of

aggressive and
employee relationship is good.

the
The

very

with

program

sa^e.y

participation

ployee
further

resulted
of

reduction

em¬

in

lost-time

The training program
for gas service men, electric line¬
men a
d we ders, which has been
accidents.

for

on

five

expanded.

being

is

years

whole

the

or

entire

The northwest¬

part of the company's

is

tory

natural

a

industry, laced with
year

dividend

earnings (which included substantial system tax*
savings due to consolidation, in all years since 1940) ranged from
about $3.75 to $4.45 during 1940-49. Dividend payments have also
been quite steady between $3.70 and $4—a high payout. Esti¬
mated pro forma 1950 earnings approximate $8.6 million or about
$4 on the 2,152,828 shares outstanding, after adjusting taxes to
a separate return basis with a 42% Federal rate.
Savings derived
from present consolidated tax returns are expected to taper off,
amounting to about $1.2 million in 1950 and $750,000 in 1951—they will, of course, disappear altogether after the break-up of
the Standard Gas system.
Reported

Duquesne's generating capacity has been inadequate to handle
peak loads, and last year's installation of an 80,000 kw unit

(capacity) was the first since 1942. The retarding effects of high
qperatihg costs on net earnings during this period is indicated inthe above table. However, present plans provide for the addition

as
middle

terri¬

center for
network of

a

railroads and fine highways.

The

principal industries in this terri¬
tory include steel, railroad equip¬
ment, oil refining, food products,

automobiles,

electric

equipment

and cement.

With

was

ity

being

stocks,

would

fare

not

of

Herewith is
tors

fear that util¬

a

peace
issues,
well as stocks

as

companies.
How¬
immediately
apparent that utilities are vital to
it

ever,

becomes

of the fac¬

choice

my

Indiana

Public

stock

Co. common

as

of

Service

favorite

my

An operating

increased

The

(2)

in

revenues

since 1933.

every year

offers

utility which

gross

$1.40

dividend

$2 09

(3)

share.

oer

lation

popu¬

industry in this terri¬
tory o™er excellent aporeciation
possibilities in its common stork.
(4)

Gross

revenues

are

ap¬

future.

near

(5) Mainly

of 350,000 kw in the

there

the previous

porate taxes this year.

a transmission and
distributing
company,
with
no
large investment in gas manufac¬
turing and electric plants, but
with very favorab^ gas and elec¬

being regulated,

tric lom?-ter™

period 1949-52, an increase of about 50% Over
capacity, and providing about a 15% reserve margin.
At
present costs, the new units can produce electricity at a
station cost of 21/*—3 mills per kwh.
This will replace power
which the company is now buying at 1.5-1.9 cents per kwh or
more, and some generated power costing as high as one cent
per kwh.
Total cost of construction is estimated

Operating

million in

funds irt0193arid $7.5 million in 1952,
likely that it will not require any
equity financing to maintain the current 30% equity ratio.
is

estimated.

It

January this year Duquesne requested

a

$7.5 million rate

the Pennsylvania Commission (the first general
application in its history).
In its application the company
presented the following rate-base figures (including working cap¬
ital of $10.7 million): reproduction cost new, $400 million if based
on spot prices,
or $375 million if based on three-year average
rate

prices; original cost, $235 million;

and depreciation figured

24.8% compared with a book reserve of 26.8%.

at

The commission

past cases determined the rate base by taking an ap¬
proximate average of net original cost and net reproduction cost.
A 6% return was asked by Duquesne, which rate the commission
has allowed in the recent Bell Telephone case and in other electric,
has in some

Utility cases. Using calendar year 1950 estimated income figures,
percent earned on the rate base in 1950 should be almost the.
in 1949, allowing for increased plant.

same-as

The

present

In

outlook

for sustained

activity

in the steel in¬

the

York

the dividend rate

has been

$3.85 but it

is

understood*'^hat the' management intends to raise it to $4 in
September. A $4 dividend pay-out would' mean dividend income

Philadelphia''Company ;of $8.6 millidd.:i Under

more

normal

market, conditions the Duquesne stock could perhaps be valued on
a 6% yield basis, if earnings coverage was fairly satisfactory.,
This would mean a value of about $143 million. Assuming that;
Philadelphia Company might be able to retire all its senior liabil-;
ities without having to dispose of any Duquesne common stock,

indicate

an

estimated

break-up

value

of about

26.;

However, it appears possible that Philadelphia Co. might have to
borrow some $15-20 million from its parent (Standard Gas) or




of

course

address

an

at

State

dent

of

South

the

ad¬

vocated

credit,

follows

it

that

d

not

savings

institutio
consider

also

n s

their

the

"rented

i

n

tor of

/'Let

Andrew

S.

Roscoe

the

Roscoe told

the

convention

Mr.
dele¬
race

enjoyed, "at various
a

forded

The

of

some

good

social

times, much
freedom, it was
decades ago that the

material
few

credit

has

been

recognition

and

for

as a

economic

of

its

old

bold

dis¬

seem

theory

prosperity,

that

was

an

personal property until he has
price.

save

I

the

credit;
of

It acts

credit

of

and

it

the

"at¬

declared,

homes

is

a

as

the

the
in

other

distributor-

trustee

credit.

of

success

of

guardian
The

of

that

of

measure*

retaining

this

freedom depends upon our ability*
to maintain that trusteeship
on'

highest possible economic and
plane."

moral

KaJsey, Stuart Oroup
Offer Pa. RR. Equip'fs j
Offering of $10,005 000 Pennsyl—
RR. 2V2% equipment trustcertiifcates, series A, maturing an¬
nually April 1, 1951 to 1965, in¬
clusive, was made yesterday.
(Sept. 13) by Halsey, Stuart &:
vania

Co.

Inc.

associates.

and

The

cer¬

tificates, issued under the Phila-delphia Plan, are priced to yield
from 1.60% to 2.75%, according tomaturity, and are being offered*
subject to approval of the Inter-'
Commerce Commission.

state

of

trust certifi¬

$20,115,000

cates,
series Z.
The aggregate,
principal amount of these certi-ficates will be used to provide for;

railroad'
to cost not-

standard-gauge

new

equipment estimated
less than $25,143,750.

With

Blair, Rollins

(Special to The Financial Chronicle)

CHICAGO,

111.

—

has joined the

mann

Rollins &

Paul T. Hestaff of Blair,

Co., Inc., 135 South La

Salle Street.

E. E. Mathews Adds
(Special to The Financial Chronicle)

BOSTON, Mass.—Donald E. Pit¬
has been added to the staff

man

of

Edward

Mathews

E.

Street.

State

Co.,

53-

'

.

and accumulate

how

wonder
could

be

many

manufac¬

Joins Conrad, Bruce
(Special

SAN

James

to The

Staff

Financial Chronicle)

C a 1 i f.—
rejoined the

FRANCISCO,
P.

Alles

has

staff of Conrad, Bruce & Co., Russ

recently with

Building.

sets, refrigerators and other items

Harris, Upham & Co.

could
of

be

the
Since

to

distributed

old

on

the

He

Paul Tissol

phases
so

of

business

important

for millions of

Optns

credit enters in¬
NEW HYDE

many

was

basis

theory?"

consumer

constitutes
our

Roscoe

savings of its members'

tured, how many radios, television

af¬

and

Mr.
the

finance

economy.

automobiles

force

progress."
measure

our

been able to

you,"

gates, "that while the human

freedom

the

make

individual should not acquire real
or

remind

me

"I

of endeavor that

"The

en-

g

consumer credit field.

other

tion,"
tracts

the

tant from the home financing see-

activ¬

by

that

function of the home

a

York State's savings and
associations, at the end of last'
year,
had $1,274,000,000 in re¬
sources, $1,131,000,000 in savings^
and
$1,002,000,000 in mortgages,'
Mr. Roscoe pointed out. The vol¬
ume
of
savings in the average'
savings and loan office, he said/
amounts
to
$4,190,000 and
the
average
mortgage
portfolio
is
$3,710,000.
"The savings and loan associa¬

orly in academic thinking, but
in business practices and in

fields

broadening of

a

New

savings and loan
movement can be justly cited with
the great change that came about,

of
e

continued.

as

loan

capital, that we call credit,
is
equally important for the well
being of our trade and commerce,

claim

and

that

fpr

ity of capital. Hence, Mr. Roscoe
asserted

he

ex-

recommend

but

in im¬
the availabil¬

depends

upon

operation and freedom of credit,"

free¬

and

pansion

-

said,

portant degree

flats

financing institution."

issue

"The savings and loan concept
incarnates mutuality, spirit of co¬

As¬

sociation

e r

Roscoe

Mr.

those

And, I further sub¬
financing of every
family within that home

second and final installment of an

Savings

dom

need of

for the well being of our people."

Loan

the

These certificates constitute the

Brook-

1 y n

and

heaters, "in which saturation is relatively low.

would

S. &L Ass'ns

field.

consumer

Savings and Loan
League at Saranac, N. Y. on Sept.
12, Andrew S.
Roscoe, Presi¬

t

this

cor¬

the annual convention of the New

ities

to

can,

in

Utilities,
when neces¬

the

dustry, is a-favorable factor in the improved earnings outlook, and
the company is also developing a program to stimulate residential
sales through the greater use of electric ranges and hot water
In reCent" years

increase

new

increase, from

the

no

President of South Brooklyn Savings and
Loan Association, sees opportunities for extending loans to

appears

"

In

be

Andrew S. Roscoe,

three-year period 1950-52, averaging about $25 million a year.
currept financing will take Ctire 'bf 1950 requirements and
leave about $3 million cash for n^t^kiVf:The company will need
it

will

a fa¬
believe

We

status.

Advocates Consumer Loans

at $75 million for the

The

about $12

utilities have

tax

we

on

times,

the

constitutes

and

the

the

earning capacity.
vorable

but

owners

all

at

consider

to

that

the

Continued growth of

output—it

sustains

right

freedom

annual

yield of 6 6/10%: latest
earnings.
12
months ,.(6/30/50),
a

In
helping to increase this industrial

increase industrial production.

turn

home

it,

members.

(1)

-

has

proximately 60% from electricity,
38% from gas and 2% from water.
Company expects to increase its
gas
business substantially over

in

do

their homes.
mit

to

security:

armament

of

a resume

underlying

Northern

in

war

life

surance,

were

outbreak

the

Korea there

Group

now

plans have been maintained.

increased

old

our

ask for increased rates. This ters, and at the present time, it
also apply in the case of is not within our province to served
these families. But, home financ¬
excess profit taxes at a later date.
A strong case is being made for ing is a broad term and I respect¬
utility companies in that since fully submit that the families who:
live
in
apartments
have every
they are subject to rate regula¬

rapidly than in either the state

9.3

8.6**

refrigerators, deep freezers, wash¬
ing machines, dish washers and
other appliances with the cost in¬
cluded in the price of that
new^

would

in¬
hospital
and
surgical
insurance, sick leave and pension

have

ranges,'

sary,

tivities in the northern section of

requirements after completion ofwill approximate the old figure of $1.4 million. "•

program

is

10.7

income

forma preferred

which

urge^

we

gas

of a rigid pattern.
"Many of our families live in
multiple dwellings, in rented quar¬

Indiana

|

.

operating utility serves an
population of approxi¬
mately 800,000 people in a 12,000
Square mile, highly industrialized
and rich farming area of northern
Indiana, the northwest portion of

population and the industrial

5.2

provisions for modern

for

carried

; 5.5,
.

10.0*

Federal

This

estimated

6.4

•

42%

excellent

obtained

have

investment results.

In

5.2

6.9

1946

m

field.

"We finance homes and

house," he said. "We can provide
financing of such equipment

I Like Best

Indiana Public Service

Northern

the

basis

The Security

5.7

6.6

1945

Est.

give active con-'
broadening of
their lending activities jn the con¬

must

common

savings and loan

to

to

the

1

2

page

entire state of Indiana.

6.6
-

1944

the

was

The current indicated

$1.80, the quarterly dividend having been increased from
on July
1. This of course increases the yield (at the
recent price around 2414) to about 7.5%.
40c

in the cities of Fort Wayne, Gary,

Adj. Bal.

Oper. Rev.
Income
for Common
(In millions of dollars).'■*

1.941

♦♦The

Light in this
given at $1.65,

allocation

jphia Company for cash plus the stock of

1050.

dividend rate

the 12 months' cumulative rate.

was

&

a

t$12 million new-money bonds on Aug. 28, the future refunding
of the $27.5 million-5% preferred into a 4% issue ($50 par), and
later the competitive sale of $7.5 million additional preferred.
The present new issue of 4% preferred is being sold to Philadel-

1950

Power

better way«of life, Mr.

a

associations

*

Utah

on

is

rate

plan of Standard Gas.
Duquesne in 1949
big construction and finance program, which is ex¬
pected to improve earnings substantially during 1950-52—minus,
of course, the possible inroads of heavier Federal income and
excess profits taxes.
Duquesne's current financial program includes the sale of

Xear

article

the

department (Aug. 31 issue) the

and

final

*

this year of

range

a

acquire

Roscoe urged the

sumer

which

the

Thursday, September 14, 1950

.

to

Correction—In

initiated

.

retirement of its senior obli¬
gations, in which case the break-up value (estimated as above)
might approximate $22-23. Philadelphia Company is currently

By OWEN ELY

,

.

American

a

and

vehicle
fam:lies

A. Tissot

is

PAR'fe^^—Paul

engaging ,jn

a

securi¬

ties business from offices at
New

Hyde Park Road.

1728

Volume 172

Number 4942

..

.

The Commercial and Financial Chronicle

(1005)

21

Security Traders Association of New York

Tom

Feeley, Billings & Freedman; John M. Mayer, Merrill Lynch, Pierce, Fenner &
Behne, President of the Security Traders Association of New York; Giles Montanye,
H. M.

Pete
&

Brochu, Allen & Company; Harry A. Michels, Allen
Company; Jack Bloom, Public National Bank &

Roggenburg,

Co.

Roggenhurg

&

James V.

Torpie, Torpie & Saltzman; Chas. O'Brien

Murphy, Merrill Lynch, Pierce, Fenner & Beane,
Chairman of the Entertainment Committee

Co.; Lou Gibbs, Laird, Bissell & Meeds;
Co.

John

French, A. C. Allyn & Co.; Gus Levy, Goldman, Sachs &

Hal

Murphy, Commercial and Financial Chronicle; Harry L. Arnold, Paine,
Jackson & Curtis; John McLaughlin, McLaughlin, Reuss & Co.




Chronicle; Harold B. Smith, Pershing & Co.

Byllesby and Company, Incorporated

Trust

Stan

Edwin L. Beck, Commercial & Financial

Webber,

D.

Jerry Burchard, Charles King & Co.; Herb Hipkins,
Charles King & Co.; Ed Gutberlet, Paine,

Webber, Jackson & Curtis

Raymond Kenney, D. Raymond Kenney &

Co.; Gene Brady, Herbert E. Steam &

Co.; Charles D. Ogden, Ogden, Wechsler & Co.-;

Lou

Inc.; J. S. Alberti, Walston, Hoffman &
Edward W. Russell, Edelmann & Capper; John J. O'Kane,
O'Kane. Jr. & Co.: Joseph H. Lederer, Philips & Co.

Walker, National Quotation Bureau,

Goodwin, New York City;
Jr..

John J.

Bob Franklin, M. 5. Wien & Co.

22

The Commercial and Financial Chronicle

(1006)

Annual Outing

Tom

Love, George E. Snyder & Co., Philadelphia; Michael J. Heaney,

Micael J.

Pete Brown,

Greiner,

Co.; Ely Batkin, Batkin & Co.;
Adler, Goldman, Sachs & Co.

Joseph A. Monahan, J. A. Hogle & Co., New York City;

& Co., Philadelphia; Fos Webster, Hardy & Co.; Jim
McFarland, H. M. Byllesby and Company, Incorporated,

Louis P. Singer, Troster, Currie & Summers; Larry Wren,
Allen & Company; John D. Hines, Dean Witter & Co.,
New York City

Walter
•

F.

Tellier, Tellier & Co.; Peter J. McDermott,
Co.; Jeff Mendell,

Peter P. McDermott &
Peter

P. McDermott

Ted Plumridge, J. Arthur Warner & Co., Incorporated; Tom Krug, Bioren & Co.,
Philadelphia; Ned Phillips, Samuel K. Phillips & Co., Philadelphia; Addie Donnelly,

Reynolds & Co., Philadelphia; Mark Stuart, Cowen & Co.




Thursday, September 14, 1950

Reg Knapp, Wertheim & Co.; Eddie Christian, Janney

Dobbs &

Lou

.

Boettcher and Company, New York City; Everett F. Wendler, Connie
Sheridan, and Robert E. Eble, all of Mitchell & Company

Philadelphia

A1

.

September 8th, 19SO

Heaney & Co.;. James F. FitzGerald, W. L. Canady & Co., Inc.; John M. Hudson,
Thayer, Baker & Co., Philadelphia

William T. Meyers, Gordon Graves & Co.; Raymond
Forbes, Merrill Lynch, Pierce, Fenner & Beane; Desmond
McCarthy, Union Securities Corporation

.

Ken

Howard P. Frey, Howard P. Frey & Co.; Joseph

Janareli,

Joseph Janareli & Co.; Bill Wittich, Grimm & Co.

& Co.

Howard, J. A. Hogle & Co., New York City; Stan Dawson-Smith, Bonner &
Gregory; Carl Swenson, G. H. Walker & Co.; Walter O'Hara, Thomson & McKinnon

«,»

Volume 172

Number 4942

.

.

.

rwwrfl

The Commercial and Financial Chronicle

(1007)

2T

At New York Athletic Club

Gerard F.

Hulsebosch, Herzog & Co., Inc.; Arnold J. Wechsler, Ogden, Wechsler &
Co.; R. Sims Reeves; Ted Wechsler, Hay, Fales & Co.; John Fitzgerald, W. C.
Pitfield
& Co., Inc.; Stanley C. Eaton,
Bendix, Luitweiler & Co.

Bob
&

De Fine, Wertheim &
Co.; Stan Shaw, Josephthal
Co.; Hank Serlen, Josephthal & Co.; Jack Hunt,
Stroud & Company, Incorporated, Philadelphia

Weissman, Siegel & Co.; A1 McGowan, Seligman, Lubetkin & Co.; Irving
Ittleman, Frank Ginberg & Co.; S. F. Moss, National Quotation Bureau, Inc.;
Alfred F. Tisch, Fitzgerald &
Company, Inc.

Mitchell, Blair F. Claybaugh & Co.;
Strauss, Morris Cohon & Co.;
"Hoy" Meyer, Gruntal & Co.

Abe

Lienhard, Troster, Currie & Summers; Walt Filkins, Troster, Currie & Summers;
Irving J. Silverherz, Hay, Fales & Co.; Bert Pike, Troster, Currie & Summers;

Gold, Siegel & Co.; W. J. Candee, Butler, Moser & Co.

Harry D. Casper, John J. O'Kane, Jr. & Co., Chairman of the Sports Committee;
"Duke" Hunter, Hunter & Co.; Tom Greenberg, C. E.
Unterberg & Co.; W. D.
O'Connor, Fitzgerald & Co.; Dan Hannafin, Joseph McManus & Co.




Bernie

David R.

Bob

Ben

f

Samuel E.

Magid, Hill, Thompson & Co., Inc.; Dick
Roberts, R. C. Roberts & Co.; Bill Boggs,

Hill, Thompson & Co., Inc,

Micky Pinkus, Troster, Currie & Summers; Dick Montanye, Laurence M. Marks &
Co.; Crandon Leahy, National Quotation Bureau, Boston; Bill Weiffenbach,
Theodore Young & Co.; Theodore R. Young, Theodore Young & Co.

Harry

MacCallum,

Dominion Securities

Jr., MacCallum & Co., Mount Vernon, N. Y.; John C. Calef,
Corporation; Tom Hickey, J. W. Sparks & Co.; Henry G. Kuipers,
Griffin, Kuipers & Co.; Tom Canova, guest

f

f'W>9#S<Sl'

'24

The Commercial and Financial Chronicle

(1008)

.

.

.

Thursday, September 14, 1950

Over 250 In Attendance

Nat

Krumholz, Siegel & Co.; Ernie Lienhard, Troster, Currie & Summers; Fred
Vogell. Vogell & Co., Inc.; Harvey Renton, Jr., J. G. White & Company, Inc.;
Skip Clemence, Vogell & Co., Inc.

Gene

M.

Cohen, Gruntal

&

Co.;

Ed

Whiting, Carl M.

Loeb, Rhoades & Co.; Lester Gannon, Batkin & Co.

Sid

Charles King,

Charles King & Co.; Robert H. King, Charles King & Co.; George
Searight, Eisele & King, Libaire, Stout & Co.; Arthur Burian,
Daniel F. Rice & Company

Siegel, Siegel & Co.; Gerald F.X.Kane, Frank C.

Moore & Co.; John Dunn, E. F. Hutton & Company

Hans Ben, New York Hanseatic Corporation; Bob Herzog,
Herzog & Co., Inc.; Otto H. Steindecker,
New York Hanseatic Corporation

Bill Frankel, J. F. Reilly &

Co., Incorporated; Mel Wien, M. S. Wien & Co.; H. K.
Greenfield, Greenfield & Co., Inc.; Barney Nieman, Carl Marks & Co., Inc.;
Gene

Stafi-k, Merrill Lynch, Pierce, Fenner & Beane

Ben Van Keegan, Frank C. Masterson &

Jim Cunningham, R. H. Johnson & Co.;




Co.; Joe Eagan, Frank C. Masterson & Co.;

Frank Mulligan, Joseph McManus & Co.

Walter

F.

Saunders,

Dominion

Securities

Corporation;

John J.

Sullivan, Merrill

Lynch, Pierce, Fenner & Beane; Seth Fitchet, Merrill Lynch, Pierce, Fenner & Beane;
James McCluskey, Merrill Lynch, Pierce, Fenner & Beane; A1 Powell,
Alfred L. Powell Company

John

Graham, Brainard, Judd & Co., Hartford, Conn.; Henry Oetjen, McGinnis &
Company; Jim O'Donnell, McGinnis & Company; Graham Walker,
Joseph McManus & Co.

Volume 172

Number 4942

..

.

The Commercial and Financial Chronicle

Truman Outlines Controls




26

The Commercial and Financial Chronicle

(1010)

accounts

this

since July 1
permitted
beneficiaries.
were

designate

News About Banks

William
dent

NEW BRANCHES

REVISED
'

Bankers

and

ETC.

NEW OFFICERS,

N.

elected

been

of

the
City

the

of

Bank

York,

New

of

to

according

an

made Sept.

12

of

Mr. Gibson, who gradu¬

in

the

of

ated

National

Vice

in

his

as

in

College

he

1910, following which

Co.

of

President

the

to

Becoming
the

graduated
from
Hamilton
College in 1921 and the Harvard
was

of Business

Graduate School

1913

and

the

served

of

National Bank from
During the next ten

Liberty
1921.

1916 to

President

as

1921-1931, he was President

rector of the Great Northern Rail¬

of the

New York Trust Company.

1923.

a

Co. and G. D. Searle & Co.
serves

ton

a

as

College

Trustee of Hamil¬

and

Director

a

and

American Heart

the

Treasurer of

Association.

private wire
system
which will connect 188
banks in 54
important cities of
United

the

States

announced

was

Planned and spon¬
sored by a group of New York
and Chicago banks in cooperation
on

Sept.

with

12.

banks

American

abroad, in
Cross
activities,

here
Red

these

and

including

Finance

9f

nation-wide

new

capacities,

various

in

served

member of the

a

War

President's War Council and
Hi

A

Gibson

Mr.

throughout the

coun¬

try, the system will be known as
"The
Bank
Wire"
and
will be,

Commission,
for

sioner

France

Great

Britain

Europe, etc.

He had

Commissioner
and

Western

also

served

He

to

the

of

Endowment

been

had

Treasurer

as

Keller

Helen

Commis¬
and
Europe,

is

the

said,

will

was

both

beneficial

be

to

banks and their customers.

the

In

re¬

vealing .details on the new wire,
a
spokesman for the banks said
that the 54 cities

to be connected

have

aggregate
bank
exceeding $106 billion.

resources

Thfe sys*

equipment is obtainable.

The new

the system.

It is added

that the equipment to be

cations

provided
the most

communi¬

efficient

and

modern

is

Union

Western

equipment that has been
for such a
purpose.

developed
It

is

also

iasure

the

stated

that

in

confidential

communications

on

the

order

to

son

director

a

was

wire,

the

switching

entirely with Western Union em¬
ployees.
It is further indicated
regardless of the number of
banks in' the system, each will

that

recejve its ow/p messages without
messages

n*e

[yn'i

The

dgiio

of
i

*

numerous

National

Chase

New York has

vision

D.

Gibson,

prominent

not

pnly in ttie Ne.w|York banking
but1 \vhfo
also
achieved
international prominence in Red
Cross and other activities, died in
Boston on Sept. 11, after a brief

field",

illness.
years

Mr.

Branch of the

Gibson,

who

was

68

of age, was born at North




From
the
"Evening
Aug. 31, we quote as

Fidelity.
of

of

officers

"Active

the

East

institution
have
been
elected officers of Fidelity Union,
with the
exception of Frank C.
Orange

Ampere Bank Presi¬
dent, who has withdrawn and is
no
longer
associated
with
the
bank.
Ampere
Bank
personnel
have been taken into the pension
Ferguson,

of the Fidelity Union.
"Acquisition of the East Orange
bank
increases
Fidelity Union's
system

deposits about $8,000,000. Fidelity
Union now has 10 Newark offices,
three

East

in

Orange and

one

Chicago,

Na-

at

a

"Daily
the
Counsel,
will
bear
the
designation as Vice-President and
the

Chicago

according

to

Tribune."

Mr. Kearns, who is

bank's

Counsel.
bank

has

been

1939.

Mr.

Freeman

First

since

with

the

Bank, West Palm Beach, and Mr.
Setchel was formerly Vice-President
of
the
Florida
Bank
&
Trust Co., West Palm Beach. A
business office for the

temporary

Hollywood

Announcement

*

charter

for

the

of

made

is

will

bank

opened

be

Sept. 15 in the Slater Building,
Hollywood,
on

A
*

Holly-

the

Company; Mr.
Eltoon
was
formerly Vice-President
of the
Atlantic
National

1934.
*

of

Hotel

National

He

been

the

with

has

Manager

Beach

wood

the

*

First

»

.

issued

was

Aug.

22

Bank

National

of

Jefferson, at Jefferson, Tex., with

approval by the State Comptroller

a

of

succeed the Rogers National Bank

bank to be
opened in Hollywood, Fla., on or
Florida, of

about

Nov.

known

new

a

The

1.

will

bank

be

the Bank of Hollywood.

as

The officers of the corporation are
announced

Pentland,
Richard

President;

John
and

President

Wiljiam A. Setcnel,
of a

the

for

bank

made

was

Gay, Comp-

troller of the State of Florida

the Federa
Corp.; all deposits up to $o,000 will be insured
by the FDIC.
The capital and
surplus of the bank according to
the

by

appioved

Deposit

Insurance

the

Comptroller
*

of the

The

0akland

«

of£ice

Calif

o£

crocker First National Bank has
moved

to

quarters

temporary

Jules

the

Building

360

in

14th st

Oakland, opening there on Sept
The

n

to

move

is

temporary

th£

in
which contemwrecking o{ the bank>s
building at 13th & Frank>

quarters
bank's

first

the

step

program

,ates th
t

,in

Sts

e

0f

ected

^

to

a

buUding" incIudes

new

tbe

sde o£

the immediate con_
modern
building,
be completed in 1952.

and

>

s£rucyon

the

present Crocker Bank

to£ether

BuiIdi

approval

the

of

urovisions

of

^

On

July 3, word was received from
Washington that the bank had
been

Office

Currency,

the

Vice-

Elbon

A.

July 5, by C. M

on

of

President,
First Vice-

Notice of approval

Cashier.
charter

Chairman

Jr.,

Ben, Tcbm,
S.
Wright,

'.

of Jefferson, according to advices
in the Aug. 28 Bulletin of the

Robert

follows:

as

capital of $75,000. The bank will

with additional
.

a

A

.

be-

property immediately adjoining.

ing designated

as capital, $50,000
$30,000
undivided
profits. Mr. Tobin is owner of the
Hollywood Beach Hotel and the
Hollenden Hotel, Cleveland; Mr.
Wright
is
Vice-President
and

Plans for the new building pro-

surplus

p0se

charter

is

$400,000—$320,000

and

two-story

a

the

structure;

and

basement

will

bank

occupy

w

'

.

the main floor and basement of
the new structure.

.

in

Irvington."

Continued from first page
H:

*

sh

E. Rueth,
of the

The election of Henry.

stations.

Three

evening

spots

feature

Chase's

services.
being

are

Mather,

third

on

nings.

Two

of

We It
See

As

Chase

said

ident,
that

"new

vania

named

the
eve¬

commercials

film

on

taken

head

are

in

office

the

at

Vice-President

ment

of directors.

W.

New

Street,

Brokenshire,

sonality, is the
Jjl

New

York

ment

by

per¬

*

5}i

in

Greater

is

the

announce¬

Arthur

S.

Kleeman,

area

President of Colonial Trust Com¬

of New York, that all hold¬

pany

Division

Sales

Assistant

to

Secretary.

the

favorite

cause

one cent out of each ten
cents in revenue (10%) which the

Ind.,

the

(com¬

of

family allowances.
"Everybody living on
efits, or a fixed income of
same

Evans¬

to

the

current

Prior

announcement

stock

as

Sept. 5 Bulletin of the
the Comptroller of the
that

the

under

Office of
Currency

consolidation
the

charter

was

and

title of the "Old National Bank in

Evansville."
initial

It

capital

solidated

bank

into

divided

Government—and

"The

be hurt because

would

caught between

that

means

the cost of

all

of us—also

defense program

skyrocket."

So much for

dent.

they

Now
are

of the

some

turn

to

the

our

generalizations of the Presi¬
more specific (where

somewhat

specific) remedies or policies proposed.

is added

stock

that

the

of

the

con¬

will be $1

100,000

million,
shares
of

sacrifices which he says are
arm

be

First of

he thinks

we

with

profits and
less than $800,000.
*

W.

initial

reserves

*

Kearns

undi¬
of not

and

No

one

we are to re¬
would question the

of

such

What Sacrifice?

Any sacrifice
take

some

on

his part would,* therefore,-..have to
Possibly, he wowlcbiin tainyaevents

other form.

obliged to reduce his customary- plane'ofqlivmg'«some+1
as
a
result of lack of sufficient volume! oi; goods >T
available. In this case, he would in the normal course of !•
what

Gaylord

unavoidable if

a
position, but at the same time the
emphatically clear that he favors wage
increases to match any rise in the cost of living. In short,
the wage earner must be protected against any increase
in his ordinary living costs.

soundness

be
*

must.

President makes it

The initial surplus will

$1,200,000,

John

as

stock of the par value of

common

by

Mr. Kleeman, only the holders of

be

point determined that we shall all share equally in the

vided

group

would

the

the

worthy
specified by the depositor.

individuals

of

spiraling prices and lagging incomes.

The

$10 each.

any

pension, on retirement ben¬
kind would be hurt in the

any

way.

"Millions

J

to

a

fixed

of

capital

effective

$200,000),

bpnk realizes from the processing
9jf
checks drawn on personal
checking accounts, is donated by
bank

They would suffer far worse than our

more.

even

workers, because many of them are dependent on

opening of business Aug. 28.

effected

Colonial
unique
Plan.
Under the

be hurt

National

Old

Bank

urday's pay check would be taken away by the higher
prices for Monday's groceries.
"The wives and children of our fighting men would

all, let it be noted that the President is apparently at one

(common

states

their

Side

have the President once
His homespun way of putting the
matter may bring vital truth home to certain groups that
are very apt to oppose steps necessary to prevent inflation.
At any rate, here is the Chief Executive's account:
"Everybody would lose if we let inflation go un¬
checked. Workers would be hurt. The extra dollars in Sat¬
point them out.

more

of

ville

of personal
benefit

of

made

capital stock of $600,000) and

that

through
the
Raising

of the

Evansville,

North

in

checking accounts
banking institution may

is

Announcement

in

in¬
old

story, but it is perhaps as well to

would

*

consolidation

and, indeed, the inevitable effects of

flation, at least in their more superficial aspects, are an

Joseph

are

Cronin,
to
Assistant VicePresident, and Chester L. Cobb

ers

now

who

A.

mon

the

the late

died on
Other promotions in the

Aug. 15.

Bank

organizations and

causes

of the

18

Norman

radio

announcer.
JjS

Of interest to

charitable

York.

veteran

charge

He succeeds

Hyland,

*

Pine

in

according to an announce¬
made Sept. 12 by the board

bank,

Time

The

Pennsyl¬

The

of the Time Sales Division

Saturday evenings,
in October.
The spot
began
in
mid-Sep¬

for

of

for Banking and
Philadelphia, has been

of

The normal

*

Company

adver¬

and

sit

Reilley, formerly Assistant

Vice-President

John

on

and Assistant

Treasurer

*

John

WABD is

Bank's

advices in the
which
stated
offices, those of the
the

News,"

"Evening

Trusts

Friday

on

A fourth spot

recorded

ly occupied by Frank Shay, who
recently was named bank Pres¬

will

spots

Effects of Inflation

of Secretary and his new
position of Treasurer was former¬

fill them."

CBS-TV

means
higher prices, unless we do something about it.
Higher prices would lead to higher wages', which in turn
would lead to still higher prices. Then we would be started
on the deadly spiral of inflation."

post

Ogilvy,

the

and

evenings

CBS-TV

tember.

2.

stine, respectively, were named to

banking

Inc.,

WJZ-TV

Wednesday

on

1,

New

week

Hewitt,

by

agency.

on

it is learned from the
"Evening News" of Sept.
Mr. Zalenski formerly held the

Sept.

Newark

of

The spot campaign is

placed

&

retary, and Charles Zalenski to
Treasurer, was announced by the
directors
of
the
institution
on

one-minute

various

Co.

Trust

tele¬

a

over

each

President

Vice

Secretary, were created and Reed
P. Everett and Robert Van Ider-

Bank

inaugurated

campaign

spot

York

*

p^n,
Harvey

become the Ampere

that

expected

Assistant

•:=

ar¬

centers

of

corporations.

of

nature

rangements have been made with
Western
Union
to
operate and
maintain

the

Trust," and
said, it was
bank would

Bloom-

beginning
campaign

any

of

First

the

of Sec¬

scheduled

by

acquired by "interests close

Fidelity Union
eventually, it was

of

communications
on

been

field, N. J., to the office

system, it is announced, will pro¬
vide direct, fast and confidential
between

of

Community

Clearing House Committee

tising

it was explained, ibtrt
warranted,
expansion
and extension will take place as

control

that

indicated

was

the Ampere Bank & Trust Co. had

of the

54

cities,

by

Corbin, President of
the Fidelity Union, according to
the Newark "Evening News."
In
our
issue of July 30 (page 260)

Assistant

prison

wherever

made

was

K.

State of New York, and a member

tern will not be restricted to these

banks

Horace

announce¬

the Chamber of Commerce of the

largest

planned to expedite
transactions throughout
the country and thereby provide
new and improved services which
bankers,
banking

which

of

ment

of

of the New York Clearing House
Decorations
con¬
and most Association.
on
Mr. Gibson included:
modern communications system of ferred
its kind in the world. Engineered Legion Officer of the Legion of
arid
developed by the Western Honor (France), 1919; Command¬
Union Telegraph Company, "The er, Order of the Crown (Belgium),
Bank Wire" will open on Nov. 1
1919;
Medal for Merit
(USA),
with connections to 142 banks in 1945; Commander, Order of St.
John
and
Jerusalem
(British);
36 cities. The remaining 46 banks
in 18 cities will be cut into the Knight, Order of Vasa (Sweden),
1922; andr.Knight,. Order of the
system on Dec. 4.
Crown (Rumania), 1939. Mr. Gib¬
The
project, according to the

it

became the

Aug. 31,

on

Fund.

Vice-President

'•

Bank

elected—General

were

of

meeting of the bank's directors on
Sept. 8,
it was announced
by
Homer J.
Livingston, President,

Trust Co.

&

follows:

he became Vice-President
Liberty National
in

the

of

years,

and

ark, N. J.,

News"

Di¬

in

He is

Ad¬

Bank

Fidelity Union Trust Co. of New¬

in 1912,

He

of

Bank

Jr.,

Presidents

since

of East Orange, N. J.,

Liberty National Bank, New York,

Grant Keehn

release

from the United States Army.

way

Ampere

to

to

Assistant

1945

ministration

The

it

mond & Whitcomb

Colonel

a

Bowdoin

from
was

was, from 1910-1912, Vice-Presi¬
dent and General Manager of Ray¬

a

Presi¬

-

dent
OH

the

as

an

a

#

*

Freeman,

Vice

*

1906

associ¬

First

T.

Mr.

National

Lafayette
*

later Assistant Manager
in
the
Financial Department of
the American Express Co. from

be-

Bank

1902,

1902,

Mr.

with

company.

office boy for the
American Express Co. in Boston,

a

ated

trust

the

as

of

c a m e

the

elected

was

association.

the

New

of

Starting

lowing

Keehn

Percy

Brooklyn.

York, a position he had held since

meeting
board

Manufac¬

the

of

Company

Trust

turers

Board

President, fol-

directors.

At his death he

H.

President

was

besides holding the pres¬
idency he had also, from 1931 up
to
1947, been Chairman of the

Alexander
N a g I e,

C.

Conway, N.

1931;

announcement

by

Brooklyn,

director
Stapleton
is the Assistant Vice-President of

Vice-President

National

First

of

that

Stapleton

has

Keehn

Schwarting, Presi¬
Savings &

Liberty

announces

A.

tional

*

Association,

Y.,

of

Grant

V.

the

of

Loan

CAPITALIZATIONS

Executive

*

*

CONSOLIDATIONS

of
to

opened

year

Thursday, September 14, 1950

...

Volume 172

=.
•.

Number 4942

..

.

The Commercial and Financial Chronicle

accumulate

events

cash or other types of
liquid assets
savings bonds) to be used by him, so he hopes,
at some later date—and in all
probability give rise to de¬
layed inflation. Of course, it would doubtless be possible
to permit the
wage earner to force his rates of pay up,

(such

as

(1011)

Continued

Customers Brokers
Get New Slate

jrom

7

page

Shoe Production in

and then tax the increase away
dent has anything of the sort

Changing Times

from himf but if the Presi¬
in mind he has given no
indication of it. The plain implication of what he has said
is that he does not expect the
working man to share in the
general sacrifices which must be made—at least so far as
and price relationships v/ould result in such

wage
rifice.

