Full text of Commercial and Financial Chronicle : September 15, 1955, Vol. 182, No. 5464

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u NI V £ r
s I r y

OF

MICHIGAN

SEP 16 1955

ESTABLISHED 1S39

Th e

tf/Z

Chronicle

Financial

Reg. U. 8. Pat. Office

New York

Number 5464

Volume 182

EDITORIAL

of the Republican

party or¬

ahead

interest rates

just what the Republican party plans to do in
!1956. The President again and again and again

The

*

r

*

,

♦»

«•

term

President

the

to

It

is

Toward

his

personal charm

merely
are

have taken

agencies

1956.

a

not

an expenditure of
proximate $10 billion.

ing

steps

on

at

War

II.

bution

Continued

—

the

to

boom

on page

In terms of

State and

Municipal

pay

for

Securities

UNION BAG & PAPER
blue

chip selling at 12%
1955 earnings

estimated

.

.

times
.

STATE

AMD

address

by

Mr.

telephone:

HAnover 2-3700

increase

.

.

in

position

CHEMICAL

.

Edgerton at the Stanford

growth

a

Analysis

State, Municipal

CSTABLI6HEO
MEMBERS
ANO

BOND

OTHER

NEW

STOCK

YORK
AND

IBB*

STOCK

the first national city bank
of new york

EXCHANGES

Broadway, New York 6, N.Y.

30 BROAD ST.,N.Y.
Miami

Beach

Rye, N.

—

Net

T. L.Watson & Co.

Active

Dealers,

1832

Banks

Orders

Canadian Exchanges

CANADIAN

Exchange

Brokers

Common Stocks
FIRST

<§CutflW€4t COMPANY
Dallas




STREET

BROAD

NEW YORK

4, N. Y.

DIRECT

WIRES TO

BRIDGEPORT

•

PERTH AMBOY

115

Executed

BROADWAY

from

bank

coast to coast

On

General Gas
Analysis

All

f

♦

upon

request

•

DEPARTMENT

PoMimoTf Securities

MONTREAL AND TORONTO

N^W YORK STOCK

NEW YORK

offices

At Regular Rates

Goodbody &
MEMBERS

Chase Manhattan

BONDS & STOCKS

Teletype NY 1-2270

25

34

Exchange

BROADWAY, NEW YORK 5

CANADIAN

Utility Bonds,

Preferred and

DEPARTMENT

Maintained

and

SECURITIES
Commission

Stock

Markets

CANADIAN

Members

American

Teletype: NY 1-708

Bond Dept.

BOND

THE

Members New York Stock

Y.

New York Stock Exchange

Bonds and Notes

REQUEST

HARRIS, UPHAM & C9
120

To

ESTABLISHED

BOOKLET

REVIEW"

EXCHANGE

COMMOOITY

Public Housing Agency

ARE NOW AVAILABLE

DEPARTMENT

115

Public

and

"ATOMIC ENERGY

industry.

J. R. WlLLISTON & Co.

BANK

18

investors in cor¬

NEW

Request

on

page

Stanford, Cal.

ence,

ON

CORN EXCHANGE

on

Business Confer¬

COPIES OF OUR

BONDS

Entrenched low-cost

luxury
income after

American families

constant dollars 58% of

W

MUNICIPAL

Pos¬

sibility of stock split and dividend

Edgerton

adequate housing—even

A
A

Howard

Continued

28

Underwriters, dealers and

to

able

came

in

U. S. Government,

J.

the

been

housing by 1952 standards (this is annual
taxes and in terms of constant dollars).

complete picture of issues now registered with the SEC
"Securities in Registration" Section, starting on page 34.

undertakings in our

has

income

carried

a

World

of

Another significant contri¬

rise of the American middleand in the incomes of American families gener¬

♦An

afforded

of adequate hous¬

conclusion

the

From 1945 until the present time some 9Vfe million
families moved from an under-$fj,000 annual
status to the bracket over-$5,000 and thus be¬

ally.

Underlying this tightening of credit
the current upsurge in the econ-

are

^

non-farm

Roy L. Reierson
business activity beyond all
previous peaks. Demands for bank loans and for instal¬
ment credit are soaring, and requirements for investment
capital seem to be running ahead of current savings. In
this environment, some restraint upon credit expansion
appears sound and proper in order to temper the boom.

securities

and potential

DEALERS

ing

class

SECURITIES NOW IN REGISTRATION

porate

cause

Tempering the Boom

has

a

boom the past decade be¬
we
inherited in 1945 a tre¬

great

which

another ap¬

housing

being.

omy,

been

part we have had

great

time

22

page

the

In

mendous shortage

is

have

houses

generally rising trend of interest
rates, under way since the start of
the business recovery in 1954, gives
no
evidence of reversing for the

conspiracy to gain power.
held together by a cause, then
Continued

million

35

repaired and modernized, represent¬

ment

such a way
Says the President to

of

some

tighten the reins upon instal¬
buying, home financing and
business investment spending.
The

unfortunately, for the

a

we

diture

representing a total expen¬
$92 billion.
In addition,

houses,

to

late,

political party is not held together by a
common faith, a
common conviction, in certain
fundamentals, then it is not a true political party,
"If

the
be¬

rate

to spread to other Federal Re¬
banks as well. In addition, the
Federal Reserve and various gov¬

"If you will forgive me, instead of
jumping into farm problems and Geneva prob¬
lems, and things of that kind which are discussed
interminably, I am going to talk just a little bit of
philosophy this morning — political philosophy.
That is because of a very deep and abiding belief

but it is

decade, the American:home builders
have
built" some
10
million new

2Va%.

serve

party:

that if

to

what we can honestly
in housing finance and relate

today

that have been made to the general economy
of our system. As everyone knows, we
10 years a tre¬
housing boom. In the past

mendous

month,

2

a

was

\

have had in the past

%

the

of

end

toward

increase

I

discuss

revolution

a

as

the future

and

interest rates have ad¬
especially in the short-

the

where

to

,

for alarm. Says, by 1970, two million

'

to

propose

"

to be effective in

his

moderately

a

j,

the changes

gan

party to take the President's advice in
as

the

movement

<

rather

now

throw

to

following

now

and

>.

homes will be needed annually.

new

August, the discount rate was
in all Federal Reserve districts

in

to 2%

Cleveland,

ernment

fray.

policy,

Early
1%

from

except

communism; they wound up with frantic appeals
1 into-the

field.

raised

on

>■*

is

Reserve

credit

no cause

'

■r

I

vanced further in recent weeks,

sionals, or many of them, were rather cool to the
whole idea, preferring to rely on an appeal to the
public on what they believed to be a popular
«*.''*•.

edness is

likely to persist. Looks for increase
of required member bank reserves.

Federal

restrictive

!

and
of increase in mortgage indebt-

values," the rate

asset

refer

pled with his party in 1953 and 1954 to lay a basis
in action for a successful appeal to the public on
the basis of a record of achievement. The profes¬

<

income, interest rates, types of mortgage contracts,

are

in amount

place in the methods of home mortgage

Calls attention to factors which should be
considered in computing the burden of mortgage debt,
and contends, "when considered in relationship to today's

likely to be strong and upward pressures upon

are

•-

boom, and lists the important changes

financing.

taken by the Federal Reserve to temper

banking. Notes rising trend in all categories of interest
rates and concludes demands for bank loans in months

is

I*

that have taken

trends

boom. ; Lists the recent consecutive economic re¬
straints and discusses their implications for commercial

pealing to the voter on the basis of mere hero
worship, and the other is that nothing in the un¬
certain realm of politics is more certain than that

J issue of the former Administration's "softness"

of current housing

the

properly serve the country by ap¬

or

Housing Finance

Savings and loan head describes background and impact

Dr. Reierson reviews recent economic and business
measures

Copy

a

President, United States Savings and Loan League

Vice-President, Bankers Trust Company, N. Y. City

and the

Cents

By J. HOWARD EDGERTON*

By ROY L. REIERSON

ganization and the recent advice of the President
'suggest two observations. One is that the Presi¬
dent is eternally right in warning that no politi¬
cal party can build for the long-term future on,
Jthe personal popularity or reputation of a single

^individual

Trends in

Tempering the Boom
Through Credit Restraint

As See It
We
Recent activities

.(

Price 40

7, N. Y., Thursday, September 15, 1955

Co.

EXCHANGE

1 NORTH LA SALLE

CHICAGO

ST.

Grpokatioti

IRA HAUPT & CO.
Members
and

York Stock Exchange
Principal Exchanges

New

other

111 Broadway,
40 Exchange

Place, New York i5, N.Y*

Teletype NY 1-702-3

WHltehall 4-8181

WOrth 4-6000
Boston

n. y. 6

Teletype NY lr2708

Telephone:

Enterprise 1820

2

The Commercial and Financial Chronicle...

(1066)

American

The

Dealers Only

For Bunks, Brokers,

Express

which, each week, a different group of experts
advisory field from all sections of the country*
participate and give their reasons for favoring a particular security.
in the investment and

Central Indiana Gas

Central Public Utility

(The articles contained in this forum

Colorado Interstate Gas

they to be regarded,

•re

FRED

Gulf Sulphur

The

Steel

Safety Car Heating & Lighting

Pipeline

Travelers Insurance of Hartford

This

is

for

better
and

New York Hanseatic

Corporation

120

Private

and

-

Exchange

Principal Cities

an

the

Members

Exchange
Exchange

NEW YORK 5

TEL. REctor 2-7815

Gas

Company

Commonwealth Natural Gas

Fred N. Ogden

Scott, Horner &.
Mason, Inc.
Lynchburg, Va.
Tele. LY 62

LD 33

paid

and

1896,

transportation, I would not be
writing this article.
During the

authorized

common,

past two years, important changes

blue

developed

jectives. The Saiecy Car Heating
and Lighting Company is now in
a

favorable position to ex¬

very

management and Board of
therefore have inaugu¬

of diversification
expansion. The basic objec¬
tives of this program are: (1) to
a

program

and

put excess resources to work, (2)
to expand operations, (3) to in¬

profits, and (4) to continue

to their customers.

This company has
established

well

of

facturer

financial

reputation

a

as

fine

a

quality

manu¬

Its

products.
are

resources

than

more

ample to enable the company to
out

carry

no

broad expansion pro¬

a

With practically no debt,
preferred stock, the small
issue

sole

of

common

ownership

plants
with

electrical

con¬

of

this

of the finest,
good
tools
for

are

mechanical

and

work.

The

engineering is handled by a
capable department with broad
experience,
and

The

chanical

with

and

facilities

grams.

for

personnel

expanded

electrical

"know-how"

pro¬

and
in

me¬

man¬

agement, sales, engineering,
production has been gained
a

long period of
While

and

Lighting

and

still

Inc.

makes excellent

lighting fixtures,
heating and cooling controls
for railway cars, many important
steps have been taken in their

FIRM

TRADING

MARKETS

Mindanao Mother Lode Mines

Marinduque Iron Mines

A
c o m

Established

1919

Members

New York

1

Security Dealers Ass'n

Exchange Place, Jersey City 2, N. J.
Tel. HEnderson 5-9400
New

Teletype J CY 783
York City Telephone BArclay 7-0045




p a n

sion,

which

mixers,
dust

contribution
y's industrial

from

comes

the

to

the

business

Entoleter

Divi¬

makes

high speed
machines,
and

impact

collectors

f

the

milling,
feed, and chemical industries.
In

M. S. WIEN & CO.

large

August

or

of

1954, the Safety
acquired all the out¬

Company
standing stock of Liquefied Gas
Utilities, Ltd. of Montreal, Que¬
bec.

This company

Trying

curity

to

I

difficult

specify

write

Like

is engaged in

you

take

a

Se¬

rather

a

When

you

like best

you

of

the

se¬

Do

inguez
Fields

in Canada.

The company

..

J°"ph L' R5"""

conditions

and

several

to say

me

cause

company
the laws

"this

best."

organized

was

Delaware

of

in

November, 1925. It has undivided
interests

ranging from % to V2 in
approximately 2,100 acres of pro¬
in

leases

the

Dominguez

Field in the Los Angeles Basin. >

dry

oil,

Union Oil
and

development
are

Union

Co.

7,

is

sold

the

to

Company of California

operations
Oil

Under

gasoline "and

natural

produced

gas

production

and

conducted
and

terms

Dec.

31, 1954, net income has ag¬

Shell

vents

them

were

holders.
this

the

a

the

have

i

share

per

Broadway,N.Y.8 COrtlandt 7-5680

BOUGHT —SOLD

QUOTED

This

outs anding.

L A. DARLING

capitalization of the company and
the average over the 30 years paid
in dividends has been $3.07 per
share.

The

will

has

Midwest Stock Exchange
Detroit

impressive

an

that

is

Members

$3.00 and
manuals he

dividend
record which ranges from a low of
$1.07 ¥2 paid in 1932 to a high of
$5.55 paid in 1926. Another unique
see

M0RELAND tCO.

the

years

been

the

in

looks

one

three

last

rate

month,

per

so

Stock

Exchange

1051 Penobscot Building

DETROIT

26, MICH.

Woodward 2-3855
Branch

DE 75

Office—Bay City, Mich.

is

dividend

this

1897

Brokers <fc Investment Bankers

111

$36,820,000 or
on
the 400,000

aggregated

for

a

needing income who has
shares, he receives $25.00 each
Establised

1856

H. Hentz & Co.
Members

total

purposes;

that their activities

field.

are

As

a

has

changed,

secondary recovery

pro-

in

the

past. Oil in the ground is regarded
as a good inflation hedge.
The

stock

is

traded

the

in

un¬

Exchange

Stock

Exchange

New

Cotton

Exchange

York

Exchange,

Commodity
Chicago

Board

New Orleans

and

N.

other

Cotton

Y.

NEW
Chicago
Miami

Exchange

Detroit

Beach

Bollywood,

Fla.

Geneva,

Exchange

exchanges

YORK
•

Inc.

Trade

of

Cotton

•

•

N.

4,
•

Bldg.
Y.

Pittsburgh

Coral

Beverly

Gables

Hills,

®al

Switzerland

Amesterdam,

Holland

listed trading

division of the San
Francisco Stock Exchange and at
times

has

market.

over-the-counter

-an

It

is

currently trading at

53V2, which gives
The

balance

which

pany,

5.6% yield.

a

sheet

of

the

is ..available

com¬

the

in

manuals, shows total current
of

sets

$3,796,COO

of

which

as¬

over

$3,300,000 is cash and U. S. Treas¬

Federal

pre¬

amount

an

produced

accrued

company

one

that

to

the

95% of the share¬

this

equal

Stock

\raerican

to

duced in the future be

York

New

received from the sale

was

of

modified Dec.

practical

this situation
a

Established

Home Office Tokyo—70 Branches

30-year period dividends

same

liabilities

that of exploiting assets of
wasting nature. In the last few

due to

Yamaichi

matter of' policy. Over

years as

ury

result, the company's business has

years

write

or

Securities Co., Ltd.

the

is

Dominguez
does
not
have a large organization and is
aole to pay the majority of its
earnings out in dividends and the
directors have done this over the

current

carrying on ac¬
other field without

over

in

Union

that

Co.

from

For

means

centered

of

any

consent of

Due to the
principal

$40,382,420.

gregated
fact

Oil

certain

of

drilling rights are un¬
to 1973; thereafter for
10
years
the company has pro¬
ducing and limited drilling ri?hts.
There is a unique feature in that

tivity in

Call

operator

the

1950,

charter

has earned money

by

restricted

the

investors with knowledge

dividends every year
since its
incorporation in 1925.
Over the 30-year period through

should the number of barrels pro¬

is the security I like

ductive

to investors with vision—

paid

gasoline, which brought
$3.44.
This higher
price for oil would give consider¬
able
impetus
to
the
earnings

_

strong financial position, excellent

under

have unusual appeal

may

of Japanese potential.

and

the

.

growth,
marketability,

The

SECURITIES

of gas and

income,
potential

other factors

JAPANESE

the conventional method.

barrel

Its

operating

offices

sec¬

the aver¬
age
price received for the oil
sold
by the company has been
$1.4833 per barrel. For 1954 and
currently, the price received has
been
$3.00 and,
in addition, in
1954 the equivalent of 44 cents a

is

Company.

branch

our

Over the last 30 years

security

iri

Oil

Mobile, Ala.
Direct wires to

month.

highest

best

conditions

best

ooerations might
at least double this percentage."
In other words, it would look as
though as much oil could be pro¬
duced
by
secondary
recovery
methods as has been produced by

100

aggregate

like

NY 1-1557

person

score.

The

rule of thumb,

a

HAnover 2-0700

New Orleans, La.Birmingham, Ala.

recovery

paid 25 cents

and

the

Under

ods.

ondary

feature

into

select

"As

source:

19 Rector St.. New York 6, N. Y.

400,000 shares represents the sole

been

users

tical

Members New York Stock Exchange

Members American Stock Exchange

only 25% to 30% of oil in place
in the average field is recoverable
under primary production meth¬

shares of stock

curity that has

a

dustrial

Steiner,Rouse&Co

best.

is

Bought—Sold—Quoted

Co., Los Angeles,

which is under way. While
impossible to predict the
exact degree of success the water
flooding
program
will
have,
quoting from a recognized statis¬

$92.05

to

lot

things
account

the sale and distribution of lique¬

commercial, and in¬

—

gram
it
is

baby

"The

on

Best

security

have

fied petroleum gas and appliances
for domestic,

Co.

(Page 2).

dividend

assignment.

one

leases, which

diversification for the future.

Calif.

if

I

Fields

ter, Ryons &

like

I

Louisiana Securities

Ryons, Partner, Les¬

a

Dominguez Oil Fields Co.

The

and

Philippine Oil Development
Lepanto Consol. Mines

chip—the stock

is

Partner, Lester, Ryons & Co.,
Los Angeles, Calif.
Members, New York Stock Exchange

years.

Company,

This

over

Safety Car Heating

1929

For Financial Institutions

yet issued.

all of which

JOSEPH L. RYONS

,

Directors
rated

Their

Tel. HAnover 2-4850

not

management group, and in its ob¬

equipped

3T Wall St., N. Y.

is

have been made in the company's

Basic Atomics

ESTABLISHED

growth
capi alization
is
small, being but 800,000 shares of

merely grown
with railroad

company.

BreeneimiGoTTipanu

worth-while

a

The

stitutes

Sugar

an

con¬

situation.

Trading Markets

U. S.

under

dividends having been
in

authorized

R. Hoe Common

over 40%.
The stock, selling at this
writing
the Over-the-Counter Market

opinion,

and

Foundation Company

been
nearly
profits, after

net

tinuously since, with the one ex¬

gram.

Corpus Christi Refining

in

constant dividend-paying

giving better products and service

Dan River Mills

have

and

ception of the year 1932.

crease

Company

profits

management,

$28 per share, and paying
apparently safe dividend of
$1.25 per annum, is indeed, in my

The

Alabama-Tennessee Natural

of

and

present

doubled

business.

American Furniture Company

and

one

taxes have increased

pand its operations while con¬
tinuing
to
improve
present

Trading Markets

is

since the installation of

new

gross

a

and

initiated

and

Stock

two years,

Had this company

ffiPONNELL&fo

operations
such

as

engineering
skill, the future is indeed bright
for Safety Car Heating and
Light¬
ing Company, Inc.
In the past

desire

a

and

"know-how"

profit¬

It is

industrial

adequate, efficient plant
equipment, and with superior

and

is

build

of

con¬

With

able company.

Since 1917.

American

in

of 46, and

keen

quality

the companies in the fast
growing
field of automation.

average

company,

120 BROADWAY,

trol

processes

with

group

high

equipment for the automatic

competent

age

manufactures

manage¬

more

Rights & Scrip

It

cohesive,

a

to

Specialists in

field, since its formation in 1920.

heat

to

means

that

sense

stronger

Stock

Inc. has been one of the
pioneers in the electrical control

a

company

a

New York

safer

is

It

Com¬

pany,

1887,
developing

of

purpose

ment group'

1920

Teletype NY 1-40
to

Wires

company,

young

the

Broadway, New York 5

WOrtb 4-2300

old

very

Oil

L.

95%

less than

Inc. of Philedelphia. Auto¬
matic Temperature Control Com¬

way passenger

the

Member

N. Ogden, New Or¬
leans, La. (Page 2).

the outstanding stock of Auto¬

matic Temperature Control

light rail¬

very

Stock

a

the

cars.

£

Associate

Inc.—Fred

the

pany,

having been established in

Standard Fruit & Steamship

American

'

Dcminguez

for

contract

a

acquisition of not

Company, Inc.

Long-Bell Lumber of Mo.

into

Alabama &

Selections

Saftey Car Heating & Lighting Co.,

January of 1955, Safety Car

entered

of

Lithium Corp.

Established

In

-

nor

sell the securities discussed.)

to

N. OGDEN

New Orleans, La.
Member, New Orleans Stock Exchange

Haile Mines

;f

offer

he,

to

Week's

Participants and

Their

Josenh

Dan River Mills

Transcontinental Gas

as an

intended

not

are

This

,

Forum

A continuons forum in

Central Electric & Gas

Portsmouth

Security I Like Best

Thursday, September 15,1955

Notes against which there

counts

payable

of

taxes

of

stock

and

and

surplus.

are

I

The
capi¬

believe

that this is really a strong balance
sheet.
I have tried to demonstrate that

this

stock

record,

by

the

a

has

an

future

indicated

excellent

past

enhanced

much

success

of

the

water

flood
operations and the
potential to come from the ex¬
pansion of it, good
yield, fair
marketability,
strong
financial
condition, good management and

good

partners

in

the

Union

Oil

Co. and the Shell Oil Co. For these
reasons

I

am

this is "The

willing

to

say

saving^

in
ac¬

$233,300.

only other two liabilities
tal

are

$383,7C0

that

Security I Like Best."

N. Q. B.
1

OVER-THE-COUNTER

INDUSTRIAL STOCK INDEX
14-Year

Performance

of

35 Industrial Stocks
FOLDER ON REQUEST

National Quotation Bureau
Incorporated

46 Front Street

New

Yerk4,N.Y.

Volume 182

Number 5464

The Commercial and
Financial Chronicle

...

(1067)

The Broad Field oi

Municipal Bonds

INDEX

By JOHN S. LINEN*

Vice-President,

The Chase
Manhattan Bank
New York
City

'

Mr.

Articles and News
Tempering

Linen, after noting the growth of
municipal obligations

and the

Trends

exemption

that form the
background of municipal
the financial
questions involved in
judging
the market value of

well

as

Some Problems

as

The general
subject of "municipal bonds"—is a term
that is used
to refer to a
much larger
group
than what

technically qualify

municipal
curities.

erally

as

Gen¬

*

speak¬

the

i far

\

of

the

obli-

gations

of

states, ter r itries, insular
p o

•

tical

John

S.

put

out

by

the

Authorities.

add

exemption
they are
the
local
authorities

the

Administration.
get into

:\

.

'

Public

in

of

I

take

a

moment

to

consider

how big this field is
in
municipal
securities. It has
grown tremen-

dously in

recent

1945

total

the

Back

years.

amount

of

in

out-

standing municipal
obligations, or
tax-exempts, was about $16,300,-

000,000.
to

In

1950

that

$23,700,000,000

had

and

at

grown

the

end

t
•Jo,$37330601000b0t0he YouhavTI
€0% inJrease there" £ the last

four

years,

very
ture

marked

which

is
certainly a
change in the pic-

Partially responsible for that
increase, of course, are the Local
Housing Authorities which have
been issuing between
$400 million
and

$500 million bonds

the

last

two

a

year

in

three years.

or

<•

amount

j

of

bonds sold
year has also built up. Last
the

per
year

tax-exempt bonds sold totaled

approximately

$7

compared

with

was

close.

very

billion.

corporate
The

That,
issues,

amount

of

corporate issues was just short of
L..,
$6 k billion. There has been
a
,

TIT
Annual

.,i.

mL

address by
Forum

on

.

Mr. Linen
Finance

'

at

the

5th

conducted

by

is

a

99

4-6551

T. C.

King

9

a

We

it

the

is

commitment

rule

a

of

more

than

is

issues.

Official Films

Corpus Christi Refining

Act

16
%

*

New Investment
Course by A. Wilfred
May and Leo Barnes at
New School for
Social Research
10

Salt Lake

Demonstrates "TACAN"
14

42

Bank Advisors at
"Atoms for Peace"

Conference

a

32

_

As We

See It

Salt

„

.

Bank

.

Generally speaking, the under¬
writers of corporate
issues have a
much better idead
as
to where
they are going to place their
bonds because the
big investment
,,

,

such

the

as

such

Coming Events

proper

classification,

Einzig: "The
Money"

in the

are

and they

commitment is

relatively little
when

so

on

issues

it

of these

is

real

a

8

Recommendations-

8

Alternative—Dear Money

Scarce

or

Indications

of Current

commit-

Mutual

Funds

municipal

risk

commit-

nIs.TA

ment.

Business Activity

lncoi1\e on such bonds
P

f a^,r
bonds*

1?USt

is

l n s u

bo

a

njes

are

not

municipals
the

tax

33

__i

Notes

_____

that

to

them

municipal

be

have

HA 2-0270

Governments

fact

Philadelphia * Chicago •

a

buyers, tO
page 20

34

Prospective Security
Offerings

The Market
'

The

.

.

and

You—By Wallace Streete

Security I Like Best

and

;

FINANCIAL

Industry

&. Co.

Members New York
Stock Exchange

•

Nashville




•

HERBERT

D.

2-9570

to

Chicago

Schenectady

•

•

Glens Falls

Worcester

9576

SEIBERT, Editor

& Publisher

SEIBERT, President

Copyright

statistical

records,
state

corporation

and

Other

issue

city

news,

—

15, 1955

market

quotation

bank

clearings,

news,

Chicago 3,

HI.

135

C.

ary

25,

as

1942,

York, N. Y.,

South

on

very favor¬

100% interest

borca Mine, a

in

Ca-

producing property

of great
promise.

by William B. Dana

second-class matter
Febru¬

at the post
office at
under the Act of
March

U.

Members

Pan-American Union, $55.00
per year;
of
Canada, $58.00 per

Other

Countries,

Other
Bank

$62.00

rate

$1

Per Share

year.

Publications

Report Available Upon Request

—

year.

of

exchange, remittances

eign subscriptions
and
made

Market
Around

year.

per

Quotation Record
Monthly,
(Foreign postage extra.)
Note—On account of
the fluctuations

be

Over-the-Counter

S.
of

in

and

$37.00 per

Traded

New

8, 1879.

Subscription Rates
Subscriptions in United
States,
Possessions, Territories and

etc.).

La Salle St.,
(Telephone STate 2-0613);

Eng¬

terms

Company

the

Offices:

1955

'

Every Thursday (general news and ad¬
vertising issue) and every
Monday (com¬

plete

E.

Smith.

Dominion

Thursday, September

•

Drapers' Gardens,
land, c/o Edwards & London,

Reentered
Publishers

Recently acquired
able

1

CHRONICLE

DANA COMPANY,

WILLIAM DANA

TELETYPE N. Y. 1-5

and

Place, New York 7, N. Y.

ST., NEW YORK 4, N.
Y.

Boston

Weekly

Reg. U. S. Patent Office

REctor

Hickory
Copper Co.

%

You__

COMMERCIAL

B.

Old

16

:

5

Washington

Park

For

43
.

The State of Trade
and

25

•

Los Angeles

NEW EXPANSION

40

Securities Salesman's
Corner,.

PREFERRED STOCKS

Spencer Trask

Y.

to

26

Securities Now in Registration

that

worth

the yield
provide is
attractive to
been times

on

Direct Wires

10

compa-

the

Continued

40
Exchange PI., N.
Teletype NY 1-1825 & NY 1-1826

Railroad Securities

and

to Other

Singer, Bean
Mackie, inc.

&

Public Utility Securities

a n r a
nee

they buy municipals because
they
Yield enough, irrespective of

advantage

more

41

when the yield has
been such that

tax

on

Our Reporter's
Report

r
r n

bonds

sufficient to

'There

the

isn't

Request.

securities

25
es,

Request.

on

We maintain
trading markets in
250 over-the-counter

5

today big buyers of

due
to

23

Observations—A. Wilfred
May___

re-

f gu

on

**Prospectus

than

$2,000,000. The

insurance

exemption

great deal
not

t

u

Manufacturing Co.
Pacific Uranium
Mines Co.

'

News About Banks
and Bankers

°nn

Properties, Inc.**

CoastLeaseholds, Inc. *

42

Our Reporter

+v?InSd
Recording to the latest
J*} JsnH^n *?i
$12,400,000,000 and
big mutual life

not

Mills, Inc.

Hycon

11

8

We don't have any good breakdown of where tax-exempt bonds
?re held because, of course, the

Gulf

*Circular

Bargeron____
___

make

we

most

Investment Field

From Washington
Ahead of the
News—Carlisle

of that in munici-

Dan River

Food Fair

4
are

out before the
made.
We can do

pals

British

___

WILLIAM

Albany

City

Corpus Christi Refining Co.

12

___

pretty well sounded

ments

in the

Dealer-Broker Investment

insurance

bonds, if they

Stocks
20

companies, the savings banks, the
pension funds, are known
buyers

of

Insurance

_

organizations, the big money in-

vestors,

and

Business Man's Bookshelf

The

TELEPHONE HAnover 24300

branch office in

Lake

Cover

we

BROAD

to

(Editorial)

Published Twice

25

Exchange

New York 4

Teletype: NYl-4643

Direct wire

44

have specialized in

Broadway,

DIgby 4-4970

Regular Features

a commitment
as
true of corporate

City Stock Exch.

Spokane Stock

_

Se£. r,°;^nivers"y' New Y°rk Ci,y'

For many
years

J. F. REILLY &
CO.
Members

__

I. T. & T.

dealer, or those that
underwriting municipal issues,

[s much

Shawano Development

____

i'fi

say

by

13

Word!

The Working of the
Anti-Trust Laws
—Richard B. Heflebower

where

made

the

Robinson-Patman

—Jesse W.
Markham___

know

to

Sienkiewicz

Policy: Flexibility Is

Economic Aspects of the

going to

fair

A.

15

Reserve

,—R. L. Weissman

to be sold, but
municipal underit

Banking—C.

14

Federal

-

likely
of

Maule Industries

12

New Frontiers in

con-

know

Chesapeake Industries

11

issue

are

WALL

STREET, NEW YORK
Telephone: WHitehall

6

W. Babson__

who

an

of

Obsolete Securities
Dept.

5

Business and
Government: Are They
Natural Enemies?
—John S. Coleman

difficult

don't

we
we

all.

field

companies

,

The

Adams

Revolution in Materials
—Elmer W.
Engstrom

term

„

municipal
are

Municipal

to figures,
encompass the whole field
thought that we ought to

just

general

it

where

are

the

that

rather

the

Growth

and

Electronics Means

a

writing I think

issued

However, in referring
will

the

»

that

them

some

Housing

I will

here

seli

are

Obligations
I

ask

Street!

the SEC
H.

Dispelling Doubts About
Sterling—W.

one that is
batted
good deal and little un¬

a

ourselves

'

The

and

underwriters,

is

not attempt
subject of Public
Housing bonds or Revenue bonds
because Revenue
bonds will be
discussed by a
subsequent speaker.

to

involved
to

template the purchase

larger Federal supervi-

sing agency,

volume
question

to get

7

con¬

we

exempt by act of
Congress
and, in order that
they may enjoy

the

is

year

Factories"—Roger

tax-

question to say where all
of these
bonds are sold.
When

Local

They

tax

by

"Brain

good many people.
I am
going to take a little time to
comment on that
later, but let me

Linen

Housing Authority
bonds, that
the

than

such

derstood by

also, of course,
would include
Revenue issues and
latterly it has also
included, because they are
tax
exempt, Public

tax

of

"tax exempt" is

sions of those
agencies.- It

Housing

compared

amount

present

proper

-around

subdivi¬

issue

a

question

poli-"

any

as

; buys these bonds and why. These
bonds, as you know, are tax
'.exempt., I have a feeling that this

ssessions

and

the

as

,With
is

municipalities
but

year

The

six

easy

99 Wall

4

cerned.

ob¬

ligations

this

1954.

Cobleigh

Railroad Traffic in
1965—James M. Symes

exempts is joff about 25% and corporate issues are
up about 10%,
so that
actually corporates are in
the
lead
in general
volume as

se¬

ing, this includesnot
only

with

Confronting

Are
3
at

U.

__

slight change during the first
months of

Corporation—Ira

HARD TO GET
PRICES

Cover

Municipal Bonds—John S.
Linen

—Commissioner Clarence

municipal bonds.

-

AND COMPANY

Housing Finance—J.
Howard Edgerton

Houdry Process

leading considerations
credit

in

The Broad
Field of

municipals, and stresses the
importance of an acceptable
legal opinion as to
validity of separate obligations. Discusses

,.

llCHTEIWfllt

"
Page

Through Credit Restraint
Cover

the held of public
borrowing, describes
the market for these
issues. Notes the value of
tax

the Boom

—Roy L. Reierson

broadening of

of

3

in

New

in

for

advertisements

York

funds.

for¬

must

GENERAL INVESTING CORP.
80 Wall

St., N. Y. 5

BO 9-1600

<

4

The Commercial and Financial Chronicle

(1068)

to strengthen
financial position by
retention of earnings. There

Thursday, September 15,1955

...

agement preferring
the company's

Houdiy Process Corporation
By IRA U, COBLEIGII

full

tive

Enterprise Economist

Some notes about the demand for

interesting

laden

patent

for

pioneering

company,

new

that Atomic

recent

turn out 100 octane clear

motorists have
hearing a great deal about
?igh octane gas and high comjression motors (not to mention
years

from

their

the

has but

idea

of

this

is

dim

a

what

all

about.

Why,
the

then,
for

pitch

more

com¬

and

tanes?
it's

mainly

motor

i

Ashland

Well,

matter

c

of

oc¬

pression,
higher

e n c

octane

e

y.

Oil

Oil

nental

"Scarce Money"

or

By PAUL EINZIG

Fund

additions
The

its

to

8,600

shares

Dr. Einzig comments

on the controversy in England regarding
of employing monetary devices against the
prevailing inflated consumer demand. Notes policy adopted
by British Treasury against further increase in Bank of

the

on

and Science and
recently reported

1955;

30,

Nuclear

is

&

and

include

Refining Co., Inc.,

Ltd., Conti¬
Gulf Oil

Company,

Corporation, The Pure Oil
Ira

f f i-

A

business

oil

the

Canadian .Petrofina,

a

of
U.

Cobleigh

n

number

Iraq.
Oil

by

Houdry holdings.
actually lies

England

here

romance

correct

in three things:

(1) the possibility
of broad application of the Hou¬

way

rate,
of

amount

and,

their

-disinflationary

instead, having

advances.

Sees

hanks

the

adverse

the

reduce

political effect of

measures

which would reduce

inflated

con¬

production and
ing plant with a capacity of 102,000 dry catalytic patents in the chemi¬
bbls.
a
unemployment.
day.
The plant will be cal, petroleum, food processing,
completed in 1956.
It will use, rubber industries, and in nuclear
LONDON, Eng.—A lively con¬ theless, the contention that dur¬
under license, the Houdry Process energy development; (2) the for¬
catalytic patents.
The Sun Oil mation, on May 21, 1955, of a new. troversy is proceeding in the Brit¬ ing a period of rising prices most
ish financial press as to whether borrowers are willing and eager
Company plant at Marcus Hook, chemical subsidiary to manufac-.
the
correct
way
of
employing to borrow at high interest rates on
Pa. and Toledo, Ohio are Houdry ture and sell catalysts useful in
monetary de¬ the assumption that there is cer¬
Process Catalytic Cracking Units. food processing; and (3) the king
vices
against tain market for their goods and
As a matter of fact, licensees of size law suit Houdry Process Corp.
the prevailing that their profits amply cover the
instituted
against
SoconyHoudry read like a Who's Who has

Yet

average

owner

gasoline,

building, 15 miles south of Wil¬
mington, Del., a large cat crack¬

trade-

in prices).

drilled in

Associated

Tidewater

interest

in high

oil

crude

Money"

the

Development Mutual
held

Inc.

Fund
June

In

them

in

taken

perceptive investors, and the fact

methods

upgrading crude oil.

been

interest

of

because

however,

recent

an

pretty attrac¬
future of Houdry

the

about

shares,

high octane fuels, and

The British Alternative—'"Dear

be something

must

^

pany,

ard

is the

automotive

engineering measure of the knock¬

characteristics of an engine.
higher the octane, the less
knock; and the higher the com¬

Com¬
Richfield Oil Corp., Stand¬

Oil

Co.

of

California, Stand¬

Mobil

Co.

Oil

alleged

patent

sumer

is to

peanuts. On June 16, 1955, Houdry
Process

Corp. asked leave in

Federal

District

Court

to

(from

million)

$21.7

of damages

Company of California.

ny

the

t

amount

(The suit is 2lA

Mobil.

rate

induce

banks

to

i 1

a

Such

claimed against Soco-

demand

or

the
cur-

credits.
a

con-

troversy

years

could

not

have

processes
of old.) Houdry is also seeking tre¬
arisen in t h e
ble
damages on an unspecified
Houdresid Cata¬
old days when
amount, alleging that
infringe¬
lytic Cracking Process for con¬
"dear money"
pression, the greater the efficiency
ment was "wilful and deliberate."
verting residual oils into valuable
Paul Einzig
was
practical¬
in converting fuel traction power.
Houdry contends that too Sonocy
distillates; Iso-Plus Houdriform¬
ly
synony¬
So, since we all hate knocks and
"air lift" process of cat cracking
ing, gleaning 100 clear octane from
"scarce money."
mous with
Any
love power, the day is only a few
heavy naphthas. Houdry has fur¬ (licensed since 1949 by Socony), increase of the bank rate
usually
years away when we'll be urged
ther developed a method for mak¬ is substantially the same as the
achieved the desired end of credit
to
buy
the
new
Chrylincollac
Houdriflow process. This is a com¬
ing Butadiene and Butylene, hav¬
cuts
because
it induced
debtors
Super Satellite 8, using 105 octane
ing a $3 million contract with plicated suit and the lawyers will to
repay their loans and potential
gas in a motor with a 12 to 1 com¬
Phillips Petroleum Corp. on these surely have a field day. If Hou¬ borrowers to abstain from bor¬
pression ratio, and generating, no
products. Houdry patents are also dry should win it, you can figure
rowing.
doubt, a paltry 400 H. P.
important in synthetic rubber and for yourself the impact a favor¬
But
In existing conditions, however,
enough
of the prophetic
a
$10 million contract with Fire¬ able decision might have on Hou¬
fantasy—how do you make this
the increase, of the bank rate to
stone has been under negotiation. dry common.
high octane gas?
How do you
Because of the vast and appar¬ 4i/2% has utterly failed to cause
Further, the Catalytic Construc¬
convert gooey black crude oil into
a
contraction of credit, or even
tion Company, a wholly
owned ently unlimited demand for high
the fluid they sluice out to you
to check its rapid expansion. This
subsidiary, contributed $54 million octane fuels, this Houdry process,
from
the
premium
pump?
By in
Kaolin, is the reason why Mr. Butler,
gross revenue in 1954 and the especially as adapted to
cracking—breaking up lowar level annual net from this division in¬ as a catalyst, seems to be in wide when deciding upon further dis¬
petroleums into more volatile frac¬ creased
135%
over
1953.
This demand on grounds of superior inflationary measures in July, dis¬
tions.
First, in the 1920's came branch
regarded the advice of those who
delivers, under contract, efficiency and lower cost. Houthermal cracking, a technique for
Houdriflow
and
Houdriformer dry's patents can also be used in urged him to raise the bank rate
to 6%.
converting heavy oils into gaso¬
Instead, he requested the
units, ammonia and titanium hydrogenation, by which refiners
line. Re-forming was next intro¬
lubes, waxes and banks to reduce the amount of
plants, and works on atomic ener¬ can upgrade
duced to convert low octane gas
their advances by 10% by the end
gy projects.
Persons closely fa¬ naphtha.
to
the higher variety by rear¬
This Houdry common
is of a of this year. There was evidence
miliar with this enterprise, how¬
ranging the component molecules
sort that defies the standard type of some immediate response, even
ever, believe that the biggest fu¬
under pressure and heat.
ture for Houdry lies in its re¬ of equity analysis. Balance sheet though it may take some months
The most recent stage is cata¬
before the measure could produce
search, its processes, and its patent position is satisfactory, but there
lytic cracking introducing an out¬
its full effect.
royalties, rather than actual con¬ is no history of high earnings nor
side material — the catalyst — to
lush dividends; and estimates of
Mr. Butler's preference for such
struction of units.
perform the conversion. And that's
future earnings are not easy
to direct intervention gave rise to a
You simply can't talk about a
what we want to talk about today
work out.
On the other hand, certain amount of criticism on the
scientific
development company
—cat cracking.
There are a va¬
viewed by the criteria of growth part of those who believe in the
without reference to management.
riety of cat processes today, and
The executive and research eche¬ stocks, Houdry has something to pure unadulterated automatic sys¬
a
number
of elements such
as
talk about; fine management, top¬ tem.
Their argument is that the
lons at Houdry have developed
platinum and alumina used as
reason
why the 4V2% bank rate
into a highly effective production flight customers, patents with ex¬
catalysts; but we're going to talk
potentials,
retention
of failed to check the credit expan¬
and research team, especially since citing
about
Houdry Process
Corp.,
sion was that, high as it may ap¬
the induction on Jan. 3, 1952, of earnings, wide possible use of its
owner of a number of patents re¬
products in many industries all pear in the light of the cheap
Mr.
Chalmer
C.
Kirckbride
as
lating to catalytic cracking and
over
the world; and finally an money experience of the last 24
President and Chairman
of the
now working in close
association
out-size
law
suit that,
if won, years, it was
not nearly high
with
Minerals
and
Chemicals Board. Mr. Kirckbride is reported
deliver mink-lined divi¬ enough. It was pointed out that,
to have set, among other goals, might
Corp. (stock listed NYSE) in the
dend
checks
to
Houdry
share¬ since the price level has been
a book value for Houdry common
use of its Kaolin clay as catalytic
holders.
Stockholders who have rising at a rate of something like
of $150 per share by January 1962.
agent. The large French chemical
staked their hopes on law suits 5% per annum, anybody borrow¬
It was $15 a share when he took
company
SECA, a large French
have
had
a
pretty low batting ing at 5% has for all practical
the helm.
glycerine company, and other large
Now let's talk about the com¬ average historically. But there's a purposes the use of his creditor's
enterprises in Italy and England
lot more to Houdry than a law money free of charge, because the
mon stock.
The total issue is but
have either signed contracts or are
suit parlay.
Houdry relies on its real value of the amount borrowed
300,000 shares ($10 par) trading
working out agreements looking
over-the-counter' around
41%. process rather than "due process"! plus 5% at the end of the period
is the same as that of the original
toward the use of Kaolin clay ap¬ Those who view this
equity solely
amount was at the beginning of
plications under Houdry Process from the standpoint of current
the period.
patents. The first European Iso- earnings and dividends will not be
Of course in practice things are
impressed. The per
Plus Houdriforming unit is to be particularly
not so simple.
Debtors cannot be
share net for 1954 was only $1.20
built at Ravenna, Italy, by Hou¬
BALTIMORE, Md.—Richard A. certain that prices will continue
after write offs of about $4 a share
dry Process Corp. This plant will and no dividend was paid, the man- Jamison has become associated to rise. Moreover, money is bor¬
with Mead, Miller & Co., Charles rowed
not
for
the
purpose
of
and Chase Streets, members of the financing the production and sale
ESTABL1SHED 1894E
New York Stock Exchange.
of the late Irving Fisher's pro¬
Mr. Jamison is a graduate of verbial "goods basket" which con¬
STATE AND MUNICIPAL BONDS
Brown University and was con¬ tains a little bit of all kinds of
The

Newest

Houdry

patented

include

R. A. Jamison With

Mead, Miller & Go.

with

nected

CORPORATE BONDS

Equitable

Trust

Company of Baltimore from 19351948.

LOCAL STOCKS

He

Colonel.

1955,

Robinson-Humphrey Company,Inc.

in

was

1941-1945

The

the

and

From

he

was

the

Army from

came

1948

out
to

Chairman

at

Lt.

August,
of the

goods
making
up
the average
price level, but for financing op¬
erations
in
particular kinds of
such

WALNUT 0316




ATLANTA 1,

GEORGIA

LONG DISTANCE 421

And

ducer may or may not be

Hornblower Weeks Adds
DETROIT,
Miiller is

W eeks,

now

Mich.

—

Arnold

G.

with Hornblower &

Penobscot Building.

even

if

it

No

crease.

his

to

does,

borrower
it

take

interest

wiped out by

their pro¬
able to

benefit of the in¬

derive the full

sition

(Special to The Financial Chronicle)

is

ful

whether

stances
would
to it.

in

even

existing
6%

a

perform

doubt¬

seems

the

circum¬

bank

rate

task

assigned
if the Chan¬

Needless to say

cellor

were prepared
to go much
higher and raise the bank rate to,
say,
12%, he is bound to cause
a
sharp contraction of credit and

relapse in

a

ble

prices.

statesman

prepared,

No responsi¬

today

however,
of

consequences
which

in

such

be

risk

the

measure

a

more

result

would
to

this

likely than not would
disastrous slump.
For

a

the

reason

bank

of

argument

the

rate school

that a very high
rate is preferable because it would

only have to be applied for
brief period
vince

a very

is not likely to con¬

Mr. Butler.

Beyond doubt, even a 6% bank
coupled with the other dis¬

rate

inflationary measures is liable to
discourage borrowing to some de¬
it

But

gree.

maintained

have

would
for

to

fairly

a

be

long

period and this would entail

con¬

siderable additional burden to the

Treasury, the balance of payments
and the national

economy in gen¬
In addition to having to pay

eral.

high rates
other

on

Treasury Bills and
liabilities, ma¬

short-term

turing debts would have to be
financed

is

largely

whether

terms.

matter

a

the

rive any

re¬

It
of argument
Treasury would de¬
expensive

on

compensation from a re¬
national
expenditure

of

duction

price
that,
amidst conditions existing in Brit¬
resulting

level.

ain

the

from

immediate

nounced

and

revenue

on

are

would

effect

the

today,

more

lower

chances

The

more

than

be

pro¬

on

ex¬

penditure.
the

to

holdings

large

overseas

sterling claims the
payments would have

of

balance

of

to

tne

bear

burden

of additional

interest paid to overseas
able

on

rate

and

creditors.

is by no means neglig-

This item

the basis of
would

a

4V2% bank

become

on

the

basis

Producers,

too,

would

preciable

very

ap¬

of

6%

a

'•ate.

LU

nav

the

tor

more

their

have to
of

financing

And this would

operations.

to increase their cost of pro¬

tend

duction at

a

time when,

owing to

the cessation of the rise in prices

would not be in a position
on to the buyers of their

they
to

pass

In-

goods the additional charges.

How to Make

a

Killing

in Wall Street
and

Keep It!

" ■
-

,

out?

■

Up-to-date,
revised edition!

sion.

RHODES-HAVERTY BLDG.

charge,

it

reason

Presents in brisk and

Maryland State Aviation Commis¬
.

For this

goods

The

of

interest

may or may not rise to the same
extent as the average price level.

goods.

price

additional

broadly correct.

raise the

bank

the

Phila¬

in

delphia, to increase to $52,773,464

ard Oil Co. of Ohio and Union Oil

ing

for

This suit is not for

infringement.

for

in the value of

a

po¬

check

or

would
be
corresponding rise
his goods. Never¬

McKAY

m

for

amazing market gains. To get
your copy

granted that

charges
a

is in

readable style a formula

■

just tear out and send

money

order for $1.50 to
Dept. 1, 55 Fifth Ave.,
New York 3, N. Y.

■

Volume 182

Number 5464

deed, the only condition in which
high interest rates would tend to
produce the desired result is

SomeProblemsConfrontingthe SEC

pre¬

Observations.

cisely that producers should feel
discouraged from increasing or

5

(1069)

The Commercial and Financial Chronicle

...

•

By CLARENCE H. ADAMS*

•

Commissioner, Securities and Exchange Commission

maintaining their output.
All these

By A. WILFRED MAY

disadvantages could be
if, instead of raising the

avoided

banks

to

credit.
ment

Even

has

it

end

curtail

legal

reckon

cooperation

banks.

WHAT "MARKET"?
The

ing

stocks, the net

part

change

The

number

on

failure

In

of

his

of

the

whose

the

whom

gate

policy

traditions

evidence

•

before

market's

ement,".

; The

i
A. Wilfred

„

May 1

that

in the

even

of

banking system.

persevere

when

the

disinfla¬

tionary measures begin to hurt.
They can only produce their ef¬
fects by reducing production and
Should

the

Govern¬

ment be prepared to face
this

out

having to raise the bank rate to
prohibitive level for a short

period

ately

to

or

a

relatively moder¬
high level for a prolonged
seems
unlikely that Mr.

period. It
Butler

will

allow

himself

be

to

persuaded to choose the riskier
more

expensive
cut

money

of

course

sheer

of

or

dear

ideological

dogmatism biased in favor of the
100% automatic system.

R. L.. Scheinman Partner

ship
120

be

in

admitted

R.

L.

members

of

Exchange.
with

the

to

partner¬

Scheinman

&

New

York

Co.,
City,

New

Broadway,

York

Stock

the

York

stock

sary

1 i

e

t

that

rl

p

Stock

-

for

the

of

'Exchange,- reveals

*

'

*

No. Issues

Rose

Sept.

6

Composite

Declined

Average

..

*

561

353

.+

-74%

497

444

-F

.13

534

495

+

.22

479

436

+

.03

505

459

+

.17

*Total__2,576

2,187

"

7

"

8

"

—

—

9

"

—

12

__

—

some

time

as

were

or

.*

/

common

recorded

stocks
to

of

inaction

General

issues

declined

the

10%

by

latter

or

group

Railway Signal (up
net); Inspiration Copper (up
7%); Superior Steel (up 10%);
(up

7%); American Viscose (up 5%);

the D. J. Averages for the month:
30

industrials, up 50%; 20 rail¬
roads, down 66; 15 utilities,

down

74.

current record of

following

con¬

some

and

industrials, rail¬

utilities

the

during

of

the issues which
concurrently de¬
clined
American Machine and

Foundry

(by

4%);

(by

past week.

(by

Industrials

"

Bath (by

3%); International Paper
2V2%);
Seaboard
Oil
(by

(by

15

6— +.78%

Sept.

3V2%); Chance Vought (by 6%);

20

Utilities

Railroads

+.19%

+

.96%

.94

7__— .22

"

—.10

+

8__ —.03

"

2V2%), etc.

+.21

.10

—.22

+.71
+ .43

9__

"

—

12— +

.40

—.33

.01

—

Most of these declines occurred
at

stand

we

levels

far

below

the

*Total_ +.93%

year's

♦Net

change

over

on

the threshold of

—.65%

+3.03%

continue to

will

areas

new

made

beginnings
be nurtured

small

from

will

along

with

to

need

The Securities and Exchange

Commission
such

that

is

Production

capital shall be forth¬
at the same time,
who

those

asked to fur¬

are

nish it shall be given an adequate

of the risks involved

description
so

to

as

the

provide

reaching

an

Retail

Examining Mines in

Price

Auto

Industry

made

been

speculate

successfully

Production

these

not

competent
take a trial

As
the

Canadian

the

strive

we

a

Filiate

BABSON

famous

tion.

Canadian Mines"?

on

to

trend

The

Wednesday

industrial

of

last

production

continued

week

above the level of

possible exception of

preventing

of

frauds

a

a

in

the period

point

to

year

ago.

somewhat diminished

copper

With

below

the

decline

For

of seeing to

bulletin

staff.

month

of August the

our

MINES"
trial

CANADIAN

...

a

costs
only
have the same
terms and regulations as app'y to
regular subscribers. Just clip this
advertisement
and
send it with
your
cheque or money order to
three

$11.25.

13.

In August

employment

last

was

not

year,

just

The decline in

record

are

based

on

1953.

the week of Aug. 7 through

employment totaled 62,300,000, while un¬

over

3,200,000.

you

CANADIAN

especially large for this time of year" and was smaller than
other postwar years, the joint monthly report of the

Commission Building
Toronto 1, Canada
cfC

Harbour




of

3(b)

the

1933

as

the Com¬

prescribe as neces¬
appropriate in the public
or
for the protection of

or

sary

conditions

may

interest

investors. Pursuant to this author¬

the Commission has adopted

ity,

several regulations, including Reg¬
ulation A for securities of domes¬

commercial

tic

industrial

and

D for

companies and Regulation
securities.

Canadian

small

Most

public financing is done un¬
regulations.

scale

der these

has been

Commission

The

par¬

ticularly concerned for some time

Aug. 30,

Columbia,

to

respect

securities issues offered to

new

the

with

evident

enthusiasm

public by new business ven¬
of all types.
The stock of

tures

uranium

organized

newly

com¬

panies has especially caught and
imagination. Many

held the public
of these
under

under

offerings have been made
A and a few

Regulation
Regulation

D.

The

concern.

1955

26,

May

and Labor Departments stated.

The record employment total and

room

can

of

Se¬

ing and Currency stated:
"During the hearings, evidence
offered of considerable specu¬
lative fever in small issues.
This

was

evident

particularly

was

sales of uranium stocks,

in

of all

for investment in

The abuses uncovered ranged from

Continued

on

page

projects

end of the Turnpike to the other.
capacity

.

.

.

Delaware Valley,

...

people already employed in the

$600,060,000 IJ. S. Steel investment at

Morrisville.

Pennsylvania means more than steel. It means chemicals,
textiles, machinery, financial institutions—any number of investment
But

opportunities. Here are just a few Pennsylvania
huy and sell, or make our own markets lor —

stocks that we

Philadelphia National Bank

Giant Portland Cement

Smith Kline & French

Girard Trust Corn

Laboratories

S. Morgan

Co.
Exchange Bank

Hajoca Corp.
Hogan Corp.

Co.

Warner Co.

Pennsylvania Co. for Banking
& Trusts

Smith £0.
Strawbridge & Clothier
Tradesman's Land Title Bank
Trust

Latrobe Steel Co.
Penn Fruit Co.

the July to August drop in

Plenty!

Pennsylvania?

staggering growth potentials in

To the thousands of

the survey

noted.

Washington Steel Corp.
Williams & Company

longer

factory

work week

in

August brought weekly

earnings of the average factory worker up to $77.11, a new
for any

Trading Department

This percentage figure was also the lowest since

November, 1953.

high

month and 75 cents more than in July, according to

Continued

on

the
30

page

50%

offerings of $300,000 or less.

1955.

read the signs from one

the

which to¬

day comprise approximately

From western steel mills still running at
To the

ma¬

jority report "Stock Market Study"

PENNSYLVANIA
Boom

this

We have not been alone in

joblessness brought unemployment to 3.3% of the total labor force,

REPORTS

LIMITED

mission

Vancouver, Brit¬

Foote Mineral Co.

unemployment between July and August "was

some

Commerce

The
BABSON'S

601

a

months'

and

Association

Administrators,

Inc.

government reported

total

The Federal statistics

in

fortnightly
service.- "REPORTS
ON
test

Commissioner Adams

were

comparable 1954 period.

the

250,000 to 2,200,000, the lowest since November,

can

supply,

of 65,500,000, about 500,000 more than the
previous high reached in July, with a drop in unemployment of

continually

You

with the

in

on our staff is
making field trips on
which
he
personally
inspects
mines
and prospects. His find¬
ings are discussed with our con¬
sulting engineer and with our

engineer

by

National

the

on

the nation's labor situation, reports show a
total claims for unemployment insurance

respect to

employment

exoerienced

ended'

Materials,

in this
difficult field. The fully qualified
mining

address

remaining

upward,

plentiful.

the

guidance

possible

best

the

disclosure is

fair

and

full

in

to

curities

organiza¬

provide

that

You

noticeable

of

of

comfortably

subscription to Babson's service:

"Reports

in

function

Commission's

raising of capital is essentially

before

Business Failures

Section

to

of the Senate Committee on Bank¬

money.

*An

Index

under

J

on

need

you

Why

advice.

in

in issues

fair run for

where they will get a

ish

stocks, but to

mining

so

prospective
investors.
Once such disclosure is made the

Canada for Investors
Canadian

fox'

Index

Food

and

for

taking such risks, and that those

made

Trade

Commodity Price

means

informed judgment as

the probabilities of reward

to

it

Carloadings

State of Trade

concerned

most

but,

coming,

their

Electric Output

The;
Act

limited

sale of securities and
Steel

1933

exempt from registration.
Commission
is
empowered

are

with the problem arising out of
amounts of the willingness of some to take un¬
fair advantages of the speculative
capital raised from public inves¬

which

one

The

or

depth of which no one can fore¬
see.
Many of the developments in

who do invest shall do

period.

new

the breadth

scientific frontiers

that
D-J30

Continental

10%); Bendix

en¬

that, while the old geo¬
graphical frontier has disappeared,

tors.
are

of

Act

terms and

to the

parent

be

Divergence in group movements
is illustrated in the

Commission

the

Securities

business

large

'

these

Divergence Between Groups

roads,

here

was

with

the

and

unless they are

ability of new

measure

were:

midst the following net changes in

etc.

Contrariwise:

facts

adopt' regulations exempt¬
ing
from registration
offerings
not in excess of $300,000 on such

in

due

terprises to
Clarence H. Adams
by 10%; Yale & Towne by
obtain funds
11%; Reeves by
11.7%;
White
from venturesome investors will¬
Sewing by 16%; Libby McNeill
by 13%; Delaware Lackawanna by ing to speculate on the develop¬
ment of the country's abundant
14%; and Phillips Jones by. 18%.
natural resources. Today it is ap¬

10%); TransamerBarker Bros,

industrial

o

greatness

more.

4%

Wesson Oil (up
ica (up 6V2%);

t

■

-

States

RKO

+ 1.29%

registering sizable
advances'
new
highs during this period
market's"

United

These stock movements occurred

Among the listed

the

interstate

of

or

commerce

registered
under

The

securities

mails

foreign

The rise of the

the

have

the

of

'-such ventures.

fell by percentages up to 6%; 106
stocks declined from 6 to 10%; 17

highs.

controller.

Fortunes

neces¬

funds for

tp 6%;

up

110 stocks advanced by more

Among

♦During the 5 days.

"the

advanced

Contrastingly again—468 stocks

Stocks
No Issues

issues

than 6%.'

Movement

'

evaluate

In. general, a public offering of
securities canriot be made by use

common

total'of 300 NYSE

a

stock

of D-J(i5

Mr. Isaacson has been
firm

investor, must

.

ing the raising

and
:

*

Insurance

Sept. 15 Frederick O. Isaac¬

will

son

are

.

-

—

On

Administrators

Securities

by the Dow Jones Com¬

compilation by H.
Hentz & Co., members of the New

al

u

Describes

uranium companies.

SEC's recommendations for its amendment.

A breakdown

Exchange,;

un¬

popularity it would be well in a
position to carry through the re¬
quired degree of disinflation with¬
a

i d

v

i<5<:iipc

employment which is bound to be
unpopular.

di

the New York Stock

on

The ques¬

tion is will the Government have
the political courage to
course

n

as

principal features of Regulation A, and the grounds for the
proposed revisions. Comments on the Fulbright Bill and the

.

is characteristic:

restrictions by his direct approach

this

follow¬

common

such

ventures,

new

498

'

prohibitive
interest
fates, Mr. Butler will be able to
enforce a high degree of credit

in

un¬

•

banking system from this
point of view., ;
.'

to the

tain

advanced:

always confronted with the prob¬ and make his own investment de¬
The Commission has no
posite Average of 65 stocks—was lem of how best to protect those cision.
"trendless,". the
market's .com¬ who invest in new and specula- authority to pass upon the merits
ponent issues were far from stag¬
t i v e business of proposed financing and there-,
nant, manifesting the opportunity
-ventures fore possesses no veto power over
for achieving investor comfort or
without
u n proposed offerings.
discomfort.::. ' '
duly hamper-

.'. daily rises and
declines of the

British

than

month ;of August,
market-as-a-whole, as

the

measured

ing record of
j| '/{the past week's

Secretary of the United States'
Treasury, Mr. Snyder, grew al¬
most lyrical in his
praise of the

are

while

abated.

mer

absence

issues

on

more

the

During

as

\ continue

for¬

week,

The August Picture

re¬

to

"the

a

this

of

aggre¬

m o v

,

.

in

is

ferred

for

Congressional Committee the

The chances

Tues¬

speculative business ventures without unduly hampering the
necessary funds for such ventures, Commissioner
Adams calls attention to the speculative enthusiasm for cer¬

against 431.

the

of

out that the most difficult problem of security
how best to protect investors in new and

raising of

Average

high

a new

declined

loyal cooperation with the author¬
ities.

reaching

day

far reaching

on

established

was

Industrial

the

dividual

depends is very small and it is a
very disciplined community with
well

While

strong cross-currents mark¬
the price movements of in-

that

banks

or

to

power

the

on

commercial
success

of

volume

though the Govern¬

no

can

British

the

In pointing

administration is

level of interest rates, the author¬
ities
succeeded
in
inducing the

Merrill Lynch, Pierce,

Fenner & Beane
NEW YORK 5, N.

70 PINE STREET

Offices in 107 Cities

Y.

24

6

The Commercial and Financial Chronicle

(1070)

miles—or

Railroad Traffic in 1965

will require

eration of
An

railroads during my

our

+

i«_

dustry

has

been

de-

.+

40

years' association with the inthe

nrill

o

the

and

bottle-neck

leveled off and

railroads

participation, they would be

lion

last

miles —53%

ton
year

and

—

Share of Transportation
Now

I

d

for
u

enough

one

'fh

,.

2SS

f

believe that 55%

to

their

with

million

r.

n

on

railroads
than

more

of

some

First

by 1965—

minimum

the

s

a

is

It

-

finally

becoming

railroads

still

on

factors involved, but I

factors involved, but I believe the
believe the

th«„

of the past can be
used as a rather accurate guide
for the future. If we take the year

taxed

experiences

1954

find that our country,
162 million people with

we

with its

Gross
billion,
development alone on the part of trillion
General Motors is saving the rail-, height
performing quite satisiactorily. I would guess that this

a

minimum

a

of

$500 million

though the savings

year-even

have been taken away from us by
the "squeeze" of inflation—with

ihe

initial

investment

do

if they

to

are

in

any

rooniaM

being

paid

National Product of $357
required a little over a
ton miles ot mter-city
traffic by all transport
agencies to meet its needs. (Remember—a trillion is one thousand billion.) Without burdening
you with calculations and staggering figures, suffice to say over
a

J

'

1

off iii three to four yesrs

the period of years there has been
r
y
r-—

How

anrl

governed, regulated and

are

petitors.
at

dniiornoH

oro

they

their

to

contrast

I think today,
time in many

hoinn

being

now

—

jc

eoinp

to

cost

commonly

lot

a

of

monov

^ goinS to cost a lot ot money,
rolling

stork—cars

ocomotives - and

^cements'

and

and

cars ana

much

beyond

reauhements

aJji+in_Ql

Au

of

aware

and

the

fact

T

+

for

!!

i

-more

F

J3

^

...

p

•

that

strong

a

progressive railroad

industry

of the-greatest assets to our
peacetime economy—and is absoone

lutely essential to our national
defense. The recent report of the
Cabinet Committee to President

.„JL

with

th

hmn

e ^
f what wishful
not „,wYlce;
like to

f'° S|f®

"Train

conceived
its

bv

first

1^47

i

of

Osborn

Cv

rnihlir

made
in

annearanre

inno?a«ons IS

with many

passenger train

Tomorrow"

equipment—and

from that development came the
'Mnmn1'

dome

tinnc

nf

nar-

e

are

order

some

now

descnp-

many
cn

nnnn

»a.'

,h,

There

rinomuii

mnn,,

oi

car

whmh

in

in

ton

railroad eciuip-

L

rdthfnr

its

rn

potential service
Penaence
1 e
Railroads will have to be re"aI1™aas wni nav
an" 'fa"angea
removing

f

t

j

It

,

.

n

(

C11

.

jnt
lJU1111

LU

of the last
tne

cars

"dome"

with

features

some

they

some

commonly
service"

—

railroad
1

and

behind

flat

cars

—

put

what

a

and

which

very attractive and

'

profitable piece of business for
the

•

rail

carriers,

those who
of

well

as

operators'

truck

as

the

the
VAAV

meet

invvv

needs

of

hvvu»j

VJ.

the

themselves

—

taking advantage

it.
.

development

over

diminishing

Nation.

„

#

Second

need
Wov

for

We

a

evefpm

all

more
in

.

recognize

adequate

aiin\4/

thn

the

high-

tbe

nnr

natjon's

transportation

£*h"a"""!in

the period

M0

So,,

tfJSJ

lota] investmen£ inclusdin^.
p^er Wa.s
a!:)01u^
$350,000. The service offered by

£he

trains

such

then

uaiII» "iei1 waJ acceptable
acceptable.
I e publlc and at fares that

P^duced
V

1

was

profit.

a

competition

With the

coming

into

coming

new

being

into
being
buses' airlines, and private
,

lrom

automobiles

the

service

byth^teaSpment

was

offered

not

accfnt-

8ble t0 the public and i4 begatl
leaving the

railroads quite
attempt to

rap¬

their

In

stop

this rapid erosion of passenger
travel and to hold the travel to
the rails required improved service—in the way of air conditioned
and

so-called

luxury

and travel comforts
that added substantially to the cost
reduced its

capacity.
It was also
necessary that a new type of mo¬
carrying

p0Jer

tjve

modern
of

trains—in

(hese

these

the

in¬

comfort.

and

speed

Qf

reasQn

to^aul

be uged

more

terest

By

changed

condi.

recognized in

Vnd

ve.rs

...

,

thev
.

», hum

"1 'he coming '0 years ls
legardless
£ wh
the
g

equipment
^

and

—

amQunt

that
^

is

$30o.OOO.

around

aiuwuu

Then

^uv/u.uuu.

after
A
sums

f0r better equipment to meet com-•

petition, it

Pare?

impossible to raise

was

nPearIy

a'ywhere

surate

with

the

commen.
increased costs

aS because of this v^ryivio nrinpinoi
same^omrmiiiinn
Q-nri iVmi ic

hPv

our economy as

n..

_

to

spending these much larger

needs

tne next iu years, and tney are

nwnprs

way system to ailow the owners
inrrpasinff automobile non-

ol

this
one

country

freight

should

trillion'550

traffic
ton

Y"11 receive from their expend;-

petition—and that is the principal
reason
for the heavy losses now
being sustained by the railroads

!?.»«"
tions.

"""

about

hag

So—what

^

very

is

be

to

done

about

serious passenger los-

are

miles

or

,

er extent ,han th
are
toda
The economics o£ the initial
vestment dictates that they will

haye £o earn
they n0w do

more

than

revenue

wi£h

£rei

h£

cars

the

move only about
one-third hours out of

Third —The railroads are more
ag§ressive than ever before in attempting to meet the competitive
transport situation in this country

-both as ta p"clng and ^ervic,f~
,a£d with additional freedom that

increase 20 million, and trucks *s
u
.soon. bp forthcoming by —rebuilt plant designed to meet
and buses 3 million during this !aPPropriate legislation, should be tomorrow's reouirements and perPeriod — think what that alone ab!e to improve their present po- formance—and perhaps a new set
means! Based upon today's aver- sltI0nof rules and regulations governaSes the automobiles in service
Fourth — The establishment of ing the handling of freight cars
would have 35 million more tons "piggy-back" service will grow that will discourage rather than
of steel in them than they do to- rapidly—because it is truly in the encourage their use for storage

da^—2 million

public

trucks off the congested highways
and move them on the rail high-

—

more tons of rubthree-fourths of a million

tons of aluminum—and one
minion more tons of glass. Couple
more

M

rain developed by General Mo-,
tors and which you wi l see at the,
Powerama show is going to be a
se"ous cha enge to that problem

-because it is going to get us
back ™re "early to conditions
two and
that obtained years ago when the
the 24, there is plenty of oppor- passenger business >vas profitable
tunity to bring about this needed ~ when the capital investment
improvement. Most of it will come per seat could justify a c
from the technological improve- acceptable to the users of the
ments I speak of-from mechan- service and provide a profit,
ized terminals—improved signals
Now, for one. I don't hold out

'YYf f01' bo4h highway and vehi" actually™,,

in

approximate

billion

recogl?'zed 4h,at 4be better the ser}"ce 4^e railroads are equipped
£ render' (4bt be44eIthe serY,ee
thausers .o£ 4hat highway system

her

are

„

ineir

inter-citv

is

is growing in leaps and bounds
all over the country—and prom-

ises to be

canerelsonablyS assume3' that"

total

43% more than it was last year,
On first blush these figures might
termed "piggy-back seem on the high side-but with
moving trucks on automobile registrations expected

spearheaded

"push"

tram

lo-

a

ifin non
around $60,000.
around

"

""

cars

'

How

\J
for

the^experts are correct- cXdera«on oTfhTt program'"i Trlight^ca.^are going"■to have ses fb^f ar^ occurring? Well, to
Freight
going
the
lightweight
be"increased from IMmUhon expect. tba4 14
^metht0 he 40 be keot 011 4he move 4° a%e"at: i"®' ^ ,ligh4waigh4 passenger4
190 million

during

eventually research
and development will solve that
economic problem.

CQuld

we

will

to
by 1965 and the
bearings Gross National Product from $357
•for railroad freight cars-where
billion to $535 billion
the
the cost today is entirely too
same period-and
using the ex! high to economically justify the periences of
past trends then we
investment on a large scale —
the

where

happened,

■

development of roller

,

has

twentieg

ately $28 000-and

these

But if

The part they are playing in the

but

to
vv

"

of

conceived by GenMotors-embodied therein,

the

a new passenger coach for

™

"

S Z mZ%

on

or

that

is

hut

all

!«wl' cost
L
from

juessssR73s swia&mssrsaB

i.».

th.

service

—tne inflationary period
300 passenger carry¬

the

t
WUL

-n

loss?

tw™

r

miles

fcrease in ton miles

jnit

«

in

decrease

Here

Back

to

tions, plus of course inflation, the
of these coaches has risen
a™'°1rl
$28,000 in the twenties to
Eisenhower clearly states these L_eZmJ,/ T
around $150,000 today—and with
facts—and
proposed changes in jaiemem i mean mere w ii no iess seating capacity. The motive'
the national transportation policy
1 contl"ue t0 ^ a redistnbu- pQwer hauling the trains has risen.
ll0n
01
ra11

been

per dollai oi Gioss National Piod-

4»7iih

or

also

inn

»

ing
eral

marked

a

there has

million

.l0 3e. caroe..ot lPe °p?0_ of the equipment and

tha

ment

conti.nuous and substantial in- i am hopeful that we well soon
11"^ a"d
crease in the number of ton miles see legislation enacted that will
g
mar>y of the main
°f. uiter-city freight traffic re- carry out the recommendations of 11 es>
c'uired pe?' bapita' «ut du.ri"8 the that distinguished Committee.
.J.^uld wm^aUvel, estimate
same
that if the railroads are to meet
peyiod

$44

a

is simnle pnoush

wrefinements

a

the

in

answpr

eqUipment

+

might

P eciauon rates: snouia be

than
years,
the
are

^ s*°
\
and

thinking

com-

"

^

cn

,

was
operating at a
profit—and last year

cureTchallenee

the

idly.

it

resulted
The

called automation—and to do this

more

thinking people of this Nation

twenties

substantial

have^ indicated? capaacity"0C^r3

of the technological improvethat will be available to

•/

tremen-

when,
for
example,
on
the
Pennsylvania Railroad back in the

re-

ments

this

caused

dous loss from passenger operation

par-

truly

"

road

are

has

—

ticipate in the nation's available

low - cost
transport
is —how much freight business agency in this country, and that
will they be handling—and how jt is in the public interest that
they propose doing it?
As to the: they receive greater freedom to
first part of that question there; compete for business and someare, of
course, many
unknown thing nearer equality in the way

J

which have made between 2% and

roads

par-

that for these reasons:

say

recognized that the

are

to

aDie fiew roiling stocK

I

The principal question to answer

million miles and

What will the railroads be
quired

Commerce Com1

What

.

RaiI FaciHties Must Be Improved acquire

them

optimistic

am

of the Interstate

mission.

ters.

should be the

horsepower

Ihe

its

and

operating

33/2

and

emergency

.

of our country 10 years from now.

—

the

during

importance in that respect is be-

age

Why Railroads Can Maintain Their

Mo-

in

war—time

a

production

ev^rone kno^th^are

h

units

of

con-

The railroads will need consider-

AnflMfin,r

Diesel

this country under war-time
ditions could very well be

tirinntion hv the railroad industrv
ticipation by tne railroad industry

development

16,000

I have said
transport in

im-

the

our

than

more

PVPn

and better things to the
railroad industry in the future,
bigger

—

played in that

Symes

than

more

14%

tors

M.

as

occasions,

they ever handledlit.their his- imght traffic as I
tory-whieh was the war yedr of-Well

General

James

last

wo^dVean S^'bil^

tonnage, that

play in the transportation picture

—

than

more

55%* oTt^ total

handle

to

upon

part

2 3

a

all

we

portant

their

maintained

ton

lo¬

comotive

know

many

f

velopment
Diesel

Quite frankly,

on

upon

LrLr%t2Varree7?habniltt ^s0Ved00ked in 100 ma"y quarmiles—42%

enntrihiitinfS

ho

II.

be

1954

industry-and I am sure with
their "know-how" and with all
the resources at their command,
IVinxr

larger
share of the total volume—just as
was necessary during World War

the

Says there is a grow¬
ing appreciation of the fact that rail transportation is economi¬
cal, low cost transportation, and the public interest demands
that railroads be permitted to exercise greater freedom to
compete on an equal basis for business. Lists five construc¬
tive railroad developments now in progress.

$20 billion by the railroad companies.

The greatest single contribution
to the economic and efficient op-

called

much

If the distribution

investment of

new

railroads

handle

then by 1965 the railroad
called upon to handle
650 billion ton miles of inter-city
freight—17% more than last year,

Leading rail executive predicts that railroad ton-mileages will
a decade more than 50%, and to supply equipment
for this

the

and

to

10 years,

increase in

other facilities

volume,

would

President, The Pennsylvania Ralilroad Company

and

miles,

ton

ticipation of the past 10 years continued unabated during the next

By JAMES M. SYMES*

r
n

billion

557

If the downward trend in rail par-

Thursday, September 15,1955

....

interest

to

take

the

big

purposes.
An
freight car is

$8,000
too

to

much

(regardless of whose it is)

$10,000
money

to

be

much

rail

promise

for

I

element

is

jn

of

favor

believe
travel

too

air

much

of

service.

the

available

shorter

of

over

Realistically, the time

that

between

long-haul

distances

mean

1.000 miles.

the

business—and'. by

passenger

that

a

potential
to

the

factor

But

I

do

mass

railroads

metropolitan areas for
distances,
with
com¬

ways—where there is plenty of economically used for such a lim- fortable "sit-up" trains such as
capacity to accommodate them. It ited amount of storage space,
the one now on display here in
ingerated freight car now fastly
road highway program
involving is also in the interest of safety
Chicago, with a much lower cap¬
coming into being, and which
heavy usage of cement and steel that this be done.
The Passenger Business ital investment per seat, plus the
will eventually displace the old
__and
the 150 miHion tons proFifth—The beneficial effects of
Thus far I have been referring lower maintenance cost,' will enlce
box
cars
just as the ice duction
predicted by steel—plus automation are peculiarly adapted °nly to the railroads' potential able the railroads to ooerate such
j)x s
ave
been
leplaced in the
optimism of the coal people— to mass production
and mass freight traffic of the next 10 years trains at fares that will tap that
y ur °wn homes.
ar)d
famjiy income, after taxes, transportation is the biggest asset — their
possible
particination enormous potential travel market
Their
of

yea^s of the mechanical re-

tbjs

the

$100

billion

proposed

„

—

contribution

weight
opment,

to

passenger
as

the

train

light-

devel-

evidenced

by

the

train
on
display at the
Powerama show and to which I
will refer later. '
new

Yes

General Motors have

inbuted
liQ

ogica

substantially
piogress

in

to

the

con-

tech-

lailroad

*

""^""address
i."ai

Motors

by Mr. Symcs

at

the Gen-

Powerama, Chicago, ill., Sept.

195S-




expected

to rise from $5,300

to

in

$6,000

1965, with its

now

occom-

panying consumer goods spending. Frankly, I don't think the
figures

I

have

used

are

unduly

high.
Now,

to

railroads

participate

what

extent

reasonably

in

the

can

expect

the

to

transportation

the railroads have in meeting the
future heavy demands of trans-

therein—and

in this country—and

it

—and

in

the share

should handle.

the

railroads

It is based

on

10

the

change substantially
and quickly—with an accelerated

inter-city

freight

ton

things

and

of

produce
the

a

railroad

profit. On behalf
industry, I con-

right.

such

It

ureg

would

an

is

particularly

cause

^ bl ^"1-00'^™^^"

total

of the

The passenger business is gratulate General Motors for their
important part of the rail- forward looking approach in atNow
I
don't want to bp misroad industrv,
particularly on tacking this very serious railroad
understood
in
my
prediction of many railroads, that I would like problem.
traffic volume 10 years from now 1° discuss that situation briefly.
In summation, let me say to you
portation

simply must be reckoned with.

requirements of

our country. In
1954 they participated in 51% of

some

necessarv if the job is to be done

bon

of

the

important

tremendous

be-

losses

are occurring from its operasome $670 million last year

according to the full-cost formula

that if the railroads

are

going to

keep pace with the giowing needs

*tak"au'refognize
|bg

absolute

doing

so

necessity for their
our present econ-

under

;
;

Volume 182

Number 5464

.