The President has

all abnormal, for the same chains

July of last year reported de¬
creases varying from 8%
to 20%

prices.

his stand.

We have

the

a

make this

Nicholas

Novak

Alfred

Elsesser

President's idea about

an

profits tax

excess

almost childish—that is if he

really

means

to

seems

what he

us

rationing

The

the

Customers'

of

Brokers has announced

officers

and

slate of

a

members

the

of

Executive Committee to be voted
at

on

a

meeting to be held at
Miller's
Restaurant, 144 Fulton
Street, New York, Sept. 27.
The nominees

are

follows:

as

Nicholas

Novak,

tion, least of all inflation in the prices of
As everyone

higher

age

knows

an excess

and many

wages

goods.

consumer

profits tax tends to encour¬
other types of costs which

Treasurer:

threatened

are

take

of the

out

bulk

by inflation.
hands of

buy

consumer

goods which

What purchasing power they

dividend

recipients would not

large against the

excess

income of individuals. Obvi¬

ously, taxes to reduce

excess

demand for

must fall upon

suggestion has
A

be

those who buy

No such

more space

than is here available would

thinking

on

these subjects.

What has been said will

have to suffice for the present.

thinking realistically—so

It is enough to start

men

Steiner, Rouse & Co., members
New

York

Stock

that

nounce

Exchange, an¬
have signed a

they

five-year lease for
office

to

tomers

the

in

located

at

will

The

man

Dillon & Co.; William

well,

Fahnestock

the

ground

when the

Avenue,

Two-Year

new

floor,

off

in December
building now under
this

at

Howard

E.

said

address

facilities

at

Myers,

that
the

enable

is

increasing

managing

the additional
office

new

the

firm

located,

to

demands

service irnthue mid town
firmfsc toother viiptownr i

art) 157b East

and 1440) Broadway.

S.

associated

Thomas

Larch

with

A.

have

them

will

for

One

Year

-

4700

Members

86th

Street
<<




the

of

Committee

Frankford

who

Ladenburg,

Thalmann

Chairman;

Valverde,

the

list

Albert F. Frank,

Mrs.

&

Evelyn

Gruntal

&

Co.,

Brandt-

Co.,

Secre¬

Lynch,

Pierce,

Fenner

Merrill

&

Beane;

Paul Morton, Peter P. McDermott
&

Co.; A. E. Rhinehart, Eastman,

Dillon

&

Co.;

Anthony

Smith,

Co.; John Tilney,
&

Co.;

Joseph

Frankford

has

associated

with

Leydecker
OAKLAND,
Louvau

Calif.—Gordon

E.

has

been

added

to

the

Stephenson, Leydecker &

ATLANTA,

A.

as

&

Co.,

Inc.,

is

sales

City, an¬
that Edward J. Cunning¬

now

associated

representative.

old

line

which

with

them

agencies,

the

in

Crawford,

Street

Commerce

will

Fuel

partment.

De¬

handled

be

Interior, food by Agriculture
by the Federal Reserve

by

-»

The Commerce Department will

issue

priority
regulations,
and
probably put out some kind

will
of

inventory control order, but
as yet that

an

it is not at all certain

they

will

leathers

shoes.

spots,

of

Inc.,

The

principal

course,

goods.

'cdrfj
'

become

wages

the

are

chemicals, and

some

When and if controls
and

hides,

cover

even

or

struction

22

Building.

lll°a

necessary'^a

agencies.

in the old-time
The National Security

Resources

Board,

being set

in

un

which

1947

turn

into

the

event

now

was

es¬

planning
time
operating agency
as

a

expected at

It

one

vulnerable

If

the

suit.

to

a

government

orders the manufacturer to deliver
the

steel

the

manufacturer

to

the

contractor,

war

safe.

is

larly, the limitations of
priorities system
will

Simi¬

simple

a

quickly
if the going gets at all
rough. Take the case of leather,
for example.
There are so many
types and grades that as soon as
show

up

military requirements become at
all

heavy,

a control agency cannot
tanners make what they want

let
to

make

system

and

trust

to

channel

to

ends. What

priority

a

it

to

military

good would upholstery

leather be for army shoes? Copper
and

it

and

sugar

things
is

countless

to specify what

unnecessary

kind

of

copper

facturer

other

all fairly uniform and

are

or

sugar

him

that

drift into

we

is

1he

for

the

control agen¬
cies set up under the new law will

probably
force

the

War

will

agencies organiza¬

We

because

those

of

up

know

it

paralleling

central
It

who

by

essentially
today.

be

If

a

operating

have

the WPB did

because

a

easy

a

new

organization.

W.

Stuart

Symington,

appointed

about

two

Korean

War, will have a reason¬
ably active but not a controlling

role in planning the. control strat¬

to be used in the event);of

egy

real

war.

first

set

to

When

up

plan

from
Mr.

the

but

for

it

in

use

an

diverted

got

this after its first Chairman,

Arthur M.

Hill, resigned and

Mr. John Steelman

ing

a

agency was

in 1947 it started out

controls

emergency,

was

made act¬

Chairman

and continued to
serve until the appointment of Mr.
Symington. The fact that Presi¬
de^

Truman

after ithe

kept

Mr.

acting

as

Senate

Steelman

Chairman,

refused

to

con¬

firm former Senator Mon C. Wall-

to

the post,

that

Mr.

gency

controls

White

House.

indi¬

strongly

Truman

all

wants

policy decisions concerning

emer¬

in

the

Steelman

and

centered
Mr.

Mr.

Symington work closely to¬
gether and N.S.R.B. in all prob¬

the

responsibilities

plan for

an

as

real

very

in the last

seriousness

determining influence

of

over

well

as

all-out emergency.

to

Hold Annual Outing
The

Wall

Cashier's

Association

of

Street

hold

Inc., New York, will
its annual outing on Satur¬

day,

Sept.

Picnic

16,

1950, at Reinharts*

Grounds

Festivities

made

the problems to be dealt with will

as

into

months before the outbreak of the

noon,

develoos, it is likely
that time the little

will

WPB's
much

manner

fairly

likely that the N.S.R.B.,

Mr.
was

will

emergency

that

through

a

it

them

control

seems

under

in

make

assimilate

befoWr,

this

worked

conditions

ilar to

operating

necessity

which should

rearmament

Korean

being set

WPB.

be

of

con¬

planning for an
emergency.
This would
exceot for the fact that

are

the

emergency

Cashier's Association
of the

be divorced from

the old

grad¬
recognize

war

we

that its activities

all-out

administration

bad

all-out

an

ability will be used to arbitrate
disputes between the old Doe

an

operating agencies.

be

that he

all

ually, by the time

to

and

is

agencies which have been assigned

of

appears

needed

it

to the people
priorities. In any
event, the point that I think we
should not lose sight of is this: If

control

effort

tell

manu¬

a

All

make.

can

war.

an

war,

Exchange.

is

military emergency, and Derhaps
to
resolving
conflicts
between

the

Stock

war

a

voluntarily

damage

cates

under

Midwest

to

manufacturer

gren,

members

the

manufac¬

a

steel

instead of
delivering it to a private purchaser
who
had
contracted
for
it, the

consolidate the control machinery

CITY, Mo.—Wade P.
Owens is with Goffe & Carkner,
Inc., Board of Trade Building,
of

line

old

the

ask

you

deliver

to

contractor

agency will t)e
established which will absorb and

work

KANSAS

If

out.

in

voluntary
suffice.

already beginning to

are

brfces in^ripitlong

over

independent

new

tions

Marietta

&

industry is con¬
principally,
being

with

centered

through the
with those

shoe

the

inside

French

find
turer

to

will be administered

of

(Special to The Financial Chronicle)

70

serve
expe¬

indicates it

war

For the time being, all controls

Lynch has been added to the staff

Carkener, Inc.

Street, New York

nounce

ham

Saxton

ef¬

don't comply in jail.

subsidy on shoes would
purpose, but the

all-out

Dillard

With Goffe &

iWith G. A. Saxton Co.
G.

more

similar

The

Ga.—E.

people

as

will be confined to planning for a

the

firm.

rationing

and

This is far

in

(Special to The Financial Chronicle)

Exchange, an¬
that Thomas Wright Hare

become

A

trols

Stock

price

fective than the threat of putting

to

Stephenson,

Avenue.

Wertheim & Co., 120 Broadway,
New York City, members of the
nounce

both

tablished

(Special to The Financial Chronicle)

With Wertheim Co.

York

financial interest in compliance

with

agency, was

With

ever,

often

with the highest

now

Walker

When you

anyway,

will

A subsidy on meat at the packer
level, for example, gives packers

hot

Gjoesbeck,

do

to

necessary to
must deliver

metals,

Gerald

techniques used.

telling people to do what they

want

control alone.

Co.;

their

at

more

and credit

selected

are:

Scott

office

con¬

flexibility
than if reliance is placed on price

Nominating

of candidates

become

in

multiplicity of

a

permit

Board k

With French & Crawford

its

are

William

Term:

Specht, Hay, Fales & Co.

Co., 1404 Franklin Street.

The
-

Tilney,

Wood, Walker & Co.; Greg Law¬
Francis I. duPont & Co.

joined

their

will

cerned

John

staff of

Pine

ioff ices

Cogs¬

Joseph

rence,

handle

area.

Co.;

main office at 1420 Walnut Street,
and
Peter
N.
Svenningsen has

New

partner,

the

Karl

Term:

Exchange,

and will be

completed.

better

and

occupancy

construction

that

announces

&

Doctor, Laidlaw & Co.

cus¬

office,

new

Madison

575

the lobby and street,

ready for

firm's

rapidly expanding

area.

on

be

uptown

new

the

serve

57th Street

a

Stock

Many

open.

wasn't needed.

win & Co.

PHILADELPHIA, Pa. —Lewis
C. Dick Co., members Philadel¬
phia-Baltimore

trols

rience of the last

Alberti, Walston, Hoffman, Good¬

Lewis Dick Adds

Space Up Town

emergency

a

Executive Committee

Wood,

Steiner, Rouse Increases

Dunn,

are

thoughtful students of the prob¬
lem
feel, however, that in an

people who

Secretary: Marshall
Wood, Struthers & Co.

G. H. Walker &

hope.

we

circumstances, and what

on

regulations.

Ferguson, J.

necessary,

use

alternatives

tary; Joseph Cabbie, Abraham &

required to present all of the vital weaknesses of offi¬

cial

to

goods.

goods

been hinted at in Washington.

even

great deal

consumer

consumer

Walton

Lawrence & Co.

increase the flow of income into the hands of the
great
rank and file who, after all,

It all de¬

a

Four-Year Term: Milton Leeds,
Pershing & Co.: Harry Horn, East¬

dealing quite frankly with the public. But after all, an
profits tax is hardly one with which to fight infla¬

in

little

is

Nominating Committee of pends

Association

tion of the words "excess

excess

might be

but
trying to

there

Dunn

Vice-President: Alfred Elsesser,

to be

get

we

war,

prejudge this question.

Marshall

Kidder, Peabody & Co.

seem

if

come,

undoubtedly.
anticipates this.
Ra¬

Everyone

tioning

time

any

Bring Controls

will

real

a

at

future.

near

Will

War

into

shoes

of

/Controls

profits made since the
start of the Communist
aggression in Korea." If he is
suggesting that he wants to recapture profits in excess
of those being made late in June of this
year, it is hardly
likely that the tax will yield a great deal of income. If he
is prepared to come forward with some other
interpreta¬
profits" he does not

in Washington last week.

was

within the

Drysdale & Co.

excess

most

it al¬

as

shoes, and I
have not found a single one who
expects either price control or

President:

"recapture

is stepped up,
certainly will be.

at all concerned with

seems

Excess Profits and Inflation

the event
military

the

officials, both military and
civilian, that I know of who are

to say.

He wants to

in

of

tempo

ment

"pay-as-we-go" program? It is probable that
the Chief Executive has not
fully developed his thinking
on this
subject. It may be that his advisers have not as

of those by whom he is surrounded are ready to do
what is necessary in the form of taxation to take inflation
out of a $30 billion a
year rearmament program.
The

industry

the

I

a

any

shoe

1 have talked with all the govern¬

the President's ideas about taxation to

yet made their full reports on the matter. It must be ad¬
mitted, however, from any and all information avail¬
able, there is slight cause to hope that the President or

likely to be in store for

program

feverishly demanding
—and getting—increases in
pay much greater than the
rise in the cost of living, and this on
top of all the costly
"fringe benefits" (to say nothing of money increases) they
were able to
wring from employers last year when the
cost of living was
declining. The President is evidently
much more concerned about what
higher prices do to
wage earners and to wages than he is in what higher
wages do to prices.
are

agencies

that

about the unions which have been

And what

They have their limitations, how¬

what is

good deal of sympathy for
might at least have had as much to say

Yet he

techniques

Turning from the current situ¬
ation, let us look ahead and see

a

are

compared with July, 1948.

sac¬

the

in

good deal to say about the scare
buying of July, and about those who took advantage of
it to raise

27

in

Staten

and reserVati6hs^'nr|(yJ
through
Fred
R'^itdr,'

Dominick &*Dominick.
ur-.uK.;
.(I

Dan sker Birds/
David

pointed
the

F.

Tracy

he
oif

r>ru:I."

-

Appoints '
has

been

ap¬

general sales manager of

retail

Dansker

Fifth

Island.

wil)t cpmmence df 12

sales

department

of

Brothers & Co., Inc., 511

Avenue, New York City.

28

The Commercial arid Financial Chronicle

(1012)

Continued

from first




page

..

.

Thursday, September 14, 1950

Volume 172

Number 4942

..

.

ditional productivity can you hope
for

from

of

railway

increases

workers?
service

ing

can

the

much

of

postal

workers

additional

increas¬

you get from

wages

to the least desirable, least em¬
ployable, least efficient, marginal

and

express

How

wages

the

in

The Commercial and Financial Chronicle

elevator

oper¬

The

who

minimum

lishes
the

the

that

from

matter,

how

productivity

general
of

much

can

increases

retail

increase
get from

you

in

the

salespeople?

salaries

There

are,

of

course, differences in efficiency
in all such lines of
work, but gen¬
eral increases

covering all of these

occupations can secure for you no
increases in productivity whatso¬
Such

ever.

increases

wage

must

be considered

as pure increases in
the costs of production which must

eventually
be
covered
prices of the goods and
to the

by

the

services

consuming public.

The

relation of wage

unaccompanied

by

increases,

increases

productivity, to inflation

are

in

very

clear. Wages and salaries make
up
from 75% to 90% of the total costs
of production in this
country.

general

increases

salaries,

unless

proportionate
hour
in

in

one

and

accompanied

increases

productivity,

only

Any

wages

can

man-

be covered
that

and

way

in

by

is

higher prices. Higher prices

by

mean

inflation.

more

the

minimum

of

the

un¬

are

directly
rate

wage

value

forecasting that there
only moderate inflation.
moderate inflation? Was

a

the 40 % decline in the dollar from

of

the

in

the

decline

dollar

moderate

similar
few

the

1939

from

inflation?

decline

be

years

tion?

in

value

to

1950

Will

there

are

There

em¬

during

a

another

the

moderate

a

are

minimum

laws.

wage

minimum wage regula¬
tions ib effect in 24 States and the
District of Columbia. In addition

next
infla¬

Does the

to these
mum

laws, there

regulations under the

wage

Federal

also mini¬

are

Wage and Hour Law

of

lar

to feel any better when the
value of the dollar is dissipated?

Whether the inflation is moder¬
ate

of

abrupt, what is to become

or

all

the

insurance, pension and
community funds and the gigantic
social

security system

been

established

in

that

have

1938, amended in 1949; and under
country?
Can these funds be increased as
Walsh-Healey Act of 1936.
fast as the inflation progresses?
The Federal
Wage and Hour
Law of 1938 started with a mini¬ Congress passed a law a few days
for

wage

interstate

tries of 25 cents per

raised

by

this law

steps

by 1945.

amended

was

the

crease

hour, that

successive

40 cents per hour

indus¬

so

minimum

was

up

to

In 1949
to in¬

as

to

wage

75

The

Walsh-Healey Act of 1936
gives the Secretary of Labor the
in

fix

to

all

the

plants,

cial

security

insurance

sounds

fine

expensive
realize

minimum wage

or

having

concerns

with

the

or more.

hand

one

and

the other, but do

on

that

That

this

with

even

purchasing

we

77%

of

power

the payments of these people who

living

are

them is less than it

on

the

at

was

lower

back

rate

in

1939?
The

government

amounting to $10,000

the

on

so¬

payments

to people who have retired.

increase the

cents per hour.

power

granting 77% increases in

ago

internal

outlook

The' country is faced by

accompanied by increases in pro¬

present

lem

ductivity

some

in

this

major prob¬

a

serious

the

as

precisely

are

effects would

the

same

from the

be

issue by the government of
cured

printing

press

unse¬

The

money.

effects may not be so
speedy. The
inflation from unearned, wage in¬

Secretary of Labor has set
minimum wage rates as high

$1.23 per hour in the steel in¬

as

creases
as

comes

but the principle is the

to

doing anything for labor

taken place since 1939, which have
run
far ahead of man-hour pro¬

in

were

1939.

of

today

much

are

that if wage

us

s minimum
wage orders will
be very extensive.

The

States

considerable
mum

ity

per

the

value
to

It

more.

of

is

the

dollar

simple

as

will

more

and

down

go

that.

as

If

these processes are continued
they
will end in the total destruction of

dollar

It

be

questioned

whether

the effects of wage increases made
within a single company or even
within

a

single industry have such

general effects
gested
that

here.

a

rates.

was

The

order

an

in

mini¬

most

re¬

fixing 75 cents

have

as

It

been sug¬

may be granted
increase
running

wage

hour for the mercantile

occu¬

the

automobile

fects

of

such

like

much

in

long

granted

industry

heaving

pond.

a

all

ef¬
be

brick

a

The

directions

into

waves

for

and

The;, swdge

distances.

in

the
must

increases

the middle of

spread

is

' rates

dustries,
Even

all

heavy goods in¬
well,
and. beyond.

as

the

trades

retail

will

have

to meet these wage

ticularly

the

in

increases, par¬
communities in

which these industries
within
you

few

a

pass

Will

such

on

costs of

What

will

be

you

increases

able
in

the

a

your

roll-back in prices

24-June

May

24

levels

if

President decides to institute
controls
But

to

operation in higher prices
public?
Don't forget tne

possibility of
to

montns.

get in return for these wage

increases?

to

located,

are

this

the

granted

fall

price

winter.

or

wage

the

All of the State minimum wage
are
under
constant

pressure not
but

also

individual

by

mum

only from the unions,
the U. S. Depart¬

from

75

rates

wage

to

up

all

mum

for

munities
have

in

which

they

occur,

minor effects compared
with increases1 in ^minimum wage
but

rates fixed
wage

by law.

cents
the




and

minimum

cents

as

a

margi¬

80

to

not object to fair and

us

distributed

rates that

increases

will

ernment to pay

help this

its

in

of weakening

means

our

We know that much of what

was

spent

inflationary trend in our
land can be stopped, but only by
heroic efforts to patriotic people
who

will

step

oppose

towards

possible

every

further

waste,
Its

but

debts

But

is

it

are

will

ment

up

who

will

rig

of

twice

as

much

marginal worker became
$1.50

hour

an

and

our

the

entitled

get

it

already had it. Many
wage increases during re¬

the

cent

months

stem

come,

of

ment

of

75

and

others

from

the

cents

the

minimum

yet

to

establish¬

There
be

has

The

increase
from

the

75

there

must

never

need

we

anced

Federal

achieved
debts

as

of

by

to

prices

creases

t All

but

and

Part

forget that
is

for

to

$1

rate

wage

an

hour.

about

Is

what

Are these recent

in

accompanied

productivity,

The

answer

is

responsibility
for
this
program
is individual.
What will occur will depend upon
what
us

I do about it.

and

you

increase in cost of

oppose

and

of

power

that

Those

who

prices,

or

less

higher

they

offer

titled

to

with

forming the
partnership of

as

the' government

higher

to

the

costs

of

not

acceptance of

easy

or

en¬

their

demands.

I

consumers

will adopt a similar at¬

titude

convinced

am

towards

inevitably, later

when

these ^wage

becorne effecting?

r)^

(2)

as

A

that

honest, not

well

consumer

offices at 32

Broadway, N.
Y. City, to act

by all others.

dealers

Federal,

State

and

ments do about it.

ernment does

pends

upon

others

as

in

local

at least until man-hour

merly

ity has caught
and

ments

tion

begin

But what gov¬

this country

what

and

you

I

citizens want done.

foundation
sound

of

sound

de¬
and
The

government

policies begin with its

Let

us

insist

that

the

produc¬

and

prices
again go down to normal levels.
(6) The people of this country
need to return to their original
faith in the dignity and respon¬
sibility of every individual for
carrying his own load, for pro¬

Reilly & Co., Inc.

with

Formed in

as much
as
he can, and
for keeping at it as long as he can.
There is much work to be done.

Short
hours, frequent holidays,
strikes, early retirement and other
forms of loafing have never added
anything to the economic struc¬
this country, nor do they
anything to the self respect

and

enjoyment of life of the in¬

dividual.

should

Our national

be

to

philosophy

secure

greater pro¬
duction, fair wages and prices re¬

determine

issues

clearly what the
this country are, what

of

candidates

for

office

be de¬

may

that the members of

see

ilies who
do

employees

time off to vote, we must urge our
friends and acquaintances to vote.

believe

has

have

in

lost

great deal

a

Kravitz

Street

our

failed

present

economy

vote.

Elections

to

don't vote

evil

that will

This is not

simply

action.

measures

weaken

tually destroy
It is

must accept in¬

we

flation and other

even¬

our economy.

talk of pessimism.
call to much needed

a

a

We have lost ground.

lose

more.

But

gets going it
first

about it.

It

make

We

when

can

ground it has lost.
must

equally

and

busi¬

recover

the

in

bor,

even

them

the

was

The mathematical prob¬

for

on

formerly Manager of the Util¬

ities Department of John C. Kahn

Company
with

L.

selves and for
believe

that

our

for

to

take

and

this

more

don't

military defenses, but this
in-i is1 no time for expanding
expen¬
sriT sive governmental activities such

trend

that

swinging their
at

the

of

it.

are

the

more

our

at

going to get

its

who

I

are

and hatchets

axes

It is the solid

country,

towards

those

integrity of
system

was

Co.

and

&

Inc.

Open in East
MOUNTAIN

LAKES, N. J.-J.

Alfred Francoeur is

engaging in

a

securities business from offices at
49 Briarcliff Road.

Mr. Francoeur

for many years was active
investment

He

business

recently

was

in

in the

Chicago.

with

David

A.

Noyes & Co. and Brailsford & Co.,
and in the past was head of J. A.
Francoeur & Co.

Chicago Bond Club;
Field

Day Held

CHICAGO,
111. — The
Annual.
Field Day of the Municipal Bond
Club of Chicago was held at the
Knollwood Country Club on Sep¬
tember

8.

Committee

Chairmen

Francis R. Schanck,

Jr., Ba¬
Whipple & Co.; Walter C„
Cleave, Blyth & Co., Inc.; Warren
were

con,

S.

Yates, C. F. Childs & Co.; O. H.
Heighway, Hornblower & Weeks;
William S. Morrison, Jr., Harris
Trust & Savings Bank; Thomas L.

Trust Co.

Hamp Jones Co. and
O.

B.

Walton

Formed in

& Co.

Jackson, Miss.

families. I don't

majority

inflation lying down.

think

thereto

Sherman

J. A. Francoeur to

our¬

citizens of this country are going

time

must build

the

prior

and
D.

Mackenzie & Co.,

the side of what is

country,

our

a

ris, Inc.; Walter A. Hintz, McDougal & Condon, Inc.; George J.
Bielby, F. S. Moseley & Co.; James
S. Barcus, Barcus, Kindred & Co.;
and Ross A. Gustafson, Northern

organized labor, who are
same
thing.
Many of

are

in

Kravitz.

Robertson, Sills, Fairman & Har¬

are

fight.

engage

Mr.

minds

trends to take off their coats and
to

to

business.

that there

our

find

mad enough about pres¬
conditions and their current

ent

Albert
Albert

Kevin, Glore, Forgan & Co.; Paul
Hackbert, Shields & Co.; C. J.

win.

other millions of people, both
business and the ranks of la¬

are

—

formed

We

can

up

will

We

has

Northwest

securities

of

usually bring out less than half of
the eligible voting population.
If

It is inevitable that
up our

eligible to vote will

are

We must give our

so.

fam¬

our

Washington

WASHINGTON, D. C.
V.

tivity

to

F.

Kravitz Co. with offices at 1319 F

lated to normal values of produc¬

is

J.

Albert Kravitz Go.

ducing

economic

we

for¬

Mr. Krulisch

Richard C. Robert.

government cut its spending for
civilian purposes to the bone.

all

secu¬

was

with
Stuyvesant F.
Morris & Co.,

wage pay¬

of

costs

decline

to

erts

productiv¬

with

up

until

counter

our

govern¬

in

rities. Mr. Rob¬

right
po¬

brokers and

as

such regulation should be opposed
both at Federal and State levels,

abilities

(3) Part of this program is
litical. It depends upon what

citizens.

on,

as

tightening of

wild

prevent

Roberts

Co., with

over-the-

doing

prices.

your

reasonable

to

and

pro¬

&

fundamentally major cause of
inflation. Any further extension of

ness

values

C.

R.

there¬

but

may

un¬

Robert

and

R. Krulisch are

us wake up to the dan¬
of minimum wage regulation
by law. It is an insidious

fixed

com¬

rates,

wage

Roberts

(5) Let
gers

higher

can

we

ask for

greater productivity, are

in

question about what

C.

inflated, dollars.

Let
mer¬

operation

mand.

or

no.

Richard

our

bal¬

a

budget
to
be
possible. The

soon

after should be paid in

we

the

of

spending should be supported by
people within the credit business

economists, sibelieve,' agree
are facing more
inflation,
some
sugar-coat their state¬
we

(1)

will

promises of increases

happen

your

there

increases

there any

merit

and

productivity?
Is

will

trust,

been

question

increases

o

I

credit

tion of workers?

by

which,

favorable consideration.

rate

adopted, to current
wage rates for employees who are
up above the marginal classifica¬
rate

a

prepared

Jan.

this will do, if

wage

suggest

like to
program for which I am
to make my stand and
would

last

minimum

Own Investment Firm

deficits.

ground by the fact that those who

wage

cents

any

conclusion, I

a

in this worth¬

govern¬

more

into

fundamental

Business

hour

strong effort in Congress to

a

political

per

1950.

25,

to

Conclusion

every

75

he hasn't

of

by

economy

ana

effort

every

for further inflation.

means

chandise

as

will

productivity,

oppose

as¬

in

Richard Roberts Forms

government.

our

ours.

run

debt

our

inflation, pended upon to carry out sound
creating political policies, and then vote
permitting for them. We must vote. We must

money
by
production to rise faster

way,

if

even

while movement.

(7) We also have a responsibil¬
ity as citizens. That responsibility

country.

our

The

you,

was

build

to

enemies of

to

went

humble

very

proud to be

am

gov¬

it goes.

way as

I

with

all.

When

got it.

wage

an

hour, the employee who

worth

was

mini¬

entitled

was

hour

an

cents an

The minimum! that

rate is the lowest rate paid

tax

anything for nothing, who

will stop it.

and a higher standard of
living, not for just a few, but for

In

employee

an

much

as

worker

the

40

was

example,

worth twice
nal

When

rate

wage

industries

com¬

rates.

wage

duction

the

widely

worth

sociated

providing aid and comfort to the

«?■.

A minimum wage fixed
by law
and applicable all over a State or

will

within

civilian

or

economy and in a very true sense

least

at

cents.

industries,
while highly stimulating to allied
and

Let

add

ment of Labor to raise their mini¬

even

rate 5 increases

sure

defense

ture of

and
made to it,

rates

will

in

we

in

of

to

also

are

(4)

"concession

than

if

but

the

in

industries.

a^dangerous thing
increases

as

costs

granted by General Motors, Chrys¬
ler's, Ford and their subsidiaries,

shortly become the standard
wage rates that must be paid not
only throughout the auto industry,

is

that every

OPA fame.

hour,

hour

flation

from Governor Chester Bowles of

30

per

now

somehow learn that this in¬

fictitious

the entire country is a tremen¬
dously effective means of raising

cents

a

either

who will themselves stop

beyond man-hour productivity in
small concern may have rela¬
tively little effect, but when a
wage increase of from 5 cents to
a

must

pations in the State of Connecti¬
cut, presumably under pressure

authorities

sign.

may

variations

wage

cent

everything in this country bearing
the

that have minimum

regulations have established

wage

rates continue to go up faster than
increases in man-hour productiv¬

continue

is

just doesn't believe in doing
wages and
anything by halves.
In a period salaries, unaccompanied by simi¬
lar increases in man-hour produc¬
as
this, when thousands of
concerns will be
working on gov¬ tivity, and minimum wage fixing
ernment orders, the influence of at artificially high levels by law,

they

as

This should also be

sufficient to show

It

such

ductivity, you have a clear, sim¬
ple, understandable explanation of Tobin
why your dollars
only worth half as

inflation.

problem.
It is fully as
dangerous to our future as any

such

he

same.

In the wage increases that have

further

dustry; $1.08 in the vitreous china external enemies that we
If we are to escape
industry; $1.05 per hour in the have.
auto industry, and so on.
of our
economy,
Secre¬ wreckage
tary Tobin has amply shown both
by words and deeds that when it

may, perhaps, be described
creeping rather than run-away,

of

ice

this

the

mum

employees who ought to get out
and go into some useful serv¬

now

of

sugar-coating help
you or any other American having
ployee to his employer.
There
are
26
States
and
the fixed incomes or possessing any¬
District
of
Columbia
in
which thing bearing the sign of the dol¬

contracts

The effect of wage increases

less

or

by

be

base, of the 50%

or

All other wage rates

measured

terms

estab¬

structure for the entire

country.

in

rate

wage

foundation,

wage

ators, taxi drivers, street car oper¬
ators, policemen, or firemen? For

ments
will

employed. What is

be

can

(1013)

American

the

JACKSON, Miss.—O. B. Walton
and

Jones

announce

the

by mutual consent of
Walton-Hamp Jones Company on
Sept. 1 and the formation of Hamp
Company, with offices in
Deposit Guaranty Building,
and O. B. Walton and Company,
with offices in the Tower Bldg.
Jones
the

present

away

Jere A. Sexton

with
Jere

citizenry of this

business

Hamp

dissolution

people,

its

in

A.

Sexton

Sexton, senior partner
&
Smith, New Yor|c

City, and a member of the New
tradesmen/its professional people
as ' valley
York Curb Exchange since 1923,
authorities, socialized
medicine, or making work for and its workers who know that died at his home at the age of 59
many
thousands of government they can't get something that is after a long illness.

30

The Commercial and Financial

(1014)

Continued,

jrorn

these relationships and give them
consideration
in
measuring

6

page

full

in¬

the trend and outlook for the

Factois Influencing Government
Bond Market

view

In

securities, and the deposits of the

ket

market

short-term

first

this

banking

the

assets

have

system

creased

of

step,

in¬

been

by $1 million in

form

tne

government deposits.
At

it

present

the bank to
the

carry

Federal

If

for

necessary

with

reserve

a

Reserve

approximately
posits.

is

System

prices

higher

point
lower

and

yields in this section of the

mar¬

result.
This makes it
clear that the Treasury has a con¬
siderable degree of control over
the behavior of the government
market through varying the types
may

and

which

securities

of

amount

offered.

are

Thus, the outlook for the budget
is

given

always

deal

great

a

large

eral

hand

on

Reserve

the

Bank

borrow

and

them to supply the 20%
reserves
required against the $1
million increase in deposits. Or it

sell

may

Federal

the

securities

Reserve

the

to

System

through

the open market

(we will

that the

Reserve

Federal

assume

System
is ready and willing to purchase
securities in order to facilitate the

borrowing operations of the
Treasury), crediting the proceeds
to its

account in

reserve

T.'eral Reserye Bank.
it has been
to

the Fed-

Thus

find

we

possible for the bank

purchase

securities

from

the

ties will have to be sold to finance

whether these

to

as

bank

whether they
the

are

investment,

or

will be designed for

classes

other

im¬

investors.

of

has

Treasury

Thus,
that it

stated

under present conditions
expansion and active

wishes,

credit

of

business,
deficit

to

of

finance the current
$3-$5 billion a

about

by offering securities as far
possible to others than com¬

year,
as

in

deposits
is

that

not

sion

in

which

occurs.

significant

only
the

is

to

an

see

supply
inflationary

money

supply

money

funds accumulating in their hands

The

in

our

economy

readily

amounts of securities may

From the

government

to

mercial banks.

It

this

was

be sold

the

com¬

'

which

process

brought about the tremendous
pansion

of

deposits

securities

ment

and

ex¬

govern¬

outstanding dur¬

when

effect of the

30,

be understood
considers the

can
one

financing of the

middle of 1941

1945,

the

idebt
banks

this

and

through

in

tude

banking,

Federal

t

Reserve

bring

may

expansion

an

of

and

currency

credit

our

will

areas

magni¬

monetary,
Changes in

price structure.

several

the

development

caused alterations of great

significance of this

Banks

great

debt

financed

was

eral

so

June

Federal

gross

and

Reserve

war.

to

increased from $49 billion to $259
billion.
An important part of this

ing the war.
The only limit to
this procedure is that the amount
of securities absorbed by the Fed¬
about

the

of

Federal budget to all elements in

about, but also this process is a
self-perpetuating one, so that huge
by the

Investment Accounts

Treasury

influence

Another

illustrate

the

development.

Even this

limit could be removed by the en¬
actment of legislation by Congress
-

changing the gold requirement to
a lower
figure, as was done at the
time of the currency crisis in the
1930s.
„

This

expansion

supply which

of

occurs

the

money

banking system

the

time

comes

when

the

'

Treasury is able to reduce its debt
outstanding.
The deposits of the
Treasury
are
soon
spent
and
transferred to the credit of private
so that the increase in
the money supply is a

depositors,

semi-per¬

manent

is

able

until

one

to

the government

operate with

surplus

a

and have funds available for debt
reduction. The postwar record has

not been

reassuring in this respect.
Surpluses have been shown in

only two years, and Congress was
quick to put through a cut in
taxes

when

surplus

it

appeared

might be

shown.

tunately, such factors
erned

by

political

down

or

banks

reduce

short-term

to

hold

prices

in

of

which

Of

course

and

ment

accounts.

trust

securities.

ernment

should

policy of main¬
taining
relatively
low
interest
rates has been of great importance
to the economy and to the invest¬
ment
market.
This
policy was
the beginning of the
war
period, and has been con¬
tinued, with slight modifications,
adopted

at

through
well.

Thus

i-iaffect

are

the

2M>% rate

a

absence of

issues

a

may

tal

a

highest

stimulate




There

obligation.

grade

securities constituted

60% of

over

their total assets. The government

holdings

savings banks
nearly $6 billion.

of

in¬

These

great

changes

re¬

flections of an expansion in the
monetary structure of the. country
which worked its way into
every
nook and corner of our economy,
is

as

illustrated by

the increased

securities

government

of

insur¬

companies and savings banks

ance

referred

to

above.

These

insti¬

tutions

are holders of the liquid
savings which people accumulated
out of the expanded wage and sal¬

ary

payments during the

riod.

this

With

war pe¬

great

is

highly unlikely

much in

on

the

very

of

little

not

surprising that
prices of a

over

has

100%

occurred

since 1939.

Thus

we

see

that

Treasury

a

deficit which is financed
the

banks

exerts

through

influence

an

throughout the economy/ Although
the war period represented an ex¬
aggeration of this influence to an
extreme

degree,

it

serves

as

be

see
a

postwar

expected

to

during the

the

same

pressures

be

as

war

-

great

as

period,

we
influence at work to

lesser degree under present con¬
It is for this reason that

ditions.

the it is important that we understand

As

al¬

rate.

above

and

by the Federal

simple

Federal

Reserve

curities

the

to

the

reduced

rectly

by

This

in

buy

Federal

of

explains

the

Reserve

the

buying

does

affording

which

3%

to

yields
may

payment by the

for

time.

With

through the

by

the

which

offered, but
is provided
corresponding amount of

banking

with

a

free

If

funds.

continued

large

are

to

the

supply

procedure

lates that the banks

riod

over

to maintain government credit on

basis

these

that

no

Regardless

payment.

major price de¬

a

marketable

would

investors

to present their

urge

of the fact that

government

have

important,
perhaps
dangerous
effects
the institutions which hold

these

securities

in

such

large

amounts, it is clear that this huge
of

constitutes

what

de¬

obligations against the
Treasury makes it unlikely that
the Treasury .would want to see
prices for government securities
go down;and yields to rise to a
degree
which
might
influence
holders of savings bonds to cash
in their securities.

tral,

very

important factor

policy of the Federal Re¬
System.
It is necessary to

or

either

whether

credit

expansion.
striction
the

speculative activity.
while
lacking
in

of

sure

less accurately

will

needed

stabilize' the

to

These

with

which

System

able

is

bond

ment

riods

pe¬

pointed

the

of

out

bonds of

for

rates

many

op¬

With

these

the authorities
portunities
to
exert

in¬
has

showing only slight
fluctuations yields of high-grade
corporates
and
municipalities

interest

ment

fluences, and the technique
been developed far beyond any¬

reflected

govern¬

issues

are

this

circumstance

is very

changes

The

sensitive to these

influenced

is

and

of

sensitiveness

which
the

made

has

Federal

exercise-

control

of

have

a

to

Set

thorities

are

i&derstood

in

the

that

ing

policy is

it

is

restriction

neu¬

aimed
or

at

credit

A policy of credit re¬

would

Federal

be adopted when,
Reserve System be¬

lieves that business is at

so

high

a

those

securities,

ment

au¬

scale

the

to

be

from

thelpart of the Sys¬
l^rs been referred
officials of She Federal Re¬
on

threatened

were

large response
t%relatively small

a

develop¬

This
on

time

that

at

large

such

a

that

orderly

markets for government

relatively

market

investments.
took place

open

and

it

securities
was

nec¬

for the Federal Reserve to

essary

billions of longbonds in sup¬
porting the prices of government

purchase
•term

This fact

to

than

attractive

government

taking action is Sufficient to bring
the

corporate se¬
(due to financ¬

of

available

securities into other hieher yield¬

The

tem.

supply

large

situation

market.

operations

securities.

1948, when insurance

purchase and sale of

securimfes

a

of

move¬
ment occurred out of government

ernment

in

1947 and

more >

relatively small iamounts of gov¬

about

and

ing operations to secure the funds
for business-expansion), at yie'ds

for

degree of

the jcredit

over

tnrough the

business,

of

expenditures by business,
strong influence upon the

a

curities

market

System

considerable

a

Business

and

companies,
savings
banks
and
other institutional investors found

It is

possible

Bonds

market for government
In

quickly
change in

the

it

Reserve

small

1

trend

capital

by

trend are taken into account.

this

relatively

shown

Capital Expenditures

occur

anticipated, the government

market

have

and

To the extent that

fluctuations in interest rates
or

that

market

orderly and relatively stable mar¬
ket
for
government
securities.

and postwar periods have

war

stability

corporate

term.

longer

be

for
all types has
been
greatly influenced by the
operations of the monetary au¬
thorities
designed
to
keep
an

Reserve

short

for

the

should

It

the

influence the
the govern¬

market

over

or

to
and

tude.

weapon

Federal

the

market

money

market.

powerful

a

computed and are

generally of considerable magni¬

operations

open-market

represent

by
System as greatly facilitat¬
ing the credit operations of the
Open Market Committee.

many

government

securities at

above par.

or

serve

step

crease

the

continuing
favorable
resuUing

titative

A

Federal Reserve Policy

Another

its

and

qualitative efficiency, their quan¬
effects may be more or

likely to
the pres¬
to
put the funds to work
provide the buying power
are

The

•

is

steady

a

balance

wish to invest them, and

a

very

a

are

Nevertheless,

accumu¬

how

upon

as

and

inflow of gold or a protracted pe¬

a

funds

of

such

trade

is

such

extent

any

basic

some

trend

system

of interest rates and

in

market and

open

act

slight indications

investors,

not

are

in

generally invoked only to counter¬

bonds

hands of individuals, it is not sur¬
prising that the Treasury desires

and

weapons

selective

the

large proportion of which is in the

securities

avoid¬
deficiency penal¬

the System take out of the market

It is interesting to observe
closely the psychology of the
market is geared to the outlook

of

in¬

applica¬
tion for the delicate day-to-day
functioning of money control

them.

cline

which

difficulty of

or

ease

These

sufficiently

Government

any

for

flexibility of

rate

reserve

tive to them.

in

at

bonds

the

have

2.50%

a

of

ties.

ef¬

policies of the

System when the

only

Not

for

member bank borrowing or

government market requires sup¬
port.

devices

the

rediscount

fluences

positions of the

and

reserves

the

ance

situation

powerful

of the money supply, the
authority to change the percent¬
age of deposits required to be held

amount

banks.

fectiveness

other

control

for the securities.
when
the
Federal

add to the reserve

with

bonds.

two

di¬

securities in
market the funds paid

open

attractive

are

The Reserve System has at hand

pay

Banks

member

the

corporates

ment

banks
are

as institutions
faced
with
the

whether purchases

to

as

little additional yield available
above that of long-term govern¬

se¬

latter

uncertainty in the

are

so

the

commercial

of

reserves

If
sell

Banks

any

years.

market,

others

question

Reserve is

direct.

and

gov¬

at

during the last three

of

both

long-term
less than

now

fluctuations.

great amount of securi¬

will feel

from

is

thing employed in earlier periods.

hands

such

that

corporate

The effect of open market oper¬

ations

has

longgovernments, however, so
that the additional yield available
from high-grade corporate issues

result of this

a

se¬

bonds

been much less than that in

how

a

cannot

1%'%

one-year

effect

some

coiporate

term

Also, the market has become well
acquainted with the effectiveness
of these operations, and is sensi¬

a

mand

is

wholesale

basis

of

corporate

contributing to this de¬

turned

holder

high-grade

advance

to

1V8%

price

long period

outstanding

from

be

rate

a

the part of the Treasury is

sire
ties

that

of this figure was

excess

cpme.
A factor

volume

it
in

rate

given

nation,
rise

a

preponder¬

The decline in prices of

their short-term bonds.

nating

statements ema¬
Washington which

.from

of

concurrence

the

This makes for

The

expansion
in the monetary structure of our
a

corporate market and

corporate

development, rates are slightly
higher on short-term corporate
obligations, and municipalities are
obliged to give higher yields on

$57 billion Savings bonds alone in

were

the

ernments

the

creased by

with

time

have been many

those

even

long-

on

governments has become al¬
by-word as the fundamen¬
long-term yield rate for the

most

offered.it tends to

and yields of
securities, and the
supply of short-term

as

term

know whether this

prices

longer-term

period

postwar

the

serve

of

understood

be

also

that the Treasury

though

most

the

In

operations have been
employed upon an extensive scale
chiefly when such purchases or
sales were necessary to help pre¬
serve an orderly market for gov¬
these

past

Insurance

holdings of governments
by $16 billion, and at
the end of the period government

opera¬

1949,

government

a

of

ance

The whole short-term market has

reverse

a

buys securities for the invest¬

ury

by adding to
supply.
If
long-

banks- make

available

billion.

of

upon

one-year

the

tighten up the money market,
with repercussions upon all classes

clear illustration of the process at
work under such conditions.
Al¬

investments,

term bonds

,

tends
the

securities,

commercial
their
the

ones.

$91

increased

Unfor¬

may

offering of securities to the

commercial

.

a

be gov¬
considerations

rather than economic
An

that

to

company

in connection

with the issuance of
Treasury debt
will stay in the
until

lion

a

most to

Reserve

to

impaired.

policy in

end

interest

from

issues.

to be looked for for

liabilities is

selling on "the part of
investors, it has had an increasing
effect on the psychology of the

upon

Conversely,

a

it

$22 bil¬

thorities rather than

Treasury the Federal Reserve
System has permitted the short-

required to

have

can

securities increased from

and

se¬

the

term

though it is the resulj;
policy of the au¬

even

We

With the

pronounced ef¬
the prices of marketable
Such selling also tends to

ties, it

eral

Reserves

markets.

fect upon

of

increased

effect

an

about

now

portfolio.

a

effect

Treasury elects to sell such securi¬

would lead to the conclusion that

1945, deposits of all commercial

the

marked

the

From the end of 1941 to the close

banks

since

tion

are

government

^its

such

ings of marketable issues by these
corporations and agencies amount
to
over
$5
billion.
When
the

by $73 billion,
and their holdings of government

Gold

the

upon

control. Hold¬

its

under

outstanding that the re¬
quired relationship between Fed¬
Reserve

as

Factor

Market

It

importance

great

of

from

seen

tinued,

been affected.

the skill of the Treasury

utmost.

the

to

for investment.

expan¬

the form of deposit money brought

should

we

effect is produced when the Treas¬

the

of

Treasury without using any funds
which
acts
as
an
which it might already have had
force.
On
the
other
hand
the
hand, as long as the Federal '
Reserve System is ready to buy Treasury is limited in this objec¬
enough of these securities to pro¬ tive by the ability of such in¬
vide the bank with the new re¬ vestors to purchase securities. This
serves
required against the in¬ is determined by the amount of
it

recognize
the
Treasury will be faced with enor¬
mously difficult problems in debt
management — problems which
fact,

that during the years to come

expansion of deposits and the ex-

on

And

of

ter

of securities.

o n

maiket

curities

1967

of the monetary

upon

mercial banks. This minimizes the

i

the

curities.

accounts

portant

becomes

of

of

commercial

immediately

One

putting

securities, and the commencement

opportunities to choose
financing media and to exert
its influence thereby.
As a mat¬

likely to be securities suitable for

It

of

its

government market may be exert¬
ed by the Treasury when it makes
purchases or sales of securities in
the open market for investment

it.

p a n s

crease

re¬

needed.

in

points lower tnan at the end
1949.
As this trend has con¬

repeated

bank

against

has

issues to

frequent intervals, it has

of

attention by those concerned with
might"
the government market.
A pros¬
take $200,000 of these or other
government securities to the Fed¬ pective deficit means that securi¬
serves

at

of

is

means

Thursday, September 14, 1950

callable

such a
policy into effect is the sale in the

have

addition,

in

fund

will tax

of

20%
against de¬
had no excess re¬

it

where

the

to

influence

open

now

amounts of maturing

of
the banking system have been in¬
creased by $1 million government

in

the

that

..

2%

concerned with
substantial
deficit,

Treasury is
financing
a

and,

fact

the

of

.

level, and credit is expanding at
a rate, that some
restraining

such

major

vestment markets.

Chronicle

accompanying

the

in¬

was

significant that the Treasury

and

the

continuing sales
of long-term
ineligible govern¬
ment obligations by the Federal
Reserve Open Market Committee
which

has

securities

many

in

its

to

decline

sufficient vol¬

so

take

large

Federal
this step,

amount

curities

of

Reserve

elected

and to buy this

government se¬
to
permit

than

rather

prevailed for a considerable pe¬
a continuous
riod, and with less urgent market¬
long-term government ing of corporate ^obligations in
that ^he longest 2%s evidence, this pressure upon gov-

bring about
in

to

disorderly markets, and perhaps
billions of such considerably higher yields.
Now
portfolio.
These .that more normal conditions have

sales have been in

issues,

policy has been widely discussed
from many points of view, but It

in short-term rates referred

to above has been

ume

desirability of this support

.

Volume 172

Number 4942

..

.

The Commercial and, Financial Chronicle

(1015)
ernment

in

secuiities

evidence

The

market

'2^s

for

moved

•above

not

the

been

months.

many

longest-term

The

rate

supply

to

in

re¬

buying

1949

and

it has

only been pushed part way
selling cf the Federal
System already referred
to supplement its credit re¬

recent

during the

and

which

strictive policies.
It

of

of

many

institutions, such
companies,

the

investment

life insurance

as

savings

banks,

residual

represent

a

medium.

That

gieat

has

ing

The

(2)
loans.

when

a

leases

funds

available

at

rate

a

become

sufficiently
exchange

attractive to warrant

an

out

The

under¬

of

mort¬

for

doing
tain

in

the

commercial

Commercial banks

'elined to regard government port¬
folios
as
a
source
of
funds
if

investments

record-break¬

during 1950 was
made in forecast¬

trend

clined

alternative

period,

building

requirements

in-

are

in

volume

error

capital

in¬

year.

etc.,

investment

they

is,

chief

prewar

1950.

the

available

gages
the

in

of

the

of

value of real

boom

reached

levels

estimate

is impoitant to
recognize the
that government bond hold¬

ings

the

ing

because

years

estate

•back by tne

is

this
has
large during

in prices and

crease

which

Obviously,

exceptionally

•Reserve

fact

mortgages

available.
been

activity in building
a
large degree the

to

of

upward several points

-during the last half of

-to,

of

determines

support level
institutional

the

sponse

has

for

to

buy

downtrend
for

in

in¬

are

bonds

government

sufficient

supply

obtainable

such

corporate

of

investments
bonds
and

is

mortgages
of

available

accumulating

funds available

as

turities, they

in

balance

Under
ount

to

ernment

that

heavy

corporate and munici¬

of

companies

and

considering

market.

ample

As

long

supply of such

is

available

life

as

invest¬

insurance

-companies, savings banks, etc., are
:the

ket

ma

by

be

to

neutral

a

factor

net sellers

or

in

bal¬

on

This situation is illustrated

ance

in

events

1948

and

1949.

In

these

purchases

and

The

(3)

trend
of
commodity
prices is important.
If an infla¬
tionary

trend

in

prices

is

corporations must
working
capital

way,

their
issues

of

the

under

increase

through

securities

new

rowing from

bor¬

or

banks.

A

pro¬

longed trend of this type is likely
to

bring higher interest rates and
downward trend in

a

bond

government

prices, unless offset by open
operations, etc., by the

market

Federal Reserve System,

1948, the life insurance companies

holdings of mortgages
billion, municipal
obligations by about $400 million,
about

S2.4

and other securities by

^corporate
-about $5.8

billion, but holdings of

'government
.duced

securities

were

by about $1.4 billion.

larly

in

1949,

creased

by

while

about

re-

Simi¬

assets

$3.3

in¬

billion

holdings cf government securities
■decreased

$1.4 billion.
During this period a large supply
'of corporate and municipal bonds
and
at

at out

>y

became

mortgages

yieMs which

available

attractive in

were

comparison with yields on govern¬
ments.

Figures are available for
only the early part of 1950.
Dur¬
ing this period, while holdings of
mortgages

and

increased

bonds

by about $1.4 billion, holdings of
government
securities
decreased
$32

This

million.

during this

indicated

period the net opera¬

tions of Tie life insurance

*nies

in

the

comna-

government

only slightly

were

that

side.
Another

of

come

influence

market

ernment

in

the

which

gov¬

has

be¬

increasingvfmportance is

the volume of funds,controlled by
trust and pension funds.
When

■pens::ons

funded

are

sary to acquire a

•investment

it

is

neces¬

large volume of
to

reserves

take

care

government securities.

on

is

considerable

a

flow

There

back

and

between loans to dealers

forth

government securities

on

collateral
and the holdings of such securities
dealers.

by

as

fluctuations

These

often operate as a stabilizing fac¬
tor

the

in

market.

If

money

is

tight dealers-may purchase a sub¬
stantial amount ; of bills, certifi¬
cates and other short-term securi¬

ties

ing

banks

of

the

ties

carry

lessen¬

a

the
strain
permits the
repurchase the securities.

alternative

An

and

against loans until

banks to

is

the

from

them

this

to

procedure

absorption of these securi¬

by

Federal

the

Reserve

which

tends
to
make
money easy, or the resale of the
securities by the System in the
System,

market which tends to ab¬
sorb funds and tighten the money
open

market.

(5)

market

the selling

on

Loans to dealers and others

(4)

increased

iby

ing.

Foreign lending and spend¬
is obvious that, if the

It

undertakes active
spending abroad the
funds
are
likely to be secured
eventually through sales of se¬
government
lending and

prevailed

part
of
the
cash
deficit has been incurred from the
our

large foreign-aid

been made in past years.

government securities are an im¬

of older

Pension

are43gi owing and will

tinue

to

A

grow.

large

con¬

part

these

funds

grade

obligations of which

is

considerable

invested

part

is

in

high-

normal

course

vested,

while

.beneficiaries
terest

.ordinarily
securities
for

and

are

the

to

and part of

the

to

buyers of
not

pension

funds

except

issues,
types of issues.

Miscellaneous Factors
u

There

'

ar,e .fpany

which enter
more

more

or

or

are

government

sellers

ex^harg°s between

into other

and

in-

made out of in¬

T^us these

but

pension
are

payments

payments

fund.

In the

events

investments

on

"annual
trust

of

accumulate

some

represented

by government securities.
"funds

of

or

.

;oc'

(6)

other factors
less

directly,

the background of the government

.market

(1)

These would include:

The

volume

of




building.

investments

Individual

in

Continuing

influence.

portant

purchase of series E savings bonds
by individuals have provided the
Treasury
w i t h ^ a
substantial
amount
war

variety of
who

governments

activity.

from

great

a

A

own

makes

Transactions

review

have

may

circum¬

many

of

illustrate

to

serve

some

this

may

point.

A

opportunity to

an

loan and need to sell gov¬
ernment
securities
to
provide
a

withdrawn

funds

by

by

Withdrawals

rower.

customers

sales.

The

interest

the
of

deposits

necessitate

may

bank

bor¬

feel

may

that

rates

are
likely to rise
protect itself by sell¬
securities
or
shifting
into

and wish to

to

funds

of

period.

about

in

the

post¬

amounted
in 1948 and

Net sales

$1

billion

conducted
times

campaigns

designed

to

in

recent

promote

the

various

factors

influence

upon

government

give

some

machinery

which

the

•

have

market

art*

for

securities, we shall
consideration to the
and characteristics of

the government market.

The

dealers

government

paying the
they
purchase, and obtaining the of¬
fered price for those which they
sell.
The spread between the bid
bid

price for the

side

offered

and

securities

represents

margin of profit

gross

they

depend

must

to

the

which

upon

operate

profitably. The competition which
exists, coupled with the relatively
large volume which occurs, has
resulted in a narrowing of the
spread

the

between

bid

of¬

and

fered

price to a degree which
exceptional in the investment

field.

markets

Most

shorter-term
with

bonds

of

spread

a

bid

the

between

the

on

quoted

are

only
and

1/32

offered

This

price.

represents a differ¬
ential of only about $313 per mil¬
lion
dollars par value
between
the

an investor would pay
purchases the securities,

price

when he

would receive if he is

or

is

It

frequently
of only

spread

half this amount

In order to provide

less.

even

or

for such narrow

tations

seller.

a

the case that
place
at
a

take

transactions

spreads, the

quo¬

government securities

on

a

issue

at

It

time

receive

may

its

of

pa't

shorter-

term

holdings into longer-term
governments with a better return.
The bank may find that it has
funds

more

required

the next few days
Treasury
bills for a
temporary investment.
An indi¬
and

over

buy

vidual may have

maturing Series

E

savings bonds and decide to
purchase marketable bonds as a
reinvestment.
pany may

turities

An insurance com¬

receive funds from

and

short

buy

ma¬

term

-

governments as a temporary in¬
vestment, or long-term issues for
semi-permanent
holding.
An¬
other

insurance

anticipate

are

at

may

company

making

mortgage

a

usually made in 32nds.

would

receive

more

than

funds

used for mortgage

may

can

be

loans, etc., and

purchase government securi¬

may

Pension

ties.

in

stantly

funds

receipt

con¬

are

funds

of

for

investment and long-term govern¬

securities

provide

illustrative

merely

ern

Market for

Government

Bonds

able

the

various

issues

government

listed

the

on

are

Stock

Ex¬

Y.

N.

volume of transactions in govern¬
ment

securities take

Exchange.

The

in

occurs

place

the

on

the

majority

great

over-the-counter

market at net

prices. This market
is largely con¬
ducted by a relatively small num¬
ber of firms which specialize in

for

governments

this

field.

A

the

by

System,

and

transactions

System

number

classed

are

as

of

Federal

certai/n

these

recognized
Reserve

classes

of

are

conducted by the

through

these recognized

dealers.
Government
make

net

dealers

markets

and

ordinarily
buy

and

iOlebhbne

so

that

the

markets

quoted

by all are in close rela¬
tionship.
A
large
number
of
other stock exchange and invest¬
ment

firms

also

have

orders

in

rela¬

in

notes and bonds in which $1 mil¬
lion is the common unit involved.
view

In

active

the

of

compe¬

existing it is necessary for

tition

government dealers to be
actively
in
contact
with

their

others

and

customers

who

be the source of purchases or
The
larger
firms have

may

sales.

extensive

wire

systems,

in

major financial
usually
extending

fices
and

coast.

In

the

west

salesmen

in

various

traders

and

telephone

com¬

commercial

with

munication

with of¬
centers,
to
the

these

constant

banks, insurance companies, sav¬

banks, corporations, and
other important sources of gov¬
ings

business.

Markets

are

quoted to these customers, and in
of

event

tomer may

offering

order

an

be given
the

the

cus¬

firm bid or
wire.
In the

the

on

that

event

a

market

is

rela¬

the size of the
large, the
customer may give the dealer an
order to purchase or sell the se¬
curities at
a
definite
price, or
with discretionary limits.
An
insurance
company
which
might have a block of $25 million
long-term bonds to sell, would be
likely to handle such a transaction
on
an
order
basis,
giving the
dealer an opportunity to handle
tively inactive

or

transaction is relatively

the order

would

carefully in

a way

which

provide

the most advan¬
The dealer would
of the security among
his customers, perhaps make ex¬
change suggestions which might
seem
advantageous to customers,
and keep closely in touch with
other dealers who might have buy
orders
for this
particular issue.
With such handling, a substantial
tageous price.
seek buyers

order
cuted
same

would

ordinarily

promptly,
day

government securities which they

interest

execute

possibly

through these government

effort

ordinary

reasonably
transaction

size,

dealers

are

usually able to make an imme¬
diate net bid for securities offered
take them

tion.

The

other

dealer

into posi¬

dealer

may have an
opportunity to sell out the securi¬
ties to another customer or an¬

spread
If

is

same

some

turity.

such

some

issue, he

portunity
of

at

price

that already referred to.
unable to
sell out the

as

he

have

may

an

op¬

similar amount

to sell a

other issue of

nearby ma¬
This would make little or

change in the net position of
the dealer, although he would now
be long one security and short
no

another.

It

v/ould

then

the

be

objective to find opportunities to
complete the transactions by buy¬
ing
from
another
customer
or
dealer

the security which he has
"short," and selling the se¬
curity of which he is "long." Close
sold

and

constant

dealers

contact

assists

with

other

in

"trading out"
such positions, and a large volume
of such tiansactions is constantly
taking place among dealers in
connection
It

with

such

activity.1

is

necessary for
exercise careful control

dealers

trading positions.

heavy po¬

sition

is

ward

a

tarried

during a down¬
in the market, losses

trend

would

If

to

their

over

incurred

be

which

wipe out trading profits

could

accumu¬

lated during a considerable period.
Dealers
try to keep closely in

touch wiih the money market and
other factors which would be of

help in determining the
regarding the position. A
endeavors

avoid

to

policy
dealer

substantial

during downtrends, and to
make
profits by enlarging the
portfolio during periods of rising
prices.
Another

of

source

income

to

dealers is from the interest profit
on
securities in position. Dealers

normally

are

large

borrowers

securities in the

the

market¬

and

the

when

ana

except for shortterm
issues
such
as
bills,
certificates and various short

ernment
Over-the-Counter

be

ment securities,

are

great

of

from

offices

the

would

tively large amounts.
$100,000 is
normal trading unit for govern¬

at¬

of

time

more

necessary.
When the market is

a

are

securities.

Although

if

proved

losses

it

occurred

transactions

an

multiplicity of factors which bring
about purchases or sales of gov¬

offered

actual

that

obvious

government securities at a gross
profit of only $156 to $313 per
million dollars par value unless

These

investment.

tractive

an

impossible to carry on business in

very

bank

the

make

is

It

governments to provide the funds

savings

quote

bid, offered

side 101-33/64.

the

A

might

101-15 +/32

101-16+/32, the plus represent¬
an
additional
64th.
This

loan and liquidate some long-term

required.

dealer

ing

than will be

hand

on

days

for sale and

quote

bid and offered prices,

Thus

shift

of

Having discussed in some-detail

charge for handling the order.

a

of

to

savings bonds, par¬ sell into and out of their
posi¬
through
payroll
and tions.
These
firms
exchange
bank account deductipn plans.v
^
quotations with
each
other
by
purchase
ticularly

service

deposits and feel

affected.

dealers

high level, and has

or

less

volume
able

representing the net increases in
holdings of savings bonds after
redemptions.
The Treasury has
been anxious to keep
these in¬
a

transactions

commission

a

con¬

short-term issues which would be

ing

firms

vestments at

these

with

in

It is
customary for prices to be quoted
as
"plus," rather than in 64ths.

$1.9 billion in 1949, these amounts

ii*i o.i

less importantly into

and

posted each day, only a very small

"

-funds

government

change, and closing quotations are

under ECA, etc.

program

claims

in

of

such

are

in recent years a

considerable

financing of

type

surprising

government securities may re¬

Under conditions which

curities.
have

not
banks

investors

of

marketable

ment

•

employees,
against which payments have not

the

-of

number

make

major importance in
the position of the

likely

The

classes

government market which is most
by

is

unob¬

market risk

any

and make

is

bank

sales.

is

other

any

it

investors

It is usu¬
ally the short-term section of the

the

which

securities.

the opportunity offers.

conditions

gov¬

high degree of
combined
with
a

commercial

stances.

se¬

the

a

marketability
degree of safety

sult

increase

and

in

$25 million or more to take place,
particularly in short-term securi¬

in

a

exe¬

nection

advantages

market, and it is not
single transactions of

such

for

may

market activity

major

common

With

they

they have received.
is

unusual for

ties.

them

to

which

active,

$100,000
relatively large in corporate
securities, transactions of $1 to $5
are

looking
in

cute the orders

assume

are

million

dealers,
market

These brokers and dealers do not

offered by government securities.
Whereas transactions of

commercial and other loans when

ma¬

likely to invest

insurance
is

ments

the

plus

funds

government

these
of

life

.an

of

one

in

government

•

is

for market

governments

the
gov¬

superior

This

marketability and

of

pal bonds and mortgages available
^others

a

transactions.

take

to

curities.

-

of

loans, banks are
ordinarily glad to reduce holdings

result of

a

are

the

an

from

that

outstanding re¬
relatively large volume

affected

as

care

.

sults in

In view of the fact that the yield

governments is well below that

expected

ernment securities

tainable

of
governments
into
such
investments.
Likewise, if an in¬

on

be

investment,

shrinkage.

severe

a

to

By

they endeavor to main¬

so

suffer

is

re¬

loans

investment.

earnings which would other¬

wise

It

large amount of marketable

31

if

active

existed
over

a

be

exe¬

sometimes

in

the

institutional
the

issue,

period of

a

or

few

the

banks

finance

to

the

portfolio, and the
rate on such loans is ordinarily
low enougn to provide an interest
profit on securities with a coupon
rate from 2 to llk%.

hand, the

coupon

short-term
such

1V4%

less.

or

securities
tain

and

a

on

securities

certificates

In

carrying

dealer is

interest

an

yield

or

government

bills

as

On the other

rate

loss,

is

such

likely to sus¬
so that it is

desirable to keep the position low
relative to
the
volume of pur¬

chases and sales.
A

*

recognized

cutes

dealer

transaction

a

who

with

exe¬

the

Re¬

System

(the open-market
operations of the System are con¬
serve

ducted
the

through the facilities of
bank) is generally

New York

permitted by the System to make
a
fixed
profit or "commission"
equal to $156 per million on bonds
lesser amounts in

and

bills

other

or

All

the

case

short-term

transactions

open-market

of

issues.

of

the System account and Treasury
trust

accounts

made

are

through

the recognized dealers.
The recognized dealers together
with a few other dealer firms re¬

the

to

port

bank

Reserve

each

morning, showing their gross long
short

and

positions and previous
volume in each of several

day's

categories, and in addition advise
the bank regularly during the day
of

the

nature

trend

and

observed.

ness

tractual

Due

nature

of

to

the

of

busi¬

the

con¬

status

of

the Reserve System
an
extremely high de¬

recognition
exercises

of control

gree

and

the

Transactions in
curities

the market

over

dealers,

government se¬

differ from

those in

cor¬

porate issues in that settlement is
made on the next full business

Settlement

day.

usually» re¬

is

quired in collected funds, orYnay
be made in Federal funds which

represent
of

the

serve

balances

bank

banks.

in

to

the

the

credit

Federal

Such funds

are

Re¬
fre¬

quently in demand by banks who

Continued

on

page

32

32

Continued

from

Reserve

31

page

Factors

Influencing Government

deficiency

a

order

in

banks

Reserve

avoid

in

reserve

funds.

of

absence

The

in

factor

credit risk

any

securities
close adjustment of the
government

makes for

various issues to each other as to

price, yield, and maturity with a
relatively smooth progression of
yield from a low range on shortsecurities to

term

There

maximum on

a

outstanding issue. The
trading which takes place

active
tends

hold

to

such

the

price

steady

a

government securi¬
might be considered,

which

of time

cussion of

the disof the more im-

confine

to

necessary

makes

some

which

range,

limits

may

into

within

keeps

tions

of the
commercial
banks,
necessitating correspondingly large

purchases

sales of government

or

securities.

Under

tions it is the

condi-

present

policy of the Federal

have
or
less
allotted

Continued

been

question period

I hope that in the

which follows we may be able to
clear up any of these difficulties,
and to take up other points which
be of interest.

may

one

l-16/32nds point
above issue B, the bank may sell
issue A and purchase issue B if
the price spread
widens out to
l~20/32nds points.
If, at a later
day, the price spread narrows to
l-l4/32nds points the bank might
reverse the transaction
by selling
issue B and repurchasing issue A.
Having made the original trans¬
action
at
a
price "take-out" of
sells

ordinaril.y

l-20/32nds and reversed at

transactions

constantly

are

taking place and are very effec¬
tive in maintaining the stability
the

market.

government

Segments

J-...-j

1

~

~

ments due to taxable status

—-

the

or

bank

nated

b,y the purchase

non-commercial

and

of

one

feed

of

a

period

those.
is

now

cf

of using
A
large

means

oil is pressed out.
The latest development which
perhaps is the romance in the industry, if you will, is the use of
steep water, the water in which
the corn was first soaked. Formerly it had been thrown away,
Now it contributes to the production of penicillin. It is a feed
for the mold that produces the
penicillin.

If

it

hadn't

been

for

steep

water, the development of
pencillin in volume would have
taken

much

a

They

also

are

making

sub¬

a

stance called inositol which is
of the

one

ties

unable to purchase them.

which

have heard

you

cently,

also

are

much

obtained

re¬

from

It is

as

showing real

Glu-

prom-

ise in the treatment of arthritis,
and it is

That

inexpensive treatment,

an

is

the

in

romance

That

is

the

this

in-

possible fu-

ture

growth in the industry. That
also the explanation of why

is

companies

spending

are

large amounts for research labor¬
atories and research work.
The

Main

Now, what

Markets

the

are

main

mar¬

kets?

Substantially all
re-

fined sugar go into food products,
Crude sugar and dextrine, which
is a form of starch, are used for

industrial purposes.
Starch is used by baking powder
manufacturers, confectioners, bakers, brewers and in the home
for baking and laundry work;
have
been
discussed
previously, starch ^..so has a large use in the
produce a relatively high volume textile and paper industries, and
of activity in this section of the
in the production of adhesives.

They

large holders of
issues, and the various reasons
for making changes in the
portfolio holdings, some of which
are

very

such

market.

Banks are constantly ad¬
justing their cash position through
the purchase and sale of Treasury

bills and certificates of indebtedwhich

edness

readily

narrow

The

active

be bought
large volume

may

in

Federal

yield

market

level in

Treasury
policy.

and

line
as

Federal

and

by

that

Reserve
necessary

Reserve

other

the

maintain

banks

their

meet

their

For

there

beverages, ice

mine

and other

the fields that deter¬

demand

for

the

chief

corn

products, and therefore basi¬
cally, as you can see the demand
is dependent on the level of con¬
incomes.

sumer

of

the

However,

industry's

industrial

users

output

and

much
to

goes

much

of

the

rest to commercial users; many

order

reserves,

at

large

to

a

obli-

time

flow




of

corn

for

not

profits,

half;
words, until the crop of

billion

nearly

to

1.0

When

in the

changes

2.0

mostly because
people bought more, canned more
pounds,

of everything, and there was a big
demand as a substitute sweetener
for scarce sugar. Sugar also went
up substantially.
Most of the industry's output goes into bulk
goods for large users, industrial
but

otherwise,

and

a

and

year

a

much

is

im¬

later,

was

har¬

November

and

De¬

year

one

in

vested

knowing

By

decide

could

whether

wanted to take

you

tion, whether
purchase

them

could

You

was

workings of
the industry, you would be aware
that there is a reasonably definite
limit

time

the

the

to

profit margins in the corn refin¬

let

industry,

point out

me

technical factor which

the

the

is

competitive situ¬
place, within

is keen

there

industry

petition

com¬

not but-throat com¬

but

im¬

portant. In most of the industries

first

the

seems

a

have studied,

you

have

been told

of the

or

I

suppose

you

know,

one

you

things to watch is the per¬
relationship of operating

centage

petition. The reason is that there profits or costs to sales; in other
are only
11 producers and it is a words, the profit margin or the cost
very costly industry to enter.
It ratio. In the corn refining indus¬

is very much unlike, let's say, the
beverage industry, where you can
set up a bottling company in a
garage if you wish.
It costs several million dollars to put in a
corn
refining plant.
The Corn
Products Refining Company just
finished a large plant in Corpus
Christi, Texas, which is the first
plant built in 27 years.
It cost
$23 million dollars, so within the
industry
that is
an
important

try,

competitive factor,
The
real
competition

in the

hand

starch

corn

and

tapioca

on
on

the

The way to measure

3.33 which comes
the gross corn cost

to

by

$1.15

$3.83

of

as

100 lb.

a

pound bag of dextrose.

These companies, as I have told

get

you,

certain amount of by¬
under
their
ac¬

a

products,

and

counting methods they credit the
full

corn

cost

to

fill

the

and

competition is with

equal
or
competitive price of
sugars,

cline.

sales of
All

adjusted
corn

that

the

and
The

same

de¬

,

since

and

by

is

the

denominator

the

of

of

volume

industry.

volume

helpful

are

There

These

and

profit

in

favorable

or

is

a

profit spread

price

mately
Let's
is

of

one

of

way

condi¬

margin

$2.30,

and

spread

or gross

is $4.52.
If

little

over

dollar

a

ground

corn

by

3.33

of

a

bushel of

per

and

and

margin

average

an

into

convert

divided

you

get

you

to

want

you

bushels

connected

to

dextrose.
Just to show you

the mechanics

of this 40% rule of thumb: Among
the
by-products
you
get
1.7

pounds of oil
and

of

bushel of

per

the time the

at

about

10

17

cents

equals 570
trose

bushel

a

bushel

times

3.33

Similarly,

16

by-products

feed

of

so

100 pounds of dex¬

per

of

price

pound,

a

by-product credit

a

produced.

pounds

corn,

market

cents

will have

you

per

with feed selling
a feed by¬
product credit of about $1.00 per
at

$38

100

oil

corn,

ton

a

produces

pounds of dextrose. The total
and

thus

feed

by-product credit is

about

$1.57vper 100 pounds
dextrose,
closely
coinciding

of

with

the

byproduct

$1.53

obtained

above

credit
40%

from^the

rule-of-thumb.

Just

show

to

spread

was

in October, 19411

good

a

this dextrose

you

can vary,

there

corn

crop

am

the

price was down to $1.15, pro¬
ducing a gross spread of $4.52 per
100

to

pounds of dextrose but in the
spread

on

$2.35, and the

dextrose dropped

$1.82 per 100 pounds. It varies

all

and it is something that
must watch. You can do ex¬

over

following

occur,

the

products

spreads

however.

because

dextrose

tend

to

that

which

on

fluctuate

widely at times. I again neglected
to tell you that dextrose is priced
in
relation
to
the
competitive

de¬
of

price of

is

sugar

cost.

All

almost regardless of
other

products are

about 70% of the sales dpllar'in priced relative to the cost of corn
the industry, the level 'of 'fcdfn ftcP the 'Ykffn'ers, but even here
f R MOC! .71:
JW* 'HC P'- U
••
prices': relative, to the ."revel - df

the

actly

same

sort

thing for

of

bulk. The only difference on these

products is that you do not
the

take

freight credit.

This does not take into account
the

effect

on
net operating mar¬
fluctuations in volume.

gins

of

This

business

is a high-volume
Therefore, if volume is

business.

high, this $4.52
net

lot'higher
fff vol¬

means a

operating profit than

ume

is

low

under the

same :

gross

spread.
In

sis

conditions approxi¬

they

as

take

profit

regardless of

cost

industry
companies

tions of that period known.

the
cane or beet
products de¬

corn 1

the

adverse

tapioca and starch.

Therefore,

bushels

ficulty with these indices is that
they generally are not available
until after a period is over and

the

true

mention

of

following
trends in the corn refining indus¬
try.
Substantial
variations
de¬
velop from time to time. The dif¬

exceed

is

per

number

by

spread

a

to

throughout

and beet

are

cents

individual

indices

use

neglected

the

common

factors relate

margins

you

some

I

ground

prices then have to be

downward

cost,

creased.

corn

of

ground.

have

syrup,

words,

spread

the

syrup

cost is

corn

by-prod¬

Therefore,

publishes the New York price of
all
the
basic
corn
products in

other,

primarily to price. In other words,
if the price of corn is so high that
of

of

$1.53.

starch and syrup. The "Journal of
Commerce"
every
Wednesday

sugar.

These competitive

net

sale

case

profit
bushel

tapioca

cane

from

ucts, in this

other

above actual, just

displaced

dextrose

the margin

against

By rule of thumb, you
get back about 40% of the gross

you

mand.
In

these

costs.

be-

might

volume

total

been up to 14%

from

revenue

corn

gross

refining industry is to

corn

mul¬

so you

divide the operating profit by the
number
of
bushels
ground.
In

the war, but in the late prewar
period tapioca
imports at one
time reached a level of 14% of
the
total
corn
ground
by the
corn refiners.
That is, had there
been no such imports, the industry's

don't tell the story.

and

Measuring Margin of Profit

normally comes
Java, was cut off during

from

map

30

tiply

bushel

one

is

the

the

is

about

get

you

a

next year corn was

which

Tapioca,
in

division

starch

industry's
tween

technique

this

misleading
and
should
not
be
used. The price of corn in the last
10 years has varied from 50 cents
to almost $3 a bushel. Therefore,
if you
use
percentage ratios of
cost or gross margin, you get per¬
centages that fluctuate all over

the

in

believe

I

First, at

selling at $1.15

was

and

Now,

pounds from

was

margins and earnings

on

stable in

more

Competitive Situation

In

effect

adverse

basic cost?

the

$6.70

was

250rz$6.82.

corn

bushel,

a

be¬

subsequently

knowing

cause,

ing

What

re¬

Incidentally, in calculating

demand.

ation?

ac¬

wanted to sell

you

securities.

these

there

and

then

into packages,

part goes

that

and

fairly

a

other

1948,

corn

of

large size.

are

from

the price of dextrose and the

are

the

cream,

economic picture take place, these

short-term

a

by confectioners.

which

in

instance,
is

for

short-term

required
*

primarily

food items.