.

The Commercial and Financial Chronicle

.

(1071)
omy—then they are going to have
to

be relieved from

present
as

brought

out

Committee

of

regulation

the

in

Cabinet

Report—they

are

large

but at the

—they
built

same

equipment

by the

the

If

that

require

body's

better

will

highways
$100

tvpes of

be

required

billion

just
Week at

Day
I

was

down

going

are

have

of

again

spent

to

built

Bache

&

New

York

New

Stock

Exchange

and
an¬

nounced

that

Charles
T

a

t h

Babson.

Fifty

The sooner local School

built

years

were

arch¬

as

itectural

d

a

and

taxpayers

and

towns

adopt

this
The

be.

will

community is its
children, provided they are prop¬
erly taught the right things.
I
have

every

little

use

for

silly subjects being

of

some

the

taught today.

Roger

W.

babson

to

-

city, — with
columns, fa¬
cades, and
fancy stone
trimmings. My
cousin had the

to

courage

make

a

radical

change and built

only to provide the most efficient

teaching conditions possible.
result
local

was

a

building

which

The

the

taxpayers dubbed the "New

Factory."

will

hear

word

for

These

materials
and

are

and

fed

are

the

finished

into

of

cloth

turn

out

the
one

products
Such fac¬

very expensive to

they will

amount

fancy

build;

the

same

shoes, clothing, candy,
with

50

people

that

is

produced by 500 people.

has

a m

These

joined

the

firm's

Re¬

ful

search

De¬

coming

partment

critics

were

more

truth¬

AUTOMATION has become pos¬

healthy,
happy.'

One reason for the

doors for

For

raw

in

ers

used

a

coming great

tronics

the

being

replaced

tors."

These

small

that

will

soon

by

be¬

tubes

These

are

tiny

"transis¬

transistors

hearing aids

are

are

being made with them, being built
the

'*n

frames

no

iiie

person

of

will have

one

is

deaf

"gifts."

point

I

the

to

hint that

a

and

come

important
refer

so

uses

a

of

great

teachers,

the

to

this

real

column.

opoprtunity

preachers,

and

But

by

used

power,

the

most

wonderful

factory," far
other

any

more

in

"automatic

marvelous than

existence.

With

a

is

and

will

be

labor,

by

of

such

every

time

is

schoolhouse

sible

only with

of Electronics

the

development

But—wake up!

illustrated

catching

up

Automation—as

with

TV manufacturer

light

chair

any

wires,

off,

on,

a

in

whereby with

or

(which I hope every

and

control such

an

they

own

efficient fac¬

"commercials"

remote

control

since

to

portant

c

Tatham,

dent

This announcement is not

an

ojjer oj securities Jor sale

or a

solicitation oj

babyhood;

an

tutional

Util¬

ity S

i

e r v i c e,

use

it

should

work

of

'

■

Schools.

M

i

'

'

•

September 15, 1955

I^c., has been
a
specialist in the
public utilities
field for 23 years.
He is a member
of the Ameri¬
.

.

can

Finance
York

Analysts,

Association

Society
and

of

in

and

$100,000,009

the

Security

1944-45

was

President

of the latter
organiza¬
tion. He is also a
past Vice-Presi-

C. I. T. Financial

dent. of toe National

Federation
Financial Analysts
Societies.

of

3%%

Gallagher Joins
Reynolds in Chicago

Corporation

Debentures, due September 1,1970

CuHICAGO,

111.—James P. Gal¬
lagher has joined
Reynolds & Co
i

as

manager of the
municipal bond
department of the firm's
Chicago

office, 39 South La Salle Street!
Gallagher was
previously as¬

Mr.

sociated

with

don.

McDougal

&

Price 98.575%

Con¬

plus accrued interest from September 1,1933

Chicago Analysts Meetings
CHICAGO,
ment

III. —The

Invest¬

Analysts Society o£ Chicago

has announced the

following

99aTo?l.meetingS beSirming
lodi)!
Sept. 22

Cleveland

Cliffs

Copies of /he
(who

pro-

be obtained from suck of the undersigned
the underwriters named in the prospectus) as mag

prospeel us map

are among

legally ojjer these securities under applicable securities laws.

Sept.
Iron

Company
Oct.

13

Kennecott

poration
Oct. 20
Republic
tion

(Field

ment

Oct.

pany

.

Steel
and

Cor¬

Corpora¬
Manage¬

Dillon, Read & Co. Inc.

Whirlpool-Seeger
Trailer

Cor¬

Lazard Freres & Co.

(Invitational Luncheon)
Westinghouse Electric

Goldman, Sachs & Co.

Spiegel, Incorporated (In

Joins Davidson Staff

is

now

Calif.
with

—

John

Davidson




Harriman Ripley & Co.

Glore, Forgan & Co.

Merrill Lynch, Pierce, Fenner & Beane

Smith, Barney & Co.

Stone & Webster Securities Corporation
A. G. Becker & Co.
Incorporated

(Special to The Financial Chronicle)

MODESTO,

Elyth & Co., Inc.

White, Weld & Co.

vitation Luncheon)

Co., Hotel Covell Lobby.

Salomon Bros. & Hutzler

Incorporated

Corporation

Garrett

Lehman Brothers

Com¬

10.

Nov. 17.

Kuhn, Loeb & Co.

Conference)

27.

Nov.

Copper

Trip

poration
Nov. 3.
Fruehauf

be

the

ojjer to buy securities.

New Issue

D.
&

Union Securities Corporation

Eaker, Weeks & Co.

but

have

how

using it? To teach stud¬

Insti¬

Charles Tatham

New

This power

e-Presiof

off

without

students

Utili¬

formerly

chair.

shut

to

one

changing the picture.
had

no

channel

the

Division.

Mr.

(with

room

change

enables

even

of

a

sitting in

person

a

noticed

prominent

a

while remaining in his easy

ents

that

I

you.

of

no cords) can turn a TV set

ing, writing, and arithmetic" and
recognition

a

television—is. fast

by

advertisement

an

many are

full

or

painting, poetry, etc.

good working knowledge of "read¬

a

brain

music,

as

the

charge

V i

when

The

force,

or

executives,

in

Public
ties

intelligent.

In
an

determine

and

than

all.
turn

not

can

product,

annoying

possess

ma¬

raw

her automatic fac¬

or

common

people

already

that
elec¬

tory will produce physical

It

they

this

knob"

parents of impresing upon young
that

These

addition, .students

flash of

hearing aid.
Now, let me

facing

eyeglasses

unlike

modern

automatically changed
muscle, brains, and cultural

into

so

now

'

•

are

cultural

sets

-

feed in

you

not

most

factory.

terials

radio

TV

Factory!

materials,

whether his

your

obsolete.

jk

process

by

used

and

be¬

and

water, air, and certain foods. These
pass
through
pipes
and
cook¬

increase in AUTOMATION is that
tubes such as are used in
come

should

prosperous,

Your Automatic

"electric

about

a

factories."

out the other end.

tories

now

is

"automatic

raw

but

talk

This

the factories where

are

end
come

stud¬

years

much

AUTOMATION.

by hand. This is
"electric eye,"

the

opens and closes

that

During the next few
ents

to

Tubes to Become Obsolete

^ Automation and Electronics

a

current

you.

1

ditions

of

by

student

every

come

one

a
change
by tempera¬

or

tory,

Elec¬

bv

off

or

sound,

instead

which

Commit¬

tees

on

or

illustrated

deserve.

hope of

school-

hcuses

„

Exchanges,

leading

my

foremen

cities

age

econ¬

Co., 36 Wall Street,
City, members of the

York

other

by

and

"factory" idea, the better off those

mer

.

Bache Research Dept.

fac¬

late Maior El¬

keep pace with the growing
our
country—which, ad¬
mittedly by all, is so essential in

Charles Tatham With:

efficient

an

electric

an

turned

light

ture

cousin, the
distinguished

needs of

and war-time

school

new

some¬

also

peace

as

power.

experts,

marvelous

an ooportunity of spending,
one-fifth of that amount of
private capital, so that they can

a

built

be

of

tory, with teachers working and
being paid as efficient managers,

a

given

omy?

will

dollars.

current, as illustrated by
loud-speakers of radios. (2)

enables

be

my birthplace.
As
writing this, I was looking

.say

both

Labor

brain

busi¬

a

few dollars to

a

billion

a

a

electronics

from

strong
the
It

at

that the railroads be

sense

and

automation

marvelous than any other in existence, i. e.,
I

money

lot of

about

Sees a great opportunity facing teachers, preach¬
and parents of impressing upon young people that they
possess the most wonderful "automatic factory," far more

during the next 10
years for expansion and improve¬
ment, don't you think it makes
a

talk

ers,

changeable

of the service.

users

hear much

teaching).- As

grown

only

over

■

and

and

new

will

is

American

tronics accomplishes two
things—
i(l) It enables a very faint elec¬
tric current to be turned into a

electronics.

time reduce costs

flow of traffic that will take place
—and they are going to have to

.provide

students

years

expenditures

of

ness

Commenting on the change to simple architecture in school
buildings, Mr. Babson points out that within the next two

going to have to be re¬
many instances to meet

additional

!'

of

are

in

the

capital

the

industry has

By ROGER W. BABSON

improvements which will in¬

volve

School

result

go¬

ing to have to be able to take full
advantage of available technolog¬
ical

High

"Brain Factories"

of their

some

"shackles"

7

Spencer Trask & Co.

an

im¬

Public
,

Financial Chronicle

The Commercial and

8

Thursday, September 15,1955

...

(1072)
International Minerals & Chemical Corporation

1955 annual

—

Chemical Corporation, 20
Drive, Chicago 6, 111., or 61 Broadway, New

report—International Minerals &
North Wacker

Dealer-Broker Investment

York 6, N.

is

understood that the firms mentioned will be pleased
to send interested parties the following literature:

Company—Report—Thomson & McKinnon,

Pacific

dian

bonds of

Railway,

W.

R.

&

Co., Lockheed Air¬

—

Abraham & Co., 120

Grace

Sept. 15, 1955 (Chicago, III.)

craft Corp. and Mueller Brass Co.
Lemer Stores Corporation

Municipal Bond Club of Chicago

Analysis

—

pre-outings breakfast at Welty's
Restaurant.

Broadway, New York 5, N. Y.
omic

9120
*

1

Review—New booklet—Harris, Upham & Co.,

Energy

Broadway, New York 5, N.

four colors with portfolio informa¬

Atomic Reactor Diagram in
tion

1955—Atomic Develop¬
Co., Inc., 1033 Thirtieth Street, N. W., Wash¬

Atomic Fund as of June 30,

cn

ment Securities

It—Revised
book presenting a formula for market gains—
copv—Dept. 1, McKay, 55 Fifth Avenue, New

Make

to

edition
$1.50

of

per

York 3,

Broadway,

New

Bond Club of Chi¬
annual field day at
Medina
Country Club

the
Wall

way,

dinner

—

Union

the

at

(Chicago, EL)

Sept. 16-17

Analysis
Co., 30 Pine Street, New York 5, N. Y.
—

15

League Club of Chicago).

Fuller & Co., 39 Broad¬

Philip Carey Manufacturing Company
Heller &

Sent.

and

cocktails

by

(preceded

Street, New York 5, N. Y.

New York 6, N. Y.

(Chicago, III.)

1955

16,

Municipal
cago 19th

Investment Bankers Association

Stanley

Fall

meeting of Board of Gov¬

ernors.

Secu¬
Y.
Japanese Synthetic Fiber Industry—Analysis in current issue
of "Weekly Stock Bulletin"—The Nikko Securities Co., Ltd.,
6, 1-chome, Kabuto-cho, Nihonbashi, Chuo-ku, Tokyo, Japan.
Japanese-U.
S. Taxation
Conventions — Analysis — Nomura
Securities Co., Ltd., 61 Broadway, New York 6, N. Y.
Also
in Japan—Circular—Yamaichi

Riverside
Office

Ill Broadway, New York 7, N.

Co.—New

Cement

Co.,

&

views—Lerner

South

10

Post

Salle

La

New York

Street,

(Philadelphia, Pa.)
Philadelphia 30th
Annual Field Day, at Hunting¬
don Valley Country Club, Ab-

Sept. 16, 1955

Square, Boston 9, Mass.

Bond Club of

Roseville, Mich.—Economic survey—John Nuveen

& Co., 135

Chicago 3, 111., and 40 Wall Street,

Also available is a bulletin on Cleveland
on West Virginia Turnpike.

5, N. Y.

ington, Pa.

<

Transit Revenue Bonds and

(Philadelphia, Pa.)

Sept. 19, 1955
Union

"Nomura's Investors Beacon" are discus¬

issue

same

Sept.

Co.—Report—General Investing Corp., 80

Old Hickory Copper

N. Y.

rities Co., Ltd.,

the

York 5, N. Y. Also
analysis of Marchant Calculators, Inc.

Killing in Wall Street and Keep

a

Investment Opportunities

in

120

Orradio Industries, Inc.—Report—S. D.

ington 7, D. C.
How

Upham & Co.,
available is an

Lindsay Chemical Company—Analysis—Harris,

Y.

Field

Investment

In

Also available is a survey
General Dynamics Corp., Cana¬

Street, New York 5, N. Y.

of the convertible

Recommendations & Literature
It

EVENTS

International Shoe
11 Wall

COMING

Y.

115

Bag

Paper

&

—

Bulletin

—

J.

R.

&

Williston

Co.,

Club

Women's

Investment

Broadway, New York 6, N. Y.

of

analysis of Business Results and

Philadelphia dinner meeting at
the Barclay.

analyses of Mitsui Chemical Industry Co.,
Chemical Co., Ltd., Tokyo Gas Co., Ltd.,
and Tokyo Electric Power Co., Ltd.

Sept. 20, 1955 (San Antonio, Tex.)
Investment Women of San An¬

New York State vs.
in New York State—

lation of officers in the Tapestry

of

sions

Outlook,

Ltd.,

and

Rates,

Bank

and

Sumitomo

Municipal

Bonds

Municipal

Tax

Totally

Partially

Bonds

Free

in

Tax Free

Pamohlet—Tucker, Anthony & Co., 120 Broadway, New York
5, N. Y.
parison between the listed industrial stocks used in the DowJones Averages and the 35 over-the-counter industrial stocks
used in the National Quotation Bureau Averages, both as to
yield

market performance over a 13-year period —
Quotation Bureau, Inc., 46 Front Street, New
N. Y.

and

National
York

4,

New

I.

du

Pont

&

Co.,

Street,

Wall

1

Room, St. Anthony Hotel.

INVESTMENT TRADERS

ASSOCIATION OF PHILADELPHIA

meeting and election of officers and Governors of
the Investment Traders Association of Philadelphia will be held /
The annual

Thursday,

Sept.

29,

1955

in

the Ballroom of the

annual field

by

Hotel.

a

Sept. 23, 1955 (New York City)
Charles

fortnightly bulletin—$11.25—Babson's Canadian Reports
Limited, Dept. CFC, 601 Harbour Commission Building, To¬

phy
■

1, Ont., Canada.

/

Hayden Memorial Tro¬

Highway

Authority

Bonds—Discussion—Park

Golf

''

N.J.

Hospital

&

Association

Traders

annual meeting

of Philadelphia,

election

and

Corporation—Analysis—Loewi

Supply

'

(Philadelphia, Pa.)

1955

Investment

Ryan,

Inc., 70 Pine Street, New York 5, N. Y.
American

Tournament at BalClub, Springfield,

Golf

tusrol

Sept. 29,
Alabama

day at the Omaha

Club—to be preceded
cocktail party Sept. 21.

Country

Warwick

to

ronto

•

Sept. 22, 1955 (Omaha, Neb.)
Nebraska
Investment Bankers

Canadian Mines—Three months' trial subscription

on

of Board of Gov¬

ernors.

York'5, N. Y.

Reports

instal¬

Sept 21-23, 1955 (Denver, Colo.)
Association of Stock Exchange
Firms meeting

on

Rails—Bulletin—Francis

Notes

NSTA

up-to-date com¬

Index—Folder showing an

Over-the-Counter

tonio dinner meeting and

at-the

officers

of

Hotel.

Warwick

Co., 225 East Mason Street, Milwaukee 2, Wis.
American

cussion
a

Company Limited—Review—H. Hentz & Co.,

Street, New York 4, N. Y.

of

Atomic

memorandum

Bonanza Oil

&

on

Power

the

and

Also available is
American

a

economy

Oil

the

ernors.

Penick & Ford, Ltd.
Nov.

Mine—Report—L. D. Friedman & Co., Inc., 52

Company, Ltd.
bulletin

same

Petroluem Company,

Discussion

—

Samuel M.

Wallace H.Runyan

"Highlights"

in

James G. Mundy

Kennedy

—

are

also

discussions

of

Cola

Nov. 27-Dec. 2,

Unilever, N. V. and British Motor Cor¬

Investment Bankers Association

Company—Analysis—Laird, Bissell

Palmolive

—

& Meeds, 120
Also available is an analysis

Memorandum

—

Hirsch

&

Co.,

25

Commonwealth

Life Insurance Co.

—

Memorandum

—

Broad

R. B. M. Smith V.-P.

Kidder,

Of

Peabody & Co., 17 Wall Street, New York 5, N. Y.
Corn Products Refining Co.

New

Broadway,

memorandum
Delhi

Taylor

Inc.,

626

available

Oil

is

a

York

Memorandum

6,

N.

Y.

Talmage & Co.,
Also available is a
—

memorandum

on

Kerr McGee

Oil

Industries,

New York 5, N. Y.

& Co., 120 Broad¬

Also available is
public National Bank of Dallas.
way.

General Gas—Analysis—Ira Haupt &
York

a

The nominees for office for the year

1st

Vice-President—Samuel

1955-56

are:

Hemphill, No>es & Co.

M.

Kennedy, Yarnall, Biddle &

G.

Mundy, Stroud & Company,

Vice-

Incorporated.

Treasurer—John

C.

Carothers, H.

M. Byllesby

&

Company,

Incorporated.

tion, 376 Sutter Street, San Francisco 8, Calif.

Smith

Mr.

President—James

Secretary —Rubin Hardy, The First Boston Corporation.
Hughes Organiza¬

businesses.

Co.
2nd

6, N. Y.

Scott Motors Company—Bulletin—The

associated

sequently
of

cisco.

More

of the
G.

A.

Uflmtwa Securities
Member

N.A.S.D.

Delhi-Taylor Oil

2400

Members: N.

74

Y.

Security Dealers Association

Trinity Place, New York 6, N. Y.




the

Fran¬

Francisco office
Company, in¬

bankers.

Field

JUNCTION,

GRAND

P.

Inc.

Colo.—

Augustin has joined
Renyx, Field & Com¬

the staff of

Mr. Augustin was for¬

merly with Ferrell &

Joins

Japanese Stocks and Bonds

2

with
San

Ferrell.

on

Troster, Singer & Co.
HA

Navy

(Special to Thf. Financial Chronicle)

pany,

Material and Consultation

Inquiries Invited

San

Becker &

Johannes
Broker and Dealer

Lieu¬

a

the

recently he was Man¬

With Renyx

©o., Xtfl.

Colorado Oil & Gas

in

America

Bank

ager

.

as

in

during World War II and was sub¬

vestment

DEPENDABLE MARKETS

served

Commander

tenant

of

Pioneer Natural Gas

with

Inc.

Plough.

responsibility in finance
particularly with respect to
the
company's plans to expand
through the acquisition of other

primary
and

review of Re¬

Co., Ill Broadway, New

of

President

John Carothers

Hardy

President—Wallace H. Runyan,

Delta Air Lines, Inc.—Review—Sutro Bros.

Hall

Rubin

Corp.—Memorandum—Wagenseller & Durst,
Spring Street, Los Angeles 14, Calif. Also

Inc.

Plough, Inc.

MEMPHIS, Tenn.—R. B. Macon
Smith has been elected a Vice-

Columbian Carbon Co.

on

South

—

Holly¬

at

Convention

annual

wood Beach Hotel.

Street, New York 4, N. Y.

Ill

(Hollywood,

1955

Florida)

Broadway, New York 5, N. Y.
of Chicago Corporation.
Colgate

City)

York

(New

1955

modore.

Dutch

Royal

19,

Security Traders Association of
New York cocktail party and
dinner dance at the Hotel Com¬

poration Ltd,
Coca

Exchange

meeting of Board of Gov¬

Firms

Troster, Singer & Co., 74 Trinity Place, New York 6, N. Y.
In

Stock

of

Association

dis¬
and

Broadway, New York 4, N. Y.
Burmah

(New York, N. Y.)

Nov. 16-18

Metal

60 Beaver

61

NY I376

DEMPSEY-TEGELER & CO.

Broadway, New York 6, N. Y.
Tel.:

BOwIing
Head

Green 9-0186

Office

Tokyo

Skyline Sees.

(Special to The Financial

without obligation

liam
line

Chronicle)

Clara B. Gil¬
has joined the staff of Sky¬
Securities, Inc., 1719 Walton

DENVER, Colo.

Street.

—

Volume 182

Number 5464... The Commercial and Financial Chronicle

(1073)
five years is

Dispelling Doubts About Sterling
By W. T. C. KING

the

In addition,

has

announced

its intention of also curtailing the
demands of public bodies directly
•—and

Editor of "The Banker," London, England

4^%)4

Government

not

only those of the local

authorities but also of the nation¬

Mr. King asserts future of Britain's exchange policy and the

alized

a

as

hard

on

/

LONDON,

Eng.

have come to a head in Britain,
deserving
careful
scrutiny
not
only by those to whom the future
of

sterling

and

of

economy
is important in

trends

Britain

in

as

still

in

"

sues

C.

King,

j^sq.

future

of

Britain's

exchange policy and the closelyinterrelated problem of checking
Although Britain
immediate

had

came

strikes

transport

less

through

with

much

dislocation

the

trade

returns

for June, im¬
been cleared at the

ports having

of exports,

expense

deficit

that

so

shown.

was

large

a

Some of these

held-up exports should fortify the
visible balance in later months,
but there is no means yet of guess¬
ing how much permanent damage
has

been

these

and

dropped
last

rent

account

of

out

before

the

that the external
as

ing invisibles)
far

Burden

impression
was

whole

a

cur¬

(includ¬

probably not

was

balance, and certainly

much less so than had been feared

early in the year. But the first
half-year
is
normally
much
stronger than the second half; and
the

summer

months will this time

secondary

any

fact

is

mand

that

hard

is

ago,

no

in

The
were

and

of undue

costs

export

and

of delivery dates.

lengthening

doubts

building

£42

overseas

These plans for restraint in the
public sector have been generally
welcomed
even
though public
opinion has learnt from long ex¬

perience

that

it

is

generally

ex¬

about

despite

big banks
investments, as
gilt-edged slump of 1952,

the

"at

value

under

or

cost

below

and

demption price"—but above
rent

market value

as

re¬

cur¬

disclosed in

marginal notes on the
(The
differences
thus

accounts.
revealed

ranged from under 1%

to 33A%.)

the

first

half

showed

£ 136 million

of

the

1954, yet ad¬
rise of

record

£289 million ,(to £2,186 million)
in contrast with £130 million last

Liquid

assets

million

(compared

year.

£420
fall

of

declined

sults

on

forts

of this

vate

up overseas

towards

the end of June probably sprang
originally from such tendencies as

restraint-is

the discussion

ministerial
newal

council

of the

Union.

at

the

about

OEEC

the

re¬

European Payments

The possibility that sterl¬

ing, if and when it becomes fully
convertible, might be permitted a
wider range of fluctuation than
the present narrow scope was then

coupled

with rumors that
itself might
be

con¬

vertibility

ar¬

ranged in the early future.
The
miliar

effect
"leads

national

was

and

to

turn

lags"

payments

the

fa¬

in inter¬

strongly

against sterling, putting sharp ad¬
ditional strain on the
gold and
dollar

during July and
the forward discount on
sterling in terms of the U. S. dol¬
reserves

forcing

lar well

beyond the point at which
disparity be¬

it balanced the wide
tween money

New

rates in London and

York.




in

advance

effects, it
that

of

not

was

the
an

is,

to

firm
Vice

have

had

A

grad¬

uate

of

Har¬

vard

Business

had

any

only specific

new

increase in the min¬

from

exchange

departed

from

School,
the

been

"pre-requisites"
to

move

ex¬

the

of

fa¬
any

formal

convertibility—
most
notably including, in the
present context, the condition that
the domestic
economy should be
strong and not, as at present, un¬

sumer

"The British Government," said
Mr. Butler on
July 25, "regards

goods from 15% to 33V3%.
Otherwise,
the
Chancellor
has
content to

number
and

rely here upon a
appeals to consumers

of

to

businesses

expenditures

to

to

keep

their

the period in front of
hard

of

one

minimum.

a

work

us

and

being

as

consolida¬

operat¬

firm

Arthur P. Martini

in

estate

tax

and

plan¬

ning. Prior to
that time he had been with Massa¬
chusetts Bay Co. Inc. as Assistant
to the President for two years.

King Merritt Adds
(Special to The Financial Chronicle)

der pressure of excessive demand.

been

had

ing his own
consulting

usual

increasingly
reiterated

LOS
C.

ANGELES, Calif.—Charles
McGonegal, Donald D. Robert¬

son

and Colin MacKenzie have be¬

come

&

affiliated with King Merritt

Co., Inc., 1151 South Broadway.

tion to strengthen the home front

exert

sufficient

a

brake

before

we

ward

move

make any

Certainly it was front." And he later gave a cat¬
reaching
the
point
at egorical reaffirmation of determ¬
which a much more perceptible
ination to maintain the present
effect was likely to be exerted
sterling parity (of $2.80 to the £),
than hitherto, becapse of the dis¬
comforts

for

the

banks

of

longer selling investments
of

pressure

for

any

LOS

on

advances.

probably
weeks

some

past
in June by

—

growing
but was

the special

demands for finance caused by the

hold-up

of

goods

through

the

strikes.
The authorities have not. how¬
felt »ble to
in

the

nut

their w^ole

automatic

develop¬

when

and

sterling

becomes

ANGELES, Calif.—William

Quealy, Jr. has been added to

the

staff

of

Morgan

South Spring

the Los

&

Co.,

Angeles Stock Exchange.

2 With

This last statement, in particu¬

lar, has made
upon" the

to have

seems

the

a

rumors.

LOS ANGELES, Calif.—William

deep impression

exchange

market,

and

effectively dispelled

Within two days, the

Shearson, Hammill

(Special to The Financial Chronicle)

B. Rex and Joseph R. Kraus have
become

associated with

Hammill &

Shearson,

Co., 520 South Grand

sterling-dollar rate Has recovered

Avenue.

to

ously with First California Com¬

beyond $2.79 and forward dis¬

counts

had

sharply narrowed.

Mr.

Kraus

previ¬

was

pany.

This announcement is neither
tbhares.

an

offer to sell

The

nor a solicitation of an offer to buy any of these
offer is made only by the Prospectus.

Government Moves

ing

with

conjuncture

this

—

the uncertainties of the balance of

payments,

the

106,931 Shares

disquiet¬

influences

of

speculative

pressures

and

squeeze

cided

was

yet exerting

check—the

July embarked
ies of

new

The Yale and Towne

Manufacturing
Company

and

upon a

whole

a

more

in

was

real¬

istic price for coal, which the na¬
tionalized coal industry had been

selling at

loss

a

Par Value)

($25

ser¬

The first

establish

Capital Stock

de¬

any

Government

measures.

to

move

sterling

on

to domestic

Rights, evidenced by subscription warrants,

to subscribe for

these

shares have been issued by the Company to the holders of its
Capital
Stock, which rights will expire at 3:30 P.M., Eastern Daylight Saving
Time on September 26, 1955, as more fully set forth in the
Prospectus.

,

con¬

sumers, a loss that

around

lowed

18%

is

ably the also nationalized gas and
electricity industries and the steel

industry
sale

(now

a

in

of

re¬

will

a

Share

price

Slock Exchange, whichever

Increases

disinflationary

The several Underwriters may offer shares of
Capital Stock at prices
the Subscription Price set forth above
(less, in the case
of sales to dealers, the concession allowed to
dealers) and not more
than either the last sale or current
offering price on the New York
not less than

act

process

the public).

to

These
as

Subscription Price

being fol¬

by

consequential rises in
closely associated industries—not¬

force

is greater, plus

an

amount equal to the

applicable New York Slock Exchange commission.

upon

domestic

demand unless and un¬
til spending power catches
up; and
the Government
to resist that

its

other

terest

presumably hopes
secondary process by

measures.

Rates

of

in¬

Copies of the Prospectus
in

which

the

are

obtainable from the undersigned only in States

undersigned is legally authorized to act

securities and in which such

Prospectus

may

as a

dealer in

be legally distributed.

charged by the Government
for

agency

new

loans

to

local

authorities

(especially for finance
municipal housing) have been

of

raised
not

in

to

take

account

—

MORGAN STANLEY & CO.

though

quite full account—of the rise

gilt-edged market yields since

the

last

increase

(the charge

now

in

official

for loans of

rates

634

Street, members of

con¬

vertible.

This pres¬

been

as

C.

'

the

as

avoiding putting strong

has

both in present conditions and

Morgan & Co.

(Special to The Financial Chronicle)

exchange

demand.

upon

sure

Joins

further for¬

the

on

already

within 10 years) declined by £254
million to £2,099 million.

Confronted

six

Mr.

Martini

policy.

the

for

last

years

the

practice of not attempting specific
denials, and in a series of state¬
has

a

dent.

Very wisely, therefore, the Chan¬
cellor

the

as

Presi¬

-

of

array

stemmed

about

rumors

P.

has

expected

be

whole

could

measures

miliar

Upon the pri¬

an¬
that

joined

indeed,

clearly visible

this

even

ef¬

kind.

down-payment
on
hirepurchase of many durable con¬

trust

aging

after

But

plicit.

imum

a

that had started

Continent

restraint

Martini

£304

these.
Soon afterwards they were
sharply accentuated by the rumors
the

City,

nounces

months.

likely to be increasingly felt.

re¬

any

rising costs had
threatened to widen to major pro¬
portions. The price increase aver¬

on

posi¬

reduction"

Of Lawrence Snell
Lawrence W. Snell Co., Inc., 70
Pine Street, New York

Increasingly Felt

notable

now

outlays—from

actual

sector

by

with

A

Be

He

ever,

million), bringing
their ratio to gross deposits down
from 34.3 to 30.1%, while invest¬
ment
portfolios
(all
in
dated
stocks,
the
majority
maturing

a

sterling that

few

"a

Arthur
Will

quick

results—or

concealed

in

for

significant
next

stantial

pared with

fall of

the

became

means

the

a

and

over

looks

ments

half-year covered by
the end-June balance sheets, ag¬
gregate net deposits fell by £386
million (to £6,173 million) com¬

Over

A. P. Martini V.-P.

bluntly-worded

a

tremely difficult to achieve sub¬

icy will

in

tive

and

pressure

the fact that four of the
to

by

quickly salutary effect on sterl¬
ing—given the extent to which the

attributable

was

writing-down,

advances

on
the
reserves,
the
excessive
level of domestic demand, and its
doubt
whether
the
monetary

few months

a

was

imports

increases

investment

the
any

giving rise to fears of further de¬
for

ad¬

other

but it is certainly excessive,

mands

June, but
while

yet

measure

available to
whether
prove
degree of domestic tension is

greater than it

de¬

against

There

resources.

statistical

general

its

to

Generally Welcomed

was

less than £83
portfolios
million.*
This

no

process.
The Chan¬
underlined the import¬

it

exhortation to the banks in which
he refers to their
"duty" to reduce

dislocations
domestic

pressing

available

attention

The implication evidently is that
he is satisfied that the credit pol¬

arising from the strikes but by the
undoubted

by

by

to

be additionally burdened not only

by

were

movements

movement

partly

done.

Additional

strikes

advances

two

rose

vances

The.

of

volume

seasonally,

vances

than

been expected, the holdup at
ports left a deep mark upon

the

bank

than

affirmed

elected

domestic inflation.

the

the

say,

million

T.

W.

is¬

the

are

to

Bank deposits rose in

,

employment.
two

in

rising, and the disparity be¬

less

b rimf ull "

These

increase

last February.

being bridged by the reduction in
investment portfolios.

plying ortho¬
dox policies to
an economy of

has

central

—

but

tween

the task of ap¬

back

expenditure."

as

assets,

a

case-study

is

hold

domestic

tending notably downwards under
the pressure of the squeeze in¬
duced upon the supply of liquid

pres¬

ent

the

Chancellor

the

special

measured by the "net"
deposits of the clearing banks was

are

watching

after

soon

rate to 4M>%

money

many

who

time,

same

object will

or

Government,
while restricting its own expendi¬
ture "to the minimum," will
"pay

monetary trends still seemed to
be following the
pattern estab¬

That

itself, but also
the

the

Bank

ain's

by

At

lished

Brit¬

that

Downward Trend

issues

the

And

work and

Two

—

The

down

of

ance

programs,
where practi¬
cable, unless they are regarded as
of the "greatest national urgency."

consolidation, before making
move on the exchange front; coupled with determination
permanently to maintain present sterling parity.

any

slow

of this

ment

cellor has

capital

case-study in task of applying orthodox policies to a "brimfull"
employment economy. Emphasizes government's intention to
concentrate

industries.

to

be

checking of domestic inflation present two crucial issues

9

September 12, 1955.

over

*£1=$2.80.

!

10

The Commercial and

(1074)

iFmancial Chronicle

Thursday, September 15,1955

...

'

a

New Investment Course

Connecticut Brevities
Yale

The

turing

Company

additional

stock

held.

on

million

will

9

and

six

used

to

repay

instruments

temperature

and

of

each

for

be

mote

Sept.

one

Rights will expire
Of the net proceeds

Sept. 26.

SI

its

infra-red

of

share

record

purchase

to

shares

offering

is

of

stockholders

rights

Manufac¬

Towne

&

control

industrial

ings of Olympic
its

its entire

outstanding bank
remaining will be
added to available working capi¬
tal.
During the five years ended
June

shares

presently

the

and

30, 1955, expenditures for
plant
and
equipment
have
amounted
about

or

about

to

Wire

&

being

of

offered

Cable

shares

are

purchase

to

$9

for

be

added

"Offering

1955

to

the

of

previous fiscal
❖

working

show

equal

$242,000

to

for

the

Surety

Company and of Auto¬

subsidiaries
22 to vote

two

on

Life

Insur¬

Sept.

on

proposal to merge

a

subsidiaries.

Stockhold¬

of record Oct. 14 of Aetna Cas¬

ers

ualty would receive

dividend,
then

payable

the

at

on

15

and

on

Dec.

Aetna

of

for

stock

date

Automobile

stock

share

a

53%

Nov.

merger

31, holders of
receive

a

share

*

On

Aug.

would

Casualty

basis.

of

Connecticut

voted

of

Company

at

special
meeting to change the name of
the company
to Insurance City
Life Company and also to increase
the

authorized

50,000 shares of $10
stock.

There

par

to

common

presently

are

out¬

standing 15,805 shares of common
and no plans have been announced
issue

to

stock.

of the additional
change in name is ex¬

any

The

pected

to become effective about
middle
of
September after

the

Jirst being approved by the Con¬
necticut Superior Court.

offering

Sept.

due

debentures,

is

1970

1,

being made today (Sept. 15) by a
banking

investment

nationwide

Dillon, Read &
Inc., Kuhn, Loeb & Co., and
headed

group

by

The debentures

1953

.

to

Wilfred

A.

0.89

16-13

0.89

14-12

i

1.17

0.89

13-11

;

59,000.000

0.97

0.89

14-10

_.

be

The

will

course

The

Financial

and

to

editor

of

author

Prentice

1956

of

the

Active

investment
in

concerned

guidance

lent

pitfalls,

close

follows

as

*11

aries

engaged principally in

ialized

of

forms

vestment

spec¬

fi¬

installment

tax

nancing, including certain related
insurance and other activities, and
in

factoring.

sidiaries

Together,

form

one

sub¬
of the largest

The

3

izations in
Canada.

the

United

States

subsidiaries

1954

were

the

six

$3,957,923,000

months

amounted

Total

to

and

(omitting

4 other

30,

-

*

to

*As

reported

personal

offer

course

members

on

complete and accurate chart of the Gary Subsidi¬
reader is referred to page 11 of General Telephone's

more

proxy statement issued for its stockholders'
Sept. 29, called to vote on the merger.

in

favor

of

injunction
the

that

Meeting

connection.

Chairman F. S. Spring of Gary has declined to
suit, while President Power of General has ex¬
pressed confidence that the merger will be consummated.
comment

the

on

for

area, and since that time,
other companies have also

three

These companies are
Pitney-Bowes,
Inc.,
Contempo¬

rary

Classics,

cision

Inc.

and

Gar

months

ended

June

30,

to

pic

new

adopted by Olym¬
Development Company, for¬

merly
&

a

name

division of Olympic Radio

Television

velopment

Co.

was

Olympic
formed to

De¬
con¬

tinue development and production

on

year

1955

cbvicus

will

that

require

General's

net

the most

to be

cn'.y because of its

Charles

Antoky

systems

were

derived

wards &

Telephone

has joined

FRANCISCO, Cai.—Glenn
Amsbury, Max Baum, Austin
W.
Bond,
Lyle
A.
Hoppman,

nue,

as

tive.
A. G. Edwards & Sons

Charles M. Otter, Lowell V.
Raty
and Alan A.
Shepard have been
added to the staff of Mutual Fund

bers of

the

change

and

and

New

York

&

Sales

Total

<

Associates, 444 Montgomery St.

are mem¬

Stock

other

Ex¬

stock

Members New York Stock

CONNECTICUT

&

firm

CO.

common

assuming
have

will

been

—

The

Sellers, Doe & Com¬

Commerce

pany,

Exchange

of

Building,

changed to

has

Sellers, Doe

&

Bonham.

r

that

stockholders

New
Hartford

—

JAckson

7-2669

gan

Teletype NH 194

&

Co.

Logan Branch

office at
,

vard

has

7221

under

Calif.—J.

opened

East

the

a

branch

of

compared
seem

100%

$8,166,000

approve,

etc.

to

for further

details)

earnings in

1954

General's

actual

with

indicate

that

The

merged

General's
would

proxy

19%

100%

company

statement

indicates that pro
been $2.08 a

have

earnings

of

$1.84.

This

the

in the book values of the two companies and other factors.

April 30,

1955, the

As of

forma book value of General was $17.31
while that of Gary was $15.37 (the number of shares of Gary
having been increased 50% to make their share equity comparable

will

Lo¬

Sunset Boule-

management

Francis L. L. Niles.

81

exchange ratio is favorable to
General, but consideration should also be given to the differences

that

HOLLYWOOD,

merged

would

I

New York —REctor 2-9377

6

1,077,000

equity ratio of 32.56%.

an

be studied

with

New Haven

SECURITIES

% of Total

$1,533,000
6,633,000

94%

$16,879,000

share

share

name

Amount

terms the Gary common and participating
will receive IV2 shares of General for each share of Gary,

(which should

Sellers, Doe, Bonham

MONTGOMERY, Ala.
CHAS. W. SCRANTON

-Gary-

% of Total

Under the merger

leading
commodity exchanges.

Now




follows:

Operations.. $15,802,000

Manufacturing

Sons, 501 Lexington Ave¬
a
registered representa¬

SAN

~Vf~

'

as

-General-

forma

Primary Markets in

Gary System,
operations, but because it controls the

Amount

the New York office of A. G. Ed¬

H.

In fact Automatic Electric Co.

important segment of the

own

rapidly-growing Canadian telephone subsidiary. In 1954 the net
income (applicable to parent companies)
of subsidiaries in the
two

Sol

consum¬

streamlining and integrating.
substantial manufacturing interests which can

doubtless be combined profitably.
appears

(when

acquisition

new

considerable

With A. G. Edwards

Mutual Fund Assoc. Add

Barnes Engineering Company is

1955-56

dinner

is

amounted to $18,383,000.

(Special to The Financial Chronicle)

the

first

Turner, florist.

Pre¬

Parts, Inc.

the

its

Sept. 19, 1955,
at The Barclay.
The speaker of
the meeting will be William H.

$35,590,000 before a non-recurring
profit of $5,033,000, and for the
six

It

PHILADELPHIA, Pa.—The In¬
hold

prevent this stock from being
In his suit Mr. Adams stated (as

to

merger.

reported by Dow Jones) that he was ill at the time the trust was
set up, and has no present recollection of signing documents in

Phila. Inv. Women
Dinner

preliminary

a

back

leased space.

meeting of

for

individual lectures.

or

evening,

1954 ^amounted

v,

Dow Jones.

46-page

a

of

year

controlled)

Operating Companies

by

Monday

the

r

Recently A. F. Adams, 74-year-old Honorary Chairman and
former President of the Gary Company, challenged the
validity of
a voting trust that controls 91%
of Gary common stock and asked

these

of

•

Foreign Subsidiaries

'18 Domestic

aries, the

to

income

its

.

(51% controlled)

meeting

net

and

,

Continental Telephone, formerly Telephone Bond & Share

the

Consolidated

corporation

number of smaller companies):

a

(majority of stock held by Adams family)

& Tel. Company (78%
Foreign and Domestic Subsidiaries1

For

for

by

The

Company
Anglo-Canadian Telephone
British Columbia Telephone and others

voted

$2,664,088,000.
held

amounted

Gary controls the next largest independent

revenues

Voting Trustees (including Messrs. Adams and Spring)
Gary & Company
1
%

plan¬

estate

year

June

ended

receivables

subsidiaries

the

in

doubt¬

either through registration for the

by the financing and fac¬

toring

this year was

entire series

pur¬

chased

including

their special problems throughout
the series. Admittance is available

and

receivables

Total

indicated

Automatic Electric

the investor's
family
financial

instructors

guidance

installment sales financing organ¬

^Consolidated.

company;

problems;

problems,
ning.

the

date.)

1054 and June, 1955....

Associated Tel.

market

how to pick a mutual fund or in¬

interest

to

range

May,

,

ing;

subsidi¬

market

in

Theodore

atten¬

wholly-owned

(Price

30.

20-11

;

^General and Telephone Investments

forecasting and tim¬
how
to - select
securities;
growth companies of tomorrow;

numerous

June

dividends

^Clearance Corporation

all

Among the topics to be stressed

1,

stock

"Almera Corp.

tion.

are

ended

;

:

of about $42 million or about 28% of
Gary System is a survival of the 1920 era of hold¬
ing companies, and has presumably escaped SEC streamlining
because the Public Utility
Holding Company Act did not apply
to telephone companies.
The System setup appears to be roughly

the

receive

the

of

General's.

prac¬

to

i

13-11

due to the

system, with 1954

Histori¬

and

months

announced in August.

series, subtitled "Selecting
Managing Your Securities in

1956.
C.I.T. Financial Corporation has

after Sept.

0.71

000,000

32,000,000

..

0.89

anticipated acquisition of a controlling interest .'in
Theodore Gary & Company, consummation of which was finally

best

current

Current

tical

ending Aug. 31,
principal amount on

the

to

and

1.01

less

Hall, Inc.,

cally High Markets," offers

months

12

1.37

Some

formerly of the Securities - and
Exchange
Commission
and
the
Treasury Department; and Leo
Barnes, chief economist and finan¬

The

redemption at prices scaled
102%% if redeemed during

16-12
22-14

^Adjusted lor 50%

Chronicle,"

the

of

portion

major

0.89

0.71

♦Twelve

by A. Wilfred May of the "Com¬
mercial

handling
of
the funds will be made available money.
A realistic appraisal of
to
C.I.T.'s
automobile
financing investment objectives and oppor¬
subsidiaries.
tunities, as v/ell as the avoidance
The new debentures are subject of psychological foibles and preva¬
purposes.

0.95

eiven

be

and

ing funds to the corporation's sub¬
sidiaries for the purchase of re¬
ceivables and for other corporate

1.06

44,000.000

1945...

and

work¬

additional

furnish

53,000,000

subsidiaries

jloor

20-16

■

38

__

by the Nev/ School for Sopial Re¬
search.

;

25-20

1.17

Both systems have

feet of

1.07

1.45

will

about 460,GOO square

45-23

$1.13
V

1.84

85,000,000

_.

delphia

space

$2.16

102,000,000

__

spectively.

its

more

.

Approx. Range

0.98

in 25 buildings to The Old
Colony Company of Danbury. At
the time, Yale & Towne leased

sold

including

:

Paid

1946...

May

,

the sale will

from

Proceeds
used

to

company's

70 000.000

1952...

seller, "Your Investments."

ity-

low

1.77

mated)

Company

plant,

million square feet of floor

The

41.

a

dividend)

128,000.000

vestment Women's Club of Phila¬

a

around

^Earned

%

142,000.000

._

$1,351,821,000 and $1,686,003,000, at Dec.
31, 1954 and June 30, 1955, re¬

Stamford
than

i

$181,000,000

__

1954.

cial

priced at 98.575% and accrued
interest to yield 3.75% to matur¬

1955,
Earlier this year Yale & Towne

Manufacturing

Revenues

*1955

Dr. Leo Barnes

of $100,000,000
C.I.T. Financial Corporation 3%%
Public

a

capitalization

to

stock

50%

a

-^Common Stock RccordYears

1948_l_

from

stockholders

Insurance

adjustment for

recog¬

from

stock

1947

*

29

Life

(after

opera¬

aggressive management.

common

growth record is reflected in the following figures:

Banking Group Offers

the

Credit

this year

23

an

the advance of the

45%, from which it has declined

C.I.T. Debentures

Company, both

Aetna

Company, will meet

ance

the

of

of

1951

Lehman Brothers.

*

Stockholders of Aetna Casualty
&

rapid-growth utility with

a

This is reflected in

company

are

mobile Insurance

as

manufacturing, sales and directory
two years the company has gained

During the past

nition

Stamford.

Co.

year.

*

tions.

1949.__

Circular"

income

beginning
announced

Problems,"

Oct. 6th at 5:30 p.m. is

of

approximately

was

net

ations and $32 million

1950

that the net income of $228,000 for
the
nine months ended
July 2,
the

nearly $181 million—of which $149 million reflect telephone oper¬

"Your In¬

10

capital and used to finance cur¬
plant expenditures.
Figures
the

course,

Theodore Gary & Co.

Telephone Corp. is the largest of the 5,000-odd inde¬
telephone companies, with recent annual revenues of

each

rent

in

weeks'

10

acquired
Clarksburg TV Cable Corporation
which
operates a community
television antenna system in West
Virginia in exchange for 170,000
shares of Olympic Development.
The
main
plant and offices of
Barnes Engineering is located in

Aug. 5, The rights will ex¬
pire on Sept. 21. Proceeds of the
will

A

vestment

—

General

October 6.

Sub¬

held.

share

reach

fo

sequently

record

issue

Olympic

Nev/

at

Telephone Cot p.

owned

thereof

part

or

Plastic

Corporation
at

of

(-

The

rights

share

new

million

excess

depreciation.

Stockholders

one

$12.7

$5.3 mi'lion in

available

Shortly
Development
offered to its stockholders rights
to purchase at $1 a share two new
thereafter

begin

Genera!
pendent

to

basis in January of 1955.

the

Joans

w"Il

Schoc!

one-for-ten

a

on

May,

hoid--

Development

stockholders

and

Olympic

processing.

Utility Securities
By OWEN ELY

Problems,". by Barnes

vestment

in

used

Public

Shortly

lG-we:k (Tscusnan of "Your In¬

chemical

also

controls

distributed

Gels Underwa y

re¬

measurement

and

mechanical

Radio

for

pro

General's).

Giving effect to the merger and other factors, it is estimated
pro forma earnings cf General for the calendar year 1955
be

substantially above the $2.16 reported for the 12 months
While General common at the recent price around

ended June 30.
41

yields only 3-1% (based on the present dividend rate of $1.28)
and is selling at some 19 times past earnings, due allowance must
be made for the

anticipated increase in earnings,

economies from

the integration

as

well

as

future

of the two systems and potential

benefits from other mergers which may

develop in future.

Volume 182

Number 5464

...

The Commercial and Financial Chronicle

(1075)
terials may offer the

Electronics Means

simplicity

a

storage

Revolution in Materials
Executive Vice-President, Engineering and Research
Radio Corporation of America

Calling

attention

the

to

the electronics
than

more

industry.

the

substitutes

mere

for

and
of

process

and

materials

for

''Horizons

electronics

and

in

this

a

ticular

all

Electronics."

do

we

indeed

In

have

a

But

us.

par¬

of

this

horizon that I
shall

to

linear

mate-

rials

the

—

mate¬

newer

which

influenced

Dr.

dominate the

E. W.

Engstrom

For it is here

that

already in the midst of
tion

which

is

we

are

revolu¬

a

shaking

foundation stones of

the

very

industry.
We
might well ask, "Doesn't
this
spell
obsolescence
to
the
our

methods and to the
have been

products
The

But.

is

of

newer

ones

ideas

basis

and

which

tronics

industry.
a

and

the

the
elec¬

the

of

Now

are

we

forward

move

to

even

equipment of the early
days made use of essentially the
materials

brother,

the

were

its

as

electrical

the

Today

older

bound;

electrons

the

are

magnetic materials.
how¬
class of materials en¬

and

From almost the beginning,
ever, a new

tered the radio scene.

neither
in
not

conductors

usual

the

the

to

ticles

the

of

These

and they did

and

coherer

its

with

crystal

insulators

nor

sense,

were

obey Ohm's law.
I
loosely packed par¬

always

refer

These

point

the

While the performance of

waves.

such units could be measured, the

basis of the performance was lit¬

understood.

tle

Except

for

such

specialty applications, these semi¬
conductors

were

the

discards

of

the electric and radio arts.

They
served well during the early radio
days but were all but forgotten
when the electron tube emerged.
electron

The

tube

tube.

control

precision

with

the

over

ever

three

types of electron action,to
perform the conducting, insulat¬

ing,

and

sential

magnetic

to

all

functions

electronic

es¬

circuits.

At the

same time, we have found
challenge and promise in the

both

achievement of hitherto

unfamil¬

iar effects.

Although

became

the

have

we

used

It

radio

we

while

generally

more

solids.

smaller

ity

is

Here

influenced

with

the

by

photo-

conductiv¬

light.

cathodoluminescence

With1 been
for

have

we

light under electron bom¬

bardment.
these

As

we

materials,

penetrated
nature

improved

of

research has

deeply into
potential use of

more

and

known

the

Materials
not

with

exist

been

in

created

search

spects,

we

we

consider

may

of

the

them

advances

anticipate

may

from

Electroluminescent
are

created

precise
stances

taining

by
blending

to
a

release

photons

evident

and in military apparatus.
The trend here,
spurred largely

ers,

transistor
the

more

development,

creation
devices.

of

economical

and

This

the

New

trend

Just

as

has

been

days

and

relied

we

in

use

their natural
The

1

solid-state

and

'

performance and their promise?
Our

us

mass

applied voltage has
the transitor, one of the
an

tors,

useful

we

products of -solid-state
the

ing germanium
with
trol

re¬

silicon,

current

closely

may

find
our

an-

in
.

•

wide

effects.

supplied to
the

ideal

magnetic

fields

also

in

for

application

Continued

on

systems.
to

Consequently,
recently

whose

i

«

have

we

resistivity

was

.

(Philadelphia Plan)

Yet

To

mature

iron

high con¬
somewhat

To be

annually $500,000

on

each September 15,1956

to

1970, inclusive

guaranteed unconditionally as to payment of the par value and dividends by endorsement
ditionally
d
rkC
~
by The New York Central Railroad Company.
'

MATURITIES AND YIELDS

to rely
metal alloys

came

upon

'

Equipment Trust Certificates

creating
electrical

our

ductivity, a property
incompatible with its effective use
in many magnetic applications.
until

•

3%%

by nature appeared

us

material

(electronic

and

happens

•

•

(Accrued interest

higher than

to

be added)

that of pure iron, but whose mag¬
netic
properties were undimin¬

1956

3.30%

1961

3.625%

1966

1957

3.40

1962

3.625

1967

3.70

ished'.

1958

3.50

1963

3.65

1968

3.70

1959

3.55

1964

3.65

1969

3.70

I960

3.60

1965

3.675

1970

3.70

Today, solid-state research
has enabled us to develop a whole
new family of ferromagnetic ma¬
terials.

These

ceramics, rather

are

—

3.70%

than

metals,
providing even
higher resistivity and better mag¬
netic properties than their metal¬
lic

predecessors.

From them,

we

have

we

are

At

the

covering

Tubes

progressed far,
still expanding

same

that

time,
the

we

are

Issuance and sale

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.

The

functions

per¬

formed by magnetic effect may be
achieved as well in certain new
rather

These

This

tric

materials

like

their

Our
by Dr. Engstrom at the
Luncheon at W«con, San
Calif., Aug. 26, 1955.

address

All-Industry




R. W. PRESSPRICH

&

BAXTER, WILLIAMS & CO.

CO.

L. F. ROTHSCHILD

GREGORY & SONS

& CO.

IRA HAUPT & CO.

materials

fields.

terials, the semiconductors.

HALSEY, STUART & CO. INC.

dis¬

at

an

behave

ferroelec¬

somewhat

ferromagnetic

research

appears

so-called

early

in

this

field

cousins.
is

still

stage.
However, it
that the ferroelectric ma¬

WM. E. POLLOCK

& CO., INC.

McMASTER HUTCHINSON&CO.

FIRST OF MICHIGAN CORPORATION
MULLANEY, WELLS & COMPANY

F.S. YANTIS&CO.
INCORPORATED

September 9.1955.

the

In these

television

'

.

to

transistors,

Photoconductive

energy.

today

con¬

related
our

influence conductivity by

materials

we may

by applying

and

the photoconductors.

radiant

transitor, employ¬
or

precision, influence and
one

communications.

materials used in

generally known and immediately

In

radio

Photo Conductors

are

search.

materials

Sharing in the development and
improvement of the semi-conduc¬

ability to influence conduc¬
by

antennas,

the ingredients of our

materials revolution. What of their

tivity
given

and

Equipment Trust of 1955

have be¬

we

familiar with magnetic
For many years, the iron

come more

of

dielectric

$7,500,000

understanding of
has grown through

aided

day's prototype of the pocket port¬
able radio,
incorporating these de¬
vices, heralds an era of personal

Transistor
i

new

Materials

research,

their
pres¬

tiny condensers that may be
used in transistorized circuits. To¬

state.

-

are

of

our

conductivity

power,

development

New York Central Railroad

Magnetic

devices

of

than

space

parallel

is

miniature

Such

the ferromagnetic materials which
furnish small and efficient cou¬

the

that

conductors.

ra¬

enough to
pocket, in ef¬

for

These

to

evi¬

small

pling transformers

those

In

as

light.
The
that is emitted

com¬

are

counterparts of the past and

our

which

of

of other

aids, in
telephone exchange
equipment, in electronic comput¬

materials,

free
electrons.
improvement of the old,

far

compact

by

to

of
produce a crystal, con¬
specified proportion of

their

carry in a breast
ficient miniature
hearing

are

conductors, insulators,
and magnetic materials available

extremely
certain sub¬

and

high-quality portable

receivers,

ent.

upon

today's

centers

dent in

days.

re¬

sam£ time,
transitors, with

Here the results

electronic

of

the

the

miniaturization

dio

the

by

requirements, has called
redesigning of circuits and

toward

achieve elec¬

influence

At

found

where

carried

discovery of the new
electronically-active solids, we
have
come
far from
the
early

materials

these

the

the

by

many

our

and

the

strike

may

been

tube.

ponents.

produces

atoms, which function as lumines¬
cent centers.
Upon application of
a
voltage
across
the
crystal,
electrons

under

With

laboratories

symbolic

we

for the

heat,
and
secondary
emitters
through which a single electron

property do
they have
entirely within re¬

some

us

properties. Among these
thermoelectric materials

the

trons

this

In

to

cooling and heating; ther¬
mionic emitters, which emit elec¬

nature:

solid-state field.

available

tronic

through the
greater understanding brought
about
by earlier discoveries in
the

time.

with which

the

electrolumines¬

as

and

long

their

are

challenging phenom¬

newer, more
enon

have

our

known

a

However, our
increased understanding of solidstate phenomena is
permitting us,
today, to take greater advantage

worked with materials which emit

visible

in

turn, be
united to form an infinite
variety
of materials.
Many of these have

today with far
conductivity in semi¬

than

more

is

and

and usefulness of
attention again has
been directed to the discard ma¬

An

worked

has

have

devices

electronically-

as

It

versatility

Francisco,

time

in

the introduction of
their compactness

'the

atoms.

may,

many of the basic
tasks of the electron
tube, and yet
demand a small fraction of the

electron

This is because nature
has supplied us with 100
different

These

devices

They perform

burden

exercise.

light and electrical
In this area we have for

in

Initially, transitors

elec¬

and

functions

tiny, rugged, and simple.

application

to which they have been or
be put would be a bewilcling

uses

may

concerned

are

electron tubes,

*

'

promising development

a

today's

solids

signifi¬

power required for tube operation.

mentioned.

of

are

our

by applying
voltages
than setting up magnetic

the

of

that

and

achieving control
range of important

is the keystone

Electron

While

prospect

electronic

novel

growing family of new materials,
it is appropriate to refer to them

dustry has depended.

-and

this

ma¬

of

wide

the

illustrate

to

elec¬ are today fashioning permanent
of all and non-permanent magnets of
efficiency
and
lighter
apparatus and techniques upon higher
*
which
the ever - expanding
v
in¬ weight.
of

lever-arm

tronics.

tasks.

new

quantity of light

semiconductor

is

—

research in materials.

basic

contacts.

the detectors of radio

were

electron

have learned how to

this

greater

conductors—ma¬

influence; insulators—ma¬
where

we

exercise

industry.

ment of electrons when under the

terials

the

trons in solid materials.

terials permitting the ready move¬

proper

of

case

however, we are working
with the controlled action of elec¬

we

Radio

These

the

Here,

active

accomplishments.

same

in

very

threshold beyond which

shall

greater

energy

by electron
(bombardment-in¬

bombardment

supported

growth

again at

obsoles¬

better

been

have

the

research.

and

by

have

phenomenal

We

obsoles¬

of

scientific

turnover

cence

roots

kind
the

is

of

Continued

our

is obviously, "Yes."

the

which

cence

which

services?"

our

answer

this

purpose

means

building blocks for

and

non¬

duced conductivity), and by ap¬
plied voltage (transistors), just as

electronics
scene.

radiant

It

energy.

(photoconductivity),

will

soon

by

lace.

terchanging

As understanding grew, we
learned that conductivity could be

and which

use

tube

relates to materials capable of in¬

well.

are
just now
coming into

of

a
television picture tube,
by the phosphor layer at the

and

the

unilateral

and

by

rear

and

in

used

electronic
functions.
functions performed to¬
the electron gun at the

listing
techniques to perform entire-v tronically-active

Here

these

their

from

came

of

uses

a

a

means

the

inevitable result

some

broad

materials

properties, cence.
which were those of importance
Electroluminescent materials,
for radio-frequency
detectors of placed
directly between two elec¬
the early days.
Then we moved trodes, emit visible
light under the
into small power applications as
influence of an electric current.

hori¬

of

rials

materials

This is

the

zon

ly

approach has not bedn
through- empirical experimenta¬
tion, but by painstaking research
with understanding of each step.
Also, it has not been a single ap¬
proach, but one which has taken
many routes with many evidences
of current and potential results.
first

cant
over

are

the

electrode.

and'

distinct

are fixed not so combining
sophisticated phenom¬
improvement of ex¬ ena within single materials that
isting systems — although this is- provides both tne
challenge and

and

the

The

of two

but rather-* the promise I have
upon the creation of new systems
A full

of technology.

time

direct

remarks

my

on

crystal

These

day

otner, weaker current to
terial through a third

The result is

single,

small

Our sights

an

efficient

more

techniques used in the past;

areas

seg¬

today.

f

persistent research, electronic science

conference

never-ending vista before

ment

past.

changing the

important

have

we

conductors.

theme

it is to

of discovering

the

lor

by

This process is
nothing less than
the combination within
a

and Techniques

much

Describes the transistor, photo-conductor

is penetrating

is

electronics,

electroluminescence, and concludes, with increasing flow

new

The

in

of materials in

use

systems and techniques to perform

new

tasks.

new

the

Says revolution in materials is far

materials

it is the creation of

entirely

never-ending vista

out changes in

stitutes

techniques

varied

voltage.

Created

-

be

may

electronic
functions.

The revolution in materials is
far more, however, than
a„process
of discovering more efficient sub¬

By DR. ELMER VV. ENGSTROM*

Dr. Engstrom points

advantage of

many

switching

Systeins

New

v

in

and

11

camera

page

27

I-

12

The Commercial and Financial Chronicle

(1076)

become

let

Business and Government:

first

They Natural Enemies?
By JOHN S.

business,

natural enemies,
but
counterparts of the organization of society, Mr. Cole¬
urges businessmen to become active in the affairs of the
community and of the nation. Stresses the importance of man¬
agement in both business and social organization, and points
out private interests can best be served in our democracy by
reconciling them with the community and national welfare.
Holding business and government are not

remarks, "Busi¬

The title of my

Enemies?"

Natural

raise

intended

to

tion

They

Are

Government:

and

ness

really

not

is

serious ques¬

any¬

in

Indeed, to

do

are

his

writing

re¬

I

will

What

right now

say

concern

that

they

those

are

of

who

John S. Coleman

attitude

of business and
of

one

us

whatever
not

government to be
with daggers

gladiators
are

our

prejudice,

the

ignore

gloomy.

so

we

never

can¬

other.

wholly on one side or an¬
And indeed, much of the

community

business and by the

of course, recognize
need
for government; it is
an artificial contrivance forced
of

us,

At the

whole.

a

same

time,

as

some

this legislation reflected an at¬

of

titude which went beyond what
people. It is a natural organi¬ was necessary to correct abuses. It
zation, called for by the very na¬ was a deep-seated hostility which
ture of man." Just as it is natural disturbed confidence and inhibited
for a man to take unto himself the enterprise and growth of the
I do not intend here,
a
wife and start a family, so it economy.
is a need of his nature to form however, to go into past history
and indulge in the rather futile
a
government. As we all know,
task of apportioning historic blame
in any but the smallest society,

not
on

alternative to established
government is anarchy—or, at the
best,
the
tenuous
and dubious
order imposed by vigilantes. Cer¬
tain things the individual cannot
do for himself. Paved and lighted
the only

streets, schools, libraries, parksall these facilities are beyond his

The important thing
is the present and what we should

and

praise.

do here and

now.

Climate

fact

The

greatly
10

is

that

business

which

years

climate

in

operates has

improved. We have had
of unparalleled prosper¬

establish. The
ity. Many of our friends and col¬
protection of his rights to life,
leagues ace in Washington bearing
liberty and property—if it de¬
heavy responsibilities in govern¬
pended on his strength alone—

unaided

power

before

fall

would

of his time.

around

time;
to

He would have to go

with his

today

carry

stronger man

a

unreasonable amount

occupy an

or

to

an

guard

up

all the

he might even have
atomic bomb in his

hip pocket.

ment. There is no longer a

divorce

those
manage
our
industrial and
commercial enterprises. Generally
between

government

and

who

it

is true

what
of

to

say

anxious

that after

some¬

the bonds
confidence between all parts of

the American

However, what a man cannot do

decades,

community

be¬

are

ing renewed. This calmer atmos¬
he can do if he co¬
phere is, I suggest, a good time to
operates with other men. Together consider how we
may consolidate
they form a government to which these
gains.
they assign certain authority and
It is some times said that we
certain duties. They give it a de¬
now live in a period where there
termined form and the means of
are no issues.
And though politi¬
continuing
itself
in
permanent
cal debate always has a certain
existence.
They even
establish
degree of heat, I think most of?, us
laws which they hold themselves
will agree that we have in ihe
bound to observe. In return, they
last two years enjoyed a period of
expect the government to do those
rather
unusual
moderation.
In
things which they are unable to
do as individuals
things like short, the American people have
a breathing space.
We are a pros¬
keeping order and providing a
perous, and for the most part, a
moral, physical and economic at¬
contented people. After an era of
mosphere in which man can grow
change, we are living in a period
and prosper. Given his nature as
of conservatism.
It is very easy
an intelligent and social being, it
at such times to sit back and en¬
is the most reasonable course in
the world that man should form a joy our rest. To do so now, how¬
ever, would certainly be rash. For
government.
one thing is certain.
The passage
Of course, its very essence and
of time
will
inevitably sharpen
purpose as a natural organization
again
the
issues
in American
places some limits on government.
politics.
Every
power
that
government
I am no prophet and I would
possesses is ceded to it by its citi¬
not hazard a
guess as
to when
zens.
Since its whole reason for

for

himself,

.

.

speak, of the individual citizen,

that

time

will

sure

that

we

come.

will

be

*An

ers

address

Annual

Mr.

by

Meeting

Association

of

of

Coleman
the

before

Manufactur¬

Connecticut, Hartlord,

Conn., Sept. 8, 1955.




be

of

the

in

given

pri¬

a

man¬

industrial

our

and

If

do

af¬

the

feel

in¬

same

citizens,

we

sit

the

larger

politics.

are

the

tariffs,

is

There

not

companies.

our

to

large

a

realize

coming

are

we

the

large

to

corpora¬

tion

is, in fact, a political entity,
power-wielding organism rais¬

a

the

ing

political

immemorial

is¬
justice.
then, that

sues

of freedom, order and

Let

no

tell

one

businessmen

you,

stick

must

their

to

politics.
We
are
already in politics, as
deeply and probably more deeply
than
any
single group
in this
desks

and

of

out

keep

country.
Management in American Society

management

described

has

writer

recent

the most

as

impor¬

the

If business

influence

deserves,
way

wnich

signs

the

of

ership and

groups,

times,

implacable

dressed

Are

to

what

sense

of

terms

political

facts.

ignore

this

speeches

our

chiefly

of

much

in

literature

necessity?

de¬

and give lead¬

direction

our

in

must,

we

other

as

of the community,

Does

ad¬

Is

ourselves?
have

we

to

think

this

it is important,
do

therefore, that

we

fail to draw the right con¬

not

clusions from

society,

In

it.

democratic

a

will inevitably

the voter

place those who exercise such an
important function under severe
ment makes
as

decisions

The

scrutiny.

and

de¬

example,

For

the

on

crucial to society

are

whole.

a

cisions

manage¬

of plant

purchase

equipment are determining
of employment.
Wage

level

the

of

distribution

close

to

cisions

changing

are

munities all

income.

build

or

the

De¬

a

of

faces

plant
com¬

the country. Our

over

contributions

affecting

policies

affect¬

are

ing the future of education. Our
advertising practices are unques¬
tionably influencing cultural
The flow of

standards.

from

ucts

centers

have, and will continue to change
habits of Ameri¬

the customs and

we

will disagree—but let us

preserve

above all, the American
debate.
The important

some

spirit

of

thing is that all sides be heard and
that

bated

not

t'^e

toward

tions

all-important

inde¬

These

ques¬

voter?
which

to

in

it

see

the

as

We
role

strategic

economic system.

our

In these

it is not

circumstances

surprising that society should in¬
sist
a

so

this

that

real

sense

much

efficient
soures,

responsibility
public

a

depends
of

use

is

the full and

on

economic

our

in

Where

one.

re-

the most private manage¬

ment

takes

and

family-owned business

social

a

on

character

a

well be

terprise.

is affected

tion

may

significant national en¬
If, in fact, the corpora¬

a

with

a

public in¬

terest,

we
must then, accept a
public responsibility.
I am not
suggesting that we pay less at¬
tention
to
the
private interests

to which the corporation

origins
On

the

best

be

ready

for

community and

in

means

my

of

between

in

am

life.

can

democracy

them

with

the

national welfare.

judgment,

the

best

the
is

for

public
us

to

and

private

make

a

full

only

by

Congressmen,

the country.

over

To my

mind, management is the
important function in Ameri¬

most

society.

can

If,

however, what I

nation.

Society is all

of

the

piece.

a

The economic and industrial
proc¬
ess
is
not
something, separate.
We

not worker ants who must

are

tasks.

nomic
from
be

our

from

eyes

our

On the contrary.

daily

Our

eco¬

system is society regarded
point of view. It cannot

one

lifted

out

of

from

context

the

total

community. Bv the fact that
management occupies a strategic
position in the making of eco¬
nomic decisions, it makes
them,
too, in various degrees in other
spheres

cultural,

—

political

and

are

every

that

area

the

of

life.

our

question

of

The

fact

enmity be¬

have dif¬

tween

But

certainly,

winning of

somntimes raised, is evidence that
much remains to be done to find

we

may

answers.

consent.
No group in our

have

to

pect
heard

unless

society

its
it

can ex¬

point

view

of

it

states

continu¬

government and business is

that basis of cooperation between
them
that
is
necessary
for the
achievement

of our urgent social
In that task, society has
right
to
expect
leadership

purposes.

ally and persuasively—before the

the

public, before the Congress, in the

from

the business

administration, in the

is

legitimate

each

in

the

of

political
and

Note

say

its

that

is

"unless

important

often

that

I

decisions

persuasively."

case

most

within
parties and

press,

place where policies

every

determined

said,

the last

are

it

is

community. It
expectation.
We
it with vigor

respond

and good

to

will.

Now With Keizer

a

(Special to The Financial Chronicle)

It

unjustly,
always fighting

Whether

war.

should

states

This

qualification.

are

a

made.

probably

generals

not it is

BOSTON, Mass. -j- Florence S.
Mummey has become associated
with

Keizer

&

generals, I suspect the
charge may well be true of some

Co., Inc., IT Con¬
Miss Mummey was
formerly cashier for John G. Sess-

businessmen.

ler

true

At

have been

may

protesting
a

or

of

in

world

times

against

the

feel

we

Co.

&

come

back,

the

leading

and

of

passing

never

guiding

I

Street.

gress

interested in

more

world that will

than

Business

it is.

as

Businessmen
What

then,

us?

It

Public

and

does

means

and

councils

though

tend

I

Office

this

all
the

Man's

mean

acceptance

of

both

suspect

be

to

of

us

it

most

Republicans,

is

be heard in the Democratic party.
It means a positive and helpful

attitude

and

to

civil

servants

who,

men

with

meager

abuse, shoulder great
responsibilities. It means keeping
informed

on

the

issues

of the day so that we can in

lic and private

pub¬

discussion, give the

kind of leadership which will de¬
serve

to be followed.

Another condition
fulfilled

if

must also be

businessmen

condition

of

is

to

are

public policy.
the

support

That

and

en¬

couragement of their business col¬

it may seem
strange to you that I should men¬
tion this condition. Indeed, let me
add, I not only mention it, I place
great emphasis upon it. Inevitably
as we participate
more and more
in political debate we will be put¬
ting our necks out on controver¬
Perhaps

sial

issues.

will

be

in

Perhaps
the

many

of

us

position of saying

things to which

some

of

Vol.

Behavior

II

(Life

Cycle and Consumer Behavior)
—Lincoln

Clark, Editor—New
University Press,. Wash¬
ington
Square, New York 3,
N. Y. (board covers) $5.

York

Free

Films

Booklet
16

our

col¬

for

of

Men's

Clubs

—

selected

free

loan

films

with

basic

sound

mm

Association
Films, Inc., 347 Madison Avenue,
New York 17, N. Y.
appeal

How

to

to

men

Make

Street

make their full contribution to the

formation

Consumer

the

and

rewards

much

ourselves

Bookshelf

parties—

equally important, if not more so,
that enlightened business opinion

arguing leagues.

interests
our

its

attaining this harmony

to

interest

I

private

served

reconciling

And,

continuing

contrary,

these

that

its

and

owes

de¬

each is relevant to the

the

must

thoroughly

by editors, by news and radio
commentators, by labor leaders,
but by individual businessmen all

manufacture
of
public office.
It
means
the
and distribution of our products
willingness to serve on govern¬
is having an imnortant impact op
ment committees and commissions.
international
relationships.
We
It means the active participation
must, then, recognize the mana¬
in

gerial function for what it is.

be

social. And in the same way, the
frantic, with the tone
impact of legislation, the influence
of protest rather than persuasion?
of government, even if kept to a
Are
we
directing
our
efforts
minimum, will always be felt in

for

the

Abroad,

cans.

issue

an

bated before it is determined—de¬

prod¬

new

research

our

out.

agree; on

somewhat

fair statement;

a

was

right, he

speak

say

tant function in American society.
I

to

will

we

affairs of the community and

or

termine what is the general

those

some

not raise

it

the

ferent
A

we

arena.

democracy.

same

read

obligation

On

proportionately participate in the

attain

pendent

by

practice a realistic phi¬
losophy of business and politics.
What I mean by this, I hope will

the

the

democracy,

program

a

feel

has not only the

has

issues

Per¬
safer

But every busi¬

policies must win their

a

in

to

we

they are all
political ques¬

extent

that

is

If

us.

of silence.

have said is true, then the
present
incumbents of that function must

a

policy that
win popular consent is prac¬

tical

sub¬

in

must accept

we

in

in the political

can

Yet

Indeed,

tions.

these

of

one

does not closely affect

jects that

those

to

come

that

fact

Only

crimination, collective bargaining.

for

exception.
prefer the

nessmen

it out. At the
expect to

wait

to be realistic

way

dis¬

racial

and

ideas and

programs,

recession, inflation, monetary pol¬
taxation,

too, must

our cus¬

take

may

we

course

cannot

we

public office to

is

business

defense

time,

back

direct and
to do so.

a

of

setting

War,

of manage¬

much,

to carry

means

the other day,

said

someone

demanded

If they are charged with
function, they must be allowed

as

so

is

be given.
a

not

businessmen,
immediate obligation
As

much

not always aware.

are

ment, therefore,

however,

political

as

am

only if we have used this rela¬
tively peaceful period to develop
and

should

public

do

we

I

But

it

the

us

.

being is to augment the reach, so
to

in

and dividend oolicies are

Improved

the

now

if

to

have,

the
Business

remains,

ourselves

clined

in current

history.
the

Admittedly right and wrong are

Yet,

It is one legislation that business strongly
protested is now accepted both by

issue.

the most significant
All

continuously for a proper repre¬
sentation of our interests.

I doubt, however, whether

of

most

the pre-war years,
especially bad. And in past dec¬
ades
we
have
had to
struggle
tion became, in

sider the ordi¬

drawn.

the connec¬

business particularly,

they con¬

nary

but

the line of
communication to the citizen be¬
comes weaker and weaker.
With

to act as

seem

is

size,

increasing

with

on

sides

both

the fence,

public,

the

represents

said,

There

mies."

it

Government,

heard.

selves

ene¬

heard

be

weight. The successful

agement

have the opportunity to

There

And

icy,

for

cause

us

and to the point where
or
groups
find
it
harder and harder to make them¬

not

are

natural

given

has

is the growth of big gov¬

individuals

"No,

is,

or

ernment,

an¬

my

swer

letters

love

own

blowing his own nose."

sus¬

pense

which

things

certain

ago,

number of

small

very

ever

so.

terest

itself,

years

some

advice

mary

special obligation directly to in¬

a

should do for himself, like

man

a

all

move

of

remarked

in

its

t'o

which its proficiency lies.
that area it is likely that

in

And

concern

time, it is clear that

same

a

will

perform himself. As a well-known
author

right

a

area

the

only

functions which he can very well

"There

mind.

one's

if

a

has

Not

commercial organizations, depends
on
certain
conditions
of
which

fairs.

to

assume

impor¬

At the

man

not

with

only

every

haps

stockholders,

our

will

tomers

decision.

ready to enter the public service.

are

should

must

of leagues,

process

Certainly no one group has a
monopoly of wisaom.
Yet each

con¬

of American life.

they

the

to

political

must

not

with

but

tant aspect

contribution

But

suggesting

them¬
selves
with
politics.
I do not
mean necessarily actual service in
Washington.
Certainly it is im¬
portant that we should always be

COLEMAN*

it

proceed.
am

businessmen

themselves

least,

Burroughs Corporation

President,

I

as

here, I

say

that

cern

Are

clear

me

Thursday, September 15,1955

...

and

edition

of

formula

for

a

—

in

Killing

Keep

It!

—

Wall

Revised

book

presenting a
gains—Mc¬
Kay, Dept. 1, 55 Fifth Avenue,
New York 3, N. Y.—SI.50.

Modern

market

Merchandising

and

Mu¬

nicipal Finance—Mabel Walker
—

Tax

457

Institute

Incorporated,
Street, Princeton,

Nassau

N. J. (paper)

Reports

on

75«.

Canadian

Mines

—

Three months' trial subscription
to

fortnightly bulletin—$11.25—
Lim¬

Babson's Canadian Reports

ited,

Dept.

CFC,

601

Harbour

Commission Building, Toronto

Ont., Canada.

i

1,

Volume 182

Number 5464

...

The Commercial and Financial Chronicle

hands and different groups

New Frontiers in Banking

ple
play

By C. A. SIENKIEWICZ *

bankers,

on

of

warns

frontiers
cites

that

as

industrial

new

fibers and

insure

can

Holds

action

an

popu¬

The collections for old age

pensions last fiscal

invested in so-called special issues
last April reached $41.7 billion, or

lution

the

from

Similarly,

so-called class

or

at

from whole¬

to

shift

nally, to

study

Another

during

sug¬

as

C.

A.

Sienkiewicz

our

'

is

not

tell

my

each

point clear.
intention to try to

committee

expected to do
it

is

to

explore.

practical
to

within

All

the

it

of

you

and

is

are

resourceful

bankers.

select

what

what subjects

nor

knowledgeable,
is

Your

define

lines of

and

function

commit¬

your

responsibility, to study them
in the light of all available in¬
formation, and then to present

findings and suggestions for

the benefit of all

our

membership.

Many of the problems confront¬
are directly related to the
industrial and social frontiers

us

new

that

changing

aie

the

economic

scene.