System
large amounts of Treas-

bills

gations.

at

matter of

Federal

government, securities

when

with

It is frequently

the

to absorb

and

in

maintain

a

used

is used primarily in the
baking industry, by canners, and

or

System is

to

doubled

Sugar

Those

Reserve

this

which has been set

sold

Syrup, is

table syrups and

price spreads.

in

the

not

three months ahead,

or

almost

what

plus

that time

real question

a

or

reasonable

month

price of corn
substantially,

going to be able to

were

but for

1.0 billion
billion.
Syrup

1.5

to

teins, including amino acid, about

of the syrup and most of the

The market for eligible securities, particularly those of shorter
term
maturity, is largely domimated by the commercial banks,

one

was

whether

refiners

went from

pounds

Vitamin B complexes, and
other potentialities. Pro¬

third into food.

savings banks, etc.

production

possesses

ties because of the fact that banks

insurance companies,

that the

going to go up

to

as

beginning of

1947, you could be reason¬
sure

and that there

products. Starch

for this industry's

portant

longer time.

These securiprovide a yield substantially
higher than that of eligible securi-

as

In the

130

your

Over

Taking the main product,
starch, for example, of the total
output, as you can see, [indicating chart] about two-thirds goes
into industrial purchases and one-

tions such

frosts

early

bag of dextrose

less

your gross

sales

institu-

bank

to

Therefore,

proceeds from the sale of the

the workings of
the industry, therefore, in June of
1947 you could plot approximately
what was going to happen. You

domi¬

largely

be

the

cember.

these

is

so

would

danger, therefore,
that the corn crop was going
short.

price plus
have

the freight col¬

average

mature

it

that

than usual. The

be

York's

On the average

substantial expansion in demand

sued

securities

fall

the price

Chicago might
another price.
and

lected is about 25 cents.

a

vulnerable

more

New

would

corn

the

freight,

with

contrasted

as

might be $6.90, which

be

produced

meal.

dustry.

fliese

in

late

would

did

crop

hand,

Detroit

in

from the hulls after the
by-product

eligibility status of the out¬
standing issues.
A group of 10
long-term issues which were is¬
during the
war
are
not
eligible for commercial bank hold¬
ing until certain later dates com¬
mencing in 1952. The market in

meant that

would amount to 13 cents. On the
other

the price in New York,

month late.
mean?
Well, it

that

$6.70

was

2% discount for cash [writ¬
on
board] and that

in

the

time they devised

curone.

The government market is more
or
less divided into several seg¬

In the
heavy
much so

corn

until

in

did

What

The

corn.

get

York

of

price

the

1949,

New

figures

ing

serving the retail consumer more
directly. This is a significant investment factor,
During the war there was a

and

curonic acid merchandised

Market

plant

not

ably

steep water. Some of the products
have real promise.
One is glu¬

of Government Bond

to

make

price

a

"pay-up" of l-14/32nds, the bank
would now be back in the original
security at a profit of 6/32nds.
Such

4

page

Industry Securities
amount

of

sale

a

because

important.

very

in

of 1947 there were

June,

from

a

and purchase of another, with the
expectation of a reversal back to
the original security when an opportunity occurs at a more favorable price spread. Thus, if issue A

ury

illustrate,

me

in

hundred pounds. The corn re¬
like the sugar companies,

per

give a

that the farmers could not get out

was

Focd and Food Processing

every

for

is

was

issue

the

this

to

departure of as

a

bring arbitrage trans¬
play. Such transac¬

involve

sold

Let

to some of these items may have
been insufficient to make clear
the point or principle involved.

2-4/32nds from the usual

as

actions

ace

time.

October,

that

action

investment

needed funds. U. S. Treasury
operations frequently bring about
lorge shifts in the reserve posi-

any

normally

narrow

of

you

In

dextrose

so

up,

rains in the Midwest, so

amount of short-term securities to

If the price spread is one

of

work

Thursday, September 14, 1950

.

finers,

how these factors
can
frequently take

effective

.

full

know

you

.

the

before

show

effects

adverse

if

frequently evi¬

are

time

touched on more
briefly. The brief space

corresponding

a

yield

or

served.

t

sugar

some

spring

departure from
this normal spread is quickly ob¬
that

tions

dent

portant characteristics which

havO to sell

may

issues

various

spread,

little

versus

other phases of

many

the limitation

but

into circulation, the banks

money

are

the longest

at

tions in

the Federal Reserve to obtain the

Federal
to

at the

credit

Fortunately, impending distor¬
the price picture of corn

or

the market in

it

immediate

purchase

to

ations in short-term interest rates.

ties

Bond Market
an

System

these securities in order
avoid undesirably large fluctu¬

supply
to

need

Financial Chronicle

The Commercial and

(1016)

addition

such

to statistical*

the

as

above.

is vital in any investment
work

that

managements

companies

in

It

fective

going
pating

is

on

which

of

learning

the

of
is

inter¬

most

what

ef¬

is

currently, and of antici¬

what

is

going

Otherwise, it is all
before

he

usually the

way

it

security

analyst periodically

an

interview

ested.

analy¬

think

I

you

to

over

know what

happen.
the dam

has

hap¬

pened.

-

large

users

cut down

or

build up

inventories, and for brief periods
therefore
more

this

industry
cyclical than, let's

chewing

gum

companies

• •

sugar

and

tapioca

prices,

when

be tapioca is available, is perhaps
the the
most
important
single1 inothers vestment factor in this industry.

norm^} profit, .spreads.. a,re some¬
times

reduced- or

increased), de¬

can
say,
or

pending
of

cane

on

I

should like to give you a few

points

about

the competitive prices ^Refining

sugar and

tapioca.

lustrate

the

Corn

Company,
some

-

Products

again

major

to

il¬

accounting

Volume 172

Number 4942

..

.

The Commercial and Financial Chronicle

(1017)
and

other factors

pertaining both

notes,"

to this company and to the others.

should
in

Analyzing
I

think

the

1949

Corn

Statistical

all have

you

Annual

Products

please

you

Data

Report

Refining

turn

the

Co. Will
balance

the

to

of

sheet

page? Now, this is an ac¬
counting point which is common
to

several

and I

too.

am

If

asset

processing
look

the

"Stocks

under

see

down

"Investments"

under

will

you

will

you

side

companies,

to other industries

sure,

of

Subsidiary and Affiliated Com¬
panies, Not Consolidated, At Cost
or

Less,"

sidiaries
million

that

domestic

carried

are

and

sub¬

nearly $5
carried
at

about $13 million.
The

Corn

Company

Products

world. It has plants

America.

plants

There

in

the

Refining

all

the

over

through Latin
important

are

British

Isles,

Hol¬

land, Belgium, France, Italy, and
Germany. Germany was one of
the

biggest plants in the prewar
period. They had the misfortune
of having the Russian and Ameri¬
Armies meet at

can

river

the

on

which the plant was located. Un¬

fortunately it was on the wrong
side of the river, and the Rus¬
sians completely dismantled and
it.

removed

However,

they

have

re-established two German plants
since the war.
The

company's

sheets

ance

resent

as

nothing

business

detailed

you

but

(except

figures

the

for

covering

rep¬

domestic

the

bulk

investment

in

subsidiaries) and not all of that.
They have important
domestic
subsidiaries

that

not

are

dated. All of these

lar currency,

and

consoli¬

represent dol¬

shortly, the company's earn¬
ings reports include nothing but

the dollars earned in their domes¬

refining

corn

whatever
taken

operations

dividends
of

out

nies

amounted

$.1,211,000

plus

they

their

and

In

other

companies

unlike

words,
that

many

fully con¬
solidated balance sheets, the Corn
report

Products Refining Company's
earnings reports represent dollars
in

the

ment

till

or

usable

dividend

for

reinvest¬

payments,

and

the reported earnings are not the

complete picture.
Now,

if

will

you

"Other Income"
you

will

received

nies"

from

under

the next page,

the items "Dividends

see

from

and

on

look

Domestic

"Dividends

Compa¬
Received

Foreign Companies." If

will turn

one

more

you

page to "Foot-

received

from

these

approximately

$413,000. The difference

between

those figures represents additional

earnings
the

that

just

are

stockholders'

though

they

dividends

good
the

much

as

earnings
taken

were

and

they

as

out

in

just

are

Similarly the

com¬

pany's equity in 1949 earnings of
foreign subsidiaries and affiliates
estimated

which

at

$3,765,000

dividends

of

accounting

factor,

I

how

adjust earnings to

we

see

what is going on.

By

the

is

good

a

without

They

rule

behind

this

they make

point:

has

reserve,

when

the

the theory
accounting
is
that
goes

up,

inventory profit

an

on

the

many

on

a

comparable basis, you cannot
draw
sound
price
to
earnings

During the

ings and throw it into
Since

the

that, they

recognize
tax

not

is

shown

doesnt

must

that profit even

on

reserve,

a

government

pay

a

though it

the

in

reported

earnings.

I

going to

am

Accounting

cover

a

on

dif¬

very

ficult point here. It has

bearing

a

lot of companies. That is the

a

method
used.

of

I

how

inventory
not

am

much

but

there

which

an

down, they experience

goes

inventory loss, but they

pensate for

that

of

and

reserves

com-

by taking it out
throwing it back

into the earnings

Again, the

gov-

ernment

doesn't

recognize

that,

give

they

the company a tax
the inventory loss that
doesn't show up in
earnings.

Now,

what does that

will

you

look

at

mean?

the

If

price

demand

when

the

Texas

had

for

that goes into an

determines

inventory
of

cost

in

its

come

10

that

one

into

the

the

last-in,

whereby the latest

goes

in¬

during

vogue

That is the

years.

first-out
chase

into

comes

the

goods sold.

Another method is the

has

cost

pur¬

of

the

Corn

Products

has

is

entirely its
going to explain it to
it

illustrates

lems

I

own.

am

because

what

prob¬

analyst runs
into, and how he must study these
things.
i

Corn

Products
basically uses
first-in, first-out system, but
they also have a "normal stock"

the

which

amounts

bushels

of

equivalent.

to

down

against

bring

to

that

they

late

in

net

a

5%

or

stock

cost

corn

prewar

they

cost

the

had

experi¬
In

years.

this stock

carry

around

does

that

50

cents

to

mean

serve

still

of

out

the total

up

that the

so

carried

38%,

was

didn't

you

ventory

a

re¬

at

earnings

to

inventory

normal

50

cents

re¬

stodk
net

is

in

products

wonder

labor

of the

ment

and

natural

to

price

goes

$3, they have to add another

cents,

which

ings.

out

comes

of

50

earn¬

^

CROSS

That means that when the
price
of
corn
is going
up,
they are

must carry on I

crease

in the price

extent

of

penalizing

are

the

reducing

when

take

earnings

the
out

of

normal

it

by

price
of

old,

and

the

in¬

to the

corn

stock.

that

goes

that

They

amount

down. They
the dif¬

reserve

ference between the
the

by

throw

new

it

cost and

back

into

earnings.
This

method

counting

is

government

0




'

not

for

inventory

allowed

by

ac¬

the

tax*;( purposes.

Therefore, when th^,
p?ice of cqrn
goes up, they are not only penal¬
izing their earnings by the in¬

(tor,'

i

of

"-1

crease* <dn* the price of corn, times
;the;<5Vz. million bushels of normal

can

maize

use

as

it

use
a

rather

than

material

raw

milo

for pro-

ducing starch and dextrose, there-

of

These
that

in

of

ic

£actors

we spend $23 million for
plant and we are not grt_

new

ti

such

bene£its

the

as

then

shou,d question management
to why such expenditures are

you
as

justified.
I have tried

in

dicate the factors
for if

uses

coal,

illustrate

to

points

numerous

type of equip-

place

strat

know. If
a

high,

are

th

are

investment analyst should

an

front

machinery, and it

gas

at

you

order

in-

should lookf

you

going to be

are

these
to

in-

an

vestment analyst
—

~

_

continued from page 5

Observations

.

would

you

alone, holding that Communist ideology breeds on want—an ex¬
given also by individuals as Lee Pressman in alibi-ing his
having joined a Communist cell because of our Depression of the
1930s.

in¬

method

think

why,

and

something
was
earnings understated,
which is just the answer by com¬
parison with results under the

straight first-in, first-out method.
They are are understated by the
amount

out

of

and

these

taken

reserves

thrown

the

in¬

happened in 1948? Well,
price of corn declined. When

this took
to

place

the

see

would expect

you

effect

of

the

resulting

inventory loss and the tax credit.
However, they were offset in re¬
ported

earnings

taken out of
back

by

the

amounts

and

reserves

thrown

into

then

and

27%

back up to 32%.

for the

This

We

was

France, despite a great rise in living stand¬
resulting from three years of Marshall Aid, is faced with
stronger domestic Communist opposition than previously.
ards

That Item

Now
cost

element of

spender

even

of

this

well

as

Truman

professes

get

you

inflation is

one

of

the

initially

is

programs

that

merely

for

Point

Institute

realize

that

specified

danger

of

We must

greatest enemies.

our

time when

the

by

of

cost

all

subsidy-

faltering first step of "the camel getting

a

his head in the tent."

proposal

extra careful look at the

other projects—a

to

know

time

an

all

as

wholesale

Affairs

Cost

surely is the time to give

Hardly had the President made known his

IV

on

through

$45-million

a

Messrs.

key,

James

before

the

Public

Warburg

and Dewey
demanding the program's expenditure gf $5 to
$6 billion (not million) during each of the next 50 years;]
^Senator
Brien McMahon was
winning wide acclaim for his demand for
expending $50 billion during 10 years in a "stupendous" new
Anderson

to

of

some

into

as

the

in¬

an

be

per year

[sic] Investment."

All these spending-proponents

seemingly over¬
inflationary aftermath of such outpourings $
would result in the descent of the dollar to the Chinese
level, with
ruin to the recipients as well as to our own
citizenry.

vestment

analyst, which you must
study and understand. Now I am

Point IV and

just

going to show you a few of
the adjustments we make to re¬

of

earnings

becoming

have

for

what

been

the

purpose

they

under

methods

more
generally
used.
adjustments relate to first,
the inventory reserves and, sec¬
ondly, the undistributed earnings

These

in

unconsolidated
Let's

take

the

is

as

frequently represented,

$4.41, and $4.87. What

are

the ad¬

+ $2.16,

—$1.99,

actually caused

was

newly industrialized
The
In

its

So

+$1.15.

that

the
adjusted
earnings
$3.42, $5.43, $9.15, $3.62, and

were

$5.74.

one

of

inventory
the

reserve

methods

is

just

numerous

companies have been using to iron
out the peaks and valleys of re¬
ported earnings. As the result of
the

depression

experience,

felt that investors

Such $narp

were

they
scared by

fluctuations. An

-^iys+.sjiould

dig

below

face and figure what the

billion

are

under

methods of

the

more

the

other

a

sound

uninsured

of

trade.

The

con¬

1913-1937 decline i»

severe

trade to

the

Point

investment

IV

is

perhaps

community.

of

On the

greatest

one

so-called "insurance" provisions, which

the

legislation

which

has

been

passed

hand

are

by

an

the

being promulgated in the Senate, might deem to be
World

transferring losses

War

I)

from

his

(which aggregated

back

to

the taxpayers.

hand, however, he must realize that investment is
nere

and abroad; that the sound practises

Bank, which has already extended $1 billion of loans
businesslike

already

basis, will be undermined; and that the

outstanding private

investments will

dis¬

be

criminated against.

Moreover, the American investor will
as

an

Far

"Cited
IV

as
in

imperialism
and

being
a

a

boon to

the

.

come

aims

be thought of

to

through

jumbled

it is being projected.

from

seen

American

contradictory

program as

cally

of

agent

peculiarly

normal

inventory accounting,

or

foreign

study by Professor G. D. A.

by the halving of her

provisions

the

to

after

of the World

an-

the sur¬
earnings

our

a

Guaranty No Investor Boon

thereby being socialized

on

This

part

House and is

On

+$1.20, and

in

investors

our

actually would,

industrializing countries of the world.*

helpful to the investor in

undistributed earnings were +640,

+930,

and

guaranty

interest

integral

$15

+280.

Business

realistically by

MacDougall, showing that England's
exports

The

+ 360,

and

help

trary conclusion is evidenced

earn¬

justments? To adjust for inventory
reserve
changes, they were for
the respective years
+50, +360,

Own

is whether the industrialization of other
countries

subsidiaries.

company's

Our

Another factor to be considered

would

accounting

.

of international "investment"; and Benjamin Javits asks,
outdone, for Point Four-ish outpouring of $20 billion
over the next half-century, in a book entitled "Peace
by

program

not

out

was

look the fact that the

year.

illustrates

problems

It

.

that

see

this

into

What
the

cuse

these guaranty,

the

the

costs

latest

share figures as $2.73, $4.71, $6.06,

If

plant

corn

This plant has everything in the

to

bushel.

nearby
plants.

and comes in at a price which .is
competitively too cheap, the Texas

vital cost saving factors.

direct

a

un-

backyard

from

ings of 1945, 1946, 1947, 1948, and
1949. They were reported in per

$2

are no

refining

corn

you

this

wrong, with

per

equal

RED

the

right

bushel. In other words, if the
price
is $2.50 they carry a reserve

Your

with

canners

would

you

know

accounting

would

ported

reserves

their

in the fourth quarter. For
the whole year it was
44%.

its

low¬

earnings? I am not going
through all the details, but if corn
costs rise they have to set up ex¬
tra

rate

the

sky-

calculate

you

percentage of net before
bearing in mind that the

earnings. In 1948 the
corresponding quarterly income
million ..tax ratios were 37%, 20%, 12%,

carry reserve

normal

levels

to

corn,

They always

went

corn

water

to 36%

method

a

you

ideally

investment

an

told
crop

ventory.

product first.
that

If

I

corn

by

If tapioca comes back from Java

the company s new plant It is
harvested mechanically and taken
right into the plant. Moreover the
plant is located on an estuary
where ships can take the finished

way

as a

If

inclusion

account

come

short

a

mar-

confectionery industry

West Coast

competitive

ma-

short

a

serve

of

plant is well

market where there

refining

corn

taxes

dextrose,
and
the
company's
British plant with starch, not to
mention the growing Southwest

Thus,

raw

standpoint

new

the

and

of

and

of

new

right

grown

45%, 46V2%, and then went down

methods by

is called the first-in, firstbasis, in which the first item
for

remember

you

price of

rocketing.

normal

adequate

the

to

East Coast

end

about three feet high and its

much

up

have gone into it,

several

company

first

shows

had

the

taxes,

over.

source
a

to

in-

is more limited than that of by capitalizing on the
competitive
regular corn. You can plant and tapioca factor rather than suffcrharvest it at a low cost. It is ing from it

find that quarterly rate
ran, 46%,

familiar

One

out

1947,

taxes

was

an

competitive
terial

destined

was

war

corn

than it does normally.

so

we

and

that the effect of

see

changes

more

inventory figures.
out,

will

with

too

you
are

a

accounting

From

located

pro-

much

purposes;

plant. Milo maize is

Conversely, when the price of
corn

this

feed

been

the

*_.•

kets, the

expanded for export and domestic

earn-

has

in

economy

dustry.

greatly

was

animal

In

Inventory

in Texas,

war,

heretofore

the ideal in

plant of the Corn Products Refining Company in this connection,
duction of milo maize

which

caSo

and

inventory profit out of the

you,

of

plants

new

their normal stock. They take that

ratio comparisons.

Method

lower cost than in
the company's Argo
plant at Chi-

additions of recent years. I shall
pick at random the Corpus Christi

are

build

V>

corn

tax

the

on

with

these

What

71^

further

price of

the

since

substantially

closing word to
show you some of the points
you
should
examine
in
connection

you

ported

j

these

company. Unless you can put them

be compar¬

bushel.

,i«;

of

When

at

!

tax-free

One

out

reserves back into earn-

already been paid

challenging

not

may

other words,

H".h-

inventory

are

decline

be

other

one

door.

est

*f ij V

the

Just

company's

enced

ri'i
)rlgior

earnings

taking

down,
benefited by
goes

proper comparisons are to
made with other companies.

quarterly income account figures,

basic

; jBfll
Hh'rro

price

if

able to those reported by another

this

,ib viiiu od;

the

credit for

to accept reported

never

earnings
them.

it

way,

of thumb

tax

and

will try to tie in the two to show
you

their

from

$1,657,000

received. Now, if I may turn
from that for a moment to another
were

important

When

as

the earnings reported by

as

company.

last

domestic affiliates.

approximately
1949, and that

subsidiaries totaled

have

foreign

to

during

dividends

I shall show

as

you

tic

equity in earnings of domestic
subsidiary and affiliated compa¬

bal¬

them

see

important part—you will

an

stock, but they also pay the
the amount charged out.

on

are gen¬

notice the company estimates that

is

operates

they

its

at

foreign

annual report;

an

erally

copies of

—
and by the way, you
always read the footnotes

33

the

above-cited

the

of

-

investor, it should be

liability.

,

IV

Point

•

,

realisti¬

.

"Foreign Policy Reports"—"THE UNITED STATES AND POINT

PROBLEMS,? by Howard C. Gary, Sept. 15, 1950.

;

,

„

34

The Commercial and Financial Chronicle

(1018)

To

these

be added the Continued jrom

may

This doesn't

Markets

Korea and

that such

mean

Taxes

vicissitudes of

the

On

news.

$16

billion

billion

in

in

1930

As

1950.

$88

to

of

matter

a

ment

budget

Says—
of

market

the

at

the

on

start

week when the stocks of the

pendulum swings
it will

too far in one direction

direction.

wasn't

It

exactly

that limitations
its

secret

a

such cred¬

on

part of the general
mobilization plan.
Newspa¬
were

wrote about it; commen¬
tators discussed it. In fact, if
pers
it

was

worst

it

secret,

a

kept secret

week

firmed the

the

the

former.
will

duplicate

rails

the

of

action

cated

indi¬

of

presence

Theoretically

be

con¬

latter; the failure

of the industrials to

the
there

confirmation

full

no

recent industrials

the

rails

the

in

the of the bull market until the

was

in

Still when

times.

ory we are

last

❖

*

order

which

to

go

another

means

high

a new

eight

down, via a Presidential points or so before it is seen.
But waiting for a full con¬
speech, the market took one
came

look at it and

ran

the

*

*

*.

firmation

away.

The

point of all this is to
reiterate that buying stocks
(or selling them) in anticipa¬
of

tion

futile

most

is

news

of

one

the

things to engage

like

is

train

fore

waiting for
start rolling be¬

to

*

*

ing

S., Baltimore: "Buy¬

weakness

on

*

weakness

.

means

individual

the

in

."

.

Obviously you can't
buy the market.
But weak¬

My

*

*

opinion

considered

is

in

ness

stock

a

not

accom¬

that the automobile and tele¬
vision stocks

is open to

little

[The

an

article

than

lime

opportunity to buy rather
a
signal to sell. The next
few days should tell the story.
*

*

ter

means

war

a

ing companies

as

against the

outfits.

Everybody

knows that

during

major effort is towards

production of
minimum

war

of

the

goods and

civilian

goods.

The ideal is to find companies
that

the

necessarily
with

at

any

those

latter,
are

as

explained

the oils ,and

BOSTON, Mass.
Tobias

is

with

R.

Boleslaw J.

—

H.

Johnson

&

Co., 70 State Street.

CHICAGO, 111.
has

—

South

La

Salle

Street.

Co., 208
He

was

formerly with Norris & Kenly and
Shields

&

Co.

With

Los

York

Stock

San

Francisco

Stock

Chicago Board of
14 Wall Street

COrtlandt 7-4150

Trade

New York 5, N. Y.

Teletype NY

Angeles Stock Exchange.

Per

100 Shares Plus Tax

Y'ngst'n Sheet@ 93% Oct. 11
Bethle. Steel. @ 41% Nov. 15
duPont de Ne. @ 80% Dec. 16
Homest. Min. @ 36% Dec. 12
Mission Corp. @ 62% Nov.
1

•

575.00

Unless

war.

the




national

225.00

425.00

@ 70% Nov.

Subject to prior sale

or

9

450.00

387.50

price change

THOMAS, HAAB & BOTTS
Members

Put

&

Dealers

50

Calls

Brokers

<6

Assn.. Inc.

Broadway, N. Y. 4, Tel. BO 9-8470

the

same

the

the

years

Federal

the responsibility for the develop¬
ment of our natural resources and

always been glad
reasonable taxes to see

pay

properly

resources

and

preserved.

emer¬

we

These
three

not

are

"guiding

the

is

President's

principles"

For

Next Three

the

three

next

the

of

make

it

years,

development of atomic

Primarily Agricultural," the ex¬
penditure in 1939 was $178 mil¬
lion, in 1950 it was $964 million.

we

There is another

States,

Federal

budget

portation

ex¬

under

penditures in connection with

our

ment carries out its

defense,

(2) It will stop buying
nice
we

things

to

which

some

would

of
be

But

not

with

than

defense

having
it

to

did

for

been

1950

the

will

Here

during

in

then,

which

and

than

level

a

which

cut

level

further

which

of

would

the

$5

to

two

realize

that

in

another,
debt

is

sooner

have

to

pay

to

to

that

they

tell

their

mean

get

these

expenditures

Let

me

give

In

first

from

the

conceived

as

a

I

there

is

and

built

munities.

Aid

their

their
from

could
you

that

be

Resources

of loan

aid

and
were

investment pro¬

agriculture,
never

which,

needed

own

com¬

govern¬

1939

grants in aid

million.

The

current

states

another

in

the

kind

form

of

one

Federal

of

as¬

sistance.
Under
we

conditions

war

face

now

for.

pay

if

But

are

bought, the states

the

money

people

such

they

collect

can

direct from their

at

lower

a

as

probably can't
of the things these
we

own

than

cost

by
routing it through Washington and
back on its way to where
they
will

it.

use

I

that

suspect

been

a

there

has

expensive

more

never

money-

raising and handling agency than
our

present

Federal

government,

point of view which would

a

to

be

borne

Hoover

out

by

Commission

We must provide
our

defense,

token

non-essential
dollar

We

about

under

be

lives

is

just
Czar

all
It

in¬

an

The tax struc¬
shall

we

many

will

of

future.

of

Each

to

have

to

which

set up

It

gress.

intolerant

away

measure.

probably for
is to

be

cause.

are

terim tax
ture

Report.

contribution

Joseph's

seem

recent

expenditures.

frittered

another

the

generously for
by
the same

but

must

we

live,

to come,

years

by the next Con¬
help

of

to

could

shape

the

into

the

shape

our

far

us

well

form of government. It should be
the best tax measure which can
be

devised

facing

to

meet

the

probLems

us.

An Adequate Tax Plan Called For
Your

discussions

crystallize
spect

to

the

should

with

content

re-,

of

I believe there

measure.

that

are

some

nine important tax

or

mittees

here

ideas

many

com¬

associations

or

throughout

country,

each of which
important studies and

tributions in
most

its field.

constructive

has
con¬

One of the

things

that

could be done would be for all of

these

associations

to

form

an

inter-association board of strategy
which

would

represent the views

place these
views before the Secretary of the

with

as
as

the

preparation of the tax
Anything as important
this, anything as far reaching
this, anything which will touch

me

if

that
to

you

if

cut

the

won't

agree

government

these

domestic

level,

or

below, it

even

the lives of all of us, should
prepared only after the most
haustive

digested,
and

as

I've

said

before,

thoroughly
before

put

public in such

accepted
law-of
bill

and

the

got to tell

it

so

they've
in the only way
and

that government understands—by
word of mouth, by letter, but most
of

should

put

basis,

Next
us

and

all

keeping it
But

so

people.

Businessmen

have

into

the

a

pay-asmoney

burden

all activi¬

Because

this

the cost of

is everyone's burden.

most

important

of the

taxes.

The

is

the

foreign

policy of Russia has not changed

Federal Subsidiaries

with

that

year's tax

the

over

people.

is everyone's country,

amount

Restraint has to start

way

the

should be raised with

all, through the ballot box.

.

on

and

Business Must Stop Seeking
,

a

translated

land.

fairly distributed

want,

government

by sheer weight of logic it will be

ties

they

thoroughly
organized,

the

is

what

be
ex¬

study. The testimony to

be presented should be

you-go

course,

.

the government has to be told by
the people it represents that this

was

houses

own

the

to
or

less

could do it.

coun¬

it

been

in

budget, if it's not modified, would
send $3 billion on its way back

and the

wonder

war-time

some

republic, up
II, and

the

Agriculture

war

civilian expenditures down to the

during 1945 and 1946,
people individually or col¬
developed

expenditures.

at

to

wanted

mind

afterward

lectively

or

help.

to the start of World War

the

to

the

form

grams

as
"Housing
Development."

time

total

for my money,

known

the

to

seem

too small to worry

about $1,200,000,000.
Agricultural Depart¬
ment says it needs over
$2,600,000,000. Most of this increase is in

govern¬

all of the growth of this

try,

Some

thinking adjusted
where $50 million

the

1950

Of

Community

my

budgeted

Take that element in the Federal
and

so

that

measure.

In

frills,

my

$521

were

have

I

me

Treasury and the Committees of
Congress who will be charged

examples:
government

can¬

not

trimmed.

tell

the total of Federal

eight

areas,

government

sums

Agricultural

it.

as I
have said,
slightest doubt in

are

a

point

with

Now,

<

figures

get

things they

themselves.

of all the members and

Where Spending Can Be Reduced

not the

other

be

in

Before

or

Second, when the people make up
minds that they are going
have

we

sums

for

government's

their

ment

as

best

to

them

for

car figures, I didn't touch on
Agriculture at all. Agriculture has
always been a large part of the

they

to cut out these non-defense

such

do

better

The

able

that in time

me

do

box

forgive.

or

greater

1939.

will to do it.

could

the

own

later

or

off

a

governments

$5 million is small change.
But to get back a minute to the

public

a

ernment
can

local

and

stop letting the 1? ederal gov¬

made

to

kind

one

added

any¬

over

$40 billion budget.
I, for one, have never been able

penny

their

of

of

taxes

or

that

will

out

must

the

people

they get from the government
—in cash, in, public works, or
any
kind of so-called social
service,
comes

to

substantially reduced,

a

are

about in

things:

every

need

are

on

payrolls in their locali¬

State

large, from which,$50 to $100 mil¬

First, the people of the United
States have to want it done.
They
have to

the

of

urging

cease

government unneeded expan¬
create

lion

our

program.

require

to

alone

areas

facing, that these

There

mind

my

of

dollars

in

tell

can

if there is

eritirely work¬

an

practical

does

one

think the

question in

no

half

a

not be very

billion

serve

needs

billion

a

were

urgent

now

1945.

and

It

to

seemed

they

No

seriously whether it mightn't

very
be

to

than

needed

three

are

from

non-defense

billion

be

budgets today

billion

cutting

mean

has

less

no

will

urgent

where

it

Congress

that

assured

meet

What does this mean? Well, for

thing,

the

people.

do

World War II.

one

obligations to

with respect to aid in

$1,894,000,000

revenqe on those domestic civilian

expenditures

govern¬

waterways. In 1939, somehow
or other, the
government managed
to keep its people satisfied with
an
expenditure of $498 million.

of its

more

Federal

must

ties.

and

perhaps, but which
without, and

(3) it will not spend

Communication,"

the

development, air fields,
navigational aids for both air

and

have
do

can

"Trans¬

highway

go.

old

and

which

the people

(1) the government is not to
buy for us anything new we don't
clearly need and can't pay for as
we

to

heading in the

entitled

our

rearmament and

must

Chambers

contracts.

sion of Federal activities in order

But

amply clear to
that, except for

government

I

of Water and Land Resources Not

Years

United

Federal

many

on
the other hand,
subheading, and I quote,
"Conservation
and
Development

We resolve:

people

the

fairness

all

Businessmen

non-essential

will

is $1,845,-

purpose

sub¬

another for

or

seeking

grants

under the

which

framed to apply to others, and
not to himself.
Resolve

for

energy.

are

A

In

000,000.

go

same

Federal

kind

businesses.

stop

1939

budget included $228 million
for this purpose. In 1950 the budg¬

govern¬

Businessmen

seeking

afford

the

this spend¬
our

itself.

de¬

In

which

one

Commerce

the

the people have

point out that $673 million of this

462.50

Halliburt. Oil @ 30
Oct. 30
U. S. Steel... @ 38% Mar
3

exactly

the

by making and keeping
three simple resolutions.
as

reduced.

237.50

was

today

et for the

that

275.00

Housing"

whereas

government has always recognized

all-out-

an

before

gency gets worse, it is manageable
in size and we can pay the cost

475.00

@ 48% Nov. 20
Cities Service @ 77% Nov.
2

Barbara

Rosa

Over

paying back, al¬

in

be

heading is $1,027,000,000.

veloped

300.00

Richfield Oil.

Monterey—Oakland—Sacramento
Fresno—Santa

the

1-928

Private Wires to Principal Offices

San Francisco—Santa

of

Chrysler

<Associate)
Exchange

a

for the people.
We are not yet

Southern Pac. (g) 61% Nov. 15 $375.00

Exchange

York Curb Exchange

members

SPECIAL CALL OFFERINGS

Members
New

New

Street,

stop

must

are

take

can

that

out

Private

under

amount

little

a

we

we

the amount in the Federal

to

these

pockets

LOS ANGELES, Calif.—Samuel
Pedolsky has joined the staff of
Pledger & Co., Inc., 210 West

•

Schwabacher & Co.

is

and

point

should

when

than

more

only

to

either

Pledger & Co.

war

things which it has wanted to buy

A.

associated

I

I

whether all

this

time

a

public
housing

development.

argue

of

part

at

spending

though its policy has been one of
virtually
no
restraint
in
the

able

Clarence

become

with Francis I. duPont &

Securities

Pacific Coast Exchanges

credit

borrow

can

year

start

they

on

its

and that some year
income will be big

but that this is

(Special to The Financial Chronicle)

Seventh

Orders Executed

it

this

to

There is

(Special to The Financial Chronicle)

Pacific Coast

that

that

more

needs in

With Francis I. duPont

what

stopped

$14,000,000,

government

With R. H. Johnson & Co.
(Special tq The Financial Chronicle)

or

of

for

spent

going to

the

budget carried under the heading

this

probably be in the neighborhood
of not over $6.5 billion. But ac¬
tually the question might be asked

last

sugars.

think

to

be

In

government pro¬

community
not

the

19

busi¬

on

and
am

absent.

or

our

$1,329,000,000

to

"Aids

enough

this

produce for both. Among

week,

**

not

coincide

Reihmer

a

these

many

for

in.

spending from the
present proposed budget of $12.5

the

a war

matter

of the
Chronicle. They are presented as
those of the author only.]

bigger and bet¬

earnings to major produc¬

consumer

in

expressed

*

Generally speaking
market

views
do

going

no

broke

Federal

more
next,
perhaps its

the

suspicion.

already in
Stocks for short sales must
a
selling range > for some
weeks.
The
news
merely obviously come from the stock
brought the indications to a market listing. Short sales,
climax.
If that reasoning is unless engaged in by a pro¬
correct
then
the ■ break
in fessional, are dangerous.
these issues should represent

good

a

gone

our

unlimited,

panied by general weakness

were

have

seems

will

A.

is

forget

must

and that

nesses

the

*

stock.

in.

great,

years

For

jumping aboard.

J.

income

painlessly for all frills
how

Yet

According to the Dow the¬
still in a secondary
news
that credit restrictions reaction of a primary upward
trend. The rise to a new high
would go into effect.
#

national

to grow and grow and grow to
the point where it can be tapped

*

a

great deal on time payments,
suddenly went down on the

that

us

theory.
*

*

depend

that

companies

the

When

demon¬ swing back just as far, or al¬
of the most as far, in the opposite

amply

was

strated

mws

behaviorism.

market

stock

of figuring

difficulty

effect

the

money

cline.

By WALTER WHYTE=

The

vides

advance the

the higher their fact, Mr. Truman and his advisors
greater their de¬ wanted to shove it up still more.
The theorists who keep teiling
But that is a part of

small

was

1950

the contrary,

=

must

their

from

in

finds

sidies of

stocks will be invulnerable to

Walter

without fault in

spree

ment

*

*

*

Thursday, September 14, 1950

.

ing

steels and chemicals.

Tomorrow's

.

been

9

page

.

the

not

in

over

300

years,

from Ivan, to

Peter, to Catherine, to Alexander,

Volume 172

Number 4942

.

.

The Commercial and Financial Chronicle

.

(1019)

35

to

Nicholas,
to
Alexander,
to Continued, from
page 5
Nicholas, to Joseph, it has been
basically the same. It has been
continuous

a

of

and

expansion.

insistent policy

To

force

Industry

brute force—was added espionage
and

restriction

speech

in

means

to

20th

the

of

freedom

19th

Century

Russia's

Century

munism

as

ends.

they

added

worker in the lands

Czar

Joseph is

he has used

tools

Kipling

were

younger,

Adam-zad,

looks

like

the

Man."

a

when

wrote,

bad

Czar

taxes,

with

a

lets.

Red-ink

lot

less

trouble

than

in

red

a

to

extend

conversion

1951, but the converters

year

The

American

shying away
concludes

are

beyond the first half of the

Iron

year,

and

Institute

Steel

announced

this

week

making capacity for the entire industry will be 99.6% of capacity
for the week beginning Sept. 11, 1950, compared to
98% a week

bul¬

time,

rise of 1.6 points.

This
steel

in

week's

ingots

1,890,100 tons
the
a

Witt Loewi & Co.

rate

castings

week

a

for

entire

the

A month ago, based

ago.

1,921,000

industry,
on

tons

compared

of
to

capacity,

new

100.1% and production amounted to 1,930,600 tons;
based on the smaller capacity then prevailing, it stood

was

year ago,

at

operating rate is equivalent to

and

86.6% and 1,596,500 tons.

Electric Output Falls in Holiday Week

Roehm has become associated with
Loewi

&

Street,
Stock

Co.,

225

members

The amount of electrical energy distributed by the electric
light and power industry for the week ended Sept. 9, was esti¬
mated at 6,028,527,000 kwh., according to the Edison Electric

Mason

of

the

Midwest

He

Exchange.

associated with

East
was

formerly

Institute.

Dayton & Gernon

The Labor Day holiday resulting in the closing of plants and
businesses caused electric kilowatt consumption to decline the past

and Carter H. Harrison & Co.

week.

W. E. Hutton Co. Adds
W.

E.

Hutton

&

Co.,

Street, New York City,
of the New York Stock

that

announce

has

become

Robert

14

members

of the

Exchange,
E.

associated

It was 430,859,000 kwh. lower than the figure reported for the
previous week, 770,437,000 kwh., or 14.7% above the total output
for the week ended Sept. 10, 1949, and 862,401,000 kwh. in excess

Wall

output reported for the corresponding period two years ago.

Kenyon

with

registered representative. Mr.
Keynon was formerly with Bache

Loadings of
totaled 852,321

& Co.

Railroads,

as

a

(Special

to

cars,

1.7% above the preceding

cars, or

Auto

with Edward E. Mathews Co.,

Webber
Chronicle)

vehicle

motor

Ward's added

N.
Donnelly is now with Paine, Web¬
ber, Jackson & Curtis, 24 Federal
Street.
He
was
formerly with
Bond & Goodwin, Inc.

Automotive

the

Reports"

that shortages of basic materials such

Total

of screws, nuts and bolts

even

output for the current week

and

was

made up of

21,520 trucks built in the United States and

Lennon

*

121,375
total of

a

143 in the

Devonshire

201

Street.

He

E.

Mundo

W.

&

somewhat

were

failures continued

(Special to The Financial Chronicle)

W.

the other

All

Hog prices fell sharply from the high level of the previous
There was a moderate increase in
receipts and further
are expected in view
of; the unusually large spring pig
crop.
There was moderate activity in sheep and lambs with
prices remaining fairly steady.

E.

Henkle

E.

pany,

affiliated

Investment

group.

groups except

lines, but failures in manufacturing and

construction dipped below last

Ap-

Neb.—Howard

year's level.

Com¬

contrast to these

Federal Securities Building.

; With Waddell-Reed

casualties

increases from

(Special to The Financial Chronicle)

In

upswings, the Middle Atlantic States along with

the West North Central, South
fewer

10.3

million bales would be high in view of the unfavorable
re¬
ports of weevil damage and adverse weather.
A further increase
in cotton consumption as a result of
additional
military orders
could cause a sharp reduction in carryover stocks.

Trading in the Boston

wool market continued to be limited
past week reflecting the scarcity of offerings of most
types.
Prices rose appreciably following the
opening of the Australian

the

than

1949

in

the

appeared

Atlantic, and Pacific States, had

similar

week

in four

of

last

while

areas,

Food Price Index Eases in
There
food

American Sees. Adds
(Special to The Financial Chronicle)

Mild

year.

casualties

in

Humid

CHICAGO,
gren
can

111.—Amy

as

high of $6.69

C. Fahl-

moderate

a

a

week ago and $5.82

Street.

31

weeks.
The aggregate dollar
volume, however, was slightly above
that for the corresponding week in
1949, Dun & Bradstreet, Inc.,
reveals in its current
summary of trade.

apparel buying generally dipped last week,
vigorous
were reflected in
markedly increased demand for some
items; this was particularly true of furs and footwear.
Other,
less successful, promotions featured wool
jersey blouses and flan¬
promotions

nel suits for
women,

and haberdashery and worsted suits for

Housewives

less food

in

the

the

New

was

•

.

a

retired
stock
Cahn,
a 'former
member of

Exchange,
car crashed

York' Stock

killed

into

tree

when
on

his

the

Taconic

Parkway.




purchased slightly

previous

week; the dollar
above last year's level, however.

This

was

the first

'

.

t
r

the

fresh

The

volume

State

j

Wholesale
,

i n

After-reaching
Dun & Bradstreet

fractionally.

"1

a

two-year

high

food

was

men.

than

slightly

frozen

sale

as

varieties,

slightly in some com¬
juices increased somewhat,
dairy products purchased was nearly un¬

of

of

frozen

rose

fruit

Spending for house-furnishings declined moderately last
week,
many consumers balked at upward price
adjustments in

a

f+"

num¬

ber of items.

In

vicinities there

some

was

a

noticeable decline in the pur¬

chasing of vacuum cleaners, washing machines and similar house¬
hold appliances.
The previous level of furniture and floor-cover¬
ing buying was virtually maintained.
Interest in housewares
decreased markedly in some
localities, while in others it was
almost unchanged.
Total retail dollar volume in the
period ended on Wednesday
of last week was estimated to be from
3% to 7% above a year
ago.
Regional estimates varied from last year's level
New

South

>

by these

percentages:
England

0

to

Southwest

+1 to +5; East and Pacific Coast +3 to +7;
+4; Midwest +4 to +8; Northwest 4-5 to +9; and
+7 to +11.

the

observance of the Labor
Day week-end by many
businesses, order volume for the country during the week dipped
slightly from its high level of previous weeks. Total dollar vol¬
for wholesale orders continued to be
moderately above that
for the comparable period a year
ago.
The number of buyers in
attendance at various wholesale centers fell somewhat
the past
week.
ume

Federal

Reserve

on a

Board's

country-wide basis,

index

for

the

week

taken from

as

ended

Sept. 2,

1950, rose 5% from the like period

of

14%

previous week from that of

(revised)

was recorded for the

last year.

An increase of
a

For the four weeks ended Sept. 2, 1950, sales showed a
rise of 14% from the
corresponding period a year ago and for the
year ago.

to date registered

Retail

trade

in

an

New

advance of 4%.
York

last week held active under the
stimulus of increased purchases of seasonal apparel and accessories.

According to the Federal Reserve Board's index, department^ *»,
sales in -lev; York City for the
weekly period to Sept. 2<V*

.

1950, declined 2% from the like period of last

Fractional Declines

,

for

past week

store
yy

Commodity Price Index Marked by

di

the

and

changed.,;

year

j

-

volume

the

Interest in canned goods receded
somewhat, as many shoppers
preferred fresh fruit and vegetables.
The demand for meat, of

eral trend of food prices at the wholesale level.
ir„

G.
and

year ago.

foods in general use and its chief function is to show the gen¬

^

Joel

a

with the two-year

The index represents the sum total of the price per pound of

J. G. Cahn
broker

drop of four cents in the wholesale

of Sept. 5 stood at $6.65 compared

Moderately in Holiday Week

combined

Department store sales

decline in the past twelve weeks.

has joined the staff of Ameri¬
Securities
Corp., Ill West

Monroe

weather

with the Labor Day week-end
brought retail spending in the period ended on
Wednesday of last
week to a point
moderately below the fairly high level of recent

the

Holiday Week

price index last week, according to Dun & Bradstreet, Inc.

The index

*

was

to 50% above

closing.

Trade Volume Declines

-

Reed, Inc., Kansas City.

qjj

Buying generally

range.

more active than in the
preceding week.
There was some
expectation that the first estimate of the season's cotton
crop at

the Mountain States remained unchanged.

O'NEILL, Neb.—Esther C. Har¬
ris is connected with Waddell &

narrow

a

was

With

Five geographic regions reported an increase in failures.

with

•

Spot cotton prices moved up at the close of the week after

fluctuating irregularly within

in

in both trade and service

(Special to The Financial Chronicle)

become

slightly
On

manufacturing had mild
mortality.
Contrary to this general uptrend, manu¬
facturing failures declined. More casualties occurred than in 1949

With E. E. Henkle Co.

has

rose

year ago.

less numerous than last year when

liability

industry and trade

increases

LINCOLN,

were

37 businesses failed in this

Building.

a

hand, small failures, those having liabilities under $5,000,

dipped to 32 from 34 and

Co., Jackson City Batik/& Trust

lancl

be

109 and exceeded the 111 of this size

to 113 from

Haischer is with H. H. Butterfield

Co.

to

Casualties involving liabilities of $5,000 or more

Mich.—James

While

a

low; they fell 31% below the 209 which
reported in the similar week of 1939.

were

Joins Butterfield Co.

&

than

numerous

that year's

Co.

JACKSON,

less

year ago when
occurred, they remained well above the 1948 total of 83 in
comparable week. In comparison with prewar levels,

was

148

with

formerly

preceding week, Dun & Bradstreet, Inc., reports.

casualties

in both British West Africa and

week.

shortened week ended Sept. 7 and changed only slightly from the

with Lyman Phillips & Company,

cocoa

are

while

Commercial and. industrial failures totaled 145 in the holiday-

J.

associated

become

expected slight
the long holiday

an

to

increases

both

•

Business Failures Hold at Low Level

Mass.—Thomas

has

prior

anticipated this year.
While the demand for refined
unusually heavy buying, it was sustained by
the seasonal orders of the
canning industry.

(Special to The Financial Chronicle)

BOSTON,

week

sugar did not reflect

munities.

2,004 trucks built in Canada.

cars and

Phillips

the

of

end

Spot prices continued

Increased production of

Nigeria

steel,

as

continue to hinder production.

cars

appreciable buying beyond September.

While

week,

past

in

production

virtually all nonferrous metal, and

5,443

Joins Lyman

"Ward's

to

the United States and
Canada of 150,342 units, compared with the previous week's total
of 188,072 (revised) units and 123,806 units a year ago.

Mass.—Charles

; BOSTON,

or

Output Turns Downward in Labor Day Week

combined

to The Financial

cars,

in 1949, but a decrease of
4.8%, under the comparable period of 1948.

According

Joins Paine,

148,387

above the corresponding week
cars, or

53 State Street.

(Special

increase of

an

42,810

F.

McNamara and Leonard H. Morse
are

represented

21.1%

Mass.—Richard

slightly

virtually unchanged.
An in¬
crease in cocoa prices
occurred last week; trading volume was
slightly slower than in previous weeks.

freight for the week ended Sept. 2, 1950,
according to the Association of American

The week's total

Chronicle)

Financial

The

BOSTON,

the

toward

last June's

week.

Two With Mathews

no

Trading in coffee remained steady with
decline

>

reflecting the effort
protect against rising prices.
Buying was not
were limited largely to immediate

to

nearby needs with

week-end.

to

revenue

increase of 13,892

an

mills

some

steady

were

increase in flour buying

some

auctions where prices were
reported to be from 35%

Carloadings Rise Moderately in Latest Week

them

of

was

Cattle receipts this week were
among the largest recorded so
far this year; prices were
steady to slightly below last week's levels
with the demand generally down somewhat.

(Special to The Financial Chronicle)

Wis. —Linus T.

There

deals

that the operating rate of steel companies having 94% of the steel-

the U. S. A.

; MILWAUKEE,

demand for most grains.

or

like

"The Iron Age."

off

here

government

will take most of the first

carryovers

would

consumers

through the entire

ago, or a

means

big

from any commitments

Joseph

spending,

sold out for the rest of the year

particularly active; bookings

Some

that

us

now

*

While there was considerable activity in wheat on the
futures
market, the demand for cash wheat remained slow as did the cash

They indicate these
quarter output.

improperly

placed and used, will kill

extending

Closing prices for grains generally
higher than in the preceding week.

overs.

we

Bear

continue

They have closed their books to all but
defense orders.
Some companies have enough orders on their
books to operate at capacity for the next six months.
Some are
holding first quarter 1951 open to clean up fourth quarter carry¬

truce

no

to

nearly all products.

changed

"There is

with

knows

on

further

to

expected

Most steel companies are

Com¬
inside

just smarter and

more

since

a

the

they coveted.

his ends. Times have not

is

this record of sus¬
tained operation,
although the strain becomes greater with each
passing week;

different than

no

Czar Ivan. He is

as

In

insidious

an

industry

of

on Sept. 5 as compared with 286.38 a week
ago and 242.22
corresponding time last year.
Moderate price increases in grain futures accompanied a rise
in trading during the past week.
With the harvesting of wheat
now
progressing in many of the important producing areas, addi¬
tional receipts are anticipated.

at the

The State of Trade and

plain

—

286.58

at

the

ceding week
end

of

August,

the

daily wholesale commodity price index dipped

It remained very close to the recent peak closing at

of

9%

1949.
was

a

rise of 9%

was

year.

In the

For the four weeks ended

Sept. 2, 1950,

an

noted and for the year to date volume showed

from the like

period of last

pre- ,:

registered from the1 similar week

year.

increase of
no

change

Financial Chronicle

The Commercial and

36

of

Continued

from first page

For the
peacetimes when we did not ask
to work

them

hard

so

to pro¬

nor

Heavier taxes mean
financial
incentive
to

duce so much.

the

that

produce

the take-home pay —
So
we
must
obtain

—

diminshes.

while we
less for it. How is that miracle

maximum
pay

production

accomplished?

to be

The

first

solving

in

step

any

problem is to get the facts; to or¬
ganize and
analyze them;
and
then to use one's experience and
judgment to work out as intelli¬
gent

answer

an

possible. You

as

perhaps the best group in the

are

country to do the job of marshall¬

ing the tax resources of the coun¬

surely going to
do it. Apparently the

try, and you
be asked to

is

and

out

the

be

several

next

that Act

and

studied

be

will

1951

the

for

charter

years;

of

Act

Revenue
tax

are

going

to

this

drafted

fall.

What

(1)

is

confront? Is it
War

fiscal

same

We

out

that

II

are

fight

to

it?

involved in
and

area,

committed

naval

Korea is
to

the

all-

an

The present hostilities are

not

and

use

should

weapons

in

limited
have

we

much like World

so
we

not yet

war.

situation

the

forces

far

so

we

great armies
the

to

battle.

valuable warning to us

a

get ready for another war that

in some other
place, to strengthen our forces
with a view thereby to preventing
an attack that is more apt to be
directed
against an unprepared
and weak nation than against one
break

may

that

is

out

for

that

forces
Who would be so bold

assure

the

1951,

five

next

decade?

cold

world

next

that

a

would

all

and

could

that

be

the

the

wars

wars

and

us

in

all wish

hot

of

will

in

we

and

confidence

war

1952,

years,

v/ars

behind

of

in

Surety

other kinds

better

with

us

menace

in

ended

and

up

military

strong

years.

to

as

have to build

may

maintain

be put
and

new

dawn.

Pru¬

dence counsels,
make

however, that we
fiscal
plans
on
the

our

basis

that

this

country and

haps the world
camp

for

come,

and that

number

a

we

the costs in

pay

1 for

be

may

of

years

to

have

may

very

per¬

armed

an

to

heavy taxes

many years.

Our

fiscal planning, then must
long-range. We cannot stop our
planning with a tax program just

1951, 1952,

nor

for 1953.

Since

the

projected tax program must
produce much more revenue than
peacetime levies, even after we
-affect

all

the

economies

we

can

in government and in civilian ex¬

penditures, and since we must be
particularly careful not to dis¬
courage

win

out

wars

essential

the

that

will

for us, it is particularly
the
revenue
pro¬

that

conform

gram

goods

high

to

of tax fairness. This is
facile solutions of

our

standards

no

time for

fiscal

prob¬

lems.
Present Fiscal

.

Thursday, September 14, 1950

.

these
The

fiscal
United

■much

more

years

lishment.
may

have

States
money

on

(2)
to

must

in

spend

the

next

the military estab¬

The

United

continue

States

such

ex¬

penditures for several years, per¬

haps indefinitely. (3) We are not
yet required to pay for all-out
war, but we may yet have to pay
for
it,
possibly after years of

heavy military expenditures.

billion, including $1 bil¬
of an additional appro¬

about $5

out

lion

priation for military aid. The war
boom and our foreign purchases

situation ERP
was
designed to cope with. All
other
expenditures
were
esti¬
mated in January at $24.2 billion.
If these latter expenditures could
be reduced to the level of fiscal
1948, not a year of abnormal econ¬
omy, we would spend $18 billion
in a full year, a saving of $6.2

should alleviate the

1951, we can still reduce

In fiscal

expenditures to $21 billion,
if we did, the result would

such

and
be

a

Federal

budget

expendi¬

tures,

particularly the ordinary
civilian expenditures in the budg¬
et, to put the budget in the best
shape for the

possible




emergen¬

Senator

told

Byrd

literally, for
would be too

accurately

it

required

than

more

the

with

therefore,

start,

proposition that we have not yet
devised a satisfactory way to dis¬

from fair

excess profits
reasonable profits.

tinguish
and

the

fiscal

sound

From

management.

point of view, we will gain

every

a nation by trimming
particularly non-essen¬
civilian expenditures, down to

greatly

as

tial

figure

surety pay for.

we can

We

Should

Excess

An

Have

Profits Tax?

Until

we

place—should we prompt¬

profits

enact an excess
The
question
is

profits

shall

we

but

tax,

in January.

tax?
realty

increase

Revenues are bound to

the
estimates because of the

it is not

ar¬

ductivity,

January

ing the profit out of war.

high

activity,

business

least

three-fourths of
so that at

about

to

fiscal

1951,

year

billion

$3

1950

the

1950 increases

Bill. The

Revenue

of
the

level
well as

in

made

increases

tax

as

of new revenue
if that bill is put
January estimate

will be produced

The

force.

in

of total

receipts

$37.3 billion.

was

$43 billion seems now a conserva¬
tive estimate of the actual reveis

1951

billion or

likely to be $2

rather than the originally
forecast $5.1 billion. We are not
confronted,
then, with
an
im¬
less,

fiscal

mediate

emergency.

1952, military expendi¬

In fiscal
tures
ance

will

military assist¬

and foreign

further,

increase

per¬

haps to about $30 billion. The cost
of our international finance and

should further
to perhaps $2

program

recovery

decline,

however,
all

If

other

expenditures

held to the 1948 level, $18 bil¬

are

lion,

have

we

budget

of

$50

from taxes

total Federal
billion. Revenues

now

a

in the books

can

bil¬
lion, with the high levels of busi¬

be

to

expected

$47

produce

activity bound to accompany

ness

preparations.

war

fiscal
about $3 billion.

then,

deficit,
be

The

1952

for

would

in

not

substantial

for

taxes
go,

immediately

we

to

en¬

but the
involved

into

go

there

an

is

armed camp
every

reason

trimming off the fat from cur¬
domestic
civilian
expendi¬

rent

tures.

If

level

expenditures

other

than

cut

we

could

program
can

on

1948

functions

defense
and

and

finance,

$6 billion from

1950, estimates. That

is really a
certainty cut

example,

the

to

for

affairs

save over

the. January,

We

back

national

international
we

gages

by

Mortgage
out

some

minimum.
for

down,

acquisitions of mort¬

the

of its

National

Federal

Association.

If

holdings,

billion, there could be
money

vincing, to

a

fairer than

skim off

to

exces¬

profits, particularly in

war¬

give them to the gov¬

time, and

the

how

in

businesses

the

particularly,
rule

will

the

can

all

of

cases

different

fairly

More

country?

hard

law that

fair

distinguish

fast

and

be enacted into

can

Com¬
profits

fair
the

what

fair

over

excess

determine

missioner
in

the

And

profits.

excessive profits?

are

from

unfair

profits in the case of a
railroad, a magazine, a soft-drink,
a
new
business that just started,
old

an

that

one

has

been

ticking

along for years?
in

Bear

of

will

tax

take

away

under the

income, and
45%

1950 law,
income is al¬

corporate

ready earmarked for the Govern¬
ment.

the

Surety

be

the

to

itself

for

take

excess

an

which
already

money

has

Government

elected

cannot

So the

profit.

a

it

becomes,

ques¬

sold

over

$1

flow of

into the Treasury instead

how

should

added

be

Government's share?

the

to

Would it be

simpler and better simply to
crease

further the

rate

of tax

in¬
on

corporate income?
Our

the

previous experiences with

excess

been

drawn

profits

tax

have

not

happy.
The tax has
been found to operate so badly
that we have hastened to repeal
very

it at the end of the
last

law, we
earnings for

war.

In

the

(1) average
base period and

used
a

(2) a percentage of permissible
earnings on invested capital, as
of

measures

during the next few

fair

return.

Both

yardsticks had to be used, for one
fairly, and that
to the complexity and ob¬

dollar figures of

the gross national

product and of personal income in
the past decade.
The gross na¬
tional product stood at $91.3 bil¬
lion in 1939.
It was $215 billion
in 1945.
The current annual rate
$270 billion. Personal income
$72.6 billion in 1939; $172
billion in 1945; it is now running
of

rate

the

at

We

not

abate

are

billion per
obviously on the
$215

and the war

wul

it.

receipts have
along with the
We had Federal expendi¬
of $9 billion in 1939.
We

Federal taxes and
than

more

under actual direct

attack,

could

we

than

doubtless

bear

Federal tax exactions

more severe

have yet known.

we

Conclusion
In

conclusion,

if

(1)

Congress

will control non-essential

military

expenditures,
tures

be

in

now

civilian

expendi¬

contemplation
substantial

without

met

increases.

Even if this

(2)

can

tax

coun¬

try becomes an armed camp, and
military expenditures rise consid¬
with

balanced

than

budget

the

erably,

can

carried in 1945.

we

still

be
taxes

greater

no

On that

basis, however, exemptions must
be lower and rates must be

confront today.

we

need to call

on

higher

We will

nearly all the tax¬

capacity of all our income-

(3)

producing citizens.
III

War

pass,

is

impossible to
stringent the tax

It

further.

how

forecast

If World
the Jax

be tightened

will have to

screws

still

to

comes

system will have to be; but it
than any we

it

will

stringent

more

have yet known, for
our survival as a
life and death world

insure

must

in

nation

far

be

doubt

no

a

which we will have to
finance. No sacrifice of lives or of
fortunes will then be too great.
Like the military, we confront
struggle,

a

challenge to

our

our

learning and

We have a little

experience.

first
problem—to balance
the budget required for the Ko¬
rean War.
The first requirement
while, not long, to solve the
stage of our

is

to

cut

expenditures, especially
to the es¬

expenditures,

civilian

make

gone

to

that the
value

for every
not

sure

dollar spent; that we are

frills and

wasting billions on

second require¬
ment is to design the very heavy
Federal taxes which we must pay
The

foolishness.

for

the

tribute

of our lives; to

rest

tax

the

load

among

dis¬
our

businesses so
fairly that incentives to work
spent $40 billion in 1949 and $40
hard and to produce mightily will
billion in 1950.
The relation of
Federal taxes to gross national not be unduly discouraged.
It is just possible that we can
product was 5.6% in 1939 and
trend.
tures

13.7% in 1950.
Federal
the

and

people

our

insure world peace

budget receipts

reached

of $45 billion in fiscal
Since that time, consumer

peak

our

by developing

1 strength, fiscal, military and

productive, now. Our task in the
increased 32%. Ap¬ fiscal field is fundamental, for we
plying that percentage to 1945 make productive and military ac¬
budget
receipts, $45 billion in
complishment possible.
Here is
1945 becomes $59 billion in 1950.
In
other words, $59
billion of the greatest challenge we tax ad¬
Federal revenues would be re¬ visers have ever faced.
quired to buy today the same
amount of consumption goods that
With Mann & Gould
$45 billion bought in 1945.
(Special to The Financial Chronicle)
Wholesale prices have increased
SALEM, Mass.—Harry D. Wil¬
48%. A 48% increase in the 1945
budget of $45 billion would give kinson, is associated with Mann
&
Gould, 70 Washington Street,
$66 billion.
Total personal income has in¬ members of the Boston Stock Ex¬
creased 27%
since 1945.
Gross change.
national
product has increased
With F. I. du Pont Co.
26%. An increase of 27% in the
1945 budget total would bring a
(Special to The Financial Chronicle)
total of $57 billion.
An increase
CLEVELAND, Ohio—Roderic D.
of 26% would total $56 billion.
O'Connor is now associated with
1945.

Budget
were

ures

We found that
of new businesses,
brought out a

in fiscal

1950

from 26 to 48% higher
1945.
On the basis of

for

25% rise, total receipts of
$56 billion today would be the
rough equivalent of the heaviest
wartime
tax
burden.
Im other
only

War

a range of not
billion between the tax

we*nave
we

peak

are

tax

now

bearing and

burden

of

World

II.

that began to earn
We were able to pay $45 bil¬
after the base period; businesses^
lion into the Federal Treasury in
which were depressed in the base
1945.
By the same token,
we
period—neither foot rule worked could
pay
at least $56 billion
fairly. So Congress enacted broad
now, if we had to do so.
To be
relief provisions.
The latest one sure, $45 billion of Federal budget
Street Journal."

du

with

reau

Avenue.

Pont & Co., 1010
He was formerly

Webber, Jackson &
Cleveland, and with Car& Co. in New York City.
Paine,

a

product

"Wall

I.

Curtis,

cited range

than

Francis
Euclid

burden

which

receipts

$37 billion.
The dollar fig¬
for the economy which I have

the

to

the

States

United

Government is getting full

in

Letter

now

contemplated.

sentials;

scurity of the law.

*

mo¬

mobilization than is
Indeed, were

larger

was

words,

new

a

is

quite $20

cases

Coming

(4) We are| all familiar with
the tremendous increase
in the

added

many

months.

Revenue

Tax

More

alone did not work

businesses

sheep from

to separate

to

goats,

by

prices have

mind, too, that an ex¬

profits

cess

profits

excess

Can we best stop them

crest of a boom,

But what

Presumably

excess

by renegotiation or by taxation?
If the latter, how should the law
be

could

we

strong

able

we

that

seems

budget required

than

year.

ernment?

expenditures and

great.

economy,

for

like

to pay as we

us

in peacetime. Its
appealing, even con¬
layman. What could

is very

sive

ended. We have

it

used

name

be

and repealed

wars,

wars

never

income

the

phenomenal
these. We

of

additional

some

As

need

a

civilian

in

cuts

for

times

activity,

confront

used it in two

have

We

record?

much of the
remaining 55% of total corporate

Budget Should Be Balanced

business

the

on

it when the

tion

We should certainty balance

budget

profits tax

How does the excess
stand

the deficit for fiscal

/.Hence

nues.

the necessity of tak¬

as

it

the Federal

experience and technique. Can
devise a base which will be

much its revenue pro¬

so

during the current year above
extraordinarily

familiar with

least
tax

for

advanced

popularly

gument

of

permit American busi¬
ness to function as
vigorously as
not
have an excess it must? The endeavor to devise
an
excess
profits tax that will
how soon; and
base for deter¬ work demands our best thought

ly

whether

problem

profits taxation is, then, a major
challenge to this group. We are at

profiteers.

(3) We come now to the ques¬
tion most under discussion in the
market

Hence,

1944-

years

Federal receipts
than $40 billion.

less

meet for several years

fair, which will not be impossibly
complicated in operation?
None
of us
wants to encourage war

the budget,

a

whole

The

in

leadership

of

lack

singular

inclusive,
never

bilization of armed forces, a much

mortal skill.
We

year,

on

us,

against what will be the
$42.4 billion budget proposed mining excessive profits? The

(

current

have

would

1948,
were

do, we must have grave misgiv¬

billions of dollars.

$45 billion budget, as

(4)

1 There is every reason, therefore,
for trimming the fat off of the

estimates.

billion over the January

amounts

Situation

situation, then, has
characteristics:
(1)

cut

we

apply

To

great.

the
not

it

applied

be

the loss of revenue

but for the five

that

could

broad

so

—

are

few

more

able

The present

hold the line, or better,
back, the budget saves

merely
if

possibly

at this time; nor

expansions of existing programs,
such as rivers and harbors. If we

was

concluded

Bureau

July ings about using an admittedly
(2) No August or September 31, that we could cut the budget imperfect tax to collect a great
budget revisions have
yet ap¬ requests for 1951 by $9 billion or amount of money. We know that
such a tax has damaged promising
peared. Nevertheless it appears $10 billion, without encroaching
businesses severely; and, on the
likely that national defense or at all on military expenditures.*
military expenditures,
budgeted There is one of our greatest fis¬ other hand, has encouraged waste¬
expenditures by established
cal resources
to balance the ful
in January at $13.5 billion, will
Nevertheless, experi¬
run
about $19 or $20 billion for budget by refusing to spend so businesses.
the current fiscal year. Expendi¬ prodigally for non-essentials. We ence shows that we are almost
have hardly begun to think along certain to have a war profits or
tures for international affairs and
finance may be expected to total these lines, and we have had a excess profits tax in wartime.
much

by taxation the incentives

turn

social

undertake new

not

welfare programs

probably going to need
tax revenue later.

ish. We are

billion.

be

for

Emergency

(5) It would be
wise not to exhaust our tax am¬
munition in this the first skirm¬

apply

strong and ready.

should

these

of of

Expenditures

outgo.

surpluses to shortages. Surety we

cies of the future.

the

We

net

a

public funds to hold up agricul¬
tural prices (budgeted at over $1
billion for 1951) are unnecessary,
as
our
condition
changes from

Out Fiscal Resources

to

.

(1020)

receipts were realized only in one

Two With Gottron,
(Special to The Financial

Russell

Chronicle)

J.
Zabel,
Jr.
have become affiliated with
Gottron,
Russell & Co., Union
Commerce Building, members of
the Midwest Stock Exchange.
CLEVELAND, Ohio—Samuel

Minichiello and William P.

Kidder, Peabody Adds
(Special to The Financtal

Chronicle)

BOSTON, Mas s.—F
Sanders is now with

body & Co., 115

ranklin

Kidder, Pea-

Devonshire Street.

37

(1021)

The

Indications of Current
Business Activity
AMERICAN

IRON

Indicated

steel

AND

ingots

caDacitv)

of

AMERICAN
Crude

castings

and

Gasoline

(net

Sept. 17

—

daily

(bbls

average

of

Kerosene output

qpnf

9
o

~

.

distillate
oil

9

Sent

"fipnt

(bbls.)

and

98.0

100.1

1,921,000

1,890,100

1,930,600

%

fuel

oil output (bbls.)
(bbls.>__
at refineries, at bulk
terminals, in transit and in pipe
Finished and unfinished
gasoline (bbls.) at_
Kerosene
(bbls.)
at
Gas, oil, and
pistillate fuel oil (bbls.) at
Residual fuel oil (bbls.) at___

Sent

__

9

aept. 2

output

Sent

9

Snt

o

Sent

2

\

freight

loaded' (number

CIVIL

received from

Benzol

5,759,630

5,699,480

5,640;350

1:6,109,000

4,813.350

6,197,000

5,944,000

5,233,000

20,171,000

20,263,000

19,783,000

2,310,000

2,272,000

2,055,000

7,825,000

7,559,000

7,419,000

Crude

6,724,000

8,543,000

8,079,000

105,793,000
24,829,000

108,895,000

65,841,000

62,235,000

41,697,000

41,791.000

67,997,000

ENGINEERING

RECORD:

Total

cars)

o„nf

CONSTRUCTION

—

ENGINEERING
•.

L_L__

construction

J,

9

(number" o~f cars )II~sept!

-

S.

u.

of

837,218

702,259

-

construction

Public

construction

OUTPUT

Bituminous

(U.

S.
and

coal

lignite

STORE

TEM—1935-89

OF

output

(tons)

000

Sept

88,400,000

Nonresidential

97,357,000

67,061,000

48,984,000

9,488,000

9,157.000

RESERVE

(per

'10,980,000

10,875,000

959,000

962.000

888,000

143300

*143,800

2

16

271

89

83

71

114

118

89

35
79

32
86

.27
62

127

124

111

37

35

33

26

24

29

30

19

24

23

24

11

12

__

147,000

nonresidential

Religious

310

*288

10.900

296

Bcrap steel (per

METAL

PRICES

(E.

DUN

&

9

6,028,527

and

6,253,141

5,258,090

143

194

148

Other

145

and

Lead

(New

Lead
Zinc

(New

3.837c

3.837c

3.705c

York)

(St.,Louis)
(East

St.

5

$46.61

$43.61

$46.61

$45.88

Hospital

5'

$40.58

$40.92

$39.17

$22.92

Sept.
Sept.
Sept.
-—Sept.

at

at

U.

S.

BOND

at

PRICES

DAILY

17.325c
17.550c

All

99.750c

98.500c
12.000c

15.125c

14.800c

13.800c

11.800c

16.500c

15.000c

COKE

14.925c

15.000c

10.015c

101.68

102.04

102.03

103.84

116.02

115.22

116.02

other

120.84

120.84

Oven

OF

11

42

.

-42

11

*11

15

*270

275

54

55

enterprises.
development.

19

*19

23

94

*94

80

8

8

9

6,364,054
5,854,975

1__

MINES)—Month

119.41

119.41

119.41

115.43

115.63

115.43

OF

109.42

109.24

108.70

112.00

111.44

109.60

116.41

116.61

117.00

116.22

Sept. 12

119.61

Total

106.39

112.19

120.02

119.61

119.61

*6,995

5.010

*3,790

2,610

3,350

*3,205

2.23

.d-

Charge

23,300

RE¬

short-term

31:

—

^

-

credit

2.85

2 85

?.°n

2.63

2.61

2.61

2.60

2.69

2.68

2.68

2.88

2.87

2.88

2.95

Baa

Sept. 12

3.20

3.21

3.24

3.37

Railroad

Sent. 12

3.05

3.06

3.09

3.19

Sept. 12

2.83

2.82

2.80

2.84

Deliveries

Sept. 12

2.67

2.65

2.67

2.67

Backlog of orders at

2,400
4,325

*7,572

6,863

*3,392

3,123

3,193

*3.147

2.768

1,019

*1,033

972

2.68

Sept. 12

>

5,113

7,7^2

—

—...

Sept. 12

9,335

3,520

...

accounts

Sept. 12

$16,198

5,264

...

credit

Sept. 12

Aaa

A

2.84

2.35

*12,108

3,994

FEDERAL

Aug.

credit

Other
Loan

2.35

*$19,680

7,344

of

credit

Noninstalment
2 37

1,906,400

Automobile

AVERAGES:

Sept. 12

723,671

$20,340

THE

Estimated

as

credit

consumer

Sale

OF
—

millions

Instalment

(net tons)

4,926,300

OUTSTANDING—BOARD

SYSTEM

in

114.08

Sept. 12

CREDIT

of month

4,949,600

5,657,494
*567,530

815,968

tons)

*6,225,024

509,079

12,608

(net

GOVERNORS

credit

July:

(net tons)..

coke

SERVE

of

tons)

(net

coke

CONSUMER

121.04

119.20

Sept. 12

*.

Single
Service

MOODY'S

476.2

469.9

Sept.

317,217

211,075

p|"

Sept. 12

INDEX

COMMODITY

CAN
of

449.0

RAILWAY

334,123

228,119

219,000

193,515

100

100

98

89

-Sept.

729,058

(tons)

of activity

Unfilled

at

orders (tons)

—-—

645,496

AND

PAINT

DRUG

PRICE INDEX-

REPORTER

.Sept.

ETOCK

FOR THE ODD-LOT ACCOUNT

TRANSACTIONS

LOT

SPECIALISTS

AND

DEALERS

EXCHANGE—SECURITIES

THE

N.

Number

637,177

365,609

PRICES

of

shares—Customers'

total

Customers'

short
other

sales

total

26,210

24,254

35,956

13,608

787,256

73MOO

1,096,323

386,415

Aug. 26

$34,170,449

$32,232,118

$44,778,927

$14,970,710

Aug. 26

26,575

25,672

31,685

16,197

Aug. 26

223

138

256

Gold

161

16,036

tCadmium

8.657

4,855

10,001

6,510

tCadmium
SCadmium

sales

Aug. 26

756,615

724,850

932,884

418,149

Aug. 26

$29,381,396

$27,433,501

$34,540,019

$13,991,111

Number

sales by

Short

sales

Aug. 26

r_

sales

Aug

223,030

242,330

173,960

26
267,270

223~ 030

242,830

173,960

Aug. 26

purchases by dealers—

258,960

271,430

424,110

NEW

PRICES

SERIES

—

U.

S.

DEPT.

OF

Farm

products
Fuel'and lighting
and

than

farm

and

Chemicals
•Revised

162.8

168.6

154.6

5

239.6

249.4

241.6

5

177.1

176.5

174.7

161.3

5

260.G

263.8

255.3

226.8

Sept.

foods

and

5

156.3

*155.4

154.5

143JD

5

152.4

*149.6

147.9

139,4

Net
Net

figure,

,

products

153.3

(per

.

134.1

129.5

174.5

174.8

173.9

*216.1

212.7

187.9'

Sept.

5

125.3

124.0

120.8

119.8

134.7

134.5

(E.

8n."i5c

102.000c

$35,000

end

41.730c

24.500c

38.500c
39.000c
Nominal

25.000c

Nominal

$75,189

pound)

$72,080

$69,000

$2.15000
$2.22500

!

$2.15000
$2.22500

$2.00000
$2.07500

$2.30000

Not avail.

17.500c

17.000c

21.940c

20.500c

48.000c

40.000c

22.500c

48.000c

-

(BUREAU

$2.15000

$1.80000

17.500c

pound)

$2.30000

$1.80000

-

from

$74,556

27.780c

24.648c
25.148c
Nominal

OF MINES)—

(bbls.)

(at

$35,000

$73,440

27.928c

& M. J.)

$35,000

$78,000

i

ounce)

(per

20,709,000

mills
of

18,856,000

24,749,000

19,321,000 -

12,840.000

(bbls.)

20,007,000

23,167,000

(bbls.)

month)

15,302,000

94%

93%

19,313.000
87%

$771,660,954
578,610,150

$779,182,389

$700,207,526

used
EARNINGS —CLASS

(ASSOCIATION

OF

I

ROADS

AMERICAN

RRS.)—

Total
.

operating

revenues—

Total

operating

expenses

"Operating
Taxes

168.0

238.2

103.000c

Month of July:

208.6

5

5

price)

T

RAILROAD

'

5

fllncludes 519,000 barrels of foreign crude runs.




165.6

Sept.

Sept.

products

allied

167.2

Sept.

materials

metal

materials

Building

177.5

167.7

Sept.

other

Textile

Metals

179.5

168.2

Sept.

Meats

commodities

179.4

5

Sept.
Sept.

—-—

Foods.

All

167.5

5

Sept.

,

Livestock

t

5

Sept.

,r

—

S.

pound)(per pound)

Production

Stocks

Sept.

products

Grains

U.

97%

Capacity

All commodities

10.000c

89.715c

10J..l°4c

min

99%

ounce

PORTLAND CEMENT
Month of July:

192G—100:

43.727d
$4.02522

15.000c

102.194c

**Nickel

LABOR—

63,500d
$2.80000

15.052c

straits

(per

Shipment
WHOLESALE

63.500d
$2.80000

Louis

Aluminum, 99% plus, ingot (per
Magnesium, ingot (per pound)-.-

127,720

„

of shares

Number

267,270

Aug. 26

sales

Other

Round-lot

Cobalt,,

dealers—

shares—Total

of

71,891c

(per

Platinum,

424,659

other

72.750c

refined

31,429
942,885

Customers'

14.791c

72.750c

pound), bulk, Laredo
pound), in cases, Laredo
Antimony (per pound), Chinese Spot

25,534

Aug. 26

11.660c
11.460c

(per

729,705

sales

Round-lot

15.032c

12.926c

Antimony

26,352

value

17.325c
17.551c

12.726c

(per pound)

HAntimony

765,272

short

Dollar

22.200c
22.425c

York

pound)—East St.

York,

(per

Aug. 26

Customers'

.

Louis—

St.