Truly amazing things have hap¬
pened to our economy during the
last three decades.
new

We have

technological horizons

bringing

spectacular

a

products

new

and

emerge,

of

methods.

vast

a

seen

array

new

We have witnessed

evolu¬

tion of managerial skill and prod¬

uctivity.
chemical

Our

industry, for ex¬
to be a giant,
producing synthetic fibres, plas¬
tics, petro-chemicals and a myriad
ample, has

grown

of other products unknown a gen¬

eration

The

field

of

electronics has appeared, with

its

miracle-like

its

ago.

new

surprises

numberless

and

industrial

new

units

knocking at the banker's door.
The discovery and application of
atomic power in

the fields of in¬

dustry, agriculture, medicine, avi¬
ation
tion

and peaceful ocean naviga¬
promise great and imminent
who

launching
circling
may

can

ntl y

rece

tell

plan

up

in

for

banking

outer

We should take

frontier

space

opportunities

new

on

celestial

a

scale, free from terrestrial
petition a«d anxiety.
new

the

man-made, earth-en¬

satellite

for branch

that

but

announced
a

open

policies should be used
income.

and

Act

com¬

nd»te of another

that

is

agencies shall

to maintain

els.

related

to

it to mean,

that if

used

With

American

so¬

One of them is Social Secu¬
rity, which is a system of vast tax
collections to provide some cur¬

ciety.

rent

income

to

the

unemployed

local,
approaching
billion, it is obvious that
great power resides within gov¬

$100

ernments.

The

much of this

welfare

has

•Statement

vania

by

Bankers

Pa., Aug.

Mr.

Sienkiewicz

Committees

17,

of

Association,
1955.

the

to

the

Pennsyl¬

Harrisburg,




expenditure

for defense and

sum

its

definite

own

im¬

At the same
unbalanced Federal bud¬

an

get tends to increase

ply,

of

the economy.

on

time,

inflationary

an

deficit

is

money

sup¬

force if
through

financed

the
the

banking system.

com¬

The

progressive

graduated
profound.
tated

it

income

our

has

tax

greatly
their power

or

en¬

to

the

framework

strategic frontier in

savings

long-term
short-term

primarily for seasonal
quirements of business.
The

re¬

second
development has
rapid growth of investment
in securities—from $2.2 billion in
a

1914

to about $82

ent.

This

cial

banks have

means

functions
"rather

billion at

that the

pres¬

commer¬

assumed also

investment

of

than

adequate credit facilities. An anal¬
ysis of the specific changes in

carrying

the

trusts

their

out

original purposes of receiving de¬
posits and making short-term
'

The effect of these
been -gradual

pervasive.
in

to

the

but

Much

1930's

new

:p'

.s

of

could

standards

changes has
the

none

attributed

and

practices

arising from these changes.
What has happened to the
ing assets of banking?
Whereas in
about
of

60%

total

loans

41%

earn¬

1920 loans made up

and

assets,

were

less

trouble

our

be

37%

investments

18%

this

year

in

May

and

investments

of assets.

To express it an¬
way—whereas loans in 1920

78% and investments 23% of

total

deposits, today they

...

are

re¬

spectively 40 and 45% of deposits.
Deposits are the most important
liability of the bank. They are
ordinary debt, but they constitute
by far the largest part of our
money supply.
Banks can and do
create deposits: first, passibely by
accepting funds and, second, ac¬
tively by lending funds to cus¬
tomers and by buying securities.
And creation of deposits increases

supply, especially
through checking accounts.

-■

Let

first consider commercial

us

loans.

.

As

significance

of

these

know, the old idea

you

of commercial banking, patterned

the

British

maintain

system, was to
certain proportion of

a

funds in

and

cash

much

a

larger

proportion in shprt-term loans for
productive purposes. Back of this
idea

loans

such

As

the

was

term

that

short-

self-liquidating.

they protected deposits
they automatically pro¬

because

vided

belief

were

funds

to

with¬

the

meet

drawals.

ernmental

Our

action.

Federal

Reserve
System
designed to be the lender of

was

last

but

resort,

restricted

by

ing

credit.

funds

its

law,

powers

based

Instead of supplying
the tide, Federal

Banks

pressing

for
to

themselves

had

be

made

full

and

ing events.

As

eral Reserve
a

result,

a

has

income

in banks and

population
buy

to

money

lender of last resort.

It is

to invest.

to

put

It has re¬

any -sound
assets instead of
only against meticulously defined

commercial

paper.

.

.

lending

serve

was

powers

risk
It

putting their

money

was

discernible

of

passage

shortly after the
Federal Reserve

the

Act. For example, an earlier study
the

that

Federal

in

Reserve

the

1920

affected

tions have

mercial

first

dropped to 12% and in 1932 they

place,

corporations learned
funds through tne
in the market,
through depreciation allowances,
and through the substantial re¬

made

loans

total earning assets.

how

to

obtain

were

sale

of

securities

tention

of

operations
ence

on

earnings from
that

so

of

many

the

paid when due but
and

learned
loans

in

Finally,

wholly

not

re¬

renewed

of

was

trouble,
collect

to

or

bank shows
of the loans
liqui¬

partly

dated

during the season in which
made is less than oneof
earning- assets.
About
one-fifth
represent
direct con¬

they

are

third

chased.
a

and

credit

sumer

The

mixture

contracts

balance

of

traditional

method

of
selling
Institutional in¬

capital

have put

large fund^ into

vestors

these debt obligations. Tl^ey have
also bid up the price of stocks of

revolving loans and chattel mort¬

on

the

that securities could al¬
ways be sold at a price.
The dif¬
ficulty with this belief was pain¬
fully realized during the banking
theory

trouble in the 1930's when neither
loans

could

be

readily collected
securities sold, chiefly because

nor

there

were

no

of

securities

both.

In

buyers of goods or

but

only

sellers

of

They

gages.

loans

commercial

Truly

viously

are

and marketing of
of

capital

goods. But loans

and semi-capital char¬

acter, to be fluid and current, re¬
amortization.
A
definite
schedule of repayment is essential
quire

Continued

on

(S10 Par Value)

September 12, 1955

are

Smaller

and

in

business

new

the

meantime,

being issued transferable

expiring at 12 o'clock, noon, October 7, 1955, evidencing

right to subscribe for these shares on the basis of one new share for

each two shares held of record.

in

capital

raising
for growth and

ment.

Yet

these

are

if

more

proprietary

Here

then

is

a

engendered by
us

as

Subscription Price to Warrant Holders

necessary

$30 per share

improve¬

smaller

are our

them

en¬

have

units

customers;

well

able

run

to

and

The

unsubscribed shares.

obtain

risk

capital.

problem,

largely

or

tax system, for
lenders to consider.
our

The meaning

undersigned has agreed to purchase all

Johnston, Lemon & Co.

of these develop¬

ments is that the resources of the

terms

of

over

the

they

now

are

not

dollars,
past

flow

15

only larger in
with inflation
years,

but

also

through different

Washington, D. C.

ob¬

repaid out of the pro¬

Capital Stock

Stockholders of record

and

ceeds realized from the conversion

panicky

consequence,

time

require

earnings to liquidate.

prominently successful companies
to a point of extremely low yield.
terprises,

be

semi-

capital credit such as term loans,

securities

Washington, D.C.

the

and

of

in

The National Bank o/^shington

warrants,

pur¬

to

seems

time deposits was accompanied by

investment

growth

do not know

our own

proportion

are

Third, it

the

experience of
the

without aggravating business con¬
ditions.

we

that

supposedly

times

Unfortunately,

earning

what this proportion is today. The

tax-

wise, to finance expansion by
borrowing money instead of the

of

In 1929, they

total

of

that

were

difficult

8%

depend¬

were

again.

over

that

were

only

lessened.

was

self-liquidating loans
over

current

their

bank credit

Second,

corpora¬

it cheaper,

26%

up

assets.

of

Many

found

com¬

if not completely upset,
by several developments. In the

maimed,

in

processes

the

capital formation.

showed

so-called

ventures.
has

be¬

a

lated recognition of the trend that

duced upper

instead of

.

.

This broadening of Federal Re¬

f

205,000 Shares

incomes, driving peo¬
ple of wealth to tax-exempt mu¬
nicipals and "blue chip" securities

now

on

which

goods,

Fed¬

our

empowered to lend to its members

correspondingly increased the
middle

was

System today is truly

employment,

wiped out the
once-styled low income group and

it

and

been

well-nigh

were

repayment of their
loans to banks.
A change in the

Certainly it has facili¬

wages

on

stem

to

Reserve

Combined with rapidly ris¬

has

were

the
theory of self-liquidat¬

unrealistic

of

-

But the whole theory was badly

money

The

be independent of the gen¬
nor of gov¬

never

eral business situation

made under the stress of devastat¬

Commercial Loans

•

loans.

mean¬

that

was

banking system was not a
prime mover and that it could

law

bank assets will make this

after

-

been

which depends on an ef¬
ficient banking mechanism and on

institutions

supplied
rather .than*

The lesson of the 1930's

the

of

complex

our

of

broad redistribution of in¬

a

come.

ing

of

effect

expansion

been

some

funds

the.

In the Shadow of the Income Tax

economy
.

Assembled

that

meant

have

capital

and

prosper

our

be

budgets,

governmental

Federal

of

which have be¬

which

of

other

shall

this objective.

could

of

necessary, even

measures

to attain

many

political-

it has

were

inflationary

predominantly

economic concepts

use every means

It implies, and some construe

values. It consists of

new

Re¬

ing clear.

employment, produc¬

banking and credit because it in¬
the
integrity
of
dollar

part

Em¬

provides

tion and income at maximum lev¬

difficulties

volves

come

The

1946

of

equity securities.

changes.
And

its

pact

Significance of New Frontiers

ing

business

problems

tee

your

that fiscal

is

that the Federal Government and

I want to make this

It

through

most of it

public instruments to stabilize

ployment

committees.

Federal

have

we

markets..

period

of

economy

concept developed

new

this

and credit

for

by

flows

investment

enters

areas and

problems

funds

of

banking channels and

assets; and, fi¬

a

with an
accumulation of
billion. This enormous

volume

in

billion

$23

some

the pattern of
bank
earning

gest

the rate of almost $3

year, 1

retail

banking, and
the

huge system of pri¬

a

The growth of this new source is

banking,

sale

-

vate pensions has been established.

banking to
mass

amounted

$9.5 billion and the total fund

about 15% of the Federal debt.

evo¬

role

destruction

and

13

values followed.

create credit and thus alter
money

growth,

second,
point out
effects of

the

of

System,

functions

year

has

through

experir
enced a great expansion in time
deposits—from $1.5 billion in 1915
to almost $48 billion at present.
Whatever the reasons back of this

new

aging

40

some

mercial banks have assumed

lation.

to

occurred

In the first place, since

creation

serve

current changes in our economic
frontiers upon banking and credit;

to

realize that

the

banks.in.credit

contraction

hanced

us

second,

the Federal Reserve System. Com¬
mercial banks, therefore, hold a

banking

the

the private debt.
and protection to our

and,

supply within

years ago.

and

power,

larged functions of all commercial

cial

plastics, and petro-chemicals. Warns of growth in

The purpose of my remarks will
be: first, to indicate the impact of

the

liquidation

have

assets

the first great change in commer¬

economic

inflation,

of atomic

use

in

the character of earning
resulted in the en¬

shifts in

banks,

Probably few of

inflationary

many

without

prosperity

frontiers,

have

we

role

changes is twofold: first, the broad

the

speculation, and calls for prudent

private and public policies.

now

Changing Banking and Credit

developments and their adverse effects in the banking field.
Says possession of large liquid assets by individuals may
lead to over-confidence and

agovernments

Structure

Prominent Philadelphia banker, in commenting

Pennsylvania

peo¬

The

much greater

a

of

spending.

economy.

President, Central-Penn National Bank, Philadelphia, Pa.

for

their

control

consumer

President. Pennsylvania Bankers Association

program

(1077)

September 13, 1955

page

26

24

The Commercial and Financial Chronicle

(1078)

credit

By R. L.

p;

& Co.,

E. Button

W.

WEISSMAN

closely in line with
quirements. v Bankers

j
|

[

Introduction
The way of

like
is

the

of the transgressor,
few exceptions,

way

With

hard.

has
always
been
con¬
demned by the Monday morning
quarterbacks for being tardy or
too

premature,

severe

not

or

vigorous

enough.
For long pe¬
riods, the Federal Reserve System

Board and

serve

banks.

When,

the

Federal

Re¬

however,

the

Federal
Reserve authorities "lean against
the
breeze,"
in
the
words
of
Chairman
Martin, central bank
policy becomes of widespread in¬
terest.

the

beginning

for

carrying out Federal Reserve pol¬
icy are (1) open-market opera¬
tions, (2) discount policy, and (3)

changes in member bank
requirements.
(1)

Open-market

consist

of

of United

curities

reserve

operations

the

Federal

Reserve

banks,
mainly
United
States
Treasury bills. Purchases ^upply
reserves to member
banks, where¬
as sales absorb or
extinguish re¬
These

serves.

used

operations

can

be

too

ofset losses or gains in
resulting from changes in
such factors as currency in circu¬
lation or gold stock, or to expand
reserves

reduce the volume of bank

or

Open

serves.

-

market

re¬

operations

carried out at the initiative of
the Federal Reserve System.
are

policy

Discount

policy

borrowing from
obtain
rates

relates

Federal

The

reserves.

at

which

banks

serve

by

the

to
Re¬

banks by member banks to

serve

the

the

lend

Federal

from

time

view

and

to

discount

Federal

are

Re¬

established

Reserve

banks

time, subject to re¬
by the

determination

Board of Governors.

On the other

band, the initiative in using the
discount window is taken
by in¬
dividual member banks.

(3)

The initiative with regard
changes in, member bank re¬
serve requirements
may be taken
only
by
the
Federal
Reserve
banks, which by raising or lower¬
ing reserve requirements dimin¬
to

ish

enlarge the volume of funds

or

which
able

member banks have avail¬

for lending.

serve

Changes in

requirements
time

same

within

each

all

affect

at

re¬

the

member

banks

class

subject

reserve

to the action.

"Moral

refers

to

ap¬

peals

or
warnings made by the
banking and monetary authorities

to all

or

with

the

their

policies.

of

influencing
Recently,
there

were

meetings with representa¬
tives of major finance
companies
the American Bankers Asso¬
ciation. While the Federal Reserve
Board could not
reimpose direct
controls, the fact that it was re¬
garded as advisable to hold meet¬

and

ings showed that the Board

was

uneasy about the situation.
Direct

or

qualitative

controls

limited to the
establishment
margin requirements on secu¬
rity loans. Other controls

are

of

to

Veterans

Federal

relating
Administration and

Housing Authority mort¬




not

Determining

to

be

restriction

banking is
Because

central

bankers

ment

Govern¬

States

securities, reductions in the

discount

rate

ments of

reserve

re¬

Thus, all the instru¬

policy

change

invoked.

were

from

later

and

ease

in

and

"active"

to

to

ease

was

altered to mild restraint earl¬

ier

this

reductions

by

year

in

Federal Reserve security holdings
and a lifting of the discount rate

spring, moving on to a pol¬
icy of just plain restraint as evi¬
denced by a second rise in the

discount

rate

the

soften

and

effect

of

the

of

the
was

eral

Reserve

"Influence

tary

Board

of

of

study of

a

Credit

Measures

re¬

by the Fed¬
in

and

Mone¬

Economic

on

Sta¬

bility."
A

its

books, to be

the

funds

to

in

re¬

and

also

commodity prices, the cost of
living, employment, inventories,
the security markets, bank loans,
velocity of
supply,
and
in

money

years, consumer

money,

recent

credit, etc.

Now, after all is said and done,
the
indices
register facts after
they have taken place and for
statistical data the lag is still

some

substantial.

authorities

Actually,

are

months

several

of

ernors

the

System

and

rectors

of

ahead.

Federal

of the
the.

The

boards

of

good

a

di¬

Reserve
cross

section of the business community,

supported

by

economic

research

of

When

testifying last December

before the subcommittee
nomic

in

Committee

balances

held

cash

the

by

individuals, businesses, and other
spending groups.
Credit restraint, moreover,
important
deterrent
effects

has
on

Stabilization
the

on

of

Eco¬

on

the

Joint

Economic

Re¬

Secretary of the Treasury
Humphrey, although not a mem¬

ber of the Federal Reserve Board,
was
asked
to
justify the hard

policies of

money

1953

far

so

as

the

ances

granting

were

and from funds obtained by
the sale of assets, where no credit

and
involved.

are

which

ways

eral

no

These

dampening

There

pectations

of
of

A

sumers.

too

by

may

'

sev¬

be

optimistic

business

rise

indirect

are

about

come

means.

creation

money

in

a

ex¬

and

con¬

interest

rates

produced by credit tightening will
tend to reduce the value of capi¬

development that will
turn discourage some new in¬

vestment

in

producers'
and

ers

save

less

equipment.

turn

Consum¬

may decide
either because they

to
are

that credit will be avail¬

for

possible

or

emergencies

fulfillment

ensure

plans,

in

and

business

more,
sure

able

construction

of

because the interest

savings has become

on

or

future
re¬

more

attractive.
The

key

fact

is

that

with

a

tightening in the credit situation,
banks cannot count with as much
certainty
of

on

will,

reserve

funds

therefore, tend to be
in their lending

restrictive

and
more

prac¬

tices and standards.

This restraint

both reflects and

a

process

of

is

part of the

credit

tightening. As
monetary climate
thus changes, bankers will
modify
their expectations about the gen¬
the

credit

and

eral outlook for business and

com¬

modity prices.
Applications for'
loans, particularly inventory
loans, will
be
more
carefully
screened.

labor market

sore

indices, like

commodity prices and inventories,
Secretary
Humphrey remarked:
"These

curves,

Mr..

Senator,

as

know, begin to show up long
afterwards. If you don't live way
you

ahead of the curves, you are going
a lot of trouble."

to be in

That

spelled

words,
tighter
in

or

in

out

so

many

that every step toward
easier credit involves a
of

the

what

conditions

months

ahead.

will

Like

it

not, central bankers have to be

forecasters and. their forecasts af¬
fect not

merely a single business
enterprise or .industry, but,, the
whole

No

economy.

wonder,

then, that central bankers tradi¬
tionally act too late rather than
too

soon,

caution
A nd

and

err

rather

on

than

the

side

of

recklessness.

the

Businesses which obtain

more so when, as in the
States Congress, some ap¬
to be eager to put the Fed¬

eral

Reserve

United

authorities

the

on

Criticism is much more
likely to develop when restrictive
policies are adopted than when
carpet.

easier

credit

It is

hard

is
to

and

instrument

"The

aid," he said, "gives
during
minute of flight, despite
new

the pilot his exact position
every

Women Elect Officers
SAN

landing

Garrett,

weather.

unfavorable

By

ANTONIO, Tex.—Mrs. Isa
of the firm of Lentz,

Newton & Company, San
will be installed

as

the

Fed¬

eral Reserve authorities this time.

Their timing seems
as

good

waited
a

new

as can

until,

to have

been

be expected. They
with production at

peak, the flow of goods to

Continued

page

22

Antonio,
Presi-

new

dent

of

In¬

vestment

single airborne unit the size

Women of San

he can
bearing
relative to a fixed ground station
instantly and automatically—and

Antonio at the

a

of

an

ordinary

shoe box,

establish his distance and

never-before-attained

club's

fifth

annual

dinner

meeting to be

accu¬

hleld

Tuesday,
Sept. 20, 1955,
5:30 p.m., in

greater

accuracy,"
he said, "will also result in wider
and

efficient

more

of

use

as

The

air

only

St.

Anthony
Hotel. Special

of 20

routes

miles

25

or

As

as

presently

be established in heav¬

can

where only

areas

one

previously possible."
"Availability of the system," he
said, "gives new impact to the
age-old dream of automatic, allweather air navigation and should
help speed the day when commer¬
was

cial flying, both locally and inter¬
nationally, can reach the goals
sought by the airlines. Its adop¬
tion by the Military Forces of the
United

States and

shadows

its Allies fore¬

chain

a

stations

ground

TACAN

of

that

of intensive research

years

in

U.i S.

Navy

collaboration

tonio.

Air Force, "was
unveiled
last
Thursday for the
first time at a press demonstration
and

aboard

FTL's Flying Laboratory.
flight also included the first
public showing of IT&T's new
"private flyer" TACAN—a com¬
pact, light, and relatively inex¬
The

the

private

From

off

to

time

the

fly

aircraft

it

until

the

the

over

DC-3

took

the

Federal

Tel

TACAN

to

Laboratories

at

duced

ley,

be used

can

with other

developed by IT&T
Navarho, a long-dis¬

tance

radio

1,800

nautical

with a range of
miles, and a new
low-approach instrument landing
system (ILS-3) -—to provide in¬
stant,
accurate,
and
automatic
guidance during every phase of
flight.
To the

aid

busy executive who must

operate

on

tight
schedule.,
important time

a

can

TACAN

be

the

Mrs.

are:

First

of

meeting.

Hursuline

Texas

Crum¬

Corporation,

First

Vice-President

man

of

Chair¬

and

Educational

Programs;
Miss Eithel Evans, The Columbian
Securities

Corporation,

Mrs.

Second

Social

and

Alice

Davis

Chair¬

of

Texas

Corporation, Third Vice-

President and Membership Chair¬
man;
Mrs. Lois Mann, Russ &
Company, Fourth Vice-President
Publicity Chairman; Miss Loraine Hislop, Dittmar & Company,
Secretary;
Mrs.
Ethel
Shapiro,
Lentz, Newton & Company, Treas¬
urer; and Mrs. Estelle Hardy, as

and

Past

President,

sentative

at

the

repre¬

for the

be

to

large

group.

Mrs.

Hardy of Dittmar & Com¬
has headed the club for the

past

year

at the

and will preside
Tb*

firm

of

Dittmar

&

Company will honor Mrs. Hardy
and

Mrs.

with

Garrett

cocktail

a

hour for the group preceding

din¬

ner.

consist

the

evening will
Matthews' speech

for

Program

aids

—notably,

attend

Besides Mrs. Garrett, other new
officers of the club to be intro¬

Nutley, N. J.
aviation

to

metropolitan

ready

was

-

have been, extended invita¬

tions

pany

owner.

land,
there was constant, automatic in¬
dication of its exact position with
area

*

firms

pensive unit tailored to the needs
of

be

Mat¬

f.
Principals and other interested
persons in San Antonio investment

National

by

occa-

will

o n

thews, City Manager of San An¬

man;

the

with

i

speaker

the

Steve

even¬

The TACAN system, product of
IT&T

s

Vice-President

will

tually blanket the free world."
10

for
Mrs. Isa Garrett

re¬

multiple

result,

a

ily traveled
route

guest

few miles apart, instead

a

Tapestry

Room of the

since it will permit the es¬
tablishment
of
multiple
closespace,

of

Mr.

concerning

municipal

the

affairs

of the

City of San Antonio, and a
short report from Mrs. Hardy, as
outgoing President, outlining the
past year's accomplishments of the
in

club

programs

Miss Frances Curts of Mer¬

gram;

rill

presenting
educational
and in its welfare pro-

Lynch,

Beane,

will

speaker

Fenner
&
the guest
officers of the

Pierce,

introduce

and

new

club.

an

and money saver.

line

Unlike the air¬
flies well-marked

pilot who

W. G. Nielsen Adds

air

lanes, the private flyer must
frequently travel off course in un¬
familiar areas.
Assuming that it
cost $155 per hour to operate a
modern

twin

plane,

reduction

of

a

-

engine
executive
in flying time

(Special to The Financial Chronicle)

BURBANK,

Calif.

—

Catherine

Meeks has been added to the staff
of

W.

G.

Magnolia

Nielsen

Co., 3607 West

Boulevard.

only 10 minutes

a day, through
navigation, would
saving of more than
single year for one

accurate

more

in

result

$6,500

a

in

a

C. A. Botzum Adds
(Special to The Financial Chronicle)

aircraft.

LOS

The developers of TACAN have

had

long history in the field of

a

radio
aids
to
navigation.
Com¬
panies of the IT&T System pion¬
the

eered

duced
ment

first

finder

instantaneous
in

1935

and

first successful

the

the

"firsts'

'include

vigation
the

U.

Other

system
now

S.

a

more

long-range na¬
(Navarho-Nava-

being

sponsored

Government

for

by

inter¬

has

of

West

Seventh

C.

been

A.

—

added

Botzum

John

to

Co.,

the

210

Street.
y

-

Form Minerals Devel.

intro¬

recent

Calif.

ANGELES,

David

staff

Instru¬

Landing System (ILS), now
equiDment
throughout

world.

M.

di¬

standard

globe),
on

the

means

of

rection

the objective.
condemn

guid¬

San Antonio Inv.

demonstration

significant ad¬

system.

may

or

forecast
be

it

although

means,

be

not

pear

the ready availability

additional

some

As to economic

areas.

tal assets, a
in

still

and cap¬

providing aircraft
a global scale.

Tele¬

press

compass

port,

Treasury was concerned.
It
was
pointed out that commodity
prices had not risen and there

spending out of existing cash bal¬

International

a

in air navigation since the
advent
of
the
automatic
radio

Reserve

Federal

banks who represent

money,

of

on

of the most

one

whole-^ quired.

production

—

be

sale

increases

expansion

of

amount

indices

fortunate.

limits

so

specify the

sure,

economic

direct

borrowed

curbs

to

tightening of credit
effect

ance

off

stricting the amount of spending
with

put

probably
unequalled
ability anywhere in the world, is

most

Laboratories divi¬

text

staffs

general

has

hard

are

composition of thee Board of Gov¬

consequences

set forth

art,

like

An explanation of unusual clar¬

ity

not

an

is

the credit
guided not only by
the indices as they exist but by
what they think they will look

member banks to borrow.

straint

art,

an

it

of

need

of

racy."

to

attempt

no

as

at

"TACAN's

interest rates,

restraint

able

spaced airways. It will mean that
parallel air lanes can be marked

considered

United

national standardization

Tele¬

translate into words just what de¬
termines policy, except in general
economic and financial terms. The

chases

of

Federal

Policy

science.

various

special groups of lenders
intent

Factors

of 1953, the Federal Re¬
serve began its expansive policies.
This took the form of large pur¬

to

suasion"

of

the

of

Executive

Federal

phone & Telegraph Co. described

with

a

spring

and

(2)

is

by the level of in¬
terest rates, but by their direction.
When the money market has ad¬
justed itself to a 2% rate, then a
shift upward of one quarter of
1% will signal a change just as
much as if the pivotal rate all
along had been 3% and Federal
Reserve policy in the direction of
higher rates began at that point.

Reserve

last

the purchase and sale
States Government se¬

by

chos¬

with the summer of
continuing
into
the

and

The

three instruments

restraint

Central

Policy
The

words, the significance

credit

measured only

Restraint and Its Significance
After

sion

of

vances

be reached.

quirements.
Instruments of Federal Reserve

re¬

TACAN

destabilizing interest rates
is the only way by which the goal

1952

/

communication

for

reasons

mind,

quiescent and the general
public is barely aware of the
functioning of the Federal Re¬

Busignies,

find

to

In other

the impact is on interest rates.
If economic stability is the end in

can

Henri

Vice-President

alert

major

a

airway of the future.

on

In general, they will

of

en,

seems

serve

for repayments

credit.

Federal Reserve Board.

policy

borrowers with outstanding

fusing credit requests or not meet¬
ing them fully and for accelerat¬
repayment
of
outstanding
loans, rather than eager to extend

guarantee
and
insurance
affect credit, but are not
directly wtihin the purview of the
are

pressure

role in the

ing

terms

Whatever instruments

navigation radio aid which is destined to play

be

gage

the central banker,

air

new

also

obligations.

Stock Exchange

decisions.
'

A

re¬

will

bring

policy and discusses the significance of the credit restriction
policy during last two years. Points out, because central
banking is an art, central banking authorities are hard put
as to what determines their policy, and they must always
look several months ahead to discount trends and formulate

[

actual

many

of Federal Reserve

Mr. Weissman describes the instruments

[
j

The I. T. & T. Demonstrates "TAOAN"

bankers to keep inventories more

-

Members New York

^to accumulate inventories

will be under pressure from their

PolicyFlexibility Is the Word!

Federal Reserve

Thursday, September 15,1955

...

WASHINGTON,
als

Development

has

been

1341
a

formed

G Street, N.

D. C.—Miner¬
Securities Co.
with

securities business.

M.

Belmont

dent

and

Ver

offices

at

W., to engage in
Officers

Standig,

Treasurer;

Goodridge, Secretary.

are

Presi-.

Eugene

L.

Volume 182

Number 5464

..The Commercial and Financial Chronicle

.

(1079)

15

>
_

I

2(c)

tures,

Economic Aspects of the
Robinson-Patman Act

where gov¬
ernment agencies and most pri¬
vate
citizens
and
organizations
an

that costs

(3)

Act

Section

2(a)

that

states

'

vision, "shall prevent differentials

increases the

of

costs

quantity

costs, and

sale

pricing...

limits proviso, permitting pricing according to
as
well as to meet

a

The

..At .the outset I wish
clear

that

concerned

to make

statements
the economic

my

with

injurious

as-

but

Act

is

bad

or

matter

a

is

law

law

makers,

not

am

render

not

fully in¬

voked

legal
ated

the

establish

few

so

discriminatory

sale

for

has

only

power

tubes

account

on

Commission

the

the

son

Robin¬

W.

Jesse

Markham

Patman

-

Act has

preventing
price
discrimination
that injures competition. Section
2(a) of the Clayton Act, up to
the

first

reads

proviso,

paraphrased,

follows: "... it shall be

as

unlawful

for

voked

this

ostensible purpose of

the

any

engaged

person

in

commerce,

the,

of

course

such commerce, either directly or
different

commodities

quality,
such

.

.

of

purchasers

like

grade

of

and

where the effect

.

discrimination

be sub-

may

stantially to lessen competition
tend

to

create

.With

this

of
or

monopoly."

a

is

in

tires

vehicles.

motor

sufficient

toward t^e
greater monopoly

and

power

creation

means

a

of

I, therefore, favor the re-

power.

tention

and

administra-

vigorous

tion of the Robinson-Patman Act.

This
£/vv*

morning I propose to suggest

4-Li

for

wi

n

{ +AA'f<

the

changes in

'

the Act.
In

An

Commitee's consideration

this

some

differences.

tire

'

economics

'

the

expressions

"price discrimination" and "lessening
of
competition
through

pricing,"
taken
together,
have
fairly precise
meanings.Price
discrimination is the charging of
different

prices to different buy-

that

ers

not

are

different

that

'

buyers

related

directly

to the costs involved.

This

Drices

means-

different

to

discriminatory

are

only

when the price difference exceeds

sustained

doing

tube

and

In
it

case

this
was

63 buyers

so

permitted
only

$2.50.

In

a

interpretation of "so few" is
broad' enough
to be applied to

Professor

Massachusetts

virtually the entire

economy,

Section 2(c) of the Act—the

so-called

brokerage

clause —dis¬

criminates against buyers who act
as
their own brokers.
The lan-

of this section would surely

guage

be

to

appear

ehoush.

reasonable

simoly states that "it shalll be

unlawful

...

as

Institute

of

1 C

is

.

." (italics supplied).

.

PT/

that

presumed

this

It

section; of

designed to prohibit

was

of

payment

unjustified

and

fictitious brokerage fees and allowances. For all practical purposes, however, the courts have
read the term "except for services
rendered" out of the Act.
In
Webb-Crawford Co. v. Federal
Trade Commission (109 F, 2d 268,
5th cir. 1940), the court declared

a

Act

for

the

legal, whether or not such payments were made for services ren-

prices to all buyers is discriminatory unless the costs involved are

following

of

means

Since the essential

also identical.
feature

that

of

competitive

reflect

prices

in

pricing

costs,

tition is lessened when

is

compe-

any

of the

following conditions exist:

(1),The

prices

in

differences

charged various buyers are greater
than

the

volved

corresponding
.

charged
than

the

differences

various buyers are less
corresponding costs l'n-

serv^es to P(lV fictitious brokerage .^es» a Pr£|ctlce the Act osten.si.b]y Purported to prevent By
|0

(2)

0f

guch

Identical prices
among

vary

services,
fosters

charged

bution.
jnation

buyers.

It

even

the

rendering

per

se

illegal,

traditional

It

imp.ied in its title,
prescribes and encourmuch price discrimination,

purpose

does
*A

the

the

this

in

statement

cf

Judiciary,

several

ways,

no

by Prof. Markham before

Subcommittee

Monopoly

the

on

before it.

should

be

be

place

the

rule

defense for the

a

Sec.

easily

the

made

(a)

the

of

amended

first

so

Act

can

to

as

proviso

ex¬

re¬

with

this

definition of price discrimination:
"Price
discrimination
is
herein

of

construed

ers

the

as

of

act

charging

prices to different buy¬

that do not correspond to their

differences.

cost

discrimination

portion

of the

that

consists

the

of

not

does

price

The

of

that

difference

Correspond

to

the

cost difference."

changing

market

tential

extant."

or

the

have

The

kind

injures

of

sufficient
vide

been

classes of

though

ing;

and

tions

of

(3)

lead

customers,

they

man

meet

an

price uniform¬
circum¬

under certain

under Section 1 of the Sher¬
and

with

is

therefore

power

ential

prices

form

of

from

price

sellers.

out

it.

The

substitute

would
encourage
price
competition and would therefore
benefit
group

been

but

that broad
all hold mem¬
seem
to have

consumer,

in which

bership

jobbers,

the

we

who

overlooked

in

all

the

inti-

trust, price support, fair trade, and

who also sold at retail, were clas¬

for

preferential

exclusion
fall

of

such

in

cations,

buyers
groups,

and

that

are

the

prevents

is

not

or

undercut

tion

reflects

power

and

price discrimina¬
existing monopoly

may very

that

power.

urge

that

I

therefore

laws^ be

used to diminish
so

well increase

would
antitrust

the

monopoly

the secured joint and several

the

on

Senate

Aug. 23,

Anti-trust

tommmittee

1955.




and
on

the statutes

This would get at the roots of the

problem

rather

than

ficial manifestations.

Maturity

obligations of the twelve Federal Land

of various States.

99%% an<J accrued interest
offering is made by the twelve Federal Land Banks through their Fiscal Agent,
Nation-wide Selling Group of recognized dealers in securities.

with the assistance of a

m that it forces
distributors and inte-

grated

distributors

to

Drices

relative

the

to

pay

John T. Knox, Fiscal Agent

higher

costs

VOlved than do high-COSt and

Un-

130

in-

integrated

distributors.

Hence,

aside from its discriminatorv fea¬

September 13, 1955.

Act

would seldom need to be invoked-

issued under the authority of the Federal Farm Loan Act as amended.

under

power

that the Robinson-Patman

discrimination
low-cost

com¬

continuous

Bonds are eligible for investment by savings banks under the statutes of a majority of the States,
including New York and Massachusetts. The Bonds are also eligible for the investments of trust funds

This

a

petitor's price in a particular trade
channel or region.
Unsystematic
and sporadic price discrimination

underlying
channe!s.

impro-

temporary

a

The

an exam-

facts

lo-

William Street, New York 38, N. Y.

,

its

-

shift '

reflects the sellers price policy,

and

Due September 14, 1956
Not Redeemable Before

are

not

or

readily

2%% Consolidated Federal Farm Loan Bonds

Banks and

do

It is continuous in that

Federal Land Banks
1955

>

treatment

classes

cannot

$130,000,000

The Bonds

is

buyers falling in a particular size '
group, class of business, or pos¬
sibly a particular location, at the

New Issue

Dated October 3,

•

This '

discrimination

usually systematic and continuous.
It is systematic in that it singles

incon¬

phrase

tions; in the Standard Oil of In¬
for example,

"to

gives rise to price fixing

Act

sistent

perform different marketing func¬

case,

di-

and

cases

of pric¬

pricing, and therefore discrimina¬
tory pricing, when buyers in fact

diana

to

various

sufficient
of buyers to extract differ¬
or

intensifies competition. Systematic

which

stances

uniform

to

their

the Act encourages

ity,

competitor's

a

than

rather

arbitrary classifica¬

sellers

involves

sellers

of

price"
equally
low price of a competitor" as the
Act now reads. In its present form

existed; (2) since

did riot exist for purposes

or

administered.

competition

cost differential

meet

I

discrimination'*

exploit

vision to meet

"to

po-

•

price

power

and

into them.

read

to

conditions,

the rest of the antitrust

way

statutes

undersell

as

pro¬

In
conclusion,
it
should
be
pointed out that the only justifi¬
cation for a special statute against
price discrimination arises out of'

vised

so

following
"And

ulant to competition or in response "
to
forces
of
competition
and

great that sellers act as though no

..

-

a

further, that nothing here¬
in contained shall prevent price
changes at any time the seller
wishes to do so, either as a stim¬

it

as

prices

vided

and

distributive

of

varjous

actually
ages

ruling

the

as

(3) The "good faith" meeting of
competition defense should be re¬

differentials

re¬

thereof

substituted:

high cost methods of distri-

correspond-

are

for

Discriminau"nSl;laTonntraryntt" ^ore importantly, it fosters price
the

re¬

Pricing in accordance with

costs

(1) The cost of assembling data to
price
differences
is
so

cost

that

lieu

price adjustments

or

compensate

often

various buyers wheh

ing costs

prac¬

such
be

that

justify

broker completely independent of

the buyer."
These interpretations have the
effect of forcing integrated buyers
who furnish brokerage and other

fide services,

.

prices

in

volved.

(3)

pricing

In

making payments for such bona

'

The

(2)

in-

costs

or

if Congress intended

Court's

now

case

reasons:

services rendered" to read "except for services rendered by a

also

repealed

The quantity limits proviso

Supreme

dered.
Other
decisions
have
interpreted the term "except for

It

cost.

be

consistent with both the

above

necessary consequence

presumption

all payments of brokerage to anyone connected with the buyer il-

that identical

falls short of the difference

or

not

respective

is

com¬

ultimately
be
repealed.
However, this should await the

Tech¬

the

be

does not estab¬

should

should

Act," Stanford Law
6, 1953) that price
as

should

that it

so

phrase

son-Patman

such

concerned"
the

This

(1)

large.

discrimination

acts

extension of NRA.

different

vol.

two

should

were

Adelman

good

an

has argued convincingly
("The Consistency of the Robin¬
Review,

the

the

to

maining body of antitrust law and
the precepts of
competition the

accountants

Morris

obsolescence

be what Congress intended
be, and do. If so, the Act

However,

commission, brokerage, or other the burden of proof is on the
compensation, or any allowance seller, and since the introduction
or discount in lieu thereof, except of some uncertain cost element is
for services rendered in connec¬ likely to prejudice his entire de¬
tion with the sale or purchase of fense
her must treat some or all

goods

together

tices

the Com¬

differences

perishable goods,;
of
seasonal
goods,

cumstances.

companion

a

that the Act promote

nology

This

(2)

it

amended.

costly study made

cost

pre¬

imminent:"

or

of

only change from time to
time, and under the direst of cir¬

Minneapolis-

public

three times

the

•

than would

critics of the Act have

many

ception.

in

certified

more
rigid,
higher prices

to actual

distress sales under court
process,
or
sales in. good faith in discon- *
continuance
of
business
in
the

lish

contained

by

in

and

consumer

rather than

quantities,

carload

the

Honeywell price differences were
judged to be justified on evidence

purchased

in

results

should

price difference

a

it

uniform,

prevents
Simultane¬

may
it to

the

difference

cost

a

it

as

some

marketability of
goods concerned, such as but'

the

not limited

prise

thereby disallow¬
ing that portion of the price dif¬
ference'that was
cost
justified*
In Kraft-Phenix the Commission
toto,

proviso of Section 2(a)

changing conditions affecting the

worded

of¬

by

fosters

Act clearly needs
amending along
cost justifi-. <the
following lines:

the

rejected
in

cation

that

the

-

.

mission

in

and

final

"That
nothing herein contained
shall prevent price changes from
time to time where in response to-

that

grounds that they

fully

But

accounting for 29% of the market

of, the Act

wording

facts.

of

invoked because "only"

it

in full

am

not

were

the

on

pre-

Miller-Tydings Act, and have said

by
respondent to justify
price differences to different cus¬
tomers

therefore

labelled

Commission

differences

cost

pre-

differences that

the

Brands

the

discriminations

the

deed,

(29 FTC 121,

fered

$3.62 to justify

for any person
to
agreement.
Price discrimination pay or grant, or to receive or
is at once evidence of monopoly 'accept,
anything of value as a
I

purpose

rejected

that

cost

rubber

Standard

evidence

price

many

reflect

in¬

was

.

could be used to

power

vent

indirectly, to discriminate in price
between

in¬

once,

rubber

of

conditions under which it

The

to

as

.(Quantity Limit Rule 203-1, 17
iFed. Reg. 113.) But the particular

Act.

in

this

in

ard.

prob-

with

and

when it finds

.

are

The

1951

associ¬

e m s

.

unjustly

..."

1

.

differentials

thereof

therefore

on

"fix

to

quantities

er

and

formed

to

This is well illustrated by

the Standard Brands

it

vail in the absence of the Act. In¬

apolis-Honeywell (FTC v. Minne¬
apolis Honeywell Regulator Co.,
344
U.
S.
206, 1952) cases.
In

that available purchasers in great¬

lawyer,

a

lowbuyer

a

high-cost

a

the
—

deterioration

Act

ously,

difference in cost would

reasons

market for or the

more

1939), Kraft-Phenix Cheese Corp.
(25 FTC 537, 1937) and Minne¬

quantity limits

ultimately the
public, must
I

justify.

pricing,
when taken together they have

Commission

and

decide.

extremely

it

distorting cost-price relationships.
First, a proviso in Section 2(a)
empowers
the
Federal
Trade

the

good

a

be

may

competitive

to

to

price

discriminations

the clear and discernable effect of

the Robinson-Patman Act.

Whether

which

of

one

are

than
the

But

purpose

other discriminations.

seller to charge

a

Act.

useful

a

The

.

makes

wording

relatively higher price to

cost

competitor.

.

same

awarding of fictitious bonuses,
discounts, and fees to large buyers
simply because they are large.

manu¬

or

permissible for

than

a

of

serves

grant

allowance

cost

in

(4) For the

noncompetitive

the

delivery .
."
This wording and the
procedures
it involves, foster discriminatory

allowing pricing to undersell
the price of

due

only

differences

facture,

distribution, and, in addition, it has dis- V
Urges amendments to the act, repealing

criminatory features.
the

for

make

th3

over

past several decades.

enables antitrust agencies to
pro¬
ceed quickly against certain fla¬

nothing contained in that section,
except the quantity limits pro¬
which

the

are

labor legislation enacted

discriminatory effects of the sented in (3) above, that part of

Robinson-Patman

ready too high.

Though agreeing with the purposes of the Robinson-Patman *
Act, Prof. Markham finds, instead of preventing price dis- •
crimination, it actually prescribes and encourages it. Says it'

it

These
and

al¬

are

along with retailers who did
jobbing.

no

area

have concluded

By JESSE W. MARKHAM*
Associate Professor of
Economics, Princeton University

sified

increases the costs of

distribution,

super¬

16

(1080)

•

The Commercial and Financial Chronicle

tem

probably will be intro¬
on
the highest price

lines at first, which postpones
the money-making potential

By WALLACE STREETE

until at least 1957

Thursday, September 15,1955

The Working of Anli-Trnst Laws

duced

THE MARKET... AND YOU

...

By RICHARD B. HEFLEBOWER*
Professor

of

Economics, Northwestern University

later.

or

Professor Heflebower reviews various phases and segments

Selected stocks put

Short-Covering in GM?
on some

wild shows this
week, mostly
on stock
split news or

hopes

of

it.

But

overall

it

previous high mark reached
in June.

cut-

There
of

tests

was

the

clear-

no

old

highs,

The
in

strength

some

of

to

be

seems

the

however, as demand failed to nical. General
Motors, for in¬
perform¬ develop. Afterward the aver¬
stance, is getting close to the
ance with the rails
stubbornly age retreated from any chal¬ time when the
stpck split will
refusing to "confirm" the in¬ lenge even while the indus¬
be effective.
And the issue
dustrials' emergence into new trials were
forging to a level has had one of the
larger
all-time high
ground, and a 100 points over the peak of short
interests for many
disposition apparent to take 1929, the 381.17 figure that
months, leading to more than
profits rather willingly on stood as a "fabulous" high
a
suspicion that its new-found
strength.
until last year.
strength probably is due in
if
if
if
Split Excitement
large measure to short-cov¬
Another fact that blunted
ering.
Reynolds Metals started off somewhat the
❖
*
^
significance of
the
sprinting spree late last the new
high for the senior
For a merger move, the bet¬
week and again this week. Be¬
index was that it was pinpoint
ter acting candidate for a deal
fore it ran out of steam the
strength of a few pivotals that with some
larger company
price of the stock had appre¬ did
rather

was

charmed circle little

was

has

Match

Diamond

been

ac¬

which found enough support
complished. In fact, when the to
actual
put some successive new
trading. It all reflected previous
high was posted late
much more demand than the
highs together. One of the
last July, it was on a day
odder firms mentioned as the
5-for-l split
currently under¬ when more issues declined
likely party of the second part
way would normally inspire. than
advanced. The same was
*

,

*

true again this week which is
Reynolds subsided,
hardly the pattern for a rag¬
Gypsum also proposed
ing bull market. It is more
5-for-l split which started
the

When

fireworks

in

that

of

pattern

issue,

in¬ market

with

bull

tired

a

the

important
cluding a one-day runup of as
exception up to here that re¬
much as $29.50 a share at the
actions don't generate selling
peak. It nudged its high an¬ and the
market subsequently
other $10
along before it, in
nudges ahead grimly.
turn, settled down for
after
for

posting
stock

a

this

rest

a

*

price of $335

a

that

sold earlier

if.

comparison

duces the story

$

*

marked
This

at

in
issue

less

even

Reynolds
sold

this

than

$110 and
only crossed the century
mark last year after
selling
as low as
$51.67 in 1954. Five

year

had

years

only

a

when-issued

stock

most-active list

made

the

Stores Favored

re¬

of the indus¬
bit

a

is

dled
the

a

Here, again, it hind the market for half a
tale of an unbri¬ dozen years with McCrory

a

bull

market.

market

had

time of calmer
own, or

Whether
to

come

action

a

its

on

Stores,

so

for

instance,

widely
expected to restore the $1.1*0
dividend

before

the

is
This would put it in the
yield bracket which is

whether the cumula¬ out.

tive effect

far this year

year

of 7%
"study" by downright handsome against
*
Congress, higher margin rates some of the other yields that
There were some other and, lately, tighter
money has range from a fraction of a per
solid gains achieved else¬ finally slowed it down
psy¬ cent in Rohm & Haas to less
where. The achievements chologically is a moot ques¬ than
2% among some of the
^

pale

when

the

against
issues but

considered

the stock market

tion.

high¬

measured

flying

would

excellent

at

any

chemicals,
A Well

be

other period.

One
able

Acting Issue

issue

on

yielding

that

has

been

to

put

American
Oil

of

Potash, Standard

New

Jersey, Owens
Corning Fiberglas and lowpriced Eversharp.
*

That there
blue
able
some

There

for around

group

quarter of

a

low

century
if

a

now.

if

respect

♦

were

still

some

to

the

bullish

has

Some
have

of

the

food

stores

been

faring somewhat
better profitwise with a bit
of emphasis
occasionally cen¬
tering on Safeway Stores and
Grand Union.

been little in the market let¬

on

ters to account for it.

sues

to

be

due

to

the

It

seems

fact

that

Among is¬

that have had poor
profit
results recently which are be¬

plans in the auto capital indi¬

lieved

corner are

cate carburetor is

gate Palmolive and Detroit
Steel, with the latter helped

out and forward
vors

fuel

such

as are

on

its way

planning fa¬

to

have

turned

the

Lerner Stores, Col¬

systems by an expectation that re¬
standard on Diesel sumption of dividends will

injection

sentiment, but the technical
engines. Bosch is rated as one also occur before the year
situation wasn't
overly auspi¬ of the two companies in the ends.
cious. The dour note was the
country that have developed
[The views expressed in this
divergence of the rails again injection
article do not
necessarily at any
systems for gasoline
after
time coincide with those of the
they had climbed to motors. As with other auto¬

within less than

a

point of the




to

the

the

relationship

be¬

or¬

their

in

economic

analysis

policy.
Second, while

I

realize

certain

mergers

were

make

motive

-Chronicle.

developments, the

sys¬

a

The

Act.

particularly

Heflebower

B.

R.

a

observations

the

power to injure com¬
petition by discrimination and by
excluding rivals.
Hence, it is
necessary to have on the books,
and to have enforced actively, re¬

that

on

that which I am
going to have, is
individual companies
are

that

have

to

held earlier, I
will

not

and

we

such

directed

marily

is

their actions.

industries,

that

hearings
pri-

e

Robinson-Patman

Having said this, I must, never¬
theless, go on to add that the or¬
ganization we have now in many

lic

t h

the

of

and

of pub¬

as one

re¬

regulatory agency nor
companies likely to compete
vigorously
when
hanging over
their heads from day to day are
detailed
governmental
controls

both

a

the

maining provisions of the Clay¬
ton Law, and its amendment by

are

problem

as

on

*

effective

conduct

viewed

urges

because of that failure,

government

ganization o f
industries and

subject.

straints

I

not

merely

that the

mean

that the relative size of companies
will affect their conduct, but also

that

their degree of vertical in¬
tegration, the extent to which
they also engage in other types of
business, the degree of success
they achieved as sellers, the va¬
riety of channels in which they
sell, and the degree to which they

of that organization.

quence

This

what
I

applies

realize

firm

tions

tionary
the

an

be

discre¬

consequences
oc¬

the

on

of firms

conduct

the size of ours,
dynamic character,

its

relatively little to fear
changes in the organization

from

industries

which

emerge from
degrees of success
which companies achieve in mar¬
ket rivalry. In this market strug¬

different

the

gle, even where the tactics are not
entirely fair, each company has
prove by actual performance
that
its
capital investment and

those

They

are

presented

of the author only.]

.

J

as

other decisions have been wise.
will

make

its

decisions

with

It
re¬

to expansion with the full
understanding that these outlays
will prove to be successful from
the company's standpoint only if
spect

they aid the
and

a

buyer

policy

view¬

company

as

seller.

a

From

public

point, emphasis

on

tion of industries

the organiza¬

rather than

the

conduct of firms has the outstand¬

ing merit of minimizing the de¬
gree to which government agen¬
cies find it necessary to regulate
the conduct of companies.
The
danger we face is that we will
those

Sherman

the

Act

and

Clayton

Law

of

the

industries too little and fall back,

fore

statement

the

Trust

ciary

result

the

as

of

some

com¬

panies
rising
to
dominance
through market rivalry.

Indeed, it is unfortunate that al¬
a
quarter
of
a
century
between the 1926 court

most

elapsed

decision which

made the old sec¬

tion

the

of

seven

Clayton

Law

inoperative and the enactment of
the new provision.
But that is
history.
The present issues are
whether the new provision is in
fact adequate to deal with all of
the problems and whether that
law is being enforced vigorously.
As I read the new section seven
and its

legislative history, it does

provide exact guides v/hereby
the
enforcement
agencies
can

not

judge whether a proposed merger
would substantially lessen com¬
In that I think the Con¬

petition.

wise. Perhaps the ex¬
perience under the new provision
will
demonstrate
that
certain
was

types of mergers should be made
illegal per se. As of now, it seems
to me that such rules would not

really help because the only mer¬

I could with a
provide per se
rules are obviously illegal under
the present legislation. It does not
help the administrative agencA to
have the easy cases settled for
What it needs is guides for the
marginal cases which are on the
border of damaging competition.
for

gers

clear

which

conscience

The present legislation calls for
appraising the marginal cases on
the basis of a quite full under¬

standing of the organization of the
market and of the acquiring firm's
not

Such

be made

the basis of
about

a

an

appraisal can¬

by junior clerks on
few bits of evidence

the firm

and the industry.

complaint on the
present personnel of the Federal
(This

is

Trade

not

a

Commission,

but

on

its

budget for this phase of its work.)
Such an enforcement procedure
would lead either to failure to act

important cases or to issuance
by the Commission in
cases which it could not sustain in
on

parts

that deal with the organization of

*A

tive

role in it.

the

enforce

relatively little to fear
organization of industries
clearly non-competi¬

will become

gress

have

we

of

to

logical

economy

with

and

of

While

place which the firm
in the industry.

cupies
In

appear

are

most

do.

relatively large
discretionary ac¬
self-injury, most

take

which

firms

a

without

acts

of

that

can

to

even

individual

to

cate the troublesome and deli¬

if

chips among the issues
to climb
easily was of
comfort

usual.

normal

on

Among the is¬ good
independent action de¬
might be grouped
spite the general market is
in this
category were General American
Bosch which has
Motors, Magma Copper, Sears
also been somewhat more ac¬
Roebuck, Aluminium, Ltd., tive
than

the

*

occasion

that

sues

My testimony will cover three
topics.
First, I will out¬
my
general viewpoint with

tween

Brownell's
laws
down to a level

General

laws, and

bringing prices and costs
adjusted to efficiency.

line

a.

somewhat'

were

anti-trust

major

few

market value.

as

something
regular item and even
managed to land in the top
slot on
only its second day of
trading.
of

view

in

analysts is the store division.
July and at the end of With the blue chips at a lowAugust. Peaks were recorded yield level and many of them
at the end of the month or
apparently bumping the ceil¬ are low or high price sellers, will
close to it on both occasions
influence market results. In my
ing, the interest has turned to
judgment, once one fully under¬
yet the later comparison the
secondary group in which stands the organization of indus¬
showed the very minor de¬ most of the
stores are rated.
try, he will find that most of
crease of 0.4% in the overall
They have been lagging be¬ the conduct is a logical conse¬

the stock sold at
is hardly
shade over $20. The

ago

have

the

on

Eversharp is also fea¬ Third, I will deal with some
parts which have this degree of power
in merger rumors and of public policy which is
designed in the market.
to affect the way
while it, too, has been able to
companies, par¬
Because
our
primary reliance
ticularly the large ones, compete.
should be on public policy affect¬
post some repeated new
Both in economic analysis and
ing the organization of industries,
highs, nevertheless there public policy, primarily emphasis
the need for strong restraints on
seems to be
enough skepticism should be placed on the organiza¬ mergers which s« reshape indus¬
so
that rapid advances are tion of industries, for the way tries that
competiiton is injured
firms compete stems, in large
part, is self-evident. Such legislation is
clipped back rather abruptly. from the place
they occupy in the in line with
my observation that
This has happened repeatedly. market in which
they sell. By this we have

of

is

Committee

case.

stocks listed both at the end

*

comparison

Metals.

that

«

tured

Despite the overall market
the action the group most favored
average price of by the majority of market

$114.

more

this

in

National

observation,

One

at $214 and could trial
average
have been
bought last year at
comparable
year

The

%

Chemical

Allied

is

*

U. S.
a

Attorney

pinpointed

the trick and outside the

Holds the danger

lies in the anti-trust laws
dealing too little with the organiza¬
tion
of industries.
Upholds

a

ciated from around 250 to 300
in little more than a week's

of

laws.

industries rather than the conduct of firms.

tech¬

more

anti-trust

States, from a public policy viewpoint,
emphasis should be placed in the law on the organization of

and activity
blue chips

bit

a

the

Senate

by Prof.

Heflebower be¬

Subcommittee

on

Anti-

orders

of

a

court action.
I

am

referring to the

which the Congress

provision

makes for the

and

Monopoly of the Senate Judi¬
Committee, Aug. 22, 1955.

Continued

on

page

31

Volume 182

Number 5464... The Commercial and Financial Chronicle

(1081)

This Civilian Serves in the ARMY,

NAVY and AIR FORCE!

You'll find him
marine

...

at sea

aloft in

in the atomic sub¬
B-47 bomber.

a

and in the field with

..

known

United

to

the

Armed

Forces

Philco

world

States
the

"TechRep".

The

TechRep is

electronics— a

over

as

As
can

in

an

manufacture.

an

expert's expert

man,

on

and instructor.

electronics systems

engineer, he

take full command of any

an

as

instructor, he

can

quickly
was

train both officer and enlisted
in

a

technical

other

situation

and




original idea to

an

meet

the needs

is

he

can

are

go
to

of the fabulously complex

FIRST

active

FROM

overwhelming

an

They have set

a pattern

success.

for efficiency.

improved performance. They have

every

field branch of

brought

to

ization with

under complete military control,

where the Armed Forces go,

have

given

The

military electronics standard¬

flexibility.

result

is

their

lives

on

duty. They and others have won

every

citizen has

vital

the front.

THE

been

They have eliminated duplication and

strip down,
Some

with the flood of new elec¬

cope

applications, Philco TechReps

of these civilian experts on

presence

duty with

They

engi¬

today of more

by the

than 2,000

active

have

TechRep's importance to

over-all defense program

America's

indicated

and

overhaul.

man,

ANOTHER

As

tronic

key electronic devices.

The Philco

repair, and reassemble the most compli¬
cated of any

TechRep Division

neers to

even

As

the

since

started in 1941.

of the Armed Forces for trained

testing and evaluation, site survey¬
or

than 12,000 individ¬

Communications, Radar, Fire Control,

planning, operational development,

ing, installation,

more

personnel

repair and maintenance techniques for

the Services.

field

citations. And

ual letters of commendation have been

received
And

rigidly-selected and rigor¬

technical

or

use

Sonar, Guided Missiles, Computers

ously-trained combination of engi¬
neer,

military equipments in

today—regardless of make

"skysweeper"

a

anti-aircraft battalion—the civilian field

engineer

electronic

and

interest

something in which
a

lasting
—

more

defense per dollar!

punrn

CORPORATION

17

18

The Commercial and Financial Chronicle

(1082*

Thursday, Scptemher 15,1955

...

jC
Continued

techniques has had an equally im¬
portant role in the reduction of
the average age of home owners.
"Time" magazine recently quoted

from first page

Finance

Trends in Housing
currently have incomes after taxes
of over-$5,000 a year—compared
with 40% in 1945.
Furthermore,
there
has
been
an
increase
in

statistics
average

equity

that will entitle I im to
if leniency is required.
other words, the creation of an

the

to

of home

age

been reduced

(D)

Changed Methods of Home

Thirdly, and far from last, and
equally

contributing

the

with

housing shortage and the increase
in family incomes to the housing
boom, have been the changes that
have come slowly and almost un¬
noticed in

methods of financ¬

our

ing.
of

Some

the

enumerated

(A)

changes

be

may

follows:

as

The

monthly amortized
mortgage which is followed now
by
all
lending institutions but
which
the

'30s

sively

depression

used

was

almost

of

Some

the old

three

go

that

in

on

the

re¬

style form of financ¬

five

or

of

may

you

ing where the home
borrow
$10,000 for
end

asso¬

and

period

a

of
the

at

and

years

time

would

owner

have

would

to

something down
then renegotiate
loan for the remaining balance.

a

This

pay

debt and

of

form

home

financing did

not stand the test of time.

(B)

Low downpayment financ¬

ing which has resulted from
(1)

government guaranty and
insurance—FHA and VA

(2)

'careful and

more

intelli¬

gent valuation of property

(3)

careful

more

the

analysis

borrower's

of

credit

(4)

'

i

home

lending

mortgage

becoming

}

business

full-time

a

and

the

experienced businessmen.

tferm

(C) Longer

carefully

with

comes

mortgages

related

covering

to

family

in¬

monthly
payments
of time suffi¬

period

a

ciently
long to make monthly
mortgage payments somewhat
comparable to rent. We have come
realize

to

that

it

is

important to

relate

financing plans to the eco¬
nomic life of the type of property
being financed. For example, auto¬
mobile financing typically is lim¬
ited to

period of from

a

months.

the

While

18 to

24

automobile

will

last longer than this, it be¬
gins to deteriorate after this pe¬

riod of time.

trailer
over
a

car

longer

year

period,

10

year
over

In each

still

a

the

case,

type of financing, to be sufficient,
must

bear

relationship

a

the

to

economic life of the type of prop¬

involved.

erty
the

intelligent

merely
on

No

try

the

to

longer

mortgage
sell

smallest

a

the

does

lender

borrower

amount of

for the shortest period to

money

of

There

is

this

danger, of

widespread use of favorable
housing markets,
to¬
the total market
gether with standard type amor¬
for appliances is fantastic.
tized loans, this has not been the
(F) The creation of a so-called case in the postwar period. The
secondary mortgage market pri¬ typical family
today
will own
marily through the FHA and VA more than one home during its
lifetime. A home purchased when
program, whereby the pool of in¬
vestment capital
in the East is the head of the household is in the
funneled
into
other sections
of late 20's or 30's is usually sold or
the country, such as California, traded in on a larger home as
which have traditionally suffered family requirements expand. Typ¬
from a shortage of capital.
ically the first home is not com¬
The result of these innovations pletely paid for but the equity in
in mortgage financing has been it is, in effect, "traded."
the

for

greatly

a

This
broadened
market
for
entirely new
ownership and home ownership has greatly in¬
expanded market for creased the need for savings which

of

creation

market

an

home

those

sell

things to home

all

whose

one

who

way

home

manufacture

business

is

Spotlit

or

and

and for

owners

dependent

op

active

an

building industry and

on

in

the

disservice

those

of

us

who

ample, that 30
yond

the

sound,

and

standpoint
home
loan
the
Of

loans

that

is

reasonable

of

the

interest

from

cost

importance

after

monthly

five

30

rower

only
has

11%,
not

the

has

and

$8,241.
fact

regular

principal
been

the

established




year

the

of

the

of

interest,
is

is

years

payments

balance of the loan
duced

be¬

are

total/cost

ownership. On a
$10,000, at 4%%

total

ex¬

practical,

of

equal

that

believe, for

year

term

the

to

owner. There are

re¬

bor¬
an

used

be

can

the

pur¬

repair,

and

finance

to

construction,

chase,

As

modernization of homes.

a

building, and home ownership, the
total

of

amount

increased.

private debt has

You

doubt,
things we have created an entirely heard or read many expressions
of
alarm
new
concerning
the
tre¬
generation cf home owners.
mendous growth in personal debt
Prior to the depression of the
in recent years.. There has been
'30s home ownership was usually
some
talk
in
Washington about
considered
within
the
reach
of
the danger that a too rapid growth
only mature families or children
in debt may be setting the stage
of well-to-do families.
Today as
f^r
another
serious
depression.
a
result of changed attitudes re¬
This merits careful study.
garding
home
ownership
and
improved home financing young
I have not wanted to bother you
dential

real

families

in

estate.

their

expect to take

Among

20's

confidently

the responsibili¬

on

ties of home ownership.

in

gaged
dustry

Those

manufacturing

realize

plications to

full

our

other

the

bridges

and

the

had

in¬

and.

available

you

care

new

and

and

and

for

reference.

'

Chart

if

distribution

for.

take them with you

to

indicated

As

on

C, the total individual and
debt has trebled

non-corporate

house,

streets

sewers

statistics in the
presentation but
several charts printed
my

im¬

sales market and

build

we

come

have

no

many

of

course

and

economy of this
generation of home buyers.

First

too

the

well

over-all

then

en¬

with

have,

the

storm

during

the

postwar

billion

54.6

of

One

1954.

drains and water works and flood

end

control, and then the schools and

of

the

at

the

of

to

1945

billion

162

from

years

the end

at

estimated

an

components

churches and
commercial

hospitals and other

ventures, and before
the little family

get through,

we

who embarked

on

a

home

owner¬

94 billion in

quite

mortgage debt,

chain of economic events.

Gen¬

is

program

have

con¬

times

struction in recent

years

the
con¬

and

an¬

from

Before

to

be

noted.

given

utility construction for

that

The

volume

In

their
has

we

million families owning
homes

own

been

and

increased

to

this
25

figure
million

in 1955, or an increase in the home
ownershio

from 41%
As

I

measured

come.

1940 in the United States

11%

have

a

the

debt

that
ures

mentioned,

in

home

financing

of

burden

not

by the relationship which
debt

of

bears

even

income

given

our

volume

that debt and

country

heretofore

real

at

to

in¬

shows

these

plotted

as

I

ual

will

note

debt is

a

that

prewar

the

higher

even

a

problem only during a period of
stagnation. .The problem in the

last

two

decades

is

likely to be

rather

t.ian

over¬

saving.

continuation

a

an

Over-saving is

Actually, as a recent "Fortune"
pointed out, the current
rate of saving is not
significantly
higher than it was in prewar
.

of this rate of increase in the ratio

of debt to

acticle

income might

begin to
have serious consequences before
too long.
The

cost

relative

is

t

interest rates

much

in

the

prewar

risen

saving

higher,

and

they

tiue

Interest

ago.

than

it

in

fact,

it

of

their

recent

How

years.

in

lower

you

much

as

were

for your

product

generation

a

as

ago?

It

of money.
to

you

in

Among

our

Sam

little

a

been

the

low

cost

a

of

the

to

react

difficult

more

product

your

normal

laws

of

the

Another

ture

A

of

I

typical

in

must

of

was

the

loan

short

amortized.

not

some

our
na¬

of

Second

even-third

cases,

and,

mort¬

Today prac¬
mortgage
loans
are

gages were common.

tically

all

amortized

of

debt

second

and

relatively
ably also
42%

add

outstanding mortgage

residential

underwritten

properties

is

tirely

not

en¬

tend

to

dumping

the

on

is

will

wild

any

estate

programs.

of

such

market

characterized

as

I

that

but

is

in¬

government

trend

a

healthy

prevent
real

by

guaranty

and

surance

mortgages

I should prob¬
that today some

scarce.

our

on

This

1929-1933.

might also mention the fact that

financial" institutions

engaged

in

the

mortgage lending business are
in a much stronger position than
they were a generation ago and
enjov

higher

a

of public

measure

I

co

net want to leave you with

that

impression

crease

home

in

especially the increase
debt.
Cbvi-

mortgage

rate of

cusly the
few

last

mini¬

am

e

and

years

I

significance in the in¬
of personal debt in recent

mizing t

years

increase of the
cannot continue

indefinitely, but I do not believe
that the size of individual debt,
when

to

of mortgage contracts, and
values, generally has yet

asset

a

where

point

need

we

Neither

I

do

believe,

as

we

problem
Economic

our

of "over-saving."

one

changes which appear to lie ahead
suggest,
in fact,
the need for

increased
expanded

savings

to fi¬
investments in

capial goods which produces con¬
sumer

'goods and

vastly

housing inventory.

our

term

increase

For short-

a
reduction
in
the part of consumers

periods,

spending
and

on

business

increased

firms,

as

a

result

bring
about reductions in the volume cf

of

much

savings,

may

In the long

business activity.

on

This

not require
therefore not

But to get the

relatively increase in

living,

vert
a

an

road

does

and

saving.

mud

a

same

standard

our

would have to

we

ordinary

paved

con¬

road

to

four lane divided

this

requires

therefore

highway, and
lot of capital and
of saving.

a

lot

a

You

all

are

familiar

with

the

increased investment need in each
of

lines

your

of

business

goods and services which
be

10

15

or

of

will
to produce in the

called upon

next

fi¬

to

the much greater output

nance

you

You

years.

may,

however, not be familiar with the
tremendous savings which will be
needed

in

the

housing

field

and,

on

the part of savings institutions

to

finance

mand

America's

future

de¬

for

good housing. The rise
cf
family
formation
beginning
gently in the early
1960's but
surging

to

'60s

late

by

quire

heights

record

and

early

1970

in

the

'70s will re¬
two million

over

houses per year just to keep

new

with the net family formation

up

not to mention

by fire,

demolitions, losses

abandonments of sub¬

or

standard structures.
the

Allowing for

fact

that'higher per capita
also permit better
houses
to
be
built, the annual
volume of expenditures for nonwill

farm

residential

construction

1970 should be close to and

in

prob¬

ably exceed $25 billion compared
with

$11.9

$13.3

billion

require
the

in

in

billion

1953

and

This

1954.

in

will

corresponding

a

flow

of

increase

savings if financ¬

ing is not to be the limiting fac¬
tor

this expansion in expendi¬

on

for

tures

housing.

Fortunately,
it
appears
that
the savings of American families
be

can

large

enough

finance

to

the necessary increase of produc¬

be alarmed about it.

sometimes hear, that
is

relationship

today's incomes, interest rates,

reached
to

in

considered

types

it.

capital

incomes

confidence.

the

of

25

maturity

are more

all-weather road

an

already

mortgage

ago

be

considering

living

living appreciably by

rocks

out

much
'

mortgage
contract
referred to.

our

have

years

and

in

debt structure is

present
that

that

factor

persons

relative increases in low

same

making

of

remembered

standard of

and

to

case.

do

brackets.

a

throwing

sup-*

ply and demand than is otherwise

than

income

standard of

it

the

for

income

standard of living countries. The
underdeveloped country, with low
average incomes, can improve its

the competition

competes with you

factor

cost

such

in¬

and

a

our

the

Federal Government. When

Uncle
is

of

higher

do,
higher percentage

a

capital demanding than would be

This is admittedly due

extent to

some

of

has

finance

maintenance

in

afford

can

are

been

good thing that we do
higher percentage of our
incomes, because further increases

save

other significant developments in

mortgage

is

always

persons

save

today,

incomes

has

it

brackets

come

was

although

years,

that

over-all

higher
real

real

same

The

is

of

gentlemen dealing
in products other than money are
charging one-half to two-thirds
of

many

rate

because

lower

in

brackets.

chiefly

what

the

persons in

income

one-

generation

a

for

years

also

Today

roughly

two-thirds

now

is

various kinds of

are

is

has

debt

problem.

on

debt

to

were

the

oF

to

tive
in

capacity and our investment
occupied housing.
By

owner

referring to Chart F
that

if

ings

we

rate,

savings,
sonal

as

assume

that
a

is,

can

you

that

the

net

percentage

see
sav¬

personal
of per¬

disposable income wilj. stay
high like it has been

relatively
the

past

should

few

have

years,

$33

then
of

billion

we

net

personal
nance

savings in 1970 to fi¬
our important home build¬

ing program.

Any discussion of future pros¬
for savings would be in¬

pects

to

however, I don't see how we can

complete, I believe, if we did not
for a moment explore the possible

is

"over - save"
are
essential to

because
savings
finance
the purchases of capital goods by
which we provide increases in the

the so-called "built-in stabilizers"

given

debt

have

a

chart

debt

fig¬
of
income—that

percentage

disposable personal
is, income remaining after taxes.
You

need

saving.

ability

same

a

of

rate

of

a

by the character of

contract.

and

years,

nance

influenced by the interest cost of

in 1955.

the increase in family incomes has
been an important factor but im¬

provement

cf

carry

this

in

Noted

by absolute dollar fig¬

Moreover,

level

in 1940 to 57%

ratio

59

to

volume of debt is

but

had

increased

billion

however, about the rapid rise of
this debt, there are several points

ures

time

has

20

jump to conclusions,

we

great reduction in commercial and
some

several

greatly

any

come.

half of which

Some Points to Be

other record being created in 1955,
it is
difficult to anticipate any

to

1945 to

in

billion.

struction and public works is often

considerably greater.
With
high volume of residential

over

credit

consumer

2ty>

biUion

wilk

we

under-saving

rising rather sharply in

1954. Non-farm, non-

started

ship

largest

has been the nonfarm mortgage debt, largely resi¬
dential mortgage debt, which in¬
creased from 27

of line with

re¬

sult of this expansion in housing,

ing by 18 months to two years and
the time lag for industrial con¬

taxpayers, will ultimately

borrowing home

a

sound and active market for resi¬

struction follows residential build¬

longer term
loans, particularly those directly
cr
indirectly subsidized by the
result

because

time home owner¬
considered undesirable
it tended to the people
one

upon

course,

that the trend toward

Federal

was

of

type

financing

Loans

Longer Term
the

ar¬

At

ship

including refrigera¬
closely to a given locality and
tors, stoves, air conditioning units,
prevented
them
from
pursuing
automatic dishwashers, and other
economic
opportunities in other
appliances. The potential effect of communities.
With
active
and

erally speaking, commercial
Danger

financing
is
increased
stability
and salability of residential prop¬
erty.

Mortgage financing

(E)

a

time.

A

In

next

half

rangements

period,

a

turbine

period.

financed

five

over

steam

a

semi¬

a

be

may
or

family's
house is no longer

needs.

investment in

our

truck

box

and

By contrast

four

a

family

1941.

ever,

ment

additional

frozen.

concern

of thousands of educated,

j

other

to

I recognize the fact, how¬
that the precentage has been

personal

obvious that retire¬
and pension programs, cou¬

funds upon pled with our modern methods of
will
broaden
home
of his home without amortizing,
ownership for older families.
I
rewriting the trust deed or mort¬
think unquestionably that home
gage and with a minimum of time,
ownership will be more wide¬
red tape, and
expense. By
this
method a home owner can use spread among all age and income
the equity in his house for mak¬ groups in the future.
Another
important
result
of
ing
additional
home
improve¬
modern
improvements in home
ments, purchasing appliances, or
obtain

to

prior

output to the levels
If have projected for
1970,

which

years.

lum it is very

the security

all

characteristics

borrower

a

chart

has

owners

from 48 to 31-years

past

the other end of the pendu¬

At

is the

"open-end mort¬

gage" which permits

of

exclu¬

by savings and loan

ciations.
call

the

before

of so-called

use

the

is not yet out

Another important innova¬

in mortgage financing

tion

Financing

the

over

increase/our

than

in any year of those shown

was

on

income

other words, measured by propor¬
tion to income, the debt burden

generation.
The
Federal
In
Housing Administration
$1,100 equity in a $10,000 home quotes statistics to the effect that
the spending and savings ability, over a period of five years will the average age of fami-ies buy¬
keep pace with normal ing a new house is now 34 years,
of the over-$5,000 income bracket hardly
families
of
almost
100%
since wear and tear and depreciation, and the Veterans Administration
tells us that last year 37% of all
1941
(again this is in terms of let alone periodic drops in the
veterans buying a house were un¬
constant
general real estate market.
dollars).
der 30 years of age.
leniency

it

personal

the

that

effect

disposable

total

individ¬

lesser percentage of

seriously

run,

American standard of living.
As

long as technological devel¬
and
capital
expansion

opment

continue at their

present
too

volume

high.

present pace, the
of

Indeed,

saving

if

we

is
are

not

to

impact

of

the

growing

use

of

saving3.
The
stabilizing
which have probably
the most direct bearing are social
security, unemployment compen¬
upon

programs

sation, health insurance, and vari¬
ous pension and retirement plans.
To
these
programs
must
be
added still

another, which

was re-

Number 5464... The

Volume 182

Commercial and Financial Chronicle

cently given birth: the guaranteed
annual

is symp¬

Each of these programs

'

tomatic

the

of

craving

for

1

which

of

Deal—some

New

which

security

in

.

x

ing Co. is issuing to the holders of
its
at

were

this

quarters,

some

»

The Yale & Towne Manufactur¬

capital stock rights to subscribe
per share for 106,931 addi¬

$56

tional

good and some of which were illadvised. It should be emphasized
that

•

con¬

tinuing quest for greater security

shares

share for
record

on

at

each

the

six

rate

shares

of

one

of

held

The sub¬

Sept. 9, 1955.

mately 65% of total net sales. Western Europe has led to a
During the five years Products of this division include significant increase in the activi¬
ended
June
30,
1955, approxi¬ a wide variety of electric, gaso¬ ties of the British and German
mately $12,700,000 was spent for line, diesel and propane powered divisions of the company.
property, plant and equipment. industrial lift trucks, hand trucks,
For the six months ended June
During this period, the company and hand-operated and electric30, 1955, net sales amounted to
completed
the
relocation
of
a powered hoists. The standard in¬
$51,122,000 compared with $45,major portion of its lock and dustrial trucks are often equipped
028,000 in the like period of 1954.
hardware business from Stamford, with,
special
attachments,
for Net income for the first

purposes.

Offer Underwritten

some -

envel¬
oped this country in the early
days of the depression, and which
led to the various forms of the
financial

scription offer will expire at 3:30

of

half

Conn.,

to

two
and

in transporting,

plants

new
to
its

loading, lifting,
stacking and storing raw mate¬
rials, semi-finished and finished
products,
machinery and
food¬

in
Salem, Va. In addition, it sub¬
stantially increased its facilities

Tennessee

plant

p.m. (EDT), on Sept. 26, 1955. The for
manufacture
and
sale
of
is regarded as dangerous. Accord¬
offering is being underwritten by materials handling equipment
ing to these views, the American
Morgan
Stanley &
Co. and a through the acquisition of a large
people might foresake the build¬
group of
investment firms who amount of modern machinery and
ing up of great pools of private, will
purchase from the company through
the
expansion
of
its
savings which are essential for,
any unsubscribed shares.
regional sales and factory service
the period of expansion that lies
The company will apply $1,000,ahead.
'
•
:
branches.
:
000 of the proceeds from the sale
*. The introduction of the guaran¬
The company manufactures and
of
the
additional
capital stock
teed annual wage program into
materials
toward reduction
of outstanding sells
handling equip¬
the
automobile industry makes ^
the exploration of this question; bank loans. The balance of prpr ment, locks, builders' hardware,

stuffs
or

which, because of their size

shape,

not

can

in

be handled

standard unit loads. The company
)

is

of

one

of

turers

the

this

Export

.

-

19

business and for general corporate

Yale & Towne Slock

wage.