Voik

Antimony

sales

22.272c
22.499c

QUOTATIONS)—

(per pound)—

——Aug. 26

total

7,178

28,731

of August:

Quicksilver (per flask of 76 pounds)

sales)—

sales

—

shares—Customers'

of

Tin

(per

§§New

sales

Customers'
Number

Zinc

Aug 26
Aug. 26

J.

M.

&

Silver.pmd Sterling Exchange—
..;.Silver, New York (per ounce)..—
Silver London (pence per ounce)..
Sterling Exchange (Check)____

New

:—

orders—Customers'

of

7

OF ODDSTOCK

sales

purchases by dealers (customers'

Number

129.2

COMMISSION:

EXCHANGE

value

Odd-lot

128.1

(E.

for Month

.Common;-'' New

Y.

of orders

Number

Dollar

132.2

134.2

3.464

67,084

(number
-

Electrolytic domestic refinery
Electrolytic escort refinery..
(per pound)r—

dealers (customers' purchases)—

sales by

Odd-lot

ON

8

5,203

86,156

____

of month

Lead

-1926-36

AVERAGE=1()()

end

cars)

Common,

OIL,

cars)

Copper (per pound)—

262,601

229,360

—Sept.

(tons)—i

received

Percentage

of

(number

Average
Orders

INSTITUTE)—Month

CAR

August:

METAL

Production

—-—

347.3

ASSOCIATION:

PAPERBOARD

NATIONAL

loans

payments
credit

FREIGHT CAR OUTPUT—DOMESTIC (AMERI¬

of

('

47

300

public.

(BUREAU

Production

115.04

120.43

Sept. 12

DAILY

87

45

103.000c

14.000c

95

55

Conservation and

22.425c

*18

42

facilities

public service

22.200c

15.000c

Sept. 12

__

YIELD

187

water

22.250c

.Sept. 12

Baa

BOND

*200

46

:

Oven coke stocks at end

corporate

MOODY'S

204

(other than mili¬

nonresidential

naval

97.500c

.Sept. 12

Aaa

A

other

22.425c

.Sept. 12
.Sept. 12

Average

37

institutional

23.500c

AVERAGES:

Bonds—

Government

8
681

*24

97

and

and

Beehive

MOODY'S

11
-*680

27

building

24.425c

—Sept.
Sept.

at

Louis)

11
718

Educational

Sewer

3?
43
238

19

3.837c

All

29

45
222

building

Miscellaneous

York)

30

45

private

Military and
Highways

refinery at
refinery at

tin

140

313

230

•

construction

5

Sept.

Domestic

Btraits

113

296

telegraph

utilities

tary or naval facilitiesi

QUOTATIONS):

12

116

...

J

Residential

Electrolytic copper—
Export

•

23

305

public

other

Public

7

__Sept.
.Sept.

J.

types

Industrial

ton)

M.

recreational

utilities

Telephone

6,459,386

BRAD-

tor )

&

_.

construction

Farm

295

PRICES:

gross

buildings

...

Educational

Railroad

Sept.

—

77

15

325

Remaining
Sept.

INDUSTRIAL)

782
689

Hospital and institutional..

8,075,000

961 000

Sept.

gross

90

—

(nonfarm)

Commercial

SYS¬

Finished steel (per lb.)

iron

*1,120

17

*

building

Nonresidential

Pig

*1,225

93

.*

_

320

Other

11 020 000

2

2

INC.

IRON AGE COMPOSITE

1,250

J

Industrial

22,424,000

*

AND

$2,195
"1,514

$2,730

(nonfarm)-;

Nonhousekeeping

58,141,000

2

kwh.)__

(COMMERCIAL

STREET

*$2,650*1,970

OF

alterations

and

76,549,000

All

FAILURES

41,330

millions):

__u

construction.

74,339
84,88$

*67,463

1,140

(in

*20,417

2,012

DEPT.

S.

August

*84,116

14,451

period _(tpns)_

building
dwelling units

Additions

79,365

76,847

lbs.)—.

(tons)

of

of

87,469,000

III Sept.

INDEX—FEDERAL

INSTITUTE:

(in

73,819

Warehouses, office and loft building
Stores, restaurants and garages

AVERAGE=100

ELECTRIC

Electric

end

construction.,

Public

EDISON

2,000

period

at

CONSTRUCTION—U.

new

MINES):

(tons).;.

SALES

of

of

end

orders

LABOR—Month
Total

$146,541,000

_Sept.

Pennsylvania anthracite
Beehive coke (tons)

DEPARTMENT

63,193,000

IZZZZZZZBelt.

BUREAU

$164,018,000

77,868

INC—Month of

Social

"sPnt

Federal*1*!! munlcipal
COAL

$342,486,000
222,705,000
119,781,000

59,434,000

sPnt

——-

173,340,000
3,649,000

output, all grades (tons of

(tons

at

New

3,759,000

Private

197,844,000
X 1404,000

lbs.)

BUILDING

569,326

$256,077,000
192,884,000

5,927,000

190,030,000
10,690,000

export

(bbls.)

Residential
t

13,618,000

10,135,000

73,399

stocks

smelter

Shipments

.

g

11,000
12,000,000

17,000

14,931,000
10,203,000

.

zinc

2,000

703,934

*692,683

159,062,000
147,098,000
11,953,000

14,229,000

August:
Slab

NEWS-

'j.,

..

'='838,429

707,459

173,687,000
159,441,000

14,237,000
17,000

imports

AMERICAN ZINC INSTITUTE,

852,321

Age

161,332,000

(bbls.)

:

Private

[

•

2

output

(bbls.)
consumption—domestic and

Increase—all

76,430,000

41,437,000

Year

Month

gal¬

42

(bbls.)
imports (bbls.)

(bbls.)

25,560,000

of

(bbls.)

output

output

products

Indicated

104,834,000

23,560,000

oil

7,226,000

105,563,000
25,670,000
69,179,000

(bbls.

—

crude

gasoline

oil

Refined

17,891,000
1,560,000

Previous

175,586,000

production

each»

Unfilled

connections

of that date:

INSTITUTE—Month

PETROLEUM

domestic

Stocks

Revenue-freight,

are as

June:

Total

1,596,500

ASSOCIATION:.OF- AMERICAN RAILROADS:
Revenue

either for the

Latest

8,219,000

lines^

are

Month
AMERICAN

86.6

Natural

'

fuel

Ago

99.6

42

(bbls.)__~

average

of quotations,

cases

Year

Ago

in

or,

Domestic

(bbls.)

oil,
Residual

Month

Week

production and other figures for the

cover

Dates shown in first column

date,

of

tons)

output

—daily

output

Gas.

Previous

that

INSTITUTE:

condensate

gallons each)
Crude runs to stills

on

lons

PETROLEUM

oil

month ended

m

p *11

and

or

month available.

Week

INSTITUTE:

(percent

Equivalent to—
Steel

week

or

Latest

STEEL

operations

following statistical tabulations

latest week

ratio—per cent_w.

Tr_t-__4—^

r—~

railway operating ;incom£; befovercharges
income after charges (est.

}

588,763,307

569,270,199

$84,272, ?JT>

,$66,260,085

jj|'A.00%

$941034,726
84,059,998
59,000,000

81.30%

* 90,046,721
50,508,420
72,000,000^^ £6,000,000

*Revised
the
tons

figure.

producers'

and platers' quotations.
SBased on platers' quotations.
(IDomestic,;five
but less than carload lot packed in cases, ,f.o.b. New
York) 5 **F.o.b. Port

or

more

-

1 Based

rn

the

Colburne, N. S., U. S. duty included.

producers"'quotation.

§§Tin contained,

fBased

on

the

average

or

ttDecrease—all' stocks (bbls.).

(1022)

85

The Commercial and Financial Chronicle

'

Alabama

Power

Avco

Birmingham, Ala.

Co.,

filed 64,000 shares of 4.z0% preferred stock
(par $100) offered in exchange for a like number of out¬
standing 4.20% preferred shares of Birmingham Electric
Co. No underwriter. Offer expires Sept. 22. Statesment
28

effective

Aug. 29.

Manufacturing Corp.,

N.

Inc., at the rate of two Avco shares for each Ben¬
Offer expires Sept. 15.
Dealer-Managers—

ances,

dix

share.

Emanuel, Deetjen & Co. and Lehman Brothers.

State¬

Allen

Co., Allentown,

Organ

July 19 (letter of notification)

Price—At par. Underwriter—None. Pro¬
of plant and development of other

$100).

ceeds—For expansion

electronic

Allentown,
•

Alms

Office—8th

products.

Streets,

Pittston

and

Pa.

Hotel

Cincinnati,

Corp.,

Big West Oil & Gas Co.,

1,500 shares of 6% pre¬

stock

writer—None.

(par

Price—$2

$1).

Proceeds—To retire

per

share.

Securities

Inc.

Co.,

Proceeds—To

Co.;

Boston

Glore,

-

Blair

Aug.

8

Holdings Corp.

be received up to noon (EDT) on Sept. 19
company's offices, Room 710, 75 Public Square, Cleve¬
land, Ohio. Statement effective Sept. 6.

Aug.

notification)

(letter of

capital

shares of

15,000

(approximately $2.75

per

stock.

share).

New

• *"

York.

III.

Botany
Sept. 1
stock

Mills,

Inc.,

Passaic,

(letter of notification)

Price—$10

$1).

(par

per

New York

10

shares held
(with an over-subscription privilege);
rights to expire Sept. 14. Price—$22 per share. Under¬
stock of

increase

in

Statement effective Aug. 24.

Appalachian Life Insurance Co.

Sept. 8
stock

(letter of notification)

(par

None.
life

$5).

Price—$10

5,000 shares of

provide
business.
Office—1007

insurance

common

share. Underwriter—
capital and surplus for

per

Proceeds—To

Fifth

Arcturus

Electronics, Inc., Newark, N. J.
Sept. 12 (letter of notification) 50,000 shares of 6% con¬
vertible preferred stock (par $5) and 100,000 shares of
class A stock (par one cent) in units of one preferred
shares.

and two class A

Price—$5.20 per unit.
Under¬
writer—Gearhart, Kinnard & Otis, Inc., New York, N. Y.
Proceeds—For

expansion

and for working

Arkansas

program,

to

repay

advances

capital.

Power

Underwriter—

share.

and

&

45,891, shares

of

outstanding $6 preferred;
and (b) the carrying forward of the company's construc¬
tion program. Bids—Received by
company up to noon
(EDT) on June 19, but rejected. Only one bid was made
of $100,003 per share, with a $4.95 dividend from Lehman
Brothers, Equitable Securities Corp. and White, Weld &
Co. (jointly). Statement effective June 12. No further
decision

California

reached.

Natural

Service

Co.

For

Gas

1965 and

offered

stock.

32,000 shares of
units

in

of

Price—$150

common

$100
per

unit.

(par $5)

stock

debentures

and

10

filed

offered
for

Power

10

held, with

Underwriter—To

of 454,457 shares of
ers

named

in

one

new

-amendment,

an

Five months

common

of

oversubscription privi¬

an

be

rate

at the

(no par)

stock

common

holders

present

each

Mich.

Co., Jackson,

499,903 shares of

along with offering price.

ago

offering

an

stock to common stockhold¬

underwritten

was

by a group headed by Morgan
Price—Expected to be not less than $33

Stanley & Co.

share.

Proceeds

Underwriter—None.

of

Pro¬

ceeds—For

unpaid construction costs and to repay 6%
90-day notes given to directors; the balance for working
capital. Business—Operating horse racing plant. State¬
ment effective Aug. 29.
Central

Maine

Power Co.

Aug. 23 filed 260,000 shares of

Offering

construction.

For

—

—

July 28

income notes dated June
Price—At

100

in prosecuting

incurred
and

$250,000

5-year

Underwriter—National

Proceeds—To

pay

In¬

expenses

infringement actions under

commercialization

for

6%

of

1, 1950 in multiples of $1,000.

interest.

and

vestors Service, New York.
tent

N. Y.

Refrigeration Corp.,

(letter of notification)

of

patent.

pa¬

Office—50

Broadway, New York, N. Y.

(9/19)
stock

common

Continental

to be

shares

(par $10).

Credit Finance

Underwriter—To be determined by competitive bidding.

Inc., Akron, O.

Services,

Probable bidders: Blyth & Co., Inc., and Kidder, Peabody
& Co. (jointly); First Boston Corp. and Coffin & Burr,
Inc. (jointly); Harriman Ripley & Co., Inc.
Proceeds—

Aug. 4 (letter of notification) $300,000 of 2% to 4% cer¬
tificates of investment. Price—$50 and up per upit. Un¬
derwriter—None.

Proceeds—For

—316 South

Street, Akron, O.

go' to

New

England Public

Service

Co., the selling
stockholder, who will use proceeds to pay its outstanding
notes.
Bids—Will be received at office of Nepsco, at
Room 166, Parker House, Tremont and School Streets,
Boston, Mass., up to 11 a.m. (EDT) on Sept. 19.
Central

Neb.

Aug. 2 filed 94,035 shares of common stock (par $10)
being offered to common stockholders of Central Electric
& Gas
one

Co., the parent, of record Aug. 11, at the rate of
share

for

stock

held,

new

common

each

shares

13

with

of

Office—105

Boulder, Tulsa, Okla.

N.

Main

Central

stock. Price—At

par ($10 per share).
promotional and de¬
velopmental activities and for working capital.
Office—
164 Duane St., New York 13, N. Y.
4
$
common

Proceeds—For

J

.

t

Dayton Power & Light Co.

Electric

Sept.

13

filed

50,000

shares of

tp be sold to employees.

ment.

f|r

an

Dealer-Managers—Paine, Webber, Jackson & Cur¬

and

Stone

&

Webster

Securities

Telephone & Telegraph Co.

Corp.,

Chase Candy

Co.,

New

York.

Aug. 28 filed

147,861

to

first

be

offered

to

shares of

stock

common

stockholders

common

(par $1)

other

than

F, S. Yantis & Co., Inc., on the basis of one share for each
two shares held.
Unsubscribed shares to be publicly
offered.

Co., Inc., Chicago, 111., who had in June,
1949, purchased 200,000 shares at $2.50 per share. Pro¬
ceeds—To selling stockholder.
Citizens Credit Corp.,
2

Washington, D. C.

(letter of

notification) 3,000 shares of class A
(par $12.50) and 1,000 shares of class B
stock (par 25 cents), to be sold in units of three

struction

Office—1707 Eye St., N.

and

share of

one

class

B

$7)

program.

Delaware Gazette

8

Ohio

of

(letter

mortgage

bonds.

Company,

struction

of

Co., Delaware, O.

notification) $140,000 of 5% first
Price—At 101V2.
Underwriter—The

Proceeds—For

Columbus, Ohio.
building.

con¬

newspaper

Delaware

Power

&

(9/26)

Light Co.

AU$ 29 filed $12,000,000 of first mortgage and collateral
tru$4 bonds due Sept. 1, 1980. Underwriter—To be de'*t^minated by competitive bidding. Probable bidders:
ilsey, Stuart & Co. Inc.; Kuhn, Loeb & Co. and Salomon
|os. & Hutzler (jointly); First Boston Corp.: Union Seirities Corp.; Lehman Brothers; Morgan Stanley & Co.;
rhite, Weld & Co. and Shields & Co. (jointly); W. C.
mgeley & Co. Proceeds—For construction program of
lpany and its two subsidiaries. Bids—Will be received
IT to 11.30 a.m. (EDT) on Sept. 26 at company's office,

stock

shares of class A stock

(par

subtracting 15% from the average price
the preceding 12 months. Underwriter—None. Pro¬
general funds and used, in part, for con¬

Price—To be filed by amendment. Underwriter

—F. S. Yantis &

stock

ceeds—For

Sept.

Louis, Mo.

common

Price—To be set each six-

month period by

Statement effective Aug. 22.

St.

30,000 shares of class C

(letter of notification)

non-voting

overscription privilege;
rights expire Sept. 20.
Price—$10 per share.
If any
balance is publicly offered terms will be filed by amend¬
tis

working capital. Office

Daily Compass Publishing Corp., N. Y. City

J

Aug. 21

Underwriter—None.

Telephone Co., Lincoln,

Price—$44.50 per unit. Underwriter—Emory S. Warren
& Co., Washington, D. C. Proceeds—For
general funds.

line.

common

Aug. 14 filed $320,000 of 6% sinking fund debentures due

common

Co., Tulsa, Okla.

transmission

of

Temporarily postponed.

build

gas

be

lege.

common

natural

23

Sept. 7 filed 80,000 shares of cumulative convertible pre¬

March 14 (letter of notification) 2,500 shares of common
stock at $100 per share., No underwriter. Proceeds to
a

shares

200

working capital.

ferred

Inc., Littleton, Colo.

of

Consumers

to

stock, series F (par $25). Underwriters—To be
supplied by amendment—probably Dean Witter & Co.;
Blyth & Co., Inc. Proceeds — To restore treasury funds
used
to finance construction and purchase
of capital
assets and to repay short term bank loans.

(letter

notification)

3

share

June

Associated

Water

Proceeds—To pay unsecured note held by International

Light Co.
May 23 filed 155,000 shares of cumulative preferred stock
(par $100). Proceeds—To be applitd to (a) redemption
on Aug.
1, 1950, at $110 per share plus dividend ac¬
cruals, of all the 47,609 shares of outstanding $7 pre¬
ferred

Engineering Corp., Pasadena,

((par $1), to be issued upon exercise of option by
F. Dufresne. Price—$5 per share.
Proceeds—

Proceeds—To Chas. F. H. Johnson, Jr., VicePresident, the selling stockholder.

Avenue,

Huntington, W. Va.
•

selling stockholders.

To

investments

Michigan Consolidated Gas Co. and Milwaukee

Gas Light Co.
•

Proceeds—To

common

Armand

per

Aug. 4 filed 334,934 shares of common stock (no par), of
which 304,486 shares are offered to common stockholders
of record Aug. 24 on basis of one new share for each

writer—None.

of

Sept.
common

White & Co., both of New

P.

Centennial Turf Club

(par $5) be¬
ing offered to stockholders of record July 25 at rate of
one new share for each three held; rights will expire on
Sept. 25. Price—At par. Proceeds—For general corporate
purposes.
Business—Casualty insurance. Statement ef¬
fective July 26.
Gas Co.,

shares

stock

N. J.

1,200 shares of

York City.

Co., Chicago

June 28 filed 100,000 shares of capital stock

Natural

Proceeds—To

2,385

Underwriter—Cohu & Co.,

California

P. F. Fox & Co. and John

•

Aug. 25 (letter of notification) 6,000 shares of common
stock (par $2), to be sold to underwriter at $16 per share.
Price—At market.
Underwriter—H. M. Byllesby & Co.,
Chicago, 111.
Proceeds—To Grover Hermann, President
of company, the selling stockholder.
No general public
offering planned.

American

share.

per

I

explore and acquire
bodies. Registra¬

Insurance

Price—$25

Consolidated

June

Motorists

Enameling & Stamping Co.

(letter of notification)

3

1

(9/21)

21.

American

Blyth & Co., Inc.;
& Co. and W. C.

Forgan

by competitive
& Co. Inc.;
White, Weld &
Langley & Co.

Stuart

Halsey,

at

Underwriter—First California Corp., San Francisco, Cal.
Proceeds—To
Virgil D. Dardi, President, the selling

ore

Co., Chicago,

Corp.;

determined

be

bidders:

Probable

Bids—Will

Price—To be filed
Underwriter—H. M. Byllesby & Co., Inc.,
Chicago, 111. Proceeds — For drilling and development
expenses and for working capital.

class B

tion statement expected to become effective about Sept.

American-Marietta

Underwriter—To

by amendment.

of 5%

stock. Price—At market

Sept. 1 filed 500,000 shares of common stock (par 10c).
Price—$3.50 per share. Underwriter—First International
claims and concessions for uranium

(9/19)

Illuminating Co.

shares for each $1,000 of debentures).

$1,760,000

stockholder.

Co., Ltd.

Statement

Co., New York.

(jointly); Dillon, Read & Co. Inc. Proceeds—To repay
$8,000,000 bank loans and for construction program.

5 filed

Under¬

class A and

Uranium

1985.

1

Columbian

bonds.
American-Canadian

Cleveland Electric

Ohio

(letter of notification)) 23,227!A shares of class
A common stock (par $1) and 63,227Vz shares of class B

&

16.

sinking fund debentures
due 1965 (convertible into common stock on basis of 200

Sept

Aug. 31

common

Dallas, Tex.

ADDITIONS

Aug. 22 filed $25,000,000 first mortgage bonds due Sept.

First

(par $100) and 750 shares of common stock

ferred stock

(par

Pa.

INDICATES

Hutton

E.

effective Aug.

bidding.

ment effective Aug. 8.

Thursday, September 14, 1950

.

SINCE PREVIOUS ISSUE

Manager—W.

Y. City

July 14 filed 1,500,000 shares of common stock (par $3)
offered in exchange for shares of Bendix Home Appli¬

.

•

Securities Now in Registration
July

.

stock.

j)0 Market St., Wilmington, Del.

W., Washington, D. C.
Detroit Hardware Manufacturing Co.

Citizens Telephone Co., Decatur, Ind.

ig. 4 (letter of notification) 100,000 shares of

April 27

(letter of notification) 3,000 shares of 4%%
preferred stock, non-convertible. Price—At par ($100
per
share).. Underwriter—None. Proceeds—For plant
additions

and

conversion

240 W. Monroe St.,

to

dial

operations.

:k

(par

New York.

Boston

Philadelphia

^Pittsburgh

San Francisco

Chicago

Cleveland

share;
Private Wires




to

all

offices

,f.j.

s|^t.
common

stock

(par $5)
(par $10) of Oppenheim, Collins & Co., Inc., and for the 4%% convert¬
ible preferred stock (par $50) and common stock
(par
$1) of Franklin Simon & Co., Inc.. at the following

ratios:
share

stock

1%

shares for each Oppenheim, Collins common
two shares for each Franklin Simon preferred

and

Franklin

one

share

Simon.

for

Offer

each

expires

working

for

capital.
.

-

Office—1320

two
on

common

Sept.

18.

shares

of

Dealer-

Mt.

|
.j

Diana

common

and

(iott Avenue, Detroit, Mich.

common

Underwriter—
Proceeds—To expand

share.

per

in '

Decatur, Ind.

July 17 filed 149,317 shares of

Price—$3

FG. McDonald & Co., Detroit.

fjlilities

Office—

City Stores Co.
offered in exchange for

$1).

Stores

Corp., New York

(9/25-29)

6 filed 100,000 shares of common stock

(par 50

ceftts). Price—To be filed by amendment. Underwriter
/an Alstyne Noel Corp., New York. Proceeds—To

seeing stockholders.
•

] Dundee

(N. Y.) Tel. & Tel. Co. (9/15)

Sep|.\ 11 (letter of notification) 300 shares of preferred
and 160 shares of

common

Underwriter—None.
and

accounts

stock.

Price—$50

per

share.

Proceeds—To refund bonds, notes

payable and for construction

program.

•

Volume 172

Number 4942

..

The Commercial and Financial Chronicle

.

(1023> -39
El

Paso

Natural

Gas

Co.

(9/19)

record

Aug. 31 filed 230,000 shares of common stock (par $3)
to be oifered for
subscription by common stockholders
of record Sept. 19 at the rate of one share for each
10
shares

held

with

oversubscription

an

Will expire on Oct. 4.

privilege;

$2.50

MEW ISSUE CALENDAR
September 14,

Underwriter—If
Stone
either

a

ing

in

vertible debentures due

1963.

Aug.

7

stock,

filed

corporation

($100

par

To

10,000 shares of 4%

be

to

offered
of

and

preferred
employees of this

Candy Co., parent. Price—At
Underwriter—None.
Proceeds—

equipment and

real estate

for

mon

stockholders

each

12

along

shares held.

Meek

&

Co., New York.

to

complete purchase of

(John) Industries, Inc

•

Central Maine Power Co. 11

-

:

working capital.

Federal Television Corp.,

writer—John F. McBride, New York.

pansion and working capital.
New York, N. Y.

(9/14)

...

^

,

:

f

(Ala.)

preferred

ize

Price—At

($25

Proceeds—To extend

Stores

-.Diana

cumu¬

:/ll:30

;

Power

Power

Corp.,

St.

modern¬

loans

for

and

construction

Logan Home Telephone Co., Logan, Ohio
Bonds

first

Common

&

Light Co._Notes & Com.
1950

11

a.m.

October

Bonds

stock

30

stock
in

filed

(par $1)

exchange

Douglas

maximum

a

of

to be offered

•

Consumers Power Co

for

Shoe

common

Stores

stock

$1)

(par

stock

issues.

(par $1).

220,000

and

Underwriter—R.

Price—$1.10

shares

of

Mines

J.

Corp.,

Ltd.,

class

•

B

share for both

per

Edwards, Inc.,
Proceeds—To expand chain stores.

Granville

British

filed

None.

100,000

5Hc)

(par

shares

of

Price—35c

Proceeds—To

working caniial

buy

mining

Oklahama

stock

Common

Preferred

Metropolitan Brick, Inc., Canton, Ohio
Aug. 29 (letter of notification) 50,820 shares of common
stock to be offered to present
common
stockholders.
Price—At par ($4 per share). Underwriter—None. Pro¬

on

and

the basis of

one

share for each 10 shares held.

Kaye-Halbert Corp., Culver City, Calif.

foi

Julv

?

filed

28

100.000

shares

of

class

A

common

stock

(par $1).

Price—$5 per share. Underwriter—Sills, FairHarris, Inc., Chicago, 111. Proceeds—For working
capital.
^ 1'i»

stock, to be of¬
Price—At par ($20

Underwriter—None.

Middle

Key West

Propane Gas

Corp.

Middle

Aug.

(9/15)

(letter of notification) 8,000 shares of $1.50 pre¬
ferred stock (no par) and 9,777 shares of common stock
(no par), to be offered first to stockholders.
S25

share,

per

Underwriter—F.
ceeds—To

L.

retire

and

Putnam

bank

loan

&

and

common

$10

Sept.

7 filed
be

115,263 shares of
filed

Becker & Co. Inc.,

Price—Of

sharje.
Co., Boston, Mass. Pro¬
for

per

working capital.

Holeproof Hosiery Co., Milwaukee,

Price—To

stock Coar $51.
Underwriter—A. G.
Proceeds—To a group of

(letter

of

Lancaster Processes,

Sept. 7

Inc., N. Y. City

(9/15)

$2.50)

to

be

offered

1970
Price—In excess of 102%.
Undcrwriter-iWachob Bender Corp., Omaha, Neb.
Proceeds—To retire

temporary loans.

to

common

stockholders

of

Mines

Corp., San Francisco,

selling1'stockholder.




offered

Water

to

Co., Newark,
5,200

of

common

Pro¬

N. J.

shares

stockholders

common

one-for-five

at

of

$50

common

per

share

basis.

Underwriter—Clark, Dodge &
working
Indefinitely postponed.

(Walter R.) Co., Inc.
(letter of notification) 1,000 shares of 6%
cumulative preferred stock at par ($100 per share). Un¬
derwriter—George D. B. Bonbright & Co., Binghamton,
N. Y. Proceeds—To assist in acquisition of 1216 shares
6

Mineral

/

iondott Associate
The

stock

500,000

(par 10 cents).

shares

of

non¬

Price—25 cents

IEaGRAYE PRESS, Ltd.

E. Broadway,

Missoula, Mont.

Mission

Appliance Corp., Hawthorne, Calif.
July 24 filed 50,000 shares of 6% cumulative convertible
preferred stock. Price—At par ($20 per share). Under¬
writer—Lester & Co., Los Angeles,, Calif. Proceeds—To
retire bdnk loans and install machinery and equipment
in

r
UCOftMlOC <md HWm$OHr hc,

common

Missoula, Mont.

share. Underwriter—None. Proceeds—For working
capital to continue exploration and development. Office

PRINTING CO., Inc.

Chicago Associate

King Mining Co.,
of notification)

(letter

per

-r-1001

W0

>< iii-

28

assessable

SORB

f

(letter of notification) 10,000 shares of common
Price—At market (about $1.40 per share). Under¬
writer—E. F. Hutton & Co., San Francisco.
Proceeds—

shares

Underwriter—None.

Proceeds—To pay notes and for additional

Aug.

stock.

a

share.

company's common stock

Aug. 8

To

per

(letter of notification)

March

•

80 SOUTH ST!, NEW YORK 7, RUT.
Maryland

California

a

CONFIDENTIAL

SINCE
bonds

due

Idaho

Telephone Co.
notification) 410

Miller

(letter of notification) 100,000 shares of 6% cu¬
(if earned) and convertible preferred stock

mulative

SERVICE

Hooper, Neb.
notification) $30,000 of 3%%

9

capital.
•

common

by amendment.

Chicago, 111.

on

Co.

City Gas Co.

(par

Hooper Telephone Co.,
18

of

Price—$14

stock

Pa.

bonds and notes of

each). Underwriter—Bioren&Co.,
Proceeds—To purchase outstanding
Key West Gas Co. and stock of Island

Wis.

28 selling stockholders.

Aug.

States

(letter

Middlesex
Feb.

Philadelphia,

•

Sept. 1

•

23

.

Greenwich Gas Co., Greenwich, Conn.

Inc.

ceeds—To Central Telephone Co., the selling stockholder.

Price—At par ($1,000

preferred.

South Utilities,

Equitable Securities Corp will serve as "dealer-man¬
ager." 1 (See also listings of Arkansas, Louisiana and
Mississippi companies elsewhere in these columns.)

Sept. 1 (letter of notification) $125,000 of series A bonds.

ing capital.

promissory notes and for plant improve¬
Bldg., Canton, O.

—Arkansas Power & Light Co., Louisiana Power & Light
Co. and Mississippi Power & Light Co. Underwriter—

stock.

Proceeds—For work¬

pay

Office—Renkert

June 1 filed 400,000 shares of common stock (no par) to
be offered to preferred stockholders of three subsidiaries

&

man
*

ceeds—To
ment.

Price—

common

subscription by employees.

share).

Underwriter—
10.

15,973 shares of common
(par $5) to be offered first to common stockholders

Underwriters—Loewi & Co., Shearson,
Hammill & Co. and Bell & Farrell, Inc.
Proceeds—For
working capital.

non-assessable

machinery

Manufacturing Co., Fort Atkinson, Wis.

(letter of notification)

$18.75 per share.

Columbia

Inc., New York

Aug. 23 filed 72,000 shares of
per

share.

Statement effective May

Graybar Electric Co.,
fered for

common

per

James

Sept. 6

Canada
16

stock

Common

Co., Inc., Oklahoma City, Okla.

common

Feb.

Telephone Corp._____

common

(no par)

chased

(letter of notification) 27,000 shares of class A

15

common

Corp., New York City
(letter of notification) 8,995 shares of

derwriter—None, but unsubscribed shares to be pur¬
by Lansing Foundation, Inc., 65 Broadway, New
York.
Proceeds—For working capital and general cor¬
porate purposes.
Office—295 Madison Avenue, New
York 17, New York.

Common

United States Plywood Corp

Gosseiin

City.

Water Co

Southern Co.

July 25.

Aug.

Common

Rochester

outstanding preferred stock of W
L
No underwriter. Statement effective

(9/18-22)

to be offered to stockholders of record
Sept. 11, 1950 at rate of one share for each 4% shares
held; rights expire Sept. 26.
Price—$10 per share.
Un¬

Common

Co., Inc

Middlesex

Co.

Inc.

Mercast

stock

-Common

Fedders-Quigan Corp.

share-for-share basis

a

Industries,

Co., Cleveland, O. Proceeds—For working capital. Ex¬
pected week of Sept. 18.

Sept. 5

General Radiant Heater

shares of

32,885
on

Common

OFFERINGS TEMPORARILY POSTPONED

*

June

(John)

common stock (par $1).
Price—To be filed by amendment. Underwriter—Otis &

(par 250

Corp., Nashville, Tenn.

f

of California,

Aug. 28 filed 150,000 shares of

11, 1950

1-

•

Amendment may be filed.
Shoe

Meek

Debentures

1950
(EST)

Chemical

Newhall, Calif.
May 31 (letter of notification) 282,250 shares of capital
stock. Price—At par ($1 per share). Underwriter—Floyd
A. Allen & Co., Inc., Los Angeles, Calif. Proceeds—To
buy land, build a plant and equip it to produce so-called
"impact" plastics. Office—244 S. Pine St., Newhall, Calif.

Ky.

Price—$3 per share. Proceeds—For plant and warehouse,
advertising research, working capital, etc. Temporarily

General

Loven

1950

Utah Power & Light Co. noon

reached,

Debs.
Common

October 9,

but

further decision

(EDT)

Ohio Edison Co

postponed.

by company up to noon (EDT) on June
rejected.
Three bids were made as follows:
Union Securities Corp., $100.40 per share with a $4.65
dividend; Blyth & Co., Inc., and Equitable Securities
Corp. (jointly), $100.10 with a $4.65 dividend; and W. C.
Langley & Co. and First Boston Corp. (jointly), $100.30
with a $5.80 dividend. Statement effective June 12. No
19,

Common

October 4,

Co., Inc.
common

Bids—Received

Bonds

Grocery Co..

Sierra Pacific Power Co

Broadway, Louisville, Ky.

170,000 shares of

Louisiana Power & Light Co.
May 23 filed 90,000 shares of preferred stock (par $100).
Proceeds—To be used to redeem, at $110 per shart plus
dividend accruals, the 59,422 shares of outstanding $6
preferred stock, and for construction and other purposes.

Light Co.

Sierra Pacific Power Co.

—None. Proceeds—For working capital. Office—334 East

May 3 filed

Ohio Co., Columbus, Ohio.
installation of automatic ma¬

for

pay

chinery.

Common

-

October 3,

July 17 (letter of notification) 101,500 shares of common
stock (par 50 cents). Price—$2.11
per share. Underwriter

General Radiant Heater

Underwriter—The

Proceeds—To

Pfd. & Common

New Bedford Gas & Edison

Fla.;

program.

Plywood Corp., Louisville,

(letter of notification $50,000 of 20-year 3V2%
bonds, series A, due 1969.
Price—At

mortgage

102.17.

Vanadium Corp. of America

General

Aug. 25

September 27, 1950

Petersburg,

Co. and Merrill Lynch,
Pierce, Fenner & Beane (jointly);
Lehman Brothers; Urnon Securities Corp. Proceeds—To

bank

Co.

(EDT)

a.m.

Winn & Lovett

Sept. 1 filed 40.000 shares of cumulative preferred stock
(par $100). Underwriter — To be determined by com¬
petitive bidding. Probable bidders: Kidder jpea
&

repay

Common

Corp

plant, lines and other telephone facilities
Florida

Office—630 Fifth Avenue, New York 20,

New York.

September 26, 1950

"-Delaware

share)

per

and

Proceeds—For working capital and general cor¬

porate purposes.

September 25, 1950

•

par

—None.
Bonds

.Safeway.-Stores, Inc.-'

ex-'V*

Office—139 Duane Street,.

notification> 1,200 shares of 4%

stock.

(N. Y.)

Under-*

Proceeds—For

Telephone Co.

Underwriter—None.

(EDT)__Common

American-Canadian Uranium Co., Ltd

r

common

"

lative

Proceeds—To selling stockholder.

(letter of notification) 300,000 shares of capital
stock (par 10 cents). Price—$1 per share. Underwriter

September 21, 1950

;

Florala

New York.

June 30

El Paso Natural Gas Co

:

Offering postponed.

N. Y.

a.m.

(EDT)

pay promissory note;v;' ^Ne.w^'Utampshire Electric
plant at El Monte, Calif.
A;\ vli~30 a m. (EDT)

new

Sept. 7 (letter of notification) 600,000 shares of
stock (par one cent). Price—50 cents
per share.

June 29 (letter of

Common

Price—At market

Common

Cleveland Electric Illuminating Co.
noon

selling stockholder.

& Sons Co.

Leigh Foods, Inc.
con-

(par $50) to be offered to com¬
of one preferred share for

a

(James)

(letter of notification) 4,100 shares of common
(estimated at $24 per share).
Underwriter—To be sold through Wood, Struthers & Co.,
stock.

Standard Coil Products Co., Inc

Proceeds—To

and for additional

Lees

Proceeds—To

Sept. 11

-

Price—To be filed by amendment.;.,
rate.
Underwriter—Smith, Barney;

with dividend

-Common

September 18, 1950

basis

on

•

September 19, 1950

filed 103,402 shares of series A cumulative

vertible preferred stock

California Co.

Bonds
Preferred

-■

its parent.

Langendorf United Bakeries, Inc.

1 filed 50,000 shares of common stock (par $1).
Price—To be filed by amendment. Underwriter—First

Pfd. & Com.

Processes, Inc

Fedders-Quigan Corp.

,■

June 21

Telegraph Co

Monarch Radio & Television Corp

cumulative

and

Curtis

share).

per

acquire

officers

to

Proceeds—For

Sept.

Key West Propane Gas Corp
Lancaster

Equipment Finance Corp., Chicago, III.

Underwriter—None.

Office—620 Fifth Avenue, New York

Common
•

Dundee Telephone &

[par $2] and 50 cents in cash for each

share.

working capital.
20, N. Y.

September 15, 1950

part of the outstanding 2V2 % bank notes matur¬
1951 and 1952 or a portion of the 3%% con¬

share

one common

1950

Federal Television Corp

any, may be White, Weld & Co. and
Webster Securities Corp.
Proceeds—To retire

&

with fights expiring Oct. 15.
Price—
(payable as to 61,321 shares at rate of

6,

share

preferred

rights

Price—To be filed by amendment.

Sept.

per

a

proposed new plant to be located east of thp Rocky
Business—Manufacturer of gas and electric

Mountains.
water and

space

heaters.
"

'

Continued

on

page

40

40

The Commercial and Financial Chronicle

(1024)

Continued

from

39

page

Mississippi Power & Light Co.
May 23 filed 85,000 shares of cumulative preferred stock
(par 100). Proceeds—To be used to redeem at $110 per
share plus dividends, the outstanding 44,476 shares of $6
preferred stock and for construction and other corpo¬
rate purposes.
Bids—Received by company up to noon
(EDT)

on

follows:

as

with

June 19 but rejected. Four bids were made
Union Securities Corp., $100.10 per share

$4.80 dividend; Lehman Brothers, $100,051

with
a $4.85 div.; W. C. Langley & Co. and First Boston Corp
(jointly), $100.30 with a $4.90 dividend; and Blyth & Co.,
a

Co., White,
Kidder, Peabody & Co. (jointly), $100.19

Inc., Equitable Securities Corp., Shields &
Weld & Co. and
with

Statement effective June 12.