(1083)

*

largest

manufac¬

type of equipment.

sales

from

the

United

this year was

$2,190,000, equal to
$3.44 per outstanding share com¬
pared with $760,000 or $1.21 per
outstanding share for the first six
months and $1,821,000 or $2.88 per
outstanding share for the full
year 1954. The company has paid
cash dividends in every year since
1899. In 1955 to date, dividends of
50 cents per share were paid on
Jan 3.. and on April 1, and 75

"

particularly timely and isignifi-, ceeds - will • provide
increased
cant. For, no sooner had the GAW
working capital required for the
plan been signed than some of
company's
enlarged volume of
our economic writers and analysts;
,

began

to

say

have

would

a

of total

,1954 net sales, and the company's
•

powdered metal products. In

in

plants

1954, sales of materials handling

equipment accounted for approxi¬

sales. The

share
ofN 75

While there

ings

not

total? net

expanding economy of

Sept. 9 will not be payable
additional

the

on

being offered.

to

likely to have an adverse
upon
the desire of the
people to save.
The

American

social

Government's

Federal

security program, while originally

controversial

extremely

an

pro¬

not—as some financial
executives believed
destroy ef¬
posal, did

—

families

to

for
had, in :
fact, just the opposite effect be¬
cause
the inadequacies of social
security benefits dramatized the
forts

of

provide

their old age. It probably

need

for

ment

retire¬

substantial

more

and

pension

plans

under

private sponsorship.
Unemployment compensation,

controversial proposal, has
any appreciable adverse
reaction on savings, so far as it

again

a

not

had

can

be determined.

The

basic

to me,
is

question involved in
proposition, it seems

whole

this

is whether fear or security
incentive to saving.
basis of the past 20 years,

greater

a

On the

certainly
have

meant

"built-in stabilizers"

of

a

greater ability and

inclination

greater

a

American

the

Just

be made that

case can

a

the so-called

the

in

as

on

people

the part
to

save.

of

case

other-

experiments, time will
the guaranteed an¬

economic

INTERNATIONAL MINERALS & CHEMICAL

whether

tell
nual

is a valid and worth¬
"fringe benefit." Cer¬

wage

while

new

FINANCIAL

CORPORATION

HIGHLIGHTS

tainly it is a milestone in Ameri¬
labor-management
relations
at an industrial level.
Note that

can

1955

I

the

vast

Earnings Per Share

Sales

/

$2.55

Percent of Net

this

that
ated

over

labor

personally

management—free

intervention

government

or

Earnings Distributed as

Dividends Paid Per Common Share

agreement was negoti¬
the bargaining table by

and

.

Year's Earnings

of
Common

con¬

trol.

Dividends

Equity Per Share of Common

.

Stock

....

.....

$1.60

.

$2,207,134

$1,945,757

.

$72,122,015

$69,600,891

$30.99

.....

Working Capital at End of Year

for!

thankful

Ratio of Current Assets to

1955

Butcher & Sherrerd Add
PHILADELPHIA, Pa.
P.

Jr.,

Glendinning,

Sherrerd,
Young

III.

and

now

are

—

Henfy

William

J.

Houston

associated

Butcher & Sherrerd,

D.

with

1500 Walnut

Street, members of the New York
and

Philadelphia-Baltimore Stock

Exchanges,
tatives,

as

the

registered
brokerage

nounced.




.

Expenditures for Capital Additions

.

and Depletion

Drive, Chicago
Corporate
way,

Wacker

20 North

.

.

.

6.4 to 1

$7,219,703

$10,745,566

.

$6,839,593

$4,926,752

$20,000,000

$20,000,000

$9,400,000

$10,050,000

.

Long-Term Debt:
3.65% Subordinated Debentures

.

•

.

.

.

.

6, or to the

Office: 61 Broad¬

New York

$31,191,183

5.8 to 1

.

Annual Depreciation, Amortization,

Offices:

$30.04

$33,196,749

.

Current Liabilities

Annual
Report may be obtained
upon request to the General
of the 1955

6.

3'/4% Term Loan

.

(

Total Net Worth

an¬

Number of Employees

$375,000

.....

.

$500,000

$81,955,015

$79,436,891

12,327

2%% Purchase Money Mortgage

represen¬

firm

.

ANNUAL REPORT
A copy

67.81%
t

$1.60

That, I maintain, is something to
be

$4,098,222

65.09%

.

.....

Retained in the Business

Stockholders'Equity.

$2.44

$4,114,769

.......

Dividends Paid to Stockholders

me

6.46%

of Common Stock Outstanding

June 30

socialism involved in the program.

heartening to

$6,043,979

.

unemployment compensation,
there is not the slightest tinge of
is

$6,321,903
6.55%

Earnings for the Year

Percent Net Earnings to

and

$1,070,000

.

Earnings Before Income Taxes

the fact that unlike social security

$7,113,979

$1,075,000

i

businesses,

Net

$93,591,934

$7,396,903

.

institutions

$96,485,017

.

•

year-around re¬
muneration
has
long been
ac¬
cepted and practiced.
In the great flood of
publicity
which accompanied the signing of
the guaranteed wage agreement,
very little attention was given to

It

Year Ended June 30

.

Net Sales

majority of

financial

American
and

the

of

case

1954

Year Ended June 30

emphasize the words "at an in¬
dustrial level"—for, of course, in

A

record

of

-

inflationary character — it is my
personal belief that this program
effect

.

share

payable Oct. 1 to stockholders of

wage—the most apparent being its

is

1.

ap¬

annual

guaranteed

the

of

per

and

shortcom¬

are some

July

on

cents

England,

15%

proximately

per

dividend

contributed

Canada,

Western Germany

cents

for

save
-

8%

that this program
depressing effect

the eagerness of people
a "rainy day."

upon

and

for

States accounted

11,554

5,046

5,119

shares

'

.

now

,"

-

20

(1084)

The Commercial and Financial
Chronicle

Continued from page 3

By ARTHUR B. WALLACE

The Broad Field of Municipal Bonds

—

be attractive to them.

This Week—Bank Stocks

bonds

are

Higher Interest Rates Spur to Increased Bank Earnings
"Brakes

credit.
.

J/2

Slated

are

Says the "Wall

advanced
to

Credit

on

Further"
to

to

Tighten"

headlines

"Credit

recently
Street Journal," "Interest rates

savings and

loan

associations

percentage point by several of the

Banks

and

articles

on

have

11

been

Federal

Most

held

Brakes

on

tax

funds

raised

Home

.

that the

total

accommodation

Then the discount rate

the

delicate

problem

of

litical aspect.

I

Next

is

Tnere

matters

is

also

income,

ments and interest

if mortgage

income

reports that

17%, is

being

Federal Reserve banks, or the open
matter which is adopted; they will

greater

less intensity

or

possibly

have

a

of trie speculator

-

(

be

stiff,

can

resort

to his

holdings

of

government

other

and

banks.

bonds

to

They

can

increase

a

,

this

season, it is a distinct
will go from 314% to 3y2%,

possibility that the prime

borrowers will be moved up

correspondingly*

age

And if this

name

the

minute

a

in

have

to

and

All

with

tax

get

you

$50,000

a

is

rate

8.60

an

corporate
in

one

will

have

income

tax-free

80%.

taxable

bonds

the

to

in

or

$90,000

get

order

13%%

to

equal
might
tax-exempt se2%%.
Clearly, you

income

realized

curities

such

as

from

or

can't

hope to get 8.60 or 13%%
without, as a rule, a rather subrisk of capital.
On the
hand, you can get a very
high-grade tak-exempt security
today at a 2%% rale, so that peoother

pie

that, and even, in fact, at lower
brackets, can well afford seriously

And

such

a

rate

314% would probably
So

the

banks

is not

come

will

be

high.

In most European countries.
heading of easy money.

the

under

rise

in First National

a rash

,

City's annual

by

rate

t

,

'

to $2.60.

■

such

bonds

balancing

a

Municipal

Borrowing Must
According to Law

\

gen-

authority to borrow is a
important factor in connec-

different category from
corpoate
issues because most corporations
.under the.law have

to borrow.

The

the

authority

states and muni-

cipalities must borrow strictly in
accordance with

the provisions of

law—it may be state
constitution,
it may be state legislation or it
.may

.be their,

and it

own

they do not do

so,

not vaild, they
l'orceable, ancl can
are

null

and

void

in

the bonds

are

be

the

not

en-

declared

event

of

a

taxpayer's suit. That is the reason,
if

have

you

municipal

occasion

secuirties

to
at

deal

all,

in

you

will realibe that it is
very
tant to
get an

imporlegal
attorneys who

STOCKS

INDIA, LIMITED
Bankers

Kenya
Head

Members New York Stock
Members American Stock
120

Exchange
Exchange

BROADWAY, NEW YORK 5, N. Y.
Telephone: BArclay 7-3500
Bell

Teletype—NY 1-1248-49

(L. A. Glbbs,

Manager Trading Dept.)
Specialists in Bank Stocks




to

the

Colony

Office:

and only
opinions are acceptable in
the trade—those
attorneys or legal

firms

Government in
and Uganda

26

St.

Bishopsgate,

End

James's

Uganda, Zanzibar, and Somaliland Protectorate.
Authorized Capital
£4,562,500

Paid-Up
Reserve

Capital—
Fund

£2,851,562
£3,104,687
description of
exchange business.

The Bank conducts
every

banking

and

Trusteeships and Executorships
also

undertaken

that

are

recognized

*

types

of

great variety
are obligations

a

some

names,

municipal units.

or

rather

some

amusing
I remember one

titles.

or

care-

municipal;
well;

some

remember very

that

faced, for

example.

and

others

Westchester
White

that

We:

Plains

were

up.

against it from the standpoint of
meeting all of their current obli¬
gations including pay rolls. These
municipalities are the tax-collect¬
ing agents and the county has the
first claim
for

cities

at

their tax collections

on

its share of the taxes.

These

decided, however, to with¬
taxes

the

due

the
we

county

received

as

a

call

a

bank

from the county of¬
They had some obligations
coming along to be met and they

ficials.

I

not

am

going to get into the

field

of " Revenue

think

we

bonds

but

I

properly expect a
continued growth in the field of
district or authority obligations,
may

to

ance

have

to

do

short-term

some

We said, "What assur¬
have you that you are going
this

the

sonable

tome

Actually the

wasn't

surance

from

in

money

the loan"?

pay

satisfactory

very

standpoint

to
as¬

of

any

rea¬

bank

approach and we
had to work out an arrangement,
which
involved
special
studies
ing with our metropolitan area
Finally
problems. There are many ques- and special legislation.
we
tions in connection with municigot acceptable assurance that
pal finance that are interesting we would ultimately be paid and
that
that I won't have time to "go into
proper
pressure
would be
here, but one is the subject of placed on the municipalities to
home rule. A great many of ourj collect taxes and pay over to the
municipalities very properly are county.
One field that I think is quite certain to expand is the field deal-

jealous of their

own

it

great

has

been

a

authority and

mistake,

on

occasion, where slates have attempted to step in and assert too
much

authority over the control of
municipal units. Wo
in Illinois, and we find

of their

some

find

that

it in

New York State.

City

has

to

to

go

New York

Albany

many

That

was

new

a

experience for

Westchester

County as never be¬
fore
had
the
county
worried
about
the
question of whether
taxes were going to be collected
on a basis of 90% or 80% or what¬
it might be.

ever

They

were gen¬

and nobody thought
it, but those things
when we have a serious

erally

paid

much

about

times to get

authority to do things
they ought to be able to de-

change

that

change in the economy.

cide

on

their

have the
0f

In Illinois

own.

problem.

same

Chicago has felt

abused

because

they
The City
greatly

very

the

farm

group

Financial Questions

The

Now, the financial questions—I
am
hurrying
over
these
very

and southern part of the state has

speedily—there is the question of

asserted

debt, of course, in relation to tax¬
able values and when we say debt

itself

has

not

the

in

been

legislature

sympathetic to

we

more we are coming

metropolitan
urban

died

that there

areas

problems that

on

a

can

be han-

broader basis than

purely municipal
particularly true

are

on

a

basis.
That is
in connection

with transportation, sewage disposal and water supply and things
of

that

that

kind
will

and

I

would

guess

growing
dency in that direction,
we

see

ten-

a

think

debt

overlapping debt as well. There
is a great variance as we review
different
municipalities. In
the
case of New York
City you have
practically no overlapping general
debt except state debt. In the case
of Chicago, on the other hand, you
have a lot of overlapping
debt.
You have the

Pressure

Forest

in Connection
With Municipal Bonds

County,

not

nomic

and

trend

of

social

those

factors

factors.

and

the

What

is

the type of the community?

What

is the type of population?

you

you

District and the
District of Cook:

have

District—I

Park

going to take time to
say a great deal on the question
of the character of municipal securities
because
that
subject is
so big I don't knew how we could
begin to cover it in any appropriate way. I*am just going to speak
very quickly about some
of the
things that we look at.
We, of course, consider the ecoam

City of Chicago, you

have 1he Board of Education,

have the Sanitary

Considerations
I

only of the direct
municipality but the

not

the

of

the

think

Chicago
there

are

unless you add
them up and don't get a fair pic¬
ture of the true debt burden be¬
six altogether and

cause

all of those units of govern¬

ment have the
and

to

right to levy taxes
taxes
in
that

collect

particular area. The total debt of
all these units is the real debt
burden that is nlaced on the area..

Now, it can be a very difficult
thing to attempt to collect all of;
those figures and
put them to¬

gether in order to get an accurate

What

picture. Usually bond circulars
give some indication — they
will frequently say that "This does
not include overlapping debt" or
percentage of colored?
What is sometimes will indicate what the
they, very properly, may have the the
type of industry?
Is it de- overlapping debt is. In the old
highest respect and regard. That, pendent
pretty much on one type days we had to go to a great deal
attorney may be a very well- of industry or are the business ac- of trouble to try and line up that
qualified man in ordinary law, but tivities
pretty well diversified? type of debt information. Some¬
this is a very specialized field
and
What is the debt record and what times these other units from whom
his opinion is not acceptable until is
the
general
position toward information is sought, that have no
as

au-

thorities in this field.
Frequently
we have to deal
with the
subject
of local communities
wanting to
use
a
local attorney for whom

London, E. C. 2.
(London)
Branch:
Square, S. W. 1.
Branches in India,
Pakistan, Ceylon,
Burma, Aden, Kenya, Tanganyika,
West

13,

Laird, Bissell & Meeds

opinion. There are
specialize in that field
their

of

and

and

have

local charters—

acceptable

INSURANCE

other

have to check rather

we

More and

a

.

BANK

certain
There is

the meeds of the city.

Be

tion with public issues. Slate and
•municipal- securities are in quite

23%.

NATIONAL

a

to realize in connection with these

ingly, the 10-year dividend total for the bank should have
appeared
as $147.50 (not
$53.33), while the gain to the shareholder in
equity
and dividends on Dec.
31, 1954, as against Dec. 31; 1944 was
54%

BANK

them

and

The
very

a

issue of Sept. 1 (page 17)

as

security feature in their
eral portfolio.

It-is not at all

concerned the growth in book value, etc., .for the ten years 19442954 of the stocks
of various New York City banks and banks
outside New York City.
Regrettably, the data in the case of the
United States Trust Co., New York City, were incorrect. Accord¬

not

very

some

prediction to expect other increases by the year-end.

CORRECTIONy^The article in the

may

and

certain

beneficiaries ,of these develop¬
ments, to the betterment of earnings, with dividend
increases to
lollow. Indeed, that is the net effect of
Chemical Corn Exchange
Bank's 10% stock dividend, the news of which
was followed

tax-exempt securities.
wisely purchase

They

percent¬

a

investment

excess

in any such bracket

are

to consider

takes, place rates for lesser
The !4 of

have

as

have

newal.

who

funds and

for

point does not bulk large, except to the
lending bank that may
outstanding loans into a billion or two that will need re¬

of

you

in effect, that an inthe
$50,000 bracket

from

be

to

rate

relatively popular
district, but there has
prejudice from time to

of
a

income, the tax rate is
If the bracket is at the level

bracket

additions to their loan portfolios, and at rates that have been firming. If the normal demand for loan accommodation
develops at

(

form

on

Tax Exemption

person

$90,000,

a

reduce

funds

some

that has been

County

wanted

taxable

to

Telephone converts is going forward at this
time,
the margins being far below that
required at a brokerage house.
on new security purchases.
to the benefit of the

and

obligation,

borrow

borowing.

stocks

new

Ail this inures

Yonkers

time

individuals.

income

braking effect of

Indeed, borrowing at the banks

had

district

I

problem

Rubbish Collection District,

will

curtailed, while "legitimate" borrowers

bank.

most

common

nonpayment of

couldn't

of

case

or two—the Mosquito Abatement
District and the Garbage and

of

case

dividual

will have ready access to the credit reservoir. We
are all familiar
with the fact that a speculator who considers the
70% margin too
carry the

;

will

the

the

been

take just

us

That means,

ordered that the activities

so

in

situations.

result of which

of

the

were

banks, to borrow,
indirectly from the municipalities
by not paying their taxes. We had
a
pretty acute and real problem

this form is common, not only in
state and municipal issues, but in
various district issues as well. The

that

stantial

In other words, things cannot be

j

ever

they

and

hold

68%.

bank

all

an

expanding field of purposes of issue today. The ordinary form of
bond is a general obligation and

York

taxable

all demands for credit.

on

relatively

few purposes but we have

taxes,

municipalities

instance

requirements, upping
borrowings at the
market operations, it does not
to

to

fully. Many of these districts are
overlapping in respect to other

Value

on

because

from their local

limited

were

of

have to do is look at your income
tax
report form to know what
those rates are. When you
get up
in the higher
brackets, lake for

reserve

applicable

not too severe for

bonds

we

strikes

they knew that the penalties

the

channeled

increasing

part of some individuals,

broadening
purposes
oi
borrowing today are quite interesting. In the old days municipal

New

in

tax

were

disposition

was a

that

Now, let

po¬

methods available to the
money authorities

opinion,

The

we

But in the :30s

that there

to look at the value of tax
exemption translated to real
figures in

mortgaged; and, of course, everything else being
equal, the greater this figure becomes, the harder will rates be.
Of the several

half

invested

_

servicing is

check this growth in debt,
the Reserve discount rate

York

about

is

the other taxes.

districts.

The

be

to

just

were

and there

Jt will be marketable

1930s

of taxes.
It was gen¬
acecpted that two things
certain, one was death and

found

to whether

as

the

until

funds.

these accounts; and this figure rises to
22%
included. This is a high proportion of

on

high rate in the
incomes. I should

by those funds—that is their
retirement funds and their sinking

substantial portion of all
into instalment pay¬

a

collec¬

payment

determining factor

probably, is the school district and

of

The Federal 'Reserve

personal

tax

on

much attention to the

held

a

strictions taken to date have not
accomplished much; and
this fits in with the desires of the "ins."

ancl

know,
gave

City bonds. This means that about
$1% billion of such bonds are

major election year, and it will not
do for the "ins" to have the brakes
applied too strongly. They
hope to have the economy remain in high gear. The credit re¬
year

are

very

New

on

that

from

the

a

of

amount

deflation, they

keeping

individuals

to

individuals

but

high

You
never

erally

particular field.
Willingness
the part of the larger dealers

City, for instance, that their total debt is
something over $3V2 billion and

But this is going to be difficult to do.
First, although the
authorities appear now to be more concerned over the
possibility
of renewed inflation, what with the current edition of
wage hike's,
than they are over the prospects of

with

value

The

many

apply the brakes.

faced

of

case

higher level

But the real surge of business
activity comes, usually, after
Labor Day. This year activity has been at a
rising pace, so that
if the normal upswing in the fall months
develops we are likely
to experience a real
money,-or credit, stringency.
It will be re¬
called that the Federal Reserve Board
reported that instalment
debt by consumers rose in
July for the sixth, consecutive month to
a new high; that automobile instalment
buying was at a new peak.
It is thus easy to understand that the
monetary authorities want to

breaking out strongly in either direction.

per-

tax-exempts are held
by municipalities, or public funds,
state funds, etc.
We know in the

paper.

are

are

individuals.

or

52%

how

in all of the Federal Reserve Districts. And
finally, there
issue of 91-day Treasury bills at a rate
higher tnan any
in the past two years,
2.134%, a truly high rate on a three montns'

material

bonds

just make passing comment about
public funds. We don't know just

new

any

of

taxable at

of 21/4 %

is the

other

by public funds,

exempt

case

corresponding 1954 date.

made uniform at the

the

trusts

rate

by these banks is at $8,399 billion,

was

is the record

banks to accept that opinion is the

a very distinct one.
Of course,
corporations are taxable at the

Loan

.

and that it is about $1.2 billion above the

be in the

apt to

is

%

And, on Sept. 2, "Loans to business by leading
New York City banks rose $44 million in the week
ended Wed¬
nesday" [Aug. 31]—the sixth straight increase. We read further
.

of

either

sonal

bank

on

more

Today such

issues.

revenue

Tightened

what
tions?

Bank and Insurance Stocks
=

Thursday, September 15,1955

...

he

has

he

has

ground

established
had

and

a

the

fact

that

fairly broad backexperience

in

this

percentage—for instance? In some
of the southern towns, what is the
percentage of white, what is the

will

debt

particular

times

and

of

toward
stress

paying debt in
difficulty?

and

What is the taxpaying ability and

ing
very

interest in the financ¬
in contemplation, will pay
little attention to a mail

Volume 182

Number 5464

The Commercial and Financial Chronicle

...

21

(lop)
request.
&

Today, fortunately, Dun

Bradstreet

service

that

have

municipal

a

by the bank examiners and while
we

bound by the ratings
agencies may provide,
have got to be aware of them.

that

in

much

connection

credit

it

and

with

has

municipal
the

made

busi¬

from the

ness,

alysis,

standpoint of
much easier for

very

trade

as

We

whole.

a

the

:

interested

are

an¬

also

in

debt

we

I

some

reasonable

of

peaks

basis

or

years

over

that,

in

the

when

markets

period

a

there

are

They

provide a very
study which

detailed

more

those of

who

us

interested

are

in

knowing more of the facts find
extremely valuable and helpful.
Not only do the dealers subscribe
to

that

service

broadly, but

very

of

.

We

&

interested

are

in

the

debt

is

that

general relationship

in percentage?

ciate

present

editor

of

post

asso¬

as

"Financial

World

Magazine" and author of its col¬
umn

"Business
nampd

Background,"

has

editor of the Ameri¬

Stock Exchange's forthcoming

financial

Whitney Co. Inc.

refunding
might be difficult, might be hard

What

his

to

rose

Corporation,

was

a

Federated Sees. Add

re¬

New

Sports

York

"Evening World,"

Editor

"Herald

of

the

Salt

Republican,"

writer

for

"Herald"

the

and

Lake

feature
Angeles

Los

correspondent

for

WASHINGTON, D. C.—Whitney
Company, Inc. is engaging in

a

at

H.

securities
806

from

business

15th street, N.

Mitchell

is

W.

offices

President. Mr. McConnell will
the

Trinity

Francis

principal of the

a

magazine, according to
an
announcement today by
Ed¬
ward
T.
McCormick, Exchange

Place

Oct. 1.
Born

firm.

Market

'

in

join

George

Muller

B,

of

Federated

for

umns

"Wall

the

Street

Associated
Journal"

and

On

New

Oct.

1

"Sun," directed the Public
Relations
Publicity Department

member

for Doremus &

partnership

York

Co., and

was

vice-

president of Albert Frank-Guenther Law.
He is
The

men's

a

of

the

already

spoken

enforceability

the

New

be

We

which

tions

and

member of the

Silurians,

a

Society

newspaper

organization.

Stock

has

Exchange.

been

floor

active

broker.

back

10

tate

payment of obliga¬

operating
20

or

tax

frequent

a

that

least

at

costs.

Going
the real es¬
important

years,

was

very

source' of revenue.

for

v

col¬

or

it

It

90%

of

in¬

not

was

responsible

was

the

revenues

received

by municipal units and,
course,
in
connection
with

of

units, especially districts it
Many districts have little

many

still

is.

access

to

unless

it

other

The

grants.

it

as

still

and

carefully.

is

not

be

to

state

tax

to

real

important

an

that

one

It

used

through

power

is

property
factor

be

income

of

sources

may

watch

we

important

as

because

munici¬

palities generally have

expanded

their

It

income

sources.

particularly important in

is

not

connec¬

tion with state obligations because

they have
taxation

much wider

a

it

and

is

avenue

of

much

very

easier

for them to get additional
taxing authority, frequently, than

is

the

with

case

units

local

which

government,

of

be de¬
pendent upon state legislation or
•other
changes.
Therefore
you
should

hear

may

something about tax

limits.

Now, there are tax limits that
apply to operating costs and tax
limits that apply to over-all costs,
including
debt
service.
Where
such
it

limits

is

apply to debt service
municipal cir¬
indicate by language,

customary in

culars to

so

usually under the debt statement,
"•'There
taxes

bonds

within

from

payable

are

the

limitations

pre¬

scribed

by law." That is notice
that you ought to explore as to
what the significance of that state¬
ment

is. In

some

there is

cases

an

ample

margin,
in
other
cases
there is a relatively small margin

and

that

needs to

considered.

be

studied

and

have

I

already men¬
tioned legal opinions and we de¬
pend upon those legal, opinions

for

assurance

that

have

we

This is Apota. The name is a contraction

valid

of Automatic Positioning of Telemetering Antenna.

and enforceable obligations.
The

question of ratings ought to
think, very briefly com¬
mented
upon.
Prior to the '30s
there was a great lack of accuracy
in ratings and they were subject
to very serious criticisms. I think
it is only fair to say that they
learned a good deal and I think
a
good many of the rest of us
did as to what can happen in con¬
nection
with
municipal
credits
and it is my feeling today that
they are doing a very commend¬
able and very difficult job in a
helpful manner. There was quite

be,

a

I

while

when

particularly

ings
their
take
must

if

the

smile

they
too

recognize

convenient

agree

and

form

people who know

of

it

is

rat¬

with
didn't

we

seriously,
that

didn't

the

upon

didn't

conclusions
them

trade

but
a

we

very

checking by
little about

very

municipal credits. It is used




even

It Takes
This mysterious

Messages from Guided Missiles in Flight
So

object is Apota.

If it sounds and looks like

earth.

thing from Mars, there is good
reason.

For what

receive messages

Apota does is

in

out

—'

space.

When

a

that

to

from far

missile is

in

send

'

back data

radio

a

to

the

Apota is the giant antenna

automatically tracks the missile

flight and picks

messages.

_

launched, the

they equip it with

that will

some¬

It's

an

up

these radio

*
,

Telephone Laboratories direct work
the development of atomic

on

| i: weapons for the armed forces.
This is

just

one

designed by

on

the

know what is
there

on

its

ground

happening

flight.

want to
way up

the Sandia

Corporation,

a

govern¬

ment's request.
*

Bell

System subsidiary in New Mexico.1
There Western Electric and Bell

_

many

major defense projects undertaken

,

observers

of the

by the Bell System at the

„

instrument

ta

Williams

Co., 15 Broad Street, New York

from

source

is received

money

lected for the

Stock

City, members of the New York

interested in the power to

are

tax because that is the

S.

,

McCooey,

York

admitted

in Blair

about

obligations,

of

J.

will

Exchange,
&

Herbert

Obligations
have

"

,

Blair Williams to Admit

Press,

Enforceability of Municipal
I

C.

Corpora¬
National
Bank

tion,
Louisiana
Building.

Then, also, there is the question
of
operating experience. Has it
been customary to balance their
budget or are they frequently runrung deficits?

,

Cleo

Securities

•

t-

and

Yarbrough have joined the staff

by-lined business and market col¬

of

Denver, Colo., Mr. Mc¬

ROUGE, La.—John L.
C.
J.
Chaddick,

the San Francisco "Chronicle." He

on

.

BATON

,

Barrilleaux,

porter for the New York "Times"
and

T

(Special to The Financial Chronicle)

-

the

service in relation to total income.

H.

McConnell, veteran
newspaper
and magazine writer
and
editor,
whose
publishing
career began
as a 25-cent a col¬
umn typesetter 35 years
ago, and

can

bad

to deal with?

Frank

been

helpful.

maturity

event

Finance

have already referred to Dun &

Bradstreet.

retirement programs. How is the th
larger investment institutions
debt retirement schedule? Is it
on, also use it and find it extremely
a

Connell, who served the Urfited
States Department
of, State, War
Department
and
Reconstruction

not

are

supplies
that type of information. They do
an excellent
job in collecting and
presenting most of the vital data

pretty well

BELL TELEPHONE

SYSTEM

as

MJr.
an

McCooey
individual

count rate

What would be^the party

worker's answer to a query
policy and its reconciliation with
the general statement about not doing for the citizen what
from

\'As We See It
making ourselves an agency to help the United
States of America. It is merely another form of gaining
distinction for ourselves, to get ourselves a pat on the
back, and to appear important." Then continuing, the

reconcile the so-called full

to

seems

here is

me

government.
"'For the people': We have seen the phrase tortured
by demogogic types to mean that an overwise and overbusy governmental bureaucracy takes over all the func¬
tions of living. They say 'now
go on, boys, do just what
you are told and we will take care of the 165,000,000
people.' And they tortured the general welfare clause of
.

and time.,

Continued

future.

the

by 'for the
people.' But I refer to another quotation of Lincoln's
which was generally to this effect: the function of
govern¬
ment is to do for the
people what the individual cannot
do at all, or do so well for himself, and in all those
things
which the individual can do for himself, the
government
ought not to interfere.
we

which

we can

not

with

to

the

been

Billions

Third

quarter

Quarter

Without

the

inventories
this

monopoly

on

And

they

point to

can

the

of

by

ness

have been

so

Of

V

look

display the
course

with

same

fervor for the

neither Lincoln

approval

nor

New Deal introduced into

a
our

v

at

for himself when
both parties is a

a

a

record

had

fallen

a

Free
reserves

Federal

citizen what he

one

of

the vote

can

any man

gigantic social security

in making his
are on




rate.
was

program

own

never

been

to

a

of

rate

and

2%

indication

not

by

any

The Federal Re¬

authorities, genuinely be¬
lieving in the efficacy of a flex¬
ible

policy, will adopt it, continu¬
policy of restraint, in our
opinion, until business expansion
shows signs of slowing down. This
ing

definite

a

could take

into the winter be¬

us

fore leading to relinquishment of

tight credit policies.
One way of

that

looking at the prob¬
Federal

the

icy Works, as we
new
heights in

.

is

rate

ceiling.

a

an

serve

Reserve

System faces is this: Allowing the
boom

into

continue

to

will

1956

.

or

down

will help to

now

maintain a
if the pol¬
believe it will,
production and

balanced economy and

re-

How are prices behaving;
there sharp advances in basic
seem

violent readjustment
recession later on; a slowing

mean a more

Gross

in

later

on

will

Product

National

scaled

to

in

be

healthier

a

en¬

vironment.
For

Is

less

than

taken

of

to

retard

credit.

In

the

recent

New

who

those

economic

Reserve

and

allowing

politicallypolicy cer¬

are

second

for

have

a

satisfaction.

braved

both

Federal

of

the

is

which

Federal

and Treas¬

Reserve

As

stated in

was

our

June "Eco¬

Interpretations," the long¬
implications are favor¬

term

er

able:

ma-

No*body

thinking in terms of deflation.

nomic

be

"The pattern

for

would seem to
authorities

credit

the

permit

either

credit

additional

sion

at

levels

consumer

to

expan¬
or

busi¬

seasonal re¬
quirements to effect a further ad¬
ness

of

vance

money

in

beyond

interest

The

rates.

could

market

tighten

gradually so as not to disturb
Treasury financing.
This would
the
dual
consequence
of

have

Svstem

a boom atmosphere and
policy makers in a
position to turn around definitely

modifying

also place the

authori-

and

supply funds if waning ten¬
in
produuetion develop
later on, if need be by another
cut in reserve requirements."

ties and has restored faith in the
use
of traditional measures
of
flexible central bank policy after

dencies

of disuse or the prevalence
policy frozen in the direction
of easy money.
Because of the
momentum of the boom, we would
years

of

a

Joins Palmer,
BOSTON,

Free

Reserve Banks

Reserves

Pollacchi

(Special to The Financial Chronicle)

DeWolfe is

from Federal

Excess
1933

the

over

basis for whole economy.

episode with
It is fresh in

credit

concerned

circles. A two way policy, if
it means anything, involves let¬
downs as well as expansion, in the
long run leading to a sounder

1953-1954

minds

the

Reserve

approaches.
the financial

years,

was

ury

Borrowings

of

many

consistently inflationary trends in

news-

measure

the

national election

a

For

world

phraseology, there are
many features in which the current economic situation resembles
Mr. Sproul's catalogue,

great

motor, the Federal

authorities

as

be

rhetorical

the

in 1953-54 in first
putting on
the brakes and then
feeding gas to

.

market,
which in recent months has not
fitted
Mr.
Sproul's
description,

The

agreements in imindustries
endangered

to

seem

a
.

stock

views

cess

the

the

excess

(see table).

of
.

instead of staying where it
belongs as a necessary adjunct of

weeks

All of this spelled
Encouraged by their sue-

strain.

consumer

Excluding

expan-

price stability.

a

the

needs

financial and investment
chinery?"

due in

wage

portant

the

economy?

our

banks—declined

was

beyond

delivery

paper,

reserves, that
is, excess
minus borrowings from

although this

reserves

never

Reserves

Mass. —William

now

E.

with Palmer Pol¬

lacchi & Co., 84 State

Street.

(Millions)

^ January

,

$682
February ~_.___.l_—625

,

March

.

'

April

♦>,

590

May
i

590

June

ligitimate living, when the

501

July

(est.)

600

$369

354

" '

585

■»'

$313

-

t,

*

interfere with

the statute books of the nation?

clear

no

and the front pages of the

also

part to the steps that had already

lives,

programs

Al-

level, personal savings

Reserve

average

much better do

catching

party and their President would

securities acts

annual

sharply from the $625 million 1954

sion

political worker with

are

the

means

liberal mortgage terms, originally
abetted
by
a
monetary
policy
dedicated to easy money? Is the
stock market getting into the taxicab, the elevator, the barber shop

a

billion

they seriously contend that

-

reaching

annually,
compared
with $21 billion as recently as the
first quarter of 1954.

undertakes to provide out of
public funds for the old age
of individuals?
How could
their

was

Construction had reached

$17

sedulously

cratic, say that his party and his President would

doing for

Product

though disposable income

mind whether Republican or Demo-

think of

a

billion

ever

How could

never

$42

a

continued in effect.

that

on

as

lem

Does

government

of 1954.

as

straight face,

April

showing
signs
of
going
on
a
credit spree, stimulated by increasing injections of instalment
credit? Is the construction industry wearing out the effects of very

billion annual level against
$358 billion in the second quarter

great many things that the
our

last

address

be regarded

tainly would be more in keeping
with the Administration's wishes,

$385

Republican party
things.

public policies, and

his

may

This

banks.

Reserve

several

at

Means Business

The

prompt

National

same

and which the Eisenhower Administration
has

.

a,n

.

mulation

borrowings have exceeded
upon

.

.

„

minded,

security issues
high level. Corporation issues for new capital were
showing a tendency to rise. Gross

nearly the

Jefferson would

favor

there evidence of inventory accu-

local

as theirs in former
years that they are more or less
estopped from criticism of it. One may well ask what the

workers

,

be out of line with increases
production and consumption?

January-June period, and
the
expansion
has
continued.
Mortgage lending and State and

same

results would be if both Democratic and

chances

the

believe

lifting of the discount rate to
2V4% generally, the current rate

of 1955 expanded a record amount

people to whom the President
is addressing these fine
phrases are said to be chiefly
concerned by the fact that the
Republican policies and
years

We

for the

or as inadequately, exemplifies these principles as
the President's lieutenants. The fact is that the
Demo¬
cratic counterparts of these

of the past few

lf

commodity prices which

"Bulletin."

Reserve

more

now

are

frequent changes in

use

Bank loans in the first six months

can

programs

«

are

exam-

the

the discount rate.

covery.

ination of credit and money in the

Republi¬

about

Reserve

comprehensive

a

July Federal

such fine words. Their

which

30, 1955.

too

that

a

.

in the 12

Federal

authorities

credit

ready to

used

appears

actions to the sweet music of

and

consumer

and of $3.8 billion

Notice

fully,
•

—

It

frequently.

Among the trends that give a
lead to credit policy in a recovery period, Mr. Sproul noted
"There is appearance or non-appearance of speculative tendencies
in business plans, in consumer
buying, and in public or mass re-

in

System's concern over credit expansion had been served on busi-

.

record

a

in

months ended June

opponents may prefer to quote Jefferson rather than
Lincoln, but they can come up with about the same senti¬
ment.

gain

not be

should

and

ures

t° h°ld fire.-

was reason

continue

rise

a

continued at

no

being initiated by the Federal
banks, it lacks the dra¬
quality of changes in the
discount
rate, which the public
comprehends
more
readily.
Changes in reserve requirements
are more sweeping overall meas¬
Reserve

policy of "active"

a

For

There

material

will

despite

1955

...

workers have

While

borrow.

to

of

trigger points which will tell you
exactly when to shoot and when

1.5
-f 4.3

+

doubt, there

believe

to

going right on down through—it is all in
vain.
So the object in the
organization of a political
party comes down to: How can I get to the last man living
in my block, my
apartment house? How can I get to him?
Well, if you can get to him with your conviction, with
your belief, with your fervor, with the leadership that you
have exhibited by
getting where you are today in the
organization you can win any election in the country."

can

.6

...

First Quarter
Second Quarter

is

.

4.9

1955

take the fervor that you have, and
carry it back to your state, and conduct the same effective
campaign schools there—make sure that the spirit and

.

z.t
—

„

credit, mainly in automobiles, of
$2.5 billion since the beginning of

of them—is that these

banks

open-market policy has the merit

President of the Federal Reserve
gank of New York, stated "There
are nQ specific criteria which can
guide the policies of the Federal
Reserve
System
at
all
times.

n

$3.2

Fourth Quarter

I

The Trouble Is

member

"Monetary Policy in Periods of
Transition," Mr. Allan Sproul,

~

"Unless you can

one

by not adding to the

government portfolio during the
period of seasonal expansion suf¬
ficiently to reduce the need of the

restraint.

In

Fust Quarter

make others understand."

The trouble—or

criticism by

follows:

as

1954

having labeled Republican plans and programs
admirable
generality which, unfortunately,
many things to many people, the President turns
state chairmen who waited
upon him recently in

know-how

sufficient

not

was

only understand, but

Denver with these words:

of restraint

•

change in business inventories has

this

means

14

page

prevent a sizable gain in inventories. According to the latest
available data, the rate of annual

And

>

from

consumer

becond

us

is justified by credit conditions.
Open-market policy in the near
future would support the policy

"t,.

to

mean

"Now, I think today that is as good a presentation of
the Republican case as I know how to make. It
puts it in
terms and words that all of

position as a weapon of
policy, with changes being in¬
tended as a signal to the entire
business
community that either
caution
or
a
"go ahead" spirit

Policy—
Flexibility Is the Word!

,

"We could discuss further what

its

it may be restored to

or

earlier

Federal Reserve

...

our

tions

If

people, which means for the individual as
such, we go first to the 10 first amendments of the Constition, the Bill of Rights.
That Bill of Rights does not
guarantee to each of us a profitable living. It guarantees
to each of us an equal opportunity with all others to earn
our
living for ourselves and for our families, and to pro¬
tect

mirror of money market condi¬

a

only the President's fine words could somehow
find a realistic counterpart in the everyday facts of politi¬
cal life in this country!

for the

are

re¬

matic

"I don't believe that is what Lincoln meant at all.
we

employment act with the fine
protectionism of

What about the

If

the Constitution.

credit

toward

moves

The discount rate can be either

parties at this time? And what about the extremely
discriminatory income tax laws which have become one
of the cardinal planks in both political parties?
And what
answers could the Republican party workers give which
would not be equally available to the Democratic party
workers? These are questions which are not only diffi¬
cult to answer, but impossible to answer in a way to be
of real service to either of the political parties of this day

by 'for the people'?

mean

Cleveland Federal
mark the end

the

straint.

both

of the tall riddles of free

one

in

the

of

How would he

and should do for himself?

can

words of the President?

President had this to offer to his party:

"Now, what did he (Lincoln)

(2V4%

Reserve District) to

voter about farm

a

the citizen

not

"It

expect the lifting of the dis¬
early this month to 2%

not

Can Not Be Reconciled

Continued from first page

we are

Thursday, September 15,1955

The Commercial and Financial Chronicle....

(1086)

n

464

121

-

495

*
.

t
-

•

490

\

-

-

255
.

-

-

65

110

Barrett Herrick Adds
(Special to The Financial Chronicle)

-

95

335
436

,

271

J.
-

■

,

SPRINGFIELD, Mass.—Edward
Schell

is

now

Barrett Herrick &

affiliated

with

Co., Inc., Third

National Bank Building.

...

.

Volume 182

Number 5464... The Commercial and Financial Chronicle

(108*7)

liquidating committee for dis¬
posing of liabilities, reserves and
taxes not assumed by Howard or
a

News About Banks

-j

*

*

*

Bankers

and

OFFICERS, ETC.

CAPITALIZATIONS

Pleasantville, N. J., with common

capital
stock
of
$100,000,
was
placed in liquidation on Aug. 26,
its
business having
been taken
over

John

P.

Billhardt, First VicePresident and Comptroller of the

Co.
of

of

Hartford,

Columbia

&

Director

Renssalaer

Tele¬

of that date

as

National

walk

Conn.,

The
of

*

National

Merchants

Pa.

Allentown,

official

Bank

the

announces

26

at

erate leases which it is announced

Friday, Aug.
and Saturday,
Aug. 27 from 10 a.m. to 3 p.m. of

will

its

new

The Union Dime

Savings Bank

of New York has closed

two sep-

insure

uninterrupted mainoffice banking operations at its
50-year-old location on Sixth Ave¬
nue, between 40th and 41st Streets,
it

announced

was

Sept. 13 by J.
President pf the

Wilbur
bank.
has

John

P.

In

on

Lewis,
one transaction, the bank

taken

for

short

term, the
floor, mezza¬

a

basement, ground
nine, and second floor in the 12story building at the southwest

Billhardt

7

opening
to

9

Jordan

branch

Park, Pa. Branch
the

of

new

from

Monday
to
to 3 p.m.
while the hours on Friday
are
from 9:30 a.m. to 3 p.m. and from
are

Thursday from 9:30

6:30

to

8

p.m.

a.m.

at night. The new

branch, of which George Reinert
is Manager, offers every banking
service.

Mr.

Reinert

the Merchants in

with

started

1917,

as

bank

a

York at 221 West 57th Street, has
been elected a trustee of the
bank,

Street, next door tq, its present lo¬

and advanced through
various posts to the trust depart¬

cation

at

Sept.

19, Total dividends in
through the third quarter

1955

will it is said amount to
#

it

Sixth

Avenue

Savings

Bank,

announced

was

by

of

New

Francis

S.

Sixth

Avenue

the northwest

and

of

corner

40th

and

41st

messenger,

❖

Street.

I

Bank

National

The

&

S:

quarters

while

:!«

its

reported

v.

$100,000 in the
Franklin National
Ohio, brought

of

of the

of

The National Bank of Washing¬

headquarters

on
its present site
being readied in the 30-story
sales staff at Bankers Trust Com¬ office building to be erected. The
pany,
of
New
York
has
been new building will bear the address
elected an Assistant Vice-Presi¬ 111 West 40th Street. According to
dent and has been transferred to Mr. Lewis, the bank will move
the Far West Group of the Bank's into its temporary quarters in the

tn, D. C., is offering its stockhold¬

are

ers

G.

Seaver

member

Jones,

of

the

since

1939

municipal

a

bond

Out-of-Town

Division, it was an¬
nounced on Sept. 12 by S. Sloan
Colt, President. Mr. Jones began
his business
Oil

career

Company

of

with Standard

New

Jersey. In
with
the

his

new
assignment
Banking Department at Bankers
Trust, he will deal with business
orginating in Arizona, California,
Idaho, Montana, Nevada, Oregon,
Utah, Washington, and Wyoming,
as

well

as

in

Alaska

*

sit

and

Hawaii.

*

The First National City Bank of
New

York

announced

Sept. 8
that Sidney A. Da Costa, Philemon
on

late

fall.) In Union Dime's second

lease

the

40th

bank

has

partment Heads of the Public Re¬
lations Department. Mr. Da Costa
will be in charge of magazine and

advertising, the Bank's
magazine, special displays
and related media, including pro¬
newspaper

house

motion

of Travelers

Checks.

Mr.

Hoadley will supervise the Bank's
television activities, special pro¬
jects, etc.; Mr. Page will be in
charge of publicity, press releases
and creative writing.
They will
work

under

the

supervision

of

*

Plans for

an

increase in the cap¬

tinue

Assistant

as

con¬

Department

Head in charge of operations and

special assignments. Media sched¬
ules and production of printed ma¬
terial

will

be

supervised

by

Fr

%

County,

N.

Y.,

were

approved by the State Bank¬
Department on Sept. 7. The

ing

proposal calls for the enlargement
of the capital from $325,000, con¬

sisting of 6,500 shares of
stock,

Franklin,

James C.

Olson, a partner in the
management consulting firm
of
Boos, Allen & Hamilton, has been
to

the

Board

*

*

The Franklin

$50

Board
York
York

sie,

of

Directors

Trust
on

of

Company

of

the

The

New

of

New

House"

and

appointment:
William
R.
Monroe, Assistant Auditor, was
promoted to Auditor. Carl Zeterberg
was
appointed
Assistant
Auditor.

posed by the directors

of the bank

in

Avenue,

its

newly

tive

Aug.

$300,000

$100,000 to
result of a stock div¬
from

25,

as a

of $200,000.

idend

sale

The

of

new

in

increase

Texas, was increased
000 to

$225,000, resulted from a

while

dividend,

stock

the

and

Essex

&

that

tracted to take

Na¬

Banking

From

have

they

over

Co. of

Trust

con¬

§

Cr

from

the South Or¬

itself

fVvr

colne

firct

fl-iA

the

paper

and

will

set

up

a

office there, its first out¬
of Newark.
Howard is also

Newark's

South

branch, which is located

Orange
the

across

an

Howard

from

has

State

received

Banking

Commissioner

ap¬

and

Charles

R.

Howell, permitting it to oper¬
ate the South Orange branch of¬
fice.

F.

external-internal

New

York,

*

ff

.

tf

Tentative

date

for

the

change-over is Monday, Oct. 3.
tative

approval

from

the

Comp¬

troller of the Currency's office for
its part irt the purchase.

election of John D. Britton to the

ange

is

Managing Partner of Conning &




"Shareholders of the South Or¬

Trust

approve
man

become

position Mr. Mitchell, who retired
bank

the

from

banking
will be

specializing

the

mid-year 2011 Safeway Stores
in

the

Canadian
I

Joins Coombs & Co.
(Special to The Financial Chronicle)

LOS

Calif. —Allen
the staff

ANGELES,

B. Hunsicker has joined

of Coombs and Company, 602 West
Sixth Street.

CONCERN

sales for the 1,868

the

will

meet

sale.

shortly

Their

to

seven-

board of directors will act

as

$18,014.

was

weekly

average

opinion of Management,

profits

are ex¬

Company's construction pro¬

calling for completion of

two or

States and Canada. The average

three high volume,

erating cost retail stores

a

low

op¬

week.

mums Comparison of first 24 weeks of 1954-55
1954

June 18, 1955

Net income

•

5,553,500

6,615,971

168,017,753

165,847,270

287,650,991*

246,826,572

156,733,595*

132,778,901

Total current assets

after

•

•

•

.••••••

Total current liabilities

......

Common Stock—
deducting preferred dividends
per

Common

$821,863,404

...•••••

(after all taxes)

Total net assets

Earnings

June 19,

$887,210,738

Net sales

share

on

$1.29

$1.76

$32.40

$31.73

3,489,184

3,369,521

>

share of

Stock

..»••••

Average number shares
Common Stock

outstanding

.

•

•

•

,

.

.

•

Number of stores
in

operation
*

.

.

.

.

Ratio of current assets to current

2011

liabilities

as

of June 18, 1955

1.84 to I.

Safeway Stores,
4th and Jackson Streets

•

con*- '

securities.

gram,

operation in the United

a

to

pected to benefit materially from

were

after

in

counselor

vestment

pany,

1954

in

of nearly 43 years,
financial adviser and in¬

career

a

excellent. Sales and

year.

asso¬

In his new

Safeway's long range prospects are

was

Henry C. 'Brunie, President of
Empire Trust Company of New
York announced on Sept. 13 the
Board of the bank. Mr. Britton

has

the firm.

ciated with

of the

period last

secu¬

The Canadian Bank of Commerce

"The National Newark has ten¬

■

Canadian

rities, announce that Ernest Hugh
Mitchell, former senior agent of

per store

In the

prices, net income for

& Ge.

Ashplant & Co., 2 Wall
Street, New York City, dealers in

the first 24 weeks fell below that

At

bank

B.

for their 143 stores was $18,534.

unusually severe drops in

same

converted

E. H. Mitchell JoiK

Canadian per store

all time high.

Book value per

street.

Insurance

As

system the

capital of $350,000 and sur¬
plus of $482,355. The President is
Leslie Nerland, while William M.
Cartwright is Cashier.
;

United States stores

buying all assets which are eligi¬
ble for mutual savings banks, in¬

"The

addi¬

an

weekly

94

sales for the first 24

inventory losses resulting

world coffee

Sept.

a

South Orange,

indicated,
"The Newark News," we quote:
"The Howard is purchasing the

proval

National

the

LARGEST RETAIL FOOD

Jv}/*7X> Safeway's total net

both of Newark, N. J., have

National

to

Half Year Business Briefs

Due to

Institution

Newark

SECOND

WORLD'S

Savings

side

Fairbanks, Alaska.

INCORPORATED

if

on

tional Bank represents a convers¬
ion of the Bank of Fairbanks, at

from $625,-

Part of the in¬

$1,000,000.

crease,

weeks of 1955 set

J.

the

to

stock

$50,000 has effected an
the
capital of the

amount of

According to the Newark, N. J.
"News" of Sept. 6, the Howard

N.

issued

was

by

«

Na¬

by the Comptroller of the Cur-;
rency at Washington ( D. C.
Ac¬
cording to the Treasury Depart¬
ment's Bulletin of Sept. 6 the Na¬

'

*

%

ange

Alaska

Fairbanks, Terri¬

1

in

*

«

#

completed

Arthur T.
Roth, President. On the same day
the
new
Plainedge Office was
opened in temporary quarters at
4060 Hempstead Turnpike.

Co.,

of

of

Sept. 10, according to

on

announcement

an

Bank

F. B. Ashplant
Lake
Mineapolis,

of

Bank

Uniondale Office at 410 Uniondale

Sept. 13, Adrian M. Mas-

Chairman of the Board, an¬
the following promotion

nounced

surplus. An item relative to the
changes in capital accounts pro¬

the

for

tory of Alaska,

*

*

Bloomington

Minn,, increased its capital effec¬

Frankln Square, N. Y. held "Open

of Directors

meeting

*

First

,

plans to allocate $2,050,capital and $4,100,000 to

tional

*

*

charter

$100,000, effective

Subscription rights will be evi¬
Kingsport National Bank of Kingsdenced by transferable warrants
port, Tenn., from $150,000 to $200,which
will
expire
on
Oct.
7.
000, the enlarged capital having,
Johnston, Lemon & Co. has agreed
become operative as of Aug. 25.
to purchase the unsubscribed por¬
*
*
*
tion of the additional shares being
As of Aug. 31, the capital of the
offered. Of the total net proceeds
from the sale of the extra shares, Citizens National Bank in Abilene,
to

*

A

by a stock dividend of that
amount, enlarged the capital to

$200,000, from
Aug. 31.

two

12.

a

Na¬

tional Bank.

par.

Bank

business will be transferred to the
a

each

for

of record Sept.

result

about

share, on the basis

share
as

a

become

Seattle-First

*

National

of the Colonial Trust Company of

Following

new

As

has

bank

the

common

cluding mortgage holdings of some
$3,250,000 and will take over all
the savings deposits, currently to¬
New York,
Arthur S. Kleeman,
President of the banking house, taling 4M> million dollars.
1
"The National Newark for its
announced on Aug. 17. Mr. Olson
is
also
a
Director
of
Bancroft part is purchasing all assets of a
commercial
type and will take
Rackett Co. and Walters Drilling
over
checking accounts totaling
Co.
$3,700,000.
This section of the
*
%
*

elected

one

of

$50 per share, to $425,-

par

in shares of 8,500,

000

branch

*

%

of

shares held

000

bank

Pepper Birchard.

stock at $30 per

subscribe for 205,shares of capital

the bank

Suffolk

announced

Hevener will

F.

additional

bylon,

Cashier.

O.

es¬

if

:S

the right to

ital of the Bank of Babylon, at Ba¬

tional

S.

74,000
West

Street for its permanent

Carrel, Vice-Presi¬
dent, and J. J. Lawlor, Assistant

Granville

111

tablishment.

N.

Hoadley and Robertson Page
have been appointed Assistant De¬

taken

feet of space at

square

000

absorbed

by

absorbed

was

Seattle, Washington.
branch

has

,,

increase

An

capital
Bank

*

ton, the oldest bank in Washing-

Lorain,

capital as in¬
from $200,000
on
Aug. 31, the enlarged figure
having been brought about by the
sale of $50,000 of new stock.
Ohio,

The

permanent

new

of

creased to $250,000,

National

This space will serve as temporary

Bancroft, President.
*

of

corner

$270,000.

*

*

Washington,

the

Oct. 1 to stockholders of record

ment.

Excelsior

1

*

As of Aug. 29 the Citizens Inda- ;
pendent Bank of Longview, State
of

on

on

hours

*

the Seattle-First National Bank of

Oct.

1, by action of the
bank's Board of Directors meeting
in Richmond on Sept. 9. The board
has declared a third quarter divi¬
dend of 25 cents per share on 360,000 shares of bank stock, payable

p.m.

business

The

stock.

*

dends

of

*

•;«

yielded from

was

new

Va., will receive $90,000 in divi¬

on
$

worth Athenaeum.
*

Atlantic

of

City, N. J.

phone Co. and Treasurer of Wads*

by the Board¬

Bank

$150,000

*

jf

2,600 stockholders of The
of Virginia, at Richmond,

Bank

The Mainland National Bank of

tional

the sale of
*

Some

CONSOLIDATIONS

REVISED

issue of Sept. 1,

our

887.

page

National Newark."

NEW BRANCHES
NEW

appeared in

incorporated

Oakland, Calif.

2016

24

The Commercial and Financial Chronicle

(1083)

less al least 85%

fering is sold and paid for within

Cnvtiviiprl

imm

1

rmrtP

F

j

y

»■

f

m

C

kJllHlw

MnM

.<

DvAhlAMK* PAVITf AMI IflfV

Aim A

in

A\r.l-

1UWvKli* VUIil» vAIIAilJI UIV tlUV

m

quires companies whose securities
are
listed on national securities

six

exchanges to register those

months after the commencement of the offering.
(4) in computing the amount
of

question, that the terms of the exemption have not been complied
with, or that fraud is being pracpaid to ticed in connection with the of-

irresponsible advertising to instances in which the
promoters appropriated for themmisleading

and

selves most of the
finance

the

the

money

securities

iered

These

securities.

there would

"Prompt

and

have

be

to

of-

be

regulation,
included

or

pronosed

to be

issued, for

as-

regulations

represent

a

dealers

or

security salesmen,

ex-

Sreat improvement over those in cept to the extent that such seeffec^ Pn°r t° 1953 in terms of curities are escrowed or otherwise

vigorous action
bv the SEC to

taken

be

could

new

the amount, of all securities issued

-

should

which

the

under

fering. Regulation D in the main sets or services, or to directors,
contains the same requirements.
oflicers, promoters, underwriters,

and left for
practically worthless
venture,

public

of the total of-

....

Thursday, September 15,1955

certain

specified

In

report,

its

exemptions.^
Commission

the

recommended that the bill ba reities with the Commission, to file vised to require registration of
periodic reports, and to comply an.y class of equity securities the
with the Commission's proxy rules record holders of which numbered
in the event proxies are solicited more than 750 and that the asset
from

the

ties.

secur-

In

of

owners

securi-

such

addition,
the
officers,
directors and 10% stockholders of
those campanies are subject to the
"insider" trading provisions which

test

abandoned since it would

be

be a satisfactory measure of
company's significance in terms

not
a

of earning power and public in-

terest, and would be equally unsatisfactory froip the standpoint.
and transactions and permit the of administration and enforce-company to recover profits made ment. The Commission feels that
by those persons on short-swing the selection of 750 record holders
transactions. These provisions do represents a reasonable test of
not generally apply to over-the- public interest in a trading rnarcounter securities.
ket in a security and that it would
In
its report
"Stock
Market be appropriate to use this test to
require reports of their holdings

investor protection. However, the effectively held off the market
recent Commission study of the/for one year after the commencefivit
in uranium «tnrir«
°Peration of these regulations has ment of the offering.
hv thp Saw in thp num"
revealed certain glaring inequities
(5) No sales literature, other
L vL
,
,
; JfBn"v-" in connection with offerings made than the prescribed offering cirrtn
hiNinpsc
in
*nrh
«tnrk«
Tn
thereunder, particularly by newly cular and limited advertisements Study," the majority of the Senate the exclusion cf any other for
Tnnp iS? thL
organized
uranium and
other specifically permitted by the rules, Committee on Banking and Cur- purposes of requiring registration
wit h thp rnmmk^n 147 hrntprc
mininS ventures. Issues have been could be used in connection with rency stated:
of an equity issue,
and dealer1? located in the ^even
sold to the public on a caPitaliza- the offering of securities of pro"Several of the witnesses ques^ order to provide against the
nrinrina
western mining «t»tS tk)n basis th.at re.flects a promo- motional companies.
tioned the 'double standard' that uncertainties which might arise
these

curb

abuses"

prnwth

Thp

,

the

nf

srwnlativp

p„

serviced

area

Reefonal

bv

Office

Denver

our

Bv

June

955

the number had increased to
Manv

of

brokers

who
in

the

and

had

newlv

dealers

registered

were

oreviouJ

no

258

person*

exoerience

the securities business and

oarentlv

induced

were

because
tive

of

the

fever

coupled'

with

proximately
the

tn

snecula-

development

increase

an

300%

to

an-

1952

under

ulation A experienced bv

h^s

of

since

number of filings

Hce

it

enter

existing

This

an-

in

Reg-

that of-

impeUed the Ctomtesion

intensify

efforts

its

public investors.

As

to

protect

of its

part

a

investigation and enforcement prothe

gram

team

and

of

Commission has

broker-dealer

attornevs

fice for

a

Denver

Of-

few months to conduct

a

intensive

an

the

to

sent

inspectors

inspection

program

primarily directed to broker-dealer's

registered with

the

Commis-

sion who have not been inspected

recently

who

or

have

iust

reg-

istered.
From

10^

thp

hpennnino'

nf

Anrii

A

exPlor?tlon

deyelopmjent pro-

&ram 1S n°t obtained.

Offerings
bave been commenced where unde.rvyri^ers would receive a commissl°" plus advances for legal
and seliJn& exPenses which in the
aggregate would amount to almost
one~tbi„rd of the total gross pro-

fetters of
f.ioH
thi
1954

aband°"ed

.

'
'hat underwriting
resolution^commissions and expense allowcowrrns ni offfS of ?ulcef w.0uld absorb Virtually all
nofifiration

3^>8

issues

?fW

ine

wp™

fit seenrfties

4nnnnn

number

9.91

suorresat

thif

nf

anri

orp

rPnrPQPn+Pri

p;nn nnn

groS^ hrorP^,'
for

averaee

nraninm'

thp

$208 00ft

was

parh

■

the fu"ds, received leaving little
Proposed

Kpjrnlafinn

nf

ThP

of

is

issues

a

investor

nthpr

?S W

v.S n0

T

u

•

th^^hought

with

nrotprtion

regulat?on

the

bv

•

Jn

mind'

af

I?

was

ihltTho

3n<i ^ana

companies on ident-

!^al .termstand

SmCe
which I have men-

tl0ned existed in the mam in
initiatpd
ovpr-aii
respect of new ventures, a distincings madp undpr "thp PvisHno rp«" tl01J.w0^ld be "?ade between prolations
sinrp
thpir
fn jp0^10na? and °^ber companies. A
the snrin? of 1953
promotional company would be
eAned,a? one which was organpassa£e
®
ized within one year prior to the
A t the Commission [A
has
Commission

in

thp

Fail

nf

ctnHv

an

iq^a

ftf

fii

adnntinn

c.

.

adopted

date

a

letter of

o??\ °4 regulations notification under Regulation_ A
n
f5
^am
' 3
wblcb had not had a net in-

^

^

j

investor's, otners have' Sed suet
the
ujc

which it filed

on

o^diseTo^lo^spe^tW; iz^dmor?

grees

escrowing
eiuuwmg

of
oi

auired
quirea

romnlianpp

statutes

as

with

compliance

condition

a

2i 0f this
nett

the
bilI

Michigan introduced in
House of Representatives a
which would
al Section

for

the

vpars

years.

last

two

fiscal

crxooioi

ine-following special requirements would apply to such

prinrinal

^

A

fpntnroc

+hp

nf

w u

A

,

be

filed

An

with

office

offering

certain

the appropriate

of

the

circular

specified

of

case

vides

offerings

denied
.

.

t a

except in

not

administrative

the

or

that

..

liaoie

pro-

can

be

if the Com-

the
,

to

the

machinery

exemption

suspended

finds

is

exceeding

The Regulation also

whereby
mission

containing

information

required to be used

$50,000.

re-

Commission

,

e secunties to be offered

ay.e t0 pe Quallfied -and

exemntion

p

.

the company in




onprati/n*
at

*

^

.

*

w

d

.

be permitted under the
^

Commis-

sider trading merely because their
securities are not listed for trad-

ing on a stock exchange."
On May 24, 1955, Senator Fuleliminate

provide

bill

a

the

investors

commission

opposed

Bennett bill before

a

the

Subcommit-

the

to

bill.

It

also

pro-

any

which

so-called

Other changes recommended by
the Commission include provision
for termination of registration by
Commission order upon a determination
by
the
Commission,
either

its

on

own

motion

or

upon

in

over-the-

met;

provision

for

authority

in

tee of the Interstate and Foreign
Commerce
Committee
of
the
Rouse which is considering it. We
pointed out that in the course of
^e 1953-1954 amendment program relatip§ to the statutes administered by the Commission, the
Senate

passed

Section

3(b)

amendment

an

which

would

bill follows substantialy the pattern of legislation recommended

for cause; and provision that it
shall be unlawful for any broker-

by the Commission in 1946 and
1950, and of bills introduced in
the House of Representatives in

dealer to effect transactions in a
security as to which a suspension

1946 and in the Senate in 1949,
all of which fail'ed of passage.
v..

have

rajsed the permissible limit to
$500,000.
This amendment was

^

SEC V,ews
The

to

comment

proposal

Senator

on

1V>

was

.

asked

to

Fulbright's

and expressed

the

view

supported
by
the
Commission,
However, it was rejected by the
House of Representatives and was

that the "broad principles and objectives underlying [the bill] are
sound and the Commission supports them."
Further, "The fact

dropped in conference.

that there has

The exemptions provided for in
gectj0

3/^)

refiect

a

long-stand-

tba| toZlt
weighing of brougnt

a

interest of the nartieular

.

t

no

means

by

order is in effect,
Accprding to estimates, approximately 1,500 companies would be

required to register one or more
classes of publicly held equity securities.

fleet

the

suggested changes and
into law, the protection
benefits for the public in-

enacted
and

vestor which
which

.

nur-

nroviding fairlv

of

to

to

bllf tor tne benefit
lovVebLtit
bear

investors
th

_

in

our

t

important

markpfs

is

nf

over-tne-counter marxets is ot
concern to this Commission as it

tne

provided—all
with

of
the

Sefs ^ whict "to
markets in wnich securities

are

traded,

or

business,

small

The public hearing

on

^

the Ful-

bright bill

developed strong supPupnc nueresi in proviaing iainy
nrPHpr<P«nrs»
T,
\
1
4,1 g
p
9uick and easy access to the pub- has been to our predecessors.
port for its enactment. There was
Be capital markets for limited
Since the Commission had not also opposition to its enactment
am0unts of capital by small ven- had sufficient time to reach de- from various industry groups on
.

tures

or

unseasoned

enterprises,

finitive conclusions

the

of

pects

bill

on

in

certain

the

as-

short

b^en. its intro-

a more stringent exemptive duction and the Commission s mregulatl0n- which has been pro- itial appearance before the Sub-

posed by the Commission, than by committee to which the bill was
repeal'of the statutory provision referred, the Commission was rewhich makes the regulation possi- quested to suggest
amendments
ble.
at a later late. A report containThe Fulbright Bill
ing these suggestions was transj should like to mention briefly mitted on July 19, 1955.
^

^

As

introduced,

the

bill

would

the basis that there

revised

the

The Securities Exchange Act re-

$5 million

or

company

more

in assets with

ac-

not
asset

eliminate

entirely

provision

in the
of equity securities and those
companies having 750 or more
case

more

having
securityholders and

any

did

total

record

of

more

in

the

committee. However, the Subcom-

mittee

curities
or

substantially

with

suggestions
made by the Commission, was reported upon favorably bv the Sub-

500

respects.

public

On July 26, 1955, the Fulbright

bill,

cordance

assure the return to

certain

was no

need for such legislation.

require the registration of all se-

of the money paid in by them un-

it

consistent

are

principles and provisions of the
bill—would not affect adversely

^ Provision would have to be if enacted, would greatly enlarge
made' by escrow or otherwise, to the Commission's jurisdiction in
stockholders

The Commisison advised

the Subcommittee of its belief that
if the bill were amended to re¬

financial reporting and disclosures companies subject to the statute,

..

bn

been

which the principles and standards of fair, accurate and adequate

Basically.

the so-called Fulbright bill which,

v

^

the Fulbright Bill

on

Commission

Principai ousiness of

'
( }
securities could be of!ured except for tbe accRun.t of
fbe company; secondary offerings,
ail offerings of undervY^'jters
shares or options
/ox

subject

debt issue terminate automatically
if the principal amount outstanding is reduced to less than $1 mil-

Exchange

from conforming to statu-

or

introduced

existing ReeulaHon A fh»
n'elaTlofdeV interest would
We think the public
s"
"mIo^s: A notufcation must omptyhas & pTnetpa^'business
beUern S6rVfd by

gional

registered for offering under the

Securities Act exceeding ^1 million in principal amount also be

to

posed that the registration of

and

would

presently
are a

available with respect to
eebt securities and, in any event,
may not be as suitable a test of
Public interest as the principal
amount of the outstanding class,
The Commission proposed, therefore, that any outstanding debt
issue exceeding $1 million which
has been publicly offered under
the Securities Act of 1933 and any
issue of debt securities thereafter

curities

bright

a

^

Regulation

Record ownership is not ordin-

arily

financial statements with the Se-

for these regulations,

tmfudgX

hyad noPt" ad

^Thp-fnllowing

companies-

•

to less than 500.

be

appears

little valid grounds for exempting
companies
from filing periodic

Act which is the sta-

l"e mieresi 01 ^.e particular purchaser of securities as against the

its

There

statement that the number of

recorcl holders has been reduced

securities

national

on

regulastocks

a

On April tions governing proxies, and in- lion

Congressman Ben-

year,

o£

lodgment involves

of

and

One other solution to this prob- tory provisions, rules, and regula-

lem has been suggested.

least

one'

rules

same

companies whose

as

listed

are

sion

tors.

net income irom operations for at
ei income from operations tor at

state

availabilitv of the exemntion
P

com-

ments
received,
including
the
helpful suggestions made by the
state and Provincial Administra-

re-

ctoto

with

date o£ filing

an

sose

nromoters'
promoters

curities, and still others have

The

opportunity to consider the

that

hp

to

exchanges.

have had

we

the

tions

to provide for automatic term-ma¬
ion of registration 90 days after
the filing with the Commission of

prac- hold additional hearings com- counter securities with the pro- the Commission comparable to
as*
fifS mencing on Sent. 8 in Denver and tections and benefits now afforded that which it has in respect of
kG Sept. 14 in Salt Lake City.
'
investors in listed securities. The listed issues to suspend trading

a^-

given

determined until

July 20, 1955. The Committee will

Withta view to preventing

a vera

annarent

forded

and

J1"0™ the fact that the number of
holders of an equity security
might vary somewhat above and
below 750, tne Commission proposed that the bill be amended

Pu,b,licinh^arin!?s °n the biU w?re "double standard" between would aPP»cation inthat certain statutory
listed standards
held
Washington commencing and unlisted securities and
the bill have been

.

Kegu,at,on A

wui,

icqhps

Ax/hiip

Revisions

eTd$ 133 nnn ?
n?
ffnanpin<r 'nn ' commisston on July 18, 1955 pubder the Commission's PYPnfntix/P
.sb for comment a proposed reregulations considered in thp
w*°n 3a C°i1S?i
Ji?11
Re£u~
gregate
is
substantial
and
im" a ?n A +an
-J
PJ'PP05^1
porfant' It is also mdfi pW iT.'f contemplates that Regulation A
careful
consideration
should
be available to domestic
mining

It

fruitful discussion yesterday
afternoon. The definitive form of
the new regulation will not be

or no funds available for the com- 3(b) 0f the
pany s development.
tutory basis

fer

.vere

•

engaged in the mining of uranium
pronosed

of

n

(October

end of

...

.pi ceeds from the Offering. More? °Ver' *,lhS oti?r}^was, n°t welj

ml,

Rppi'i 1 nf i mi*

tional
participation
heavily
The prODOsed amendment rep- exists in the regulation of securiweighted against the public inves- resent imDOrtant improvements in ties on the-exchanges and over tne
tor who furnishes the initial cash the regulations, based upon the .counter. An issuer of securities
caPltaL othcrs are sold sunder'experience of the Commission in registered on a national securities
terms which gran* Promoters and "their administration since the last "exchange is subject to one set of
Underwru1^s options- and' /-W".-revision'in April 1953. They regulations, whereas another isFants whlfh' even if the venture should asist and protect the pub- suer in the same industry, of the
1S successful> Pr°vide the insiders ]jc investor but should not retard same size, with the same number,
and underwriters with riskless the raising of capital for legiti- of security-holders, and with the
and potential profits at the ex-^mate promotional ventures. In same degree of public interest
pense
the public stockholders fac^ they should provide greater whose securities are traded in the
by dllutin& their investment and assurance that the bulk of the over-the-counter market is sub?bare °J pr0Jlts:
great major- m0ney sought to be raised for ex- ject to entirely different regula!, ? offerings are on a "best pioration, development, and simi- tions
'
efforts basis and tbere is n0 as" lar purposes will actually be
*:■
*
*
surance that enough money will available for those purposes.
"The committee is of the view
be raised 1° explore or drl11'
We feel this is one of the most that as a general policy, it is in
^u^eye1"' 1there has been no un- important matters now before the the public interest that companies
dcrtakin2 to return the investors Commission. We will receive pub- whose stocks are traded over the
even thou£h an amount suf- uc comments on the proposal un- counter be required to comply
flcl€;nt
carry out the company s til Sent. 15, and it was the subject with the same statutory provisions

holders and $2 million

or

in assets would be subject
to'its provisions. Any security issued by a bank or any isuer which

Volume 182

Number 5464

The Commercial and Financial Chronicle

...

25

(1089)
is

insurance

an

ject

to

state

corporation

supervision

toward

sub-

is

of

spe-

cific-aily exempted.
On

v

Aug.

Klein

of

2,

will

York

these

hear

much

proposals

session

the

of

the

the

Congress

"Canadian Problem"

extradition

applied

cerning what is oftentimes called
the

Canadian

at

the

phrase

the

which

Problem.

outset,
to

come

Let

me

fairly

with

describe

which

have

we

activities' visions

the

of the Securities Act of
con-" 1933 because Canada has no sufficiently
corresponding
statute,

been

cerned.

pro-

»

'

and

From the standpoint of the
Commicc;nn

mission, ihe primary
to prevent frauds

,,

„

upon

The

zens.

the

is

citi-

our

problem is created

efforts of

unscrupulous

by

Tlnitprl

s. in bhe

^

frnm

n^ B^nbafef-mtCan;
actlvltl€s °f

thic
this frinpp element w
fringe pipmpnt were centered
in Toronto and later
shifted to the
Province of Quebec when
the

of

tario

Securities

Commission

ni0on0j

situahon
situation.

„„

ef7

rW

+1

i?Jhe T°r0nt-°
of

The

ease

communi-

cation

by mail, telegraph

phone

across

or

tele-

the border makes it
possible to conduct high
pressure

selling campaigns
Canada

as

readily from

from within the United
The basic
as

States.

difficulty of the

Commission

and

other

and state agencies in

diction.

Moreover

clearly violate

these

Althnnuh

Can-

Un,ted

lv,„tbe.in

prnHnvpH
employed

effort

an

to

th
the

nvpr

over

desire

with

cope

the prob-

r?npVpf Cfh

extradition

d^ff*

*+vf
u,
1 ir
n wi hrcef
hppn
been thn fpp?ir?J1pCiatV,
S
the feeling on the
5
part ot
in

hav»

pnnnpptip

+

some

provincial officials that Amencan
securities laws and proce^
dures are unduly
complex by Canadian standards and
difficult for

legitimate

Canadian

mining

first

3V

and

stpns

1949

mond, Va.

Drobl'

Convention

j,

.

Si
en mC0U,d.be
S SSianc!uWith 0ur st.a-;
tutes, in the hope that provincial
u,

r

authorities

would

compliance

with
"

then

require

laws

our
v

This

j

surrounded

S°th,er t r ngs •to the limited
MttLZZ?k sdnjmistraw

^SJ.|"ri?"CfJ",^ePhd0(S°Phy
tlr.

between

i

d. ®

a,nd

Can"

,

ibf' hd admlmstraJii' by the v!b™„.."!;!?La?:
", fii
inexperience of

gravated

.

.

Sf fh
cedurel

L

w

,

Was

suc,h an (u"£°rtunate la!* oJ

P™!
*

ACfeAcL rtula"ors fhft
American regulators, tnat

,

PI trUtly c00,Perat"ve s,tef.s we":

L

u

+

.,

P

unde,™'"t-

After
ni

years

ec

es

concluded
venhon

gitive
c

b

•'

a

of negotiation the
and Canada in 1952

Supplementary Con-

for the extradition of fu-

criminals

y,

"

any and all

which

4

fraqds which

both

contracting

larlv

those

nection

went

and

rniipd

activities

of

?hae^ Resronsiblf securiUes
deMerfboth in Canadaand in the

united

States

cerned

for

it

is

panacea.

did

not

We had hoped,

that it would be

a

essential

enterprise

of the
cated.

that

fringe
The

e

to

n-

the

theconfWenceof
the channeling
into legitimat|

to
savings

their

uallv

are

abusive

element

in

areas

a£/reement and coouerations is
agreement and cooperations is
disagreement, it is therfu maV b<:
with

°

§reat; and

to methods and mechanics rather
than fundamental differences on

be

a

however,

significant step




of

is

the

Central

Banks

in

currently

exist

intended
Federal

to

in

the

The

economy.

in

higher

order

to

obtain

In

come

rediscount
for

their

borrowers
very

that

much

can

as

com-

"For

hardening

for

from

member

banks

naturally brings
are

It

but

from

the

Central

though

the

belief

now

the

work

in

we

Stock

Exchange's

are

lieve

this field

and

I

be¬

working toward a
goal—responsible public
ownership of this country's pro¬

common

resources."

Malcolm Smith Ghman.
Malcolm Smith, limited partner

a

in

the

Dean

Witter & Co., and for¬
partner in J. H. Whitney
& Co. and Glore Forgan & Co. is
Chairman of the Board of South¬

merly

This,

a

Nitrogen Company, Inc., re¬
cently organized to establish a
petrochemical
plant
at
Savannah, Ga.
ern

financial

modern

>

in order to bring about a rapid
and telling influence
upon the lending policies of the member
banks of the Federal Reserve
System.
With

of

advantages of share ownership is
encouraging. I know of your

own

are

powers

be

and

most

own

district is that, while interest rates will tend to harden
somewhat
there will not be that severe type of action by the
will

expand

Of New Chemical Go.

more,

that be which

to

surprising to

Banks.

in

our

educational program to tell people
everywhere about the risks and

the question as to whether of not the monetary
going to go that far in their interest raising
as

upgrading

of life.

efforts

corporate
citizenship,"
Javits added, "Mr. Funston

holders

up

seems

our

accepting the award, Mr.
said:
"Mr.
Javits, this
recognition by the United Share¬

is

interest rates will in time have

also

for

of

In

influence upon borrowings.
However, this might
yery drastic revisions upward in rates for loans not oftly

mean

pillars

Funston

marked

very

way

his

essential

so

the
and

has
displayed high qualities of
leadership in the public interest."

profitably use the money, not being
the higher level of interest rates.

process

Keith Funston

improve
Mr.

Impact of Credit Policy Still to Be Felt
The

in

necessary

uniform rediscount rate of 2]/4% the question comes
up as what will happen to the "prime bank rate" which was
raised
not so long ago to 3%% from 3%. Some
money market specialists
a

are of the opinion that there will be an
upping of the "prime bank
rate" in the very near future. On the other
hand, there are those
who hold to the belief that the
"prime bank rate" will not be raised
until more is known about the duration
(that is as far as the time

factor is concerned) of
monetary authorities.

the

interest

rate

raising

policy

of

the

With F. I. du Pont Co.
<-

(Special to The Financial Chronicle;

CHICAGO, 111.—James M. Peticolas

has

become

associated with

Francis I. du Pont & Co., 141 West
Jackson

colas

Boulevard.

has

business

been

in

in

Mr.

the

Chicago

Peti-

securities

for

many

years.

Higher Reserve Requirements Possible
Some followers of the money market are now of the
opinion
that the rediscount rate will be
upped to 2l/i% by some of the
Central Banks in the not too distant future. At the same
time,
there are rumors about that reserve
requirement of the member
banks will also be increased as
part of the operation of the
powers

that be.

credit

U. S. TREASURY

The raising of reserve requirements of the member
banks
Reserve System would have a much more

limiting

action

these

on

institutions,

than

will

STATE, MUNICIPAL

positive
higher

and

problems which will be both

mon

effective and merit the wholehearted support of aii concerned.
The public has benefited
greatly

„

,

,

The

and setbacks.
1 have been deeply impressed

with

the

great

strides

forward

which have been made. I
fident that we will reach

am

our

timate mutual goal before too
and

that

ner

that

all_ the
£er

and

our

do

we

re£lects

comlron

t

t

&

credit

national
of

ul_

long

in

with

standards

con-

to

charac_

morality of

_

PUBLIC REVENUE

_

last,

they had 350,888 loans for
$1.4 billion outstanding. Farmer-

12

Federal

land

banks

solidated Federal farm loan bonds
to be dated and delivered Oct.
3,
1955.

The bonds

are

being offered
at 99%%.
The offering is being
made through John T.
Knox, the
banks'

Fiscal

Agent,

with

borrowers

own all the $85,000,000
capital stock in the system.

of

the

assistance of

a nation-wide
group
of security dealers. The
proceeds
will be used to
repay commercial

Howard

Millet

Of Nathan C.

Vice-Pres.

Fay & Co.

PORTLAND, Maine—Nathan C.
Fay & Co., 208 Middle Street, an¬
nounces

that Howard Millet, who

has been representing the firm in
central Maine for the past year
with

offices at Augusta,

'has been

elected Vice-President of the
pany.

Before

joining

com¬

Nathan

C.

borrowings and to finance Fay & Co. a year ago, Mr. Millet
lending operations.
represented the Boston firm of

current

The

Barclay Inv Co Adds
CHICAGO,
been

111.

added

—

to

Dora
the

loan

Cohen
staff

of

Barclav Investment Co., 39 South

La Salle Street.

12

Federal

land

banks

through 1,100 local national farm

(Special to The Financial Chronicle)

associations

farmers

on

farm

make

loans

mortgage

SECURITIES

on

Sept. 13 offered publicly $130,000,000 of IIV2 month 2%% con¬

bank

nations

_

Sell 27/8% Bonds

pr°blem is COmpli-

""^understandings

,

Federal Land Banks

from what has been accomplished

has

imulating

American

far by

as

n's

o

they have

interest rates.

our

t

ductive

However, with business conditions as favorable
ever been, and taxes at near record
levels, it is not

Mr.

t

government

up.

fort to find

solution to

rate

marginal credit is refused when interest rates

cases

was
on

s

strengthening

lending operations. The member banks in turn are expected to
discourage customers from borrowing by charging higher rates.
moving

n

corporations,

making member

funds

u

ship of pub¬
licly-owned

increasingly

an

Banks

Javits

shareowner-

discourage member banks from borrowing from the

Reserve

,

award,

Americans

,

High

became

of the Federal

a

s

inflationary psychology, and the two of them together
bringing about the maladjustments which

objective. We of the Commission
Pledge ourselves to a renewed ef-

se¬

conceive

to

an

eradi-

the

of

con¬

in

also

practices
be

of

scope

action
more

s

the interest of

have gone a long way in

operations.

inter-

rates

Share-

cating and

attempt by the powers that be to slow
down the forces that not
only create inflationary pressures but

authorities

unscrunulous

nahonafopt

recent

sleeves

to work

interest

on

was

Ribbon

work in "Edu-

years.

The

qIppvpq

thpir

nn

particu-

occur

amendment

and

pressure

F

Chicago,

borrowings cost

rec-

The Dominion- 'and Provincial
governments of Canada and the
Federal and State governments of
United States have a strong
mutual interest in stopping the

by the laws of

transactions

We

treatv

spe-

are pun-

states,

which

with

curities."

was

to comprehend

ishable criminally

this

V"

quirements.

....
■

another, to

°&nize their respective virtues
anri

might be in the future.

"Blue

United

of

i t

a v

said,

seems

eight Federal Reserve Banks, namely New
York,
Kansas City, Dallas, San Francisco, Min¬
neapolis and Boston raised the rediscount rate from
2% to 2V4%.
This is the second increase in the
lending rate of the Central
Banks in a little more than a
month, and is a continuation of the
monetary authorities' policy of making the creation of debt more
costly. The upping of the rediscount rate from 2% to 2
*4 % by
the various Federal Reserve Banks
brought the rate which they
charge member banks on loans to the highest level in 20

in

rect °ur e£forts towards ™'king
things out." The persons involved

faiJit(?

or

when

Richmond,

shoufng'and'df
one

upward

deterred

representative

u

Tssuers »d" t0 date' The
offering from C^n- ^ »nA

7h'h, the

?

do

J
The

As for the intermediate and

Rediscount Rates at 20-Year
The

find

someonS-I

meeHng

^

XEut

almn-t

so

gilow? Point oi vlew°'and* Zfe
win?ft view, and there
lellow s

Moreover

underwrjters

hv

r£ em0tl0nal blocks, there was

respect

•

f

_j-

Rich-

in

Prior to that time the

wa<.

investors and

y

...

rlari-

manvTmoTfo^

of

??

provide a

toward

measure, as a consequence

of the

rimnliflrS'""S,.

rwas

And

13 s P toward clanl'c?tl0„n o£ thls subject came about'

mahfte'nafeof

n

reachpri

it
is to the credit of this Association

wUP°r p!r„Jf'U;eS '° Tft

I

nnt

have been made.

to know

^
in

of tnis operation as it has been

evident

in

A.

longer-term Governments, they have been
fluctuating within the
recently established trading areas, with the market for these issues
still thin and on the
professional side. With the Government's new
money financing in the offing, it is not expected that the
interest
raising pressure will be applied quite as sharply during the time

In

met

significant cooperative ad-

vances

i,

vears

c\fad?3CnUandgnro°?eedirfS
tip*

W; not

,„P

current levels.

Exchange,

the

the

President.

based

settling around

of

America, Inc.
by Benjamin

Mr.

Treasury bills,

on

Stock

v/ith

holders

to be

British

than as a routine instru™nt of law enforcement,

persons

any

offIrinVeserm 'Ihe
0£fermgS t0 the

Mtfnx,
been
been

the

Award"

With the drive for higher interest rates
still going very
strong
the Government market
appears to have held its own rather well.
Short-term Governments, that is the

yield

Funston, President of the

York

presented

up the cost at which the member
banks of the system borrow
money from the Central Banks. This
resulted in the rediscount rate
being again raised from 2% to 2*4%
by the rest of the Federal Reserve Banks. Bankers
acceptance
rates were also increased
again last week.

extradition

in

"as a^weamn

Federal

dealing with

may not

their

criminal-

Keith

lending institutions by pushing

interpreted in tne Bntis

Commot™ealth

dirttlyleacfviola^rsYnC*""? 't^t

States

of

thf goaf of understendin? and
ftLTachievement which afof us would

cuntpc

At

"double

qinternreteH

i?

differing regulatory and legal

ordeermto

Fd,

the

requirement

J

}

per-

UnTtednSs°whnhieu fH°m /he
S^he international boundary and
ot the
auvantag5
the

hence

lty

.

problem

Shareholders' Award

By JOHN T. CHIPPENDALE, JR.

New

to

reach violations of the fraud

Governments

on

The monetary authorities continue
to harden interest rates in
their effort to slow down the
making of loans by the various

that' state or provincial governments.The court held that enumeration
applied to' 11A of the Convention does not

be

Reporter
3

when

law

Problem""

this situation does not
adequately
or

extradition

however,

"Canadian

has

denied.

was

statutory offenses of
this kind as between countries
both of which have a Federal system' but a differing division of
authority between Federal

erable comment in the
press con-,

say

Keith Funsfon Receives
Our

>

The 1952- treaty amendment was
interpreted in a manner which
next limits its effectiveness, primarily
because of the complexity of in¬

There has recently been consid-

•

traffic

This hope has

about

more

during

visions,

ternational
The

elimination

securities

border.

Congressman l1™* fully materialized. ;In the first
introduced a case brought pursuant to its pro-

companion bill. H.R. 7845, in the
House of Representatives.
I think
you

eventual

fraudulent

across

1955,

New

the

.to

secu¬

H. C.

Wainwright & Co., members

New York Stock
same
was

territory.

principal of the Augusta

rity. In the year ended June 30,
1955,
farmers
obtained
57,000

curities

loans for

Co.

$403,000,000. At June 30,

Exchange, in the
Prior thereto he

firm,

Ingraham-Millet

se¬

&

Aubrey G. Lanston
& Co.
INCORPORATED

15 BROAD

ST., NEW YORK 5

Whitehall 3-1200
231 So. La Salle St.

45 Milk

St.

CHICAGO 4

BOSTON 9

ST 2-9190

HA 6-6463

'

(1090)

/

'/

The Commercial and Financial Chronicle...

'"/sta

v

26

//

/

*

Continued,

Railroad Securities

from

connection with the
meeting of stockholders
in

authorize the

called for Oct. 10 to

connection

third

to

a

is

first

preferred stock. Originally it had
been the company's aim to liqui¬
these

date

through

arrears

a

voluntary stock readjustment plan
under the Mahaffie Act.
While
this plan

approved by a ma¬
jority of each class of the com¬
pany's stock there were objections
*on the part of minority holders of
-the first preferred who claimed
<hey were not accorded full value
was

claim.

their

•ior

action,

court

it

resultant

the

In

instance

this

the

and

present capitalization. This would
be

higher than in the boom year
and
would
compare
with

1953

realized

$10.77
with
of

the

last
in

increase

stock

from

Even

year.

the

amount

to

shares

532,868

ture

far

share.

a

than

more

the

shares if the proposal

arrears

The

in cash.
first

the

on

arrears

fererd through the end of

pre-

the

cur¬

will amount to $108.50
share, or a total of $19,250,070

rent
a

year

field

this

the 177,420

shares of stock out¬
standing. In its proxy statement
the
company
estimates that its
cash holdings as of Dec. 31, 1955
will come to at least $14,336,000.

on

To raise additional funds it is pro¬

posed

to

offer each class of the
stock subscription rights

present
to additional
of

held.
the

The

shares

six

each

for

price

subscription
will

common

new

in the ratio

common

share

one

of

be

not

set

until the time of the actual offer¬

obviously it will be be¬
then prevailing market
price. With this sale the manage¬
ment estimates that by Dec. 31 it

ing but

the

low

have

will

cash

-the

dividend

that

the

above

somewhat

accumulations

but

would leave it
short of working cash. Thus, it is
payment

also

proposed

obtain

to

term bank loan of not in

million.

$6

would

loan

semi-an¬

three

in

mature

of

of

excess

unsecured

This

instalments

nual

short-

a

million

$1

changes

the

for

household

ter

appliances,

other

and

luxury charac¬

of so-called

items

long considered unwise
risky because such loans
not self-liquidating. It was

were

too

and
were

also

thought

that

buying

in¬

on

break down "tra¬

stalment would

ditional habits of thrift," was

"an

sin"

economic

&

Co.

Inc.

cates, maturing annually Sept. 15,
to

The

inclusive.

1970,

certificates

priced to
yield from 3.30% to 3.70% ac¬
cording to maturity. Issuance of
the certificates is subject to the
authorization

Commerce

were

of

Interstate

the

and

of

banks

it

that

was

com¬

short-sighted

were

is

will continue
to
stay at the present

or even

level?

Any sharp downturn would

create

a

be

to

secured

by
the following new standard-gauge
railroad equipment estimated to
cost

$9,601,637:
45 Diesel road
switching locomotives and 16 Die¬
sel switching locomotives.
Associated in the offering are:
R.
W.
Pressprich & Co.; L. F.
Rothschild
& Co.;
Baxter, Wil¬
liams & Co.: Gregory & Sons; Ira
Haupe & Co.; Wm. E. Pollock &

Closely

related

to

consumer

all

on

total

grand

United

about

$42

$117 billion

over

of this

March

the

from

increased

billion in 1946 to

by

mortgages

in

properties

States

of

year,

rise of

a

about

180%, which was due in
part to higher prices. The highest
rate of expansion occurred in res¬
idential ' mortgages,
particularly
on one- to four-family properties.

in the building of homes
by the war, the rapid
growth of population and families,

ing

up

delayed

and modern methods of financing.

provide

to

incomes,

and

particularly

mass

a

of

auto¬

the
other hand, were more objective.
Where
bankers
hesitated,
they
ventured as pioneers. They quick¬
ly developed services to provide
wholesale financing to automobile
dealers and retail financing to car

through

buyers

instalment pur¬
Their experience

chase payments.

during the depression of the 1930's
proved to be

satisfactory,

so

better

tainly

than

that

of

the

This

shared

billion,

the

field

with

views

vigor, particularly

since the end of World War II.
The record since the

that total

credit has

consumer

creased from

billion,

lion,

phenomenal

a

rise,

even

allowing for higher prices. About
billion,

$25
total

Commercial
of

lion

75%

over

or

in

was

held

banks

those who

bil¬

$9.2

which

made up

&

credit.

loans

consumer

this

of

instalment

It

12.6% of all their loans.
important for those who

is

already

this

in

are

are

field

mu¬

at

greater rate—by

a

since the

loan

war.

Savings and

and

associations

about

their

in

increase

a

mort¬

The

overall

expansion of home

mortgage debt and consumer cred¬
it combined has been much

more

rapid than the rise in the national
of

total

personal

the

since

taxes,

income,

mediate
this

point of view of im¬

results

plan

benefit

consummation

would

be

of

particular

Baltimore

to

of

&

Ohio,

holder of the majority of the first
prefererd stock. Baltimore & Ohio
would

from

receive $18,133,279

in cash
payment of the accrued di¬

vidends

on

the

it

stock

holds.

Fundamentally the liquidation of

Plans

announced today

for
the 27th annual Charles Hayden
Memorial
Trophy Golf Tourna¬
were

ment

which

Sept.

23

is

the

at

York's securities firms,

dound to the substantial benefit of

to

all concerned.

den, Stone & Co.

of

the

it is now, hold¬

As

two

junior stocks, the
.second preferred and common, can
ers

obviously not hope to participate
directly in the road's earnings no
matter

how prosperous

the prop¬

be.

Liquidation of the
arrears
would
put
the
junior
stocks in position to receive divi¬
dends, subject only to the level of
earnings
and
the
needs of the

erty

may

property.
tion

are

Students

dividends would

the

instituted

be

immediately
preferred but that

that

the

on
a

al¬

probably
have to be delayed until the bank
loan was paid off.
From the point of view of oper¬
ations and earnings the road is in
a

strong position.

It has tradition¬

ally been among the most effi¬
cient railroads in the country with
a

transportation

ratio

consider¬

ably lower and a profit margin
substantially higher than for the
Class
ther

I

carriers

as

a

whole.

Fur¬

improvement in this respect

has been noted in the current year




com¬

play as a memorial
Mr. Hayden, founder of Hay¬
Two-man teams

Allen
&

C.

DuBois

of

a

variety

Wertheim

Co.;

Henry Parish II of Carl
M. Loeb, Rhoades &
Co.; James
A. Edgar of Baker, Weeks & Co.
and

Wickliffe

Stone

&

mittee

Shreve of

Co.,

on

compose

Hayden,

the

arrangements

steadily to 42%

early

A

team

Co.

for

this

the

winner

of

the

The longer the ma¬
the smaller the down

purchased.
turity

and

the

payment,

LOS ANGELES, Calif.—Norman

are

now

Gordon

connected

B. Franklin &

F.

with

the

ex¬

such

Samuel

Seventh Street.

the

that

lenders.

the

of

risk

Small

Comptroller

of

the Currency and the

Federal Re¬
getting ready to
special iquiries into con¬
loans
by the banks they

Board

serve

make
sumer

examine.

are

We

are

assured that this

inquiry is not intended to imply
criticism

nor

to

of this

suggest

(Special to The Financial crtronicle)

PORTLAND, Ore.—Adolph U.
Wigren is now connected with
King Merritt & Co. Inc. He was
formerly with Foster & Marshall.

form

of credit

tightening

a

of

credit which would prevent sound

Nevertheless, it is

against

bank

of

credit in any type of lending
tributes

to

the

a

over-liberal

Overextension

billion

$208

se¬

early

instability

of the

51%

of

home

44%

1939

assets

ratio

debt

mortgage

in

liquid

The

year.

of

to

about

early

this

this

debt

to

is

key to the whole problem
banking and credit, of course,

stability of incomes. In the

ond

quarter
an

of

this

all-time

year,

high in

sec¬

we

per¬

sonal income of $300 billion. After

taxes,

consumers

billion

of

had about $267

spendable

funds,

and

spending has been running at an
annual rate of almost $250 billion,
with savings of about 7% of dis¬

posable

income.

These

are

fan¬

mortgage repayment over

the

old

method

almost

trouble.

If strictly adhered to,

since

analysis of this problem,

July

National

"Bulletin"

of

the

First

Bank reaches the
following two conclusions:
(1) "Towering as the present
consumer

City

debt and combined total

plus mortgage debt
when looked at alone, they
considerably less formidable
when measured against the growth
consumer

stability to the construction indus¬

try

the

and

It

have

in general.

economy
to

seems

bor¬

generally know the nature

rowers

or

overloading.

debt

But, I suspect, this is not entirely
of

true

a
great many consumers.
high-pressure salesmanship,

Under

themselves to go into
lending agencies so

total

current

disposable

income

(what's left after taxes) and read¬
ily
disposable
liquid assets
or
savings.
(2) "Most of the rise to date in
and

home

mort¬

debt has appeared merely

as

posable income and savings, after
lag due to World War II controls

over

credit and materials for

sumer

con¬

ability

goods and housing."
debt

to

assets does not

income
seem

and

liquid

to be alarm¬

ing but neither is the present evi¬
dence conclusive.
We have only
aggregate statistical picture but
we do
not have a significant ac¬
an

count

of

individual

borrowers

to

The result is

debt.

a

income

family

on

dissatisfaction with all lend¬
We have done little or noth¬

ing
to
forestall such unhappy
developments. Probably a series
of "Don't Overdo It" messages to
the consumer would be a desirable
undertaking for

to consider.

us

Competitive Relationships

of

Competition,

by

type and region, nqr do we have a

satisfactory indication of the qual¬

is

course,

a

force in private enterprise.
Banking is a prime example and
in no phase of it is there keener
great

There

contest

the

than in
accounts.

four kinds of institu¬

are

that

these

accounts—savings

for

directly

compete

and loan

associations, mutual savings banks,
commercial banks and

postal sav¬

eliminate postal sav¬
ings because they have been de¬
clining and at $2 billion they are
only about 62%
of what they
ings.

We

can

The

in 1946.

competitors

follow what is
At

the

accounts

o|;her three are
and

we

should

happening.
of the war,

end

savings

these three classes of

in

totaled

institutions

Commercial

banks

$52.6
held

billion.
in

time

deposits almost 57%, mutual sav¬
ings banks 29%, and savings and
loan associations about 14%.
By
April this

year,

these accounts had

more

than doubled, reaching about

$103

billion.

held

clined

The overall relationship of per¬
sonal

often

indebtedness

their

the

that

real

debt

of over¬

the meaning

extension

were

gage

we

edu¬

business

and

Banks

and limitations of borrowing. Both

are

consumer

here

that

me

real problem of credit

a

appear

personal

this
give

should

system

tions

the

of

short-term

of

maturities, which were
meaningless in times of

competition

of

great improve¬

a

mortgage

for savings

the war. Even
must not lose our perspec¬

its

ex¬

This is

rising

fast

lessening his

posure.
ment in

accumulated savings thus has been

a

The
of

and the lender is

in

con-' 'catching up' with the rise of dis¬

economy.

reached

Joins King Merritt

and

consumer

constantly is increasing his quity

ers.

to

The

amortization.-

of

and

from

In

the

Probably the most important
factor, particularly in the case of
home mortgages, is the principle

The proportion of consumer

rose

packing, discounting and inflating
selling prices through over-allow¬
ances on trade-in, always increase

practices,

wants.

this debt by using
liquid assets.
These

tive.

Stewart

Company, 215 West

1939

as

terms.

(Special to The Financial Chronicle)

in

so, we

Undesirable

warning

Two With Samuel Franklin

and

is

greater

posure.

transactions.

tournament last year.

Feeney

automobiles

as

appliances without

substantial equities in the articles

a

representing Wertheim

was

such

people who borrow and
in order to satismy their

reypay

test the consumers' abil¬

carry

credit

goods

to

ance

about

deposits, savings and loan shares,

tain

and household

vate and public pension funds/
hospital and medical insurance,
unemployment compensation, and
the like, have given greater assur¬

strain

long-term debt; nor should he ob¬

com¬

year's tournament.
&

with

himself

Moreover, the built-in stab¬
ilizers, such as the growth of pri¬

severe

1955.

wonder

second

distribution

would

common

will

perpetual

will be eligible to vie for
of other prizes.

situa¬

the

think

to

most

on

of

inclined

on

Golf

overload

pete for the trophy, which is kept
in

would

arrears

held

be

Baltusrol

Club, Springfield, N. J. Four-man
teams, representing many of New

re¬

dividend

these

to

maturity.

not

must

rent.

was

curities, increased from $50 billion

the

substituted mortgage payments for

debt to several

The borrower

From

housing, the growth of home;
ownership has for many people

they allow

and United States Government

as

ment and

in

total

in 1955.

consumers'

a

appliances, such as dishwashing
machines, refrigerators, and other

the

us

and

electrical

on

forms of mechanical devices. Even

service

rose

help

dependence

and

to

buying

household

of

domestic

on

greater

after

to down pay¬

Hayden Go!f
Tourney Announced

character

exceeds

Let

and

There is less dependence, for ex¬

The

war.

debt of these two items

ity

in

status, methods

habits.

32% of disposable income in 1939
it

changes

appreciate

holdings.

gage

must be sensible

27th

operation,

home

yardsticks

old

great

of

insur¬ cation.

life

showed

companies

ance

about

assets, consisting of currency, total

of two years.

servic¬

of

ing of instalment credit must be
skilled
and
prudent.
Its terms

Benefits to Baltimore & Ohio

the

income

amortization

186%.

or

Total mortgage holdings

and for

entering it to real¬

in¬

$5.1 billion to $14.6

tual savings banks have expanded

ex¬

panded six times to about $32 bil¬

expan¬

growth of 170%. Hold¬

a

four-fold

shows

war

mortgage

ings of residential mortgages

250%

their

credit and entered

this

ings in 1946 were over $7.2 billion
and in March,
1955, about $19.2

that

revised

in

Their total mortgage hold¬

sion?

even

consumer

social

ize that the initiation and

end

using

of

incomes

great

a

How have the commercial banks

mercial banks with business loans,
bankers

higher

with

represent

home-

in

change, and the direction of this
change continues.

cer¬
com¬

increase

unusual

ceed

the balance, not to ex¬
million, payable at the

of

ample,

credit is mortgage indebtedness.

each with

$3

careful
because

consumer

operations certainly has changed.

ownership

Co., Inc.; First of Michigan Cero.;
MciVTasW Hutchinson & Co.; Mullaney, Wells & Co.; F. S. Yantis
Co. Inc.

City Bank cautions us that in ana¬
lyzing this problem we must be

The

Mortgage Debt

The

family incomes.

real anxiety to all of us.

the
type of financing needed by the
rapid growth of population, of
unprepared

about

Commission,

issue

The

earlier.

This vast expansion reflects catch¬

truth

The

"im¬

almost

and

Sales finance companies, on

and
associates on Sept. 9 offered $7,500,000 of New York Central RR.
3%%
equipment
trust
certifi¬
1956

not

are

that the spend¬

tell

can

they

predicted

as

[incomes

grow

bank

in

Advances to consumers
purchase of automobiles,

lending.

mobiles.

Halsey, Stuart Group
Offers Equipments
Stuart

able

wrought truly

has

revolutionary

production,

Halsey,

off

consumers'

is accepted

and consummated.

Western Maryland
then decided to take steps to pay
■off the

and

figures

to

The study of the First National

The entrance of commercial banks
into

mercial

be

tastic

leveling

growth of consumer credit.

tacular

The dilution will
outweighed by

ly $9.60

the

case,

a

the changes in

to

v

the

of

case

moral."

was

plan

Rather than appeal

the

business loan.

the na¬
of business loans is the spec¬

Next

661,464 as contemplated under the
plan the estimated earnings this
year would come to approximate¬

improvement there would be
in the fundamental position of the

the Mahaffie Act did not apply

-turned down.

full

the

for

that
in

judged

was

that

1955 common share earnings
approximate $12.00 on the

may

7%

the

on

compared
With this start,

ago.

year

estimated

year

accumulations

the first

income for

net

re¬

about a

months this year

with
it

revenues,

of just

gain

a

in

seven

dividend

substantial

the

of

in

and

volume

sulted

is

Swift Growth of Consumer Credit

steady increase in

a

trafifc

in

steps to be taken
with the proposal

necessary

pay

which, with

in

or a

relation

Banking

But who

Maryland—Baltimore & Ohio

Maryland has'sent out

Western

it

mortgage

proxies
special

ity of the obligations. What we
really need for our guidance is a
good sampling of indebtedness in

13

page

New Frontiers in
whether

Western

Thursday, September 15,1955

/

/

/

But the proportion
commercial banks de¬

by

57 to 47%

from

and hold¬

ings of mutual savings banks from
29 to 26%, whereas those of sav¬
ings

and
loan associations
in¬
from 14 to 27^2% of the

creased
total.

What

are

difference

the

in

reasons

growth?

for

Why

this

do

people take their savings to other
places instead of commercial
banks that traditionally have been

Number 5464

Volume 182

The Commercial and Financial Chronicle

...

promoters of thrift and recipients
of savings?
One reason stands out. Savings

lowest of all districts. Most deposit accounts undoubtedly are

higher rates of

pay

interest, on savings accounts than
the coforfte'rcial banks. They can
do this because they are not

sub-

ject to income taxes to the same
degree that commercial banks are;

they

not under the

are

of earnings
vested

capital;

in-

co

pensation

not

on

they

and

under Lie

operate

pressure

and dividends

ment

legal

same

self-imposed restrictions

or

to re-

as

and liquidity as commercial

serve

is

banks

enact-

providing for

a

hour will

an

Within

terest

time deposits or sav-

on

jngs accounts also is becoming
item

expense

It has

of

increasing

unusua! meaning

an

an

us.

^n,a^aS.e!f^her5- ha.ve S°n? t0
2%. Most of the ether institutions

deposits in the Philadelphia Fed-

from 21/2%

paying

as,

savings

to 3%

on

apparently, they are

themselves.

.Several

serve

adjust their rates
to

order
proper

to

pay

out

2%

to

posits

banks

even

compete?

What

the

is

is

all

credit,

can

a^

that

rising
watch

of

income

of expense.

At the

of

strong

Fair and vigorous

cultivation

same

"0miCaly feaSiMe'

skms

tateSd

'

researeh

rr.ands is to mechanize
£jons

^be

£0

our

opera-

extent

greatest

pos-

technology,
sound
public
policy designed to create a favorable climate—these are among the

surrounds

powerflu forces for sustained ac-

capital

oping electronic systems, this

competition.

t

by your study

ti

4—tt

<rl

n

n

n r\ v\

4- 4

inri

4^ i

Li

rf n

f

aIii + i

f

of our economy that banking and

development of our communities,

own job becomes
of zest.

Another

the

for

reason

rapid

Bank

growth of savings and loan asso¬
ciations

probably lies in aggressive

advertising,

which

extravagant

claims.

makes

often

Perhaps

we

should fight fire with fire and

be

management is
banking and

Good

agement.
the

of

heart

a

the

of

man-

Droopr

ea

,

,

mattfals

,

i

or

me

..

.

.

worx

ne

manager

-

It is

ings.

our

..."

to

ca«e

j.

problem to present

our

the
,

,

people in

fair,
,

a

a

peupie

digmfied and vigorous manner.
We believe in

scund

be

competition must
fair, and the com-

and

maintained

opportunity
high level.

pe'titive
on

a

....

.

m

!•

3I1f

h

World War

smce

Drifcr
cu g,

known

firm

of

net

for

lower

ratio

nof

the

in

banks

Pennsyl-

vania, largely because their capital
funds
are
relatively larger
than

for tne banks

in

rest of

tne

a

cf consultants

management.

-

in

interested

a

ena within a small crystal, points
the way also to radical changes

devices.
,

.

,

,555?™^

challenging

challenge the accuracy

country.

Measured

in

terms

our

television receivers. It apnow

tube" in

th t
that

hnlkv rupture
bulky picture
electron "gun and

our

which

our

is being expand-

new

materials

skills,
was

and

a

<

and

engineer¬
electronic science

the
confined,

of

our

technology.
this

invasion al¬

ready are becoming evident in the
changes wrought by electronics

factory, the office, and the
—

home. But these changes, radical
as they may appear, give only a
faint indication of the astonishing
developments now brought within our reach by recent and continuing scientific discovery in the
area of new materials. Tomorrow's
systems, based on achievements in
the laboratory today, promise to
th" l^nratnrv
reshape many of our industrial

processes and business methods,
They promise to carry our national economy to even higher
tional economy to even hmher

tevels These trends, together
with the perfection of many new
dividuals.

far, we have responded with

enthusiasm to the challenge. In
ihe

areas

of communications the-

®ry and systems engineering we

Even greater
^i_

ev

promise lies, howof certain fer.
_

win

romagnetic materials to store information over

an

.

,

b

give

..

jd

mural tele-

us

be

£0rm

controlled

j*

t

jn the abmt

decorating

a

0| a
wall, and

remotely from
J
..

,h

jn,xthe ®0om

viywer
.

.

a

small
-

elsewhere

indefinite per-

a

assets, however, net profits

?vf,

phosphor screen ctic segregated at
oliccd are ocgit^ttu «u
ejther end, will give way, in the

sible the enlargement of the pic- circujfs>
t"re
s^'re?,n without lengthening vjsjon>
the tube itself.

period during the war and for iod and to reiinQUish this informasometime afterward industries tion jnstantly whenever it is reof Pennsylvania banks were,betcompeted with us for promising qUjred These properties have enter than those for the country as man power. But I think this situ-, abled ug to
deVelop compact and
a whole.
ation is changing. For erne
t^mg, efficient electronic memory units,
Earnings on loans naturally con- 9ur compensation nas oeen eaten- These units, equipped with thoustitute the
largest proportion of *ng u.p wl^n
ottered py in- sands 0f tjny ferromagnetic cores,
the

of total

in

pears

screen

We are attracting a high caliber
of men and women and we are
offering them opportunities for
advancement. It is true that for

have u„i
built

"en taking full -v..v....„0y
advantage
----opportunities offered by
£ulure to a thin ]ayer 0f electro- new materials. The pace has been
improved television picture tubes. iuminescen£ material within
(here is every indicaThe usemf ferromagnetic cores in whicb the same functions are tl0n that its swiftness will inthe deflection magnets whic
performed. This development, to- crease, and that our progress toguide the scanning beam in ou gether with the miniaturization of
breed further progress
television receivers has made pos- otber eiements in our receiving tomorrow. Clearly the organizaa

first

which it once did—at least,
jn proportion to the growth of
I

T

circuits. They also have p ayed
known significant role in development of

The

£ this statement.

sdmewhat

is

from

career>

banks."

This

letter

tr.n^storizer,

have enabled us to acnieve nij-n
well- performance in
in tne ppnen s c^sen

fact that the banking business no
longer attracts the high caliber

avpraged about 8% of capital accounts.

a

•

UMl

New

ReCerjtly',

received

I

.

potential

•

1U1

problem is how to attract,

a^d

we

Their

II.

and

managets and

rev-

these devices lies in viewing.
electronic systems for the home,
as
reliable
long
Electroluminescence with its promise above all to increase our
potential as reiidoic,
pnmhinntinn nf piprtrnnin nhpnom- enjoyment and well-bein?? a<; inlife, and compact sources of power combination of electronic pnenom
J ^
mm weii hieing as in-

tnen

Ipct
develoo them.
select and develop them. Recently,

men

banks have done

commercia

mana£?ers

paragraph states: "It is a
-

,

of buainess fina

met .oda

The

field

Within Our Walls
.+

^

,

lr;us.t ..have...g?af

•

portance of

relations P

>oa personnel
duuks.
good personnel in banks,

agencies. But

the standards of

rplatinns

wltj1jn an(^ without the bank. We
f

competition among

ourselves and other

vJL'IpH^p' nf hurmn
kl™wledge of human

devel_

hpvrmH

H

in—the

tubes, in an array of light-sensitive control devices, and in new

_

.

1_

_

„,hir>n we
which

The results of

sound

quality

nnnn
upon

£ast^
past,
horizon

areas

photoconductive and electrolumore aggressive ourselves in putagement determines the quality of
minescent materials in a single,
ting our advantages before the operations, assets, public relations techniques of electrostatic print- compact device, we have achieved
public. Our Educational Founda- and" growth of business" "
ing
*
~
"
electronic light amplifier,
tion is already preparing a leaflet
A
d mana2ement 'eU
Certain materials in this same Here, an image of extremely dim
to that effect. The committees on
~g<orelSzef iobsand selects general class are capable of con- visible light or of invisible ultralending and operations can assist S°ai£ °]rgaiizesjoos ana seiecis
^
ht ^ atQmic en_ violet hght may be mtensified
the legislative committees in sug^°'t team out oi its peisonnei, ergy directly into small amounts through two thin layers of these
neisonnel
°ul
sj
energv
From these materials to attain visible brightgesting
appropriate
means
for ^a ures iobs and DerfoJmance of electrical energy. From t*equalizing competitive advantages m„eaSTijT3
^e.rT™aneCoe'
we have devised
™S^e7ll else develop^ materials, we have devTed ex- ness and high resolution. Light
whenever unfair competition debrine* nut fhp hpst in them
perimental solar and atomic bat- amplifiers of this nature may soon
_
velops. But we must always reof themanaser
there.' teries, producing electric current permit us to gain increased utility
theremember that it is the people themworK complexmanagei,tasl^ H from'the uwu* of the sun and from from our radar our X-ray fluoro01 tne human inere r
„
out-,
fmm frmn our radar, our X-rav fluorofore Ys a
light
selves who choose the institutions
requires
TTTan understanding radioactive bombardment by scopes, and other devices which
to which they entrust their savexperience
skil" and genera! atomic waste materials. The im- today produce dim images for our
The

credit.

i

in the past,
largely to the field of communica¬
tions is, today, penetrating into all

Revolution in Materials

of any industry, lies in its man¬

as

these

ouT products and services in the
pro^cL^nd^s^vice/^n^hp

successful bank,

a

of

w.

our

that

Electronics Means

Management and Personnel

The secret of

mpanc
means

ing

0Derations

on

many

wealth of research

miuee on °Peratlons-

be reached.

can

mittee

vt

ing flow of

"ancTother S{.b'e/ ®sPe<;iaMy in view ofhhe
careful anal- ? or a||,S
"LTnge Tor our com- Continued from page 11
cecisions

i

hopeful and full

come? Answers to thes

questions require a
ysis
beiore individual

Thus, beneath the glamor which

™iBHiSJSKSUsrx;
••*">■"*SS5®^SSSfSPB

blnking "and To'' the

progressive

This

Conclusion

and

*

membership

our

us,

^nt

a

structures.

and

and

all leads to two major results: increased markets for present types
°f equipment because of decreased
size and complexity and new markets for newly conceived apparatus which were never before eco-

.

proved operations and administraMaintenance

We have be-

fore us the possibility of manifold increases in the number of
functions possible with electronic

comes an economic reality.

im-

through

costs

compactness.

means

But «iese developments need not
ociHF a
our private and
SubJ1C 8?llC!fs and plans are prl!?entl. W® have ma?y economic
frontiers that can insure prosperity wit out in 1 tio . Popula-

for dividends and for growth.

of

combined

power

0VD1IC+un 1 ^nce*

service

Development of competent bank

Control

of

use

might lead t° spec- tional complication, seen previulative plunges under the spurt of ously only as a vision, now be¬

to business.

fafr ie^

Small

with developments in automation
which are presently under way',

Pubkc relations and acceptance of and suggestions in each of these credit can make a fruitful contriEach
banking
In ^ age of autQma_ areas> Each committee is
committee is
t* bution viewed in tWg Ught> our
tion, one way to meet new de- force and its goal is important to

em-

rate

a

we

courteous

management and personnel.
Earningssufficient to produce

good performance makes for good

As merchants primarily

of short-term

are:

<•

What is

of withdrawals whicn affect prof-

itability?

rapidly

constantly

sources

avenues

Vfiwf n?ni°

nfG

with

must

we

cur

in

banks

these

has been done in the light
This gives us a simplicity that was previously inconceivable.
as

amplifier.

unbalanced fiscal policy may be limited only by a new frontier
use(* under pressure; and that the for invention and ingenuity.
In
Possession of large liquid assets other words, an increase in func-

in-

tion.

Confronted

costs,

and

Efficient

must

we

866

Among

to the people and

it.

rate for commercial banks
on savings accounts with¬

unduly raising costs?

among

li^e issue and

a

consider

savings de¬
2V2% in

on

or

was

common

wich,

27

expansion of credit; that in our equipment, within the space
drive toward full" employment, economic boundaries set for

your

banking

Building of sound earnings as-

Chicago districts being the lowest.

naturally

commercial

Jowest

the

1954

the re.
districts, with Cleveland and

This

questions

should

arise:

of

one

baV.in? iVw„ns!d,eraWe competition
among

District in

eral Reserve

of

many

the

all

to

We

sets.

size.

for

to

them.

province

"'

come

and credit matters of

The average interest paid on time

are

study

Pennsylvania.

Pennsyl-

in

the

committees

several pay brackets.

generally

conditions

new

must

we

accelerate upward adjustments in

resisted raising their rates
1% on savings accounts, al-

though some of tnem

law

have

We

many.^ol meet;

The

upward.

the

Interest

Corpmercial
from

of

are

minimum wage of $1

banks.

have

In Conclusion

The new frontiers before us are
broad and exciting. The present
picture, of course, is mixed. Like
those whose activities are -Cp^jy.have greater resources in our care; ah new situations, there is never
and entail losses. Every account - whfai*we do with them depends just black and white but always
should at least pay it own way. A upon the quality and skill of our many hues in between. Right now
fresh - inquiry into this subject management. We are serving more there is some indication of inflashould be helpful.
people and we must always re- tionary developments. There is a
On the expense side, obviously member that we are dealing not danger that our costs may rise
salaries and wages make up the only with their money but with faster than our productivity; that
largest item. The trend of com- their human wants and needs.
over-optimism may lead to over-

profitable, but there

loan associations and mutual

and

savings banks

(1091)

Use of Electronically Active
•

Solids

Many illustrations have been
given of the revolution caused by

the increased utility of electronically active solids. What will the

,

,

tion which makes the best and the
newer mate® W1^ ^ m the forefront of

^Vjlest use ot these

Pr°gress- tratornihr
10 an industry and to
rPQPnrr'h
4
?.research fraternity with a tradi
tion of
n

^

pioneering, this is

a

chal¬

lenge we face with confidence re¬
garding the achievements which
will be

ours.

New Reynolds Branch
STOCKTON,
w.,,

& Co. will

Calif. — Reynolds
vam.-xtcy.^us

branch office at
impact of all this be on the elec- 301 East Weber Avenue, effective
Anotner reason is .tnat represent a major advance over tronic industry?
The influences Sept. 20, under the supervision of
has been increasing. Income from the atmospnere in many banks nas previ0us storage systems in their caused by this new revolution in Edwin A. Robertson,
securities also has shown a tenha"glI?g l0* ^ability to "recall" any item of solids is^much greater than just
.
.
dency to rise, ov/ing partly to in- a9Pll.10n t0 3
+u
^
stored information within mil- that of a new device because it
With Cosmopolitan Inv.
creased investment in tax-exempt ottenng niany >otner Denems,sucn lionths of a second. Performance means a brand new outlook on
(special to the financial chronicle)
our

total

which

income

recently

ciustries.

°£

securities.
One

item

on

the

side

income

'

that deserves our attention is that
of service charges.

at

charges
the

all

Federal

for

counted

For 1954, these

member banks of

Reserve

about

System

6%

of

ac-

total

'

earnings. This proportion was gen-

erally higher at smaller banks—
abut 7%— than the 4.4% at larger
banks.

The proportion at member

banks in the

Philadelphia Federal

^uiance, oonuses, piom s a ing
KS
°

District at 3.6%

was




the

'

"

y

The whole field of banking as a
career is improving, and it is up
to us to continue this improvement., We have a good committee
of top. executives to probe-into this
subject. We msut develop, .an objective
program
for ,,selection,
training and development of our

*

Reserve

open a

people.

l!lis P,rd,?r is ®ssential for tbe what is possible For instance,
d solution of complex prob- the transistor makes a hundred-

lems handled by electronic computers. It ,is essential also for the
swift compilation of data in tomorrow's electronic business machines.
Through the phenomenon * of
electroluminescence,

we are

today

exploiting the relationship of elec-

trical and light energy in novel
developments of major significance for the future. By combining

BATON ROUGE, La. — T. S.
Barcelona has been added to the
fold decrease in standby power staff of Cosmopolitan National Ineasily obtainable in many equip- vestment Corporation, 2907 Laurel
ments. The ferromagnetic or fer- Street,
roelectric circuit goes one step
further. It requires, in itself, no
First Calif. Adds
standby power and uses power
(Special to The Financial Chronicle)
only when change is made. EfLOS, ANGELES, Calif.—Leo D.
fects which previously required
complicated equipment for their Bartelme Jr. has joined the staff
application may now be combined of First California Company, 647
in one simple material or sand- South Spring Street.

/

23

The Commercial and Financial Chronicle... Thursday, September 15,1955

(1092)

requirements,, contrary to
in each of the past

serve

Continued from first page

their
two

when such
a
step
helped the banks meet the antic¬
ipated large credit demands of
the Treasury and of seasonal bor¬

Tempering the Boom
Through Credit Restraint
throwing

Ca¬

Upon

Pressures

pacity—Economic activity has
been
rising
rapidly
for many
months, and there are signs that
industry is once again approach¬
ing
capacity operations.
Gross
National output has risen by 8%
since the latter part of 1954 and
is currently some 4 to 5% higher
even than in the peak quarter of

previous record year.
production, as meas¬

1953, the
Industrial

in¬
(1947-

by the Federal Reserve

ured

currently

is

dex,

140

at

49=100), or three points above
the best month in 1953, and there
ere

indications that the index may

be

understating the

in

put

recent

Employ¬

months.

record

to

week in manu¬
facturing is again above the 40hour
mark;
key industries are

levels;

work

the

operating at or close to capacity;
and the immediate supply of some
industrial

raw

materials is below
Business is

demands.

current

inventories at an accel¬
erating pace and accumulation is
expected to spread in the months
building

ahead.
-

therefore

is

It

surprising

not

months,

past

12

been

financed

In

that

indicate

20%

some

has

banking statistics

the

growth of

real
accelerated in

has

loans

estate

Although

months.

recent

debt during the

by the commercial

banks, and the

com¬

prehensive statistics are not avail¬
able, it is evident that part of the
rise
reflects a
rapid growth in
the "warehousing" of home mort¬

banks on behalf of

by the

gages

investors

institutional

who

at

them

repurchase

to

is

agree

future

a

building

date, presumably when
activity may be lower.

rise.in out¬

expanded

has

ment

in home mortgage

the banking system.

In the

1955,

instal¬
almost

climbed

credit

ment

of

months

six

first

by

$21/2 billion, mainly because of the
upsurge
in
automobile
paper.
Some of these demands are re¬
flected
in
the
sharp
increases
already noted in bank loans to
sales finance companies.
Direct
loans to consumers are also

bank

expanding considerably, although
somewhat less so far in 1955 than
in the
corresponding months of
the boom year 1953.

upward pressures upon prices
becoming
stronger.
Wage
rates are advancing sharply, prob¬

and instalment debt by

ably faster than the growth in in¬

are

that
are

dustrial

productivity, and produc¬
distribution

and

tion

Prices

mounting.
commodities
the

even

are

months.

of

cost

living

importantly,

Very

economic

current

the rise, and

increases in re¬

index has shown
cent

are

industrial

of

on

sluggish

costs

expansion

is

The

present levels of mortgage

though such debt is at record
heights not only in dollar amounts,
but also relative to total personal
The

however,

ally vigorous increase in private
As the economy approches

of

effective capacity operations,
is

there

a

real

continued

possibility that a
expansion of

rapid

credit

will

do

prices

than

to

bid

to

more

increase

up

physical

output.
Rising Demands for Funds—The
recovery
has
been most robust in areas that are

business

present

of credit, notably resi¬
dential building and automobile
sales.
The combined volume of

large

users

corporate, state and local se¬
curity issues has been running
somewhat below the 1954 level,

new

with demands for investment

but

funds

running ahead of the rate

of savings,

the commercial bank¬
ing system is financing an in¬
creasing
volume
of
instalment
buying, building activity and
business expansion. Loans of com¬
mercial banks jumped by $4 bil¬
in

lion

1955,
of

a

any

first

the

six

months

of

record for the first half
and loans have con¬

year,

tinued their rapid climb in recent

rate

at

is

indebtedness

sonal

being accompanied by an unusu¬
■credit.

themselves

probably not beyond the abil¬
ity of the public to carry under
current conditions of full employ¬
ment
and
rising incomes, even

income.

what

per¬

expanding,

sustained

be

can

which

clearly in excess

seems

over

a

protracted period.
Furthermore,
the sharp growth of private debt
has certainly
been accompanied

extension of maturities and
probably by some relaxation in
lending standards. Finally, when
the economy is surging upward,
there
is always some
risk that
by

an

optimism

stimulate

may

all, the shift toward a more
restrictive
general credit policy
has been quite unmistakable but
it
has
also
been
gradual
and
moderate,
the

from

is

an

over¬

extension of credit.

with

Under these

conditions, the desir¬

ability of imposing restraint upon
the

rapidly rising trend of eco¬
nomic activity appears to be re¬
ceiving
increasing recogni¬
tion.
And since financing needs

chart

that

requirements

un¬

Although

some

of the

in the early

increased borrowings

sary

Perhaps the most

reserves.

significant indicator of the grad¬
ual
tightening of credit is the
behavior of "free" reserves, i e.,
the excess reserves less member
bank

"free"

These

borrowings.

declined from

a

level of

$700-$800 million in mid-1954 to
negative figures in recent weeks,
indicating
that
borrowings are
larger than excess reserves. The
downtrend has been gentle and,
far at least, has

so

ried

not been car¬
of

extremes

the

to

1953.

However, as the chart clearly il¬
lustrates, Federal Reserve policy
has
become
more
restrictive in
said

that

part of 1955 reflected the greater
concentration
of
corporate
tax

the
demands

payments in the first half of

major

year,

the

have

come

loan

from light and heavy

and from sales finance
companies. Public utility compa¬
nies have also been heavy bor¬
industry

rowers

to

recently, largely in order

provide

new

financing

of

construction.

Another

ing

interim

debt

which

are

area

of rapidly mount¬

is in home mortgages,
rising at a rate indi¬

increase of more than
$12 billion this year, against a
$9% billion advance in 1954. Al<though the great bulk of mortgage
money is still being supplied by
savings institutions, demands for
mortgage financing are outstrip¬
cating

an

ping the funds made available by




credit au¬
moving to¬
ward
a
more
restrictive
policy
almost since the recovery of busi¬
ness
began to take hold in the
latter part of 1954. In the closing
months

have

credit

has

policy

moved

from

"active ease" to "ease" and even¬

tually to restraint.

of

part

Federal

the

other agen¬

and

Reserve

of

actions

recent

least for the time

being. The vari¬

steps taken in August to curb

ous

credit, while individually modest,

likely to have some cumula¬
effects upon the three types

tive

of

credit

ment

which

contributing

are

financing.

Increased Discount Rat e—The

discount

rate, which as a tool of
policy had been relegated
to the background for many years,
has staged a comeback in recent
credit

When, as now, the authori¬
provide fewer reserves
through open-market purchases,
member bank borrowings become
years.

ties

large*, more frequent and more
widespread, so that an increase in
the discount rate effectively raises
the

of credit

cost

the

to

banking

Economic

Recent

Restraints

Dec.

7, 1954: Federal Reserve
Open Market Committee for¬
mally

shift in open
policy from "active

approved

market

ease" to "ease."
Jan.

4, 1955: Federal Reserve in¬
creased margin requirements

from 50 to 60%.

1, 1955: Treasury offered 3%
bonds due 1955 in exchange for

April 14, 1955: Federal Reserve
began increasing discount rate
from

iy2 to 1%%.

of

increases

was

initiated

round

recent

in the discount rate

announcement by several
Reserve banks on Aug. 3 that they
by

an

raising the rate to 2%
fective
the
following
day.
exception

ef¬
An

the Federal Re¬
Cleveland, which
rate to 2*4%.
The

was

of

Bank

serve

its

increased

larger increase in the Cleveland
district presumably reflected the
remarkable strength of business
and credit expansion in that area,
which includes a large concentra¬
steel

of

companies,

automo¬

bile suppliers

and heavy industry.
August, however, the
movement toward
a
2*4%
dis¬
Later

in

rate

a

to spread to
result, there

began

other districts.
was

of

As

a

revival, at least for a time,

in

differentials

regional

count rates, a

dis¬

system common be¬

from 60 to 70%.

not

April 28, 1955: Veterans' Adminis¬
tration prohibited inclusion of
closing costs in guaranteed or
mortgages.

fective Aug.

tricts.
the

At

Reserve

has

time, the Federal

taken

various

addi¬

tional steps to curb credit expan¬

sion, and several branches of the
Federal
to

Government

have

acted

sured

down payments on in¬
guaranteed mortgages

and

points

percentage

two

and

maturities

maximum

shortened

out

the

of

though
reserves
were
initially
supplied
whenever required
to
prevent tightness in the money
market
Gradually, however, re¬
serves

less

were

freely.

discount rate

furnished

In

April

was

less

and

1955,

the

increased from

measures

mass

market.

maturities
insured

The

means

reduction

that

in

FHA-

on

houses
within
the
$10-$15,000
price
range, monthly payments are in¬
creased by some $5 or $6, or by
mortgages

on

about

9-10%, while on VA-guarmortgages, monthly pay¬
ments are increased by $4 to $6, or
by about 1V2%- This action also
eliminates the no-down payment
anteed

the
"no-down
pay¬
ment" mortgage had alreadwbeen
abolished late in April.
mortgages;

Since

down

the

increases

payments
are

both

in

in

monthly

fairly

modest,

and

they do not seem likely to cause

sharp contraction in residential
building. Also, the impact is like¬
ly to be delayed, since for projects
already under way or about to be

of

last

year

shows that the

weeks.

iy2 to 1%%, and a further round
of

increases

was

undertaken

August.

Furthermore,

thorities

this

from

summer

the

in
au¬

refrained

reducing member banks'

re¬

either from

Intensification of Credit Restraint
As

late as the spring of this
there was considerable un¬
certainty whether
the
Federal

year,

must

any

come

credit policy

general

from "moral suasion."

or

There is

little doubt that the upsurge in in¬
stalment

lending

considerations

the

among

was

induced

that

the

Federal Reserve to adopt a policy
of

general credit restraint.

In ad¬

"moral suasion" seems to
have been applied; the authori¬
ties have called representatives of
various consumer lending groups
to
meetings
in
Washington
at
which this problem was discussed,
dition,

and at the

banking

time the Federal

same

authorities
thorough

supervisory

initiated

have

more

examination of

operations

lending

consumer

commercial

of

banks.

for
consumer
credit have clearly become more
Lending

terms

In the

liberal.

of automobile

case

which has been responsi¬

paper,

ble for the bulk of the increase in

in 1955,

.

pay¬

have
gradually
36
months
and
more.
Also, the "packing" of both
new
car
prices and trade-in al¬
periods
to
lengthened

lowances

that

means

the

true

equity of the new car purchaser
is frequently less than stated on
the sales contract.
Although re¬
possessions

still
relatively
nominal, there ap¬
good reason to halt

are

low and losses

the

be

to

pears

trend

the

toward

ever

more

lending. The goal of the
credit authorities is not to check
liberal

further

instalment fi¬
check the

in

growth

rather to

but

nancing

progressive easing of credit terms
which
might
further
stimulate
the consumer durable goods in¬
dustries for the time being, but
which would

the real possi¬

pose

bility of a subsequent drop in out¬
put when consumer debt is being
consolidated

reduced.

or

Implications for Commercial

Responsibility

promoting

for

economic stability is not the task

If

aims and endeavors must be rec¬

ognized by the financial commu¬
nity, and the actions of the autho¬
rities must receive the day-by-

majority of. the labor force, by the
increase in earnings during the
past year or so.. Moreover,
gages
now

very

mort¬

maturing beyond 25 years,
out, have not bulked
lar^e in total home mort¬

ruled

of the credit

The present concern

authorities does not appear to be
directed

primarily to the level of

economic activity in the aggregate

which* though above all previous
peaks, is probably not placing an
undue strain upon total resources
of plant or manpower at this time.
Rather, the concern of the Federal
Reserve is with the rate of expan¬

sion; continuation of the advance
in activity at its recent swift pace
could well have unsettling reper¬

credit and business
Also, capacity opera¬
tions in basic industries and short¬
cussions upon

conditions.

of
creating
ages

a

undertaken since

months

action

The increase day support of the major pro¬
payments ranges between viders of credit, including particu¬
$200 and $300 on houses selling larly, of course, the commercial
between $10,000
and $15,000, banking system.
which
currently
comprise
the
Current Aim of Credit Policy—•

postponed until the higher down
payments have been accumulated,
imposition of eco¬ but this is not likely to be a real
nomic
restraint
has
proceeded barrier to home ownership. Nor
quite moderately and cautiously, are the increased monthly instal¬
especially in the early stages of the ments expected to be a signifi¬
business recovery, but
that re¬ cant burden; in fact, the modest
strictive action has been intensi¬ rise
in
monthly payments has
fied
and
accelerated
in
recent been
more
than offset, for the
closing

credit,

consumer

on

restrictive

has

specific

in down

temper the rapid rise

the

impose

to

from 30 to 25 years.

straint

were
conducted
"taking the slack
money
market," al¬

view to

controls

Problem

Reserve

authorities alone.

ket

a

authority

no

Credit

Federal

is to be effective, its

in eco¬ started, most financing arrange¬
nomic
activity.
The
foregoing ments have already been made.
catalogue
of
the
various
re¬ Some
home
purchases may be

operations

the

credit policy

instalments
same

Consumer

The

—Since

of the credit

by

Ad¬

marginal home buyers out of

the market.

increased

($822 million issued).
Aug. 1, 1955: Federal Housing Ad¬
Veterans'

1, the Federal Hous¬

Administration

required

&

is

ing Administration and the Vet¬

July 11, 1955: Treasury offered 3s
of
1995
for
cash
subscription

ministration

However,:

authorities

some

Banking

Ef¬

—

the authori¬
ties shifted away from their poli¬
cies of "active ease."
Open-mar¬
with

the

prevailed since April 1942.

Tighter Mortgage Credit

erans'

ministration raised minimum

the

restrictive ef¬
fect in the aggregate by keeping

fore World War II but which had

25,

of

out

The

1955: Federal Reserve
increased margin requirements

April

the

year,

action

likely to have

mate borrower.

count

($1.9 mil¬

maturing obligations
lion issued).

the

instalment financing

tion
Feb.

lending -activity.

gage

system and frequently to the ulti¬

were

been

of last

the

on

cies suggest, however, that credit
restraint is to
be continued, at

within

reflected

Consequently,

needs

The

ket.

Thus, it may be
the pait year

weeks.

recent

credit.

thorities

borrowing

private borrowers and the Treas¬
ury during the balance of 1955,
they
would take
steps around
midyear to ease the money mar¬

importantly to the boom—bank
loans, home mortgages and instal¬

thereby avoiding
those
weeks. In the first six months of
Aug. 11, 1955: Director of Defense
temporary spurts in demand
Mobilization
sharply curtailed
1953,
when
business was also which in the past have contrib¬
issuance of certificates of neces¬
rising to record levels, total loans uted to economic instability. The
of commerical banks increased by
sity for accelerated deprecia¬
goal of credit restraint at this time
tion.
less than $1.0 billion.
is not to bring about a decline in
Late Aug., 1955: Federal Reserve
The
bulk
of the increase in business activity and employment,
discount rate increase to 2V^%
bank loans is due to the larger but rather to reduce the chances
began spreading to other dis¬
requirements of commerce and of "boom and bust."
industry.

whether, in view of large

or

stantially in order to obtain neces¬

on

period,

con¬

mildly restrictive poli¬

are

down
payments on mortgages
in growing
by two percentage points and
the banking system
shortened maximum maturities
and, to a lesser degree, upon the
from 30 to 25 years.
credit markets, credit policy pat¬
Aug. 4, 1955: Federal Reserve be¬
ently can make a contribution to
gan
increasing
discount rate
this end. By reducing the avail¬
from 1% to 2% (2V4% in Cleve¬
ability and increasing the cost of
land district).
credit, it is hoped to limit current
economic expansion to a rate that Early Aug. 1955: Federal Reserve
held conferences on consumer
can be sustained over a protracted

being

are

pressures

tinue their

cies

would

authorities

Reserve

changed, member banks have had
to increase their borrowings from
the Federal Reserve banks sub¬

Expansion—

Upon

the

from

reserve

insured

Restraints

as
may
be observed
accompanying chart. It

evident

reserves

Soaring consumer credit finally,
also
adding to the pressure

upon

years,

rowers.

institutions; of the increase

these

actions

The

raw
some

materials
problems.

be

assuredly

Reserve

Federal

may

recognizes that action to restrain
credit expansion is not only gen¬

erally unpopular, but entails some
risk
of bringing about an eco¬
nomic downturn.
However, the
authorities are presumably equal¬
ly

that

mindful

alternative,

the

namely unrestrained expansion, is

probably

even

since such

a course

the likelihood of
turn

if

at

a

the

would enhance

a

rise

should

by

progressive

lending

terms,

speculation
by

the

credit,

Specifically,
instalment
to

be

fed

relaxation
if

and

should

easy

in

continue

credit
a

serious down¬

later date.

rapid

hazardous,

more

of

inventory

be facilitated

availability of bank
1

the

nrospect

of

a

subse-

Volume 182

Number 5464.;.The Commercial and Financial Chronicle

(1093)
quent

troublesome economic
downturn would become real and
serious indeed.

plies of

upward pressures upon prices of
industrial commodities, inventory

"

needs

Undoubtedly,
serve

the Federal Re¬
authorities hope that their

restrictive
far

so

credit

still

may

policies,
be

mated.

as

be

Also, term loans to finance

capacity but one may
whether, in the present en¬
vironment, .it might not be appro¬
priate to have such capital re¬
quirements financed to a greater
ask

longer period, but without revers¬
ing the upward direction of busi¬

degree out of savings rather than

therefore,

the authorities will continue their
constant
appraisal
of

through

ments in the economy and will be
sensitive to any real weak¬

of bank credit to retire

ing securities,

ening

quisitions

credit.

develop¬

most

in

business

conditions.

credit.

are

So

far, however, there

signs
in

no

of

slackening

doubt

business,

and the
authorities may therefore be ex¬
pected to maintain credit
fairly

tight, and
restraint

to

even

if

ing

impose greater

be

acting

environment, the

if

<

The

regarding

are

not

rather
of

to
to

halt

new

in

and to promote
greater
in

extending credit.

aim is to

growth

and

to

restraint

funds

goal

serv¬

to

i

a,.

discount

serve

SC1VC

rates

uutuuut

available

will
to

support

for
undertakings
conservatively financed,
the supply of goods and
.

on

Interest

discernible

some

anmi-

nounced, the "prime" lending rate
the
large commercial
banks

of

raised from 3% to

was

by

New

York

3%'%. Ini-

banks, this

was

generally
followed
throughout the rest of the country and brought the rate back to

credit

market

has

been

affected

a

Rates

effects

in

the

market,
reached

a

MARKET

and

highs

new

Throughout,

sup¬

In

year.

rates

the

for

u

,

i

.

a,

^ bank loans in the
°nn2 fil l 3ire
°
S? as h11811?683
3
nsingf
Pvn(wori
r^X : pokcy may h®
fiv?, ciHa
main on the restricu

u

r

jnf*

UDO

f t

iff'

?ug

^

already been
during the

«

as

X

_

1
Jtft
almost ff strong
credit

?^ffUr?S:

_+

Hnlvl

Dprsjqt

as

tightening of 1952-53, the

advance in
money rates and bond
yields has been orderly, and this

Jus^fies the hope that

a

squeeze

pro¬

be

can

Bank Loans — Recent increases
m bank lending rates have been,
relatively modest, and their restrictive effect upon loan demands
.

ln

small. Since

thc yields

Desnite the coincidence in

ing

the increase in the prime rate

not
appear
to
have
been
touched off by the rise in the discount rate- in fact
the first announcement
rate

of

hieher

a

nreceded

the

Federal

Re

discount v!te
Actulllv
banTlo
Weher mem'
borrow?nesrirminTilv
rates and other mo^v mar"

the

soaring

M

berbank

terest

k^t

'

factors had been

increase
some

in

secured
had

the

prime rate for
Also, brokers' loans

months.

by

been

customers

marked

these'rates
fncreased to 3 4 %
uf 5/

further

shortly
banks

rr

thereafter.

are now

j

+u

Undoubtedly,

still

are

u-ft.

well

4-

below

+

the shift trom

endeavoring to ad-

restrictive
markable

is

an

to

easy

credit

considerably

f

•

less

i

fairly

a

policy with

equanimity,

and

re-

there

anxiety

re-

RATES AND YIELDS

j

nTe^n

April

Low Month

August

1955

1955

IV4

1%

2%

D/4

,1%

Commercial

Paper (3 months)
Finance Company Paper (3
months)
Brokers' loans (customers'
securities)

3

3

Prime

Rate

3

3

Prime

3%

Bankers'

IV4

1%

2

(90

days)

Treasury Bills (new issues).

gether with

.65

(3-5 years)
3l4s__

Treasury 3s and
Corporate AAA Bonds

1.62

real

2.92

estate

3.01

2.40

terest

ate

2.62

take

(Moody's

/ M

FACTORS

for

/

3.00

^

/A
/

^

\

\

>

3,00

/

/
\

_

t

^

y

the

However,

time,

sizable
and

the

if

credit

of

area

restraints

consumer

credit,

moral suasion

applied by the Fed¬
eral Reserve may be mitigated
by
the
pressure
to
liquidate
the
large stocks of 1955 passenger au¬
in

dealers'

hands;

this

will

A
/ V

\
\

in

mortgage financ¬

some

pace

the

tomobiles

(monthly)

therefore,

new

hold.

In

AAA

b2

some

banking system will still be called
upon
to
provide financing for
building activity and home own¬
ership, albeit presumably at a

3.50

Corpoj

of

required.

lesser

/\

may

to

easing in the level of resi¬

persist

(monthly)

year.

generally,
contribute

to

demands for mortgage money will

AND YIELDS

3.50

help

may

Also,
less
liberal
terms, and higher in¬

rates

eventually,

ing

3.10

2.26

mortgages,

loans.

amount

3.01

2.85

,

dential starts in the months ahead

2.72

2.60

Bonds

market

*
P081"™8;

the

to hold down the growth of real

and

1.88

2.39

are

report that the
Federal Reserve has criticized the
growing practice of warehousing

modest

21/4

1.69

Governments

RATES

interest

accumtoation

o r v

expected

3 V2

Municipal

t

mortgage
1954

Type of Security

Acceptances

and

lively to keep business loans on
an upward course
during the lat-

estate

Prime

term

their 1953 PeakS- Market senti" ter part of the year.
^ent, 8° ^ a* least, has faced
^ghte^ £es*rve

well.

as

time, market yields of all

maturities

just rates charged other borrowers

above the 2% level in effect

that

at

to

theprime rate-

on

short

a

are not importantly held by com- securities market. Also, the less
mercial banks"
easy availability of bank credit
Although the prime rate is at could operate as a damper upon
the level that Prevailed during the excessive business optimism. On
' stringency of 1953, and balance 1
discount rates m August began to
move

securities

from 3%

up

tbe aggregate is likely to be
many bank loans are

f°r

gse than yielda on long-term be importantly swayed by the
Government bonds, and yields on higher interest cost. However,
long-term G o v e r n m e n t s have some large borrowers may seek
firmed somewhat more than the to raisc more funds either in the
yields on corporate bonds, which commercial paper market or the

nrime

serve's statement reeardine action
on

Furthermore,

Government securi-

on

ties in the "bank ranSe" (three- charges are a deductible expense
flve year maturities) have ex-ior income tax purposes, busiPerienccd a considerably greater oess. borrowers are not likely to

tim-

does

ear¬

have

the

however,

*

money

yields

nrevailerf

than.prevailed*

f

April 1953 to March 1954.

have been raised and credit is less
lier

29

The Outlook

more sharply than the market for

upon

was

5-

*

longer term funds.

banking conditions. Lending rates
freely available than it

garding the future than
in 1953

the levels that had prevailed from

con¬

lending
to

were
wcic

idica

_

well—will

as

credit

The gradual tightening of credit
so
far this year has already had

ate levels for inventories
may in¬
volve difficult problems of busi¬

MONEY

3,

U. S.

Determining appropri¬

in

be

Effects

ciples will raise many borderline

as,

a

by assuming that

services, and are supported by
appraisal of demands.

conservatively expected sales. Ob¬
viously, even these basic prin¬

sales, tight

or

realistic

instances where stocks are
deficient in the light of actual and

judgment, especially

obligations,
Since the pressures posed by
expanding loans and restrictive
credit policies have had their most
direct and immediate impact upon
the banking system, it is understandable
that
the
short-term

of

Aug.

tion

stabilization—

banking

Reserve

are

add

marketing of

period of rising

the first increases in Federal Re-

level

were

purposes,

served

to

bank

that

those

ness

be

tinue

up
A

inventories, and
finance inventory
building in

questions.

ward as business recovered. The
nvnrt
;n.iu.i
chart
further
illustrates
that
short-term rates are much more
volatile than those on long-term

x

important

not

made

to

mid-1953, the
last Previous period of rapidly exPending
business
activity
and
credit restraint; they followed a
declining trend during the ensuln2 business sag; they moved up-

raised

are

sec-

in turn, has
'
bearing upon the
bank lending rates.
On
1955, the same day that

:

__

the

loans

^rom mid-1952

of

The cost of reserves,
an

do

creditworthy bor¬

economic

Federal

crops,
to finance the seasonal
accumula¬
tion of business
to

of

best

Consistent with this general ob¬
jective is the extension of credit
to finance the

reserves

of the economy. The

course

through* borrowing from the Federal Reserve, through
purchasing
Federal funds, or through sales of
Treasury bills or other securities.

force

to

sound

to

and of good

prices.

con¬

for proper enterprises. The

rowers

bank

of

productive

deny

effect

call

a

liquidation
for

in

now

constitute

credit

bid

may

time, it is neces¬
to keep in mind that the rel¬

ly toward "productive" undertak¬
ings, i. e., transactions that will in¬

simply

good

a

same

credit be channeled
predominant¬

ices

whether these

irrespective

atively moderate policies of credit

selectivity

the flow of goods and
rather than

is

supply of credit

the

sary

generally

crease

there

of

At

endeavors

that

incomes

as

fostering somewhat great¬
discrimination in making loans.

er

The ultimate

ensure

reverse;

confident,

the

guide-

moderate further

the

advance and busi¬
sentiment becomes increas¬

fect

However,

standards

ex¬

sequently have the wholesome ef¬

lending but
the raising

encourage

lending

lending
more

business approaches new
Actual practice, however,

ingly

authori¬

specific

"flexible"

earnings

ness

it, stock market credit and ware¬
housing of mortgage loans, but
they have not expressed their
posts for lending policy.
it is evident that their

A good case can

chance that this optimism will be
reflected
in
the
evaluation
of
credit risks. A gradual tightening

ties have expressed some concern
with reference to
instalment cred¬

views

for

of

system,

ref lected

?nd chart shows that all classes of
interest rates advanced sharply

cost of reserves to the commercial

banking

have

years

changes in credit policy, which in
turn has taken its cue from the

important
consequence
of
tightening credit is the increased

tiated

downgrading

it did in 1953.

as

Adjustments in Lending Rates—

action

a

Interest Rates—Interest rates in
recent

An

little

as

often

and

important' implications
lending activities of the
banks.

or

made

peaks.

carry

commercial

is

standards which become

endeavors of the Federal Reserve
to limit credit
expansion obvious¬
the

there

are

terms

teriorated,

Federal | Reserve
anxious to avert a

the

credit standards.

Implications for Lending Policy

ly

that

authorities

should indicate the need for fur¬
ther action.

for

ac¬

will

progressive liberalization of lend¬

underlying conditions

—In the present

bank

to facilitate

or

which

Furthermore,

imminent

any

of

On the other hand, the use
outstand¬

probably
not mean a significant increase in
output, are not consistent with the
objective of limiting credit ex¬
pansion to "productive" purposes.

A

leveling off in total activity, even
a
decline, might well
prompt a fairly significant easing
without

of

expansion

an

conditions have remained
orderly,

and market sentiment has not
de-

overesti¬

productive

down the rate of expansion to one
that appears sustainable over a

Unquestionably,

to

acquisition of machinery and
equipment wil, ultimately, add to

moderate, will succeed in slowing

ness.

tend

may

the

which

described

basic materials, and

some

/

.

_

"/•'v

supply an incentive to continued easy financing. Gradually,,
however, the self-interest of
lenders may be expected to op¬
erate

Per cent

against

continued relaxa¬

a

-

Pr

26.0

24.0
Reserv

t

Requirenents-Central
Reserve

2.50

Cities —»

22.0

1

h

Millions

-

-

/ \<

y »500

AAr*
/vY
'

»

v

'

\

■A*

(

/

"JrU.

l/y.

f

\

\

Vv/

f

:

\

$

Re serves

14.0

1
♦1,000

13.0

/

♦1,500

New

Treasury Bi

~

either

next

few

loan

J

;

vide

some

that

a

i

t

.

1

1

i il-L

1952

l

.

1

.

*

t

.

1953




1

t

1

r

_>_i

J

11

1954

market

money

market

tighter

through

purchases, since
conditions would

become

than

the

considerably

authorities

thought to deem desirable.
1

1

1

a_A1

1

1.

1

A.

1935

A

LA

A

.50

-i

1

1

1

1

1

1

1952

>

1

1

4

•

».ii ii

1953

1111

•

i

11

11

1

1954

1

J

1

1

1

«

1

1, l

1

1

1955

1

1

A

>

.50

the

Federal

will

Reserve

reserves

some

otherwise

1

the

assistance to the Treas¬

Federal

the

furnish

10.0

c1
11

together with

in new money financing ex¬
pected in September-October,, are
likely to increase the amount of
required member bank reserves in
the months ahead.
It is expected

}

■■/

is rising.
Policy—Rising

ury

open

■

Reserve

demands,

'

.

fi¬

and

prospect that the commercial
banks will be called upon to pro¬

11.0

Reporting Banks

influence

months, while the vol¬

of repayments

Federal

12.0

)f N.Y.

dealers

mands for instalment credit in the

_

1.00

Loans

to

companies or directly to
consumers.
In addition, seasonal
forces may help to slacken de-

1.50

Billions

-

some

retarding the expansion of bank

ume

1.50

/"Free"

coupled

nance

0

♦500

authorities,

undoubtedly be of

2.00

|♦1,000

on

witb general credit restraint, will
in

18.0

The expres¬
the part of the

terms.

concern

monetary
2.50

y 3-5 yr. Govts.

r

'

of credit

sion of

20.0

Member Bank Bor rowings

i

V

tion

loans

♦2,000

*♦1,500

Long-term Govti

k

Reserve

Continued

are

With

Jollowing
on

a

pacje 3Q

30

The Commereial and Financial Chronicle

(1094)

Continued from page

Continued from

29

So,

5

page

The State of Trade and Industry
Labor Department.
of $71.06

average

Restraint: Reierson

Personal

000,000
restrictive credit policy,

however,
the outlook is that only a portion
these

needed

provided

through

operations;
ber

will

from

be

increase

to

the

Federal

pointed out,

fur¬

Steel

banks

banks.

continue

to

to 20%

further

even
serve

could

if
to

were

done

the

at

in

Federal

time

of

1953.

Producers

weather
are

top

the

discouraged

its

bor¬

distributing

Interest

Rates—The
interest

of

months

ahead

in

the

at

in

tions

sparked by

million

$200

upturn

from

the

absence of

in

crease

savings

the

accumulation

institutional

with

the
to

that

the

have in

and

an

mindful
in

market

at

of

the

hazards

Regardless

they

the

hold

be¬
are

inherent

of

credit restraint to be adequate or
to

come

the

regard

screw

as

another

turn

indicated, they

be expected to act fully as
as

in

1953

to prevent

acute strin¬

of

avoiding

The

such

a

in

the

past

two

years

as

both the Federal Reserve and the
financial community have

experience

and

familiarity

the operations of

policy.

ket

a

measures

place

is

with

flexible credit

Nevertheless,

of credit

gained

the

upon

always

impact

the

greater

thorities

nity

can

or

than

difficult

the

either

financial

the

to

au¬

commu¬

readily anticipate at the

present time.




force

him

one

bad

a

to

warehouse

big orders for the
steel coming in

markets,

channels

furring

shapes,

special

and

of

result

a

the

in

rise

domestic

prices

this

which found business ihore attractive
now able to advance tneir prices in this

mills,

are

profitable levels, states this trade weekly.

more

Although steel deliveries should be larger in the fourth quar¬
Metal consuming plants will be past

ter, consumption should, too.
the

obstacles—vacations and hot weather—as the steel mills.

same

Also, the biggest single consumer of steel—the automobile indus¬
try—will be in volume production again—after the 1956 moaels
out, "Steel" points out.

come

Consumers' inventories of steel continue to attract close atten¬

though many users say they don't have enough steel.
steel deliveries are behind schedule, consumers will
continue to order. But as soon as consumers can get steel immedi¬

As

even

long

as

It's generally conceded that some steel inven¬

ately, what then?
research

eight

way

on
of

critical
heavy

Plates and structurals

of

manager

steel company believes it will be six to
inventories can become worri-some,

one

before

months

such

this trace magazine declares.
American

The

Institute

Steel

and

Iron

announced

that

the

operating rate of steel companies having 96.1% of the steelmaking

capacity of the entire industry will be at

capacity

for

2,295,000

tons

93.8%

the

beginning

week

ingots and

of

steel

of 95.1% of
1955, equivalent to
for castings as compared with

Sept.

average

an

12,

(revised)

and 2,264,000 tons a week ago.
industry's ingot production rate for the weeks in 1955 is

The

based

annual

on

For

the

duction

capacity

like

week

2,176,000

125,828,310

of

month ago the

a

tons.

A

year

tons
rate

as

was

the actual

ago

of

Jan.

1,

1955.

90.2% and

weekly

pro¬

production

placed at 1,583,000

was

combination

a

as

will have

little easier to get from Europe than they

a

is

European

other

of the

rescue.

in

with

sheets,

crisis this fall and winter.

<^tons or 66.4%. The operating rate is not
because capacity
was
lower than capacity in 1955
percentage figures for 1954 are based on annual capacity of
125,330,410 tons as of Jan. 1, 1954.
comparable

The

and outstate auto
a

plants will

Electric Output Declined Further the Past Week
The amount of electric energy
and

soon

begin recalling

bid to make fourth-quarter production the

their

to

12

within

model

the

six

said

cars

last

producers

week

and

were

the

in

number

next

United

States

car-truck

100,837, despite the holiday, compared with

estimated

was

"Ward's"

30 and will

added,

at

output steady
the week

has

commence

been in factory changeover
body framing 1956 models in

1956

The

reporting * service added that three car makes—Ford,
Mercury and Lincoln—will have introduced their 1956 model cars
by Sept. 30, with seven additional producers to bow
during
October.

At least five

their

new

cars

car makes, in a concentrated
rush, will announce
during the week of Oct. 28-Nov. 4, "Ward's" de¬

clared.

The statistical agency counted
6,514,000 car and truck com¬
pletions in the United States for the year-to-date
period, virtually
equaling the 6,532,159 produced in 12 months of 1954.

1955,

already

is

and trade inventories at the close of July were
placed by the. United States Department of Commerce at
$78,300,000,000, or the same total as at the end of June, but was almost
mOre

of last year.
The

the end
June but

than

businessmen

held

at

the

end

of

.

parable
in

1954

Department

of

week

cotton surplus.

Car

Fourth-quarter
says

availability of steel

won't

as

poor

as

it

"Steel," the metalworking weekly, the current week.

It appears

disheartening, it adds, because mills restricted their
bookings for that period. But mills plan to ship more steel in that
quarter than in the third.
for the fourth period in an

2,192,000,000

or

15.3%

kwh.

10,703,000,000

the

over

tie

com¬

like

week

Loadings Moved Mildly Upward the Past Week

Loadings of

revenue freight for the week ended Sept. 3,
1955,
increased 2,215 cars, or 0.3% above the
preceding week, according
to the Association of American Railroads.

Loadings

for

the

week

increase of 105,700

1954 week, but

endedSept. 3,

cars, or

1955, totaled 794,192
15.4% above the corresponding

decrease of 4,888 cars, or 0.6% below the

a

sponding week in 1953.