$4.90 dividend.

a

No

further decision reached.
•

Missoula

Missoula, Mont.

Pres-To-Logs Co.,

(letter of notification)

Sept. 5
stock.

Price—At

None.

Proceeds—To

($100

par

Underwriter—

share).
plant.

•

Modern Supply Co., Inc., Pittsburgh, Pa.
Sept. 6 (letter of notification) 1,500 shares of 5%
lative

(par $100) and 15,000 shares of
voting stock (no par value—declared value $1)
in units of one preferred and ten common shares.
Price

,r—$110 per unit. Underwriter—None. Purpose—For gen¬
eral corporate purposes.
Office—837 W. North Avenue,
Pittsburgh 12, Pa.
Radio

& Television Corp.

(9/15)
Sept. 8 (ietter of notification) 600,000 shares of common
stock (par 5 cents).
Price—50 cents per share.
Under¬

writer—George J. Martin Co., New
expansion and working capital.

York.

For
?

Purpose—

Office—2430 At-

Monterey County Security Co., Salinas, Calif.
Sept. 7 (letter of notification) 2,000 shares of common
stock (no par) to be offered to present stockholders.
Price—$10 per share.
Underwriter—None.
Proceeds—
increase

Mt. Carmel

Office—201

Main

Salinas,

Street,

(III.)

Public Utility Co.
July 24 (letter of notification) 3,000 shares of 4%
ferred

pre¬

stock

being offered to common stockholders of
July 31 in ratio of one preferred for each six
common held; rights to expire Aug. 30. Price — At par
($100 per share). Underwriter—None. Proceeds—To re¬
record

tire short-term notes and expand facilities. Office
Market St., Mt. Carmel, Illinois.

—

316

Sept.
J. M.
Finch

nepin

Co., Minneapolis, Minn.
11 (letter of notification) 3,000 shares of common
Price—At $17 to $20 per share.
Underwriter—
Dain & Co., Minneapolis, Minn. Proceeds—To the
Investment Co., Minneapolis.
Office—1750 Hen¬
Avenue, Minneapolis, Minn.

New

Hampshire Electric Co. (9/19)
2 filed $3,600,000 of first mortgage sinking fund
bonds, series A, due 1975. Underwriter—To be deter¬
mined by competitive bidding. Probable bidders: Halsey,
Aug.

Stuart & Co. Inc.; The First Boston Corp.;

Kidder, Peabody & Co., and White, Weld & Co. (jointly). Proceeds
—To retire (a) $1,880,000 first mortgage bonds, series A
and B, due 1963, and (b) $1,250,000 of bank loans due
Dec. 31, 1952; and the balance for construction purposes.
Bids—Will be received by the company at Temple Street,
Cambridge, Mass., up to 11:30 a.m. (EDT) on Sept. 19.
Statement
New

effective Sept. 6.

Orleans Public Service

Inc.

Aug. 24

(letter of notification) 7.754 shares of common
stock (no par) offered to stockholders (other than Mid-

^dle South Utilities, Inc., parent) of record Sept. 1, 1950,
at

rate

of

0.168

pire Sept. 25.
None.

317

share

Price

for

—

Proceeds—To

Baronne

Street,

each

$25

per

share

held; rights ex¬
share.
Underwriter —

finance

New

plant additions.
Orleans 9, La.

Office—

1

Norlina Oil

Development Co., Washington, Dl C.
March 28 filed 600 shares of capital stock (no par.) To
offer only sufficient shares to raise $1,000,000 at $5,000
per share. No underwriter. Proceeds to be used to ex¬
plore and develop oil and mineral leases. Statement ef¬
fective May 22.
Northern

Illinois

Northwestern Public Service Co.
9 filed 49,200 shares of common stock
(par $3)
offered to stockholders at rate of one share for each 10

held Sept. 6, with rights to expire Sept. 18. Underwriter
—A. C. Allyn and Co.,
Inc., New York. Price—$10

per

Proceeds—For construction expenditures.
effective Sept. 6.

May 5

(letter of notification) 1,100 shares of common
held in treasury.
Price—50 cents per share
Underwriter—None.
To be
offered through Preston,

atock

now

Watt

and

Schoyer.

Proceeds—Toward

repayment

Telephone Co., Waconia, Minn.

preferred stock, series B. Price—At par ($100 per
share). Underwriter—M. H. Bishop & Co., Minneapolis,
Minn.
Proceeds—To expand telephone service.

Inc., Silver City, N. M.
60,000 shares of common
stock. Price—At par ($1 per share). Underwriter—None.
Proceeds—To develop mines.
Address—Box 348, Silver
Pipe Stem Mines,

.

Petroleum

Toronto Canada

Ltd.,

1949, filed 1,150,000 shares ($1 par) common
jf which 1,000,000 on behalf of company and 150,000 b>
Mew York Co., Ltd.
Price—50 cents per share. Under¬
writers—S. G. Cranwell & Co., New York.
Proceeds—
For administration expenses and drilling.
Statemenl
-vpril 25,

effective June 27,

1949.

Powers Theatres,

Aug. 30

Inc., New Orleans, La.
5,000 shares of common

(letter of notification)

stock

(no par) and 1,000 shares of preferred stock

$100)

to

be offered

build

F.

Thurmond, New Orleans,
Office—6208

theatre.

(par

share of preferred
Price—$100 per unit.

one

of common stock.

Underwriter—William
Proceeds—To

units of

in

Louis

La.
XIV

Street, New Orleans, La.
Prudential

Fire

of record

Sept. 8 on a share-for-share basis; rights expire
Price—At par. Underwriter—None. Pro¬
ceeds—For purpose of producing motion picture films
for
television, and for purchase of new equipment.
Sept. 28.

on

Office—50 Church
Southern

July 28 filed 818,415 shares of common stock (par $5)
offered in exchange for 545,610 shares of common stock
of Birmingham Electric Co. on a lVfe-for-l basis. No un¬
derwriter. Offer to expire on Sept. 22. Statement effec¬
tive Aug.

Quaker City Fire & Marine Insurance Co.
Aug. 2 (letter of notification) 10,000 shares of capital

expiring

Dec.

Unsubscribed

—

Orchards Telephone Co., Orchards, Wash.
(letter of notification) 500 shares of common
Price—At par ($100 per share).
Underwriter—

March 16
stock.

Proceeds—To modernize plant.

.Pacifiic Pow^r &rLight COi>r
r. ;
'.e-,;
Aug. 30; filed Li750,000 sbaresjof commoz^stock (no par),
representing all of ithe outstanding sharesibf tthe icbmpahy
tabg sQld.by a group of. 16, stockholders: headed by Av C.
Allyn &j Co., Inc. and Bear, Stearns i& Coi-.U>nderwifters
-rr^To be named by amendment; >
f
t
%




one-for-four basis to
with the rights
Price—$25 per share.
Under¬

4,

1950.

Oct.

a

1950,

20,

shares

be

to

"

Co., Atlanta, Ga.
June 23 filed 1,000,000 shares of common stock (par $5).
Underwriters—To be determined by competitive bidding.
Probable bidders are: Morgan Stanley & Co., Kidder,
Peabody & Co. and Merrill Lynch, Pierce, Fenner &
Beane (jointly); Blyth & Co., Inc. and Bear, Stearns &
Co. (jointly); Lehman Brothers; Union Securities Corp.
and Equitable Securities Corp. (jointly); Harriman Rip,ley & Co., Inc. Temporarily postponed. Bank Loans—■
Common
stock
financing proposal was amended in
August to provide for $12,000,000 of bank borrowings
to provide funds necessary to acquire $12,000,000 common
stock of Alabama Power Co. and Georgia Power Co.

offered

publicly

•

common

Southern

Sept. 5
ferred

shares will be made, and the proceeds

the

retire

to

loans.

bank

Social

Register Foundation,

Williamsburg, Va.
(letter of notification)
stock (par $50).
Price

1,000 shares of/6% pre¬
$250 per unit of five
compile and

—

Proceeds—To

Underwriter—None.

shares.

publish annual social register.
Natural

Southwest
June 26

Gas

Co., Shreveport, La.

13,500 shares of common
M. Craigmyle, at market

(letter of notification)

through Burton, Cluett and Dana, 120 Broadway, New
York, N. Y.
Proceeds—For working capital.
Office—

stock

226 Walnut Street,

Co., New York City.

Philadelphia 6, Pa.

(N. Y.) Telephone Corp.
125,000 shares of common stock (par $10)
to be offered to present stockholders at rate of one new
share for each four held.
Price—To be filed by amend¬
ment.
Underwriter—The First Boston Corp., New York.
Proceeds—For general corporate purposes,
struction and repayment of a loan.

including con¬
Offering postponed.

Rocky Mountain Textile Mills, Inc.
July 11 (letter of notification) $150,000 of 5% convert¬
ible sinking fund debentures, due 1960, and 15,000 shares
of

common

units

of

stock

one

(par $10), to be sold separately or in
$1,000 debenture and 100 shares of stock.

Price—Separately, at par, and in units, at $2,000 each.
Underwriters—Boettcher & Co. and Peters, Writer &
Christensen, Inc., Denver, Col. Proceeds—For new ma¬
chinery, equipment and working capital. May be placed
semi-privately.
Royal Television & Electronics, Inc.,
Washington, D. C.
June 22 (letter of notification) 600,000 shares of common
stock (par 10 cents). Price—50 cents per share. Under¬
writer—None. Proceeds—To buy television set compo¬
nents. Office—714 Fifth St., N. W., Washington, D. C.
•

Russell

(F. C.)

Co., Cleveland, Ohio
Sept. 6 (letter of notification) 7,000 shares of common
stock (par $1), to be offered to employees of the com¬
pany. Underwriter—None. Price-^Not in excess of $9.50
pfe^ sh'dre. Proceeds—To reimburse treasury in part for

Acquisition of said shares.
•

Safeway Stores, Inc.
12 (by amendment)

Sept.

shares of 4%
preferred stock (par $100) and 257,064 shares of common
stock (par $5), the latter issue to be offered for sub¬
scription by common stockholders of record Sept. 21 at
one

expire Oct. 5.

110,000

(share for each 10 shares held; rights to
Price—To be filed by amendment.
Un¬

derwriter—Merrill Lynch, Pierce, Fenner & Beane. Pro¬
ceeds—Together with other funds, will be used to repay
$20,000,000 term bank loans.

Seneca Oil Co., Oklahoma City, Okla.
April 27 (letter of notification) 225,782 shares of class A
stock (par 500).
Price—$1.25 per share. Underwriter—
Genesee Valley Securities Co., Rochester, N. Y.
Proceed*
—To acquire properties and for working capital.
Sierra

to

filed $2,500,000; of debentures due Oct. 1, 1975
and 24,716 shares of common stock (par
$15), the latter
be

offered

pro

rato

to

preferred and

common

stockholders of record

Oct. 3 on basis of one share for
each six preferred shares and one share for each 12 com¬
mon
shares held rights to expire on Oct. 19.
Under¬
writers—For
tive

debentures to be determined by competi¬
bidding^$ids to be received by company before 11

(EST) on,pet. 3); for common stock, to be supplied
by amendment together with subscription price. Prob¬
able bidder^ for debentures: Halsey, Stuart & Co. Inc.:
Stone & Webster Securities Corp.; Kidder Peabody l&
a.m.

sold

$7.37V?

share) through Craigmyle, Pinney &

per

Standard

Ronald

by

Coil

Products

(9/18)

Co., Inc.

(par $1).
Eberstadt &
Proceeds—To three selling stockholders.

Aug. 11 filed 367,500 shares of common stock

Price—$15.25
Co.

Inc.

per

share.

Underwriter—F.

Sudors Gold Minos Ltd., Toronto, Canada
June 6, 1949, filed 375,000 shares of common stock.

Price
Underwriter—None. Pro¬
ceeds—Funds will be applied to the purchase of equip¬
ment, road construction, exploration and development.
—$1 per share (U. S. funds).

Sylvan Products, Inc., Centralia, Wash.
Aug. 17 (letter of notification) 6,000 shares of 6% cumu¬
lative preferred stock.
Price—At par ($25 per share).
Underwriter
None. Proceeds
To establish plywood
—

mill.

—

Address—Box

449, Centralia, Wash.

Tennessee Gas Transmission Co., Houston, Tex.

Aug. 28 filed 100,000 shares of common stock (par $5) to
be issued in exchange for 80,000 shares of common stock

Sterling Oil & Gas Co., and for 10-year subscription
purchase 133,333 shares of Sterling common
The rate of exchange is to be supplied by amend¬
ment. Exchange Agent—The National Bank of Commerce
of

warrants to

stock.

of Houston,
•

Tex.

Tire Maintenance Corp., New

York City

Sept. 7 (letter of notification) 300,000 shares of common
stock (par 10 cents).
Price—$1 per share.
Underwriter
—Walt Clyde, 144 East 24th Street, New York 10, N. Y.
Purpose—For organizational expense and working cap¬
ital.

Address—c/o

New York

Guy M.
31, N. Y.

Bagar, 730 Riverside Drive,

Aug. 14
stock
on

to

Corp.
(letter of notification) 52,097 shares of capital
be offered to stockholders of record Aug. 21

basis of

one

new

for each five shares

held; rights to

expire in. 30 days. Unsubscribed shares to be offered to
employees and others.
Price—At par ($5 per share).
Underwriter—None. Proceeds—For expansion and work¬
ing capital.
•

Union

Office—350 Fifth Avenue, New York, N. Y.
Investment Co. of

Detroit

(Mich.)

Sept. 11 filed 55,865 shares of common stock (par $4), to
be

offered

to

common

stockholders at

share for each three shares held.

the

rate

Proceeds—For general

of

one

Price—To be filed by

amendment. Underwriter—McDonald-Moore Co,,

Detroit.

corporate purposes.

United States Plywood Corp.
June 19 filed 60,000 shares of

(10/3)

1

issue

Pacific Power Co.

be

Unexcelled Chemical

(9/21)
filed

to

(about

Rochester

June 29 filed

Sept.

,

record

29.

Southern

used

of

Street, New York 7, N. Y.

Co.

year.

(par $4). Price—$6 per share. Underwriter—None.
Proceeds—To increase capital to become multiple line
company.
Office—Braniff Bldg., Oklahoma City, Okla.

(par $20). to be offered on

York City

(letter of notification) 75,292 shares of common

(par $2.50) to be offered to common stockholders

Aug. 30 (letter of notification) 50,000 shares of common

stockholders

Webster

&

construction.

new

1,000,000

stock

Stone

bank loans and to

($6,000,000 in each), the bank loans to mature in one
As soon as practicable and feasible, sale of the

Co.

Insurance

stock:

Smith-Dieterich Corp., New

Sept. 8 (letter of notification)

Power

for

Proceeds—To pay

Corp.

Calif.

stock

lative

Thursday, September 14, 1950

.

Simmel-Meservey Television Productions, Inc.
June 29 (letter of notification) 150,000 shares of common
stock
(par $1).
Price—$2 per share.
Underwriter—.
Koellmer & Gunther, Newark, N. J. Proceeds—To com¬
plete films in progress and for general corporate pur¬
poses.
Office—321 So. Beverly Drive, Beverly Hills,

Aug. 31

Aug. 30 (letter of notification) 2,000 shares of 5% cumu¬

of

bank loans.

•

Pioneer

working capital.

State¬

Ohio Oil & Gas Co.

None.

Proceeds—For

the rate of

June

ment

finance

.

underwriter

Probable

Securities

.Underwriter—Robert

share

Coal

Corp., Chicago
May 10 (letter of notification) up to 2,000 shares of
common stock
(no par) to be sold at the market price
(between $20 and $22 per share) by T. Howard Green,
a Vice-President of
the company.
Underwriter—Faroll
& Co., Rogers & Tracy and Shields & Co., Chicago.

share.

shares of common stock (no par).
certificates, $400 each; for stock, $1 per
D. Bowers & Co., Denver.

30,000

and

Price—For

writer

Nash-Finch

stock.

each)

Co.

stock

capital.

Calif.

•

Co., Denver, Colo.
notification) $150,000 of 5^2% de¬
due 1955 (in denominations of $500

of

(letter

and two shares

lantic Avenue, Brooklyn 7, N. Y.
•

To

10

benture certificates

City, N. M.

preferred stock

Monarch

Perlite Mines

Aug.

cumu¬

common

0

—

•

1,250 shares of common

per

construct

Pan American Gold Ltd., Toronto, Canada
July 20, 1948 filed 1,983,295 shares of common stock (par
$1). Underwriters may be brokers.
Price—45 cents per
thare.
Proceeds
Mainly for development. Statement
effective April 10, 1950.

.

series B cumulative con¬
$100). Underwriter—East¬
man, Dillon & Co., New York.
Price—To be filed by
amendment along with dividend rate. Proceeds—To in¬
crease working capital and for other corporate purposes,
including the erection of a new plant at Anderson, Calif.
Temporarily postponed.
vertible preferred stock (par

Utah Power & Light Co. (10/9)
/
Aug. 2 filed $8,000,000 first mortgage bonds due 1980.
by competitive bidding.

Underwriters—To be determined

Probable

bidders:

Halsey,

Stuart & Co. Inc>; Lehman
(jointly); ..Union Secur¬
(jointly)^ First Bosr

Brothers and Bear, Stearns & Co.

ities Corp. and Smith, Barney & Co.

.

Volume 172

Number 4942

.

.

.

The Commercial and Financial Chronicle

ton Corp. and Blyth & Co., Inc.; Harriman Ripley & Co.,
Inc.; Kidder, Peabody & Co.; White, Weld & Co.; Salo¬

Bros.

mon

Oct. 9.

Proceeds—For

construction
up

to

pro¬

(EST)

noon

Utah

Power &

offered

to

basis of

one

Light Co.

166.604 shares

share for each

new

Oct.

on

common

stockholders

common

expire

of

4.

of

ment effective

stock

record

par)

(no

Sept.

12

on

eight shares held; rights

Underwriters—Union

Securities

Aug. 30.

......

Vieh Co., Columbus, Ohio

May 8 (letter of notification) 19,500 shares of commoD
stock at $10 per share. Underwriter—The Ohio Co. Pro¬
ceeds—To buy the assets of Brodhead-Garrett Co. and
for working capital.

of notification)

(letter

stock

(no

None

Proceeds—For general

Price—$25

par).

5,000 shares of

per

share.

common

Underwriter—

corporate purposes.

West

Disinfecting Co.
(letter of notification) 3,000 shares of

July 25

common

stock

(par 50 cents). Price—At market (about $10 per
share). Underwriter—Coffin & Burr, Inc., New York.
Proceeds—To

selling

stockholder.

Office—42-16

West

Street, Long Island City, N. Y.
Western Carolina
June

22

are

Telephone Co., Franklin, N. C.

stock to be offered

shares

1,406

to stockholders at rate of

capital

of

one

share

for each two shares held. Price—At par ($50 per share).
Underwriter—None. Proceeds—To pay bank loans.
Western

Uranium Cobalt Mines, Ltd.,
Vancouver, B. C., Canada
Feb. 28 filed 800,000 shares of common capital stock
(par $1). Price—35 cents per share. Underwriter—None
Proceeds—Exploration and development work. State¬
ment effective May 23.
Winn & Lovett Grocery Co.
(9/26)
Sept. 6 filed 210,000 shares of common stock (par $1).
Price—To be filed by amendment.
Underwriter—Mer¬
rill

Lynch, Pierce, Fenner & Beane, New York. Proceeds
general corporate purposes, including improve¬
ment and expansion of its stores and other facilities and
prepayment of a portion of outstanding funded debt.
—For

'

J

i

Prospective Offerings

•

I.

.

.

•

"

Alabama

Sept.
SEC

it

1

■

,

•?

'

1

the next four

&

Co.

'

announced

has

company

filed

with

the

by

competitive bidding.
Probable bidders:
Morgan
Stanley & Co.; Blyth & Co., Inc.; Union Securities Corp.
and Equitable Securities Corp.
(jointly); First Boston
Corp. Proceeds—For construction program.
Investment Co. of

Illinois

May 24 announced company is planning to file shortly
registration statement covering 160,000 shares of prior
preferred stock (par $50). Price—To be filed by amend¬
ment. Underwriters—Glore, Forgan & Co.; Kidder, Peabody & Co., and Alex. Brown & Sons, and others. Pro¬
ceeds—For additional working capital.

a

Associated Telephone

Co., Ltd.
plans to sell in
October $6,000,000 of first mortgage bonds, series G.
Underwriters—To be determined by competitive bidding.

Aug. 28

it

was

&

Co.

and

the

reported

Probable bidders:

Stanley

&

Co.;

Long Island Lighting Co.
Aug. 29 company asked SEC authority to issue $20,000,000 first mortgage
bonds, series H, due Sept. 1, 1980,
and requested exemption from
competitive bidding, plan¬
ning to place the issue privately. Proceeds would be used
to repay bank loans and to reimburse
treasury for con¬

First

struction

Consolidated

Lorillard

(P.) Co.
April 4, Herbert A. Kent, President, said: 'It may bo
necessary to do some financing" before Aug. 1, 1951 to
redeem $6,195,450 of 5% bonds due on that
date ard'
for

May 23 it

Utilities Associates

was

a

new

issue

will

and of the Brockton Edison Co., Fall
Light Co. and Montaup Electric Co. and

sell

•

$22,000,000 of first mortgage and
$8,500,000 of preferred stock

El

company

Halsey, Stuart & Co. Inc.; Kuhn, Loeb
Bros. & Hutzler (jointly); Lehman

Co., El Paso, Tex.
announced company plans to refund $3,500.000 bank loans (notes approved Aug. 22 by FPC)
with
permanent financing prior to
March 31,
1951,

(jointly); Equitable Securities Corp. and Harris, Hall &
Proceeds—For construction program.

Co. (Inc.) (jointly).

to *meet expanded

Power

&

Light Co.

was

—

maturity date. The last issue of debentures was
placed privately last September with the John Hancock

Brothers

by White, Weld & Co.

(jointly);
Co., Inc.; Shields
ly); Salomon Bros.
First Boston Corp.

Elliott Co.

Proceeds—For construction
program.

Mutual Life Insurance Co. Previous
ten

salet

company

petitive bidding. Probable bidders: Halsey, Stuart & Co.
Inc.; Merrill Lynch, Pierce, Fenner & Beane and Kidder,
Peabody & Co. (jointly); Kuhn, Loeb & Co. and Lehman

was

their

Blyth & Co., Inc.; Harriman, Ripley
& Co. and White, Weld & Co. (joint¬
& Hutzler; W. C. Langley & Co.. The
and Glore, Forgan & Co. (jointly).

&

financing underwrit¬

Louisville Gas

May 26 it was reported that between 47,000 and 48,000

&

Electric

Co.

shares of this company's common stock may be offered
some time
in the near futuer through F. Eberstadt &

Aug. 29, SEC was notified that Standard Gas & Electric
Co. plans to sell its holdings of
137,857 shares of com¬

Co.

mon

stock (no par) of Louisville Gas & Electric

use

the

Radio

&

to

bidders:

retire

Lehman

Securities Corp.

(jointly).

be offered to California
less

the

was

of

stock.

common

Previous

Macy
May 8 it
ance

company

are

to

be offered to

(R. H.)

& Co.

t

k.

reported that company is considering
of $10,000,000 of new
securities, either debenture#*
was

Lehmm

—

Market Basket, Los Angeles, Calif.
May 25 company announced it plans sale of 4,452 share*)
of authorized but unissued, preferred
stock, series C*
(par $15) and an additional 30,000 shares of preferred

appli¬

(par $15)

to

be authorized.

Further details toil

available.

reported Alabama P. S.

the

stockholders at $2.50 per share*
rights are exercised within CD

preferred stock. Traditional underwriters
Brothers; Goldman, Sachs & £o.

Power Co.

was

if

or

Commission has
issue a new series of pre¬
ferred stock, the proceeds of which are to be used to
finance the erection of a steam generating station at
Sept. 6 it

authorized

discount

The remaining 50,000 shares

stock,

Georgia

Expected before end of 1950.

bona fide California residents at
$3 per share.

withdrawn.

sale

10%

a

days.

Georgia Natural Gas Co., Albany, Ga.
jAug. 2 filed new application with FPC for authority to
construct a 335-mile pipeline system
in Georgia and
Florida to cost about $5,100,000, which would be fi¬
nanced
through issuance of first mortgage pipe-line
and

notes.

&

Loyal Automobile Insurance Co., Los Angeles
Aug. 14 company applied to California State Insurance
Department for authority to issue a total of 100,000 share*
of capital stock (par $1), of which
50,000 shares are to

Light Co.
June 9 stockholders approved creation of 50,000 shares
of $4.50 cumulative preferred stock (par $100).
These
shares are soon expected to be offered to finance part of
construction program which is expected to require ap¬
proximately $25,000,000 new capital through 1952.

bonds

Co., and

bank

Blyth

Co.,
(jointly); First Boston Corp.; Glore, Forgan & Co.
W.
C. Langley
& Co.
(jointly); Merrill Lynch,
Pearse, Fenner & Beane, White, Weld & Co. and Union.

Power &

cation

of

and

and

Traditional underwriter: F. Eberstadt & Co.

Florida

$2,250,000
Brothers

Inc.

program.

•

proceeds

Probable

Equitable Gas Co.
April 8 company said to be planning the sale this year of
$2,000,000 of bonds, with another $2,000,000 in 1951 or
1952. The proceeds are to be used for its construction

Salomon

Brothers; Paine, Webber, Jackson & Curtis and Stone &
Webster Securities Corp. (jointly); White, Weld & Co.,
Kidder, Peabody & Co. and Shuman-Agnew & Co.

that

said that the company is expected to be
in the market for
nearly $10,000,000 of bonds around midNovember. Underwriters
To be determined by com¬

Electric

Paso

working capital

added

Louisiana

Sept. 12 it

collateral trust bonds and

July 19 it

He

plans to pay off 11*
bank loans in full by July, 1950. These loans now amount,
to $12,000,000.
Traditional underwriters: Lehman Brc*t
and Smith, Barney & Co.

announced that under a plan filed with
company will be formed to acquire the

and

additional

volume.

assets of Eastern,

River Electric

expenditures.

Lobster Co.,

Inc.
Aug. 11 it was stated that company plans to offer addi¬
tional capital stock (no par) for subscription by stock¬
holders.
At April 30, 1950 there were outstanding 34,393 shares out of 47,000 shares authorized.
Eastern

uasr-

derwriter:

Probable bidders: Hal¬

years.

Morgan

temporary advances for construction. Probable
Paine, Webber Jackson & Curtis.

pay

Boston Corp.

needed.

1

ferred stock (par $100).

American

Inc.;

Telephone Co.

repay $1,300,006
loans, due in September, 1951, and the remaining
go to Central Telephone Co., parent, to re¬

bank

that $257,000,000 will be needed for the construction pro¬
over

Corp. is reported to be head¬

group.

$300,000 will

Phonograph Corp.
May 29, Benjamin Abrams, President, announced that
company may use unissued 1,240,390 shares of capital
stock (par $5) to acquire additional plant facilities if

application covering an issue of $10,000,000 pre¬
Underwriter—To be determined

an

La Crosse

Consolidated Edison Co. of New York, Inc.
May 15, Ralph H. Tapscott, Chairman, said the company
will require approximately $90,000,000 of "new money'
through the sale of securities. No permanent financing is
contemplated before this fall, however, and current ex¬
penditures are being financed by short-term loans, of
which $16,000,000 are now outstanding.
It is anticipated

Stuart

Proceeds

June 6, company announced that it has advised the
Wis¬
consin P. S. Commission that it
expects to sell $1,000,006
of long-term bonds and not less than
$600,000 additional
common stock.
Proceeds will be used to

Co.

Power

was

'

!,

_

ing the underwriting

outstanding bond issues and the
expansion and construction.

balance for plant

Emerson

'

writer—The First Boston

Co.

be used to redeem three

the SEC

notification)

(letter of

Power

Aug. 31 company announced stockholders will vote Sept.
18 on approving an issue of $10,000,000 new bonds, which
may be placed privately. Of the proceeds, $7,200,000 will

sey,

Mass.

expected to De Hied with the SEC before Oct. 6.

41

—$92,000,000 will be used to pay off an RFC loan, and the
remaining $8,000,000 added to working capital. Under¬

to be used for construction program. Probable
underwriter: Dillon, Read & Co. Inc. if negotiated sale.

ceeds

gram

Vineyard Shellfish Co., Inc., West Tisbury,

Sept. 5

April 25 having increased the authorized
750,000 shares from 500,000 shares. The pro¬

on

Connecticut

Corp. and Smith, Barney & Co. (jointly). Price—$24.25
per share.
Proceeds—For construction program. State¬

•

holders

amount to

Statement effective Aug. 30.

Aug. 2 filed

will

Hutzler.

Bids—Expected to be received

gram.
on

&

(1025)

Michigan Bumper Corp., Grand Rapids, Mick,.
July 20 stockholders voted to increase authorized com¬
mon stock (par $1) from
250,000 shares to 500,000 shares

to

Gorgas, Ala.

'

with holders of present
-

-

outstanding stock to have

no

pre¬

emptive rights.

Houston

California

Electric

Power Co.

Aug. 31 company filed application with FPC for author¬

issue 40,000 shares of 5% cumulative preferred
stock (par $50). Exemption is sought from competitive
ity

to

bidding requirements.
with

a

It is planned to place this issue

small group of insurance companies through Mer¬

rill Lynch,

Pierce, Fenner & Beane.

Proceeds

are to

be

used to finance expansion program.

Lighting & Power Co.
,ynm
April 14, S. R. Bertrop, President, estimated*construction
expenditures for 1950 between $19,000,000 and $20,000*000.
This estimate may be raised to accommodate increased
power demands on the system.
If this is the case, more
financing will be necessary, he added.
This may be

done

•

Central States

Electric

Corp.
announced that under

of

unit consisting of eight shares of new common
stock and $14 principal amount of new 4V2% income de¬
bentures for a package price of $18. The common stock,
to

buy

a

except for approximately 4,600,000 shares held by Harri¬
son

to

Williams and associates, would be offered the right

buy

income

five

unit of one new common share and $1.75 of new
debentures for a package price of $2.25 for each

a

common

shares held.

The

issue

of

new

debentures would be underwritten by Darien

stock

Corp. and

banking group headed by Hemphill Noyes, Graham.
Shields & Co., Blair, Rollins & Co., Drexel
& Co. and Sterling Grace Co.
Parsons & Co.,

Chenango & Unadilla Telephone

Co.

July 17 company applied to New York P. S. Commission
for authority to issue $1,000,000 of mortgage bonds, $357,000 of preferred stock and $300,000 of common stock.
Electric

Illuminating Co.

Aug. 1 it Was reported that company this fall may issue
and sell an issue of preferred stock, of which 495,011
shares

of

no

par

value

are




preferred

or

stock

Refrigerator Co.

on creating a new issue of
Proceeds will be used to redeem 15,699
outstanding shares of $2.25 cumulative preferred stock,

preferred stock.
no

par

presently available, stock¬

value, and for general corporate

purposes.

Tra¬

ditional underwriter—W. E. Hu.tton & Co.

Southern

Iowa

it was announced company contemplates per¬
financing will be consummated before maturity
(Feb. 20, 1951) of proposed $25,000,000 bank loans whiib.
will include, during 1950, $20,000,000 of first
mortgage
bonds and $6,000,000 of common stock, and the
sale, in
1951, of about $10,000,000 of preferred stock. Under¬
7

manent

writers

Hussman

Utilities Co.

company

gram for

1950.

for Bonds—To be determined by
competitive
bidding. Probable bidders: Halsey, Stuart & Co. Int.;
White, Weld & Co. and Lehman Brothers (jointly);
Smith, Barney & Co. and Blyth & Co., Inc. (jointly). Pro¬
ceeds—To pay off short-term bank loans and for mw

construction costs.

The additional

sold to American Natural Gas

stock will fce

common

Co., parent.

Expected thin
1

Fail.

said to plan sale of first mortgage
bonds to finance part of its $3,200,000 construction pro¬

April 26

Probable underwriter:

The First Boston

Michigan-Wisconsin Pipe

Line Co.

July 25
more

company received SEC authority to borrow reti
than $26,000,000 from banks. A permanent financ¬

ing program provides for the elimination of these barJfc

Corp.

loans

and

a

Cleveland

common

Oct. 6 stockholders will vote

was
an amended plan
reorganization it is proposed to issue to holders of all
classes of 6% preferred stock for each old share the right

March 1 it

additional

through

financing.

Michigan Consolidated Gas Co.
Aug.

Johansen

Oct.
sell

25

Brothers

stockholders

$350,000

of

4%

will

Shoe
vote

sinking

Co.
on

proposal to issue and

fund debentures due 1960.
3M>% debentures and for

Proceeds to retire outstanding
other

corporate purposes.

Nicolaus
•

Traditional underwriter: Stifel,

& Co.

Kaiser

6

it

Steel

Corp.,

Fontana, Calif.

was

financing which is expected to be in
and

common

stock,

MidSouth

a

units of preferred
registration statement for which is

Gas

Co.

announced that this newly organized
company may issue and' sell publicly $2,800,000 of com¬
mon stock and place privately with institutional investors
July

reported that company'ZJvas planning a
$100,000,000 financing program, which may include $60,000,000 of bonds (which probably will be placed privately
with an insurance company) and $40,000,000 of equity
Sept.

prior to their maturity, July 1, 1951, and such pro¬
will include the issuance and sale of $12,000,0CC
additional bonds and $3,000,000 of additional comrrcn
stock.
Previous debt financing was placed privately.
gram

31

it

was

first mortgage- bonds, the
proceeds to'be!used'inrconnection with the acquisition
of1 the gas'distribution properties of Arkansas PoWer &
$6,900,000 ;afl<20^year ,3%%

Initially it is planned to sell $800,000 stock and

Light Co.
I

Continued

on

page

42

42

The Commercial and Financial Chronicle

(1026)

Continued
$1,500,000

from

of

page

increase

to

Underwriter for Stock—Equitable
& Sons and Womeldorff &

bonds.

Securities Corp., T. J. Raney

Pacific

Gas

Light Co.

applied to SEC for authority to issue
$3,500,000 promissory notes to banks to mature April 27,
1951, the proceeds to be used for construction purposes.
The permanent financing program is expected to be con¬
summated prior to October, 1950 and will involve the re¬
financing of $13,334,000 first mortgage 4 J4% bonds due
1967, $2,000,000 of 7% preferred stock and bank loans
(about $8,500,000) through the issuance of $27,000,000 of
bonds, and $6,000,000 of preferred stock (to be offered
publicly and $3,000,000 of common stock to common
stockholders.
(American Natural Gas Co. now owns
97.7% of presently outstanding common stock.) Probable
bidders for bonds: Halsev. Stuart & Co. Inc.; Glore, ForAug. 22

company

& Co., and Lehman Brothers (jointly); Kidder, Peabody & Co.; Harriman Ripley & Co.; Smith, Barney &
Co., Kuhn, Loeb & Co. and Blyth & Co., Inc. (jointly).
Registration expected shortly.

in

investment

vania Power Co., a
or about Oct.
11.

Lindsay.
Milwaukee

Proceeds—For construction

Forgan & Co.

41

common

program

stock

of

subsidiary.. Bids—To be received

Northwest

Pipeline

on

Corp.

June 30 company sought FPC authority to build a 2,175
mile pipeline system—from southern Texas to Washing¬
ton—at a cost of $174,186,602.
Negotiations for rnajoi

financing

requirements

are

in

now

process

of

being

completed.
Packard-Bell

Aug. 2 it
ot

increase

an

Co.

in

the

authorized

common

on

Aug. 25

stock

&

Co.

Montana

Panama

Aug. 22 it was reported

plans to sell in 1950

company

approximately $22,000,000 of new securities,
with $10,000,000 of debentures
expected in October.
Underwriters—To be determined by competitive bidding.
Probable bidders for bonds: Halsey, Stuart & Co. Inc.;
1951

and

Blyth & Co., Inc.; Union Securities Corp.; Merrill Lynch,
Pierce, Fenner & Beane; Smith, Barney & Co.; First
Boston Corp.; Lehman Brothers.
Proceeds—For expan¬
sion and extension of gas and electric properties.
Mountain

plans to create a new firm
its exploration and development of natural

June 6 company announced
to take over

and oil operations. It will be financed, in part,
through public sale by the new unit of 1,000,000 shares of
capital stock (par $8). Financing plan submitted by First
Boston Corp. Expected this Fall.
gas

•

Mountain

Aug.

it

23

States

issuance of additional
there

are

Power Co.

is considering
preferred stock (par $50), of which

reported

was

that company

authorized and unissued 77,007 shares.

Under¬

writer—May be Merrill Lynch, Pierce, Fenner & Beane.
Proceeds—To retire $1,250 000 bank loans maturing Oct.

Light Co.

(9/27)

authority to issue
and sell 10,631 additional shares of common stock (par
$25) and $3,750,000 of 25-year notes, series B, due 1975,

Aug. 9 company applied to SEC for

the latter at competitive

bidding, with probable bidders

including Halsey, Stuart & Co. Inc.; Coffin & Burr and

(jointly); Kidder, Peabody & Co.;
Harriman Ripley & Co., Inc.; First Boston Corp.; Whiting,
Weeks & Stubbs. The common stock is to be offered for
subscription by common stockholders at $67.50 per share,
with New England Gas and Electric Association, parent,
taking any unsubscribed shares. Proceeds from stock sale
will reimburse Plant Replacement Fund Assets for con¬
struction expenditures, while proceeds from sale of notes
will repay a like amount of bank loans.
F. S. Moseley

New

& Co.

April 24 it was estimated that about $37,000,000 new
financing will be required to pay construction cost«
for 1950 to 1952. Present plant
are
to issue in late summer or early fall $10,000,006
bonds and 50,000 shares of preferred stock.
Probable
bidders:
(1) For bonds—Halsey, Stuart & Co., Inc.
(2) for bonds* and preferred: Harriman Ripley & Co.
Lehman Brothers; Kidder, Peabody & Co.; First
Corp.; Merrill Lynch, Pierce, Fenner & Beane;
(3) for preferred:—W. C. Langley & Co.