U. S. Automotive

corre¬

•

Industry Preparing for Record-Breaking
4th Quarter Production

The

automotive industry for the latest week, ended Sept. 9,
according to "Ward's Automotive Reports," assembled an
estimated 84,820 cars, compared with 85,851
(revised) in the
previous week.
The 'past week's production total of cars and

1955,

trucks

amounted

to

100,837 units,

or

increase above the

an

pre¬

ceding week's output of 174 units, states "Ward's."
This

reporting service added that "the Detroit area and outstate auto plants will soon begin recalling workers in droves in
a bid to make fourth
quarter production the mightiest in history."
Last

week's

during the week.

output declined below that of the previous
while truck output increased by 1,205 vehicles
In the corresponoing week last year 69,741 cars

and

were

car

13,006 trucks

assembled.

Last week the agency reported there were
16,017 trucks made
States.
Tnis compared with 14,812 in the previous

in the United
week

and

trucks.

13,006

In

and

1,124

and

314

a

ago.

year

output last week

the

previous

trucks,

placed at 3,200

Dominion

for the

and

was

week

plants

comparable

1954

cars

and

built

3,893
week 1,633

801
cars
cars

trucks.

Commercial

industrial

and

failures

,

205 in the
holiday-shortened week ended Sept. 8 from 215 in the preceding
week, Dun & Bradstreet, Inc., reports.
However, failures were

considerably higher than
when

there

a year ago

131, and they

were

dipped

to

when 168 occurred

came

close to the

or

in 1953

prewar

toll of

209 in tne comparable week of 1939.

Failures
182

from

involving
and

181

week's decline

ities

under

year

ago.

of

was

liabilities of $5,000

exceeded

last

year's

or

more

of

total

140.

edged up to
All of the

concentrated in small failures involving liabil¬

$5,000, which fell to 23 from 34 last week and "28 a
Thirty businesses succumbed with liabilities in excess

$100,000, jumping from 16 in the preceding week.
trades

and

services

accounted

\

the

for

dip in failures
during the week, with the toll among retailers down to 83 from 93,
among wholesalers to 27 from 33 and among commercial service

of Capacity
be

kwh.,

>>

The

Steel Output This Week Set at
95.1%

and

1953.

up

Department estimated that about 13,000,000 bales will be needed
to meet domestic and
export requirements in the marketing year
that began Aug. 1. As a result the
improvement in production
prospects lessened the chances of any substantial cutback in the

looks,

1,347,000,000

Business Failures Ease in Labor Day Week

Agriculture has recently
its forecast of the 1955 cotton crop to
12,873,000 bales,
increase of 145,000 bales over its forecast a
month earlier. The

stepped
an

States

Edison

decreased 551,000,000 kwh. below that of
at

.

Department estimated the value of retail inventories at
of July was
$22,700,000,000. This was $100,000,000 below

United

the

July

$900,000,000 higher than July of last year. On a seasonally
adjusted basis retail stocks in July were about
$150,000,000 above
the previous month.
The

to

above

Canadian

Manufacturing

$1,500,000,000

according

week by 1,031 cars,

■

Car output at
5,646,000 units thus far in
beyond the 5,509,550 totaled in all of last year.

kwh.,

kwh.; it increased

,

models.

car

10,155,000,000

the previous week, when the actual
output stood

mid-September.
Thus the end of
September will find all car producers ex¬
cepting several General Motors Corp. divisions, which will then
be starting their shutdowns for
changeover, in production of the

distributed by the electric light
ended Saturday, Sept. 10, 1955,

week

Electric Institute.

100,663

three-week changeover period.

a

industry for the

power

This week's output

Reports"

1956

mar¬

anticipate; fluctuations might well
be

his

are

confronted

Automotive

of

Plymouth,

stringency have improved consid¬
erably

car

area

since Aug.

rapidly

gency in the credit markets.

prospects

of

may

will

to

come

rolled

in the industry's daily output
lightening-like pull-out from moael

„

rea¬

degree

freight

pected to end

of whether

current

cuts

themselves

are

hot

are

This

been.

cars, an

repetition of the 1953 "credit

a

squeeze."

expected to

are

Meantime, Hudson and Nash will resume car output next
Monday, ending a four-week shutdown, with Packard also ex¬

authori¬

yields

The

of

products,

mars

country to

before.

of

orderly fashion and

the list.

on

changeover by Ford held

if necessary, desire to have inter¬
rates

allotment

place

they

tory—although small—has been built up this year. The commercial

"Ward's" in noting an increase
the past week, said a

rate

ties, while ready to tighten credit
est

already

three weeks in a prelude to a
projected 1,970,000-unit production target for October-December.
The industry's peak
fourth-quarter yield is 1,668,227, attained
in 1950.
The closing three months of 1954 netted
1,386,957 cars.

inves¬

time, there is

same

assume

a

wiU swell

ahead.

At

his

They

"Ward's

underlines the prospect of
continuing tightness in the money
and capital • markets in the pe¬

son

Hot

up.

mills

no

warehouses

production

tors,

riod

in

cuts

in

mightiest in automotive history.

corresponding in¬

a

be

workers in droves in

the

Finally, the pressing bor¬
rowing reqirements of state and
local authorities are likely to sup¬
port the volume of municipal fi¬
nancing at a fairly high level
despite some postponement of is¬
sues
in recent weeks.
Mortgage
financing will also be at seasonal
highs. This outlook, coupled with

will

Detroit

drums.

an

The

with

sharp
dol¬

a

summer

favor.

wire

summer.

especially critical at the warehouse level. The situation in
plates has reached the point where the railroads' ambitious carbuilding program is in such dire straits that tne country is faced

GMAC

issue, is showing signs of

catching

some

wished,

are

$650 million ATT is¬

a

the

and

sue

are

and

orders and delayed deliveries from the mills.

financing,

new

drastic

.

obliga¬
commercial banking

Corporate

system.

customers

products.

Government

the

of

in

increase

some

of

them

their

the last four months of this year. It
the busiest and toughest periods the
industry and
have ever had to contend with.

buying if other mills don't

resulting action of the credit
authorities. Although recent credit
restraints will probably help hold
bank loans below the levels they
might otherwise have attained, it
is evident, as already noted, that
the latter part of 1955 will still
bring sharply higher demands for
bank
credit.
In
addition,
the
Treasury is expected to raise some
$4 billion of new money and this
entail

behind

are

in

of

one

tightest items

the

holdings

problem, but the mills

a

vacations

•

the movement of the economy and

will

working

tory-building upfl be a strong factor and the log-jam of backlogs
still has to be broken, continues this trade
authority.
Meanwhile, customer relations in steel are getting worse. The
purchasing agent of a Midwestern manufacturer is openly resentful

pro¬

found

be

something

letup in demand from any of the major
The automotive industry, particularly, will
be scrambling for every
pound of steel it can lay hanus on. inven¬

key to the

rates

will

be

have
.

tion,

have

consuming industries.

portions.

behavior

finally

above-capacity operating basis.
orders, states this magazine,

There

rowings, and the surmise is that
they are not likely to do so unless
borrowings and credit expansion
more

expected, "Trie iron age," national metal

previous period in

any

authorities do not appear to have

assume

are

Steel output and

credit

bank

and

an

on

will

member

gap

demand, but they are still running 10
result, backlogs continue to grow and heavy

a

1956

Maintenance is still

Re¬

as was

the

merchant

reinforcing

and

will be difficult for all.

mem¬

Currently,

all-out effort to close' the

an

"

T..e drive to bring deliveries into line with
promises is twopronged, it adds, the factors being top-speed production and drastic
slashes in allotments. The period from now until end of the
year

carried

discourage
borrowing,

ber banks from

squeeze

the

be

As

7^'^ "

weekly, states this week.

in

the Federal Reserve, will
presumably lead to some addi¬
tional tightening in the lending
policies of the banking system.
restraint

behind.

making

are

production

carryovers into

debt to

Credit

high of $304,700,Department of

States

was

also higher, but farm income declined;

were

producers

between

higher discount rate, to-^
gether with the general disin¬
of

This

new

United

$3,100,000,000 above the June rate,
$17,600,000,000 higher than in July, 1954. The increase over
was
ascribed chiefly to wage hikes for the
government's
civilian
employees.
Private industry payrolls, the Department

The

clination

further

a

June

borrowings

Reserve

to

during July, the

and

be

mem¬

required

their

annually

they

though the fourth quarter is three weeks away, steel
ingot production is climbing, now that vacations are practically
over and cooler weatner is here.
Ingot ouput in the week ended
Sept. 11 was 93.5% of capacity. That's a 1-point rise over the
preceding week, which was the highest since tne end of July.
Steel consumers can look not only to domestic mills for im¬
proved deliveries but also to imports. In the Soutn and Southwest,

week.

income climbed

couldn't

consumers

as

old orders.

on

Even

A year ago, factory workers were
making an

a

Commerce reported.

market

open

consequently,

banks

ther

will

reserves

some

quarter

that period

Tempering the Boom
Through Credit

of

if

even

fourth

Thursday, September 15,1955

...

They are restricting their order intake
attempt to become current in deliveries.

establisments

to

17

from

20.

While

steady at 29, those in manufacturing
concerns

failed

than

last

year

construction
rose

to

failures

49 from 40.

in all industry and trade

held

More
groups

except retailing.
Four

the

of

the

nine

Middle Atlantic

regions reported mild

States

where

the toll

decreases, including

dipped to 76 from 77

Volume 182

Number 5464

The Commercial and Financial Chronicle

...

and

the Pacific States,

were

20

occurred

from

In contrast, failures

Food buying increased
noticeably the past week with house¬
wives spending considerably more than
they did a year ago. The
total volume of butter and fresh meat sales

in five

week

regions; the East
Central toll turned up to 28 from
26, the South Atlantic
from 19 and New England to 15 from 11.
More failures

North
to

down to 40 from 57.

slightly Heavier during the

than

1954

States.

in

No

a

year

the

There

in six regions, with notable upturns
Atlantic, East and West North Central

change from

last

appeared

year

in

the

East

Central States.

Iwo regions, New England and Pacific
fewer failures than in 1954.
/

merely the
be¬
diversified enough to be an
effective
competitor or diversi¬
fied enough to survive.
means

expanded appreciably.

ago

Middle

seller enters. Others

was

frozen
crease

in

continued

a

Fresh fruit and vegetable
trade.

retailers reported

in¬

an

Apples, peaches and cantaloupes moved well, and
tomatoes,

_

beans

green

and

corn

popular.

were

in

do

canned

The

There

price index, compiled by Dun & Bradstreet, Inc., turned higner last week to register $6.19 on
Sept. 6.
Tnis compares with last week's
figure of $6.15, wnich represented
the lowest level in 31 months.
The current index at $6.19, con¬
trasts witn $6.70 on the
corresponding date last year, or a
7.6%.

of

Commodities

quoted

higher

in

the

past

week

were eager to replenish low stocks.
Department store sales on a country-wide basis

Retail

oil, eggs and raisins.
31

foodstuffs and

raw

flected
total of the

sum

price

pound of

per

like

in

meats

Reserve

Board's

index

for

the

general use and its cnief function
is to show the general trend of food
prices at the wholesale level.

trade

period
to

year

a

in

New

increase

It

York

of

should

the

above

past

week

that

hurricane

ago.

among
firms
will
effectively competi¬

an

the conglomerate sort.

law

be

I

them

this

cannot

enacted

as

The

weather.

of

mergers

covered,

the

According to the Federal Reserve Board's index department
store sales in New York City for the weekly
period ended Sept. 3,
1955, aavanced 5% above that of the like period of last
year.
In
the preceding week, Aug.
27,1955, an increase of, 4% was recorded.
For the four weeks ending Sept.
3,1955, an increase of 1% occurred.1
For tne period Jan. 1, 1955, to Sept.
3, 1955, the index recorded a

Midlly

a

Higher Trend the Past Week
A further mild
uptrend in the general
last week lifted the Dun & Bradstreet

price index
Aug. 30

and

Grain

Sept. 6 to 277.74.

with

276.54

markets

fluctuated
erately

for

commodity price level
oaily wholesale commodity
This compared with 275.68 on

the

on

corresponding date

unsettled

were

irregularly with wheat,

higher, while

oats

and

rye

and

corn

trended

barley ending mod¬
lower.

Wneat

displayed

firmer tone

a

the peak of the Spring

as

wheat movement enaed and
offerings of both Winter and Spring
wheat remained moderate.
Rye and oats declined under limited
demand.
Trading in grain and soybean futures on the Chicago
Board cf Trade fell to

a daily
average of about 52,000,000 bushels
57,300,000 the week before.

from

Pre-holiday dullness ruled in the domestic flour market with
buying confined largely to fill-ins. Export flour trade continued
quiet except for small quantities sold in Latin America. Rice
prices were firmer at the week-end as demand from both domestic
and

foreign

prices

the

further

a

week-end

ation.

showed

sources

scored

the

as

Warehouse

rise

result

stocks

compared with 255,300

as

Green

tionally
early

heavy

in

vacuum

coffee

the

demand

week

was

of

of

of

cocoa

were

some

of

by

reported

upward

roasters
advance

at

Cocoa

at

the

renewed

3

cents

wholesale

a

at

devalu¬

254,820

bags

section seven, as is true

cotton

prices

in

their

in

a

narrow

pride. It
legislation

range

and

lation

when

necessary,

quate in size

sidering
problem

of

present
the

sion's

budget

Federal

1

and

in

presented

the

Commission's

gers

fer

that

part

not

the

to

brevity,
tential

as

first, for
"mergers

among

competitors"

second

and

hibits

mergers

stantially
which

I

which

lessen
degree

of

increasing as picking
and ginning continued to make
good progress in most of the active
harvesting

areas.

the 1954-55

Consumption of cotton in

season

Trade

was

was

reported the largest

Volume

in

Latest Week

the free world during
on

record.

Stimulated

by

the

of

ticular

meant

respect

volume

the

of

sales

comparable

rose

to

higher

than

Bradstreet, Inc.
1954

a

ago,

Regional

levels by the

Southwest

year

a

level

trade in the week

according

estimates

to

varied

estimates

was a

from

the

Boys' slacks, sports jackets and shirts were
popular items. Children's shoes sales increased
College departments reported heavy buying of men's
of

women's

aoparel

comparable
to

-f-10;

among

the

noticeably.
slacks, suits

rose

Furniture

retailers reported a substantial rise in sales last
Upholstered living room chairs and occasional tables were
the best selling items. Blankets, sheets and
pillow cases expanded

week.

Sales

of

was an

hardware

and

increased call for draperies.

paints mounted considerably.
The
continued interest in high priced china and
glassware was main¬
tained.




already

companies

have

ganization, the financial
and

often

needed

into

volume of sportswear sales.

volume, and there

easiest

lished

somewhat,
but fell slightly below last year's level.
Women shoppers sought
Fall suits, knit dresses and shoes. There
was a slight decline in the

in

is

the

say,

a

the

for
new

the

or^

resources,

managerial

successful
market.

skill

entrance

Let

us

con¬

The first

is that of an industry
not, in the economic
national industry but one

is

sense, a

made up of a series of local mar¬
kets

where

one

company

uses

the

A

kind

second

trant

who

of potential en¬
lose that role by
that
of
a
company

may

is

merger

which makes and sells products of

type

one

category,
company

another

in

a
broad commodity
who
merges
with
a
which produces and sells
type of product in the

general
category.
Since
neither has been selling the sub¬
type of product of the other, it is
same

not at all clear that such

would

come

of the

present section
the

in

under the

6f

case

a

merger

jurisdiction
But

seven.

companies

in

facture

the

sale

and

of product Type

manu¬

V in the

general

same

vice

of the most likely

one

into

entrants

versa

commodity.
And
Company N is a likely

into

entrant

the

sale

of

product

Type I of that commodity group.
the

When

there

is

two

companies marge,
longer a chance that

no

the

market

of

a

the

new

other.

seller in
What

I

have referred to here is the char¬
acteristic of many of the so-called

product line spreading mergers.
It is necessary

here.

to add two points

First of all is I

not

demning,

kets. Since each market is a sep¬
arate market, such mergers cannot
be looked
upon
as
substantially

which sell different types of prod¬

lessening existing competition

ucts in

cept

in
is

two
that

becomes

so

situations.

extreme
in

which

large

have monopoly

ex¬

a

that

company

it

power as a

gers

am

geographical
the

same

Certainly in

markets

commodity

some

or

area.

of these cases
business is

in which the acquired

would

small,

buyer

means

the

merger

whereby

an

is

merely

aggressive

they

outside

are

the books in the form

interpret it,
of

lead

may

the

merger

tendency in the direction of con¬
glomerate mergers.
(Obviously,
I

not

am

here to

referring

glomerates

that

extension

of

built

are

the

activities

company

without

than

small-scale

by

which

in

While

vide

the

are

started

a

other

acquisitions
of

getting

field.)

economics

criteria

by

of

mergers

means

new

a

con¬

up

does

whereby

not

pro¬

one

may

judge the economic effects of the
conglomerate
enterprises,
this
does not mean that organizations
of that type are unimportant.
We
do not know how a conglomerate
firm will

conduct

itself in

ticular market when, as I

a

par¬

suming here, its share of that
ket

is

such

not

powerful

to

as

influence

alone.

son

mar¬

it

make

for

as¬

am

that

a

rea¬

Such

companies' ef¬
competition may stem

on

their financial

strength and
ability to withstand vigorous com¬
petition in one of the several mar¬
kets in which they sell.
Much of the policy aspect of the
conglomerate firm stems from the

attitude

of

the

public and of its

representatives
toward

such.

large

in

government

economic

units

as

Consequently, the conglom¬

erate

mergers

are

much

as

a

socio-political problem as an eco¬
one.
My only reason for re¬
ferring to it here is to suggest

nomic

that

the

enforcement

of

Section

Seven may augment

the tendency
toward mergers of the conglom¬
erate
sort.
If
this
happens, it;
be

worthy of study but it
problem on which I have
specific opinions as to public

is not

a

policy

this time.

at

Turning

now

legislation

to

which deals with competition and

price
to

be

sections

which

want
what

the

purposes

law.

the

of

has

I

outset

the

at

cate
me

practices,

not

often

to

indi¬

seems

to

of

these
The first,

been

stated

inferred
legislation and its his¬
tory, is that much of what was
enacted was desiged to bar struc¬
tural changes in the economy. The
purpose
was not
merely to re¬
overtly

from

strain

but

has

to

be

the

those

that

have

a

clear

con¬

out off hand, all mer¬
between companies in sep¬

arate

companies

which

sublimation

a

fects

market.

for

on

which I

to

from

merger method to become a
seller in a number of local mar¬

One

lessen,

ing is, that the fact that Section
Seven is
in

Market V

either will become

sider two types of examples.

which

mergers

the coverage of the present
legis¬
lation. In a sense what I am
say¬

merely replaces Company N

that

as

afield

acquire

Type I, it is

the

&

marked increase in the demand for
back-to-school

The sales volume

of

one

look

any

be

enforced

to

substantially

may

would

firm

is

respect

selling

which have the funds and the de¬
sire to grow by merger, may then

separate geographical markets, I
would suggest that if Company A
were
well established in product

to

into

Seven

with

would

the most likely
production and
sale of one type of a broad cate¬
gory
of goods, for there entry
entrant

to

following percentages: New England, East and

most

sr oes.

observation holds

same

3

wear.

and

potential

or

ordinarily by a
doing business in
another type of product in thi3
commodity
area.
These
estab¬

higher

was

by

+3 to -f-7; South ~f-5 to +9; Midwest -f6
Northwest 0 to +4 and the Pacific Coast
4-1 to +5%.
There

em¬

Dun

noticeably

1954 week.

The total dollar volume of retail

7%

Section

would

buying.
of

would

Furthermore, I
would assert that, in a large part
of American
industry, the most
likely entrants into any particular
geographical market are firms al¬
ready established in other mar¬
with

total

I

1

the

market.

Downtown and suburban business centers
reported a moderate
increase in retail trade in the
period ended on Wednesday of last
week. Cooler weatx.er and
many sales promotions stimulated con¬

that

away,

Com¬

which

that since Company A
has
merged with
Company N,
Company A is no longer a poten¬

in

by

sellers into the par¬

new

The

The

V

likely entrants into Market
disappeared.
Or rather I

would

sub¬

competition.

actual

kets.

than

sizable

Market

has

but

that the most important
influence on future competition is

Many Sales Promotions

sumer

V

pro¬

would

is

of

economist,

an

entry of

cotton

in

N

distance

most

the

seven

not

assume

referring to the
Company A in

am

acquires

some

mer¬

competition,

understand

existing
As

new-crop

have

tial additional seller in

The amended section

com¬

geographical

or

when

I

pany

gers."

that

that

Market

po¬

to

"conglomerate

as

Rather I

fact

re¬

purposes

among

separate
have

tion.

Trade

shall

I

mergers

in

with

that if they do, they can be han¬
dled
under the
present legisla¬

Acquisitions,
two types of mer¬

covered.

concerned

achieved that status for I

Corpo¬

on

not

am

markets

and

that

are

Federal

I

panies

Commis¬

phasize

movement of

Here

interpretation

Report

Mergers

seems

its

con¬

that

whether

read

seven

the

multi-market

and therefore may
have, in
effect, wiped out the local mar¬
ket
price-making
characteristic
of the industry.

is wholly inadequate.
the
amended
sec¬

work

As

Trade

of

kets

en¬

me

under

are

series

a

they meet each other
repetitively in the various mar¬

that

this

to

for

of

firms

time-consuming
important mar¬

studying
cases, it seems

ginal
the

the

of

task

Cautious trading also reflected
uncertainty over the next gov¬
ernment crop estimate to be issued on Sept. 8 and
possible gov¬
ernment action on the cotton export situation.
•

trol

training. Con¬
importance of the

and

large portion of the

a

local markets

and

the

The other would be

where such

forced because the staff is inade¬

miu-January.

The

As

strictly

of materials.

legislation

on

is

no

slightly lower for the week. Depressing influences included
hedgeseuing ana liquidation influenced by tne continuing
slump in
export business.
With only a few scattered exceptions,
weekly
cotton exports have been smaller than a
year
previous since

this

which has been enacted is not

it

finished

of

the books, or to in¬
vestigate whether additional legis¬

rate

level.

talk of devaluation in Brazil but

moved

merger involves firms
unlike commodities.

competition in particular markets,
it
is
possible
that
companies

passed with justifiable
does little good to put

excep¬

announcement

pound

it

generally, is

ate

16

mpage

the

to deal with monopoly
particular industry or mar¬
By definition, a conglomer¬

a

ket.

Working of Anti-Trust Laws

enforcement
which

tion

by

change in tne present rate of exchange is anticipated. Lard prices
trenc.ed mildly lower in light
trading. Livestock markets at Chi¬
cago were generally steady to firmer.
A siignt advance in hog
values reflected light market
receipts and a more active and
stronger wholesale pork trade.
Spot

The

fro

are

that

actually deals with
in extreme cases.

except

new

that

a year ago.

influenced

following the
of

easy

Brazilian

week previous, and 104,398

a

an

improvement.

talk

renewed

prices continued

packed coffees

There

considerable

although the market turned

in

from that of the corresponding
period of 1954.

Continued

type

see

designed

Prices

Coin developed
strength in the latter part of the week, re¬
flecting meager producer marketings. Early weakness in the
yellow
cereal was influenced
by relief from drought and heat conditions
whichrhad reduced the prospective yield
substantially. A private
estimate issued during tue week indicated a
crop of 3,143,000,000
bushels, a drop of 353,000,000 bushels from tne official August

forecast.

rise of 2%

ago.

year

a

during the past week.

While the

report of the committee sponsor¬
ing the new section seven did as¬

of the anti-trust laws

Wholesale Commodity Price Index Showed

Such

assurance

My second comment on mergers
has to do with those which are of

re¬

for

market.

greatest

our

rivalry

sert

City

entrants

tive organization of the market.

week

10%

about

is

that

effective

other's

maintain

pointed out, however, that
showing in the comparable period last year was
largely

the poor

due

volume

estimated

an

each

entry

taken from

as

wipe

nevertneless,

may,

potential

into

ended Sept. 3,
1955, advanced 11% from the like period last year. In the preced¬
ing week, Aug. 27, 1955, a rise of 9% was registered from that of
the similar period of 1954, while for the four week's ended
Sept. 3,
1955, an increase of 7% was recorded. For the period Jan. 1, 1955
to Sept. 3, 1955, a gain of 7% was registered above
that of 1954.

wheat, corn, rye, barley, butter, milk, cocoa, potatoes, rice,
steers,
hogs and lambs. Lower in price were oats,
lara, sugar, cottonseed
The index represents the

a

retailers

flour,

were

was

the Federal

drop

which

mergers

lessen substan¬

to

appear

com¬

out

slight increase in wholesale orders last week. The
dollar volume of trade remained
substantially higner than last
year's level. Although in some lines inventories were
light, most

wholesale food

not

tially the present degree of

foods

diminished.

Wholesale Food Price Index Advanced in Latest Week
From Previous Week's Low Level

company

petition

.

.

Interest

are

a

My point is that

South

States, had

whereby

comes

high demand for dairy products and

foods.

31

(1095)

,

the
new

to damage competition but
also inhibit those buying and sell¬
ing methods which were basically
adaptations to technological de¬
velopments
but
which
would
change the relative role of small
independent
businesses
and
of
power

large

companies.

In

Continued

some
on

cases

page

32

32

The Commercial and Financial Chronicle

(1096)

the latter is barred, then the

Bank Advisors at "Atoms for Peace" Conference

of any
and

price change is
could expect a

we

prices
have

far

than

greater
experienced.

cost

high
rigidity of
very

that

we

commodity areas where they have
no
alternative, as in copyrighted
books, or where they feel in¬
competent to judge quality, as in
drugstore items.

by the facts in the Detroit
Case.

Jobber

What was going on
gasoline business was a
structural change whereby twoin

the

tributions

station

necessary

station
i^ not
considerable part
gasoline. The particular
involved here and their

for

necessary

that

jobbers

retailers,
tions

by tank

retail

to

wagon

of

station

bulk

a

whether the

retail

sta¬

operated by the jobber
not, elected to use some of the

or

were

economies of

step distribution

one

to lower the retail price. Such a
development, which parallels on a
small scale the early development
of
chain
stores,
is the
process
whereby competition brings about
a
structural' change
and
gives

benefits

the

consumers

nological advances.
My second
Bill

11

tech-;

of

;

:V,

is that its effect would be

a large firm from
making
change in its price for a prod¬
until it was willing to accept

uct

the

loss

realize

I

in

Atomic

From

left

to

to

S.

right:

Paul Genachte, Chase Manhattan Bank; Wayne Remberd, World Bank;
First National( City Bank of New York; Corbin Allerdice, World Bank; Ashton
J. O'Donnell, Bank of America; Karl M. Mayer, Economic Staff, U. S. Atomic Energy Commission.
Michael Michaelis,

from

31

page

tion

the

The

Working of Anti-Trust Laws

this

structural

lor

a

large

change wiped out,

of

part

business,

a

transaction step such as that from
manufacturer

wholesaler.

to

In

view,

the desire to restrain
structural changes which
would
bring monopoly is meritorious but
the desire to maintain a particu¬

my

lar

in which business was
done in spite of basic technologi¬
cal changes or of clear effects on
competition has been unwise.
way

it,

that

who

manufacturer

a

is

be

would

quoted

shipment

on

the

of

carload

a

manufacturer's

advertised brand. The

own

manu¬

tive and, given the organization of

retail

be

of

the

industries, this

our

least

may

solution.

bad

The first control of

competitive

conduct which I will discuss is the

quantity-limit proviso of the Robinson-Patman
marks

the

to

par¬

Commission in

of the rubber tire indus¬

case

try, not to the proviso itself.
have

this

I do
to

as

itself
if this
only attempt to apply it
followed by other moves

and

is to be

proviso

is

certainly

and

necessary

of

reservations

some

whether

one

re¬

my

application of it made by

the Federal Trade
the

but

addressed

are

ticular

Act

similar

a

sort, then the Con¬
I think, should give serious

gress,

attention to the repeal of the pro¬

viso itself.

tire

quantity limit

a

industry,

the situation

since

the

to

demand

reflected
the

sale

particularly

that

its

for

structural

a

and

control

a

products

are

tributed

even

over

purposes

to

competition

but

which

damaging

rather

in

tires

an

of

aug¬

menting of it. This brings me to
the
particular provision of the
.quantity limit order on which my
objection centers.
to

Commission's

the

fact

the

which states

order,

additional

that

discounts shall

be given for shipments

larger than
together as one

produced

injured but has been
augmented. Put another way, the
Commission's

indicates

order

understanding of the focal
point of competition in this in¬
dustry, or a disregarding of that
knowledge. The key source of
competition, particularly insofar
as
replacement market for pas¬
senger car tires is concerned, is
the

conflict

of

interest

between

their

distribute

well-known brands

large

distributive

and

who buy tires with their "private
brands" on the product, and then
a

lower price made possible

one-step

a

minimal
alternative
acts

distribution

sales

before

the

consumer

powerful restraint on
manufacturers
and
their

as

what

dealers

a

get

can

for

well-known

factory brands.
In

pushes
his

up

manufacturer

from his costs including

high distribution

attempts
and

the

sense

a

to

get

volume

as

as

expenses and

good

a

possible.

of

in the almost

as




a given
I interpret

tive process

the

large

price

On

organizations, who

It means,

and

Such

expense.

tional

manufactured'by

the

organizations

hand,

tires

a

lack of

other

company.

dis¬

and

though competition

carload, puts
commodity or product, all brands
a

com¬

has not been

by

of

not

no

is

petition and pricing which is de¬
signed
to
inhibit
a
structural
change
in
the
way
in
which

change

replacement

that

limitation

sell at

distribution

amount

rise

gave

did

refer

private brand selling in large
organizations. The quantity
limit rule, by making both types
of
brands
subject to the same

imposition

for

I

in

the manufacturers who

I doubt whether

the

facturer has engaged in

1

rule in any form was called for in

which

large

the

distribu¬
engage

inherently competi¬

of retail distribution

tend

retail price

volumes

distributional

and

by buying tires from
same

the

known

manu¬

cheaply as they can.
time, the consumer

as

At the

low

expenses

choice

of

factory

buying

brands,

well-

such

as

those of

tjhe large companies' tires

used

original equipment, or of
so-called private brands

as

buying

lower price. The availability
such
lower-price alternatives

at

a

of

is
in
I

the

key aspect of competition
such a consumer-goods market.
hope that this order does not

reflect

the

mission's

Federal

views

on

Trade

Com¬

of

sources

ef¬

fective

competition in consumer
goods industries. I would be more

hopeful

that

on

to

in

had

score

Commission not made

the

is

proviso

a

to

appears

re¬

meeting

the

attempt
negate the meeting competition
good faith defense under the
an

the meaning of "substan¬

on

tially,"

it

seems, likely
effect would be that of
ment sanction

that
a

the

govern¬

of

price uniformity
by the firm and through that of

the

industry.

be

can

ing

has

places the dis¬

and

company,

name on
the tires, but
prices the product on a non-dis¬
criminatory basis, cannot give a
lower price to such buyers than

brands,
a

sold and get their profit by keep¬

facturers

expensive
selling and advertising activities
program for his own brand and
has developed a dealer organiza¬
tion, both of which costs are by¬
passed to a considerable degree

many

at

oil

tributor's

in active competi¬
themselves and with

back from

there

that

mind and the trend of court deci¬

are

manufacturers'
press

producing tires for a large chain
store
organization, or group of
farm supply cooperatives
or an

Second, either because of effect
competition or on competitors,
the purpose of this legislation has
been to inhibit the ability of the
large firm to utilize fully its
strength as a competitor. I find
myself less critical of this objec¬
on

to

they

among

11

mission's Detroit Jobber action in
sion

Continued

would

changing all of them.

competition
proviso
only
where
doing
so
would substantially lessen compe¬
tition. However, with the Com¬

World's

where

which

revenue

that

B.

move

Largest Banks meet at Geneva "Atoms for Peace" Con¬
ference for informal discussion of financial problems related to world's atomic development.
Advisors

Energy

of

from

come

Now I

understand

can

would have this view

why

one

of the way

But the

analogy has

Industrial

kets do not work that
way.

changes

of

and

will

and

we

the

be

general

at

best

mar¬

of

particular

will

changing

their

realization
the

have

of

their

shown

It

to

their costs

down, remove unneces¬
services, and survive. -1 see

sary

to

tant

in

loss

me

the

cost

these

consumers

seems

be asked to

in

trades, who are unable or
unwilling to meet competition.

Actually,
nance

in

is

resale

price

mainte¬

delusion for the
entry is easy—and .it

be

may

retailer.

If

a

businesses—the

such

most

store-wide gross

margin will come
to reflect competitive cost levels.
If resale price maintenance holds
margins
on
some -items
above
what they would be otherwise,
competition will force offsetting
reductions
in
margins in other

items,
erage

so that the store-wide av¬
would be unaffected.

In

conclusion, I wish to stress
more
the social gain from
which brings about ap¬
propriate adjustments in the way
business is done, and which forces
costs and prices down
to levels
warranted
by efficient competi¬
tors
using
up-to-date
methods.
Such competitors will always put
out of business competitors who
once

conduct

do not meet those tests.

should not be with

Our

con¬

that, but

practices which threaten to
organization of a market

alter the
that

so

it

fectively

will

no

longer

be

ef¬

competitive.

William E. Coale
William

E.

phia passed
age of

63.

Coale

away

of

Sept.

Philadel¬

7 at the

Mr. Coale for 32 years

associated with the Philadel¬

was

as

that

Co.

com¬

group.

a

no

Impor¬
effective com¬

contracts)

decisions and the so-called Detroit

se.

Jobber

am

(as

should

and

in

sales

consumers

subsidize retailers

other

phia office of Eastman, Dillon &

petition would be incurred if tiesive

why

reason

no

of

level

to

of

cost

have

of

effect

average

compared

average

modities

operations,

own

remarkable ability to get

a

decisions

the

I
realize
that
two
strongly
opposing views are held on that
point. Following the basing point

cases.

cooperative- or
voluntary
plan
wholesalers, plus a modernization

are

Robinson-Patman Act.

Case, opposing sides have
introduced legislation designed, in
their
respective
judgment,
to
either clarify or change the Su¬
preme
Court's rulings in these

markets and smaller stores,,
by getting supplies from low-cost

infrequent,

pin much of our
hope for competitive price adjust¬
ments on gradual change of their
prices
by
manufacturers
by
a
which

trades.

Price

sort

must

series

not

super

with

the

grain
exchanges or even on the oneprice practices of most retail es¬

validity.

dis¬

are

that share

ownership is shown by the
There, independent

store

food

cern

limited

preserve

of retail business which offers the

competition ought to work if his

tablishment.

to

service and benefits of individual

attention is centered

on

such

That

tribution.

brands

one-step

.

objection to Senate

to deter
any

national

of

low-cost

against

and

de¬

are

signed to bar structural change- in
the economy. They are set up as
a
tariff of costly two-step dis¬

transactions
and
physical
handling from tank car to bulk

step

laws

such

Basically,

The first of these points is illus¬
trated

Thursday, September 15,1955

...

distinct from

exclu¬

r

V
3>

(Don't sit back<

dealerships and requirement
were

made

as

general

While

a

suspicious of
times

are

tion

of

per

matter

I

per se

rules, there

the

administra¬

when

provision

a

illegal

is

greatly
rule, and
the damage by its use so
small,
that the best device is to prohibit
aided

by

that

My
view
is
that
the
Supreme Court was right both in
interpreting
the
law
and
in

competition

so

of

a

understanding the importance of
meeting competition as a means
of maintaining competition. I do

kind

not

believe that either

hart Bill
bears the
of

this

the

Cape11, which

Senate Bill

or

of

name

members

some

Committee,

are

necessary

desirable.

or

Involved
are

here, it seems to
important aspects of how

me
one

thinks competition does, or has
to,
work in
an
industrial economy.
To

me

important

an

competition

is

the

aspect

of

adjustment of

the

particular practice without re¬
gard to whether its effect in some

particular

is

cases

injurious

to

not.

or

I would not,

however, apply the
reasoning to exclusive deal¬
erships. My views on this point
are analogous to those of the At¬
torney General's National Com¬
same

mittee
to
Study the Anti-Trust
Laws, and I need not repeat them
here.
I might say, however, that
this conclusion is strengthened by
the trend of decisions which have
narrowed

the

constitutes

a

of

of

concept

what

substantial lessening

organization of business, in¬
cluding the structure of distribu¬
tion,
to
meet
new
conditions.
Freezing the way markets are or¬
ganized is an inevitable part of a

not effective for

control

consumer

control

program

is

ernment.
are

not

by

a

whether

cartel

Second,

or

price

a

that
gov¬

changes

going to be of the wheat-

pit sort, but often will reflect ad¬
justments
structure

of
to

parts

meet

of

a

price

competition. If

competition.

Finally, I wish to enter a strong
objection to resale-price mainte¬
nance laws.
Fortunately they are

be

STRIKE BACK!

a large portion of
goods because they can
avoided by varying
trade-in

allowances
ers

can

goods

of

tions.

But

sent

a

and

do

or

bu.y

because

the

distributive
these

break

in

exploit

consum¬

private
laws

do

anti-trust

the

labeled

Give to

organiza¬
repre¬

policy
consumer in

AMERICAN CANCER SOCIETY

'

Volume 182

Number 5464

The Commercial and Financial Chronicle

...

The following statistical tabulations

Indications of Current

latest week

Business Activity

week

INSTITUTE:

STEEL

AND

IRON

Indicated

.Sept. 18

month available.

month ended
Month

Ago

that date,

on

§2,295,000

-Sept. 18

2,264,000

2,176,000

1,583,000

6,111,400

July:

6,946,000

117,642,000

7,582,000

2
2

26,183,000

26.611,000

1,979,000

2,044,000

2,094,000

2,605,000

Sept.

2

11,567,000

11.307,000

11,063,000

10,011,000

Sept.

2

7,482,000

8,027,000

7,146,000

7,567,000

(bbls.)

Residual fuel oil output (bbls.)

7,487,000
25,953,000.

Btocks at refineries, bulk terminals, in transit, in pipe lines—

Distillate

fuel

oil

(bbls.)

at

Sept.
Sept.
Sept.

Residual

fuel

oil

(bbls.)

at

Sept.

gasoline

unfinished

and

Finished

(bbls.)

Kerosene

(bbls.)

at

at

2

153,292,000

154,698.000

156,476,000

34,945,000

34,093,000

32,475,000

133,365,000

119,479,000

46,587,000

45,273,000

56,194,000

129,794,000'

46,459,000

gas sales

(number of cars)

794,192

3

791,977

U.

—

«■<•*

construction

gal¬

586,929

8

$375,714,000

$330,296,000

$334,458,000

$220,717,000

8

289,809,000

166,329,000

188,211,000

108,0^8,000

8
8

85,905,000

163,967,000

146,247,000

112,679,000

78,897,000

144,631,000

128,596,000

84,113,000

19,336,000

17,651,000

28,566,000

coal

lignite

and

Pennsylvania anthracite

SYSTEM—1947-49

Slab

Electric

(in

output

OF MINES):
(tons)

:J

Pig iron

AND

INDUSTRIAL)

—

251,722,000

Lead

(New York)

Zinc

U.

S.

at

f

3

125

111

97

113

10,155,000

10,706,000

10,729,000

8,808,000

SERVE SYSTEM—REVISED

205

A

U. S.

215

Group

Group

Group

YIELD DAILY

AVERAGES:

Government Bonds
corporate.

—

Average

—

Aaa
Aa

5.174c

$59.09

$43.83

5.174c

5.174c

$59.09

$59.09

$43.83

4.801c

■

.—^

—

Group

RaHroad

Sept.
—Sept.
Sept.
Sept.

$44.00

$28.61

—

Orders received

sales by

dealers

7
7
7

j

sales

value

Short sales

sales

Total

"124

111

104

*98

98

Month

Adjusted

11.155c

Without

94.95

94.77

95.00

99.94

107.27

107.27

107.98

110.70

110.70

110.52

111.07

115.24

109.06

108.88

109.60

112.37

107.27

107.27

108.16

110.70

102.63

102.63

103.13

106.04

106.56

109.24

107.80

107.80

108.52

108.16

108.70

2.87

2.89

2.87

2.50

3.32

3.32

3.28

3.13

3.13

3.14

3.11

2.89

3.22

3.23

3.19

3.04

\

3.29

3.29

3.25

3.12

3.26

3.27

3.24

400.8

3
3

3
3

382,847

249,364

367,978

Aug. 20
Aug. 20

Aug.
Aug.
Aug.
.—Aug.

20
20
20
20

sales
—

transactions initiated off the

SOCIATION
of

291,453

283.215

278,376

244,002

101

99

98

91

OF

CLASS

I

AMERICAN

51,875,232

51,731,855

50,502,510

$849,559,590

ROADS

$875,112,392

$779,846,202

644,827,920

644,882,624

75.90

73.69

79.32

$90,034,664

$19,320,500

$67,664,974

92,612,113

106,033,546

71,155,175

72,000,000

88,000,000

50,000,000

29.700c

RRs.)—Month

operating revenues
operating expenses~,-,T—

Operating ratio

—---—

—

—

Taxes
Net

(AS¬

...—.—a——

railway operating income before charges
charges (estimated)

Net income after

METAL PRICES

<E.

M.

&

J.

618,597,281

QUOTATIONS)—

Average for month of August:
Copper (per pound)—
Electrolytic domestic refinery

38.150c

Electrolytic export refinery—

—-

665,766

589,665

691,068

Common, New York (per pound)——,—
Common, St. Louis (per pound)—-

35.700c

40.009c

36.504c

15.000c

15.000c

29.492c

398,372

106.84

106.61

106.39

14.800c

14.800c

£106.494

£105.940

£96.908

months, London (per long ton)—_
1iAntimony, New York BoxedAntimony (per pound) bulk, Laredo:—_—
Antimony (per pound) Laredo

£105.920

£105.601

£.94.896

34.137c

31.970c

31.970o

30.667c

28.500c

28.500c

31.167c

29.000c

29.000c

$84,000

it Prompt, London

(per

ftThree

166.39

Platinum refined

854,453

975,290

1.181,336

1,049,762

$47,603,905

$51,612,834

$62,963,160

$84,000

$82,540

12.500c

12.500c

ll.OOOo

ftZinc, London, prompt (per long ton)——_
ttZinc, London, three months (per long ton)
tCadmium, refined (per pound)

£89.710

£91.226

£75.318

U89.716

£91.214

£75.592

$1.70000

$1.70000

$1.70000

$1.70000

$1.70000

$1.70000

$1.70000

$1.70000

$1.70000

$2.60000

$2.60000

$2.60000

90.750c

90.488c

(per ounce)

1,026,744

1,144,156

5.338

5,881

6.740

14,674

670,269

779,494

1.020,004

1,129,482

$34,452,337

$41,063,005

$52,325,371

JCadmium

$51,009,687

177,600

203,660

276,650

203,660

276,650

pound)
—

Silver,
Silver, London (pence per ounce)
Sterling Exchange (Check)-.
Tin,

New

York,

99%

(per

ounce,

Gold

286,162

Aluminum, 99%

96.805c

93.356c

95.805c

92.356c

pound)

$35,000

$290,000

24.333c

23.200c

22.106c

28.500c

27.000c

64.500c

60.000c

$2.25

:

$35,000
$264,920

64.500c

(per pound)—

$35,000
$253,889

30.574c

—

—

(per

72.940

$2.81324

95.458c

U. S. price)
flask of 76 pounds)
plus ingot (per pound)—

Magnesium ingot

78.869

$2.78494

96.458c

min

(per

85.250c

79.119

$2.78665

Straits—,—

York

Quicksilver
455,040

•

Sterling Exchange—
New York (per ounce)

§§New

403,730

—

Silver and

383,870

367,840

—

pound)

(per

Cobalt, 97

383,870

177,600

(per

§Cadmium

785,375

13.8580

T

(per pound)—East St. Louis———

$47,922,721

675,607

14.0580

(

long ton)———_

—

436,530

393,310

491,690

619,410

7.152,220

8,742.810

11,463,630

12,408,410

7,588,750

9,136,120

11,955,320

13,027,820

—Aug. 20

floor—

875.060

1,206.010

1,442,030

1,546,480

180.900

271,570

252,260

682,650

979,190

1,323,940

1,165.410

£71,030

1,160,090

1,595,510

1,417,670

188,380

$2.25

Month

420,730

327.900

238,530

183,010

16,900

252,480

293,470

177,630

269,380

321,070

40,800

27,600

158,630 '

19,000

4

$2.25

U.

GOVT.

S.

at

496,165

Total

75,580

90.230

211,720

398.810

582,525

624,880

542,585

474,390

672,755

$281,000,000

$281,000,000

278,309,014

277,584,032

274,955,006

43,455

41,514

27,291

$273,352,470

$277,625,547

$274,982,297

480,967

482,814

535,267

$277,871,502

$277,142,732

$274,447,030

3,128,497

3,857,267

6,552,969

$278,352,470

$277,625,547

$274.062 297

5,753,343

6,810,921

5,457,423

$272,599,127

that

$270,814,626

$269,504,874

be outstanding

may

public debt

Guaranteed

obligations

Treasury

not

owned

by

the

——

public
obligations

debt

gross

and

guaran¬

836,600

361,472

teed

Deduct:—other

1,403,415

2,370,545

1,806,012

2,314,480

322,480

273,380

389:400

504,780

1.268,765

1,630,480

2,199,935

1,903,860

2,589,335

2,663,770

debt

obli¬

Ealance

total

face

outstanding

amount

of

obligations,

Issuable

2,158.990

1,591,245

public

outstanding

gations not subject to debt limitation—,
Grand

under above

authority

DEBT DIRECT AND
GUARANTEED—(000's omitted):
STATES

UNITF.D

GROSS

As of Aug. 31——

110.6

110.5

110.2

87.9

87.8

93.1

101.4
84.2

82.7

117.2

117.1

fund

balances.

109.9

88.1

Sept.

foods.

97

(000s omitted):

amount

gross

451,720

115,100
427,485

345,345

Sept.

foods-

19,674,000

108

$281,000,000

31

22,802,000
28.632,000

23,610,000

LIMITATION

DEBT

time

Total

Sept.

other than farm and

face
any

27,066,000
29.172,000

18,828,000

(barrels).,

month—barrels)-

STATUTORY

—As of Aug.

Total

26,783,000
31,260,000

—

mills
of

409,500

Sept.

products

MINES)—

111

end

General

Meats

OF

(barrels)
from

(at

(BUREAU

Jiine:

of

Production

Shipments

368,700

100):

commodities

CEMENT

Outstanding—

Commodity Group—

Sept.

,

^Includes 799,000 barrels of foreign crude runs. SBased on new
of Jan, 1. 1955, as against Jan. 1, 1.954 basis of 124,330,410 tons.
fNumber of orders not reported since introduction of Monthly Investment Plan.




33,163,867
$587,689,000

July:

Total

_—

*s

38,126,562
$639,059,000

Capacity used

Aug. 20
Aug. 20
Other sales
——Aug. 20
Total sales
—Aug. 20
Total round-lot transactions for account of members—
Total purchases
Aug. 20
Short sales
Aug. 20
Other sales
Aug. 20
Total sales
Aug. 20
•niOLESALE PRICES, NEW SERIES — U. S. DEPT. OF

figure.

38,850,790

$647,704,000

of

—

EARNINGS

Stocks

purchases

All commodities

consumers'—

Number of ultimate customers at June 30——
RAILROAD

Bismuth

Short sales

'Revised

ultimate

"Nickel

Aug. 20
Aug. 20
Aug. 20

Short sales

Processed

to

-

Zinc

Aug. 20

sales

Farm

■—

——

311,987

Sept. 9

Aug. 20
Aug. 20
Aug. 20

transactions initiated on the floor—
Total purchases

All

sales

June

410.2

Aug. 20

=

adjustment

Month of June (000's omitted).;
from ultimate customers—month

3.06

408.2

Aug. 20
Aug. 20

(1947-49

seasonal

PORTLAND

sales

—

1947-49 Average^! 00—

—

Revenue

112.00

411.7

Other

LABOR

RE¬

ELECTRIC INSTITUTE:

Total

,

(FEDERAL

for seasonal variations

Kilowatt-hour

110.88

108.34

SALES

104.66

105.86

STORE

(SHARES):

purchases

Total

118

of August:

14.500c
14.300c

3.13

Aug. 20

8hort sales

Other

1,800

12.500c

3.21

TRANSACTIONS FOR ACCOUNT OF MEM¬
BERS, EXCEPT ODD-LOT DEALERS AND SPECIALISTS:
Transactions of specialists in stocks in which registered—

Other

2,773

15.000c

3.47

by dealers—

OF MEMBERS

2,303

14.800c

3.27

sales

Total sales

6,876

1,831

12.500c

ROUND-LOT

Total

7,557

1,834

15.000c

3.36

Short sales

Other

7,420

—

5.328

credit

14.800c

3.56

Total, sales

Total

4.586

Service

15.000c

round-lot sales—

Other

5,152

3,040

13.000c

STOCK

ACCOUNT

1,037

5.192

2,686

SYSTEM

TOTAL ROUND-LOT STOCK SALES ON THE N. Y.
EXCHANGE AND ROUND-LOT STOCK TRANSACTIONS
FOR

1,562

2,991

SERVE

3.39

—Aug. 20
Aug. 20
Aug. 20

Number of shares—Total sales

Round-lot purchases
Number of shares

1,570

—

2,595

93.250c

3.32

sales by dealers—

Other

5,639

accounts

97.125c

COMMISSION:

other sales

Dollar

10,298

5,676

loans

payment

95.625c

ACCOUNT OF ODDON N. Y. STOCK

Odd-lot purchases by dealers (customers' sales)—
Number of orders—Customers' total sales

Round-lot

loans

credit

DEPARTMENT

3.59

PRICE INDEX—

(customers' purchases)—t

short

21,849

12,561

—

29.625c

3.40

of period—

value

Customers'

Non-instalment

14.800c

13
13
13
13

Sept.
Sept.
Sept.
Sept.

Number of shares

Customers'

$28,725

24,914

—

loans

38.275c

3.32

(tons)

EXCHANGE—SECURITIES EXCHANGE

Dollar

$32,471

25,476

-

—

Lead-

STOCK TRANSACTIONS FOR ODD-LOT
LOT
DEALERS AND
SPECIALISTS

Odd-lot

Personal

95.500c

7

ASSOCIATION:

Percentage of activity
Unfilled orders (tons) at end

$32,896

credit

■——

modernization

43.050c

INDEX

OIL, PAINT AND DRUG REPORTER
1949 AVERAGE = 100

and

44.300c

3.59

(tons)

Production

41,059

goods

29.700c

oept. 13

PAPERBOARD

64,056

-———

35.700c

Sept. 13
RATIONAL

73,632

13,038

term

credit

42.525c

Sept. 13

Group
Group

COMMODITY

193.253

credit

44.750c

7

Sept. 13

—

MOODY'S

76,584

*51.290

SERIES—Esti¬

intermediate

consumer

Single

Sept. 13

—

Utilities

Public

Industrials

81,713

46.087

of. July 30:

consumer

Repair

$56.52

Sept. 13

A

and

as

Instalment

168

169

short

in millions

Automobile

Sept. 13
Sept. 13
Sept. 13
Sept. 13
Sept. 13
Sept. 13
Sept. 13
Sept. 13
Sept. 13

—

Baa

MOODY'S BOND

90,080

w

CONSUMER CREDIT OUTSTANDING—BOARD
OF GOVERNORS OF THE FEDERAL RE¬

EDISON

corporate

Utilities

71,810

___

Unfilled orders at end of period 4tons)—_

Sept. 7

at

Aa

Public

*84,400

of

(tons

449,000

Sept.
Sept.
Sept.
Sept.
Sept.

Aaa

Industrials

grades

2,000

Charge

DAILY AVERAGES:
Government Bonds

Railroad

of

456,000

MOODY'S BOND PRICES
Average

(tons

..304,000

QUOTATIONS):

at

(East St. Louis)

10,681,000

.

444,000

Sept. 6
;-Sept. 6

at

Louis)

(St.

Lead

all

v

.r

3

Sept. 6

York)

(New

tin

Straits

output

.

of

pounds)

Other

at

refinery

233,638,000

16,708,000

INC.—Month

7,823,000

PRICES:

Electrolytic copper—
Domestic refinery at
Export

246,348,000

export

9,190,000

Sept. 8

(E. & M. J.

and

—

*9,730,000

DUN &

(per gross ton)

METAL PRICES

10,749,000

1,648,000

domestic

INSTITUTE

smeller

mated

ton)

(per gross

Scrap steel

12,222,000

9,470,000

Sept. io

(per lb.)

steel

Finished

18,728,000

11,840,000

__

Sept.

BRADSTREET, INC
IRON AGE COMPOSITE

57,000

23,017,000

3

kwh.)

(COMMERCIAL

55,000

22,934,000

pounds)Stocks at end of period (tons)

Total

FAILURES

19,785,000

40,000

.—

Sept.

(tons)

000

zinc

195,000,000

20,779,000

(barrels)

.......

2,000

214,842,000

206,983,000

20,167,000

(barrels)-;

August:

ELECTRIC INSTITUTE:

EDISON

ZINC

Shipments

SALES INDEX—FEDERAL RESERVE
AVERAGE = 100
Sept.

STORE

DEPARTMENT

Increase all stock
AMERICAN

227,817,000

198,389,000
;li '

84,877

644,251

673,760

S. BUREAU

(U.

OUTPUT

Bituminous

154,400

(barrels)—

consumption
(barrels)
<

Sept.

State and municipal

COAL

195,261

218,596,000

(barrels)____—-

Indicated

Sept.
Sept.
Sept.

construction

Public

31,900

168,935

(barrels of 42

Refined products imports

3

652,918

output

Crude oil imports

ENGINEERING

construction

S.

Private

3,772,800

28,045

i.

^

NEWS-RECORD:
Total

3,959,100

4,218,474

INSTITUTE—Month

688,492

765,452

7,008,000

CONSTRUCTION

ENGINEERING

CIVIL

4,441,780

3,930,526
24,076

Domestic crude oil output (barrels)
Natural gasoline Output (barrels)
Benzol

Sept.
freight received from connections (no. of cars)— Sept.

Re/enue

73,403

■

(M therms)—

PETROLEUM

Total domestic production
lons each)
i

ASSOCIATION OF AMERICAN RAILROADS:
freight loaded

126,161

12,630

of

—

Revenue

127,634

16,338

4,123,537

month

'of June:

117,458,000

2

Mixed

35,364,000

2

Ago

.

AMERICAN

153,497,000

2

Year

Month

132,669

(M therms)
Natural gas sales (M therms)i.
Manufactured gas sales (M therms)

23,850,000

Previous

the U. S.

Total gas

2

Sept.

oil output

Distillate fuel

6,639,500

2

Sept.

(bbls.)

output

Kerosene

6,684.800

Sept.

(bbls.)
output (bbls.)

Gasoline

6,061,876

of that date:

OF MINES):

AMERICAN GAS ASSOCIATION—For

Sept.

galions each)
Crude runs to stills—daily average

(BUREAU

Production of primary aluminum in
(in short tons)—Month of
July
Stocks of aluminum (short

(bbls. of

42

are as

Latest

ALUMINUM

tons) end of July

output—daily average

condensate

and

either for the

are

Month

66.4

PETROLEUM INSTITUTE:

oil

Crude

(net tons)

and castings

Bteel ingots

of quotations,

cases

Ago

90.2

93.8

§95.1

Equivalent to—

AMERICAN

in

or,

33

production and other figures for the

cover

Dates shown in first column

Year

Week

Week

operations (percent of capacity).

steel

or

or

Previous

Latest

AMERICAN

(1097)

101.0

„

.100.9

■I

105.1

81.5

86.1

116.8

114.5

annual capacity of 125 828 310 tons

capacity ox 1^0,828,310 tons

Net

debt

Computed

annual

2.384%

rate

2.348%

2.292%

tEased on the producers' quotation.
tBa.sed on the average of the
quotations.
§ Average of quotation on soecial shares to plater.
^Domestic five tons or more but less than carload lot, boxed.
§§Price for tin contained.
"F.o.b. Port Colburne, U. S. duty included,
tf Aver age of dailv mean of bid and ask
"Revised figure.

nroducers*

ouotation

from

and

at

East St.

platers'

morning

session

Louis exceeds

of

0.5c.

London

Metal

Exchange,

ttDelivered where

freight

34

The Commercial and Financial Chronicle

(1098)

Thursday, September 15,1955

...

it INDICATES

Securities Now in Registration
Oil Corp.
notification) 15,000,000 shares of com¬
mon stock. Price—At par (one cent per share). Proceeds
—For mining operations.
Office—65 East Fourth South
St., Salt Lake City, Utah. Underwriter—Western States
Uranium &

Academy

June 10 (letter of

Investment Co., same city.

Louis, Mo.

(9/19-23)

July 29 filed $1,000,000 of participating junior subordin¬
ated sinking fund debentures due Sept. 1, 1970.
Pric^
—At 100% of principal amount.
Proceeds — To retire

$513,182.50 of outstanding junior subordinated deben¬
tures, series B, and for expansion and working capital.
Underwriter — Paul C. Kimball & Co., Chicago, 111.

Mo.

Admiral Finance Corp., St. Louis,

•

(9/19-23)

July 29 filed 50,000 shares of 60-cent cumulative pre¬
ferred stock (par $5) and 10,000 shares of common stock

to be offered in units of five preferred
common share.
Price — $50 per unit.
Underwriter — Paul C. Kimball & Co., Chicago, 111.
(par 10 cents)

shares

and

Allied

June
A

one

Industrial

common

and gas

300,000 shares of class

oil
Office—1508 Capitol Ave., Houston,
Paul C. Ferguson & Co., same ad¬

Price—$1 per share. Proceeds—For

stock.

operations.

Underwriter

Tex.

Development Corp.

(letter of notification)

20

•

Arcadia

Aug. 26

Metal

Products

(9/20-21)

90,900 shares of capital
(par $1), of which 23,400 shares are to be sold for
account of the company and 67,500 shares for account
of two selling stockholders. Price—$3.30 per share. Pro¬

Office—137

screw.

REVISED

inventory and improvements. Office — 324
No.'Second Ave., Arcadia, Calif. Underwriter — D. A.
Lomasney & Co., New York.

July

Grand St., New York, N. Y.

Desert

Air

Lodge,

Route

2,

Mesa,

writer—James Anthony Securities Corp.,

Under¬

mon

Mining & Development Co.
(letter of notification) 1,497,500 shares of com¬
stock. Price—20 cents
per share. Proceeds—For ex¬
1

incident

penses

to

mining

activities.

Mountain States Securities

Ariz. Under¬
New York.

it Automatic Tool Corp.'
Sept. 7 (letter of notification) 20,000 shares of common
stock (par $1).
Price—$5 per share. Proceeds—To set
up a factory and purchase equipment and machinery for
manufacture and sale of the
"grip-lock" driver and

Underwriter

—

Corp., Denver, Colo.

Bank-It-Company, Denver, Colo.
Aug.

12

series

it Arizona Cinnabar Corp., Mesa, Ariz.
Aug. 31 (letter of notification) 300,000 shares of common
stock (par one cent).
Price—$1 per share. Proceeds—
To increase capacity of mill recently constructed. Office
—400

ISSUE

writer—Ellis-Greenberg Co., 1051 Carroll St., Brooklyn,

ceeds—For

(letter

of

notification)

debentures

$100,000

of 6%

second

dated

Aug. 1, 1955 and due serially
Price—At par (in denominations of
$100 each). Proceeds—To help pay in part the cost of a
new
plant. Office—2590 Walnut Street, Denver, Colo.
from

1958 to

1961.-

Underwriters—Peters, Writer & Christensen, Inc.
Garrett-Bromfiel d & Co., both of
Denver, Colo.

and

Bassons

Industries Corp.
(letter of notification) 124,(1)00 shares of com¬
(par 50 cents). Price—$2 per share. Proceeds
—For working capital, etc.
Office — 1424 East Farms

Aug. 24
mon

stock

Road, New York City.
& Co., New York.

Underwriter—Jay W. Kaufmann

—

dress.

NEW

Credit Corp., Reno,

Nev.
shares of 7% cumu¬
lative preferred stock (par $10) and 27,000 shares of
common
stock (par $1) to be offered in units of one
share of each class of stock. Price—$11 per unit. Pro¬
ceeds—For working capital, etc.
Office—206 No. Vir¬
ginia St., Reno, Nev. Underwriter—Senderman & Co.,
Allstates

ITEMS

•

PREVIOUS

Balboa

(letter of notification)

stock

Admiral Finance Corp., St.

•

etc.
Office—Miami, Fla. Underwriter—Merrill Lynch,
Pierce, Fenner & Beane, New York. Offering—Expected
today (Sept. 15).

ADDITIONS

SINCE

ISSUE

CALENDAR

June 27 (letter of notification) 27,000

same

September 16
(Offering

share of each class of stock. Price

one

Finance

related

activities

for

and

contingencies, stock in trade,
working capital. Underwriter—None.

Alouette

Uranium & Copper Mines,

—

The First

Common

(Offering to stockholders—no underwriting) $48,683,100

(Monday)

&

October 3

$1,000,000

Co.)

Admiral Finance Corp
(Paul

C.

Preferred & Common

Kimball

&

$500,000

Co.)

Barium

(Eastman,

Dillon

Co.)

&

Common

$300,000

Clad

Steel

Fiberglass,

(J.

J.

Ricrdan

Common

Inc...-.

&

Co.,

Inc.)

$300,000

(Republic of)__
(Allen
*

•

Co.)

Metal

(Victor V.)

A.

Co.)

&

stock.

Price—One

incident

to

share.
activities.

per

mining

Weber Investment Co.,
American

cent

Kerner,

&

$28,390

Inc.)

Processing Co.,
Aug. 11 (letter of notification) 300,000
stock (par 10 cents).
Price—$1 per
For plant and equipment and other

Higginson

Corp.)

100,000

J

^

& Sessions Co

com¬

Preferred
&

Co.)

share.

Columbia

Gas

general corporate
Offices—743 E. Penn Street, Philadelphia, Pa.;
1131 Healey Building,
Atlanta, Ga. Underwriter—

and

Securities

Puerto Rico

EDT)

a.m.

11

St.

$22,000,000

11:30

EDT)

$40,000,000

Aug.

2

vertible

Telephone

filed

up

Telegraph Co.
to $637,165,800 of 12-year 3%%

debentures

due

con¬

debentures

are

to be convertible into

common

stock be¬

cash.

Price—At face amount.

tion program.
•

Proceeds—For construc¬

(Israel

Sachs

197,532

the

&

will

Co.

of

Co.;

^....Preferred

Drexel & Co.;

Dayton, Ohio; and for working capital,

Common

13

&

Co.

(Barrett

Herrick

(Bids

(Friday)

be

to

Worcester County

.Bonds

Inc.)

(Bids

underwriting)

503,155

shares

invited)

Co.,

Kidde

Servo

..Debens. & Com.

Inc.)

be

&

Co.)

19

October 26

(Bids

Corp.

Common

&

of

53,700

by

Carl

M.

Chemical

be

Heine &

'

Southern

(Territory of)

stockholders—bids

11

November 16

110,000^shares

(Thursday)

(Tuesday)
Common

to

(Bids

to

be

a.m.

EDT)

1,507,303

shares

(Wednesday)
Bonds

invited)

$7,500,000

Common
(Bids




^.Common

Co.

(Offering

Common

Co

$15,000,000

(Thursday)

November 1

$35,000,000

Haupt & Co.) $600,000

of America

Bonds

invited)

(Offering to stockholders—underwritten by Lehman Brothers;
Goldman, Sachs & Co.; and The First Boston Corp.) 209,685 shs.

Debentures

11

a.m.

EDT)

Pennsylvania RR.

Cleveland

(Wednesday)

Preferred

Corp

America

to

Hawaii

(Bids

1,068

November 29

shares

Equip. Trust Ctfs.
noon

EDT)

September 30
Household Finance Corp

offices

Bonds

$25,000,000

Indianapolis Power & Light Co

and Dean Witter & Co.)

(Ira Haupt & Co.),

all

Bonds

$8,500,000

(Wednesday)

October 27

Loeb,

shares

(Wednesday)

September 29

to

(Tuesday)

invited)

$9,135,000

stockholders—underwritten

First Boston Corp.

Servo Corp.

Private Wires

..Debentures
$30,000,000

(Bids to be invited)

(Walter) & Co., Inc

(Ira

San Francisco

Common

$900,000

Electric Co

to

October

September 27 (Tuesday)

(The

Philadelphia

Co., Inc.)

Long Island Lighting Co

Kaiser Aluminum

Chicago

&

New York State Electric & Gas
Corp

(Monday)

Continental Production Corp

September 28

Pittsburgh

(Monday)

$30,000,000

Common

California

Common

$450,000

Co.)

Southern Bell Tel. & Tel. Co

;

Rhoades

Boston

(Thursday)

Mines, Inc

October 17

Equip. Trust Ctfs.

to stockholders—no

(Offering to

New York

2,610 shares

$9,390,000

Corp

(First

Common

$17,250,000

Co.)

Fort Pitt Packaging
International, Inc.

and

$25,000,000

& Co.)

September 26

the

Co.

Forgan

September 23

(Offering

The

(Tuesday)

October 18

outstanding $300,000 4J/2% first preferred
stock (par $100); to purchase stock of Reliable Fire In¬

surance

Class A
$300,000

Co.)

(Bids noon EDT)

Steel

by

(Monday)

&

EDT)

p.m.

(Tellier

Detroit Steel Corp

and 100,000 shares for the account of a
selling stockholder. Price—$10 per share. Proceeds—To

3

October

(Thursday)

Southern Pacific Co

Detroit

underwritten

195,312 shares

Mills.

Rio de Oro Uranium

(Probably Morgan Stanley

company

redeem

&

(I-Ialsey, Stuart &

American Title & Insurance Co.

Peabody

shares

Public Service Electric & Gas Co

Underwriter—None.

Aug. 26 filed 300,000 shares of common stock (par $2),
of which 200,000 shares are to be sold for the account of

Cotton

(Eids

Medallion Pictures Corp

,

Common

Corp.)

Common

stockholders—Goldman,

dealer-manager)

Glore,

Boston

October 11

Spray

125,714 shares

Co.)

to

Oct.

(Friday)

$2,500,000

be

ginning Dec. 13, 1955, at $148 per share, payable by sur¬
render of $100 of debentures and
payment of $48 in

$3,000,000

Corp

stockholders—may be

(Kidder,

Common

&

September 22

13, 1967, being offered
for
subscription by stockholders of record Aug. 25,
1955, on the basis of $100 of debentures for each eight
shares held; rights to expire on Oct.
13, 1955.
The

Preferred
dealers)

October 10

Bonds

EDT)

noon

Tampa Electric Co

&

local

International Resources Fund, Inc..

Underwriter—None.
American

to

Debentures

Inc

a.m.

Croix Paper Co..;

(Offering

Debentures

(Wednesday)

(Capital of)...

Estabrook

Investors, Inc., Dallas, Texas
July 15 filed 800,000 shares of common stock (par $1).
Price—$10 per share. Proceeds—For working capital, etc.

by

Rochester Telephone
(Offering

(Offering to stockholders—underwritten by

American Republic

Bonds
$10,000,000

(Wednesday)

October 7

$6,000,000

EDT)

a.m.

System;

(Bids

Co., Atlanta, Ga.

Crerie

H.

(Tuesday)

EDT)

noon

(Expected

Bonds

(Bids

purposes.

Franklin

11

September 21

Proceeds—

F.

Pacific Power & Light Co

$3,000,000

Co
(Bids

Ga.

and

$1,500,000

(Bids 11 a.m. EDT) $35,000,000

First

common

..Common

Inc.

Inc.)

Preferred

(Bids

Ohio Power

Underwriter—

shares of

Corp

Otis,

Co.,

October 5

shares

Ohio Power Co

Atlanta,

$300,000

Public Service Electric & Gas Co

Ogden, Utah.

Mica

Inc.)

Common

(Lee

(McDonald

Proceeds—For

Co.,

Pacific Power & Light Co._

$209,970

Cameo, Inc.
Lamson

&

&

(Bids

.Preferred

Close

Common
&

October 4
Common

Lomasney

((Rambo,

Underwriter—

Uranium, Inc.
July 27 (letter of notification) 6,500,000 shares of
expenses

Co
Herrick

Yellowknife Uranium

(Tuesday)

Corp

Budget Plan

88,000,000

$3,000,000

Products

(D.

Debentures
Corp.)

'

•*

September 20
Arcadia

Common
200,000 shares

Corp.)

Higginson

Bonds

&

'

Boston

Corp

(Barrett

Consolidated

Amarilla

mon

Fir.it

(Lee

Commonwealth Life Insurance Co

(Monday)

Aluminum Co. of America
(The

Cuba

• Aluminum Co. of America (10/3)
Sept. 13 filed 200,000 shares of common stock (par $1).
Price
To be supplied by amendment.
Proceeds—To

Davis, Chairman of the Board.
Boston Corp., New York.

Co.

(Gearhart

Inc.,

Montreal, Canada
July 22 (Regulation D) 1,000,000 shares of common stock.
Price—30 cents per share. Proceeds—For exploration and
development expenses, etc. Underwriter—Hudson-Bergen
Securities, Inc., Cliffside Park, N. J.

Arthur V.

by

Debentures

Kimball

(Saturday)

Mountain States Telephone & Telegraph

$291,000

Corp

C.

(Paul

—$11 per unit. Proceeds—For construction of hotel and
and

Brothers)

September 19
Admiral

offered in units of

October 1

Class A

.stockholders,—underwritten

to

Lehman

address.

Aloha, Inc., Las Vegas, Nev.
Aug. 8 filled 900,000 shares of common stock (par $1)
and 900,000 shares of preferred stock (par $10) to be

(Friday)

Dakamont Exploration Corp

$7,965,000

(Bids

(Friday)
Common

(Offering to stockholders—underwritten by Lee Higginson Corp.;

White, Weld & Co.; and William Blair & Co.) 341,380 shares

(Tuesday)

San Diego Gas & Electric Co
11:30

a.m.

December 6

..Bonds

EDT)

$18,000,000

(Tuesday)

Virginia Electric & Power Co...
(Bids

to

be

invited)

$12,500,000

Preferred

Volume 182

Number 5464

...

The Commercial and Financial Chronicle

(1099)

Big Owl Uranium Mines
(letter of notification) 2,000,000 shares of

July 29

stock.

mon

incident

penses

com¬

Price—15 cents per share. Proceeds—For

mining activities.
Colo.

to

Underwriter

ex¬
—

Cranmer & Co., Denver,

it Ch^dipaBMinlng Co., Denver, Colo.
1 (letter of notification) 1,062,000 shares of com¬
stock. Price—At par (25 cents per share). Proceeds
—For mining operations.
Office — 215 First National
Bank Bldg., Denver, Colo. Underwriter—None.
Charleston

common

Aug.

1

Parking

voting

common

shares

of

Blcig., Spokane, Wash. Underwriter—Standard Securities
Corp., same city.
Hills Uranium & Minerals Corp.
(letter of notification) 1,200,000 shares of non¬
assessable common stock
(par one cent).
Price — 25
cents per share.
Proceeds—For mining expenses
Ad¬
dress—P. O. Box 1363, Rapid City, S. D.
Underwriter—
Black

Aug. 11

Morris Brickley, Harney Hotel, Rapid

City, S. D.

Black Panther Uranium

Co., Oklahoma City, Okla.
July 12 filed 500,000 shares of common stock (par 10
cents).
Price—$1 per share. Proceeds—To explore and
drill leases and claims in

Porter,

Stacy

&

Co.,

State of Utah.

Houston, Tex.,

Underwriter—

on

"best

efforts

basis."

Biackstone

Uranium

Mines, Inc., Denver, Colo.

Aug. 3 (letter of notification)

15,000,000 shares of com¬
mon
stock (par one cent).
Price—2J/2 cents per share* j
Proceeds—For expenses incident to mining activities.
Office—801 Custis Street, Denver, Colo. Underwriter—
Columbia

Securities

Co., Inc.,

city.

same

Denver, Colo.
July 29 (letter of notification) 1,000,000 shares of com¬
stock

Price — 30 cents per share.
incident to mining operations.
Office—612 Kittredge Bldg., Denver, Colo. Underwriter
—Peters, Writer & Christensen* Inc., Denver 2, Colo. .
Proceeds

(par 10 cents).
For expenses

—

Bojo Uranium Co., Salt Lake City, Utah
July 8 (letter of notification) 3,000,000 shares of com¬
mon
stock.
Price—At par (10 cents per share); Pro¬
ceeds—For expenses incident to mining operations. Of¬
fice—403 Felt Building, Salt Lake City, Utah.
Under¬
writer—J. E. Call & Co., Salt Lake City, Utah.
•

Boren

Oil

&

Gas

offered

share.

ing

Corp.

Cook Industries,
Inc., Dallas, Texas
Aug. 1 (letter of notification) 199,999 shares of common
stock (par
$1), of which 107,915 shares are to be sold
by company and 92,084 shares by a selling stockholder.

Inc..

120,000 shares of

non¬

stock, class A—(par 50 cents) and 60,000
common stock, class B (par 10 cents)

Price—$1.50

voting

in

units of

two

class

A

and

class

one

B

Texas.

per unit. Proceeds—For general work¬
Office—505 National Bank of Commerce

Building,

Charleston, W. Va.
Investment Co., same address.

tal

Proceeds—For

mining operations. Office—65
South, Salt Lake City, Utah. Underwriter

Salt Lake City, Utah
Aug. 10 (letter of notification) 7,000,000 shares of capital
slock
(par one cent).
Price—Three cents per share.
Proceeds—For mining expenses, etc.
Office—2630 South
2nd West, Salt Lake City, Utah.
Underwriter—Denver
Securities, Inc., Denver, Colo.
>
Clad

stock

debentures

each

for

100

stock.

shares

(or. fraction

thereof)

common

held; rights to expire on Sept. 23.
Price—At 100%
of principal amount.
Proceetis—To pay current debt;
for drilling expenses and development program.
Office
—Wichita Falls, Tex.
Underwriters—Burt, Hamilton &
Co., Inc., Dallas, Tex.; and N. R. Real & Co., Jersey City,

tion

to be offered pub¬

per

Corn..

—For

N.J.

—

To

be

Chicago, 111.

Bldg., Washington 4, D. C.

it Budget Plan Corp.

stock

(par

Securities,

(9/20)

Sept. 7 (letter of notification)

Inc.,

mon

Underwriter

Proceeds—For

Rambo, Close & Kerner, Inc., Philadel¬

—

9

filed

116,832

shares

of

stock

(par $5)
being offered in exchange for all of the issued and out¬
standing capital stock of Goodman Lumber Co., Good¬
man, Wis., on the following basis: ,18 shares for each
share cf Goodman common stock; eight shares for each
share of Goodman 2nd preferred stock; and eight shares
for each share of Goodman 1st preferred stock; offer to
terminate on Sept. 15, 1955 (subject to withdrawal by
Calumet if the required number of Goodman shares have
not been deposited and accepted within 30 days from the
date of the mailing of the prosoectus to the Goodman
stockholders).
tive
•

Underwriter

—

None.

Statement

effec¬

July 20.

Cameo,

Inc.,

Houston, Texas

(9/29)

Sept. 1 filed 100,000 shares of common stock (par $1), of
which 75,000 shares are to be for account of company
and

25,000 shares

Board.
—To

for Paul R. Mills, Chairman of the

Price—To be supplied

acquire six trucks; to

note;

and

by amendment. Proceeds

repay

for working capital.

a

$120,000 6%

Underwriter—Lee

serial

Hig-

ginson Corp., New York.
Canadian Uranium

Mines, Ltd., Montreal, Canada
June 3
(regulation "D") 2,000,000 shares of common
stock (par one cent). Price4-15 cents per share. Pro¬
ceeds—For exploration and development expenses. Un¬
derwriter—Tellier & Co., Jersey City, N. J.
Caribou Ranch Corp., Denver, Colo.
July 15 filed 505,000 shares of common stock (par $1.)
Price—$4 per share. Proceeds—For acquisition of prop¬

erty and equipment, construction of additional facilities,
Underwriter—Mountain States Securities, Inc., Den¬

etc.

ver,

Colo.

Cedar

June 8

Springs Uranium Co., Moab, Utah
(letter of notification) 300,000 shares of

common

Price—$1 per share. Proceeds—
For mining expenses.
Underwriter—Universal Invest¬
ment Corp., Washington, D. C.
stock

(par five cents).

it Chatfin Uranium Corp., Salt Lake City, Uta'i
Sept. 6 (letter of notification) 12,500,000 shares of non¬
assessable capital stock.
Price—At par (one cent per
share).
Proceeds — For expenses incident to mining
activities. Office—810 Deseret Building, Salt Lake City,
Utah. Underwriter—Utah Securities Co., same City.




stock

Grand
common

Lake

City,

Utah;

and

(par

expenses

Vista
—

cent).

Christensen, Inc., Denver, Colo.

com¬

Cross-Bow Uranium Corp.
Aug. 29 (letter of notification) 5,000,000 shares of com¬
mon
stock.
Price—At par (six cents per share).
Pro¬
ceeds
For mining operations.
Office
1026 Kearns
Bldg., Salt Lake City, Utah. Underwriters—Potter In¬

Seaboard

—

—

vestment

• Cuba
(Republic of)
(9/19-23)
Aug. 10 filed $3,000,000 of Veterans, Courts and Public

mining operations.
Junction, Colo.
Securities
Co., Denver and

Road,

Columbia

Grand

Works

which

tion

development

and

for

and

Main

expansion

cents).

Community Credit Co., Omaha, Neb.
June 6
(letter of notification)
1,000 shares of- 5%%
cumulative preferred stock.
Price—At par ($100 per
share).
Proceeds—For working capital.
Office—3023
Farnam St., Omaha, Neb. Underwriter—Wachob-Bender
Corp., same city.