Inc.;

Boston

Philadelphia
May 5 it

be used

as

follows: $25,000,000

to pay construction costs

$16,000,000 to refund Niagara Falls Power Co. 3^%
(latter amount is dependent upon approval by

bonds

FPC of merger of Niagara Falls Power Co. with

Niagara

underwritten
be

A,

Electric

bunds, to be used to
due 1994, and 3V2%

Co.

by Drexel & Co.

competitive,

negotiated

Bond financing
would be

preferred

and

would

stock

Southern

North American

Car Corp.

Aug. 15 it was reported that the company is to issue and
sell publicly not exceeding 40,000 shares of common
stock (par $10).
Probable underwriter: Glore, Forgan
& Co., New York. The proceeds are to be used for car
rebuilding program.
Northern

States

Power

Co.

(Minn.)

000,000

and

Riter

&

Proceeds would

Ohio

Sept. 1 it

Co.

be

(jointly);

used

Edison Co.

for

new

Smith,

Barney

& Co.

construction.

(10/11)

was announced company

plans to issue and sell
396,571 shares of common stock (par $8) for subscription
to common stockholders of record Oct. 11, 1950 on basis
of one share for each 10 shares held, with an oversub¬
scription privilege; rights expiring on Oct. 30, 1950. SEC
approval was sought on Sept. 5. Price—To be later deter¬
mined by company. Underwriters—To be determined by
competitive bidding, t robable bidders: Morgan Stanley
8c Co.; First Boston Corp.; Lehman Brothers and Bear,
Stearns & Co. (jointly); Merrill Lynch, Pierce, Fenner
& Beane

and

Kidder, Peabody & Co.




(jointly); Glore,

first

31

it

series T.

Probable

of

company may in near
trust certificates,

equipment

bidders:

Halsey, Stuart & Co., Inc.;
Harris, Hall & Co. (Inc.).

Salomon Bros. & Hutzler;

initially and the balance later

for

construction

$32,520,000

Republic Natural Gas Co.

Sept. 9 it

was

to 11

(EDT)

a.m.

Co.

&

announced

that

bids

will be

received up

on

only.

9

stockholders

no

authorized

common

The corporation

intention of issuing any of the additional shares
Traditional underwriters: Lehman Brothers

July 20

estimated

to

cost

bidders:

Public Service Co.

announced by Herbert L. Nichols, Chair¬
the company expects to raise between $17,-

(Ont.)f Canada

vides for
The

borrowing at
debentures

new

with

institutional

interest rate of 2.84%.
placed privately last week
through a banking group
Securities Corp. and Harriman

an average
were

investors

headed
by Dominion
Ripley & Co., Inc.

United Gas

Pipe Line Co.

lines

in Texas, Louisiana and Mississippi at a
$110,000,000, including new facilities. It is
probable that the bulk of this new capital will be raised
through the public sale of new securities.
new

cost of about

Natural

mile

was

22-inch

$25,000,000.

Gas Co.

announced company

pipe

line

P. S. Commission in

of

the

plans to build

in

Utah

to

will

Hearings

be

held

August

or

cost

a

325-

approximately

before

the

September, after

a

Utah

study

project.

.

Valley Gas Pipe Line Co., Inc., Houston, Tex.
sought FPC authorization to construct
$144,500,000 pipeline project to carry natural gas from
Gulf

San

issue

is now in process of completing
its major financing requirements.

Brothers

and Bear, Stearns & Co.
(jointly);
Corp.; White, Weld & Co. and Shields &
Co. (jointly); Merrill Lynch,
Pierce, Fenner & Beane;
Union Securities Corp.; Salomon Bros. &
Hutzler. Pro¬
go

toward

construction

program.

tiations are

of

the

to

the highest bidder by the Office of Alien
Probable bidders: A. G. Becker & Co.
(Inc.),
Ladenburg, Thalmann & Co!
(jointly); Merrill Lynch, Pierce, Fenner & Beane; Kid¬

der, Peabody & Co.; F. Eberstadt & Co.; Allen & Co.;
new company to be formed
by United States & Inter¬
national Securities Corp.; Dillon, Read &
Co.; F. S. Mose¬
ley & Co.; Riter & Co.
South Carolina

bonds (in addition to

private placement of $3,000,000
of 4.60% cumulative preferred
stock, par $50), the pro¬

Boston

Corp.

construction

Halsey,

and

to offer publicly
Underwriting nego¬

with Kidder, Peabody & Co.

for modernization

properties.

Expected

and

expansion
beginning of

October.

20

Warner

change
&

Co.,

in

company's

Inc.

name

from

William

R.

approved, but no action was
proposed recapitalization plan, due to market
conditions. It is planned to file a registration with the
SEC covering the sale of approximately 325,000 shares
of the proposed new common stock (par $1) to the pub¬
lic through a nation-wide group of underwriters headed
by F. Eberstadt & Co., Inc.
taken

•

was

on

Washington Water

Sept. 8 it

was

reported

Power Co.

that Washington P.
a

S. Commis¬

request that company

Western

program.

Stuart

Lehman

&

Co.

Brothers

Probable

bid¬

Inc.; The First

(jointly); Kidder,

Peabody & Co.; Union Securities Corp.

Pacific

RR.

July 17 it was reported company plans issuance and sale
of $22,000,000 mortgage bonds. Probable bidders: Hal¬
sey, Stuart & Co. Inc.; Blyth & Co., Inc.; Lehman Bro¬
thers and Bear, Stearns & Co. (jointly); Union Securities

Corp. and Glore, Forgan & Co.
retire

first

(jointly).

Proceeds—To

mortgage 4% bonds and convertible income

4*4% bonds due 2014, and over $5,000,000 "new money."
Expected

Electric & Gas Co.

Aug. 17, S. C. McMeekin, President, said the company
expects to issue and sell later this year $3,000,000 of

bonds:

(10/4)

plans

com¬

Property.

finance

used

negotiations for

its construction program
involving $11,000,000 of short-term bank loans.
company's entire

Union Securities Corp. and

to

be

company's

on

and

Com¬

sell preferred stock to carry out

was announced that the

stock issue (440,000 shares) was
expected to be
registered with the SEC in the near future and offered

for

being carried

Proceeds will

mon

sale

announced

company

sion has taken under advisement

Sobering Corp.
May 4, it

Louisiana

Warner-Hudnut, Inc.

Boston

would

21

July

reported that the company's original plan
between $8,000,000 and
$10,000,000 of bonds
was

September or early October may be changed to
preferred stock, depending upon market conditions. If
negotiated, Blyth & Co., Inc. may handle financing. If
competitive, probable bidders are: Blyth & Co., Inc.;

ceeds

in

closely held.

are

late in

Lehman

fields

$5,000,000 of convertible debentures.

Diego Gas & Electric Co.

July 31 it

off-shore

pany

Aug.

Inc., Manchester, Conn.

company was

stock, which

and

Coast

Texas to markets in Indiana, Ohio and Michigan.

Vanadium Corp. of America

Mills,

reported to be negotiating with a
group of underwriters for a public stock offering of
about $150,000 of additional capital stock at
$1 or $2
per share. There are presently outstanding
1,381 shares

ders

is

Probable

United States of $15,000,000 debentures to provide funds
for construction of Toronto's subway. The proposal
pro¬

Reynolds & Co.
Roosevelt

ceeds

1950-1951.

500,000 and $18,000,000 through the sale of securities
during the fiscal year beginning Sept. 1, 1950. This may
include bonds to be placed privately and the balance
to be offered publicly as preferred and common stock
with Dillon, Read & Co. Inc. underwriting. The
proceeds
are to pay for construction costs.

the
the

2,500,000 shares.

at this time.

new

21

was

that

man,

a

increased

stock from 1,500,000 to

to

may

June

June 27 company

Reynolds Metals Co.

of

which

program

for

Southwestern

Aug. 1 it

represents about 2% of the 1,450,693 common shares out¬
standing. The stock will be sold to American citizens

and

On

Halsey,
Inc.; Blyth & Co., Inc. and Kidder, Peabody
(jointly); First Boston Corp.

June 5 it

Sept. 28 at the Office of Alien Prop¬
erty, 120 Broadway, N. Y. City, for the purchase from it,
as
an
entirety, of 3,000 shares of common stock. This

has

company

on.

Stuart & Co.

Utah
•

although

pieces, viz: $10,000,000 to $12,-

temporary bank borrowings of up to $20,000,000 to mature July 1, 1951, the proceeds to be used

of

that

reported
issue

an

bonds,

July 25 filed with FPC for authority to build 1,130 miles

was

sell

reported proposed financing on a perma¬
been increased from $10,000,000 to
$24,-

mortgage

Toronto

Reading Co.

for

July 29 it was reported that the company will be in the
market probably this fall with an
offering of $17,500,000
new preferred stock.
Probable bidders: Lehman Broth¬

basis has

nent

July 25 the Board of Control authorized the sale in the

bonds due 1972.
Probable bidders: Halsey Stuart & Co.
Inc.; Morgan Stanley & Co. and Drexel & Co. (jointly);
Kuhn, Loeb & Co. and Lehman Brothers (jointly); First
Boston Corp.

future

Natural Gas Co.

was

either

April 17 stockholders approved the issuance of $90,000,000 new bonds for the purpose of refunding $50,000000 3V8% bonds due
1965; $10,000,000 3y4% bonds due
1968; $15,000,000 3% bonds due 1970 and $15,000,000

July

July 31 it

competitive.

or

Public Service Electric & Gas Co.

First

Mohawk Power Co.)

ers

series

said that there will be additional financing

was

Corp.

ing for additional capital stock, the proceeds to be used
develop the company's Cuyama Valley holdings. The
offering would be underwritten.

total of

a

Petroleum

1, Tyler F. Woodward, President, announced that
stockholders should be given the opportunity of subscrib¬

Niagara Mohawk Power Co.

Sept. 7 it was reported company plans issuance of $41,000,000 new bonds some time in November. Probable
bidders: Halsey Stuart & Co. Inc.; Morgan Stanley & Co.;
Kuhn, Loeb & Co.; First Boston Corp. Proceeds would
and

treasury

due 1967, and 5% bonds due 1963, of
approximately $15,000,000 are outstand¬
ing. The new 3% bonds are expected to be placed with a
small group of institutional investors, and are to be se¬
cured
by the $430,000 annuity annually paid by the
United States to the Republic.

Aug.

England Power Co.

estimated at $40,000,000

•

3% bonds

series B,

bonds,

which

3, 1950, and for expansion program.
New Bedford Gas & Edison

new

later this year, with probably some common stock to be

Supply Co. of Utah

Fuel

together with
314% bonds,

the

California

Sept.

SEC approved

reported that $10,500,000 of

due 1996 would be issued through Lehman Brothers, the
retire

Probable underwriter: Courts & Co.

Southern

000,000

(Republic of)

was

proceeds,

Power Co.

ities.

decide to take this in two

gan

Aug. 18 it

Georgia Natural Gas Co., Atlanta, Ga.

from

1,200,000 shares, par 50 cents,
to be followed by a two-for-one split-up, the company
may issue additional common stock for the purpose of
raising additional working capital. Traditional under¬
Cruttenden

Thursday, September 14, 1950

.

Aug. 23 company applied with FPC an amended applica¬
tion for authority to build a 526.9 miles
pipe line in
Georgia and Florida which, it is estimated, will cost be¬
tween $10,500,000 and $12,080,000 to be financed
by sale
of first mortgage bonds and the issuance of
junior secur¬

500,000 shares, par $1, to

writer:

.

to

stated that following approval

was

South

and

Pennsyl¬

.

about

middle

of November.

Wilcox-Gay-Majestic Corp.
July 14 it

was

sition by

Wilcox-Gay Corp. of Garod Radio Corp. and

announced that in connection with acqui¬

Majestic Radio & Television, Inc., Wilcox-Gay-Majestic
Corp., the new company plans public offering of 500,000
shares of
hart

common

Kinnard

&

stock

Otis.

Expected in October.

(par $1).

Underwriter—Gear-

Proteeds—For

working

capital.

Volume 172

Number 4942

..

The Commercial and Financial Chronicle

.

out

to

decimals

three

casion at 101.099 for
The

winner

101.10

for

made

the

this

on

3%

a

flat

a

bid

interest

same

oc¬

coupon.

of

at

a

from the next

ceived,
move

rate.

Brought out for public offering
price of 101% to yield 2.884%,

(1027)

that

2,000,000 shares in the U. S. and

re¬

slow

was

the balance in Canada.

to

reoffering.

upon

The

for

highest of four
issue

highest

bid

looking for
$10 a share.

was

100.33317

was

2%% interest rate while the

a

lowest

100.035

was

for

the

Mexico Recipient of

The Street

price of around

a

$150 Million Credit

New Issues Coming Up

same

The

Two New England utilities are
fairly good re¬ coupon. The successful group re¬
ception and were reported better priced the bonds at 100% for mar¬ seeking bids on securities to be
than 60% sold at the end of the keting with an indicated yield of opened late this month. New Eng¬
the

bonds

met

better than

Conflicting Trends Noted
The

underwriting

vived

on

While

re¬

been

with quite

corporate

coming

regaining its

market

market has

seasoned

still

side and
bit

bit

a

the
the

on

for

19

uneasy

buyers leaning toward

Public

Service

vited tenders, to

general

260,000

shares

Maine Power Co.

a

New

Co.

has

of

individual credits

on

lished

Central

Hampshire

Electric

will receive bids to be opened on
the

down again, not all of the interest
market, chiefly via the com¬
was in the buying side of the mar¬
petitive bidding route.
ket.
And investment bankers, their
Quite to the contrary there was
appetites semingly whetted by the
an
apparent tendency in some
recent long spell of inactivity, ap¬
quarters toward liquidation and
peared to be thinking pretty much
this among some of the better type
along the same lines in the matter
corporate obligations, according to
of pricing for the new securities.
the

were re¬

ported moving out slowly.

Unless

there

is

in

hitch

a

ported plans, it looks

mission.

up

ment will be

first

new

bonds

mortgage

of

will

opened early
veloped that

Transmission

Gas

advantage¬

more

It

the

is

under

holder

lease

Manitoba

Virginia Elecs Sticky

large

in

MANATI

CORPORATION

finance

Directors

of

of

dividend

annual

25

at

close

the

cents

per

a

share

M.

FOX,

on

the

Treasurer.

1950.

15,

is

Due

NOTICE

September

PAYMENT

OF

30,

1969

A

Association
to

undersigned

New

York

N.

15,

1950,

29,

22,

close

12

said

with

the

15,

of

for

Stock

Ordinary

September

for each
United

payable

of

dividend

this

Income

Bearer

208

the

with

of

New

be

will

Tax

1950.

Stock

holders

Guaranty Trust Company
32
Lombard
Street,

London, E.C.3., for examination five clear

of

before
I

days

York

120

Sep¬

on

&

Broadway,

The

usual

York

New

No.

5,

N.

dividend

half-yearly

of

on

September next will also be payable
the

29th

September

on

1950.

Provincial

National

examination

1950.

of

Company,

this

the

receive,

Cents ($.70) a share, on the outstand¬
capital stock of this Company, payable on
30, 1950, to stockholders of record

of

common

stock

declared

35c

holders

of

ing

tember

29,

the

close of business on
w.

C.

(excluding
is

Saturday)

business

before

days

payment

made.

SIMON

July

28,

of

for

Court

BY
A. D.
Rusham

September

of

in
M.

-

OLD TOWN

-

GONZALEZ,

RIBBON & CARBON

1950.

11,

WAGNER BAKING
CORPORATION
Board

Treaty

and

credit

tax

XIII(13

the

under

the

Section

131

to

giving

New

York

particulars

obtain
of

Potash

*

Fertilizer

r. s

of

the
can

rates

certificates
of

United

Kingdom Income Tax appropriate to all

Preferred Stock, also
10 cents per share
Stock of this

the 7%

dividend of
the

on

Common

payable

stockholders of record September

1950.

22,

V.

J.

above

mentioned

dividends.




Secretary.

STEVENS,

••

Chemicals

•

were

declared by the

Board of Directors

September 7, 1950,

as

on

of 50

cents

4% Cumulative Preferred Stock
34th Consecutive Regular

per

QOOtk

$5.00 Par Value Common Stock

Regular Quarterly Dividend of

cents

cash

per

record

dividend

of

share on the
payable Octo¬

1950 to shareholders of
September 19, 1950.

Eighty Cents

(80£)

are

per

The

share.

the close of business

Accumulated

the

fifty

($.50)

cents

September

share on the
payable Sep¬

per

Stock,

Common

tember 30, 1950, to

18, 1950

of record

Checks will he mailed.
Robert P. Resch

QiuifkyAi]

at

Surplus

dividend of

of the Company a

payable September

declared

have

Directors

from

29, 1950, to stockholders of record at

John H. Schmidt

Secretary-Treasurer

COMPANY

THE ELECTRIC STORAGE BATTERY

follows:

stockholders

the close of business

September 19, 1950. Checks

on

will be mailed.
C. ALLAN,

H.

Vice President and Treasurer

Secretary and Treasurer

September 6, 1950.
Philadelphia 32, September 8,1950
WESTCL0X

•

BIG BEN

INTERNATIONAL

MINERALS

i/.'i

yf\

SETH THOMAS

STR0MBERG
HAYD0N

RECORDERS
MOTORS

& CHEMICAL CORPORATION

'/■

*

GeneralOfficet:20 North Wacker Driva, Chicago 6

i

<

I'M! ■«■>!*'

•<«■»("

'hid'

T--

r
*7"'

ri'

"

'»
.

'

'

'

''-

• <

r

•/':

;

)■

*-i

i

i

»i

7

t;;*-

,

:

•

the

dividends
1950,
to

Both
October
3,

Corporation.

September 20,1950

a

by application to Guaranty Trust Com¬
of

•

Both dividends
extra

United

Kingdom,

has

quar¬

a

September 30, 1950 to stock¬

JEROME A. EATON. Treasurer

Common Stock,

the

on

payable October 2,1950 to share¬
holders of record September 19,

ber 2,

United States Internal Revenue Code

pany

dividend

A

share

of the Double

between
United

regular

on

on

holders of record at the close of busi¬

Quarterly Dividend of One Dollar
($1.00) per share.

STOCK

COMMON

Common Stock,

by

Directors

of

the

declared

a

terly dividend of $1.75 per share

ness on

Mining and Manufacturing

Dividends

shareholders of record Sep¬

to

50

who may be entitled

Article

Taxation
States

STOCK

stock¬

Secretary,

OTTINGER,

dividends:

JRegular quarterly dividend of
$1.06^ per share, on the ty\
per cent Cumulative Preferred
Stock, payable October 2, 1950

An

McCORMICK, Secretary.

to

business Sep¬

the

^2^
Phosphate

August, 1950.

ORDER

House, Egham, Surrey.

Stockholders
virtue

1950,
of

dated

York,

New

1937.

September 12, 1950

1950.

DATED 22nd

11,

close

the

at

able

w

cash

N. Y./ September 6, 1950.

New York,

Treasurer.

a

1950.

September 20, 1950.

LANGLEY,

1950,

share on the outstanding
this
corporation has been

October

record

September
at

per

of

payable

Seventy

July 31,

ended

quarter

dividend

a

The Board of Directors has de¬

PREFERRED

remain

Treasurer.

Corporation

Meeting held this day, declared an interim
dividend
for
the
third quarter of
1950. of

Bank

clear

five

will

C. SCHEUERMANN,

Common Stock of the Company, pay¬

tember 19, 1950.

Limited,
Savoy Court, Strand, London, W.C.2., for

business

dividend of 30 cents per share on the

clared the following

Coupon No. 94 must be deposited with
the

of

Plywood
1950.

392

COMPANY, INC.

\

the

on

United States

Y.

For

Directors

of

Board

The
at

Sinking

Treasurer.

made.

the 5% Preference Stock (less
Income Tax) for the year ending 30th

2%%

close

the

11,

September

Honduras Rosario

DIVIDEND

1950.

Dividends

Saturday)

(excluding
is

payment

at

record

September 20th.
Transfer books
Checks will be mailed.

Jesle

i

below,

date

share

open.

Mining Company

CORPORATION

obtain

to

York,

business

the

per

accordance

in

District

District

Southern

GENERAL TIME

deposit Coupon No.

must

on

$2.00

provisions of the Plan of Re¬

States

United

GT

one
shilling
Stock, free of

of

1950

r\

ending

year

29th September,

on

Holders

the

of Ordinary

£1

Kingdom

of

Stocks, Inc.

NOTICE

Directors,

dividend

a

The

the

on

the

1950.

18,

DIVIDEND No. 32

dividend

the

ROBERTS,

G.

The Board of Directors has declared

30th

I.

to

organization confirmed by order of the

JOHN

FOX, Treasurer

of

notified

capital stock without par value of this cor¬
poration, payable September 26, 1950 to stock¬

E. W. ATKINSON, Treasurer

September 13,

issued

stock

the

at

Board

September 12, 1950.

New

surrender of said securities,
Company's $1 par value
Stock, will be made when and
securities
are
so
surrendered

and

hereby

for
payment
said Bank.

Tobacco and Allied

declared

?fiiiiiiiiiiiiiimii!iiiiiiiiiiiiiiiiiiiiiiiiiiiHinimiiiiiiiiiiiii«

the

Y.

SAMUEL M.

By

September

I
—

the

if

located

creditors

therefore

DIVIDEND

Capital Stock of this

1950.

Twenty-Year 7Vz'U
Gold Bonds,
entitled to
of

All

Cents

Eighty

business

of

Bank,

in the State of Connecticut,

August

The

Company, payable October 16, 1950, to
stockholders of record September 30, 1950.
The stock transfer books will remain open.

BEARER.

interim

of

NOTICE

claims

has

been declared on the

OF ORDINARY AND PREFERENCE STOCK

second

of

the

DIVIDEND NOTICES

2

the Company's $1
Stock,
payable
to stockholders of

on

GENERAL REALTY & UTILITIES
CORPORATION

LIMITED

A

favor
with

National

affairs.

are

present

regular quarterly divi'

dend of 50tf per share

=

Common

at the

record

of

dividend

share

September

Common

COUPON NO.

OF

a

per

value

shares

30, 1950 at The Commercial National Bank and
Trust Company of New York, Trustee, 46 Wall

Street,

($.80)
par

upon

will be paid on September

Corporation,

Utilities

declared

Fund

Debentures

Payment of the amount called for by Coupon
52 representing interest for the six months
period ending September 30, 1950 on the abovementioned
Debentures
of
General
Realty
&

TO

in

this day

Mortgage

No.

WARRANTS

to be

as

COMPANY

York 5
has

Directors

its

closing

HON OIL

Payment of this dividend to holders of
Certificates
of
Deposit and old First

CORPORATION
Income

of

Board

tember

Cumulative

4%

The

semi¬

GENERAL REALTY & UTILITIES

HOLDERS

so

Liquidating Agent.

2
2
5

New

Street,

SHARES

declared

business

of

SAMUEL

September

has

the
Corporation
payable
to stockholders of record
September 20, 1950.

Capital
Shares
of
September 28, 1950,

TO

indi¬

commit¬

necessary

COMPANY

SUGAR

Wall

106

Board

CAPITAL

ON

DIVIDEND
The

DIVIDENDS

the

Government

DIVIDEND NOTICES

DIVIDEND

OF

the

of

at Thomaston,

pro¬

GENERAL REALTY & UTILITIES

NOTICE

arranged

Thomaston

Dated

and

DIVIDEND NOTICES

DIVIDEND NOTICES

COMPANY

the

LIQUIDATION
The

,

TOBACCO

of

under

F.

=

BRITISH-AMERICAN

terms

acreage

Saskatchewan,

Alberta

and

would

ceeds

of

the

was

irri¬

including

Financiera

guaranty

heaval in Korea.

Although the bidding for Vir¬
geological work and drilling on
ginia Electric & Power Co.'s $20,- certain
holdings.
runner-up whose bid was carried
000,000 of new bonds was relative¬
Plans were understood to call
ly close with only about 11.1 cents
for the sale of slightly less than
DIVIDEND NOTICES
separating
the
winning
tender
it

of

the United Mexican States.

ity bonds carrying 2.75% and

roughly $400 for the entire issue,
separated the two tenders.
enough

for

fields

sizable amounts of Double A qual¬

in the week it de¬ funds involved
only one cent, or ously.

Curiously

the

established

be

Nacional

Co. is reported contemplating fi¬
Now a wholly-owned subsidiary
3%
nancing up to at least $10,000,000
Co., due in 20 years.
of Superior Oil Co. of California,
coupons.
Observers were a bit
which should reach market along
Two large banking groups were puzzled by this move and assumed the latter's interest would be di¬
in the running for this business that the potential seller could see luted to 51% with the completion about the same time.
and when the bids were finally an opportunity for employing the of the sale of the foregoing stock.
Tennessee

the

time

to

in

appropriate to the specific pro¬
jects to be financed. The credits

for bids that day.

150,000 share common stock of¬
Meanwhile Niagara Mohawk
fering contemplated for Canadian
Power Co. is reported planning
Superior Oil Co. of California will
those who watch the market close¬
be on the market today. This stock new financing which may run to
This was especially evident in
ly.
was
registered late in June, but $40,000,000 a few months hence,
the
case
of
one
of
the
week's
At
least
one
large institution
evidently was set back by the up¬ while Louisiana Power &
largest undertakings,
$40,000,000 was
Light
reported trying to dispose of
of

The

vidual credits

Illumi¬

nating also has $25,000,000 bonds

re¬

if the 2,-

as

Electric

time

projects

The

gation; communication; and elec¬
tric power generation and trans¬

$3,600,000 of 25-

Cleveland

1975.

the

to be estab¬

are

agriculture,

way;

first mortgage bonds, due in

year

Big Stock Offering Due

date for

same

of

transportation, both rail and high¬

Co.

pectations and the bonds

more

from

specific

common.

yield the return indicated
above was not exactly up to ex¬

composure now

Directors

of further credits to Mexico.

in¬

be opened Sept.

that the heat of the Treasury-Fed¬

variety of

a

issues

the

with

of

Bank
announced
that it had committed $150 million
of its funds for the establishment

eral Reserve contest has simmered

rather substantial scale

a

this week
new

business

land

2.71%.

Apparently

Board

Export-Import

a

first day of subscriptions.

43

'*

1

' •'! " '

I
'

•

;

d

44

The Commercial and Financial Chronicle

(1028)

.

.

Thursday, September 14, 1950

.

deposit

BUSINESS BUZZ

The

Washington...
A
J
XM.ll/tA/

Behind-the-Scene Interpretation*
Iron the Nation'*

Capital

r*r*'V

W....r...

'

,j y

ri

If

passing of this session of Congress,
some
beautiful prize
legislative

analysts

Truman

ference,

special, session, however, is likely

after the

deal

to

with

limited

a

will

which

of

One

these

the

program

action

preclude
most of these things.

that

get
of

easy

Point

the

made

vestments

to

Labor Extension

The

be

a

for

servation

and

in

to
in

few

metal,

and

with

along

it,

)ji

will

ris

industry

defense

straw

a

by the

the

crease

when

the

board,
the

break

to

a

wage

a

V.

previous

a

conference

ago,

a

210

CIO
in¬
and

The

preters,

0>6tfs

R.

Chairman

Maybank,

Banking

President to
tion

Committee,

call such

conference

is

to

is

dismal failures

remembers the

he

manufacture

4a

ing

middle

a

ground

jeep

a

the

prime

with

cials,

a

the

whose

contractors
vehicles.

gun

it to

on

The

15

getting

are

are

in

in

offi¬

procurement

plans

various

stages of negotiations. Cadillac has
got

letter

a

intent.

of

national Harvester,
will

get

Others who figure
Pacific

include

American

pretty
in the

Car

Car

&

Inter¬

it is reported,

order

an

persons.

&

soon.

picture

Foundry,

Foundry,

and

tration

of

Communist

organizations
The

latter

would

be

"front"

their

officers.

and

form

in

the

is

that

the

registration

by

the

lobbyists.

The

commie "front" officers would be

required

to

report

and expenses,

lobbyists.

as

"Is

their

income

just about the same
Y " * ♦»' •

it

interfering with
liberties to require commie

civil
sym¬

pathizers

to report as much as
lobbyists?" That will be the an¬
swer

to the President's announced

veto of the
veto

Bill, when and if that

is

*

certain

capable

of

limits,

minimum

tooling.

they need, but what
produce with the

can

of

conversion

and

moral

a

revolt

the

motor

industry, as in World Wai;
II, will be producing everything
from
motorized
equipment
to
guns
and aircraft.
But the in¬
dustry can get going on armored
vehicles

>

almost

faster

than

#

a

terrific

Controls
to

him

Bill's

to

call

the
ury

headache

seeming
an

in

the

mandate

industry-labor




of

Board

the

of

program

the Korean

up

that

with

evaporated

war.

They

this

idea,

preferred

a

be enacted,

were

even

only

to

decided

Committee

chuck

to

the

of

automobiles to the reduced supply.

entire

the

even

special

small

Jr.

Pacific

623

Calif.—Clem¬

has

joined

the

Company of Cal-

South

Hope

just
four

doubt

Chairman Maybank went

uling

sched¬

even

these

appointments for a
So all the four nominees

hearing.
out

are

without

of

luck.

Meanwhile, both Messrs. Hise
Gunderson, if they want to,
may, under the law, serve until
their
successors
qualify.
Pres¬
and

ident Truman

pointments
if

he

calls

one

make recess ap¬

before
for

resignations.
only

can

He

January

and
can

fill

name

an

old

upward

The

jji

bill

Street.

In
set

the

instalment

credit

terms

by the Federal Reserve Board

in

its reinstitution of Regulation
W, the Board is believed follow¬

ANGELES,
Swede

Calif.—Max¬

with

is

U. S.

Finishing

Television Equipment Corp.
Trad Television
Video Corp. of America

Government Employees Insur.
Cinema Television B

Scophony-Baird Ltd.

M. S. WlEN & Co.

set

1919

HA. 2-8780

Teletype N. Y. 1-1397

some¬

assess¬

For

Large Appreciation Potential
WE SUGGEST

the

assess¬

only

up

awaits

Exchange PI., N. Y. 5

million

insurance

to

40

member

$67

Shields

House

istration

favors

"royal assent"

this

may

bill, hence
be taken for

granted.
Under

the

bill

banks

are

legally liable for their full
ment,

but

after

deduction

administrative
if

any,

a

and

ings
some

on

for

expenses,

RIVERSIDE CEMENT CO.
CLASS B (common) STOCK

open

40%, along with

A
in

leading producer of cement
fast

-growing

Southern

California.

Analysis of this Company and
a

review of the Cement

Indus¬

try available on request.

Selling about $8.50

for

reserves

credit of 60% to the banks.

balance of

still

assess¬

to

The

earn¬

the FDIC capital funds of

LERNER
Investment

& CO.
Securities

10 Post Office Square, Boston 3
Tel.

HUbbard

Mass.

2-1990

$1.2 billion, is added to the

Teletype—NY 1-971
Firm Trading Markets

All Issues

Baker

Raulang

National Alfalfa Cr Deh.
Placer

flirt¬

though

Allied Electric Products

Jack Cr Heintz

FOREIGN SECURITIES

Development

r.AHL MARKS & P.O. INC,

"talk"
FOREIGN SECURITIES

though

business

cur¬

fi-

Hill, Thompson & Co., Inc.

SPECIALISTS
Trading Department

50 Broad Street

New York 4, N. Y.

&

Company, 510 West Sixth Street.

proval. Ostensibly all the Admin¬

losses

#

of

their

credit

FDIC

vacancy.

FDIC

approval of the conference report
and subsequent Presidential
ap¬

their

gets

legally

to

man

only

that

ments payable beginning with the
July, 1951, installment.

ment

J

to be little

appears

banks will be credited with

basket.

Europe

now

but

against

to

I.

ESTABLISHED

There

what

with

majority disliked the then

rent

Banking

record,

hoped it would

and

Cope,

of

LOS
well

ap¬

HAnover 2-0050

hundreds of mil¬

small business and
not

public

new

obligating the Treas¬

to back

Co.,

Re¬

lions in loans to "small business,"
a

the

on

good
many
Congressmen
playing fast and loose with

idea

many

President Truman has ahead of
him

A
were

ing
*

the

on

anything else.
*

to

construction Finance Corp.

re¬

eventually,

Perhaps,

because

the

RFC appointments into the waste-

Congress

sustaining

ments

what

and

of

losses, the net balance is

obtain

industry

this

*

against certain "too raw"
politics,
as
is
currently
being
illustrated in the case of appoint¬

.sensibly

here

!]!

proceeding with some
speed for a change, not merely to

Defense procurement officials are

the

of

criticisms

comes.

Within

industry hopes

wind

of

almost identical to that

required

*

The straw which
sees

spies and saboteurs,
requires the regis¬

on

Chrysler.

it

Because

Senate

tractor.

contractors

touch

in¬

munists and arranging for clamp¬

these

with

tracklaying

a

Bill

the

to

Street.

(Special to The Financial Chronicle)

between

such conferences,

Anti-communist

Seventh

With Shields Co.
nancing aid program sponsored by

Depart¬

Armored vehicles range anywhere
from

of the past with

staff

direction.

Hence, the President, even though

been added

Dempsey-Tegeler &

ANGELES,

M.

fornia,

-Why not try looking at it this way—'you don't
have any securities left to WORRY
you'!"

the

stabiliza¬

a

a

ANGELES, Calif.—Albert

of

LOS

CF

the

of

"authorization"

the

ing down

prime

Inc.,

Broadway,

Dempsey-Tegeler

West

ent

Senator Burnet

including

the Mundt Bill

15

42

(Special to The Financial Chronicle)

of qualified inter¬

opinion

proceeding with armored

with

Co.,

Pacific Co. Adds

con¬

up

pointees, criticisms not yet aired

It is reported that contracts are
"b.ot"

&

Sander has

staff

ference.

procurement.

vehicle

years

York City, as Manager of
trading department on Sep¬

LOS

no-strike pledge.

a

across

managed

Mundt

if there

17

Bros.,

(Special to The Financial Chronicle)

indicated

wind

Cohon

With

Apart from
requiring
the registration of outright Com¬

the Defense

way

is

ment

in

Strauss

tember 15.

contracts,

other

Industry is wondering
is

Strauss, for
of

become associated with Mor¬

their

terferes unduly with the rights of

#

officer

an

President.
being too tough and too easy, in
Then
President Truman failed its judgment.
railroads; a Bill to subject to the must go through with this one,
to
renominate
Chairman
Harley
Hence,
the
objective
of
the
Clayton Act ban, the purchase by guaranteed
to
be
an
equally
Ilise and board member Harvey initial
terms
promulgated after
one
company of the assets of a dismal failure.
J.
Gunderson.
The
latter,
an
the President signed the Controls
-competing company; the proposal
Incidentally, the wage provi¬ avowedly Republican member of Bill into
law, is to clamp down on
to legislate "equal pay for equal
sions of the Controls Bill nowhere the
Board, openly
opposed
the inflation generally.
When, as, and
work" for women, and finally, a call
for a wage "freeze." The Bill President's
program.
In Gunder- if the war production
program
Bill to legalize hiring halls in the
uses only the term "stabilization."
son's
place
the
President
nom¬
begins to impinge heavily on the
maritime industry.
The
current
Administration
use
inated
a
"captive
Republican" raw
materials
of
industry, the
No matter how far any of these of the word "stabilization" con¬ who
testified
in
favor
of
the Board
may
be expected to pro¬
proposals has progressed in the notes a steady upward rise.
President's program, renominated
mulgate larger down payments
«
*
.if!'
legislative machine, it becomes a
one
member of the RFC Board,
(except
for
automobiles)
and
dead bill with the ending of the
nominated
two
other
new
Conservatives here have what and
shorter
repayment
terms.
The
81st Congress.
To be revived, it
members, all red hot advocates of
they
think
is
a
pretty
tight
"tougher" terms, when they do
Jhas to begin in committee at the
answer
for
President
Truman's the idea of nursing small business
come, will be designed to cut back
(starting line of all legislation if assertion
that
the
McCarren- from the Federal Treasury.
the
market
for
appliances and
it is to be

passed next year.

views.)

Morris Cohon & Co.
Abraham

New

all

years

Senate

proposal to continue duty-free
copper imports; the Murray Bill
to authorize a union shop in the

coincide with

own

Abraham Strauss With

cost-of-living

a

spokesman demanded

that

toe

"Chronicle's"

If management will

adopt

labor-management

in mine

scrap

the

forego "excess profits" for the

rection; a Bill for aid to states in
too
promotion of safety in in¬
dustry; the O'Mahoney Bill to aid

explorations; the Bill to

from

return

This is reminiscent of

di¬

continue duty-free importation of

re¬

election.

happy to sign

use,"

Federal

share

$10,000

$5,000..

and may or may not

duration, organized labor will be

con¬

"orderly

.

"beneficent"

under

their

to

flect the "behind the scene" inter¬
pretation from the nation's Capital

of the Taft-Hartley
for the duration, and to agree

Act

to

survey

recommended

insurance

rise

to suspension

labor

the

provide

*

but in particular to agree
pledge. Labor, it

clause

Service, to utilize

unions; a bill
of handi¬
capped persons, and thus help
build up a program for the physi¬
cally handicapped under Social
Security; the Neely mine safety
bill sought by the coal workers;
a proposed "study" of the nation's
fuel reserves so that plans could
help

to

bill,

association
also

(This column is intended to

con¬

a

will

-

'

no-strike

a

agree

proposed

extension agents from universities
to

">

.

presumably,
necessary
until

be

not

three things.

include:

sy

labor unions to agree to go
with demands for higher

mand

IV.

Others

such

from

r

.'yjIV '/•'

1

is reported, will be all set to de¬

under

abroad

will

wages,

Federal gov¬
guarantee
private
in¬

ernment

1

.

individual

conference, of course, would be to

packages is the President's

proposal

-

Purpose of a wage-stabilization

on

beautiful

most

are

call

I," '

>

T'*

rVv^

.4

FDIC

raises

another

homestead

accounts

although,

packages will die, barring a special
session before January.
Even a

this

here

must

4'"*-

■■

stabilization.
correct, Mr.

wage

bill

same

Under
of
1"'

re¬

deposit account, from the present
$5,000.

'

vr

.•

JL l/lt

i
on

;•

*

V/^vw a

,

conference

agency's

coverage to $10,000 per

ff'y:.

WASHINGTON, D. C.—With the

insurance

sources.

70 WALL
Tel.

STREET, N. Y. 5

WHitehall 4-4540