Coeur d'Alene,

Idaho.

Underwriter—M. A. Cleek, Spo¬

kane, Wash.
Conlon-Moore

Corp., Cicero, III.
Aug. 29 (letter of notification) $300,000 of first mortgage
(secured) 5% sinking fund bonds, series A, dated Oct. 1,
1955, to mature Oct. 1, 1967. Price — $100 per bond.
Proceeds—To redeem

outstanding first mortgage sinking
South 52nd Ave., Cicero, 111.
Underwriter—Illinois Securities Co., Joliet, 111.
,

fund

bonds.

Office—1806

•

Consolidated Fiberglass, Inc. (9/19)
Aug. 4 (letter of notification) 200,000 shares of common
stock (par 10 cents). Price—$1.50 per share. Proceeds—
For advance to Alumin-Aire, Inc., a subsidiary, and for
acquisition of, advances to and investment in other com¬
panies that may be organized or acquired. Office—118
West 22nd St., New York City. Underwriter—J. J. Riordan & Co., Inc., New York City.
•

Continental

Production

Corp. (9/26-30)
Aug. 29 filed $3,700,000 of 15-year 5V2% income de¬
bentures due Sept. 1, 1970 and 870,000 shares of common
stock (par 10 cents) to be offered in units of $50 of
debentures

and

five

shares

of

stock.

Price—$50.50 per

Price—To

98%

at

Romenpower

received

them

in

and

be

Eletra

Construction

consideration

Underwriter—Allen

&

supplied by
interest).

accrued

of

Co., New York.

Price—To be supplied by amendment.

acquisitions

and

advances

Co.

construc¬

(par 50
Proceeds

to

subsidiary (Cuban
Drilling & Exploration Co.) for drilling and
exploration costs. Underwriter—Dallas Rupe & Son, Inc.,

Dallas, Tex.

,

• Dakamont
Exploration Corp. (9/16)
Aug. 24 (letter of notification) 291,000 shares of class A
stock, to be offered to common stockholders on the basis

of three shares of class A stock for each
common

Sept. 27.
expenses

San

Conjecture Mines, Inc., Coeur d'Alene, Idaho
May 5 (letter of notification) 200,000 shares of common
stock (par 10 cents).
Price—25 cents per share. Pro¬
ceeds—For mining expenses. Office—326 Wiggett Bldg.,

1983.

American

Un¬

South

work.

—For

life

St., Tulsa, Okla.
derwriter—Eastman, Dillon & Co., New York, N. Y.

Office—616

To

—

had

due

(expected

it Cuban American Oil Co., Dallas, Texas
Sept. 9 filed 2,000,000 shares of common stock

Commonwealth Life Insurance Co.
(9/19)
Aug. 22 (letter of notification) 60,000 shares of common
stock (par $1).
Price—$5 per share. Proceeds—To be
credited to capital stock, unassigned surplus and reserve
business

%bonds

Proceeds

Underwriter—None.

reserves.

4

amendment

Junction, Colo.

it Commonwealth Credit Corp., Phoenix, Ariz.
Sept. 9 filed 700,000 shares of capital stock (par $1).
Price—$2 per share. Proceeds—For working capital, etc.

for

Co., and Mid-America Securities, both of Salt
City, Utah.

Lake

com¬

Price—Two cents per share.

incident to

Grand

10

Proceeds—For mining expenses. Office—404
University
Building, Denver, Colo. Underwriter—Peters, Writer &

Uranium

one

(par

a
selling
Christi, Texas. Underwriter

Cortez Uranium &
Mining Co., Denver, Colo.
May 27 (letter of notification) 3,000.000 shares of com¬
mon
stock (par one cent).
Price—10 cents per share.

Underwriters—Mid America

Mines, Inc.
July 12 (letter of notification) 15,000,000 shares of

Underwriter

Calumet & Hecia, Inc.
June

Commercial

Office—170

■

Salt

stock

Proceeds—To

—None.

de¬

Securities Corp., Washington, D. C.

2,839 shares of 6% cumu¬
lative preferred stock.
Price—At par ($10 per share).
Proceeds—For working capital.
Office—3 Kings High¬
way East, Haddonfield, N. J.
Business — Small loans.

phia, Pa.

Price—At the market.
stockholder. Office—Corpus

cent).

one

State

cents).

Price—Five cents per share.
Proceeds—For mining operations. Office—501 Perpetual
mon

Under¬

incident

expenses

South

Corpus Christi Refining Co.
,
Sept. 2 filed 500,000 shares of common

bidding. Probable bidders: Haisey, Stuart & Co. Inc.; Morgan Stanley & Co.
Bids—
Expected to be received up to 11:30 a.m. (EDT) on
Sept. 21.
it Comet Uranium Corp., Washington, D. C.
Aug. 20 (letter of notification) 700,000 shares of

Parkway East, Corning, N. Y.

Colorado.

termined by competitive

Brutrcing (Charles) .Co., Inc., Chicago, III.
Sept. 2 filed 136,400 shares of common stock (par $3).
Price—To be supplied by amendment. Proceeds—To sell¬
ing stockholders. Underwriter — William Blair & Co.,

Denison

to mining activities.
Office—
St., Room 211, Salt Lake City, Utah.
Underwriter—Mountain States Securities Corp., Denver,

343

System, Inc., New York (9/21)
25 filed $40,000,000 of debentures, series E, due
Proceeds—To repay $20,000,000 of bank loans and
Underwriter

l-for-8 basis (with an
oversubscrip¬

a

Coronado Uranium
Corp., Salt Lake City, Utah
Aug. 16 (letter of notification) 2,400,000 shares of com¬
mon stock.
Price—At par (10 cents per share). Proceeds

Offering

Gas

program.

on

on Sept. 26. Price—$14.75
Proceeds—For construction program. Office

writer—None.

notification) 300,000 shares of common
stock (par 20 cents).
Price—$1 per share. Proceeds—
For oil and mining activities.
Office
350 Equitable
Bldg., Denver, Colo. Underwriter—Birkenmayer & Co.,
same city.

construction

Sept. 6

privilege); rights to expire
share.

-27-29

Colorado Oil & Uranuim Corp.

for

common

—

record

June 7 (letter of

1980.

Denver, Colo.
notification) 2,995,000 shares of

Price—At par

•
Corning Natural Gas Corp.
Aug. 26 (letter of notification) 11,000 shares of common
stock (no par) being offered to common
stockholders of

stock (par one

Investing

Pro¬

(10 cents per share). Proceeds—
mining operations. Offices
738 Majestic
Bldg.,
Denver, Colo., and 317 Main St., Grand
Junction, Colo.
Underwriter—Lasseter & Co., Denver, Colo.

Uranium, Inc., Montrose, Colo.

New York; and Shaiman & Co.,
Denver, Colo.
—Expected sometime in October.

Aug.

Price—Five cents per share.

For

licly. Price—50 cents per share. Proceeds—For explora¬
tion and development expenses and for general corpor¬

Columbia

cent).

one

Cordillera Mining
Co.,

—

July 26 filed $600,000 of 6% convertible debentures due
Sept. 15, 1975, being initially offered for subscription by
stockholders of record July 15 on the basis of $100 of

(par
Lake

June 8 (letter of

—

Underwriters—General

& Mining Co.
notification) 5,000,000' shares of capital

mining expenses. Office—65 East 4th
South,
City, Utah. Underwriter—Empire Securities
Corp., same city.

Salt

Mountain States Securities Co., Denver,
Colo.; and Joseph McManus & Co., New York, N. Y.

purposes.

city.

ceeds—For

Aug. 24 filed 400,000 shares of common stock (par 10
cents).
Price—$1.25 per share.
Proceeds—To
repay
short-teifln obligations, etc. and for working capital.

ate

same

June 24 (letter of

Clad-Rex Steel Co., Denver, Colo.

are

Corp.,

4th

Empire

Copper Blossom Uranium

Co., Philadelphia, Pa. (10/3)
June 17 (letter of notification) 120,000 shares of common
stock (par 25 cents). Price—$2.50 per share. Proceeds—•
For equipment and working capital. Underwriter—Bar¬
rett Herrick & Co., Inc., New York.

April 21 filed 2,960,000 shares of
cent), of which 2,500,000 shares

East

—

Securities

(VictorV.)

Colohoma

Copper Blossom Uranium & Mining Co.
(letter of notification) 5,000,000 shares of capi¬
stock (par one cent).
Price—Five cents per share.

June 24

Underwriter—Crichton

Cisco Uranium Corp.,

•

per share. Proceeds—For general corporate
Underwriter—Central Securities Co., Dallas,

purposes.

Price—$5

capital.

Underwriter

Blercwood Mining & Uranium Corp.,

mon

be

to

Service,

(letteij- of notiiication)

—For

cents). Price—25 cents per share. Proceeds
mining expenses. Office — 303 Lincoln Savings

Proceeds—For acquisition of production
payments.
Vegas, N'ev. Underwriter—First California
Co., Inc., San Francisco, Calif.
Office—Las

mon

it Big Smoke Uranium, Inc., Spokane, Was'i.
Sept. 7 (letter of notification) 800,GOO shares of

unit.

Sept.

stock (par 10

35

man

held

of Sept.

as

Price—At par

incident to oil and gas activities.

Jacinto

Bldg., Houston, Texas.
Brothers, New York, N. Y.

Dawn Uranium & Oil
June 16
mon

five shares of

15, 1955; rights to subscribe on
($1 per share).
Proceeds—For

Co., Spokane, Wash.

(letter of notification)

stock.

Price

—

10

cents

uranium and oil exploration.

Empire State Bldg.,

Office—1077

Underwriter—Leh¬

same

1,500,000 shares of

per

share.

com¬

Proceeds—For

Office—726 Paulsen Bldg.,

city.

• Detroit Steel
Corp. (9/23)
Aug. 30 filed $30,000,000 of first mortgage sinking fund
bonds due 1970. Price—To be supplied by amendment.
Proceeds—Together with other funds and issuance of
$6,000,000 in 6% cumulative preferred stock at par ($100
per share) to retire RFC note amounting to $38,180,000.

Underwriter—Halsey, Stuart & Co. Inc., Chicago and
l^ork. Meeting—Stockholders to vote on approving
financing on Sept. 16.

New

• Detroit Steel
Corp. (9/23)
Aug. 30 filed 503,155 shares of common stock (par $1),
to be offered for subscription by common stockholders
of record Sept. 22 on the basis of one new share for each

five

shares

held

rights to expire

(with

on

an

Oct. 10.

oversubscription privilege);
Price—To be not

more

than

80% of the market price immediately prior to the offer¬

ing.

Proceeds—To help retire RFC note.

None (see also proposed bond financing

Underwriter—
above).

Continued

on

page

36

36

The Commercial and Financial Chronicle

(1100)

Fort Pitt

shares of non¬
(five cents per
share).
Proceeds—For mining expenses.
Office—290
North University Ave., Provo, Utah.
Underwriter
Utah.

Investment Co., Provo,

Inc., Denver, Colo.

Omaha, Neb.

(letter of notification) 1,300,000 shares of com¬
cent). Price 20 cents per share Pro¬

July 12

expenses

Price—$22

Gallina Mountain Uranium Corp.
July 29 (letter of notification) 500,000 shares of common
stock
(par one cent). Price—An aggregate of $50,000.
Proceeds—For mining expenses. Office—82 Beaver St.,

New

held

shares

16

1r Gas Hills Uranium Co., Laramie, Wyo.
Aug. 20 (letter of notification) 2,900,000 shares of com¬
stock (par one cent). Price — 10 cents per share.
Proceeds—For mining operations
Office—1918 Thornburgh Drive, Laramie, Wyo. Underwriter—None.

(with

• General
Capsule Corp., Fraser, Mich.
Aug. 9 (letter of notification) 285,000 shares of class A
common stock (par 10 cents).
Price—$1 per share. Pro¬

oversub¬

an

ceeds—For

equipment and engineering; inventory, pro¬
sales and working capital.
Office — 31425
Fraser Drive, Fraser, Mich.
Underwriter—General In¬
vesting Corp., New York, N. Y. Offering — New being

scription privilege); rights to expire
$21

share.

per

Office —2509

West

Berry

Underwriter—None.

1c Energy Fund,

Street,

Fort

Worth,

motion

Texas.

'

New York

Inc.,

• General
Guaranty Insurance Co.
Aug. 26 (letter of notification) 50,000 shares of common
stock (par $2.50) to be offered for subscription by stock¬

Price—At

stock.

common

Proceeds—For investment.

Erie

County Investment Co., Sandusky, Ohio
Aug. 10 (letter of notification) 7,500 shares of cumula¬
tive preferred stock (par $20) and 7,500 shares of com¬

holders of record Aug. 25, on a

surplus.

(par $10), to be offered in units of one share
Price—$35 per unit.
Proceeds—For working
capital to finance general expansion.
Office—169 East
of

—

Lake

City, Utah. Underwriter
Co., Las Vegas, Nev.

Cafarelli

Eliason,

—

to

Price—At 100%

ments

necessary

other state laws.

Underwriter—None.

^ Farrington Manufacturing Co.
Aug. 19 (letter of notification) 3,500 shares of class A
common stock (par $1). Price—At market
(around $14.25
per share).
Proceeds — For working capital. Office—
Needham Heights, Mass.
Underwriter—Chace,
West & Winslow, Inc., Boston, Mass.
•

Whiteside,

Properties, Inc.
Aug. 17 filled $7,691,250 of 20-year debentures due Sept.
1, 1975, and an aggregate of 2,342,075 shares of common
(par

cent),

one

of

1,692,075 shares of stock
tion

by

which

are

the

deebntures

and

being offered for subscrip¬

stockholders of Food Fair

common

of record

50

Richards

St., Salt Lake City,

nell, Inc., Denver, Colo.

Sept. 13

on

Stores, Inc.
the basis of $50 of debentures and

11 shares of stock for each 20 shares of Food Fair Stores

Mining & Uranium Corp.
July 29 (letter of notification) 1,000,000 shares of

The
be

for

the

Food
ments

650,000

Fair

shares.

Stores

thereon.

two

Proceeds

tracts

Underwriter

of
—

—

land

To

purchase from

and

for

improve¬
Eastman, Dillon & Co.,

New York.

Foremost

Dairies, Inc.

Aug. 18 filed 202,925 shares of common stock (par $2)
to be offered in exchange for
43,807 shares of second
preferred and 3,349 shares of

delphia

Dairy

Products

shares of Foremost
ferred
one

share

and

Philadelphia

Co.,

common

five




Inc.,

on

for each

shares

common

common

of

stock

the

of

basis

Phila¬
of

Philadelphia

Foremost

4)4
pre¬

common

share. Underwriter—None.

for

of

60

shares of stock

and one $100
debenture, or
Price—$400 per unit. Proceeds—For
working capital. Underwriter—None. O. Strother Simp¬
son, of Tulsa, Okla., is President.

Housatonic

Public Service
Corp.
Aug. 15 (letter of notification) 11,225 shares of common
stock (par $15) being offered for
subscription by com¬
mon stockholders of record
Aug. 23 on the basis of one

share for each 33

shares held; rights to
expire on
Price—$22 per share.
Proceeds—For con¬
struction expenditures.
Office—33 Elizabeth St.,
Derby,
Conn.
Underwriter—None.

Sept.

26.

1c Household Finance Corp.
Sept. 9 filed 341,380 shares of

(9/30)
common

stock

($9 stated

value) to be offered for subscription by common stock¬
holders of records Sept. 30, 1955 on the basis of one new
share for each 20 shares held; rights to expire on Oct. 17.
Price—To be supplied by amendment. Proceeds—To re¬
duce bank loans. Underwriters—Lee

White,

Weld

& Co., both
Co., Chicago, 111.

mon

stock.

Price—30 cents per share.

Proceeds

com-

—

For

incident to mining activities. Underwriter
Peters, Writer & Christensen, Denver, Colo.

expenses

—

Gob Shops of America, Inc.
July 27 (letter of notification) 99,000 shares of common
(par $1). Price—$3 per share. Proceeds—For gen¬
eral corporate purposes.
Office—Pawtucket, R. I. Un¬
derwriter—Weill, Blauner & Co., Inc., New York.

stock

Great Eastern Mutual
stock

Life Insurance Co.

(letter of notification) 45,583 shares of common
(par $1) to be offered for subscription by stock¬

holders of record June 10 in the ratio of one new share
for each three shares held; stock not subscribed for

by
Sept. 10, 1955 will be offered to public. Price—To stock¬
holders, $3 per share; and to public, $5 per share. Pro¬
ceeds—To increase capital and surplus accounts.. Office—
210 Boston Bldg., Denver, Colo. Underwriter—None.
Half Moon Uranium
Corp., Ogden, Utah
Aug. 10 (letter of notification) 8,000,000 shares of capital
stock.
Price—At par (two cents per share).
Proceeds
—For mining expenses. Office—E-17
Army Way, Ogden,

Utah.

Blair &

of

New

Higginson Corp. and
York; and William

Hunt Uranium Corp., Green
River, Utah
Aug. 22 (letter of notification) 1,200,000 shares of com¬
mon
stock.
Price—At par (25 cents per share).
Pro¬
ceeds-—For expenses incident to mining activities.
Un¬
derwriter
Elmer K. Aagaard, 323 Newhouse
Bldg.,
Salt Lake City, Utah.
—

1c Indian Monument Uranium Mining Corp., Reno,
Nevada

Sept. 6

(letter of notification)

stock

mon

Proceeds

Underwriter—United

Intermountain

(par

—

one

For

Brokerage

Corp., Ogden, Utah.

expenses

Industrial

Ney. Underwriter

Hardware

Mfg. Co.
May 12 (amendment) $1,500,000 of 5% debentures dua
1975 and 30Q,000 shares of common stock (par 50
cents),
of

which

85,000 shares

are to be sold to Seymour and
$5 per share. Price—To be sup¬
plied by amendment. Proceeds—To purchase Hugh H,
Eby Co. and Wirt Co. Underwriters—Hallowell, Sulz¬
berger & Co., Philadelphia; and Baruch Brothers & Co.,

Bernard

Inc. and

Offerman

at

Weill, Blauner & Co., Inc., both of New York.

Inland Oil &

Uranium Corp., Denver, Colo.
July 18 (letter of notification) 1,200,000 shares of com¬
mon
stock (par 10 cents).
Price — 25 cents per share.
Proceeds—For expenses incident to oil and gas activities.
Office—3975 East 58th Ave., Denver, Colo. Underwriter

—Shaiman &

Co., Denver, Colo.

International

Investors Inc., New York
Aug. 23 filed 200,000 shares of capital stock
Price—At market.

Proceeds—For

(par $1).

investment.

Business

invest in foreign securities of the free world out¬
side of the United States.
Underwriter—I. I. I. Securi¬

—To

Corp., 76 Beaver St., New York, N. Y.

1c International Sound Films, Inc., Atlanta, Ga.
Sept. 8 (letter of notification) 560 shares of common
stock (par $10) and 300 shares of 6% preferred stock
(par $100). Price—At par. Proceeds—For expansion of
Office—220 Pharr Road, N. E., Atlanta, Ga.

•

Interstate Amiesite

July
due

Corp.
19 filed $438,200 of 5^2%

convertible debentures
1965, being offered first for subscription by stock¬
at the rate of $100 of debentures for each 16

holders

shares held as of Sept.
1
(with an oversubscription
privilege); rights to expire on Sept. 30. Proceeds—For
working capital. Business—Bituminous concrete paving

materials.
Del.

Office—Delaware Trust Bldg., Wilmington 99,

Underwriter—None.

lola Uranium Corp.
July 26 (letter of notification) 1,200,000 shares of com¬
mon
stock (par one cent).
Price—25 cents per skare.
Proceeds—For mining costs. Office—1414 So. Michigan
Avenue, Chicago 5, 111. Underwriter—Columbia Secu¬
rities Co., Denver, Colo.

Irby Bros. Machine & Iron Works
Aug. 22 (letter of notification) 75,000 shares of common
stock (par $1).
Price — $2 per share. Proceeds — For
field erection

equipment, to increase steel inventory and
working capital. Underwriter—Gates Carter & Co., Inc.,
Hatten Bldg., Gulfport, Miss.
J-A

Uranium, Inc., Salt Lake City, Utah
10,000,OGO shares of capi¬
tal stock (par one cent), Price—Three cents per share.
Proceeds—For expenses incident to mining activities.

Aug. 19 (letter of notification)

Hilo Electric Light Co., Ltd.,
Hilo, Hawaii
Aug. 1 filed 25,000 shares of common stock to be offered
for subscription by stockholders of record Sept. 5 on the

stock (par 10 cents).

share for each five

incident to mining activities.

Byington Building, Reno,
—Richard L. Dineley, same address.

Utah.

—

one new

3,000,000 shares of com¬
Price—10 cents per share.

Office—205

Hawk Lake Uranium Corp. j,
April 12 filed 200,000 shares of common stock (par 10
cents). Price—$1.50 per share. Proceeds
For mining
expenses, etc.
Underwriter—Dobbs & Co., New York
City, will act as agents.

basis of

cent).

Underwriters—None.

-

stock held; rights to expire on Oct.
3, 1955.
remaining 650,000 shares of common stock are to
placed privately. Price—$50 per unit; and $1 each

common

Underwriter—None.

multiples thereof.

operations.

Glenwood

'

improvement.

Home-Stake Production
Co., Tulsa, Okla.
May 12 filed 60,000 shares of capital stock (par $5) and
1,000 debentures (par $100) to be offered for sale in

ties
com¬

June 23

Food Fair

stock

Investments,

stock (par one cent). Price — 15 cents per share.
Proceeds—For expenses incident to mining. Office—701
Moline St., Aurora, Colo. Underwriter—Robert J. Con-

of principal amount

Proceeds—To provide
funds to comply with require¬
of surplus to policyholders under New York and

with

—

mon

(in denominations of $250 each).
company

paid-in

Gibralter Uranium Corp., Aurora, Colo.
July 18 (letter of notification) 2,000,000 shares of

Taylor,

^and to State Farm Bureau Federations and

local organization.

and

Utah.

Insurance Co., Albany, N. Y.
debentures to be offered
of the American Farm Bureau

members

capital

Office—130 Park Avenue, North, Winter Park,

Pioneer

Farm Family Mutual

Federation

increase

Price—$6

General Mining & Development Corp.
July 25 (letter of notification) 3,000,000 shares of com¬
mon stock.
Price—10 cents per share. Proceeds — For
expenses incident to mining activities.
Underwriter—

The

June 28 filed $1,500,000 of 5%

directly

l-for-2 basis.

Underwriters
Security Associates, Inc., Winter
Park, Fla., and Grimm & Co., New York City.

Fairway Uranium Corp., Salt Lake City, Utah
May 23 (letter of notification) 275,000 shares of capital
stock (par 50 cents).
Price—$1 per share. Proceeds—
For mining expenses.
Office—2320 South Main Street,
Salt

Proceeds—To

Fla.

each.

Washington Row, Sandusky, Ohio.
Underwriter
First Cleveland Corp., Cleveland, Ohio.

share.

per

stock

mon

and

made.

Sept .9 filed 42,080 shares of
market.

on Oct. 3.
Price—
construction of pipeline.

Proceeds—For

Underwriter—

mon

Fort Worth, Texas
Aug. 4 (letter of notification) 12,000 shares of common
stock (par $5) being offered for subscription by com¬
mon stockholders of record Aug.
19 on the basis of one
each

Corp.,

Empire Securities Corp., Las Vegas, Nev.

•

for

Securities

Proceeds—For oil and mining expenses.

(letter of notification)

share

Prudential

Mining & Oil, Inc., Kemmerer, Wyo.
(letter of notification) 1,000,000 shares of capi¬
tal stock (par five cents). Price — 25 cents per share.

Empire Southern Gas Co.,

r.ew

—

Aug. 1

r

and

address.

Underwriter

Gas Hills

Milwaukee, Wise.
1,000 shares of common
stock (no par). Price—$100 per share. Proceeds — For
purchase of machinery and working capital. Office—
3832 N. Third Street, Milwaukee, Wis.
Underwriter—
•

York.

same

Co., Midland, Mich.

None.

cent per share).
Pro¬
Office—515 Deseret Bldg.,
Underwriter — Moab Brokerage

Co., Western States Investment Co., Potter Investment
Co., Mid-America Securities, Inc. of Utah, and CashinEmery, Inc., all of Salt Lake City, Utah.

1c Downgard, Inc.,

Sept. 7

(one

par

to

★ Home Acceptance Corp., Salt Lake City, Utah
Sept. 1 (letter of notification) $300,000 of
25-year 6%
junior subordinated debentures due Oct. 1, 1980. Price—>
At par (in denominations of
$1,000, $500 and $100). Pro¬
ceeds—For working
capital.
Office—837 South Maine
St., Salt Lake City, Utah. Underwriter—Edward L. Bur¬
ton & Co., same city.

new

com¬

expenses.

Salt Lake City, Utah.

(par $5)
pursuant to the company's key employees'

option plan.

Price—At

ceeds—For mining

14 filed 225,000 shares of common stock

to be offered

share.

be first offered

shares for each full year of

units

(par $10).
Proceeds—For capital and surplus.

Office—2054

stock.

mon

Co.,

1t Dow Chemical

Calif.

Fremont Uranium Co., Salt Lake City, Utah
Aug. 1 (letter of notification) 15,000,000 shares of

Midland, Mich.
Aug. 5 filled 200,000 shares of common stock (par $5)
being offered to employees of company and certain ol
its subsidiaries and associated companies. Subscriptions
will be accented from Sept. 6 through Sept. 30. Price—
$47 per share.
Proceeds—For general corporate pur¬
poses.
Underwriter—None.
Sept.

Co., Berkeley,

life, title and
University Avenue, Berkeley,
Calif., c/o Ray B. Wiser, President. Underwriter—Any
underwriting agreement will be made on behalf of this
company by Uni-Insurance Service Corp.

Paul, Minn.
Sept. 6 (letter of notification) 22,000 shares of common
stock (par $5) of which 12,000 shares to be offered by
company and 10,000 on behalf of selling stockholders.
Price—$11.50 per share. Proceeds—For general corpor¬
ate purposes.
Office—666 Pelham Blvd., St. Paul, Minn.
Underwriters—Paine, Webber, Jackson & Curtis, Minne¬
apolis, Minn.; Kalman & Co., Inc., St. Paul, Minn, and
Piper, Jaffray & Hopwood, Minneapolis, Minn.
Chemical

per

mortgage.

• Donaldson Co., Inc., St.

Dow

Insurance

Business—All insurance coverages, except,

Co., Cheyenne, Wyo.

W. Allen ,&

.

June 6 filed 1,000,000 shares of common stock

incident to mining operations.
Office—352 Colorado National Bldg., Denver, Colo. Un¬
derwriters— R. L. Hughes & Co., Denver, Colo, and G.
For

—

space

<«

Freedom

stock (par one

mon

ceeds

system;

infra-red

Fowler Telephone Co., Pella, la.
May 6 (letter of notification) $260,000 of 4% first mort¬
gage bonds, series A, due May 1, 1975.
Price—At par
(in denominations of $1,000 each). Proceeds—To retire
existing debt, acquire Northwestern Bell properties in
Leighton, la., and for conversion of both exchanges to
dial operation.
Underwriter — Wachob-Bender Corp.,

Provo, Utah

(letter of notification) 6,000,000
assessable capital stock.
Price—At par

Dome Uranium Mines,

expansion

"Totosave"

Ray"

10

Weber

to

employees at rate of five
employment; then to general
public. Price — To stockholders and employees, at par
($20 per share); and to public, at prevailing market price
($25.87V2 per share on July 22, 1955). Proceeds — For

and for marketing of "Tropicheater. Office — Pittsburgh, Pa.
Underwriter—Barrett Herrick & Co., Inc., New York.

incident to mining activities. Office

Exchange Place, Salt Lake City, Utah.
Underwriter
—Western States Investment Co., same city.
—15

Dix Uranium Corp.,

shares

of

Salt Lake City, Utah

Dinosaur Uranium Corp.,

Aug.

Inc.

June 30 filed 300,000 shares of common stock

of which

Aug. 15 (letter of notification) 15,000,000 shares of com¬
mon stock.
Price—At par (one cent per share).
Pro¬
ceeds—For expenses

Packaging lntern?t:6nal,

(10/17)
(par luo,
250,000 shares of for account of company and
50,000 shares of five selling -stockholders. Price—$3 per
share.
Proceeds—For working capital; for exploitation

35

Continued, from page

Thursday, September 15,1955

...

shares; unsubscribed

Office—711-12

Continental Bank

Underwriter

—

Bldg., Salt Lake City,

Ackerson-Hackett Investment

Co.,

Salt Lake City, Utah.

1c Jessel-Roberts Productions Corp.
Sept. 3 (letter of notification) 150,000 shares of

common

Price—$2 per share. Proceeds—To
produce motion pictures for television and theatrical
exhibition.
Office — 30 Park Ave., New York, N. Y.

Volume 182

Number 5464

...

Inc., Cortez, Colo.
(letter of notification) 2,855,000 shares of non¬
assessable common stock (par one cent). Price—10 cents

Proceeds—For expenses incident to

share.

Cortez,

—

Underwriter

Colo.

to

mining

St.,

Office

activities.

326

Montezuma

West

Bay Securities Corp., New York,

—

<

Uranium

Kachina

Corp., Reno, Nev.

Denver, Colo.

New York; and Dean Witter & Co., San Fran¬

cisco, Calif.
Keeling Oil & Uranium Corp.
Price—30

expenses

cents

share.

per

incident to mining activities.

Securities Investment Co., Denver,

Proceeds—For
Underwriter

—

Colo.

20,

rate of one new

at the

1955,

share for each

eight shares held; rights to expire about Oct. 13. Price—
To be supplied by amendment. Proceeds—For working

capital

and

reduce

to

debt.

short-term

Office—Belle¬

ville, N. J. Underwriter—Carl M. Loeb, Rhoades & Co.,
New York, N. Y.
Kirby Oil & Gas Co.
July 8 filed 200,000 shares of common stock (par $1),
of which 100,000 shares are for the account of the com¬

and 100,000 shares for the account of the Murchi-

pany

son-Richardson financial

interests

Price—To

of Texas.

be

supplied by amendment. Proceeds—To retire out¬
standing bank loans and for exploration of oil and gas
Underwriters—Allen & Co., New York: and RauPierce & Co., Dallas, Texas.
Offering — Post¬

leases.

scher.

poned indefinitely.
•

Lamson

Magnolia Park, Inc.
Aug. 8 (letter of notification) maximum of
shares of common stock (par 10 cents) being

&

Sessions

Co.,

on

785,714
offered
subscription by stockholders of record Sept. 14

the basis of

one

new

share for each 3.24 shares held;

Sept. 24.
Price — To stock¬
holders, 35 cents per share; unsubscribed shares to pub¬
lic, 40 cents per share. Proceeds — For general corpo¬
rate purposes. Underwriters—Gearhart & Otis, Inc. and
Hunter Securities Corp., both of New York City; and
T. J. Feibleman & Co., New Orleans, La.

rights

subscribe

to

Cleveland,

(9/20)

O.,

Aug.

29 filed 62,500 shares of cumulative convertible
preferred stock, series A (par $50), of which 2,500 shares
are to be offered to holders of outstanding cumulative
preferred stock on a share-for-share exchange and 60,000

on

Ave., Mamaroneck, N. Y. Under¬
writer—A. C. Champlain & Co., New York, N. Y.

Proceeds

—

For

expenses

incident

to

mining activities.
Spokane, Wash.

Underwriter—Standard Securities Corp.,

by

ford

Co., Dallas, Texas
Aug. 19 (letter of notification) 70,000 shares of
stock

by

common

stockholders.

Price

—

share; and to public $4.25

To

stockholders,

$3.50

per

share. Proceeds—For ex¬
penses incident to oil and gas activities.
Office — 5738
North Central Expressway, Dallas 6, Tex. Underwriter—
Central Securities Co., Dallas, Tex.
per

Lander Valley Uranium & Oil Corp.
Aug. 15 (letter of notification) 3,000,000 shares of com¬
mon stock
(par two cents).
Price—10 cents per share.
Proceeds—For expenses incident to mining activities.

Office—c/o Warren E. Morgan, President, 1705 East First
South, Salt Lake City, Utah.
Underwriter—Empire Se¬
curities Corp., Las Vegas, Nev.
Leborn Oil & Uranium Co.
June 8
stock.

(letter of notification) 6,000,000 shares of capital
Price—At par

(five cents per share). Proceeds—
mining expenses. Office — 124*6 South Main St.,
Newcastle, Wyo. Underwriter — Mid-American Securi¬
ties, Inc. of Utah, Salt Lake City, Utah.
For

•

LeCuno Oil

Corp., Jefferson, Texas
Aug. 29 filed 450,000 shares of capital stock (par 10
cents). Price—To be supplied by amendment. Proceeds
—For payment of liabilities and expenses incident to oil
and gas and mineral activities. Underwriter—First Cali¬
fornia
Co., Inc., San Francisco, Calif.
Offering—Ex¬
pected in October.
Life

and

Accident

Insurance

Co.

of

June 2 filed 750,000 shares of class B (non-voting) com¬
mon stock (par $1).
Price—$3 per share. Proceeds—To
increase capital and surplus.

Inc., Philadelphia, Pa.
300,000 shares of com¬
mon stock (par one cent).
Price—$1 per share. Proceeds
—For working capital, etc. Office—825 Western Savings
Fund Bldg., Philadelphia, Pa.
Underwriter — Carl J.
Bliedung, Washington, D. C.
15

(letter of notification)

Merc-Uranium Corp.
July 20 (letter of notification) 6,000,000 shares of com¬
mon stock.
Price
Five cents per share. Proceeds—For
expenses incident to mining activities.
Underwriter —
—

Law Ihvestment

Co., Washington, D. C.

Merritt-Chapman & Scott Corp., New York
June

filed

28

basis of

on

shares

1% shares for each Devoe share;

53,324

Products & Chemical Corp.

to

common

stockholders of Ten¬
on a l*4-for-l basis;

13,453 shares to common stockholders of Newport Steel
Corp. on a l-for-2.1 basis; 10,899 shares to common
stockholders of Marion Power Shovel Co.

on

a

lV2-for-l

basis; and 548 shares of class B common stockholders of
The Osgood Co. on a l-for-lV2 basis. Offer will expire
on

Mesa-Loma

(par $5)

to

stock

of

Syntron Co. at rate of 5.4 shares of Link-Belt stock for
each Syntron

share. The exchange will become effective
of outstanding Syntron stock

if 95% of the 24,895 shares
are

deposited for exchange; but Link-Belt reserves the

right to declare the exchange effective if not less than
80%

of

Syntron

Statement

will

shares

not

be

are

so

effective

deposited
until

in exchange.

after

the

stock¬

holders' meeting Sept. 26.

Lyman-Farnsworth Corp.
May 6 (letter of notification as amended) 3,000,000 shares
of capital stock (par one cent). Price—10 cents per share.
Proceeds—For mining operations. Office—201 No. Main
St., Salt Lake City, Utah. Underwriter—Pioneer Invest¬
ments, Las Vegas, Nev.




($100

corporate purposes.

Underwriter—None.

^ National Commodity Futures, Inc., New York
Sept. 2 (letter of notification) 2,400 shares of common
stock.
Price—$20 per share.
Proceeds—To purchase
trade and deal in commodity futures.
Office—6 Harri¬
St., New York, N. Y.

Underwriter—None.

Office—415 Peterson

St., Fort Collins, Colo. Underwriter

Y.

Inc., New York
Sept. 12 filed 500,000 shares of 6% non-cumulative con¬
vertible preferred stock.
Price—At par ($2 per share).
Proceeds—For construction of plant; for research and
★ Metallurgical

development;

Resources,

and

M. S. Gerber, Inc.,

for working
New York.

Mitchell Mining Co.,

capital.

Underwriter—

Inc., Mount Vernon, Wash.

Uranium Corp.

incident to mining activities. Underwriter
Utah Uranium Brokers, Salt Lake City, Utah.

expenses

Uranium

&

Oil

Co., Salt Lake City,

Utah

of non¬
—

Five

share. Proceeds — For expenses incident to
activities. Office—605 Judge Bldg., Salt Lake

Underwriter—Skyline Securities, Inc., Den¬

Monogram Uranium & Oil Co.

Proceeds—For expenses incident to mining ac¬
Underwriter—Western Bond & Share Co., Tulsa,

Okla.

Navajo Cliffs Uranium Corp., Provo,

Corp. under a pur¬
chase contract; to use $100,000 each to purchase mining
equipment, to pay for development and driving drift and
for exploratory drilling; and the remainder for working
capital, acquisition of additional properties, and unfore¬
seen
contingencies. Underwriter—Carr & Co., Detroit,
$675,000 to Four Corners Uranium

Mich.

Ave., Provo, Utah. Underwriter
Salt Lake City, Utah.

June 6

Uranium Mines,

Inc.

(letter of notification) 10,750 shares of common
stock (no par) to be offered for subscription first by
stockholders; then to public. Price—$25 and $27.50 per
share, respectively. Proceeds — To purchase additional
properties. Office—569 Geary St., San Francisco, Calif.
Underwriter—None.

* New Mexico Copper

(letter of notification) 6,000,000 shares of com¬
Price—At par (five cents per share). Pro¬

mining expenses.

Corp., Carrizozo, N. M.

Sept. 8 (letter of notification) $100,000 of 6% convertible
debenture bonds due Oct. 1, 1965 (to be convertible at
any
mon

220 shares of com¬
— For mining ex¬
Underwriter—M. J. Sabbath Co., Washington,

time at rate of $100 of bonds for
stock). Price—At par. Proceeds

penses.

Mexico Oil & Gas Co.

July 27
mon

(letter of notification)

stock (par one

Proceeds

—

Bethesda, Md.

Office

—

2,500,000 shares of com¬

cent). Price—Three cents per

share.

general corporate purposes. Office —

For

Underwriter—Lewellen-Bybee Co., Wash¬

ington, D. C.
Oasis

Uranium & Oil Corp.,

Fort Worth, Texas

(letter of notification) 265,000 shares of common
stock (par 50 cents).
Price—$1 per share. Proceeds—
For uranium and oil exploration. Office—Fortune Arms

June 8

Bldg., Fort Worth, Tex.
Ohio Power Co.

Underwriter—Standard Securi¬

City, Utah.
(9/20)

Aug. 17 filled $17,000,000 of first mortgage bonds due
Sept. 1, 1985. Proceeds—To repay bank loans and for
new construction. Underwriter — To be determined by

competitive bidding. Probable bidders: Halsey, Stuart &
Co. Inc.; Harriman Riplley & Co. Inc. and Stone & Web¬
ster Securities Corp. (jointly); Kuhn, Loeb & Co.; Blytb

Securities Corp. and Salomon Bros.

Co., Inc.; Union

& Hutzler

(jointly); The First Boston Corp.

received up to 11 a.m.
Ohio Power Co.

Bids—To be

(EDT) on Sept. 20.

(9/20)

of cumulative preferred stock
Proceeds—For construction program. Under¬
by competitive bidding. Probablel bidders: Blyth & Co., Inc.; Lehman Brothers; Kuhn,
Loeb & Co.; Harriman Ripley & Co., Inc. and Stone &
Webster Securities Corp.
(jointly); The First Boston
Corp.; Union Securities Corp. and Salomon Bros & Hutz¬
ler (jointly). Bids—To be received up to 11 a.m. (EDTJ

Aug. 17 filed 60,000 shares

(par $100).

writer—To be determined

Sept. 20.
Orange Hotel,

Inc., Dallas, Texas

filed $450,000 of registered 4% sinking fund
debentures due May 1, 1985, which are to be offered
in exchange for $375,000 principal amount of registered
4% debentures and 3.750 shares of $20 par. stock of
Orange Community Hotel Co. in the ratio of $120 of new
debentures for each $100 of debentures and 20 shares of
stock of the Community company. Underwriter—None.
July

19

Inc., Las Vegas, Nev.

16 (letter of notification) 3,000 shares of capital
stock. Price—At par ($100 per share).
Proceeds—For
Aug.

stock.

ceeds—For

Lindquist Securities,

Realty Corp.

Officers

Naval

—

Sept. 2

Ottilia Villa,

Monte Carlo

Utah

July 6 (letter of notification) 6,000,000 shares of common
stock (par one cent). Price—Five cents per share. Pro¬
ceeds—For mining expenses. Office—156 No. University

on

Aug. 31 filed 1,000,000 shares of common stock (par $1).
Price—$2 per share. Proceeds — To make payment of

mon

tivities.

—

per

City, Utah.
ver, Colo.

share.

&

(letter of notification) 6,000,000 shares of com¬
stock. Price—Five cents per share. Proceeds— For

July 25

Mobile

^ Natural Power Corp. of America, Moab, Utah
Sept. 7 (letter of notification) 300,000 shares of non¬
assessable common stock (par one cent). Price—$1 per

ties, Inc., Salt Lake

May 13 (letter of notification) 500,000 shares of common
stock (par 10 cents). Price—50 cents per share. Proceeds
—For mining expenses. Address—P. O. Box 301, Mount
Vernon, Wash. Underwriter—Standard Securities Corp.,
Spokane, Wash.
Moab Treasure

improve capital stock structure of company. Office
South Main Ave., Sioux Falls, S. D. Underwriter—

New

—Bay Securities Corp., 115 Broadway, New York, N.

mining

Chicago, III.

12 filed 134,433 shares of common stock
be offered in exchange for the common

from

Mining Corp., Fort Collins, Colo.

(letter of notification) 2,955,000 shares of com¬
mon stock
(par one cent). Price — 10 cents per share.
Proceeds—For expenses incident to mining operations.
July 13

cents

Link-Belt Co.,

Price—At par

Proceeds — Toward repayment of advances
American Telephone & Telegraph Co. and for gen¬

share.

D. C.

Underwriter—None.

Sept. 30.

pany.
•

Sept. 27, 1955 on the basis of one new share for each five

None.

Medical Abstracts,

June

Aug. 22 (letter of notification) 5,500,000 shares
assessable capital stock (par one cent).
Price

Aug.

Telephone & Telegraph

held; rights to expire on Oct. 28.

515

Office—Gadsden, Ala. Un¬
derwriter
None, sales to be handled by Burlus Ran¬
dolph Winstead, Secretary and Treasurer of the com¬
—

States

(10/1)

To

Underwriter—Israel

Broadway, New York, N. Y.
Co., New York.

mon

Alabama

Co.

1639

&

basis;

(par 10 cents) to be first offered for subscription

Mountain

* National Reserve Life Insurance Co.
Sept. 2 (letter of notification) 27,789,408 shares of com¬
mon
stock. Price—At par ($10 per share). Proceeds—

nessee

Landa Oil

—Rambo, Close & Kerner Inc., Philadelphia, Pa.; and
J. S. Hope & Co., Scranton, Pa.

son

Co., Inc.

supplied

Mortgage Associates, Inc., Philadelphia, Pa.
7 (letter of notification) 20,000 shares of 60-cent
preferred stock (par $5) and 20,000 share3
of common stock (par 10 cents).
Price—For preferred,
$10 per share; and for common, $2.50 per share. Proceeds
—For construction loans and acquisitions. Underwriters
convertible

★ Medallion Pictures Corp. (9/22)
Sept. 3 (letter of notification) 300,000 shares of Class A
stock (par 10 cents). Price—$1 per share. Proceeds—For
working capital and other corporate purposes. Office—r

6,621 shares to class B common stockholders of Devoe
on
lV3-for-l basis; 127,623 shares to common stockhold¬
ers of New York Shipbuilding Corp. on a share-for-share

The exchange offer will

Price—To be

Office — 415 Paulsen
Underwriter—Pennaluna & Co.,

June

eral

Mines, Inc.
Aug. 1 (letter of notification) 300,000 shares of common
stock
(par 35 cents).
Price — 62*6 cents per share.

Proceeds—Together with other funds* for connew plants in
Brooklyn, Ohio, and in Bed¬
Park, 111. Underwriter—McDonald & Co., Cleve¬
land, Ohio.

30.

Proceeds—For mining expenses.

per

Center

511

—

struuction of

Sept.

Morning Sun Uranium, Inc., Spokane, Wash.
14 (letter of notification) 700,000 shares of com¬
mon stock
(par 10 cents). Price — 25 cents per share.

June

Office

ment.

on

/

Sept. 7 filed 486,881 shares of capital stock (par $100),
to be offered for subscription by stockholders of record

amend¬

expire

1

Monte Cristo Uranium Corp.

Aug. 19 filled 2,000,000 shares of common stock (par one
cent). Price—$1 per share. Proceeds—For purchase ot
certain claims designated "Lower Claims Group." Office
—Salt Lake City, Utah. Underwriter—None.

Maloney (M. E.) & Co., Inc.
Aug. 5 (letter of notification) 289,000 shares of common
(par 10 cents). Price—$1 per share. Proceeds—
For working capital.
Business — General contractors.

314,718 shares of common stock (par
$12.50) being offered in exchange as follows: 102,250
shares to class A stockholders of Devoe & Raynolds &

shares will be offered publicly.

tinent

Bldg., Spokane, Wash.
same city.

★

Mascot

• Kidde (Walter) & Co., Inc. (9/27)
Sept. 7 filed 53,700 shares of common stock (par $2.50),
to be offered for subscription by stockholders of record
Sept.

Beach,

stock

1,000,000 shares of com¬

(letter of notification)

stock.

& Co.,

Fla.

first for

•jc Kaiser Aluminum & Chemical Corp. (9/28)
Sept. 8 filed ,700,000 shares of cumulative preferred
stock (par $50). Price—To be supplied by amendment.
Proceeds—From sale of this stock, together with funds
from sale of $40,000,000 of 3%% first mortgage bonds
due 1976 to institutional investors, to be applied to cur¬
rent expansion program.
Underwriters—The First Bos¬

mon

Of the remaining 76,951 shares,

16.

offered to Joseph C. Mackey, Presi¬
dent, and 5,522 shares to employees. Price—$2.50 per
share. Proceeds
For purchase of equipment and for
were

general corporate purposes. Underwriters—Atwill
Miami Beach, Fla., and Emerson Cook Co., Palm

May 12 (letter of notification) 600,000 shares of common
stock (par 10 cents). Price—50 cents per share. Proceeds
—For mining expenses. Office—206 N. Virginia St., Reno,
Nev. Underwriter—Whitney, Cranmer & Schulder, Inc.,

July 29

Sept.

on

—

New York.

ton Corp.,

expire

71,429 shares

Salt Lake City, Utah. Underwriter—Mid-Con¬
Securities, Inc.. same city.

Bldg.,

cents), of which 256,383 shares are
subscription by common stockholders of record Aug. 18
at the rate of one share for each 3*6 shares held; rights

Jurassic Minerals,

37

(1101)

■*}„>

33^6
being offered for

Co., Inc., New York.

Aug. 26
per

•„

Mackey Airlines, Inc., Ft. Lauderdale, Fla.
July 29 filed 333,334 shares of common stock (par

Underwriter—Baruch Bro¬

George Jessel is President.
thers &

The Commercial and Financial Chronicle

706 Newhouse

Continued

on page

38

88

Continued

jrom

•

37

page

construction of additional units to
South 5th St., Las Vegas, Nev.

a

motel.

Office—4703

Underwriter—Hennon &

Roberts, Las Vegas, Nev.
International

Pacific

Metals

&

Inc.
Aug. 12 (letter of notification) 12,000,000 shares of com¬
mon
stock.
Price—At par (one cent per share). Pro¬
ceeds—For expenses incident to mining activities. Office
—419 Judge Bldg., Salt Lake City, Utah.
Underwriter—
Guss Securities Co., Salt Lake City, Utah.
Pacific Power &

Uranium,

(10/4)
of first mortgage bonds due
bank loans and for construc¬
tion program. Underwriter—To be determined by com¬
petitive bidding.
Probable bidders—Halsey, Stuart &
Co. Inc.; Union Securities Corp. and Kidder, Peabody &
Co., (jointly); Lehman Brothers, Bear, Stearns & Co. and
Salomon Bros. & Hutzler (jointly); Blyth & Co., Inc. and
White, Weld & Co. (jointly). Bids—Tentatively planned
Aug.

Light Co.

filed $10,0p0,000

30

Plastic Wire & Cable Corp., Jewett City, Conn.
Aug. 11 (letter of notification) 15,036 shares off common
stock (par $5), being offered to stockholders of record
Aug. 5 on the basis of one new share for each 10 shares

held; rights to expire on Sept. 21. Price—$9 per share.
Proceeds—For additional working capital and to finance
current

plant expansion. Office—East Main St., Jewett
City, Conn. Dealer-Manager—Putnam & Co., Hartford,
Conn.

to be received up to noon

(EDT)

on

Oct. 4.

it Pacific Power & Light Co. (10/5)
Sept. 8 filed 30,000 shares of cumulative preferred stock
(par $100) to be offered initially only in Oregon, Wash¬
ington, Wyoming, Montana and Idaho. Price—To be sup¬
plied by amendment. Proceeds — To repay bank loans
and for construction program.
Underwriters—Expected
to be local dealers.

Pacific Telephone & Telegraph Co.
July 29 filed 1,339,196 shares of common stock (par $100)
being offered for subscription by preferred and common
stockholders in the ratio of

one

new

share for each six

|

it Professional Uranium Corp., Seattle, Wash.
Sept. 1 (letter of notification) 2,750,000 shares of com¬
mon
stock (par two cents).
Price—10 cents per share.Proceeds

For mining expenses.
Office —^3536 Ekisf
St., Seattle 55, Wash. Underwriter—None.

147th

Proceeds—To repay

1985.

Commercial and Financial Chronicle

The

(1102)

—

Prospect Hill Coif & Country Club, Inc.
July 8 (letter of notification) 11,900 shares of preferred
stock.
Price—At par ($25 per share).
Proceeds—For
swimming pool, club furnishings and equipment, golf
course and organization and develoment
expense. Office
—Bowie, Md. Underwriter—L. L. Hubble & Co., Inc.,
Baltimore, Md.

1975.

Servo

Corp. of Americav(9/28) :
26 filed $600,000 shares of 6% convertible sub¬
ordinated debentures due 1975 (initially convertible into
common
stock at $6 per
share) and 110,000 shares of

class A and
—1500

Service

Electric & Gas Co.

—

Massachusetts

(9/22)

250,000 shares of cumulative preferred
stock (par $100). Price—To be supplied by amendment.

Ave.,

N.

W.,

Washington,

D.

C.

Underwriter—None.

Shumway Uranium, Inc., Moab, Utah
(letter of notification) 1,200,000 shares of

June 20

stock

mon

(par

one

cent).

Proceeds—For mining

Price—25

cents

Office

expenses.

—

per

6

com¬

share.

Kirby St.,

Underwriter—Skyline Securities Inc., Den¬

Colo.

ver,

Silvaire

Underwriter—

filed

be

one share of class B.
Price
$3 per unit.
Proceeds—For expenses incident to oil activities. Office

mon

7

are to

Shacron Oil Corp.,
Washington, D. C.
Aug. 15 (letter of notification) 150,000 shares of class A
common stock (par
$1) and,,75,000 shares of class B com¬
mon stock.(par
$1), to be sold in units of two shares of

June

Public

(par $1), of which 30,000 shares

Blackstone, President.
by amendment. Proceeds—For
plant expansion, working capital, etc.
UnderwriterIra Haupt & Co., New York.

bers:

Sept.

stock

common

offered for the account of
Henry
Price — To be supplied

To be determined

by competitive bidding. Probable bidHalsey, Stuart & Co. Inc.; Kuhn, Loeb & Co. and
Lehman Brothers (jointly);
Morgan Stanley & Co. and
Drexel & Co. (jointly); First
Bpston Corp. Bids—Ex¬
pected to be received up to 11 a.m. (EDT) on Oct. 4.

Thursday, September 15,1955

Aug.

Moab, Utah.

^Public Service Electric & Gas Co. (10/4)
Sept. 7 filed $35,000,000 of debenture bonds due
Proceeds—For repayment of bank loans.

•

...

17

Aircraft &

Uranium

Co.

(letter of notification) 3,000,000 shares of com¬
(par one cent). Price — 10 'cents per share).

stock

Proceeds—For
Colo.

mining

operations.

Office—Fort

Collins,

Underwriter—Carroll, Kirchner & Jaquith, Inc.,

Denver, Colo

-

it Southeastern Fund, Columbia, S. C.
Sept. 6 filed $300,000 of 15-year 5V2% subordinated sink¬
ing fund debentures. Price—100% of principal amount.
Proceeds—For general operating purposes. Underwriters
& Co., Fayetteville, N.
C., and Gordon Meeks

Aug. 31; rights to expire on Sept. 30.
American Telephone & Telegraph
Co., the parent, owns

ment

Proceeds—For general corporate purposes including pay¬
of bank loans and payment of portion of cost of

—Powell

90.89%

current

&

shares held

of

as

of

Pacific's

outstanding

stock

and

intends

to

subscribe for 1,199,849 of the new shares.
Price—At par.
Proceeds—To repay bank loans.
Underwriter—None.

Pacific

Radium

Uranium & Oil

Corp.
June 6 (letter of notification) 3,000,000 shares of com¬
mon stock
(par two cents). Price—10 cents per share.
Proceeds
For mining expenses. Office — 811 Boston
Bldg., Denver, Colo. Underwriter—Amos C. Sudler &
Co., same city.
—

,

it Pacific Western Oil Corp.
Sept. 9 filed

100,000 shares of

stock

common

v
Palestine Economic Corp., New York
July 1 filed 50,000 shares of common stock (par $25)
and $2,000,000 of five-year 5%
notes, series 1955. Price
--Of stock, $28 per
share; and of notes, at 100% of prin¬
cipal amount. Proceeds
For further development of
—

industry;

development

areas; extension of credit;
and working capital and

Underwriter—None, sales
pany officials and

Panama

of

urban

and

suburban

financing of exports to Israel;
general

corporate purposes.
be handled through com¬

to

employees.

Minerals, Inc., S. A.

July 19 (letter of notification) 625,000 shares of common
stock (par one cent).
Price—32 cents per share. Pro¬
ceeds

For expenses incident to mining operations.
Office—Bryant Bldg., Montrose, Colo.
Underwriters—
General Investing Corp., New York, N. Y., andiShaiman
& Co., Denver, Colo.

share.

Office—Denver. Colo.

—

it Rainbow Uranium Corp., Tonopah, Nev.
Aug. 30 (letter of notification) 6,000,000 shares of com¬
mon stock.
Price—At par (five cents per share).
Pro¬
ceeds—For mining expenses. Office—Main
St., Tonopah,
Nev.
•

Underwriter—None.

Rio

de

Oro

(par $1).

Proceeds—For mining expenses.

Underwriter—None.

Pandora Uranium
Mines, Inc.
July 14 (letter of notification) 3,000,000 shares of com¬
mon stock
(par one cent). Price — 10 cents per share.

Proceeds—For

expenses incident to mining operations.
Office—530 Main St., Groad
Junction, Colo. Underwriter
—Columbia Securities

Denver

2,

Colo,

and

Salt

Lake City, Utah.

* Parnell-Martin Supply Co., Charlotte, N. C.
Sept. 6 (letter of notification) $125,000 of 6%
ten-year
registered sinking fund debentures (with common stock
purchase warrants attached). Price—At par
(in denomi¬
nations of $1,000 each). Proceeds—For
reduction of bank
indebtedness. Office—925
Tuckaseegee Road, Charlotte,
N. C. Underwriter—R. S. Dickson &
Co., Charlotte, N. C.
Pelican Uranium
Corp., Salt Lake City, Utah
May 25 (letter of notification)
300,000 shares of common
stock (par five cents). Price—10
cents per share. Pro¬
ceeds—For mining expenses.
Office —688 East 21st
South, Salt Lake City, Utah.
Underwriter
TransWestern Brokerage
Co., New Orleans, La., and Salt
Lake City, Utah.
—

Uranium, Inc., Reno, Nev.
Aug. 4 (letter of notification) 2,000,000 shares of
com¬
stock (par three cents). Price—15
cents per share.

mon

Proceeds—For

expenses incident to
mining activities
Office—206 N. Virginia
Street, Reno, Nev. .Underwriter
—Philip Gordon & Co., Inc., New

York, N. Y.

Permian Basin Uranium
Corp.
June 2 (letter of
notification) 640,000 shares of common
stock. Price—At
par (10 cents per share).
Proceeds

mining^ costs.

querque,

N.

Mex.

Aug.

Underwriter

—

Western

Securities

Mining Co., Santa Fe, N. Mex.

25 filed 450,000

shares

of

common

stock

(par 10
Price—$1.75 per share. Proceeds—For
repayment
and liquidation of
purchase obligations; to buy
equipment;
and
for working
capital.
Underwriter—
Barrett Herrick & Co.,
Inc., New York.
loan

£

Sept. 6

Dri"ir|g & Oil Co.,

Independence, Kan.

(letter of notification)
60,000 shares of 6% nonpreferred stock (par
$5) and 60,000 shares
of common stock
(par 10 cents) to be offered in units of
one
share of each. Price—$5
per unit.
Proceeds—For
cumulative

payment of note and
working capital.
National Bank Bldg.,

Office—420 Citi¬

zens

Independence, Kan.
writer—Dewitt Investment
Co., Wilmington, Del.




(par $1).
capital.

For working

Co., Fayetteville, N. C., and
Co., Memphis, Tenn.

it Southwestern Financial Corp., Dallas, Texas
6 filed 770,000 shares of common stock (par 10
cents), to be offered for subscription by stockholders at
Sept.

rate of

two

new

shares

for each

supplied by amendment.

share held.

Price—To

Proceeds—For purchase of

machinery and equipment; and for working capital and
general

corporate

purposes.
Underwriter — Rauscher,
Co., Dallas, Tex.; and Russ & Co., San Antonio,

Pierce &
Tex.

Southwestern Investment Co., Amarillo, Texas
Aug. 22 filed $2,500,000 of 5% sinking fund capital de¬
bentures, series A, dated Sept. 1, 1955. Holders of $1,000,-

for

Underwriter—Tellier & Co., Jersey City,
If 85% of issue is not sold,

000

outstanding 5% and 5 xk % capital debentures will
opportunity to exchange their debentures
the
new
debentures.
Price
—i00% of principal

N. J., on a best-efforts basis.

amount.

Proceeds—To retire debt and increase

monies will be refunded.

capital.

Underwriter—The First Trust Co. of

be

offered

of record

for

Oct. 6

subscription

on

^by

the basis of

common
new

one

stockholders

share for each

held; rights to expire on Oct. 24. Price—To
supplied by amendment. Proceeds — To repay bank

be

Boston

construction.

new

Underwriter—The First

Spirit Mountain Uranium, Inc., Cody, Wyo.
July 29 (letter of notification) 25,200,000 shares of com¬
mon stock. Price—At par (one cent per share). Proceeds
—For

incident to mining activities. Office—
Cody, Wyo. Underwriter—Utah Uranium
Brokers, Las Vegas, Nev.

July 15

expenses

1507-8th Street,

Corp., New York.

Rocket

working
Lincoln,

Neb.

(par $10)

four shares

Splendora Film Corp.,

Mining Corp., Salt Lake City, Utah

(letter of notification) 6,000,000 shares of cap¬
(par one cent).5 Price—Five cents per share.

New York

July 27 filed 1,200,000 shares of common stock (par 10
cents). Price—50 cents per share. Proceeds—For equip¬

ital stock

ment

Proceeds—For

and

for

Co.,

Inc., and McGrath Securities Corp., both of New

mining operations.
Office—530 Judge
Bldg., Salt Lake City, Utah. Underwriter—Mid Ameri¬
ca
Securities, Inc., of Utah, 26 W. Broadway, Salt Lake
City, Utah.
V.
.

.

Royal Uranium Corp.
May 26 (letter of notification) 200,000 shares of

common

stock

(par five cents). Price—At market (total not to
$150,000). Proceeds—For working capital. Office
—Walker Bank Bldg., Salt Lake City, Utah. Underwriter
—Whitney & Co., same city. No general offer planned.
exceed

Saint Anne's Oil Production Co.

May 9 (letter of notification) 20,000 shares of

common

stock

(par $1) to be first offered to stockholders. Price
—$6.25 per share. Proceeds — For oil and mineral and
related activities.

Office—Northwood, Iowa. Underwriter

—None.
•

Boston, Mass.

Sept. 2 filed 125,714 shares of
to

be

offered for

the

on

basis

of

common

subscription by
one

new

stock

share

for

(par $12.50)
stockholders

each

3%

shares

held as of Sept. 21; rights to
expire about Oct. 5.
Price—To be supplied by amendment. Proceeds — To¬
gether with funds from insurance company and a

bank,

to

be

used

brook &

for expansion

Underwriter—Esta-

program.

Co., Boston and New York.

for

accessories;

working capital.

financing film productions;
Underwriters—J. H. Lederer
.

it Sunburst Uranium Corp., Salt Lake City, Utah »
Sept. 6 (letter of notification) 2,750,000 shares of non*assessable
common
stock
(par two cents).' Price—10
cents per share.
Proceeds — For expenses incident tp
mining activities. Office—116 Atlas Building, Salt Lake
City, Utah. Underwriter—Mid America Securities, Inc.
of

Utah,

same

City.

Sulphur, Inc., Houston, Texas
*
Aug. 24 filed 400,000 shares of common stock (par one
cent). Price — $1 per share. Proceeds — To purchase
lease; to drill three exploratory wells; for exploration
in the Isthmus of Tehuantepec, Vera Cruz, Mexico; and
general

Lederer

(9/21)

common

and

York.

for

St. Croix Paper Co.,

corporate

purposes.

Underwriter

—

J.

H.

Co., New York.

Sun

Hotel, Inc., Las Vegas, Nev.
filed
(as amended) 3,750,000 shares of com¬
(par one cent). Price—$2.50 per share. Pro¬
ceeds—To construct hotel and for working capital. Un¬
derwriters—Golden-Dersch & Co., Inc., New York: and
Coombs & Co. of Las Vegas, Inc., Las Vegas, Nev. Offer¬
Feb.

mon

16

stock

ing—Postponed.

Aug. 15 (letter of notification) 1,503,000 shares of com¬
mon
stock (par one
cent).
Price—20 cents per share.

it Superior Uranium Corp., Provo, Utah
Sept. 2 (letter of notification) 10,000,000 shares of non¬
assessable common stock. Price—At par (two cents per
share). Proceeds—For expenses incident to mining ac¬
tivities.

St.

Regis Uranium Corp., Denver, Colo.

—

For\

expenses

Office—2285 South

cents).
of

(10/13)

—

&

Proceeds

Office—613 Simms Building, Albu¬

Corp., Salt Lake City, Utah.
Petaca

Inc.

Proceeds

Powell

Gordon Meeks &

Junction, Colo.

Penn-Utah

For

Mines,

share.
—

be offered the

loans and for

Co.,

Uranium

per

Underwriters

Aug. 15 filed 3,000,000 shares of common stock (par one
cent).
Price—15 cents per share.
Proceeds—For ex¬
penses incident
to mining operations.
Office—Grand

to

June 30 filed 400,000 shares of common stock
per

Price—$5

Inc., Montrose, Colo.

it Rochester Telephone
Corp^(lC/7)
Sept. 14 filed 195,312 shares oLcommon stock

(Republic of

Panama)

Price—$1.25

Hill Uranium,

Co., Memphis, Tenn.

★ Southeastern Fund, Columbia, S. C.
Sept. 6 filed 60,000 shares of common stock

be

(par $4.)
Price—At prevailing market price. Proceeds—To J. Paul
Getty, President. Underwriter—None.

Israel

construction.
Underwriters—Morgan Stanley &
Co., Glore, Forgan & Co., both of New York; and Drexel
& Co., Philadelphia, Pa.

Under¬

—M. J. Reiter

incident

to

mining activities.
Underwriter

Jackson/Denver, Colo.

Co., New York, N. Y.

Aug.

19

assessable
per

activities.

Susan

non¬

stock (par one cent). Price—12 cents
Proceeds—For expenses incident to mining

common

share.

Office

—

718

Kittredge Bldg., Denver, Colo.

Underwriter—Shelley-Roberts & Co., Denver, Colo.
Santa

Fe Uranium &

Oil

Co., Inc.
May 26 (letter of notification) 2,959,500 shares of com¬
mon stock
(par one cent). Price
10 cents per share.
Proceeds—For mining operations. Office—416
Indepen¬
dence Bldg., Colorado
Springs, Colo. Underwriter—Co¬
—

lumbia Securities Co.,
Denver, Colo.

—

180

Utah.

San Juan Uranium

Exploration, Inc.
(letter of notification) 925,000 shares of

Office

Underwriter—Bel-Air

Easjt

Center

Securities

St.,

Provo,

Utah.

Corp., Salt Lake City,
..

B.

Uranium

Corp., Carson City, Nev.
Aug. 11 (letter of notification) 300,000 shares of non¬
assessable common stock.
Price—At par ($1 per share).
Proceeds—For mining expenses.
Office—Virginia Truck
Bldg., Carson City, Nev.
Underwriter—Coombs & Co.
of Las Vegas, Nev.
.

Swank

Uranium

Drilling & Exploration Co.
Aug. 17 (letter of notification) 3,000,000 shares of com¬
mon stock.
Price—At par (10 cents per share). Proceeds
—For expenses incident to mining activities. Office—
Moab, Utah.
Underwriter—Honnold & Co., Inc., Salt
Lake City, Utah.

rm

Volume 182

Number 5464

'■fwv

M

ta*

The Commercial and Financial Chronicle

...

(1103)
Tampa Electric Co. (9/21)
Aug. 31 filed 197,532 shares of

common stock (par $7)
subscription by common stockholders of
record Sept. 19, 1955 on the basis of one new share for
each 10 shares held (with an
oversubscription privilege);
rights to subscribe on Oct. 6, 1955. Warrants are to be

to be offered for

mailed

on

ment.

Sept. 21.

Proceeds

—

Price
To

To be supplied by amend¬
$5,083,000 of bank loans.

—

repay

Dealer-Manager—Goldman, Sachs & Co., New York.
Target Uranium Co., Spokane, Wash.
Aug. 12 (letter of notification) 1,000,000 shares of non¬
assessable stock (par five cents). 1 Price—20 cents
per
share.
Proceeds —For mining expenses.
Office
726
Paulsen Bldg., Spokane, Wash.
Underwriter
Percy
Dale Lanphere, Empire State
Bldg., Spokane, Wash.
—

—

Tasha Oil & Uranium

Co., Denver, Colo.(letter of notification) 6,000,000 shares of com¬
(par one cent)**-Price—Five cents per share.

May 11

stock

mon

Proceeds—For mining operations.

St., Denver, Colo. Underwriter
Jaquith, Inc., same city.

Office—1890 S. Pearl

Carroll, Kirchner &

—

Place, Salt Lake City, Utah. Underwriter
States Investment Co., Tulsa, Okla.
Ucon
June 2

Western

—For

Corp., Salt Lake City, Utah
(letter of notification) 5,000,000 shares of
(par

Price—Five cents

cent).

one

com¬

share.

per

mining costs. Office—406 Judge Build¬
ing, Salt Lake City, Utah. Underwriter—Empire Secu¬
rities Corp., Las Vegas, Nev.

Underwriter—Moab Bro¬
kerage Co. and National Securities, Inc., 368 South State
St., Salt Lake City, Utah.

U-Kan Uranium & Oil Co., Salt Lake City, Utah
May 5 (letter of notification) 260,000 shares of common
(par 10 cents). Price—$1 per share. Proceeds—
For mining expenses. Office — Judge
Bldg., Salt Lake
City, Utah. Underwriter — Northern Securities, Inc.,
Seattle, Wash.
,

★ Washington REAP, Inc., Dover, Del.
30 (letter of notification) 400 shares of common
Price
$500 per share. Proceeds
To purchase
outstanding stock of Elmark Corp., which owns garden
apartment development. Office—129 S. State
St., Dover,

Aug.

stock.

stock

Union of Texas Oil Co., Houston, Texas
July 12 (letter of notification). 61,393 shares
stock

mon

other

of

Underwriter—Real Estate Associates
Plan, Inc., 14
Square, Jersey City, N. J.
Western Financial Corp.

com¬

Aug. 24 (letter of notification) 50,000 shares of

Underwriter—Mickle

&

stock

Co.,

sell

American Life Insurance Co. and Tourists Indemnity Co.;
balance to be used to engage in mortgage loan business

Texas Adams Oil Co.,
Inc., New York, N. Y.
Aug. 11 (letter of notification) 66,600 shares of common
stock (par 10 cents).
Price—75 cents per share.
Pro¬

United States Thorium Corp.
July 21 (letter of notification) 250,000 shares of capital
stock. Price—At par ($1 per share). Proceeds—For gen¬

ceeds—To

eral corporate purposes.

selling

stockholders.

Office—39

New

York, N. Y.
Underwriter—Philip
Inc., New York, N. Y.

Gordon & Co.,

sell

27,500 shares of class A

stock to be offered for

their

Brothers

common

pursuant

to

stock
an

simultaneously herewith.
Office

—

Cotton

subscription by

of

that

company

Miller

to

offer

to pruchase being made
Price—At par ($10 per share).

Exchange Bldg., Dallas, Tex.

Under¬

Texas

Toy Co., Houston, Texas
July 8 (letter of notification) 300,000 shares of common
stock (par 25 cents).
Price—$1 per share. Proceeds—
For payment of accounts payable of
operating company;
expansion and working capital. Office—2514
McKinney
Ave., Houston, Texas. Underwriter—Ray Johnson & Co.,
Inc., Houston.
Texas Western Oil & Uranium
June 15 (letter of notification)

Co., Denver, Colo.

5,960,000 shares of

com¬

stock

(par one cent). Price—Five cents per share.
Proceeds—For mining expenses. Office — 407 Denver'
National Bldg., Denver, Colo.
Underwriter—Floyd Koster & Co., same address.

Bldg., Albu¬

Underwriter—Hicks, Newton & Co., Inc.,

Denver, Colo.

,

★ Town Enterprises, Inc., Wilmington, Dei.
ept. 2 (letter of notification) 200,000 shares of class A
stock

ommon

(par 50 cents).

roceeds—To make loans.

ington 1, Del.
filed

1

Price

—

Office—902

$1.50 per share,
Orange St., Wil-

Underwriter—None.

Trans-National

uly

Uranium & Oil

2,000,000 shares of

Corp.

stock (par 20
ents). Price—To be supplied by amendment (expected
t $1.50 per share). Proceeds—To
acquire part of proprties presently subject to option in favor of
company,
and for expenses incident to
mining and oil activies.,
ffice

Dallas, Tex.
Dallas, Tex.

nc.,

—

common

Underwriter

—

Garrett Brothers,

Triangle Mines, Inc., Salt Lake City, Utah
ray 3 (letter of notification) 100,000 shares of
tock.

Price—At

par

(50 cents

mining operations. Office
ake City, Utah.
Underwriter
ashington, D. C.

.or

per

share).

common

Proceeds—

506 Judge

BldgM Salt
Lewellen-Bybee Co.,

—

—

"

ase

(letter of notification) 78,000 shares of common
Price—At par ($1 per share). Proceeds—For
pur-

of

apital.

equipment, development of leases and working
Office—W. T. Waggoner Bldg., Fort Worth, Tex.

nderwiiter—None.

Tri-State Natural Gas Co.,
Tucson, Ariz.
uly 6 (letter of notification) 200,000 shares of common
ock (par 10 cents). Price—$1.50 per share. Proceeds—
or expenses incident to oil and
gas activities. Office—
5

Washington
Edenfield

St.,

& Co.,

Tucson, Ariz.
Miami, Fla.

Underwriter—Frank

Tunacraft, Inc., Kansas City, Mo.
22 (letter of notification) $295,000 principal amount
6% 12-year registered subordinated sinking fund deentures, dated Sept. 1, 1955 (with stock purchase warants). Price—At par (in denominations of $100 each
ug.

multiples thereof). Proceeds—To refinance and aisharge secured obligation. Underwriter
McDonald,
'vans & Co., Kansas City, Mo.
—

Tungsten Mountain Mining Co., Fallon, Nev.
8 (letter of notification) 149,800 shares of common

une

tock

(par $1). Price—$1.50
ining operations. Address

hurchill County, Nev.

per
—

share.

P.

O.

Proceeds—For

Box

456,

Fallon,

Underwriter—H. P. Pratt & Co.,

eattle, Wash.

stock

(par three cents). Price—10 cents

oceeds—For

(par
For

—

ceeds—For

stock

share

of

(par

10

class

A

cents)
and

4

to

be

shares

offered
of

class

Uranium

in

amounts

in
B

Proceeds

(no

par).
Price—One cent per share.
mining activities. Office — 1101 South
St., Salt Lake City, Utah.
Underwriter—Anderson-Hackett Investment Co., same city.

new

mon

300,000 shares of com¬
($1 per share). Proceeds—To
rebulid and market television pic¬

Price—At par

manufacture, process,
tures tubes, etc.
Underwriter
Worth, Texas.
Vanura

mon

First

—

Zone Investments Co.,

Uranium, Inc., Salt Lake City, Utah

16 (letter of notification)
stock

Proceeds

(par

—

For

one

cent).

mining

3,000,000 shares of

Price

expenses.

—

com¬

10 cents per share.

Underwriter

&

Boston

received
Boston
•

mining

expenses.




Office—32

per

eom-

Exchange

Corp.
Oct.

18

Aug.

Bids—Tentatively scheduled to be
company's office, 441 Stuart St.,

at

16, Mass.

Yale & Towne

19 filled

Manufacturing Co.

shares of capital stock (par $25)
being offered for subscription by stockholders of record

Sept. 9

on

106,931

the basis of

held; rights to expire

share for each six shares

one new

on

Sept. 26.

Price—$56

per

share.

Proceeds—To repay $1,000,000 bank loans and for work¬

ing capital and general corporate purposes.
—Morgan Stanley & Co., New York.
Yellow

Circle

Uranium

Underwriter

Co.

July 22 (letter of notification) 5,000,000 shares of com¬
mon stock.
Price—At par (five cents per share). Pro¬
ceeds— For mining expenses.
Office — 223 Petroleum
Building, Salt Lake City, Utah. Underwriter—Morgan
& Co., same city.
•

Yellowknife

Uranium

Corp.

(10/3-7)

—

I. J.

cent), of which 700,000 shares are to be sold for account
company and 300,000 shares for account of Stancan
Corp.
Price—$1.50 per share.
Proceeds—For

of

Uranium

payments under purchase and option agreements for
claims; for working capital and reserve funds; and for
other
general corporate purposes.
Office — Toronto,
Canada. Underwriters—Gearhart & Otis, Inc. and F. H.
Crerie

& Co., Inc.,

both of New York City.

York Oil & Uranium Co.
June 3

(letter of notification) 10,000,000 shares of capi¬
Price—At par (two cents per share). Proceeds
mining and oil activities.
Address—P. O. Box

tal stock.

was

share,

on

Aug. 19 filed 1,000,000 shares of common stock (par one

Fort

June

& Hutzler and Stroud & Co., Inc. (jointly);
Burr, Inc.; Kidder, Peabody & Co., Blyth &
Co., Inc. and White, Weld & Co. (jointly); Blair & Co.
Incorporated and Baxter, Williams & Co. (jointly); The
Coffin

-

Corp.
(letter of notification)

13

Bros.

omon

(letter of notification) 3,000,000 shares of capital
par (10 cents per share).
Proceeds—
expenses.
Office—210 N. Third St., Las
Underwriter—Lester L. LaFortune, same

stock.

Underwriter—To be determined by
bidding. Probable bidders: Halsey, Stuart
Inc.; Merrill Lynch, Pierce, Fenner & Beane, Sal¬

& Co.

Price—At

Vactron

May

construction.

competitive

Vegas, Nev.

Brokerage, Salt Lake City, Utah.

Nat'l

★r Worcester County Electric Co. (10/18)
Sept. 13 filed $8,500,000 of first mortgage bonds, series D,
due
1985.
Proceeds—For payment of bank loans and

Inc., Reno, Nev.
Aug. 15 (letter of notification) 270,000 shares of capital
stock.
Price—At par ($1 per share).
Proceeds—For ex¬
penses incident to mining activities.
Office—312 Byington Bldg., Reno, Nev.
Underwriter—Lester L. LaFortune, Las Vegas, Nev.

Uranium

expenses

of
corporate structure,
etc.
Underwriter —
Straus, Blosser & McDowell, Chicago, 111. Offering—To

Utah Grank,

Proceeds—Expenses incident to mining operations. Of¬
fice—Lytle Building, Vale, Ore. Underwriter—Hansen

For

Denver

be withdrawn.

—Greyhound Terminal Building, West Temple & South
Temple Streets, Salt Lake City, Utah. Underwriter—
Trans-Western Brokerage Co., New Orleans, La.

Diata, Inc., Vale, Ore.
July 8 (letter of notification) 10,000,000 shares of com¬
mon stock
(par one cent). Price—Two cents per share.

non¬

revision

Inc., Salt Lake City, Utah
Aug. 1 (letter of notification) 600,000 shares of common
stock (par 16% cents).
Price—50 cents per share. Pro¬
ceeds—For expenses incident to mining activities. Office

Utore Uranium &

of

per

•

Utah-Arizona Uranium,

tions, Inc. Office—45 East Acre Drive Plantation, Fort
Lauderdale, Fla. Underwriter—None.

($1

Woods Oil & Gas Co., New Orleans, La.
Aug. 29 filed 250,000 shares of common stock (par $5).
Price—$8 per share. Proceeds—For retirement of debt;

For

it Utilities Operating Co., Inc.
Sept. 6 (letter of notification) 30,000 shares of common
stock.
Price—At par ($10 per share).
Proceeds—For
purchase of equipment and advances to Broward Planta¬

—

Office—414

State

mining
Vegas, Nev.
city.

Price—At par

incident to mining activities.
Bldg., Denver, Colo.
Under¬
writer—Floyd Koster & Co., Denver, Colo. •

Uranium Technicians Corp., Salt Lake City, Utah
30
(letter of notification) 30,000,000 shares of

Utah Southern Uranium Co., Las

W,

Wonder Mountain
Uranium, Inc., Denver, Colo.
Aug. 12 (letter of notification) 2,380,000 shares of com¬
mon
stock (par one cent).
Price—10 cents per share.

June

June 6

Sixth

Underwriter—J.

share).
Proceeds—For expenses incident to mining activities.
Office—800 Denver Club Building,
Denver, Colo. Under¬
writer—Seligmann & Co., Milwaukee, Wis.

invested in U. S. Savings bonds and the balance
equipment and exploration and development ex¬
penses.
Underwriter—None.
Offering—Postponed.

stock

Office—1030 South

Price — $16.50 to stockholders; and $17.50 to
Proceeds—To repay bank loans and for exten¬

assessable common stock.

for

—

expenses.

it Wolfson Uranium Corp., Denver, Colo.
Sept. 7 (letter of notification) 150,000 shares

Ltd., Virginia City, Nev.
$600,000 of Grubstake Loans t$*be offered
$25 or multiple thereof. Proceeds—75%

Proceeds

mining

sions and improvements to property. Office—235 Broad
St., Lake Geneva, Wis. Underwriters—The Milwaukee
Co., Milwaukee, Wis.;; and Harley, Haydon & Co., Inc.
and Bell & Farrell, Inc., both of
Madison, Wis.

of

common

—

Sept. 29.

Properties,

13 filed

East

holders of record about Sept. 15 on the basis of one new
share for each five shares held; rights to
expire on

Price—$1 per unit. Proceeds—For expenses in¬
cident to mining activities.
Office — Powers Bldg.,
Rochester, N. Y. Underwriter—None.
•

105 %

Aug. 31 (letter of notification) 16,654 shares of common
stock (par $10), to be offered for
subscription by stock¬

stock.

June

—

stock.

it Uran Mining Corp., Rochester, N. Y.
Sept. 6 (letter of notification) 60,000 shares of class A
voting common stock and 240,000 shares of class B non¬
one

Office

Wicker-Baldwin Uranium Mining Co.
May 26 (letter of notification) 900,000 shares of common
Price—At par (25 cents per share). Proceeds—
For mining expenses. Office—616 Sixth
St., Rapid City,
S. D.
Underwriter—Driscoll-Hanson, Inc., same city,
★r Wisconsin Southern Gas Co., Inc.

5,998,000 shares of com¬
Price—Five cents per share.

mining operations. Office — 7900 West
Underwriter — Columbia

common

com¬

Price—Five cents per share.

West St., Salt Lake
City, Utah.
Hicks & Co., Inc.,
Denver, Colo.

public.

of

cent).

mining activities.

Uranium, Inc., Salt Lake City, Utah
(letter of notification) 2,900,000 shares of capital
(par 2% cents). Price—10 cents per share. Pro¬

stock

Postponed.

units

one

For

White Horse

Universal Service Corp., Inc., Houston, Texas
July 8 filed 500,000 shares of common stock (par two
mills). Price—$2.50 per share.
Proceeds—For equip¬
ment, mining costs, oil and gas development, and other
corporate purposes.
Underwriter — None.
Offering —

voting

(par

—

June 9

Underwriter—Doxey-Merkley &

cent).

—

Peak, Colorado Springs, Colo.
Underwriter
Hicks, Newton & Co., Inc., Denver, Colo.

Uranium Corp.

one

common

—
$1 per share. Proceeds
Business — Purchases and

Pikes

Schenin &

Two Jay Uranium Co., Salt Lake City, Utah
ay 16 (letter of notification) 3,000,000 shares of
on

Proceeds

Colfax Avenue, Denver, Colo.
Securities Co., Denver, Colo.

For

31

tock.

stock

mon

Price

Mining, Inc.
(letter of notification) 6,000,000 shares of

stock

mon

Underwriter—None.

&

cent).

Wet Mountain

Co., Salt Lake City, Utah.

stock.

★ Trinity Oil Corp., Fort Worth, Texas
ug.

fields.

one

commodities.

June 29

to be

Thunderbird Uranium Corp.
rune 9 (letter of notification) 3,000,000 shares of common
stock.
Price—At par (10 cents per share).
Proceeds—
For mining expenses.
Office—915 Simms
querque, N. M.

related

Proceeds
common

writer—None.

mon

and

Universal Oil

stockholders of Miller Brothers of
Texas, Inc., who elect
to

.

July 26 (letter of notification)

it Texas Textile Mills, Inc.
(letter of notification)

Sept. 2

common

Broadway,

working capital, etc.

Office
430 Park Ave., New York.
Underwriter—J. H. Lederer Co. Inc., New York.

United American Investment Co., Atlanta, Ga.
July 19 filed 3,500,000 shares of common stock no par.
Price—$2 per share. Proceeds—For organization of two
wholly-owned insurance compaies, to be named United

working capital for agency expansion. Office
1409
Magnolia Ave., Knoxville, Tenn. Underwriter—Jesse C.
Bowling, 16 M Street, Bedford, Ind.

(par

—For

Houston, Texas.

Tennessee Life & Service Insurance Co.
June 20 (letter of notification)
9,200 shares of common
stock (par $5) to be offered for
subscription by stock¬
holders.
Price—$30 per share. Proceeds—To increase
—

—

Journal

Price—$1.25 per share. Proceeds—
bank loans, and for development costs and

corporate purposes.

—

Del.

(no par).

reduce

Underwriter—Skyline Secu¬

Wabash Uranium Corp.,
Moab, Utah
June 10 (letter of
notification) 10,000,000 shares of capi¬
tal stock. Price—At
par (three cents per share).
Pro¬
ceeds—For mining expenses.

Proceeds—For

To

mining operations.
Inc., Denver, Colo.

rities

Uranium

stock

mon

—

39

—For

Co., New York. Name Change—The company
formerly known as San Miguel Uranium, Inc.

Vas

Uranium

&

Drilling Co.,

June 20 (letter of notification)
mon

stock.

Monticello,

Utah

2,000,000 shares of

Price—At par (10 cents per

com¬

share). Proceeds

Newcastle, Wyo. Underwriter—Empire
Corp., Salt Lake City, Utah.
348,

Continued

on

Securities
page

40

40

The Commercial and Financial Chronicle

(1104)

Continued

from

page

the

current year.
Proceeds—For construction program.
Underwriter—To be determined by competitive bidding.
Probable bidders: Halsey, Stuart & Co. inc.; morgan

Sept.

&

basis.

to

under

consolidate

and

—

Bank of

•

Sept.

ap¬

10

Oct.

from

increasing tne

on

900,000 to <l,5uU,Oo0
stock from lli,buo

long term dent to
Proceeds—From stock sale, to help finance

214,605 snares; and the authorized

modernization
Riter &

and

expansion

Underwriter—

program.

Power &

Light Co.
July 26, Stuart Cooper, President, announced that the
company is planning the issuance of bonds and equity
securities.
nent

It

appears

financing

that the first step

ot the program

late this fall.

Proceeds

—

in

the perma¬

will take place sometime
bank loans and tor

To repay

construction

program,
which includes two plants
which will cost approximately $40,IKJU,000. Underwriters
—To be determined by competitive bidding.
Probable

bidders: (1) For bonds—Halsey, Stuart & Co. Inc.; Kuhn,
Loeb & Co. and Salomon Bros. & Hutzler
(jointly);
Lehman
Boston

& Sons.

Weid &

Pierce,

California, N. A.

Brothers; Union Securities Corp.; The First
Corp; and Blyth & Co., Inc. (jointly); White,
Co. and Shields & Co. (jointly); Merrill Lynch,
Fenner & Beane and Kidder, Peabody & Co.

Witter

registration is ex¬

Peabody

Boston & Maine RR.

&

or

nancing

Electric Co.

reported company plans to issue and sell
mortgage bonds. Underwriter—To

was

Florida

Power
was

Corp.
announced

issue and sell

$19,000,000 and $12,000,000 of first mortgage
Underwriters—To be determined by competitive
bidding. Probable bidders: Halsey, Stuart & Co. Inc.;
Kidder, Peabody & Co. and Merrill Lynch, Pierce, Fen¬
ner &
Beane (jointly); Lehman Brothers and Blyth &
Co., Inc. (jointly): Glore. Forgan & Co.; and The First
Boston Corp. Offering—Expected late in 1955 or early

Edison Co.

Consolidated Edison Co. of New
York,
June
14
it was announced
company

$40,000,000 to $50,000,000 bonds

Ford

to

sell

new

-

it

was

Co., Detroit, Mich.
reported that following a probable 10offering of approximately 4,000,000

stock split, an

for-1

time during

Motor

15

shares will be made to the public.

be

around

Foundation.

of 1955, if

$60

per

share.

Proceeds

Price—Expected
To the Ford

—

Offering—Probably not until

"latter

part

then."

Gulf States Utilities Co.

May 16 it
$10,000,000

pet*

was

reported company

issue and

may

sell

first mortgage bonds if market conditions
Underwriter—To be determined by competitive

permit.

bidding.

Probable

bidders:

Halsey, Stuart & Co. Inc.;
Brothers; Merrill Lynch, Pierce, Fenner &
Beane and White, Weld & Co. (jointly); Salomon Bros,
& Hutzler and Union Securities Corp. (jointly); Kuhn.
Loeb & Co. and A. C. Allyn & Co., Inc.
(jointly); Lee
Higginson Corp. and Carl M. Loeb, Rhoades & Co. (joint¬
ly); Stone & Webster Securities Corp.

Lehman

headquarters in the heart of New York's great financial

district, Pandick Press, Inc. produces millions of important docu¬
ments

each

schedule; all

SPEED
tees

is

year.
are

one

Most of these

are

printed

on

a

rigorous

delivered "on time."
of the

the finest and

reasons

most

"Printed

by Pandick"

guaran¬

complete printing service available.

it Hawaii (Territory of) (11/16)
Sept. 12 it was announced that it
an

issue

of

andic/(Vress. Inc.
Established 1923

Heine

will

&

WOrth 4-2900

NY 1-3167




71 CUNTON

ST., NEWARK, N. I.

MArfcal 3-4994

Co., New York
received

be

Department
T2 THAMES ST., NEW YORK 6

planned

to

sell

Bids—To be received

Nov. 16 at Bankers Trust Co., New

Bids

of

at

Justice,

the

Underwriters

Pro¬

Lehman

—

merger

"International

Resources

Adviser

—

it

10.

Resources

Canada

of

Inc.". which plans to
total of 3,000,000 shares Of

Fund,

register about Sept. 15-16

ment

Fund,

Natural

of

Resources

a

is expected, will be publicly
Price—$5.75 per share. Invest¬

Capital

Research

Underwriter

&

—

Management

Co.,

Kidder, Peabody &

Co., New York.
Kayser (Julius) & Co.
Aug. 17, it as announced company plans an offering of
stock to its shareholders and borrowing through long-^
.

term bank loans.
Proceeds
To finance acquisition,
through purchase, of the net current assets of Holeproof
Hosiery Co. (latter's stockholders approved proposal
on
Sept. 6).
—

Aug. 8 it

Gas Co.

stated company plans sale of about $10,-

was

000,000 convertible first preferred stock to stockholders.
Underwriter—To be determined by competitive bidding.
bidders:
Lehman
Brothers, Merrill Lynch,
Fenper & Beane and Reinholdt & Gardner
(jointly); White, Weld & Co.; Stone & Webster Secu¬
rities Corp.; Blair & Co. Incorporated. Bids—Probably

Probable

Pierce,

fall.

this

Lanolin

Plus, Inc.
reported company (name to be changed
Cosmetics, Inc.) plans registration in

Aug. 15 it

was

York/ N. Y.

(9/29)
office

Room

664,

of

September

shares

200,000

about

of

common

stock

(part for selling stockholders).
Inc., Cleveland, Ohio
company plans soon to

Lithium Developments,

June
file

it

9

announced

was

that

registration statement with the

a

SEC covering a

proposed issue of 600,000 shares of common stock. Pro¬
ceeds—For general corporate, purposes.
UnderwriterGeorge A. Searight, New York, will head group.
•

Long Island Lighting Co.

(10/26)

it was announced company plans to sell an
issue of
$15,000,000 first mortgage bonds, series H,
due 1985. Proceeds—For construction program.
Under¬
April 23

writer—To be determined by

competitive bidding. Prob¬

Stuart & Co. Inc.; The First Bos¬

able bidders—Halsey,

Corp. and Blyth & Co., Inc. (jointly); W.

C. Langley
& Co.

Co.; Smith, Barney & Co.; Baxter. Williams
Bids—Expected to be received on Oct. 26.

&

Manufacturing Co.

Marquette Cement

directors approved a $16,000,000 plant expan¬
program.
Certain details of financing and en¬

Aug.

12

sion

gineering remain to be completed.
Becker & Co. Inc., Chicago, 111.

Consolidated

Michigan

Gas

Underwriter—A. G,

Co.

reported company may issue and sell this
fall $27,000,000 of first mortgage bonds due 1985.
Pro¬
ceeds—To repay bank loans and for new construction.
was

Underwriter—To be determined by competitive
Probable

bidders:

Halsey,

Stuart

&

Co. Inc.;
(jointly);

bidding.

White,

Smith,
(jointly); Harriman
Ripley & Co. Inc. and Union Securities Corp. (jointly).

Weld

&

Co.

Lehman

and

Brothers

Barney & Co. and Blyth & Co., Inc.

it Minute Maid Corp.
Sept. 12 it was reported registration is expected this
of $8,500,000 4%
subordinated debentures due
1974.
Proceeds—To Clinton Foods, Inc., who received

month

$17,300,000 of these debentures for its Snow Crop Divison.
Underwriter—Merrill Lynch, Pierce, Fenner &
Beane,
•

Sept.

,

Bank of Washington

12 the bank offered to its stockholders of record
date the right to subscribe on or before Oct. 7

said

of
for
on

New York.

National

205,000 additional
the basis of

one

shares of capital stock

new

(par $10)

share for each two shares held.

Proceeds—To increase capital and
Underwriter—Johnston, Lemon & Co., Wash¬
ington, D. C.

Price—$30 per share.
is

$7,500,000 20-year general obligation bonds.

Proceeds—For school construction.
on

shares

15

Inc. (10/10)
Fund, Inc.
Fund, Inc. approved
of the two firms to continue under the name

Aug. 15 it

March

Inc.

expects

some

1956.

to

from its

a

Resources

stockholders

2

Natural

and

bonds.

financing.
Proceeds—For new construction,
which, it is estimated,
will cost about $125,000,0000 in 1955.
Underwriters—
For last equity financing were The First Boston
Corp.
end Glore, Forgan & Co.

$

International

ton

*
company may

between

Of¬

September.

each

for

from Consolidated

additional first

April 14 it

Jan. 24, Willis Gale, Chairman, announced it should be
Fall before the company undertakes its next

from

•

Sept.

when

Fischer & Porter Co., Hatboro, Pa.
Aug. 18, Kermit Fischer, President, announced that the
company expects to offer additional common shares to
the public in the near future. Underwriters—Offering of
participating preference shares in October, 1954, was
underwritten by Hallowell, Sulzberger & Co.; Boenning
& Co.; and Suplee, Yeatman & Co., Inc.; all of Phila¬
delphia, Pa.

1955. Proceeds—For construction program. Underwriter
—May be determined by competitive bidding. Probable
bidders: The First Boston Corp. and Coffin & Burr, Inc.
(jointly); Harriman Ripley & Co. Inc.; Blvth & Co.. Inc.
and Kidder, Peabody & Co. (jointly). Meeting—Stock¬
holders on May 11 voted to increase the authorized

Commonwealth

Laboratories class A stock fi¬

ago.

Blair & Co. Incorporated.

stock,

3,500,000 shares.

Mont Labora¬

Du

by competitive bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; The First Boston Corp.;
Kidder, Peabody & Co. and White, Weld & Co. (jointly);

$10 (probably to stockholders) in the latter part of

to

B.

share

new

Corp.

be determined

four weeks.

3,250,000

Mont

Du

years

10,

July 18 it

Maine Power Co.

from

on

some

31, W. F. Wyman, President, stated that company

stock

one

To retire bank loans.

—

Laclede

Allen

Offering—Not expected until
stockholders of Laboratories will
forming Broadcasting firm.
some

Essex County

Campbell Chibougamau Mines, Ltd.
Aug. 15 it was reported a secondary offering of about
150,000 shares of common stock will be registered with
the
SEC.
Business—Company, recently formed, is a
copper mining undertaking on Merrill Island, Quebec,
Canada. Underwriter—Allen & Co., New York. Offer¬

common

of

corporation, following

that

announced

Kuhn, Loeb & Co. and Van Alstyne, Noel

handled

Oct.

vote

Underwriter—Kidder, Peabody & Co., New York.

fering—Probably in

Co.

after

Burlington Industries, Inc.
Sept. 5 it was reported company plans equity financing.
.

common

stockholders

derwritten.

outstanding 5% convertible preferred stock,
to procure funds for redemption of such shares.

par

was

offered

presently

additional

of

27; rights to expire about Nov. 10.

Brothers, Goldman, Sachs & Co. and The First Boston

Broadcasting Corp.

it
to

tories, Inc. of 1,000,000 shares of common stock as a
dividend, contemplates that additional shares will be
to its stockholders.
This offering will be un¬

Aug. 26 it was announced stockholders will vote Sept. 29
on authorizing the directors to create, issue and dispose
of 5%
income debenture bonds to be exchanged for

some

Beane

Mont

10

issuance

to issue and sell

ceeds

basis

of Oct.

as

Los Angeles, Calif.

Du

New York.

plans

the

on

ers

held

which,

&

to the

Indiana P. S. Commission for authority to offer 209,685
additional shares of common stock to common stockhold¬

Oct.

Aug.

Central

it Indianapolis Power & Light Co. (10/28)
8 it was announced company has applied

Sept.

about

000,000 of notes or debentures, to be used for general
corporate purposes. Underwriter—Lee Higginson Corp.,

Dec.

sold, together with the notes, in units.
are reported
to be going on
Co., Inc., San Francisco, Calif., and Scharff
Jones, Inc., New Orleans, La.

with Blyth &

stock,

pected of $8,000,000 of subordinated debentures due 1970.
Proceeds—Together with funds from private sale of $3,-

or

be

offered

Fenner

Proceeds—To increase capital and sur¬

ing—Not expected for three

would

capital

& Co. and Merrill Lynch, Pierce,
(jointly); Carl M. Loeb, Rhoades &
Co.; Blyth & Co., Inc. and The First Boston Corp.
(jointly); White, Weld & Co. and Shields & Co. (joint¬
ly); Lehman Brothers. (3) On preferred stock—Blyth
& Co., Inc. and The First Boston Corp. (jointly); White,
Weld
&
Co.
and
Shields
&
Co.
(jointly); Lehman
Brothers; W. C. Langley & Co. and Union Securities
Corp. (jointly); Morgan Stanley & Co.

•jfr Barium Steel Corp. (10/3-7)
Sept. 12 it was reported that early

Stock

Underwriters—Discussions

Kidder,

being offered for subscription my stockholders of record
Sept. 13, 1955 on the basis of one new share for each 10
shares held; rights to expire on Oct. 6, 1955.
Price —
$70 per share.

construct a 961-mile pipe line from a point near Baton
Rouge, La., to Cutler, Fla., to cost approximately $110,382,000. It plans to issue and sell $81,200,000 of bonds,
about $20,000,000 of 5V2 % interim notes (convertible into
preferred stock), and over $8,700,000 of common stock.

(jointly); W. C. Langley & Co. (2) For common stock
(which may be first offered to stockholders)—W. C.
Langley & Co. and Union Securities Corp. (jointly);

13 stockholders approved the issuance of 52,200
shares of capital stock (par $20), which are

additional

plus. Underwriter—Blyth & Co., Inc. and Dean
& Co., both of San Francisco, Calif.

(Texas) Gas & Oil Corp.
Aug. 26, company applied to the FPC for authority to

&

Co., New Yoi'K.

Delaware

indebtedness
Glore, Forgan &

Co.; Halsey, Stuart & Co. Inc.; and Alex. Brown

vote

stock

common

$15,000,000.

mortgage

Underwriters

mortgage.

one

all

Stockholders will

authorized

exchange and sale $280,000,000 of first consolidated mortgage bonds, in three
series, viz: $80,000,000 of series A 3%s, due Aug. 1, 1970;
$80,000,000 of series B 4s due Sept. 1, 1980; and $120,000,C00 of series C 4y4s due Oct. 1, 1995. Through Sept. 9,
1955, holders ot refundable bonds had the right to
exchange thern, par-for-par, for not more than $60,000,000 of series A bonds, $40,000,000 of series B bonds and
$20,000,000 of series C bonds. The new bonds will be
allotted for sales and exchanges up to Sept. 19 in order
of receipt of acceptances. As of noon (EDT) on Sept. 12,
$139,817,000 of the bonds had been sold or exchanged.
Prices—Of series A, 99%; of series B, 98%%, and series
C, 100%; with accrued interest in each case. Proceeds—
refund

plans to raise

company

snares; the authorized serial preferred

Aug. 30 the railroad offered for

To

announced

was

public,

RR.

Ohio

it

12

Inc., New York.

Houston

proximately $6,500,000 from the sale ot common stock to
up to $b,500,600 from borrowing on a long term

England, President, announced that the
the sale to the public of a
fcmall amount of common stock early next year. Under¬
writers—Probably Union Securities Corp. and Smith,
Barney & Co., both of New York.
L.

directors are now considering

Baltimore

& Co.

it Copperweld Steel Co.

City Electric Co.

1, B.

Aug.

Heller (Walter E.)
& Co.
July 18 it was reported that the company may^be con¬
sidering some new financing. Underwriter—F. Eberstadt

Stanley & Co.; The First Boston Corp.

39

Prospective Offerings
Atlantic

Thursday, September 15,1955

...

of

Alien

101

Property,
Indiana Ave.,

surplus.

National

Fuel

Gas

Co.

Aug. 23 company filed with the SEC an application to
offer its common stock in exchange for shares of Penn¬

sylvania Gas Co.,
1.45

National

a

shares

principal subsidiary, on a basis of
for each Pennsylvania Gas share.

W., Washington 25, D. C., up to 11 a.m. (EDT) on
Sept. 29 for the purchase from it of 1,068 share* of cap¬

SEC will open

ital stock

Aug. 3 it was announced that stockholders approved
a plan of recapitalization and plans to raise not less than

N.

shares

of

(par $24), constituting all of the outstanding
company.
Proceeds — From sale of 943

this

shares to go to the Attorney General of the United States
and from sale of 125 shares to go to another stockholder.

New

$300,000

hearings

on

Sept. 20.

Haven Clock & Watch

of

new

nolds & Co., New

capital.
York.

Co.

Underwriter—Probably Rey¬

Volume 182

Number 5464

...

The Commercial and Financial Chronicle

(1105)
New York

State

& Gas

Electric

Corp.

New York

Webster

Securities Corp.. The First Boston
Corp. and
Smith, Baraey & Co. Halsey, Stuart & Co. Inc., is reported to head a group to bid for
approximately $25,000,-

(10/19)

July 8 it was announced company plans to issue and
sell $25,000,000 of first mortgage bonds due 1985. Pro¬
ceeds—To repay bank loans and for new construction.
Underwriter—To be determined by competitive bidding.
Probable bidders: Halsey, Stuart & Co. Inc.; Kidder,
Peabody & Co.; Harriman Ripley & Co. Inc.; The First
Boston Corp. and Glore, Forgan & Co. (jointly); Blyth
& Co., Inc. and Smith, Barney & Co. (jointly); BidsExpected to be received on Oct. 19.

'

000 of bonds.

Sept. 12 it

capital money to aid in carrying out its expan¬
and improvement program which will cost ap¬

proximately $200,000,000. Underwriter—For any bonds,
be
determined
by competitive bidding.
rroDaDi*

announced

stock

Satv

of

stockholders

Bell

to

Oct. 17.

on

be

stock

12

shares

Nov.

22.

be named

on

(par $5)
held

Warrants
for

and

Sinclair

1,507,303

on

basis of

a

Nov.

or

necessary

purposes

in

from

1955

to

outside

obtain

funds

for

sources—at

of several million dollars."

least to the extent
The company has scheduled

large-scale expansion program,

involving $79,000,000

in order to keep abreast of estimated
the next five years.

load growth over

Underwriters—Probably Stone

&

secured

through competitive bid¬
ding frequently find themselves a
bit

removed

from

such

comfort¬

sold

to provide the

subsidiaries

in

of

Another

For

with

2.

beaten-path

ing of $50 million of 21-year first
mortgage bonds, brought out with

loaded

a

37/h%
101.06

of

3.80%,

mand

rate

coupon

at

and

for

an

encountered
was

out

priced

and

indicated

yield

brisk

reported

de¬

moving

rapidly.
persistent hardening of
But in the case of Utah Power
money rates, the new issue market
still
is
subject to considerable & Light Co.'s $15,000,000 of 30buffeting. But it is plain, from year first mortgage bonds priced
the way things have been shaping at 102.31 to yield
3.50%, the mar¬
up, that prospective borrowers can ket, initially at least, was some¬
find accommodation if they are what
slow
in
reaching for the
issue.
willing to pay the going rates.
Here, of course, the successful
By the same token it is evident
that buyers are in control of the banking group was hampered by
Beset by

rather wide

and

company

addi¬

needed

well

only

into

life,

many

securities

it

was

terms

proper

off-the-

which
of

much

that

necessary

for quick success of this venture.

since

And

the

borrowing com¬
pany's officials, by sheer dint of
their
own
business, must keep
fully abreast of current conditions
in

the

market, it was
pretty much accepted that they
would recognize such conditions
in arriving at final details with
their

money

bankers.

pons

and

yields

are

not

to

their




ice
to

units

of

notes

and

York

June

it

issuance

Next Week's

The
week

new

issue

expected

to

be

pipe line scheduled
19. Underwriter—East¬
-Offering — Expected in

new

was

and

announced

company contemplates the
later this year of a new series of
it»

sale

mortgage bonds, in an aggregate amount not ye3
Proceeds—To pay for new construction

determined.
and

probably to refund an issue of $560,000 4%% firs3
mortgage bonds due 1978.
Underwriter—May be deter¬
by competitive bidding.
Probable bidders; Hal¬
sey, Stuart & Co. Inc.; A. C.
Allyn & Co. Inc.; White,

mined

Weld & Co. and Shields &
Co. (jointly).
possible that issue may be
placed privately.

&

with

Gas

Co.

bankers,
shares

This

is

slated

also

&

Com¬

is engaging in a securities
business from offices at 105 Ease
4th Street.
Alex L. Kallay is a

principal of the firm.

$25,000,000

of

preferred

r

With Kalman Co.

the

(Special to The Financial Chronicle)

considerable

a

spell.

Friday,

is

Miller & Co. Opens
TULSA, Okla.—Miller

undertaking has been
for

It

pany

Thursday, Public Serv¬

simmering
On

are

issue

to

probably

County Gas Co., York, Pa.

29

first

Electric

stock.

Bonds

October.

250,000

or

stock.

Dillon & Co., New York.

man,

bring to market, through nego¬

tiation

Co., Ltd.

to

for bids to put in funds
bank loans and finance

on

by

Securities

reported company now plans
publicly about $20,000,000 of securities,

23rd,

by

the

negotiated

route,
Detroit
Steel
Corp. will be offering, through its
bankers, $30,000,000 of 15-year,

ST. PAUL,
Minn. —James T.
Wilson has become connected with
Kalman & Company, Inc., Endicott

Building.

first mortgage,

sinking fund bonds
along with 503,155 shares of com¬
mon stock
going directly to stock¬

Forms Capital Sees.
(Special to The Financial

holders.
Calendar

With

calendar in the

ahead
bids
fflir
to
spread in the bids.
keep
paid the company 101.629 for a underwriters
moderately
active
3%% rate while the .lowest of and is evenly divided between
liking a given undertaking can
seven bids
submitted, all for the negotiated and competitive bid¬
experience rough sledding.
same rate, was 100.38.
ding deals as far as the top under¬
The market continues to be one
takings are concerned.
in which underwriters, fortunate
C.I.T. Financial Today
On
Tuesday Ohio Power Co.
enough to be handling negotiated
Dealers reported
decidedly en¬ will open bids on $17,000,000 of
business, are able to price such
couraging preliminary inquiry for first mortgage bonds and 60,000
deals realistically and develop a
ready market. On the other hand, C.I.T.-Financial Corp.'s $100 mil¬ shares of preferred. The following
those who come up with deals lion of
15-year debentures being day Columbia Gas System, Inc»
market currently and that if cou¬

a

And

Corp.;

extended

was

construction.

new

bidding.

Securities

Underwriter—Union

$45,000,000 of 25-year deben¬

repay

fit

portfolios

apparent
were

has

tures up

competitive

holdings has been

placed privately. Hearings on
begin before FPC on Sept.

on

Price—To

to

those

maturities

with

longer

of

one

example,
Tennessee
Gas
Transmission Co.'s current offer¬

so

1955.

in

Proceeds—To repay
additional stock of

tional working capital.

able circumstances.

their

21,

April 25 it

Corp., Ladenburg, Thalman & Co., Carl M. Loeb,
Rhoades & Co. and Wertheim & Co.
(jointly); Blyth &
Co., Inc., Bear, Stearns & Co. and Dean Witter & Co.
(jointly); Union Securities Corp. and Equitable Securi¬
ties Corp. (jointly); Lehman Brothers; Morgan
Stanley
& Co.; Kidder,
Peabody & Co., and Merrill Lynch,
Pierce, Fenner & Beane.
Bids—Tentatively scheduled
to be received up to 11 a.m. (EDT) on Nov. 1. Regis¬
tration—Not expected until Sept. 30.

construction

sell

Dec.

to

and sell

share for

new

Nov.

on

Oct. 31.

investment

one

shares

rights to expire

1;

mailed

on

additional

by

Webster

Corp., New York, underwrote recent sale of Sinclair's
holdings of Colorado Interstate Gas Co.
White, Weld &
Co., New York, may be included among the bidders.

Boston

be

may

SEC

subsidiary companies.
Underwriter—To be determined
by competitive bidding.
Probable bidders: The First

Puget Sound Power & Light Co.
April 5, Frank McLaughlin, President, said that "it will

&

Westcoast Transmission

be

by company

loans

Stone

Westpan Hydrocarbon Co.

company plans to offer first

about

to

determined

was announced Sinclair Oil
Corp. has agreed!
with the SEC to divest itself of
its investment of 384.380
shares of Westpan stock
(52.8%). The time in which

(11/1)

stockholders

common

be

bidders:

March 2 it

determined

on

issue

to

Merrill, Lynch, Pierce, Fenner & Beane.

Co.

Registration—Planned for

announced

was

each

>/

•

a

Telegraph

Underwriter—To

program.

Southern Co.

Aug. 29 it

Kidder,

bank

(EDT)

&

(jointly).

sell 125,000 shares of
cumulative preferred stock
(par $100). Proceeds—For construction
program.
Un¬

about Sept. 28.

received

Puerto

noon

Telephone

& Co.

and

by competitive bidding. Probable bidders: Halsey, Stu¬
art & Co. Inc.; Morgan
Stanley & Co. Bids—Expected to

Sept. 21 for $2,500,000 public im¬
provement bonds of 1955, series A, dated July 1, 1955,
and due annually July 1, 1956 to
1972, inclusive.

for

to

McGowen, President, stated that com¬
might be doing some debt
financing. On Aug. 26

derwriter—To

be received

Corp.

C.

Probable

common

up

of

stock

financing was
by Hunter Securities Corp., New York, who
stated, will not underwrite the new preferred, issue.

by the Government Development
Rico, 37 Wall St., New York, N. Y.,

Bank

issuance

preferred

$17,500,000.

Read & Co. Inc., New York.

Virginia Electric & Power Co. (12/6)
Aug. 2 it was announced that company
plans

Proceeds—For

construction

(9/21)

convertible

*

by competitive bidding. Probable bidders:
Halsey, Stuart & Co. Inc.; The First Boston
Corp.; Mor¬
gan Stanley & Co.;
White, Weld & Co. and Equitable
Securities Corp.
(jointly); Harriman Ripley & Co. Inc.

Gas Co.

authorized

cumulative

'

-•

Instrument Corp.

it was announced that "such
additional funds as may be
needed will be obtained
by bank loans and if conditions
warrant some form of debt
security." Underwriter—To
be determined

(10/17)
Aug. 22 it was announced the directors have authorized
the issuance and sale of
$30,000,000 40-year debentures
to be dated Oct.
15, 1955. Proceeds—To be applied to

(9/29)

(Capital of)

Gas

N.

and Goldman Sachs

Southern

noon (EDT)
Sept. 29, in Philadelphia, Pa., for the purchase from
it of $7,965,000 equipment trust
certificates, series DD,
to be dated Nov. 1, 1955, and to mature in 15
equal
annual instalments of $531,000 each from
May 1, 1956
to
Nov.
1, 1970, inclusive.
Probable bidders Halsey,

be

24,

pany

it is

on

will

Feb.

handled

Corp.; Smith, Barney & Co.; Harriman Ripley &

if Puerto Rico

United

110,000
(par
exploration and drilling program,
etc. Underwriter—Previous common
stock
$10).

Bids will be received by the company up to

Bids

(11/29)

reported company plans to sell
$18,000,000
Proceeds—To repay bank loans and for

of

Precision

Business—Manu¬
.

was reported
company plans to sell addi¬
tional first mortgage bonds later
to finance cost of new
construction, which is estimated at about

was

30

stock

common

Texas Gas Transmission
Co.

Proceeds—To further the
building
corporate purposes.
Under¬

&

2,610 shares of

March 15 it

basis.

general

Oil

(10/11)

of

approximately 31.99% of the
outstanding. Proceeds—To the

Underwriter—Dillon,

South Texas

Co. Inc.

Hutzler;

l-for-7

a

Nov. 29.

on

Underwriter—To be

&

for

on

Co., Inc.; Union
Corp. and Merrill Lynch, Pierce, Fenner &
(jointly); Lehman Brothers; The First Bostpn
Corp.; White, Weld & Co. and Shields & Co.
(jointly.
Bids—Expected to be received up to 11:30 a.m.
(EDT)

shares

Bros.

share.

stockholder's

Office

June 6 the stockholders
voted to approve an
authorized
issue of 500,000 shares of
first preferred stock
(par $10),
of-which 300,000 shares
(to be convertible into common)
are to be
publicly offered. Proceeds—For working
capi¬
tal.
Office—Buffalo, N. Y.

Securities

by competitive bidding. Probable bidders:
Kuhn, Loeb & Co.; W. C. Langley & Co. and Glore, For¬
gan & Co. (jointly); Kidder, Peabody & Co.; The First

Salomon

the

This represents
stock issued and

Sterling

Beane

determined

Inc.;
Peabody & Co.

received at

of

Attorney General of the United States.
factures and sells carded cotton
yarn.-

Underwriters—To be determined
by com¬
petitive bidding. Probable bidders:
Halsey, Stuart & Co.
Inc.; Salomon Bros. & Hutzler; Blyth &

reported company proposes Issuance and
sale of $7,500,000 of preferred stock later this year. Pro¬

Co.

be

(par $100).

construction.

was

&

to

Diego Gas & Electric Co.

bonds.

Aug.

Stuart

will

Alien
Property,
Justice, Room 664, 101 Indiana
Ave.,
W., Washington, D. C., up to 3
p.m. (EDT) on Oct. 11

N.

new

Electric Co.

^ Pennsylvania RR.

(par $2)
per

Aug. 2 it

Inc.

Boston

Bids

Department

Insurance Co.

writer—None.

probable bidders: Halsey, Stuart & Co. Inc.; The First
Boston Corp.; Kuhn, Loeb & Co.; Kidder, Peabody &
Co.; Equitable Securities Corp.; Harriman Ripley & Co.,

program.

* Spray Cotton Mills,
Spray, N. C.

—

and

program

reported company fclans to Issue and sell

construction

Under¬

To increase financial

—^

Price—$8

later this year $9,300,000 of first mortgage bonds. Pro¬
ceeds—To repay bank loans and for new construction.
Underwriter—To be determined by competitive bidding,

ceeds—For

exceed

resources of company.
Lehman Brothers and Lazard
Freres &
both of New York.

mon

Pennsylvania Electric Co.

Feb. 21 it

not

months.

Rye National Bank, Rye, N. Y.
Aug. 30 it was announced stockholders will vote
Sept. 22
on
approving a proposal to offer 52,300 shares of com¬

Inc.; Blyth & Co., Inc. and The First Boston Corp. (joint¬
ly); Merrill Lynch, Pierce, Fenner & Beane, Kidder,
Peabody & Co. and White, Weld & Co. (jointly); Equit¬
able Securities Corp. and Union Securities Corp. (joint¬
ly); Smith, Barney & Co.; Lehman Brothers and Riter
& Co. (jointly); Glore, Forgan & Co.

Pennsylvania

12

common

Co.]

for 1955 will approximate $31,000,000.
Present
plans contemplate these funds will be obtained tem¬
porarily from short-term bank loans to be repaid from
proceeds of the sale of additional bonds late in 1955 or
early 1956. Underwriter—To be determined by competi¬
tive bidding.
Probable bidders: Halsey, Stuart & Co.

was

the next

was

Underwriters

,

ments

Feb. 15 it

would

at the discretion of the

Radio Corp. of America
Sept. 2 the directors discussed the
advisability of issuing
$100,000,000 of subordinated convertible debentures. Pro¬

capital require¬

new

This

for the purchase
from it of

ceeds

(Minn.)

that

issue.

Brothers, New York.

to

was

Oct. 20.

reported registration is expected late this
month of about 90,000 shares of common
stock. Proceeds
—To go to selling stockholders.
Underwriter—Lehman

bidders: Morgan Stanley & Co.; Halsey, Stuart & Co. Inc.
Northern States Power Co.

on

writer—Probably Smith, Barney & Co., New York.

new

it

debenture

directors any time within

Keith S. McHugh, President, announced that
the company will have to raise more than $100,000,000

29

convertible

a

$50,000,000 and would be issued

17,

March

to meet

April 9 stockholders approved the possible issuance of

if Quaker City Life

of

are

Southern Pacific Co.
(9/22)
Bids will be received
by the company up to noon
(EDT)
on Sept. 22 for
the purchase from it of
$9,390,000 equip¬
ment trust
certificates, series RR, to be dated Sept.
1,
1955 and to mature in
15 equal annual
installments to
and
including Sept. 1, 1970. Probable bidders:
Halsey,
Stuart & Co.
Inc.; Salomon Bros. & Hutzler;
Kidder,
Peabody & Co.

Pure Oil Co.

Telephone Co.

Jan.

sion

Stockholders

41

Renyx, Field

(Special to The Financial Chronicle)

It

NEW
J.

ORLEANS,

Hattier

with

has

La.—Rosario

become

Company

with
offices
at
2909
North Sheridan Road to engage in.
a securities business.

connected

Mgmt.

(Special to The Financial Chronicle)

WORCESTER,
Smith

staff

CHICAGO, 111. — David Sher¬
has formed Capital Securities

man

Renyx, Field & Co., Inc.

With Federated

W.

Co.

ChroInicle)

of

has

Mass.

been

Federated

—

Arthur

added

to* the

Management
Corporation, 21 Elm Street.

Dr. M. Edwin Bry
Dr.

M.

Edwin

Bry, member of

the New York Stock Exchange, a

partner in Spear, Leeds & Kellogg
New

York

City,

passed

Sept. 11 at the age of 64.

away

I

42

The Commercial jind Financial Chronicle...

(1106)

Bullock Plans Rise
•

$10,000,000' of

than

More

Scudder Assets

Mutual Funds

Net

among

derstanding
the

investors

of

and

operation

of

objectives
fund

mutual
the

purchase plans and

of long-range period

appeal

Popularity of plans for regular
purchase

of

mutual

funds

vestors opened

10,362 new accum¬
ulation accounts, the National As¬

vestors

sociation

071,000.

ies

of

Investment

|

each

the

or

were opened

three

9,253

an

■

of bonds, preferred and common
stocks selected because of their

.

preceding

reported

for

$31,894,000 in August, below
the $32,750,000 redeemed in July
were

of

this

the Association re¬
pointing out that mutual
year,

ported,

of

assets

Association's
com¬

assets of $7,203,660,000
end of July.
Total assets

crease over

at

were

I

the

(mutual fund)

pany members were at $7,286,002,000 on Aug. 31, 1955, a slight in¬

I

the

$6,109,390,000

i955.

on

<

Jan.- 1,
V

Investor purchases of new mu¬
tual fund shares during August

value

their shares.

of

redemptions

for

the

Total

eight
months of 1955 amounted to $314,615,000.

Cash, U. S. Government securi¬
ties

and

short-term

obligations

held by the 117 mutual funds to¬

Business

Business

conditions
of

better

than

Moyer

,

Kulp,

Sales

%

this

ord

during the
will be

of July.

employment

workers

year

expected

earlier, A.
Vice-President and

prices,

of

continuation

of

consumer

The

increase

shares

during

in

outstanding
first quarter

the

reflects the sale

Aug. 3 of

on

an

additional 250,000 shares for $10,-

292,500.

The report stated that the

is.ir proceeding

Common

with

stock

the' in¬

investments

national

Convention

Mutual

in

New

Aug. 31, in Canadian dollars,

were

valued at

$41,659,921, or 82.1% of
net assets; Government of Canada
securities, $7,543,638, or 14.9%;
other bonds and

notes, $1,197,262,

2.3%;.preferred stocks, $198,500,
0.4%; and net cash, $148,197,

or

0.3%.

or

The

largest

holding

group

stocks

metal

was

were

of
and

valued

$10,003,501, or 19.7% of net
Other major group invest¬
ments included petroleum shares,
$7,645,751, or 15.1%; construction,
$4,682,153, or 9.2%; paper, $3,607,-

in

1955

and

the

remainder of the year, Mr.
Kulp stated that the improvement
has
been
"sparked"
by
the
extraordinary good sales enjoyed
by the automobile industry.

putnam fund Dictuwtom. inc
$0 State Street, Bostoft

<*■■■■■»
'■■■■a

in

companies.
stocks

$15,348,488,
578.78.

of

as

of

Government

64.2%

000

were

surance

value

of

$17.09 per share

or

$23,924,203.76,

of

of

in

as

total net assets, number

stockholders

and

standing. Assets

30

share

stabilize the rise

shares

out¬

Mr. Kulp stated that the recent
rec-

on

a

$1,512,207.71

$975,389.54

Aug.

net gain of 55% for

period. The net asset value
increased

share

debt, he said.

were

with

compared

repayment period to 25 years from

between

booming

business

and

tightening

credit.
Moreover, it
that it will remain in this

to

state

for

time

some

come," according to Harold X.

Schreder,
dent

Executive Vice-Presi¬
Group Securities, Inc.,

of

leading mutual fund.
In

address before the Seventh

an

Annual

the

at

Mutual

Hotel

Sept.

on

"we

Fund

Statler,

12,

Mr.

Conference

New

York,

Schreder

said

the

basic

■
Investment in
mon

Investment fund

economic

measure¬

a

diversified list of

com¬

1

1

stocks selected for their investment

on

June

He

30,

1955,

$9.44

1954
an

per

expressed

the managers of

geting and

confidence
our

monetary

successful

that

nation's bud¬

Established 1925
muiual fund >vitl a
portfolio of securities

'""L'iTa'l" and

BULLOCK

A

to

per

$12.53

increase of

...tttJE*....

Mutual

prinve
lurn as

income.

affairs will

"stretching out"
today's good business, and gen¬
erally maintaining our economy's
long-term
so,

growth

pattern.

Even

he warned his audience of the

of a "moderate adjust¬
period, possibly during 195758, before we rise from today's
$385 billion national production
level to a $550 billion level
by

ment

or

to

the

not

stock

question

prices

of
cur-

Addrew.




mutua

*

*

H.

Child

banking industrie

have long dominated
estate planning by

the

field

with

personnel

comprehen

sive

training and then by follow
this training with tax an
estate
planning
guides
geare

ing

up

either to insurance sales
services
of
bank
trust

or

to th

depart

ments.
"The
mutual
fund
industry,'
Mr. Child said, "has now
acquire
the broad public acceptance an
detailed
enter

knowledge

into

field

on

estate

scale

petitive basis.
vide

□ Incorporated Income Fund

t

plannin
and

com

Mutual funds pro

ideal

an

sufficient

the

large

a

modern

investmen

instrument for the performance o
estate planning activities."

many

The

Mutual

Estate

concise

a

Plannin

of

and

definitiv

information

to

mutua

dealers

this

competence

int

the

investor,

this

servie

will provide a method of keepin
abreast of new opportunities fo
tax

savings," he said, "and to th

mutual

fund

dealer

opportun

an

ity to greatly increase the servic
he renders his customers."

Early
issues
of
the
Mutua
Estate Planning Service will cove
the general aspects of estate plan

ning. Future editions will high¬
light and analyze specific prob¬
lems as they apply to mutual fund
The

salesmen.

will

M.

issued

be

P.

E.

the

first

Servic
week

of

each month.

tained that the intrinsic values

a

risk of

prmctpal.

strong up-trend for the past 15
and that their sharp price

advances
have
up

with

little

last

Current

prices

are

two

year

than

more

advancing

declared,

catc"

values.
average, h

stock

on

still within

a norma

of intrinsic values and wil

range

probably
values

continue
such

around

tors'

the

of

done

to

to

fluctuat

moderately

reflect

shifts

in

risin<
inves

sentiment.

Such

sentiment presently re
"confidence," but not nec¬
essarily the type of "exuberance"

fleets

that in the past has lead to "wild"

price

excesses

such

as

in 1929.

Investment

objectives of tbis Fuad
long-term
capital
and
income

growth

Berkeley St., Boston, Mass.

for

its

Prospectus

i

shareholders.

upon

request

«

Address-

•

i

i

City......

..

»

..I

Lord, Abbett & Co.
New York

—

Chicago

—

o

years,

Fund

Please send a Prospectus on
□ Incorporated Investors

o

providing thei

sales

A Common Stock Investment Fund

Name

J

commercial

large an INCOME

ONE WALL STREET, NEW YORK B

Kmm_

of

*

planning.

Jr., President of Wall Street Man
agement Corp., the insurance an

°lJiec*lvCTi^pnMF

•re

J

estate

in

Affiliated

fund

obtainable --boat

..mine

The Parker Corporation, 200

t

aspects o
It will stress i

role

%

According to Josiah

in

WW

Selected

Established 1894

funds

the

Incorporated

a,

CALVIN

particular

representative stocks have been i

likelihood

from

Aug. 31,

33%.

A

quality and income possibilities.
Bend for a free copy of the
booklet-pros¬
pectus by mailing this advertisement to

stock

continue high and generally rising
as far as can be seen
into 1956."

W Investors %

offering

common

planning.

rently are correctly evaluating ou
prosperity, Mr. Schreder main¬

Turning

mutual

estate

currently enjoying the ul¬
timate in dynamic prosperity, and

whether

a

the

are

1965."

If

objective, expert in formatio

on

"To

"Tug-of-War"

be

down

increases, plus

b

fer

translating

strongly indicate that total
production and consumption will

Aug. 31, 1955 shows record high

fiures

the

round of wage

will

increased sales.

all

Sovereign Reports

31, 1954, or

in mortgage

the 1,400,-

on

Sovereign Investors reporting

Residential housing

should

in¬

shares outstanding.

payments and the reduction in the

years

and
life

now

regulations requiring

Says

Market Now In

in U. S.

Net assets had

repayments would tend to correct
field

of

of

Service

ments

at the
highest level in our history, is
causing some concern, particular¬
ly because of the rapid rate of
the increase brought about large¬
ly by auto sales. Levelling off of
auto sales plus heavy and constant
this situation.

$2,918,37.5%

were

stocks

of

was

obligations,
in

companies.

market

a

31

of

July 31,

the fund's net assets

stocks

value

July

gain

a

As

the

The

P.

wishing to acquir
professional competence in estat
planning and in the methods o

"The stock market is suspended

invested

was

26

these

ed to continue.

3, PA.

by the

Schreder

'tug-of-war'

of

required by ex¬
panding communities. Third, large
expenditures
by
industry
for
plants and equipment are expect¬

investment dealer

report issued

E.

Service, Mr. Child continued, wil

909.02

services

M.

tion among the nation's securitie
salesmen and dealers and will of

$1,160,646,

2.3%.

appears

and sewage systems and the many

Prospectus from

equipment,

1,400,000 shares of stock, $12,429,-

other

19281

26

of

Of the $21 million received Feb.
3 from the initial sale of the fund's

First, the urgent need for a longbuilding program. Sec¬
ond, spending by states and mu¬
nicipalities must continue at a
high level to fill the urgent need
for more schools, hospitals, water

credit,

stocks

Corp

$6,500,000 mutual fund.'

a

The

source

mutual fund.

range road

Consumer

the

of

semi-annual

dustries is good, based on a num¬
ber
of
very
favorable
factors.
■■■■■■■

value

Management

manager and distrib
Wall
Street
Investin

of

fund

tors, Inc., has increased by 23.5%
since Feb. 3, according to the first

Outlook for the construction in¬

■■■■■■■■■■■■■■■■■

beverage, $2,296,606, or
steel, $1,403,425, or 2.8%;

electrical

life insurance companies in
the
portfolio of Life Insurance Inves¬

for

prospects

utor

Reports Half-Year Gains

York

Street

investment

offer

The

far

and

4.5%;
or

Reviewing the rise in business
so

Wall

Life Insurance Fund

Fund

Plannin

especially for the mutual fund in
dustry, was issued yesterday b

on

food

and retail trade.

Estate

capital.

new

rising

a

expenditures

Mutual

brought out monthly for distribu

retail

65-million

The

Service, first guide in the tax an
estate
planning
field
designe

Corp.,

913, or 7.1%; banking and finance
shares, $2,653,000, or 5.2%; mer¬
chandising, $2,621,750, or 5.2%;

firmer

suggests

in

trend

City.

^Jjoiton
of

PHILADELPHIA

the

at

Estate Guide

doilars, equivalent to $37.41 on the
1,000,000 shares then issued.

common

committee of the $470,000,Wellington Fund, stated at the

000

seventh

or

earlier,

Corp.
Issuing

close of the fiscal year, net assets
to $37,419,467, in U. S.

at the end

ment

PUTNAM

your

months

or

Prospects For Rest
Expected

Executive Director of the invest¬

FOUND EP

on

at

remainder

FUND

the

share

a

assets.

New York

'Seor^o

Three

talled $422,394,000 at the end of
August, representing 5.8% of total
net
assets.
This
compares
with
holdings of $382,841,000, or 5.3%

Of 1956 Better Than

Fl/ie

dollars,

mining shares which

Established j 930

"

S.

or

1,250,000 shares outstanding at
the end of the period.

first

or:

Corporation

New York 5,

$50,-

dollars

$41.18

vestment of the

started

National Securities &

120 Broodway,

U.

to

fund

J

relatively high current yield and
reasonable expectance of its con¬
tinuance with regard to the risk
involved. Prospectus and other
information
may
be obtained

Research

in

equal

asset

been

117 open-end

diversified group

of

the

ings into cash equal to the current

have

Net

investment dealer

$790,-

latter

fund shareholders have the option
at any time to convert their hold¬

Series

from your

of

with

monthly

by in¬
vestors in the first eight months
of 1955, according to the report.

mutual fund, the primary ob¬
a

to

$51,471,330

Fund

totaled

year

Canadian

plans

through
National Speculative

investment in

amounted

year

by

in

May, 9,942 for June and 9,654 for
July. A total of over 74,000 new

Relatively High Income

jective of which is ta provide

shares

Share redemptions by investors

quarterly investment
months,

this

Scudder

Aug. 31, 1955, the
company's first fiscal

amounted

reported.

Over 9,000 plans for

a

Compan¬

of

fund

in¬
the first eight months

in

the

747,518

$91,240,000, slightly below
purchases
of
$96,756,000.
of

of

of
on

quarter of the

totalled

July

Purchases

in

Investing for

shares

continued during August when in¬

programs."

accumulation

ft

end

Mutual Fund Plans Increase

the Calvin Bullock

by

management to "the increased un¬

assets

Canada Ltd.

By ROBERT R. RICH

sharp

attributed

Now

Dividend

rise in Thrift Plan
accounts which took place during
the first seven months of 1955 was
The

Wall Street

At $50 Million

the

$197,448,000 of total assets of Cal¬
vin
Bullock's
Dividend
Shares,
Inc., are now held in
Thrift Plan accounts.

Thursday, September 15,195

Atlanta

—

Los Angeles

He

Volume 132

Number 5464

The Commercial and Financial Chronicle

...

(1107)

projected

Mr.

within

range

future.

Schreder

pointed out that,
"confidently high" level of

at the

the

trading

a

"average" stock in the market,
risk in holding carefully-se¬

the

Investors,

of current Jevels for the inV:

10%

tcrmcdiate

lected

stocks doesn't ap¬

common

Inc.

-other"mutual funds, all

Prfcllc T
1

fl
OllS JLiCcluLCrS
iidl

he

would

see

me

about

ties.

;««•"-

.t.

me

Long and Company, Inc., of Eliz-

1

.

V "

i-vc.v.

Americans in 1975 will work six
fewer hours each week

These

long-range

American

life

unteered

in

from

estimates

1975

103

com-

_••
pear to be abnormally high "since
.^represented in the investpaid 25% more Tor theif
labdrsh.^hrrj^ti portfolio of Fundamental
relatively few stocks have formed
./ WeekendV drivers
bent /upon Investors; whose
63,520 shareholdmajor distributional tops in tnis~
making the most of their added err and
market so far." However, he ex¬
$300,000,000 in assets make
leisure will find the "open road"
the institution one of the nation's
pressed
tr.e
opinion
that "the
crowded with 80 million passeninternal character of the market
largest mutual funds,
ger cars in contrast to today's 50
Industries
for
which
20-year
appears
to
be
in a period of
million.
projections were made range from
change, and it must be watched
The nation's population will hit
electronics through retail trade,
with more than ordinary care for
an
all-time peak of 213 million,
business machines, mining, metals,
opportune 'cross-overs' to less ad¬
California will replace New York
rubber, steel, installment financvanced, lower risk, sound divi¬
as the most populous state.
Em- ing,
banking, paper and paper
dend-paying stocks."
ployment will increase from 1955's
products,
food
and
containers,
He
added
that
"there
is
no
65 million to a record 85 million,
chemicals, building and construcdearth of such opportunities today
And material welfare will cease
tion, utilities, automotive, and pebecause only about 25%
of the to be a
problem, for the first time troleum.
.

,

^

listed

substantially,
the

of

stocks

common

issues

risen

nearly

while

have

35%

still

selling be¬
low their last bull market highs
are

of

1946, with the rest of the stocks
priced somewhere in between."
"Such

'spread' in stock prices,
as it does the modern

a

reflecting
day

'breaking

up'

of

the

old-

in man's history.
These predictions

in

economy

composite

for

Frank

Radio

ey," said Mr. Schreder, illustrating
this theme with current examples

M.

representing 16 indus¬
tries. "The divergent and rotating
position cf stocks in this market
has been terrific; only one stock
in the Dow Jones Industrial Aver¬

M.

President

Folsom,
Corporation

J.

of

Rathbone,

sey);

and

President

F.
of

President

N.

Belgrano,

Since

1949."

forecasts

of

the

character of America

tive

Expanding on this analysis of
investors' rotating preferences for
individual
stocks

stocks

and

groups

of

opposed to "former mass
-swings," he pointed out that the
popularity of cyclical-type stocks
that has persisted for the past two
years is beginning to diminish as
as

return

is

longer

no

be

of

attraction

of

the

broader

a

representa-

a

of

many
ers,

into

for

20

of

the

under

in

years

the

office

new

construction

here

to

in

fairly

was

this

as

real

man

being patient in
for

ac¬

and

papers

make

high

service

creative

work

lieve

the

in

106

the

The
cided

large corporations,
corporate shareholdwomen
in
industry,

more

workers

over

65,

longer schooling
people age 15 to 24.

for

and

more

young

FINANCIAL

JOHN

two basic benefits
—income
He

and

from investing

price appreciation.

said that "while there is

no

for long-term investors to
disturbed, after such a sharp

reason

be

and substantial rise in stock
as

has occurred

is only good common
to begin to place more em¬
it

years,
sense

phasis
ment
than

prices

the past two

over

on

the

benefit

avallable

fifth edition,

m

GENERAL REALTY & UTILITIES

Selling Wellington

Fund,"

23-

a

circles as a basic tool of mutual
fund selling,
of

Notice

An indication of the popularity
the book can be gauged from

the

Payment

of

"After

working

Possibly

you

idea

that

some

has

used

good.
caused

recent years
little in prep¬

a

both income and

appreciation

Registrar

indi¬

decade."

next

Trust

for

It is

a

then

are

com¬

people

many

We

ress.

moving
than

has

Company,
been

The

New

appointed

Trinity

Place

give

a

a

is

slow

prog¬

imagine that others

forward

with

less

are

effort

our
lot; we want results
they don't show up right

if

often

we

plan

and
we

give

up

good

a

to something else.
jump around from one
go

thing to another, and many times
we
may
have been just at the
point cf beginning to see results
when

discontinue

we

plan that
worthwhile
had only stuck to it for a

might have been
if

we

few more weeks

Fund, Inc. common stock.

a

very

months.

or

Corporation

WANTED

through

carry

much of

ing that

the

with

connected

investment advertis¬

many

firms direct toward

the investor at his level. One week
it

is

idea

an
a

someone

connection

trading over-the-counter

and

Bex V 98, Commercial &

Financial

Chronicle,

25

Park

use




buying

will

again

a

new

approach

an

absence

through on the institu¬
that many firms

approach

intermittently in their adver¬

tising.
As

Place, New York 7, N. Y.

think

There is also

follow

secu¬

tional

rities.

they

is made.
of

the

in

develop
few qualified leads for the sales

force

seeks

else

sales department comes up with

or

Experienced,

and

of

12,

New

cents

day

York

(10c)
the

on

record

30,

at

the

share

per

has

capital stock

October

15,

close

of

1955

of

to

business

1955.
JOSEPH S.

New

STOUT, Secretary.

1955.

York

Debentures of

&

Honduras

Mining

Realty & Utilities Corporation, will

120

be paid on September 30, 1955, at Bankers
Trust Company, Successor Trustee, 46 Wall

Broadway,

New

DIVIDEND

GENERAL REALTY & UTILITIES
CORPORATION

By: SAMUEL M. FOX, Treasurer.
September 15, 1955.

Rosario

Company
York

5,

The
a

Board

Meeting

of

NO.

Directors

held

of

Y.

N.

September

Street, }sew York 15, N. Y.

14,

1955.

412

this

Company,

at

this

day,
declared an Interim
third. ouarter of 1955, of One
Dollar Fifty Cents ($1.50) a share on the out¬
standing capital stock of this Company, payable
on September 30.
1955, to stockhold°rs of record
at the close of business on September 23, 1955.
-UvMsnri

for

G.

E.

the

McDANIEL, Secretary-Treasurer.

DIVIDEND NOTICES

New England Gas
The AR0 EQUIPMENT CORP.

and Electric Association
The

Dividend Notice
an

The Board of Directors has de¬

bond

of

a

I

tells

city

where

his

much

CONTINUITY

is

of

the

lost

value
in

the

advertising message that is at¬
tempted. As an example of what
continuous
advertising
can
do,

one
mu¬

about

that

works

miles
father

al¬
in

a

removed

lives, ancf

is also in the general invest¬

ment

securities

business,

almost
him and

stops

someone

"Aren't

related to

you

,

who

is also in the securities busi¬

ness

in

this

?"

man's

For

father

has

placed

a

small advertisement three times
week in the paper in his

the
his

advertisement

bonds,

telephone
But

without

People all
several

the

little

year

Don't

State

and

section

of

has

man

name

take

has

before

Give

up

lived
with

a

veloped

of

time

your

expensive to operate,
fair trial. I have otten
good

many

reading their local
have told

clients

Others

paper.

it didn't work. From

me

by uncovering
paper that for one

another have

ing.
for

But

been

you

have

let the law
you.

In

if

have been notified of the pro¬

cedure

by letter.

Ey

h
L. L. HAWK

3

Sec.-Treas.

i

August 30, 1933

GENERAL

TIME

Dividends
The Board of Directors has de¬

clared the following
PREFERRED

& CHEMICAL CORPORATION

to

Chicago 6

case,

able

(Si.00)

per

Share

October

1, 1955 to share¬

dividend

share
to

$5.00 Par Value Common Stock

September 19,

STOCK

of

50

shareholders

of record

tember 19, 1955.

20, 1955

30,

Payment Date—Sept.

1955

Potash

•

Chemicals

•

•

Plant Foods

Industrial Minerals

Amino Products

^

Secretary
September 7, 1955.
WESTCL0X

•

BIG BEN

SETH THOMAS

STR0MBERG
HAYD0N

Phosphate

per

Sep¬

John H. Schmidt

Declared—Sept. 8, 1955
Record Date-Sept.

cents

payable October 1, 1955

Forty Cents (40<0 per Share

follow¬

years

cent
pay¬

COMMON

Quarterly Dividend of
One Dollar

Vice President and Treasurer

it

per

1955.

A

or

at

the A\i

preferred stock,

on

54th Consecutive Regular

reason

two

$1.06^4

holders of record

QUARTERLY DIVIDENDS

A. R. Cahill

keep

The regular quarterly dividend
of

cumulative

General Offices:
20 North Wacker Drive,

in

worth

dividends:

STOCK

INTERNATIONAL MINERALS

names

of averages work

one

Moore, Jr., Treasurtr

cash is desired. Shareholders

by

time to time I have obtained good

and

H. C.

4% Cumulative Preferred Stock

Soon

if it doesn't

heard salesmen say they have de¬

the

cost

in

and isn't too

give it

September

September 8,1955.

the

constantly
them year

Up Too

much

too

the close of business

stock

sell

year.

idea is sound,

an

at

years.

his

after

the

ad¬

25

over

he

name

of

26, 1955.

three

this

because

kept his

If

to

minimum

at

shares

and

stability and conservative invest¬

after

shareholders

and

name

this

his

over

associated

ments

for

dividends

common

Association, payable October 15,
1955 to shareholders of record

was

stocks

developed his retail clientele,

have

Arrangements have been made

a

All

appeared

for

financial

where

paper

to

adjoining States who have

the

read

15, 1955

*4

NO.

declared

have

CORPORATION

fail

has

week

a

a

com¬

DIVIDEND

Trustees

regular quarterly dividend of
twenty-five cents (25c) per share

number.

vertisement
times

city.

contained

investment
and his firm

name,

dividend of 3% in

stock

payable on October
holders of record on
September 10, 1955.
mon

25 years

over

accounts

result

for

me

and

1,000

some

who

of

the

business

though he lives
from

in

a

sound

know

been

He

years.

is

message

has

who

nicipal
17

clared

the

convincing,

man

special situation, the next

a

week

Senior Trader

Street,

payable

COMMON

providing

and

This is very obvious in the lack
of

SITUATION

not

do

irritable with

Thus

strongly

Bankers Trust Named

N. Y.,

salesman

and

sufficiently complete
period. We are prone to

testing

away

York,

that

oftentimes

ment benefits of

Bankers

about

difficulties

our

by impatience.

mistake

and

.

another

successfully

Many of

mon

aration for the substantial invest¬

cated for the

read

have given it a trial, only to find
out after a SHORT PERIOD OF
TIME that results were not too

become

all," he observed, "hard¬

is entitled to 'rest'

price

have

good idea

money over

Treasurer.

Coupon No. 22

of

the above-mentioned

on

General

approximately
10,000
securities
throughout the country
have requested this guide.

of

of

this

par value

1955.

ten

this

September

Payment of the amount called for by
Coupon No. 22 representing interest for tlie
months period ending September 30,

salesmen

weekly

benefit

of

declared

September

the fact that during the past year

says,

irregular
price appreciation."

dividend

any

GONZALEZ,

12,

Wall

dividend

been

stockholders

six

1955

page book described in investment

They

the

on

pay

Company's $1

M.

14

Due September 110, IJKMI

sales. ^ developed for investmer?,t secuntjes salesmen is now

continuous invest¬

rather

to

4% Cumulative Income Debentures

One of the effective mutual fund

make, not only in sales work but
in many other serious endeavors.

income,

5

Sugar

NATIONAL SHARES CORPORATION
A

CORPORATION

Wellington Booklet

There Are Many Good Ways to Build
Investment Clientele

re¬
are

Manati

Bryan, Ohio

more

Schreder

the

Stock.

September

on

Mr.

of

NOTICE

By JOHN DUTTON

offering cur¬
rent return that is not only higher
but better protected.

closing,

Street, New York

the

Common

do today is the result of

and

age

Securities Salesman's Corner

stable types of stock

In

you

tm

at¬

minded his audience that there

send

September 12, 1955, de¬

on

not

year on

cumulative in effect. The busi¬
you

Wall

Directors

Company

building
among
friends
associates; all these things

ness

will

DIVIDEND

stantly
are

and

you

MANATI SUGAR COMPANY

good public relations you are con¬
and

a

DIVIDEND NOTICES

prospec¬

advertising,

is

business.

day, the reading, the tele¬
phoning, the sound planning, the

clients,

clients

your

a

and

advice

do

you

talking with clients and

investment
to

each

tive

construct

day-in and day-out job. Keep at
it—enjoy it—and others will be¬

list.

the

to

conservative

quality

and

steady and

your

efforts

reputation

the

planning

working. Keeping on the job,
building goodwill, seeing more
people who can use your services,

continuing

notes of possible
prospective
clients; then I write them a letter
and telephone them a few
times,
or
keep them also on a mailing

All

purposeful

and

and

estate

securities,

yesterday's

dis¬

count more than
repaid me for the
modest amount of time that I take
each year to read the

more

more

more

prominent

leaders, whose
prophecy are soon

sealed

building

essential

two decades

contrast, there is evidence of

increased

Cor-

business

cornerstone

tractive.
In

part

cross-section

ventures

their prices reach such levels that
income

but

are

American
to

predic-

The publication is "A Guide for

picture sketched by

market

of

Jr.,

Transamerica

hence

bull

will have

poration.
Their

included

America, at the three-

order
on

certain

reinvested

in

come

investing in securi¬

large and later
of

to

on

and told

quarter point of the 20th century,

of

America;

Standard Oil Company (New Jer-

throughout this

age

S.

forecasts

tions that

like

first

Corporation;

has acted just like the Aver¬

age

leading
John

as

Financial

the professional manager of mon¬

stocks

S.

the

Corporation; L. L. Colbert, President
of
Chrysler
Corporation;
Arthur
O.
President
of
Dietz,

presents

of

such

of

spokesmen

C.I.T.

opportunities

U.

represent

Coleman, President of Burroughs

fashined business cycle, of course,

great

views

business

The

the

of

1975

The

Vol-, posed

were

among

of

prospect I had

a

mailing list telephoned

sponsored nationally by Hugh W.

OH

Next Decade
,

passed before
a

43

RECORDERS
MOTORS

§

The Commercial and Financial Chronicle
44

Thursday, September 15,1955

...

(1108)

119955236

Washington... yi
Nation'* Capital,

from the

disappointed over the
of Congress this year to

keenly
jailure
pass
the

financing local school construc¬
tion. Nevertheless, figures ob¬
tained
here
reveal,
Congress

in giving
local edu¬

to

support

This responsibility for assum¬

caused

Government

factories

rew

built,

be

to

be set
all this supposedly to
local communities with '

military installations to

and

np,

fcwamp

.

teach,

children to

new

which

cial burden

rendered strictly on
«

governmental institu¬
undertook to teach the big !
children

of

without

tax j

to
help,
many
had i
sympathy for the project. |
However, others would wonder
in such limited cases why the .

I

and
then
they would
districts for
sums equivalent to debt service
on
the bonds sold. He antici¬
themselves

assistance

tional

impacted"

educa¬

is

It

of two

and

year

current educational costs.
From
fiscal
1951
through
fiscal 1956, the current year, the
amount

which

(with

a

Congress

school construction
"impacted areas"
deficiency anticipated
session) will aggregate

favorably.

Fed¬

the

which

local
could

traction

th0

are

rather

million

$200

for

three

under the "impacted
for
financing
local school construction.
area"

program

the President pro¬
three-year program of
$20 million to defray adminisFinally,

expansion

program.

the year-by-year

debt

school-

currently

of the Korean
than

state

the

would thus amount to less
The
annual
rate
the Federal
Government already is spending

tendency
them
to
rise,

defense

a

posed

Here

appropria¬

ing

"impacted area" pro¬

Whether

not

or

Presi¬
aid

the

a

area"
to

years

some

so

ernment

as

program for
There is

come.

permanent in gov¬
a "temporary" sub¬

outside

life

expec¬

lengthened the
permissible terms of
loans to 50 years from 40

and in the quaint way of
government, made it cheaper to
borrow for 50 years than it had
been for 40 years. The rate to
years,

reduced

to

2%%

from 3V4%.

rate,
a

incidentally,

cocked hat

one

of

comparatively few if minor
which actually moved in
of "lessening the

grams

the

dustry
Cole

Anheuser Busch

dormitories,

"primary emphasis,"

will

be

still

try.

Jamieson Adds

students.

Congress initially authorized
$300 million for this, of which
loans for $135 million have been
approved, and another $34 mil¬
lion has been given preliminary
approval. And Congress boosted
the total $200 million to $500
million. However, says 'HHFA,
the Budget Bureau has released
only $65 million for loans this

enrollments in
colleges
and universities last
fall were the highest in history,
exceeding even the volume at
the time free college was pro¬
vided

says

for

SAN DIEGO,

has

Wilbur

veterans

at

a

El

With Gen., American Sees
(Special to The F*tancial Chronicle)

Aaron

FRANCISCO,
Calif.
has joined th

staff

Senderman

General

of

peak

level in 1949. They are expected
to be

even

higher this fall.

government." Mr.
previously provided

upon

had

Why Needed
HHFA

least

one

has

explained

in

at

instance the necessity

New Views

CALIFORNIA

Sulphur

B

(Common) STOCK

Stock Exchange

320 N. 4th St.

St. Louis 2, Mo.

LERNER & CO.

lo&e*
FOREIGN

SECURITIES

50 BROAD STREET

TEL:

GArfield 1-0225

Investment

10

Carl Marks

SCHERCK, IHCHTER COMPANY




on

Co put <?•? rc^tmt

Bought—Sold—Quoted

|

Inc.,

Securities,
Montgomery Street.

RIVERSIDE CEMENT CO.

Wagner Electric

SL 456

American

Canadian

Pipeline Common

Pan American

Teletype

connecte

Co., Inc., 214

Cajon Boulevard.

Mallinckrodt Chemical

Bell

Calif.—Charles C

become

with H. L. Jamieson

SAN

fiscal year.
HHFA

(Special to The Financial Chronicle)

CLASS

Midwest

Tele

Corp.

will discuss the electronics indus

Texas Eastern Transmission

Member

of

upon

Delhi-Taylor

Pacific Northwest

Paul Just, Ex

Management

Vice-President

ecutive

direction

dependence of the Housing in¬

Olin Oil & Gas

for

as

union

Sept. 28, at th
Club, Rowes Wharf

The guest speaker,

loans made to finance residence

Eisenhower Administration pro¬

Eagle Oil

well

as

HHFA says

Congress

new

Club will be held at 5 p.m.

halls,

student

and

Meetinj

Wednesday,

on

vision-Shares

ities,

maximum

This

To Hold

BOSTON, Mass.—The Septem
ber meeting of the Boston Invest

Boston Yacht

halls for

was

Boston Investment Club

provided that "col¬
lege housing" loans could be
made for cafeterias, health facil¬

lege
housing
loan
program
passed by the Congress, another
initially "temporary" program
continuously extended, and also

colleges

the "Chronicle's own views.)

ment

tion wanted,

however,

such

precludes

Treasury.

the

ready to do business
under the more liberalized col¬

permenent

50-

Congress, as the Administra¬

is open and

a

a

the
marketing of much of this debt

Housing and Home Finance
Administrator, Albert M. Cole
has announced that his agency

with

permits

virtually

return

College Loans

Ease

law

the

fleet the "behind the scene" inter¬
pretation from the nation's Capital
and may or may not coincide with

loan, HHFA will "encour¬
age" the 40-year rate, if pos¬
sible. However, the smaller

sidy once provided.

the

Colorado Oil & Gas

.

(This column is intended to re

year

or a

"impacted

Cole said, however, that
if

even

substitute scheme
is passed, it is a pretty good bet
that Congress will continue the

program

official

the

but
try to

rate,

Mr.

,,

construction

school

dent's

guar¬

the college
must
first
get private
borrowing at that rate, before
drawing on the U. S. Treasury.

HHFA

operating cost

educational

at

lend

to

antee

currently paying out in defray¬

knocks into

White

state programs,

one-fourth of what it is

sum

tancy.

This

War and the trend toward con¬

of

of

years

gratuities to pay
operating costs of local
for

evasion

construct

houses.

With Federal

been

to

limits,

education systems, the

despite the end

$200 million of
directly to assist
school
districts
which
not by themselves, or by

resort

through the six fiscal

Operating Expenses Rise

has

the

grants-in-aid

of the program.

actual

have

President
Federal Gov¬

the

ernment provide

spend this year for school con¬
struction, $94 million, is not far
below the average of $101 mil¬
years

addition

would

eral Government is expected to

lion spent

would

In

amount

costs of

trative

nothing

probably develop
that many
more
hundreds of
millions of these bonds would
have to be purchased if states
were
unable to market them

$609 million.
The

three-

a

period purchase up to $750

It

Federally

for next

over

million of these bonds.

will pzy for
in

this

build
Federal Gov¬

the

could

ernment

pay

total

and

schools,

school construc¬
actual subventions to

in

billion

would be raised to

manner

for

$6

the accumulation of
grows," Mr. Butz

inventories "
said.

only

would

HHFA

that

gram.

that

"still

use,

"

under the

pated

"Federally

to

areas.

aid

kinds:
tion

so-called

borrow

$1.1 billion for foreign

and

use

demonstration is quite a joke
looks like I'm all out of

spot remover!"

our

rent to local school

minably.

MacWeasel

Mr.

me,

build schools which

it is wondered why this
burden
must keep up inter¬
the

"Well, guess this little
on

limits," the

state agencies the
would
encourage,

President
:

Although CCC, during the last
year,
disposed of $600

fiscal

million of its stocks for domestic

proposing the

local debt limit eva¬

of

grains.

districts cannot

These

Butz, Assistant Secretary
Agriculture, has given some

figures on Commodity Credit
Corp. involvement in price sup¬
port operations. At present, in¬
vestment in commodity stocks
and loans is about $8.5 billion,
and will rise to $11 billion by

school bor¬

build schools because

scheme for
sion.

set up,

is

subsidy and a

debt

Figures Given

CCC owns 922 million,
wheat; 563 million
bushels
of
corn;
161 million
pounds of butter; 6.3 million
bales
of
cotton;
278
million
pounds of cheese, and will this
year
probably
hold
threefourths of the carryover of feed

-

restrictive

of

good-

the

—

Spring.

million annually

.President said in

will

Sammy

306

chap.

bushels

would

set up to
constitutional debt

state

borrow to

And where a new factory was

This

$982,-

to

Congress

in

"Many school

required

to do.

comes

limits.

parents could not in some way
be induced to provide money for |
the
school
districts the same
all other parents are

-

both con¬

grants

evade

some

as

$1 Billion

thus

And

for 100

Earl

of

by extra-legal state
rowing authorities

receipts

'

CCC

cost of

of

care

natured

sub¬

money.

Uncle

students,
take

a

learning

long-term,

for

needs facilities

it

since

has

the campus,

on

higher

Federal

sidized

huge indirect subsidy through
offering to take up bonds issued

and local
tions

$28,700,000
51,570,000
60,500,000
72,350,000
75,000,000
85,000,000

$373,120,000

smaller admitted

was

government

reservations with tax free land,

influx

qualifies

to states for school
construction, in lieu of the
President's
proposal
for. a

for

Federal. ?

assistance

the

Where

—

settle for $500

finan¬
held by

was

Congress to be morally

-

"liberals"

a

freshman

college

a

of

center

the

120,000 through this fiscal year,
or
just
short
of $1
billion.
Many of the more hard-headed

new

"all

students not living at

must live

home

AmouigJ^,

/

subsidies

many

because
that

rule

struction and operating expense

With the Korean war,"

1951.

stated,

HHFA

that

rule

a

living at home are required
to
live on campus, and more
than 100 students are now in¬

So

Aggregate

*

in

"

defray local operating

to

Costs Nearly

ing local educational costs was
first undertaken by legislation
the

y /\|i

Total

cation.
i

has
not

A. " Cv

1954_____

has not been negligent

institution,

ular

adequately housed."

Fiscal

the latter's proposal to put
Federal Treasury to work

financial

M.T. Mac WEASEL

expenses:

the White House are

cators and

gJ

JTjL I 1/tA/

tions

D. C.—Edu¬

WASHINGTON,

private institution was given
the approval of a loan of $825,000 to provide dormitories for
306 men students. This partic¬

STOCKS AND BONDS

A

Beliind-the-Scene Interpretation*

A particular

this financing.

for

BUSINESS BUZZ

HANOVER 2-0050

•

&

Co. Inc.

SPECIALISTS

NEW YORK 4, N. Y.

TELETYPE NY 1-971

Securj/L',

Post Office Sqaz»<»
Boston, Mass.

Phone HUi'bard 2-1

Teletype

an

15